7 LONG TITLE
8 General Description:
9 This bill modifies parts of the Utah Code to make technical corrections, including
10 eliminating references to repealed provisions, making minor wording changes, updating
11 cross-references, and correcting numbering.
12 Highlighted Provisions:
13 This bill:
14 . modifies parts of the Utah Code to make technical corrections, including
15 eliminating references to repealed provisions, making minor wording changes,
16 updating cross-references, correcting numbering, and fixing errors that were created
17 from the previous year's session.
18 Money Appropriated in this Bill:
20 Other Special Clauses:
21 This bill provides effective dates.
22 Utah Code Sections Affected:
24 4-20-3 , as last amended by Laws of Utah 2012, Chapter 331
25 4-32-11 , as last amended by Laws of Utah 2010, Chapter 242
26 4-37-202 , as last amended by Laws of Utah 2010, Chapter 378
27 4-37-302 , as last amended by Laws of Utah 2010, Chapter 378
28 4-39-401 , as enacted by Laws of Utah 1997, Chapter 302
29 7-1-103 , as last amended by Laws of Utah 2013, Chapter 73
30 7-1-403 , as last amended by Laws of Utah 1986, Fourth Special Session, Chapter 1
31 7-1-616 , as last amended by Laws of Utah 1996, Chapter 182
32 7-1-703 , as last amended by Laws of Utah 1995, Chapter 49
33 7-1-710 , as enacted by Laws of Utah 1983, Chapter 8
34 7-1-802 , as last amended by Laws of Utah 2000, Chapter 260
35 7-2-1 , as last amended by Laws of Utah 1994, Chapter 200
36 7-2-2 , as last amended by Laws of Utah 1994, Chapter 200
37 7-2-12 , as last amended by Laws of Utah 2010, Chapter 378
38 7-3-1 , as enacted by Laws of Utah 1981, Chapter 16
39 7-5-2 , as last amended by Laws of Utah 2010, Chapter 378
40 7-5-6 , as last amended by Laws of Utah 1982, Chapter 6
41 7-5-7 , as last amended by Laws of Utah 2010, Chapter 378
42 7-5-8 , as last amended by Laws of Utah 2010, Chapter 378
43 7-5-11 , as last amended by Laws of Utah 2010, Chapter 378
44 7-5-15 , as last amended by Laws of Utah 1994, Chapter 200
45 7-9-25 , as last amended by Laws of Utah 1983, Chapter 8
46 7-9-39.5 , as last amended by Laws of Utah 2003, Chapter 327
47 7-9-42 , as enacted by Laws of Utah 1981, Chapter 16
48 7-9-45 , as last amended by Laws of Utah 1999, Chapter 329
49 7-9-55 , as enacted by Laws of Utah 2003, Chapter 327
50 7-9-58 , as last amended by Laws of Utah 2008, Chapter 126
51 7-14-1 , as last amended by Laws of Utah 1995, Chapter 20
52 7-19-1 , as last amended by Laws of Utah 1995, Chapter 49
53 9-1-801 , as enacted by Laws of Utah 1994, Chapter 119
54 9-6-205 , as last amended by Laws of Utah 2012, Chapter 212
55 9-7-501 , as last amended by Laws of Utah 1993, Chapter 227
56 9-8-301 , as last amended by Laws of Utah 2005, Chapter 145
57 9-8-307 , as last amended by Laws of Utah 1995, Chapter 170
58 9-8-405 , as last amended by Laws of Utah 2008, Chapter 382
59 10-1-114 , as last amended by Laws of Utah 1999, Chapter 21
60 10-1-119 , as last amended by Laws of Utah 2013, Chapter 325
61 10-1-203 , as last amended by Laws of Utah 2012, Chapter 289
62 10-2-125 , as last amended by Laws of Utah 2012, Chapter 359
63 10-2-126 , as enacted by Laws of Utah 2012, Chapter 359
64 10-8-62 , as last amended by Laws of Utah 2001, Chapter 9
65 10-8-63 , as last amended by Laws of Utah 2001, Chapter 9
66 10-18-104 , as enacted by Laws of Utah 2001, Chapter 83
67 11-13-303 , as last amended by Laws of Utah 2008, Chapter 382
68 11-13-315 , as enacted by Laws of Utah 2013, Chapter 230
69 11-14-301 , as last amended by Laws of Utah 2012, Chapter 204
70 11-17-14 , as enacted by Laws of Utah 1967, Chapter 29
71 11-32-4 , as last amended by Laws of Utah 1995, Chapter 181
72 11-42-604 , as last amended by Laws of Utah 2009, Chapter 388
73 13-1a-5 , as last amended by Laws of Utah 2008, Chapter 382
74 13-22-8 , as last amended by Laws of Utah 2009, Chapter 183
75 13-23-5 , as last amended by Laws of Utah 2013, Chapter 124
76 13-26-4 , as last amended by Laws of Utah 1996, Chapter 170
77 13-32a-104 , as last amended by Laws of Utah 2012, Chapter 284
