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H.B. 59






Chief Sponsor: Jim Bird

Senate Sponsor: ____________

             8      LONG TITLE
             9      General Description:
             10          This bill modifies the Alcoholic Beverage Control Act to allocate certain gross
             11      revenues from the sale of liquor to support public education.
             12      Highlighted Provisions:
             13          This bill:
             14          .    defines terms;
             15          .    directs the deposit of a portion of liquor revenues to the Education Fund;
             16          .    provides for the distribution to local educational agencies;
             17          .    establishes that the money may be used for operations, capital facilities, or debt
             18      service; and
             19          .    addresses money deposited into the Education Fund.
             20      Money Appropriated in this Bill:
             21          This bill appropriates:
             22          .    to the State Board of Education, as an ongoing appropriation:
             23              .    from the Education Fund, $31,580,833 subject to intent language that states that
             24      the appropriation is to be distributed as provided in statute.
             25      Other Special Clauses:
             26          None
             27      Utah Code Sections Affected:

             28      AMENDS:
             29          51-5-4, as last amended by Laws of Utah 2010, Chapter 278
             30      ENACTS:
             31          32B-2-306, Utah Code Annotated 1953
             33      Be it enacted by the Legislature of the state of Utah:
             34          Section 1. Section 32B-2-306 is enacted to read:
             35          32B-2-306. Public education deposit of certain liquor profits.
             36          (1) As used in this section, "local education agency" means a public authority legally
             37      constituted by the state as an administrative agency to provide control of and direction for
             38      kindergarten through grade 12 public educational institutions.
             39          (2) The department shall deposit 10% of the total gross revenue from sales of liquor
             40      with the state treasurer to be credited to the Education Fund to be distributed to local education
             41      agencies as provided in Subsection (3).
             42          (3) For a fiscal year beginning on or after July 1, 2012, the State Board of Education
             43      shall annually allocate the total gross revenue described in Subsection (2) on or after October 1
             44      of the fiscal year as follows:
             45          (a) local education agencies combined shall receive 10% of the money on an equal
             46      basis; and
             47          (b) the remaining 90% of the money shall be distributed on a per student basis, with
             48      each local education agency receiving its allocation on the basis of the number of students
             49      enrolled in the local education agency on the previous October 1 as compared to the state total.
             50          (4) The money distributed under Subsection (3) may be used by a local education
             51      agency for operations, capital facilities, or debt service.
             52          Section 2. Section 51-5-4 is amended to read:
             53           51-5-4. Funds established -- Titles of funds -- Fund functions.
             54          (1) (a) (i) The funds enumerated in this section are established as major fund types.
             55          (ii) All resources and financial transactions of Utah state government shall be
             56      accounted for within one of these major fund types.
             57          (b) (i) All funds or subfunds shall be consolidated into one of the state's major fund
             58      types.

             59          (ii) Where a specific statute requires that a restricted fund or account be established,
             60      that fund or account shall be accounted for as an individual fund, subfund, or account within
             61      the major fund type to meet generally accepted accounting principles.
             62          (iii) Existing and new activities of state government authorized by the Legislature shall
             63      be accounted for within the framework of the major fund types established in this section.
             64          (c) The Division of Finance shall determine the accounting classification that complies
             65      with generally accepted accounting principles for all funds, subfunds, or accounts created by
             66      the Legislature.
             67          (d) (i) Major fund types shall be added by amending this chapter.
             68          (ii) Whenever a new act creates or establishes a fund, subfund, or account without
             69      amending this chapter, the reference to a fund, subfund, or account in the new act shall be
             70      classified within one of the major fund types established by this section.
             71          (2) Major Fund Type Titles:
             72          (a) General Fund;
             73          (b) Special Revenue Funds;
             74          (c) Capital Projects Funds;
             75          (d) Debt Service Funds;
             76          (e) Permanent Funds;
             77          (f) Enterprise Funds;
             78          (g) Internal Service Funds;
             79          (h) Trust and Agency Funds; and
             80          (i) Discrete Component Unit Funds.
             81          (3) The General Fund shall receive all revenues and account for all expenditures not
             82      otherwise provided for by law in any other fund.
             83          (4) Special Revenue Funds account for proceeds of specific revenue sources, other than
             84      permanent funds, trust and agency funds, or major capital projects, that are legally restricted to
             85      expenditures for a specific purpose.
             86          (a) The Education Fund is a Special Revenue Fund that:
             87          (i) receives all revenues from taxes on intangible property [or], from a tax on income,
             88      or money transferred to the fund under Section 32B-2-306 ; and
             89          (ii) is designated for public and higher education.

