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Second Substitute H.B. 271

This document includes House Floor Amendments incorporated into the bill on Thu, Feb 28, 2013 at 5:00 PM by lerror. --> This document includes House Floor Amendments incorporated into the bill on Wed, Mar 6, 2013 at 11:46 AM by lerror. --> This document includes House Floor Amendments incorporated into the bill on Thu, Mar 7, 2013 at 10:37 AM by lerror. -->

Representative Jim Bird proposes the following substitute bill:




Chief Sponsor: Jim Bird

Senate Sponsor: ____________

             7      LONG TITLE
             8      General Description:
             9          This bill modifies the Alcoholic Beverage Control Act and the Funds Consolidation Act
             10      to allocate certain revenues from the sale of liquor to support public education.
             11      Highlighted Provisions:
             12          This bill:
             13          .    defines terms;
             14          . H. for liquor revenue collected during the 2012-13 fiscal year only, .H directs the
             14a      deposit of 25% of the growth in the amount of liquor revenues to the
             15      Education Fund;
             16          .    provides for the distribution of the liquor revenues to local educational agencies;
             17      and
             18          .    addresses money deposited into the Education Fund.
             19      Money Appropriated in this Bill:
             20          This bill appropriates:
             21          .    to the State Board of Education, as H. [ an ongoing ] a one-time .H appropriation:
             22              .    from the Education Fund, $7,461,600 subject to intent language that states that
             23      the appropriation is to be distributed as provided in statute.
             24      Other Special Clauses:
             25          This bill takes effect on July 1, 2013.

             26      Utah Code Sections Affected:
             27      AMENDS:
             28          32B-2-301, as last amended by Laws of Utah 2012, Chapter 357
             29          51-5-4, as last amended by Laws of Utah 2010, Chapter 278
             30      ENACTS:
             31          32B-2-307, Utah Code Annotated 1953
             33      Be it enacted by the Legislature of the state of Utah:
             34          Section 1. Section 32B-2-301 is amended to read:
             35           32B-2-301. State property -- Liquor Control Fund -- Markup Holding Fund.
             36          (1) The following are property of the state:
             37          (a) the money received in the administration of this title, except as otherwise provided;
             38      and
             39          (b) property acquired, administered, possessed, or received by the department.
             40          (2) (a) There is created an enterprise fund known as the "Liquor Control Fund."
             41          (b) Except as provided in Sections 32B-3-205 and 32B-2-304 , money received in the
             42      administration of this title shall be transferred to the Liquor Control Fund.
             43          (3) (a) There is created an enterprise fund known as the "Markup Holding Fund."
             44          (b) In accordance with Section 32B-2-304 , the State Tax Commission shall deposit
             45      revenue remitted to the State Tax Commission from the markup imposed under Section
             46      32B-2-304 into the Markup Holding Fund.
             47          (c) Money deposited into the Markup Holding Fund may be expended:
             48          (i) to the extent appropriated by the Legislature; and
             49          (ii) to fund the deposits required by Subsection 32B-2-304 (4) [and], Subsection
             50      32B-2-305 (4), and Subsection 32B-2-307 (2).
             51          (4) The state treasurer shall by warrant draw from the Liquor Control Fund and, to the
             52      extent appropriated by the Legislature, from the Markup Holding Fund, the expenses, debts,
             53      and liabilities incurred by the department in connection with the administration of this title or
             54      any other expense necessary for the administration of this title, including:
             55          (a) salaries;
             56          (b) premiums, if any, on a bond for which the department pays premiums; and