78 13-32a-115 , as enacted by Laws of Utah 2012, Chapter 284
79 13-32a-117 , as last amended by Laws of Utah 2013, Chapter 124
80 13-47-102 (Contingently Repealed), as enacted by Laws of Utah 2010, Chapter 403
81 13-47-201 (Contingently Repealed), as enacted by Laws of Utah 2010, Chapter 403
82 15-8-4 , as last amended by Laws of Utah 2007, Chapter 272
83 15-9-103 , as last amended by Laws of Utah 2010, Chapter 74
84 15-10-201 , as last amended by Laws of Utah 2011, Chapter 262
85 15A-1-204 , as enacted by Laws of Utah 2011, Chapter 14
86 15A-2-102 , as enacted by Laws of Utah 2011, Chapter 14
87 15A-2-104 , as last amended by Laws of Utah 2013, Chapter 297
88 15A-3-201 , as enacted by Laws of Utah 2011, Chapter 14
89 15A-3-306 , as last amended by Laws of Utah 2013, Chapter 297
90 15A-4-201 , as enacted by Laws of Utah 2011, Chapter 14
91 15A-5-103 , as last amended by Laws of Utah 2013, Chapter 199
92 16-6a-1011 , as enacted by Laws of Utah 2000, Chapter 300
93 16-6a-1202 , as enacted by Laws of Utah 2000, Chapter 300
94 16-6a-1701 , as enacted by Laws of Utah 2000, Chapter 300
95 16-6a-1702 , as last amended by Laws of Utah 2008, Chapter 250
96 16-10a-402 , as enacted by Laws of Utah 1992, Chapter 277
97 16-10a-901 , as enacted by Laws of Utah 1992, Chapter 277
98 16-10a-1106 , as enacted by Laws of Utah 1992, Chapter 277
99 16-10a-1301 , as enacted by Laws of Utah 1992, Chapter 277
100 16-10a-1405 , as enacted by Laws of Utah 1992, Chapter 277
101 16-16-113 , as last amended by Laws of Utah 2010, Chapter 378
102 17-18a-405 , as enacted by Laws of Utah 2013, Chapter 237
103 17-23-17.5 , as last amended by Laws of Utah 2001, Chapter 241
104 17-23-19 , as last amended by Laws of Utah 1993, Chapter 227
105 17-27a-205 , as last amended by Laws of Utah 2013, Chapter 324
106 17-27a-301 , as last amended by Laws of Utah 2011, Chapters 107 and 305
107 17-27a-512 , as last amended by Laws of Utah 2009, Chapters 170 and 233
108 17-36-3 , as last amended by Laws of Utah 2012, Chapter 17
109 17-36-39 , as last amended by Laws of Utah 2004, Chapter 206
110 17-53-301 , as last amended by Laws of Utah 2001, Chapter 241
111 17B-1-121 , as enacted by Laws of Utah 2011, Chapter 205
112 17B-1-512 , as last amended by Laws of Utah 2011, Chapter 297
113 17B-2a-902 , as last amended by Laws of Utah 2012, Chapter 97
114 17B-2a-905 , as last amended by Laws of Utah 2013, Chapter 70
115 17C-4-202 , as last amended by Laws of Utah 2010, Chapters 90 and 279
116 17D-3-105 , as enacted by Laws of Utah 2012, Chapter 103
117 20A-1-306 , as enacted by Laws of Utah 2011, Chapter 17
118 26-28-112 , as enacted by Laws of Utah 2007, Chapter 60
119 36-23-109 , as enacted by Laws of Utah 2013, Chapter 323
120 38-8-3.5 , as enacted by Laws of Utah 2013, Chapter 163
121 39-6-36 , as enacted by Laws of Utah 1988, Chapter 210
122 48-1d-1305 , as enacted by Laws of Utah 2013, Chapter 412
123 53-5-707 , as last amended by Laws of Utah 2013, Chapter 280
124 53-13-110 , as renumbered and amended by Laws of Utah 1998, Chapter 282
125 53A-1a-521 , as last amended by Laws of Utah 2013, Chapter 239
126 53A-3-701 , as last amended by Laws of Utah 2003, Chapter 221
127 53A-16-107 , as last amended by Laws of Utah 2011, Chapters 153, 369, and 371
128 53A-16-114 , as last amended by Laws of Utah 2011, Chapter 342 and renumbered and
129 amended by Laws of Utah 2011, Chapter 371
130 53A-17a-133 , as last amended by Laws of Utah 2013, Chapters 178 and 313
131 53A-25a-102 , as enacted by Laws of Utah 1994, Chapter 280
132 54-3-31 , as enacted by Laws of Utah 2013, Chapter 242
133 57-8-7.5 (Effective 07/01/14), as last amended by Laws of Utah 2013, Chapters 152,
134 419 and last amended by Coordination Clause, Laws of Utah 2013, Chapter 152
135 57-8-43, as last amended by Laws of Utah 2013, Chapter 152
136 57-8a-211 (Superseded 07/01/14), as last amended by Laws of Utah 2013, Chapter 419
137 58-40-302, as enacted by Laws of Utah 2012, Chapter 82
138 58-60-506, as last amended by Laws of Utah 2013, Chapter 123
139 58-77-601, as last amended by Laws of Utah 2008, Chapter 365