             90          (b) The Transportation Investment Fund of 2005 is a Special Revenue Fund that
             91      accounts for revenues that are required by law to be expended for the maintenance,
             92      construction, reconstruction, or renovation of certain state and federal highways.
             93          (c) The Transportation Fund is a Special Revenue Fund that accounts for all revenues
             94      that are required by law to be expended for highway purposes.
             95          (d) (i) A Restricted Special Revenue Fund is a Special Revenue Fund created by
             96      legislation or contractual relationship with parties external to the state that:
             97          (A) identifies specific revenues collected from fees, taxes, dedicated credits, donations,
             98      federal funds, or other sources;
             99          (B) defines the use of the money in the fund for a specific function of government or
             100      program within an agency; and
             101          (C) delegates spending authority or authorization to use the fund's assets to a governing
             102      board, administrative department, or other officials as defined in the enabling legislation or
             103      contract establishing the fund.
             104          (ii) A Restricted Special Revenue Fund may only be created by contractual relationship
             105      with external parties when the sources of revenue for the fund are donated revenues or federal
             106      revenues.
             107          (iii) Restricted Special Revenue Funds are subject to annual legislative review by the
             108      appropriate legislative appropriations subcommittee.
             109          (5) Capital Projects Funds account for financial resources to be expended for the
             110      acquisition or construction of major capital facilities, except that when financing for the
             111      acquisition or construction of a major capital facility is obtained from a trust fund or a
             112      proprietary type fund within one of the major fund types, the money shall be accounted for in
             113      those accounts.
             114          (6) Debt Service Funds account for the accumulation of resources for, and the payment
             115      of, the principal and interest on general long-term obligations.
             116          (7) Permanent Funds account for assets that are legally restricted to the extent that only
             117      earnings, and not principal, may be used for a specific purpose.
             118          (8) Enterprise Funds are designated to account for the following:
             119          (a) operations, financed and operated in a manner similar to private business
             120      enterprises, where the Legislature intends that the costs of providing goods or services to the

             121      public are financed or recovered primarily through user charges;
             122          (b) operations where the Legislature requires periodic determination of revenues
             123      earned, expenses incurred, and net income;
             124          (c) operations for which a fee is charged to external users for goods or services; or
             125          (d) operations that are financed with debt that is secured solely by a pledge of the net
             126      revenues from fees and charges of the operations.
             127          (9) Internal Service Funds account for the financing of goods or services provided by
             128      one department, division, or agency to other departments, divisions, or agencies of the state, or
             129      to other governmental units, on a cost-reimbursement basis.
             130          (10) (a) Trust and Agency Funds account for assets held by the state as trustee or agent
             131      for individuals, private organizations, or other governmental units.
             132          (b) Pension Trust Funds, Investment Trust Funds, Private-Purpose Trust Funds, and
             133      Agency Funds are Trust and Agency Funds.
             134          (11) Discrete Component Unit Funds account for the financial resources used to
             135      operate the state's colleges and universities and other discrete component units.
             136          Section 3. Appropriation.
             137          Under the terms and conditions of Title 63J, Chapter 1, Budgetary Procedures Act, the
             138      following sums of money are appropriated from resources not otherwise appropriated, or
             139      reduced from amounts previously appropriated, out of the funds or fund accounts indicated for
             140      distribution to local education agencies for the fiscal year beginning July 1, 2012, and ending
             141      June 30, 2013. These appropriations are additions to amounts previously appropriated for
             142      fiscal year 2012-13.
             143          To Related to Basic Programs
             144              From Education Fund

             145              Schedule of Programs:
             146                  Liquor Revenues Allocation            $31,580,833
             147          It is the intent of the Legislature that the State Board of Education shall allocate the
             148      money appropriated under this item in accordance with Section 32B-2-306 .

Legislative Review Note
    as of 1-6-12 1:55 PM

Office of Legislative Research and General Counsel

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