H.B. 356

             1     

NEW CONVENTION HOTEL DEVELOPMENT INCENTIVE

             2     
PROVISIONS

             3     
2014 GENERAL SESSION

             4     
STATE OF UTAH

             5     
Chief Sponsor: Brad R. Wilson

             6     
Senate Sponsor: ____________

             7      Cosponsor:Rebecca D. Lockhart              8     
             9      LONG TITLE
             10      General Description:
             11          This bill enacts provisions relating to incentives for the development of a new
             12      convention hotel.
             13      Highlighted Provisions:
             14          This bill:
             15          .    enacts the New Convention Hotel Development Incentive Act;
             16          .    establishes a tax credit for the owner of a new convention hotel or a local
             17      government entity, under certain circumstances, in the amount of state and local
             18      sales tax revenue generated from sales related to the construction of a new
             19      convention hotel and from sales on hotel property, and other local taxes;
             20          .    establishes requirements and criteria for qualifying for a tax credit;
             21          .    establishes a process for applying for and the issuance of a tax credit certificate,
             22      including an agreement between the Governor's Office of Economic Development
             23      and the hotel owner or local government in which the hotel is located;
             24          .    authorizes a community development and renewal agency of a host local
             25      government to receive incremental property tax revenue generated from hotel
             26      property during the eligibility period;


             27          .    limits how money derived from a tax credit and incremental property tax revenue
             28      may be spent;
             29          .    establishes an independent review committee to review tax credit applications;
             30          .    grants the Governor's Office of Economic Development rulemaking authority to
             31      carry out its responsibilities under and to implement provisions of this bill;
             32          .    requires a county in which a new convention hotel is located to make an annual
             33      payment into the Stay Another Day and Bounce Back Account;
             34          .    creates the Stay Another Day and Bounce Back Account as a restricted account in
             35      the General Fund; and
             36          .    modifies the duties and authority of the Board of Tourism Development.
             37      Money Appropriated in this Bill:
             38          None
             39      Other Special Clauses:
             40          This bill provides effective dates.
             41      Utah Code Sections Affected:
             42      AMENDS:
             43           63M-1-1403 , as renumbered and amended by Laws of Utah 2008, Chapter 382
             44      ENACTS:
             45           17-31-9 , Utah Code Annotated 1953
             46           59-7-616 , Utah Code Annotated 1953
             47           59-10-1110 , Utah Code Annotated 1953
             48           63M-1-3401 , Utah Code Annotated 1953
             49           63M-1-3402 , Utah Code Annotated 1953
             50           63M-1-3403 , Utah Code Annotated 1953
             51           63M-1-3404 , Utah Code Annotated 1953
             52           63M-1-3405 , Utah Code Annotated 1953
             53           63M-1-3406 , Utah Code Annotated 1953
             54           63M-1-3407 , Utah Code Annotated 1953
             55           63M-1-3408 , Utah Code Annotated 1953
             56           63M-1-3409 , Utah Code Annotated 1953
             57           63M-1-3410 , Utah Code Annotated 1953


             58           63M-1-3411 , Utah Code Annotated 1953
             59           63M-1-3412 , Utah Code Annotated 1953
             60     
             61      Be it enacted by the Legislature of the state of Utah:
             62          Section 1. Section 17-31-9 is enacted to read:
             63          17-31-9. Payment to Stay Another Day and Bounce Back Account.
             64          A county in which a qualified hotel, as defined in Section 63M-1-3402 , is located shall
             65      make an annual payment to the Division of Finance:
             66          (1) for deposit into the Stay Another Day and Bounce Back Account, established in
             67      Section 63M-1-3411 ;
             68          (2) for any year in which the Governor's Office of Economic Development issues a tax
             69      credit certificate, as defined in Section 63M-1-3402 ; and
             70          (3) in the amount of 5% of the state portion, as defined in Section 63M-1-3402 , of the
             71      tax credit, as defined in Section 63M-1-3402 , awarded by the tax credit certificate.
             72          Section 2. Section 59-7-616 is enacted to read:
             73          59-7-616. Refundable tax credit for certain business entities.
             74          (1) As used in this section:
             75          (a) "Eligibility period" has the same meaning as defined in Section 63M-1-3402 .
             76          (b) "Office" means the Governor's Office of Economic Development.
             77          (c) "Pass-through entity" has the same meaning as defined in Section 59-10-1402 .
             78          (d) "Pass-through entity taxpayer" has the same meaning as defined in Section
             79      59-10-1402 .
             80          (e) "Tax credit certificate" has the same meaning as defined in Section 63M-1-3402 .
             81          (f) "Tax credit recipient" has the same meaning as defined in Section 63M-1-3402 .
             82          (2) (a) Subject to the other provisions of this section, a tax credit recipient that is a
             83      corporation may claim a refundable tax credit as provided in Subsection (3).
             84          (b) If the tax credit recipient is a pass-through entity, the pass-through entity shall pass
             85      through to one or more pass-through entity taxpayers of the pass-through entity, in accordance
             86      with Chapter 10, Part 14, Pass-Through Entities and Pass-Through Entity Taxpayers Act, a
             87      refundable tax credit that the tax credit recipient could otherwise claim under this section.
             88          (3) The amount of a tax credit is the amount listed as the tax credit amount on the tax