140 59-14-302, as last amended by Laws of Utah 2013, Chapter 148
141 63C-13-107, as enacted by Laws of Utah 2013, Chapter 228
142 63G-12-306, as enacted by Laws of Utah 2011, Chapter 18
143 63I-1-253, as last amended by Laws of Utah 2012, Chapter 369
144 63I-1-263, as last amended by Laws of Utah 2013, Chapters 28, 62, 101, 167, 250, and
146 63I-2-217, as last amended by Laws of Utah 2012, Chapter 17
147 63I-2-236, as last amended by Laws of Utah 2013, Chapter 283
148 63I-2-253, as lst amended by Laws of Utah 2013, Chapters 173 and 434
149 63I-2-277, as last amended by Laws of Utah 2012, Chapter 17
150 63I-4a-202, as renumbered and amended by Laws of Utah 2013, Chapter 325
151 63J-1-206, as last amended by Laws of Utah 2013, Chapter 310
152 63J-1-505, as renumbered and amended by Laws of Utah 2009, Chapter 183
153 63J-1-602.3, as last amended by Laws of Utah 2013, Chapters 117, 295 and last
154 amended by Coordination Clause, Laws of Utah 2013, Chapter 117
155 63J-1-602.4, as last amended by Laws of Utah 2013, Chapter 28
156 63M-1-3203, as enacted by Laws of Utah 2013, Chapter 336
157 70A-2a-533, as enacted by Laws of Utah 1990, Chapter 197
158 76-1-501, as last amended by Laws of Utah 2013, Chapter 278
159 76-5-102.4, as last amended by Laws of Utah 2013, Chapter 156
160 78A-2-301, as last amended by Laws of Utah 2012, Chapter 247
161 78A-7-301, as last amended by Laws of Utah 2011, Chapter 143
162 78B-3-421, as renumbered and amended by Laws of Utah 2008, Chapter 3
163 RENUMBERS AND AMENDS:
164 4-18-108 , (Renumbered from 4-18-6.5, as last amended by Laws of Utah 2008, Chapter
167 63G-13-203 , as enacted by Laws of Utah 2011, Chapter 19
169 Be it enacted by the Legislature of the state of Utah:
170 Section 1. Section 4-18-108 , which is renumbered from Section 4-18-6.5 is
171 renumbered and amended to read:
173 at animal feeding operations.
174 (1) (a) The commission may make grants to owners or operators of animal feeding
175 operations to pay for costs of plans or projects to improve manure management or control
176 surface water runoff, including costs of preparing or implementing comprehensive nutrient
177 management plans.
178 (b) The commission shall make the grants described in Subsection (1)(a) from funds
179 appropriated by the Legislature for that purpose.
180 (2) (a) In awarding grants, the commission shall consider the following criteria:
181 (i) the ability of the grantee to pay for costs of plans or projects to improve manure
182 management or control surface water runoff;
183 (ii) the availability of:
184 (A) matching funds provided by the grantee or another source; or
185 (B) material, labor, or other items of value provided in lieu of money by the grantee or
186 another source; and
187 (iii) the benefits that accrue to the general public by the awarding of a grant.
188 (b) The commission may establish by rule additional criteria for the awarding of grants.
189 (3) The commission shall make rules in accordance with Title 63G, Chapter 3, Utah
190 Administrative Rulemaking Act, to implement this section.
191 Section 2. Section 4-20-3 is amended to read:
192 4-20-3. Rangeland Improvement Account distribution.
193 (1) The department shall distribute restricted account money as provided in this
195 (a) The department shall:
196 (i) distribute pro rata to each school district the money received by the state under
197 Subsection 4-20-2 (1)(b)(i) from the sale or lease of public lands based upon the amount of
198 revenue generated from the sale or lease of public lands within the district; and
199 (ii) ensure that all money generated from the sale or lease of public lands within a
200 school district is credited and deposited to the general school fund of that school district.
201 (b) (i) After the commissioner approves a request from a regional board, the
202 department shall distribute pro rata to each regional board money received by the state under
203 Subsection 4-20-2 (1)(b)(i) from fees based upon the amount of revenue generated from the
204 imposition of fees within that grazing district.
