S.B. 175

1

REVENUE PROCEDURES AND CONTROL ACT
2 AMENDMENTS
3 2003 GENERAL SESSION
4 STATE OF UTAH
5 Sponsor: Curtis S. Bramble
6 This act modifies the Utah Code sections governing accounting for revenues. This act
7 authorizes state agencies to collect fees or other revenues via credit cards or other
8 electronic means. This act authorizes state agencies to increase their fees to reimburse
9 the agency for the cost charged by third parties to process those electronic payments and
10 establishes requirements for accounting for those fees. This act requires the Office of the
11 Legislative Fiscal Analyst to study the process established in this act and make
12 recommendations to the Legislature. This act takes effect on July 1, 2003. Section
13 63-38a-105 is repealed July 1, 2007.
14 This act affects sections of Utah Code Annotated 1953 as follows:
15 AMENDS:
16 41-1a-1201, as last amended by Chapter 1, Laws of Utah 2003
17 41-22-19, as last amended by Chapter 73, Laws of Utah 1999
18 63-55b-163, as last amended by Chapter 49, Laws of Utah 2002
19 73-18-22, as last amended by Chapter 205, Laws of Utah 1998
20 ENACTS:
21 41-1a-1221, Utah Code Annotated 1953
22 41-22-36, Utah Code Annotated 1953
23 63-38a-105, Utah Code Annotated 1953
24 73-18-25, Utah Code Annotated 1953
25 Be it enacted by the Legislature of the state of Utah:
26 Section 1. Section 41-1a-1201 is amended to read:
27 41-1a-1201. Disposition of fees.

28 (1) All fees received and collected under this part shall be transmitted daily to the state
29 treasurer.
30 (2) Except as provided in Subsections (3), (4), and (6), and [Section] Sections
31 41-1a-422 , [and in Section] 41-1a-1220 , and 41-1a-1221 , all fees collected under this part shall
32 be deposited in the Transportation Fund.
33 (3) (a) Funds generated under Subsections 41-1a-1211 (1)(a), (6)(a), and (7) and
34 Section 41-1a-1212 may be used by the commission as a dedicated credit to cover the costs
35 incurred in issuing license plates under Part 4, License Plates and Registration Indicia.
36 (b) Fees for statehood centennial license plates shall be collected and deposited in the
37 Transportation Fund, less production and administrative costs incurred by the commission.
38 (4) All funds available to the commission for purchase and distribution of license
39 plates and decals are nonlapsing.
40 (5) Except as provided in Subsection (3) and Section 41-1a-1205 , the expenses of the
41 commission in enforcing and administering this part shall be provided for by legislative
42 appropriation from the revenues of the Transportation Fund.
43 (6) The following portions of the registration fees imposed under Section 41-1a-1206
44 for each vehicle shall be deposited in the Centennial Highway Fund created under Section
45 72-2-118 :
46 (a) $10 of the registration fees imposed under Subsections 41-1a-1206 (1)(a), (1)(b),
47 (2), and (5);
48 (b) $1 of the registration fees imposed under Subsections 41-1a-1206 (1)(c)(i),
49 (1)(c)(ii), and (1)(d)(ii);
50 (c) $2 of the registration fee imposed under Subsection 41-1a-1206 (1)(e)(ii);
51 (d) $3 of the registration fee imposed under Subsection 41-1a-1206 (1)(d)(i); and
52 (e) $4.50 of the registration fee imposed under Subsection 41-1a-1206 (1)(e)(i).
53 Section 2. Section 41-1a-1221 is enacted to read:
54 41-1a-1221. Fees to cover the cost of electronic payments.
55 (1) In accordance with Section 63-38a-105 , the Division of Motor Vehicles may collect
56 an electronic payment fee on all registrations and renewals of registration under Subsections
57 41-1a-1206 (1)(a), 41-1a-1206 (1)(b), and 41-1a-1206 (2).
58 (2) The division shall establish the fee according to the procedures and requirements of

59 Section 63-38-3.2 .
60 Section 3. Section 41-22-19 is amended to read:
61 41-22-19. Deposit of fees and related moneys in Off-highway Vehicle Account --
62 Use for facilities, costs and expenses of division, and education -- Request for matching
63 funds.
64 (1) Except as provided under [Section] Sections 41-22-34 and 41-22-36 , all registration
65 fees and related moneys collected by the Motor Vehicle Division or any agencies designated to
66 act for the Motor Vehicle Division under this chapter shall be deposited as restricted revenue in
67 the Off-highway Vehicle Account in the General Fund less the costs of collecting off-highway
68 vehicle registration fees by the Motor Vehicle Division. The balance of the monies may be
69 used by the division as follows:
70 (a) for the construction, improvement, operation, or maintenance of publicly owned or
71 administered off-highway vehicle facilities;
72 (b) as grants or as matching funds with any federal agency, political subdivision of the
73 state, or organized user group for the construction, improvement, operation, acquisition, or
74 maintenance of publicly owned or administered off-highway vehicle facilities including public
75 access facilities;
76 (c) for the administration and enforcement of the provisions of this chapter; and
77 (d) for the education of off-highway vehicle users.
78 (2) All agencies or political subdivisions requesting matching funds shall submit plans
79 for proposed off-highway vehicle facilities to the division for review and approval.
80 Section 4. Section 41-22-36 is enacted to read:
81 41-22-36. Fees to cover the costs of electronic payments.
82 (1) In accordance with Section 63-38a-105 , the Division of Motor Vehicles may collect
83 an electronic payment fee on all registrations and renewals of registration under Section
84 41-22-8 .
85 (2) The division shall establish the fee according to the procedures and requirements of
86 Section 63-38-3.2 .
87 Section 5. Section 63-38a-105 is enacted to read:
88 63-38a-105. Electronic Revenue Collections.
89 (1) As used in this section:

90 (a) "Agency" means any legislative, executive, judicial, or other entity of state
91 government that receives appropriations or charges fees and whose budget is accounted for by
92 the Division of Finance.
93 (b) "Electronic payment" means use of any form of payment processed through
94 electronic means, including credit cards, debit cards, and automatic clearinghouse transactions.
95 (c) "Electronic payment fee" means the fee assessed by an agency under the authority
96 of this section to defray the charge, discount fee, or processing fee charged by credit card
97 companies or processing agents to process an electronic payment.
98 (d) "Processing agent" means a bank, transaction clearing business, or other third-party
99 system provider that charges a fee to process an electronic payment.
100 (2) An agency may accept electronic payments by following the procedures and
101 requirements of this section.
102 (3) (a) If an agency chooses to accept electronic payments for a transaction, the agency
103 may charge an electronic payment fee.
104 (b) Each agency that charges an electronic payment fee shall include in its budget an
105 estimated total amount of revenue expected from electronic payment fees.
106 (c) If an agency chooses to charge an electronic payment fee, for fiscal year 2003-04
107 only, the agency need not comply with the procedures and requirements of Section 63-38-3.2 in
108 setting that fee.
109 (4) (a) Except as provided in Subsection (4)(d), each agency that chooses to charge an
110 electronic payment fee under Subsection (3) shall:
111 (i) determine the amount of the electronic payment fee; and
112 (ii) deposit electronic payment fees collected by it as dedicated credits under a separate
113 identification established for electronic payment fees by the Division of Finance.
114 (b) (i) An agency shall:
115 (A) include the cost of the electronic payment fee as a component of any other fee,
116 regulatory fee, or other charge collected by the agency; and
117 (B) ensure that the fee, regulatory fee, or other charge for a transaction includes the
118 electronic payment fee regardless of the method of payment.
119 (ii) (A) The agency may not separately identify the electronic payment fee from the rest
120 of the fee, regulatory fee, or other charge in the fee schedule provided to the Legislature as

121 required by Section 63-38-3.2 .
122 (B) Notwithstanding the provisions of Subsection (4)(b)(ii)(A), if a fee or charge is set
123 forth in statute, an agency may include a separate electronic payment fee in the fee schedule
124 required by Section 63-38-3.2 .
125 (c) Except as provided in Subsection (8), an agency may not separately identify a
126 charge assessed to cover the cost of an electronic payment as a convenience fee or a surcharge
127 on an electronic payment.
128 (d) The Division of Finance may grant a whole or partial waiver from the requirements
129 of this Subsection (4) to any agency that is currently charging an electronic payment fee if the
130 agency demonstrates that complying with this Subsection (4) would be unduly burdensome or
131 expensive.
132 (5) (a) The amount collected by an agency as dedicated credits from the electronic
133 payment fee portion of a fee, regulatory fee, or charge:
134 (i) may be expended by the agency to cover the cost of electronic payments; and
135 (ii) is not subject to the expenditure limits or lapsing requirements of Subsection
136 63-38a-104 (2).
137 (b) The amount collected for electronic payment fees that exceeds the amount
138 necessary to pay the cost of electronic payments does not lapse to any fund at the end of any
139 fiscal year.
140 (c) An agency may use any nonlapsing balance authorized by this Subsection (5) only
141 to offset any subsequent shortages in electronic payment fee collections.
142 (6) (a) In accounting for electronic payment fees, the Division of Finance shall:
143 (i) establish a separate identification for electronic payment fees;
144 (ii) ensure that the identification is different from the revenue type identification;
145 (iii) treat the cost of electronic payments as an administrative expense of the agency
146 accepting the electronic payment; and
147 (iv) account for electronic payment fees as dedicated credits to be used to pay the cost
148 of electronic payments.
149 (b) In accounting for electronic payment fees, the Division of Finance may not apply to
150 the electronic payment fee the same identification as to revenue type or use restriction as the
151 fee to which it applies.