             89      credit certificate that the office issues to the tax credit recipient for the taxable year.
             90          (4) A tax credit recipient:
             91          (a) may claim or pass through a tax credit in a taxable year other than the taxable year
             92      during which the tax credit recipient has been issued a tax credit certificate; and
             93          (b) may not claim a tax credit under both this section and Section 59-7-1110 .
             94          (5) (a) In accordance with any rules prescribed by the commission under Subsection
             95      (5)(b), the commission shall:
             96          (i) make a refund to a tax credit recipient that claims a tax credit under this section if
             97      the amount of the tax credit exceeds the tax credit recipient's tax liability under this chapter;
             98      and
             99          (ii) transfer at least annually from the General Fund into the Education Fund an amount
             100      equal to the amount of tax credit claimed under this section.
             101          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             102      commission may make rules providing procedures for making:
             103          (i) a refund to a tax credit recipient or pass-through entity taxpayer as required by
             104      Subsection (5)(a)(i); or
             105          (ii) transfers from the General Fund into the Education Fund as required by Subsection
             106      (5)(a)(ii).
             107          Section 3. Section 59-10-1110 is enacted to read:
             108          59-10-1110. Refundable tax credit for certain business entities.
             109          (1) As used in this section:
             110          (a) "Eligibility period" has the same meaning as defined in Section 63M-1-3402 .
             111          (b) "Office" means the Governor's Office of Economic Development.
             112          (c) "Pass-through entity" has the same meaning as defined in Section 59-10-1402 .
             113          (d) "Pass-through entity taxpayer" has the same meaning as defined in Section
             114      59-10-1402 .
             115          (e) "Tax credit certificate" has the same meaning as defined in Section 63M-1-3402 .
             116          (f) "Tax credit recipient" has the same meaning as defined in Section 63M-1-3402 .
             117          (2) (a) Subject to the other provisions of this section, a tax credit recipient may claim a
             118      refundable tax credit as provided in Subsection (3).
             119          (b) If the tax credit recipient is a pass-through entity, the pass-through entity shall pass


             120      through to one or more pass-through entity taxpayers of the pass-through entity, in accordance
             121      with Chapter 10, Part 14, Pass-Through Entities and Pass-Through Entity Taxpayers Act, a
             122      refundable tax credit that the tax credit recipient could otherwise claim under this section.
             123          (3) The amount of a tax credit is the amount listed as the tax credit amount on the tax
             124      credit certificate that the office issues to the tax credit recipient for the taxable year.
             125          (4) A tax credit recipient:
             126          (a) may claim or pass through a tax credit in a taxable year other than the taxable year
             127      during which the tax credit recipient has been issued a tax credit certificate; and
             128          (b) may not claim a tax credit under both this section and Section 59-7-616 .
             129          (5) (a) In accordance with any rules prescribed by the commission under Subsection
             130      (5)(b), the commission shall:
             131          (i) make a refund to a tax credit recipient that claims a tax credit under this section if
             132      the amount of the tax credit exceeds the tax credit recipient's tax liability under this chapter;
             133      and
             134          (ii) transfer at least annually from the General Fund into the Education Fund an amount
             135      equal to the amount of tax credit claimed under this section.
             136          (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
             137      commission may make rules providing procedures for making:
             138          (i) a refund to a tax credit recipient or pass-through entity taxpayer as required by
             139      Subsection (5)(a)(i); or
             140          (ii) transfers from the General Fund into the Education Fund as required by Subsection
             141      (5)(a)(ii).
             142          Section 4. Section 63M-1-1403 is amended to read:
             143           63M-1-1403. Board duties.
             144          (1) The board shall:
             145          (a) have authority to approve a tourism program of out-of-state advertising, marketing,
             146      and branding, taking into account the long-term strategic plan, economic trends, and
             147      opportunities for tourism development on a statewide basis, as a condition of the distribution of
             148      funds to the office from the Tourism Marketing Performance Account under Section
             149      63M-1-1406 ;
             150          (b) have authority to approve a tourism program of advertising, marketing, and


