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MINUTES OF THE

HOUSE REVENUE AND TAXATION

STANDING COMMITTEE

Room 445 - State Capitol, State Capitol Complex


                     February 17, 2009

MEMBERS PRESENT:     Rep. Todd Kiser, Chair
                Rep. Gage Froerer, Vice Chair
                Rep. Sheryl Allen                
                Rep. Tim M. Cosgrove
                 Rep. John Dougall                      
                 Rep. Susan Duckworth
                Rep. Julie Fisher
                Rep. Wayne Harper                 
                Rep. Greg Hughes
                 Rep. Eric Hutchings
                Rep. Christine Johnson
                Rep. Carol Spackman Moss                          
                 Rep. Merlynn T. Newbold                         
                Rep. Stephen Sandstrom                 
                Rep. Evan Vickers
                                 
MEMBERS ABSENT:      Rep. Jennifer Seelig             

STAFF PRESENT:        Bryant Howe, Assistant Director
                Rosemary Young, Secretary
                    
Note:    A list of visitors and a copy of handouts are filed with the committee minutes.

Rep. Kiser called the meeting to order at 8:15 a.m.

MOTION:    Rep. Fisher moved to approve the minutes of the February 12, 2009 meeting. The motion passed unanimously with Rep. Allen, Rep. Hughes, Rep. Hutchings, Rep. Johnson, Rep. Moss, Rep. Sandstrom, and Rep. Froerer absent for the vote.

S.B. 35    Sales and Use Tax Definitions Relating to Property (Sen. W. Niederhauser) (Rep. J. Dougall)

MOTION:    Rep. Dougall moved to amend the bill as follows:

1.    Page 22, Lines 663 through 664 :    

             663          (iii) property attached to oil, gas, or water pipelines, [other than] except for the
             664      property listed in
{   [   } Subsection      {   ]   }      {   Subsections   } (68)(c)(iii)      {   through (v)   }        or (iv)       .



2.    Page 23, Lines 685 through 695 :    

             685          [(H)] (D) tangible personal property similar to Subsections (68)(c)(iii)(A) through
             686      [(G)] (C) as determined by the commission by rule made in accordance with Title 63G, Chapter
             687      3, Utah Administrative Rulemaking Act;
{   [   } or      {   ]   }

             688          
{   (iv) the following if attached to real property, regardless of whether the attachment to

             689      real property is only through a line that supplies water, electricity, gas, telephone, cable, or
             690      supplies a similar item as determined by the commission by rule made in accordance with Title
             691      63G, Chapter 3, Utah Administrative Rulemaking Act:
             692          (A) a hot water heater;
             693          (B) a water [softener] filtration system; or
             694          (C) a water [filtration] softener system; or  
}

             695          
{   (v)   }        (iv)       an item listed in Subsection (108)(c).


The motion passed unanimously with Rep. Allen, Rep. Hughes, Rep. Hutchings, Rep. Johnson, Rep. Moss, and Rep. Froerer absent for the vote.

Sen. Niederhauser introduced the amended bill and explained it to the committee.

MOTION:    Rep. Cosgrove moved to transmit S.B. 35 as amended with a favorable recommendation. The motion passed unanimously with Rep. Hughes, Rep. Hutchings, Rep. Johnson, and Rep. Moss absent for the vote.

MOTION:    Rep. Dougall moved that S.B. 35 be placed on the Consent Calendar. The motion passed unanimously with Rep. Hughes, Rep. Hutchings, Rep. Johnson, and Rep. Moss absent for the vote.

1st Sub. S.B. 36    Sales and Use Tax Amendments (Sen. C. Bramble) (Rep. W. Harper)

Rep. Harper introduced the bill and explained it to the committee.

MOTION:    Rep. Dougall moved to transmit 1st Sub. S.B. 36 with a favorable recommendation. The motion passed unanimously with Rep. Hutchings, Rep. Johnson, and Rep. Moss absent for the vote.