             57          (c) an expenditure incurred in establishing, operating, or maintaining a state store or
             58      package agency.
             59          (5) The department shall transfer annually from the Liquor Control Fund and the State
             60      Tax Commission shall transfer annually from the Markup Holding Fund to the General Fund a
             61      sum equal to the amount of net profit earned from the sale of liquor since the preceding transfer
             62      of money under this Subsection (5). The transfers shall be calculated by no later than
             63      September 1 and made by no later than September 30 after a fiscal year.
             64          (6) (a) By the end of each day, the department shall:
             65          (i) make a deposit to a qualified depository, as defined in Section 51-7-3 ; and
             66          (ii) report the deposit to the state treasurer.
             67          (b) A commissioner or department employee is not personally liable for a loss caused
             68      by the default or failure of a qualified depository.
             69          (c) Money deposited in a qualified depository is entitled to the same priority of
             70      payment as other public funds of the state.
             71          (7) If the cash balance of the Liquor Control Fund is not adequate to cover a warrant
             72      drawn against the Liquor Control Fund by the state treasurer, the cash resources of the General
             73      Fund may be used to the extent necessary. At no time may the fund equity of the Liquor
             74      Control Fund fall below zero.
             75          Section 2. Section 32B-2-307 is enacted to read:
             76      32B-2-307. H. [ is enacted to read:. ] Public education deposit of certain liquor profits. .H
             77          (1) As used in this section:
             78          (a) "Eligible liquor funds" means an amount equal to the difference between the
             79      amount of revenue collected from the total gross revenue from sales of liquor in:
             80          (i) the fiscal year H. [ one year preceding ] that is two years prior to .H the fiscal year
             80a      for which the deposit is made; and
             81          (ii) fiscal year 2010-11.
             82          (b) "Local education agency" means a local education agency in Utah that has
             83      administrative control and direction for public education.
             84          (c) "Weighted pupil units H. " .H or H. " .H WPUs" is as defined in
             84a      Section 53A-17a-103 .
             85          (2) H. [ The ] For liquor revenue collected in fiscal year 2012-13 only, the .H Division
             85a      of Finance shall deposit 25% of eligible liquor funds from the
             86      Markup Holding Fund described in Section 32B-2-301 H. [ , ] .H with the state treasurer
             86a      to be credited to
             87      the Education Fund to be distributed to local education agencies as provided in Subsection (3).

             88          (3) For H. [ a ] the .H fiscal year beginning on H. [ or after ] .H July 1, 2013
             88a      H. only .H , the State Board of Education
             89      shall H. [ annually ] .H distribute the eligible funds described in Subsection (2) on or after
             89a      October 1 of
             90      the fiscal year to local education agencies based on the number of WPUs in the local education
             91      agency on the previous October 1 as compared to the state total.
             92          Section 3. Section 51-5-4 is amended to read:
             93           51-5-4. Funds established -- Titles of funds -- Fund functions.
             94          (1) (a) (i) The funds enumerated in this section are established as major fund types.
             95          (ii) All resources and financial transactions of Utah state government shall be
             96      accounted for within one of these major fund types.
             97          (b) (i) All funds or subfunds shall be consolidated into one of the state's major fund
             98      types.
             99          (ii) Where a specific statute requires that a restricted fund or account be established,
             100      that fund or account shall be accounted for as an individual fund, subfund, or account within
             101      the major fund type to meet generally accepted accounting principles.
             102          (iii) Existing and new activities of state government authorized by the Legislature shall
             103      be accounted for within the framework of the major fund types established in this section.
             104          (c) The Division of Finance shall determine the accounting classification that complies
             105      with generally accepted accounting principles for all funds, subfunds, or accounts created by
             106      the Legislature.
             107          (d) (i) Major fund types shall be added by amending this chapter.
             108          (ii) Whenever a new act creates or establishes a fund, subfund, or account without
             109      amending this chapter, the reference to a fund, subfund, or account in the new act shall be
             110      classified within one of the major fund types established by this section.
             111          (2) Major Fund Type Titles:
             112          (a) General Fund;
             113          (b) Special Revenue Funds;
             114          (c) Capital Projects Funds;
             115          (d) Debt Service Funds;
             116          (e) Permanent Funds;
             117          (f) Enterprise Funds;
             118          (g) Internal Service Funds;