             151      branding of the state, taking into account the long-term strategic plan, economic trends, and
             152      opportunities for tourism development on a statewide basis, as a condition of the distribution of
             153      money to the office from the Stay Another Day and Bounce Back Account, created in Section
             154      63M-1-3411 ;
             155          [(b)] (c) review the office programs for coordination and integration of advertising and
             156      branding themes to be used whenever possible in all office programs, including recreational,
             157      scenic, historic, and tourist attractions of the state at large;
             158          [(c)] (d) encourage and assist in coordination of the activities of persons, firms,
             159      associations, corporations, civic groups, and governmental agencies engaged in publicizing,
             160      developing, and promoting the scenic attractions and tourist advantages of the state; and
             161          [(d)] (e) (i) advise the office in establishing a Cooperative Program from the money in
             162      the Tourism Marketing Performance Account under Section 63M-1-1406 for use by cities,
             163      counties, nonprofit destination marketing organizations, and similar public entities for the
             164      purpose of supplementing money committed by these entities for advertising and promotion to
             165      and for out-of-state residents to attract them to visit sites advertised by and attend events
             166      sponsored by these entities;
             167          (ii) the Cooperative Program shall be allocated 20% of the revenues appropriated to the
             168      office from the Tourism Marketing Performance Account;
             169          (iii) the office, with approval from the board, shall establish eligibility, advertising, and
             170      timing requirements and criteria and provide for an approval process for applications;
             171          (iv) an application from an eligible applicant to receive money from the Cooperative
             172      Program must be submitted on or before the appropriate date established by the office; and
             173          (v) Cooperative Program money not used in each fiscal year shall be returned to the
             174      Tourism Marketing Performance Account.
             175          (2) The board may:
             176          (a) solicit and accept contributions of money, services, and facilities from any other
             177      sources, public or private and shall use these funds for promoting the general interest of the
             178      state in tourism; and
             179          (b) establish subcommittees for the purpose of assisting the board in an advisory role
             180      only.
             181          (3) The board may not, except as otherwise provided in Subsection (1)(a), make policy


             182      related to the management or operation of the office.
             183          Section 5. Section 63M-1-3401 is enacted to read:
             184     
Part 34. New Convention Hotel Development Incentive Act

             185          63M-1-3401. Title.
             186          This part is known as the "New Convention Hotel Development Incentive Act."
             187          Section 6. Section 63M-1-3402 is enacted to read:
             188          63M-1-3402. Definitions.
             189          As used in this part:
             190          (1) "Agreement" means an agreement described in Section 63M-1-3403 .
             191          (2) "Commission" means the Utah State Tax Commission.
             192          (3) "Committee" means the independent review committee established as provided in
             193      Subsection 63M-1-3404 (1).
             194          (4) "Community development and renewal agency" has the same meaning as defined in
             195      Section 17C-1-102 .
             196          (5) "Eligibility period" means:
             197          (a) the period that:
             198          (i) begins the date construction of a qualified hotel begins, and
             199          (ii) ends 20 years after the date of initial occupancy of that qualified hotel; or
             200          (b) as provided in an agreement between the office and a qualified hotel owner or host
             201      local government, a period that:
             202          (i) begins no earlier than the date construction of a qualified hotel begins; and
             203          (ii) is shorter than the period described in Subsection (5)(a).
             204          (6) "Host agency" means the community development and renewal agency of the host
             205      local government.
             206          (7) "Host local government" means:
             207          (a) a county that enters into an agreement with the office for the construction of a
             208      qualified hotel within the unincorporated area of the county; or
             209          (b) a city or town that enters into an agreement with the office for the construction of a
             210      qualified hotel within the boundary of the city or town.
             211          (8) "Hotel property" means a qualified hotel and any property that is included in the
             212      same development as the qualified hotel, including convention, exhibit, and meeting space,


