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H.B. 482

             1     

SEVERANCE TAX FUNDING FOR CERTAIN PROGRAMS

             2     
2012 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: Ken Ivory

             5     
Senate Sponsor: Wayne L. Niederhauser

             6     
             7      LONG TITLE
             8      General Description:
             9          This bill provides funding for the Constitutional Defense Restricted Account from
             10      certain oil and gas severance tax revenues.
             11      Highlighted Provisions:
             12          This bill:
             13          .    provides funding for the Constitutional Defense Restricted Account from certain oil
             14      and gas severance tax revenues;
             15          .    provides that the Division of Finance shall make deposits into the Constitutional
             16      Defense Restricted Account after making the deposits required to be made into the
             17      Uintah Basin Revitalization Fund and the Navajo Revitalization Fund;
             18          .    repeals obsolete language; and
             19          .    makes technical and conforming changes.
             20      Money Appropriated in this Bill:
             21          None
             22      Other Special Clauses:
             23          None
             24      Utah Code Sections Affected:
             25      AMENDS:
             26          51-9-305, as last amended by Laws of Utah 2011, Chapter 239
             27          59-5-115, as last amended by Laws of Utah 2008, Chapter 141


             28          59-5-116, as last amended by Laws of Utah 2010, Chapter 28
             29          59-5-119, as last amended by Laws of Utah 2007, Chapter 104
             30          63C-4-103, as last amended by Laws of Utah 2011, Chapters 252 and 303
             31      ENACTS:
             32          59-5-121, Utah Code Annotated 1953
             33     
             34      Be it enacted by the Legislature of the state of Utah:
             35          Section 1. Section 51-9-305 is amended to read:
             36           51-9-305. Crediting of certain severance tax revenues to the permanent state
             37      trust fund -- Disposition of earnings, interest, or dividends on severance tax revenues
             38      deposited into the permanent state trust fund.
             39          (1) (a) After making the distributions of oil and gas severance tax revenues as required
             40      under Sections 59-5-116 [and], 59-5-119 , and 59-5-121 , the Division of Finance shall make the
             41      distributions required under [Subsections (2) through (5)] this section.
             42          (b) For purposes of this section, revenue collected from severance taxes on oil and gas
             43      imposed under Title 59, Chapter 5, Severance Tax on Oil, Gas, and Mining, does not include
             44      revenue that is distributed under Section 59-5-116 [or], 59-5-119 , or 59-5-121 .
             45          [(2) (a) Beginning with fiscal year 2008-09 and ending with fiscal year 2010-11, if
             46      authorized by law, the Division of Finance shall credit to the permanent state trust fund all
             47      revenue collected in a fiscal year from severance taxes on oil and gas imposed under Title 59,
             48      Chapter 5, Severance Tax on Oil, Gas, and Mining, that exceed $71,000,000.]
             49          [(b)] (2) Beginning with fiscal year 2011-12, [if authorized by law,] the Division of
             50      Finance shall credit to the permanent state trust fund all revenue collected in a fiscal year from
             51      severance taxes on oil and gas imposed under Title 59, Chapter 5, Severance Tax on Oil, Gas,
             52      and Mining, that exceed $77,000,000.
             53          (3) Beginning with fiscal year 2008-09, [if authorized by law,] the Division of Finance
             54      shall credit to the permanent state trust fund all revenue collected in a fiscal year from
             55      severance taxes on mining imposed under Title 59, Chapter 5, Severance Tax on Oil, Gas, and
             56      Mining, that exceed $27,600,000.
             57          (4) The state treasurer shall invest and separately account for the earnings on [funds]
             58      revenues collected from a tax imposed under Title 59, Chapter 5, Severance Tax on Oil, Gas,