H.B. 157    Property Tax Assessment Amendments (Rep. W. Harper)

MOTION:    Rep. Harper moved to amend the bill as follows:

1.    Page 1, Lines 16 through 17 :    

             16          .    requires second through sixth class counties to levy an additional .000010 per dollar
             17      of taxable value for its
{   Muliticounty   }        Multicounty       Assessing and Collection Levy;


2.    Page 9, Line 250 through Page 9, Line 271 :    

             250      the following calendar year.
             251          Section 4. Section 59-2-1606 is enacted to read:
             252          59-2-1606. Multicounty Appraisal Trust Account --
{   Additional .000010

             253      multicounty assessing and collecting levy  
}
  Deposits into the Multicounty Appraisal Trust Account       -- Distribution and use of funds.

             254          (1) As used in this section:
             255          (a) "CAMA" means
  computer assisted       mass appraisal      {   system   } .

             256          (b) "CAMA fee rate" means:
             257          (i) $1.50 for the calendar year that begins on January 1, 2009; and
             258          (ii) for a calendar year beginning on or after January 1, 2010, the $1.50 shall be
             259      increased each year by 2%.
             260          (c) "Factored parcel count" means the product of:
             261          (i) a county's parcel count described in Subsection 59-2-1603 (3)(f); and
             262          (ii) the county's
{   class   }        parcel       factor described in Subsection 59-2-1603 (3)(e).

             263          (d) "Multicounty Appraisal Trust" means the Multicounty Appraisal Trust created by
             264      interlocal agreement by all 29 counties in the state.
             265          (e) "Multicounty Appraisal Trust Account" means the Multicounty Appraisal Trust
             266      Account created in this section.
             267          (2) (a) There is created a restricted account within the Property Tax Valuation Agency
             268      Fund known as the "Multicounty Appraisal Trust Account."
             269          (b) The purpose of the Multicounty Appraisal Trust Account is to provide funding for a
             270      statewide
{   assisted mass appraisal   }        CAMA       system that will promote:


             271
         (i) accurate valuation of property;
                 

3.    Page 10, Lines 290 through 291 :    

             290          (4) The Multicounty Appraisal Trust shall determine which projects should be funded
             291      and oversee the administration of a statewide
{   computer assisted mass appraisal   }        CAMA       system.


The motion passed unanimously with Rep. Johnson and Rep. Moss absent for the vote.

Rep. Harper, assisted by Kris Poulson, Utah County Assessor, introduced the bill and explained it to the committee. Brent Gardner, Utah Association of Counties, spoke in favor of the bill.

MOTION:    Rep. Cosgrove moved to transmit H.B. 157 as amended with a favorable recommendation. The motion passed unanimously with Rep. Johnson and Rep. Moss absent for the vote.

H.B. 199    Statewide Equalization of School Funding (Rep. W. Harper)

Rep. Harper moved to amend H.B. 199 as follows:

1.    Page 4, Lines 103 through 104 :    

             103     
Part 6.
{   Capitol   }        Capital       Outlay Equalization Program

             104          53A-21-601. Capital Outlay Equalization Program -- Definitions.


2.    Page 5, Lines 126 through 127 :    

             126          (e) "Contributing district" or "contributing school district" means a
  participating       school district that

             127      in a fiscal year receives less revenue from the allocations made under Section 53A-21-602 than


3.    Page 5, Line 130 :    

             130          (f) "Neutral school district" means a
  participating       school district that in a fiscal year receives the



4.    Page 5, Lines 133 through 134 :    

             133      53A-21-603 .
             134          (g)
  "Participating school district" or "participating district" means a school district that:

        (i) is located in a county of the first, second, or third class; or
        (ii) is located in a county of the fourth, fifth, or sixth class and notifies the State Board of Education of its intent to participate in the Capital Outlay Equalization Program.
(h)  
"Rate reduction limitation increment" means, for a receiving district whose