             213      retail shops, restaurants, parking, and other ancillary facilities and amenities.
             214          (9) "Incremental property tax revenue" means the amount of property tax revenue
             215      generated from hotel property that equals the difference between:
             216          (a) the amount of property tax revenue generated in any tax year by all taxing entities
             217      from hotel property, using the current assessed value of the hotel property; and
             218          (b) the amount of property tax revenue that would be generated that tax year by all
             219      taxing entities from hotel property, using a base taxable value of the hotel property as
             220      established by the county in which the hotel property is located.
             221          (10) "Local portion" means the portion of new tax revenue that is not the state portion.
             222          (11) "New tax revenue" means:
             223          (a) all incremental new revenue generated from a tax under Title 59, Chapter 12, Sales
             224      and Use Tax Act, on transactions occurring during the eligibility period as a result of the
             225      construction of a qualified hotel, including purchases made by a qualified hotel owner and its
             226      subcontractors; and
             227          (b) all incremental new revenue generated from a tax under Title 59, Chapter 12, Sales
             228      and Use Tax Act, on transactions occurring on hotel property during the eligibility period.
             229          (12) "Public infrastructure" means:
             230          (a) water, sewer, storm drainage, electrical, telecommunications, and other similar
             231      systems and lines;
             232          (b) streets, roads, curbs, gutters, sidewalks, walkways, parking facilities, and public
             233      transportation facilities; and
             234          (c) other buildings, facilities, infrastructure, and improvements that benefit the public.
             235          (13) "Qualified hotel" means a single, full-service hotel constructed in the state on or
             236      after July 1, 2014 that:
             237          (a) requires a significant capital investment;
             238          (b) includes at least 85 square feet of convention, exhibit, and meeting space per guest
             239      room; and
             240          (c) is located within 1,000 feet of a convention center that contains at least 500,000
             241      square feet of convention, exhibit, and meeting space.
             242          (14) "Qualified hotel owner" means a person who owns a qualified hotel.
             243          (15) "Significant capital investment" means an amount of at least $200,000,000.


             244          (16) "State portion" means the portion of new tax revenue that is attributable to a tax
             245      imposed under Subsection 59-12-103 (2)(a)(i)(A).
             246          (17) "Tax credit" means a tax credit under Section 59-7-616 or 59-10-1110 .
             247          (18) "Tax credit amount" means the amount the office lists as a tax credit on a tax
             248      credit certificate.
             249          (19) "Tax credit applicant" means a qualified hotel owner or host local government
             250      that:
             251          (a) has entered into an agreement with the office; and
             252          (b) pursuant to that agreement, submits an application for the issuance of a tax credit
             253      certificate.
             254          (20) "Tax credit certificate" means a certificate issued by the office that includes:
             255          (a) the name of the tax credit recipient;
             256          (b) the tax credit recipient's taxpayer identification number;
             257          (c) the tax credit amount authorized under this part for a taxable year; and
             258          (d) other information as determined by the office.
             259          (21) "Tax credit recipient" means a tax credit applicant that has been issued a tax credit
             260      certificate.
             261          Section 7. Section 63M-1-3403 is enacted to read:
             262          63M-1-3403. Agreement for development of new convention hotel -- Tax credit
             263      authorized -- Agreement requirements.
             264          (1) The office, with the board's advice, may enter into an agreement with a qualified
             265      hotel owner or a host local government:
             266          (a) for the development of a qualified hotel; and
             267          (b) to authorize a tax credit:
             268          (i) to the qualified hotel owner or host local government, but not both;
             269          (ii) for a period not to exceed the eligibility period; and
             270          (iii) if all applicable requirements of this part and the agreement are met.
             271          (2) An agreement shall:
             272          (a) specify the requirements for a tax credit recipient to qualify for a tax credit;
             273          (b) with respect to the state portion of any tax credit that the tax credit recipient may
             274      receive during the eligibility period:


             275          (i) specify the maximum dollar amount that the tax credit recipient may receive,
             276      subject to a maximum of:
             277          (A) for any taxable year, the amount of the state portion of new tax revenue in that
             278      taxable year; and
             279          (B) $75,000,000 in the aggregate for any tax credit recipient during an eligibility
             280      period; and
             281          (ii) specify the maximum percentage of the state portion of new tax revenue that may
             282      be used in calculating a tax credit that a tax credit recipient may receive during the eligibility
             283      period for each taxable year and in the aggregate;
             284          (c) establish a shorter period of time than the period described in Subsection
             285      63M-1-3402 (5)(a) during which the tax credit recipient may claim a tax credit or that the host
             286      agency may be paid incremental property tax revenue, if the office and qualified hotel owner or
             287      host local government agree to a shorter period of time;
             288          (d) require the tax credit recipient to retain books and records supporting a claim for a
             289      tax credit as required by Section 59-1-1406 ;
             290          (e) allow the transfer of the agreement to a third party if the third party assumes all
             291      liabilities and responsibilities in the agreement;
             292          (f) limit the expenditure of funds received under a tax credit as provided in Section
             293      63M-1-3412 ; and
             294          (g) require the tax credit recipient to submit to any audit the office considers
             295      appropriate for verification of any tax credit or claimed tax credit.
             296          Section 8. Section 63M-1-3404 is enacted to read:
             297          63M-1-3404. Independent review committee.
             298          (1) In accordance with rules adopted by the office under Section 63M-1-3408 , the
             299      board shall establish a separate, independent review committee to review each initial tax credit
             300      application submitted under this part for compliance with the requirements of this part and the
             301      agreement.
             302          (2) The committee shall consist of:
             303          (a) one member appointed by the director to represent the office;
             304          (b) two members appointed by the mayor or chief executive of the county in which the
             305      qualified hotel is located or proposed to be located;


             306          (c) two members appointed by:
             307          (i) the mayor of the municipality in which the qualified hotel is located or proposed to
             308      be located, if the qualified hotel is located or proposed to be located within the boundary of a
             309      municipality; or
             310          (ii) the mayor or chief executive of the county in which the qualified hotel is located or
             311      proposed to be located, in addition to the two members appointed under Subsection (2)(b), if
             312      the qualified hotel is located or proposed to be located outside the boundary of a municipality;
             313          (d) an individual representing the hotel industry, appointed by the Utah Hotel and
             314      Lodging Association;
             315          (e) an individual representing the commercial development and construction industry,
             316      appointed by the president or chief executive officer of the local chamber of commerce;
             317          (f) an individual representing the convention and meeting planners industry, appointed
             318      by the president or chief executive officer of the local convention and visitors bureau ; and
             319          (g) one member appointed by the board.
             320          (3) (a) A member serves an indeterminate term and may be removed from the
             321      committee by the appointing authority at any time.
             322          (b) A vacancy may be filled in the same manner as an appointment under Subsection
             323      (2).
             324          (4) A member of the committee may not be paid for serving on the committee and may
             325      not receive per diem or expense reimbursement.
             326          (5) The office shall provide any necessary staff support to the committee.
             327          Section 9. Section 63M-1-3405 is enacted to read:
             328          63M-1-3405. Submission of written application for tax credit certificate --
             329      Disclosure of tax returns and other information -- Determination of tax credit
             330      application.
             331          (1) For each taxable year for which a tax credit applicant seeks the issuance of a tax
             332      credit certificate, the tax credit applicant shall submit to the office:
             333          (a) a written application for a tax credit certificate;
             334          (b) (i) for an application submitted by a qualified hotel owner:
             335          (A) a certification by the individual signing the application that the individual is duly
             336      authorized to sign the application on behalf of the qualified hotel owner;