             119          (h) Trust and Agency Funds; and
             120          (i) Discrete Component Unit Funds.
             121          (3) The General Fund shall receive all revenues and account for all expenditures not
             122      otherwise provided for by law in any other fund.
             123          (4) Special Revenue Funds account for proceeds of specific revenue sources, other than
             124      permanent funds, trust and agency funds, or major capital projects, that are legally restricted to
             125      expenditures for a specific purpose.
             126          (a) The Education Fund is a Special Revenue Fund that:
             127          (i) receives all revenues from taxes on intangible property [or], from a tax on income,
             128      or money given to the fund under law; and
             129          (ii) is designated for public and higher education.
             130          (b) The Transportation Investment Fund of 2005 is a Special Revenue Fund that
             131      accounts for revenues that are required by law to be expended for the maintenance,
             132      construction, reconstruction, or renovation of certain state and federal highways.
             133          (c) The Transportation Fund is a Special Revenue Fund that accounts for all revenues
             134      that are required by law to be expended for highway purposes.
             135          (d) (i) A Restricted Special Revenue Fund is a Special Revenue Fund created by
             136      legislation or contractual relationship with parties external to the state that:
             137          (A) identifies specific revenues collected from fees, taxes, dedicated credits, donations,
             138      federal funds, or other sources;
             139          (B) defines the use of the money in the fund for a specific function of government or
             140      program within an agency; and
             141          (C) delegates spending authority or authorization to use the fund's assets to a governing
             142      board, administrative department, or other officials as defined in the enabling legislation or
             143      contract establishing the fund.
             144          (ii) A Restricted Special Revenue Fund may only be created by contractual relationship
             145      with external parties when the sources of revenue for the fund are donated revenues or federal
             146      revenues.
             147          (iii) Restricted Special Revenue Funds are subject to annual legislative review by the
             148      appropriate legislative appropriations subcommittee.
             149          (5) Capital Projects Funds account for financial resources to be expended for the

             150      acquisition or construction of major capital facilities, except that when financing for the
             151      acquisition or construction of a major capital facility is obtained from a trust fund or a
             152      proprietary type fund within one of the major fund types, the money shall be accounted for in
             153      those accounts.
             154          (6) Debt Service Funds account for the accumulation of resources for, and the payment
             155      of, the principal and interest on general long-term obligations.
             156          (7) Permanent Funds account for assets that are legally restricted to the extent that only
             157      earnings, and not principal, may be used for a specific purpose.
             158          (8) Enterprise Funds are designated to account for the following:
             159          (a) operations, financed and operated in a manner similar to private business
             160      enterprises, where the Legislature intends that the costs of providing goods or services to the
             161      public are financed or recovered primarily through user charges;
             162          (b) operations where the Legislature requires periodic determination of revenues
             163      earned, expenses incurred, and net income;
             164          (c) operations for which a fee is charged to external users for goods or services; or
             165          (d) operations that are financed with debt that is secured solely by a pledge of the net
             166      revenues from fees and charges of the operations.
             167          (9) Internal Service Funds account for the financing of goods or services provided by
             168      one department, division, or agency to other departments, divisions, or agencies of the state, or
             169      to other governmental units, on a cost-reimbursement basis.
             170          (10) (a) Trust and Agency Funds account for assets held by the state as trustee or agent
             171      for individuals, private organizations, or other governmental units.
             172          (b) Pension Trust Funds, Investment Trust Funds, Private-Purpose Trust Funds, and
             173      Agency Funds are Trust and Agency Funds.
             174          (11) Discrete Component Unit Funds account for the financial resources used to
             175      operate the state's colleges and universities and other discrete component units.
             176          Section 4. Appropriation.
             177          Under the terms and conditions of Title 63J, Chapter 1, Budgetary Procedures Act, for
             178      the fiscal year beginning July 1, 2013, and ending June 30, 2014, the following sums of money
             179      are appropriated from resources not otherwise appropriated, or reduced from amounts
             180      previously appropriated, out of the funds or accounts indicated. These sums of money are in

             181      addition to any amounts previously appropriated for fiscal year 2014.
             182          To Related to Basic Programs
             183          From Education Fund H. , one-time .H
             184          Schedule of Programs:
             185              Liquor Revenues Allocation                $7,461,600
             186          It is the intent of the Legislature that the State Board of Education shall allocate the
             187      money appropriated under this item in accordance with Section 32B-2-307 .
             188          Section 5. Effective date.
             189          This bill takes effect on July 1, 2013.

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