152 (7) In preparing the annual appropriations act, the Office of the Legislative Fiscal
153 Analyst shall, if directed to do so by the Legislature, fund electronic payment fees as part of the
154 agency's appropriation as:
155 (a) dedicated credits, if the agency has increased fees, regulatory fees, or other charges
156 as authorized by Subsection (4)(b); or
157 (b) an appropriation from free revenues or restricted accounts.
158 (8) (a) If the cost of processing electronic payments as required in Subsections (4)
159 through (7) is excessive for large dollar items such as taxes or other large regulatory fees, an
160 agency may establish an alternate method for recovering those costs, including:
161 (i) imposing an additional convenience fee charged to the payee;
162 (ii) imposing restrictions on the type of electronic payments accepted; or
163 (iii) other variations to recover the cost of processing electronic payments.
164 (b) An agency may not implement an alternative method of cost recovery under this
165 Subsection (8) until it is approved by the director of the Division of Finance and the director of
166 the Governor's Office of Planning and Budget.
167 (c) If an agency is authorized to charge an additional convenience fee or surcharge for
168 processing these large dollar electronic payments, the agency and the Division of Finance shall:
169 (i) account for those fees as dedicated credits; and
170 (ii) comply with the requirements of this section in depositing and accounting for those
171 fees.
172 (d) If an agency is authorized to charge an additional convenience fee or surcharge for
173 processing these large dollar electronic payments, the agency shall determine the amount of the
174 convenience fee or surcharge.
175 (9) (a) Notwithstanding the provisions of Section 63-38-3.2 , an agency may increase
176 the fees identified in the fee schedule passed in the 2003 Annual General Session of the
177 Legislature by the amount of the electronic payment fee authorized by this section.
178 (b) In the 2004 Annual General Session, each agency that is required to submit a fee
179 schedule under Section 63-38-3.2 shall submit a report that identifies:
180 (i) the fee amount that was approved by the Legislature in the 2003 Annual General
181 Session; and
182 (ii) the specific electronic payment fee amount added to that fee by the agency under

183 authority of this section.
184 (c) In submitting the fee schedule required by Section 63-38-3.2 for the 2004 Annual
185 General Session, the agency shall identify the new fee amount, which shall include the
186 electronic payment fee, to be approved by the Legislature in the 2004 Annual General Session.
187 (10) (a) After July 1, 2004, an agency may not charge, assess, or establish any fee,
188 convenience fee, or surcharge to cover the cost of electronic payments except as provided in
189 this section.
190 (b) The fees or charges established in the following sections are subject to this section:
191 (i) Section 41-1a-1221 ;
192 (ii) Section 41-22-36 ; and
193 (iii) Section 73-18-25 .
194 (11) During the 2006 interim, the Office of the Legislative Fiscal Analyst shall:
195 (a) analyze the process established by this section to determine its strengths and
196 weaknesses;
197 (b) specifically evaluate the advantages and disadvantages of shifting funding of
198 electronic processing fees from dedicated credits to each agency's base budget; and
199 (c) by November 1, 2006, make recommendations to the Executive Appropriations
200 Committee about:
201 (i) whether the process established by this section should be reauthorized or sunsetted;
202 (ii) improvements or modifications to the process established by this section; and
203 (iii) whether or not to continue funding electronic payment fees through dedicated
204 credits.
205 Section 6. Section 63-55b-163 is amended to read:
206 63-55b-163. Repeal dates, Title 63.
207 (1) Section 63-38a-105 is repealed July 1, 2007.
208 [(3)] (2) Section 63-56-35.9 is repealed July 1, 2005.
209 [(2)] (3) Sections 63-63b-101 and 63-63b-102 are repealed on July 1, 2007.
210 [(1)] (4) Title 63, Chapter 95, Parts 2 and 3 are repealed July 1, 2004.
211 Section 7. Section 73-18-22 is amended to read:
212 73-18-22. Boating Account created -- Contents -- Use of money.
213 (1) There is created within the General Fund a restricted account known as the Boating

214 Account.
215 (2) Except as provided under [Section] Sections 73-18-24 and 73-18-25 , all registration
216 fees and related moneys collected by the division or any authorized agent, less the costs of
217 collecting motorboat and sailboat registration fees by an authorized agent, shall be deposited
218 into the Boating Account.
219 (3) The amount retained by an authorized agent may not exceed 20% of the fees
220 charged in Section 73-18-7 .
221 (4) Money in the Boating Account may be used for:
222 (a) the construction, improvement, operation, and maintenance of publicly owned
223 boating facilities;
224 (b) boater education; and
225 (c) the payment of the costs and expenses of the division in administering and
226 enforcing this chapter.
227 Section 8. Section 73-18-25 is enacted to read:
228 73-18-25. Fees to cover the costs of electronic payments.
229 (1) In accordance with Section 63-38a-105 , the Division of Motor Vehicles may collect
230 an electronic payment fee on all registrations and renewals of registration under Section
231 73-18-7 .
232 (2) The division shall establish the fee according to the procedures and requirements of
233 Section 63-38-3.2 .
234 Section 9. Effective date.
235 This act takes effect on July 1, 2003.




Legislative Review Note
as of 2-18-03 7:59 AM

A limited legal review of this legislation raises no obvious constitutional or statutory concerns.

Office of Legislative Research and General Counsel