             337          (B) documentation of the new tax revenue generated during the preceding year;
             338          (C) a document in which the qualified hotel owner expressly directs and authorizes the
             339      commission to disclose to the office the qualified hotel owner's tax returns and other
             340      information that would otherwise be subject to confidentiality under Section 59-1-403 or
             341      Section 6103, Internal Revenue Code;
             342          (D) a document in which the qualified hotel's direct vendors, lessees, or subcontractors,
             343      as applicable, expressly direct and authorize the commission to disclose to the office the tax
             344      returns and other information of those vendors, lessees, or subcontractors that would otherwise
             345      be subject to confidentiality under Section 59-1-403 or Section 6103, Internal Revenue Code;
             346      and
             347          (E) documentation verifying that the qualified hotel owner has satisfied the
             348      performance benchmarks outlined in the agreement;
             349          (ii) for an application submitted by a host local government, documentation of the new
             350      tax revenue generated during the preceding year;
             351          (c) if the host local government intends to assign the tax credit sought in the tax credit
             352      application to a community development and renewal agency:
             353          (i) the taxpayer identification number of the community development and renewal
             354      agency; and
             355          (ii) a document signed by the governing body members of the community development
             356      and renewal agency that expressly directs and authorizes the commission to disclose to the
             357      office the agency's tax returns and other information that would otherwise be subject to
             358      confidentiality under Section 59-1-403 or Section 6103, Internal Revenue Code; and
             359          (d) a statement provided by an independent certified public accountant, at the tax credit
             360      applicant's expense, attesting to the accuracy of the documentation of new tax revenue.
             361          (2) (a) The office shall submit to the commission the documents described in
             362      Subsections (1)(b)(i)(C) and (1)(c)(ii) authorizing disclosure of the tax returns and other
             363      information.
             364          (b) Upon receipt of the documents described in Subsection (2)(a), the commission shall
             365      provide the office the tax returns and other information described in those documents.
             366          (3) If the office determines that the tax returns and other information is inadequate to
             367      validate the issuance of a tax credit certificate, the office shall inform the tax credit applicant


             368      that the tax returns and other information were inadequate and request the tax credit applicant
             369      to submit additional documentation to validate the issuance of a tax credit certificate.
             370          (4) If the office determines that the returns and other information, including any
             371      additional documentation provided under Subsection (3), provide reasonable justification for
             372      the issuance of a tax credit certificate, the office shall:
             373          (a) determine the amount of the tax credit to be listed on the tax credit certificate;
             374          (b) issue a tax credit certificate to the tax credit applicant for the amount of that tax
             375      credit; and
             376          (c) provide a copy of the tax credit certificate to the commission.
             377          Section 10. Section 63M-1-3406 is enacted to read:
             378          63M-1-3406. Effect of tax credit certificate -- Retaining tax credit certificate.
             379          (1) A person may not claim a tax credit unless the office has issued the person a tax
             380      credit certificate.
             381          (2) A tax credit recipient may claim a tax credit in the amount of the tax credit stated in
             382      a tax credit certificate.
             383          (3) A tax credit recipient shall retain the tax credit certificate in accordance with the
             384      requirements of Section 59-1-1406 for retaining books and records.
             385          (4) The amount of a tax credit indicated on a tax credit certificate issued during the
             386      eligibility period may not exceed the amount of eligible new tax revenue generated during the
             387      taxable year preceding the taxable year for which the tax credit certificate is issued.
             388          Section 11. Section 63M-1-3407 is enacted to read:
             389          63M-1-3407. Assigning tax credit.
             390          (1) A host local government that enters into an agreement with the office may, by
             391      resolution, assign a tax credit to a community development and renewal agency, in accordance
             392      with rules adopted by the office.
             393          (2) A host local government that adopts a resolution assigning a tax credit under
             394      Subsection (1) shall provide a copy of the resolution to the office and the commission.
             395          Section 12. Section 63M-1-3408 is enacted to read:
             396          63M-1-3408. Payment of incremental property tax revenue.
             397          (1) (a) In accordance with rules adopted by the office, a host agency shall be paid
             398      incremental property tax revenue during the eligibility period.