             59      and Mining, that are deposited into the permanent state trust fund [under this section].
             60          (5) (a) In accordance with Utah Constitution Article XXII, Section 4, the interest and
             61      dividends earned annually on [revenue from severance taxes] revenues collected from a tax
             62      imposed under Title 59, Chapter 5, Severance Tax on Oil, Gas, and Mining, that are deposited
             63      into the permanent state trust fund shall be deposited in the General Fund.
             64          (b) Interest and dividends earned on [revenue from severance taxes] revenues collected
             65      from a tax imposed under Title 59, Chapter 5, Severance Tax on Oil, Gas, and Mining, that are
             66      deposited in the General Fund pursuant to Subsection (5)(a) shall be credited to the
             67      Infrastructure and Economic Diversification Investment Account created in Section 51-9-303 .
             68          Section 2. Section 59-5-115 is amended to read:
             69           59-5-115. Disposition of taxes collected -- Credit to General Fund.
             70          [All taxes] Except as provided in Section 51-9-305 , 59-5-116 , 59-5-119 , or 59-5-121 , a
             71      tax imposed and collected under Section 59-5-102 shall be paid to the commission, promptly
             72      remitted to the state treasurer, and [except those taxes otherwise allocated under Section
             73      51-9-305 , 59-5-116 , or 59-5-119 ,] credited to the General Fund.
             74          Section 3. Section 59-5-116 is amended to read:
             75           59-5-116. Disposition of certain taxes collected on Ute Indian land.
             76          (1) Except as provided in Subsection (2), there shall be deposited into the Uintah Basin
             77      Revitalization Fund established in Section 9-10-102 :
             78          (a) for taxes imposed under this part, 33% of the taxes collected on oil, gas, or other
             79      hydrocarbon substances produced from a well:
             80          (i) for which production began on or before June 30, 1995; and
             81          (ii) attributable to interests:
             82          (A) held in trust by the United States for the Tribe and its members; or
             83          (B) on lands identified in Pub. L. No. 440, 62 Stat. 72 (1948);
             84          (b) for taxes imposed under this part, 80% of taxes collected on oil, gas, or other
             85      hydrocarbon substances produced from a well:
             86          (i) for which production began on or after July 1, 1995; and
             87          (ii) attributable to interests:
             88          (A) held in trust by the United States for the Tribe and its members; or
             89          (B) on lands identified in Pub. L. No. 440, 62 Stat. 72 (1948); and


             90          (c) for taxes imposed under this part, 80% of taxes collected on oil, gas, or other
             91      hydrocarbon substances produced from a well:
             92          (i) for which production began on or after January 1, 2001; and
             93          (ii) attributable to interests on lands conveyed to the tribe under the Ute-Moab Land
             94      Restoration Act, Pub. L. No. 106-398, Sec. 3303.
             95          (2) (a) The maximum amount deposited in the Uintah Basin Revitalization Fund may
             96      not exceed:
             97          (i) $3,000,000 in fiscal year 2005-06;
             98          (ii) $5,000,000 in fiscal year 2006-07;
             99          (iii) $6,000,000 in fiscal years 2007-08 and 2008-09; and
             100          (iv) for fiscal years beginning with fiscal year 2009-10, the amount determined by the
             101      commission as described in Subsection (2)(b).
             102          (b) (i) The commission shall increase or decrease the dollar amount described in
             103      Subsection (2)(a)(iii) by a percentage equal to the percentage difference between the consumer
             104      price index for the preceding calendar year and the consumer price index for calendar year
             105      2008; and
             106          (ii) after making an increase or decrease under Subsection (2)(b)(i), round the dollar
             107      amount to the nearest whole dollar.
             108          (c) For purposes of this Subsection (2), "consumer price index" is as described in
             109      Section 1(f)(4), Internal Revenue Code, and defined in Section (1)(f)(5), Internal Revenue
             110      Code.
             111          (d) Any amounts in excess of the maximum described in Subsection (2)(a) shall be
             112      deposited [into the General Fund] as provided in Section 59-5-115 .
             113          Section 4. Section 59-5-119 is amended to read:
             114           59-5-119. Disposition of certain taxes collected on Navajo Nation land located in
             115      Utah.
             116          (1) Except as provided in Subsection (2), there shall be deposited into the Navajo
             117      Revitalization Fund established in Section 9-11-104 for taxes imposed under this part
             118      beginning on July 1, 1997:
             119          (a) 33% of the taxes collected on oil, gas, or other hydrocarbon substances produced
             120      from a well:


             121          (i) for which production began on or before June 30, 1996; and
             122          (ii) attributable to interests in Utah held in trust by the United States for the Navajo
             123      Nation and its members; and
             124          (b) 80% of the taxes collected on oil, gas, or other hydrocarbon substances produced
             125      from a well:
             126          (i) for which production began on or after July 1, 1996; and
             127          (ii) attributable to interests in Utah held in trust by the United States for the Navajo
             128      Nation and its members.
             129          (2) (a) The maximum amount deposited in the Navajo Revitalization Fund may not
             130      exceed:
             131          (i) $2,000,000 in fiscal year 2006-07; and
             132          (ii) $3,000,000 for fiscal years beginning with fiscal year 2007-08.
             133          (b) Any amounts in excess of the maximum described in Subsection (2)(a) shall be
             134      deposited [into the General Fund] as provided in Section 59-5-115 .
             135          Section 5. Section 59-5-121 is enacted to read:
             136          59-5-121. Deposit of certain revenues into Constitutional Defense Restricted
             137      Account.
             138          For each fiscal year beginning with fiscal year 2012-13, after the Division of Finance
             139      makes the deposits required by Sections 59-5-116 and 59-5-119 , the Division of Finance shall
             140      annually deposit revenues collected from a tax imposed under Section 59-5-102 into the
             141      Constitutional Defense Restricted Account equal to the difference between:
             142          (1) $6,000,000; and
             143          (2) the amounts required to be deposited into the Constitutional Defense Restricted
             144      Account for that fiscal year in accordance with Subsections 63C-4-103 (2)(a) and (e).
             145          Section 6. Section 63C-4-103 is amended to read:
             146           63C-4-103. Creation of Constitutional Defense Restricted Account -- Sources of
             147      funds -- Uses of funds -- Reports.
             148          (1) There is created a restricted account within the General Fund known as the
             149      Constitutional Defense Restricted Account.
             150          (2) The account consists of money from the following revenue sources:
             151          (a) money deposited [to] into the account as required by Section 53C-3-203 ;


             152          (b) voluntary contributions;
             153          (c) money received by the council from other state agencies; [and]
             154          (d) revenues deposited into the account in accordance with Section 59-5-121 ; and
             155          [(d)] (e) appropriations made by the Legislature.
             156          (3) The Legislature may annually appropriate money from the Constitutional Defense
             157      Restricted Account to one or more of the following:
             158          (a) the council for the council's or Federalism Subcommittee's duties established in this
             159      chapter;
             160          (b) the Public Lands Policy Coordinating Office to carry out its duties in Section
             161      63J-4-603 ;
             162          (c) the Office of the Governor, to be used only for the purpose of asserting, defending,
             163      or litigating state and local government rights under R.S. 2477, in accordance with a plan
             164      developed and approved as provided in Section 63C-4-104 ;
             165          (d) a county or association of counties to assist counties, consistent with the purposes
             166      of the council, in pursuing issues affecting the counties; or
             167          (e) the Office of the Attorney General, to be used only:
             168          (i) for public lands counsel and assistance and litigation to the state or local
             169      governments including asserting, defending, or litigating state and local government rights
             170      under R.S. 2477 in accordance with a plan developed and approved as provided in Section
             171      63C-4-104 ;
             172          (ii) for an action filed in accordance with Section 67-5-29 ; or
             173          (iii) to advise the council and Federalism Subcommittee.
             174          (4) (a) The council shall require that any entity that receives money from the
             175      Constitutional Defense Restricted Account provide financial reports and litigation reports to
             176      the council.
             177          (b) Nothing in this Subsection (4) prohibits the council from closing a meeting under
             178      Title 52, Chapter 4, Open and Public Meetings Act, or prohibits the council from complying
             179      with Title 63G, Chapter 2, Government Records Access and Management Act.





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