5.    Page 5, Line 142 :    

             142          
{   (h)   }        (i)       "Receiving district" or "receiving school district" means a        participating       school district that in a



6.    Page 5, Lines 149 through 151 :    

             149      2010-11, the State Board of Education shall allocate funding from the Capital Outlay
             150      Equalization Fund to a
  participating       school district in an amount equal to the product of:

             151          (i) the adjusted allocation amount per student; and

7.    Page 6, Lines 168 through 169 :    

             168          (2) The State Board of Education shall allocate to a
  participating       school district the greater of an

             169      amount equal to
{   a   }        the participating       school district's allocation pursuant to Subsection (1) or an amount equal to


8.    Page 6, Lines 170 through 177 :    

             170      the revenue generated within the
  participating       school district by the imposition of the basic capital outlay

             171      levy required under Section 53A-21-603 if
{   :

             172          (a) the school district is in a county of the fourth through sixth class; or
             173          (b)  
}
the
  participating       school district:

             174          
{   (i)   }        (a)       has a school district property tax base per enrolled student less

than 70% of the


             175      statewide average property tax base per enrolled student; and
             176          
{   (ii)   }        (b)       a combined capital levy rate greater than 70% of the highest combined capital levy

             177      rate.

9.    Page 6, Line 180 through Page 7, Line 184 :    

             180      shall reduce each district's allocation by an equal percentage.
             181          (4) A
  participating       school district shall remit to the State Board of Education an amount equal to the

             182      revenue generated from the basic capital outlay tax rate imposed under Section 53A-21-603 on
             183      or before the June 30 immediately following the end of the taxable year in which the
  participating1           school

             184      district imposes the basic capital outlay tax rate.

10.    Page 7, Line 199 :    

             199      decrease other allocations that would otherwise be made to a
  participating       school district, if the accounting



11.    Page 7, Lines 205 through 207 :    

             205          For taxable years beginning on or after January 1, 2010, in order to qualify for receipt of
             206      state funds pursuant to Title 53A, Chapter 17a, Minimum School Program Act, a
  participating       school district

             207      shall impose a basic capital outlay tax rate of
{   .000727   }        .000584       per dollar of taxable value.


12.    Page 7, Line 212 through Page 8, Line 215 :    

             212          (b) "Combined capital outlay certified tax rate" means a combined capital levy tax rate
             213      that will provide the same ad valorem property tax revenues for a
  participating       school district as were

             214      budgeted by that
  participating       school district for the prior year for the        participating       school district's combined capital levy


             215
     rate.

13.    Page 8, Lines 219 through 224 :    

             219          (3) The calculation of a
  participating       school district's combined capital outlay certified tax rate shall

             220      be used:
             221          (a) by the State Board of Education to determine the allocation of funds from the
             222      Capital Outlay Equalization Fund in accordance with Section 53A-21-602 ; and
             223          (b) to offset
{   a   }        the participating       school district's aggregate certified tax rate as provided in Section

             224      59-2-924.5 .

The motion passed unanimously.

Rep. Harper, assisted by Angela Oakes, Associate General Counsel, Office of Legislative Research and General Counsel, introduced the bill and explained it to the committee with the use of a handout. Janet Roberts, Utah School Boards Association, and Brian Allen, Cottonwood Heights City, spoke against the bill. Kathie Johnson, South Jordan City Council, and Royce Van Tassell, Utah Taxpayers Association, spoke in favor of the bill.

MOTION:    Rep. Allen moved to transmit H.B. 199 with a favorable recommendation.

SUBSTITUTE MOTION:    Rep. Hutchings moved to adjourn. The motion passed with Rep. Allen, Rep. Dougall, Rep. Harper, Rep. Newbold, and Rep. Kiser voting in opposition and Rep. Moss and Rep. Sandstrom absent for the vote.

Rep. Kiser adjourned the meeting at 9:54 a.m.







                            __________________________
                            Rep. Todd E. Kiser, Chair