             399          (b) Incremental property tax revenue may be used only to pay for public infrastructure
             400      associated with hotel property.
             401          (2) A county that collects property tax on hotel property during the eligibility period
             402      shall pay and distribute to the host agency the incremental property tax revenue that the host
             403      agency is entitled to collect under Subsection (1), in the manner and at the time provided in
             404      Section 59-2-1365 .
             405          Section 13. Section 63M-1-3409 is enacted to read:
             406          63M-1-3409. Rulemaking authority -- Requirements for rules.
             407          (1) The office shall, in accordance with Title 63G, Chapter 3, Utah Administrative
             408      Rulemaking Act, make rules to carry out its responsibilities under this part and to implement
             409      the provisions of this part.
             410          (2) The rules the office makes under Subsection (1) shall:
             411          (a) establish, consistent with this part, the conditions that a tax credit applicant is
             412      required to meet to qualify for a tax credit;
             413          (b) require that a significant capital investment be made in the development of the
             414      hotel property;
             415          (c) require a tax credit applicant to meet all applicable requirements in order to receive
             416      a tax credit certificate; and
             417          (d) provide for the establishment of an independent review committee, consistent with
             418      the requirements of Section 63M-1-3404 .
             419          Section 14. Section 63M-1-3410 is enacted to read:
             420          63M-1-3410. Report by office -- Posting of report.
             421          (1) Before November 1 of each year, the office shall submit a written report to the
             422      Economic Development and Workforce Services Interim Committee of the Legislature, the
             423      Governor's Office of Management and Budget, and the Office of the Legislative Fiscal Analyst
             424      describing:
             425          (a) the state's success in attracting new conventions and corresponding new state
             426      revenue;
             427          (b) the estimated amount of tax credit commitments and the associated calculation
             428      made by the office and the period of time over which tax credits are expected to be paid;
             429          (c) the economic impact on the state related to generating new state revenue and


             430      providing tax credits; and
             431          (d) the estimated and actual costs and economic benefits of the tax credit commitments
             432      that the office made.
             433          (2) The office shall post the annual report under Subsection (1) on its website and on a
             434      state website.
             435          Section 15. Section 63M-1-3411 is enacted to read:
             436          63M-1-3411. Stay Another Day and Bounce Back Account.
             437          (1) As used in this section:
             438          (a) "Account" means the Stay Another Day and Bounce Back Account, established in
             439      Subsection (2).
             440          (b) "Board" means the Board of Tourism Development created in Section 63M-1-1401 .
             441          (2) There is created within the General Fund a restricted account known as the Stay
             442      Another Day and Bounce Back Account.
             443          (3) The account shall:
             444          (a) be administered by the board;
             445          (b) earn interest; and
             446          (c) be funded by:
             447          (i) annual payments under Section 17-31-9 from the county in which a qualified hotel
             448      is located; and
             449          (ii) any money that the Legislature chooses to appropriate to the account.
             450          (4) Interest earned by the account shall be deposited into the account.
             451          (5) The board may use money in the account to pay for a tourism program of
             452      advertising, marketing, and branding of the state, taking into consideration the long-term
             453      strategic plan, economic trends, and opportunities for tourism development on a statewide
             454      basis.
             455          (6) The Division of Finance shall:
             456          (a) certify money deposited into the account as set aside for the account; and
             457          (b) report money deposited into the account to the Office of the Legislative Fiscal
             458      Analyst.
             459          Section 16. Section 63M-1-3412 is enacted to read:
             460          63M-1-3412. Authorized expenditures of tax credit money.


             461          (1) A tax credit recipient may spend money received as a direct result of the state
             462      portion of a tax credit only for the purchase of or payment for, or reimbursement of a previous
             463      purchase of or payment for:
             464          (a) tangible personal property used in the construction of convention, exhibit, or
             465      meeting space on hotel property; or
             466          (b) tangible personal property that, upon the construction of hotel property, becomes
             467      affixed to hotel property as real property.
             468          (2) A tax credit recipient may spend money received as a direct result of the local
             469      portion of a tax credit only for:
             470          (a) a purpose described in Subsection (1);
             471          (b) public infrastructure; and
             472          (c) other purposes as approved by the host agency.
             473          Section 17. Effective date.
             474          (1) Except as provided in Subsection (2), this bill takes effect May 13, 2014.
             475          (2) Sections 59-7-616 and 59-10-1110 take effect for a taxable year beginning on or
             476      after January 1, 2015.




Legislative Review Note
    as of 2-14-14 3:49 PM


Office of Legislative Research and General Counsel


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