205 (ii) The regional board shall expend money received in accordance with Subsection (2).
206 (c) (i) The department shall distribute or expend money received by the state under
207 Subsections 4-20-2 (1)(b)(ii) [
208 (ii) The department may require entities seeking funding from sources outlined in
209 Subsections 4-20-2 (1)(b)(ii) [
210 (2) The department shall ensure that restricted account distributions or expenditures
211 under Subsections (1)(b) and (c) are used for:
212 (a) range improvement and maintenance;
213 (b) the control of predatory and depredating animals;
214 (c) the control, management, or extermination of invading species, range damaging
215 organisms, and poisonous or noxious weeds;
216 (d) the purchase or lease of lands or a conservation easement for the benefit of a
217 grazing district;
218 (e) watershed protection, development, distribution, and improvement;
219 (f) the general welfare of livestock grazing within a grazing district; and
220 (g) subject to Subsection (3), costs to monitor rangeland improvement projects.
221 (3) Annual account distributions or expenditures for the monitoring costs described in
222 Subsection (2)(g) may not exceed 10% of the annual receipts of the fund.
223 Section 3. Section 4-32-11 is amended to read:
224 4-32-11. Preparation and slaughter of livestock, poultry, or livestock and poultry
225 products -- Adulterated or misbranded products -- Violation of rule or order.
226 (1) An animal or meat or poultry product that may be used for human consumption
227 shall not be:
228 (a) slaughtered or prepared unless it is done in compliance with this chapter's
230 (b) sold, transported, offered for sale or transportation, or received for transportation, if
231 it is adulterated or misbranded, unless it has been inspected and approved; or
232 (c) subjected to any act while being transported or held for sale after transportation
233 resulting in one of the products becoming adulterated or being misbranded.
234 (2) A person may not violate any rule or order of the commissioner under Subsection
235 4-32-7 (3) or (6), or Subsection 4-32-8 (3), (5), or (7)[
236 Section 4. Section 4-37-202 is amended to read:
237 4-37-202. Acquisition of aquatic animals for use in aquaculture facilities.
238 (1) Live aquatic animals intended for use in aquaculture facilities may be purchased or
239 acquired only from:
240 (a) aquaculture facilities within the state that have a certificate of registration and
241 health approval number;
242 (b) public aquaculture facilities within the state that have a health approval number; or
243 (c) sources outside the state that are health approved as provided in Part 5, Health
245 (2) A person holding a certificate of registration for an aquaculture facility shall submit
246 annually to the department a record of each purchase of live aquatic animals and transfer of live
247 aquatic animals into the facility. This record shall include the following information:
248 (a) name, address, and health approval number of the source;
249 (b) date of transaction; and
250 (c) number and weight by species.
251 (3) The records required by Subsection (2) shall be submitted to the department before
252 a certificate of registration is renewed or a subsequent certificate of registration is issued.
253 Section 5. Section 4-37-302 is amended to read:
254 4-37-302. Acquisition of aquatic animals for use in fee fishing facilities.
255 (1) Live aquatic animals intended for use in fee fishing facilities may be purchased or
256 acquired only from:
257 (a) aquaculture facilities within the state that have a certificate of registration and
258 health approval number;
259 (b) public aquaculture facilities within the state that have a health approval number; or
260 (c) sources outside the state that are health approved pursuant to Part 5, Health
262 (2) (a) A person holding a certificate of registration for a fee fishing facility shall
263 submit to the department an annual report of all live fish purchased or acquired.
264 (b) The report shall contain the following information:
265 (i) name, address, and certificate of registration number of the seller or supplier;
266 (ii) number and weight by species;
267 (iii) date of purchase or transfer; and
268 (iv) name, address, and certificate of registration number of the receiver.
269 (c) The report shall be submitted to the department before a certificate of registration is
270 renewed or subsequent certificate of registration is issued.
271 Section 6. Section 4-39-401 is amended to read:
272 4-39-401. Escape of domesticated elk -- Liability.
273 (1) It is the owner's responsibility to try to capture any domesticated elk that may have
275 (2) The escape of a domesticated elk shall be reported immediately to the state
276 veterinarian or a brand inspector of the Department of Agriculture who shall notify the
277 Division of Wildlife Resources.
278 (3) If the domesticated elk is not recovered within 72 hours of the escape, the
279 Department of Agriculture, in conjunction with the Division of Wildlife Resources, shall take
280 whatever action is necessary to resolve the problem.
281 (4) The owner shall reimburse the state or a state agency for any reasonable recapture
282 costs that may be incurred in the recapture or destruction of the animal.
283 (5) Any escaped domesticated elk taken by a licensed hunter in a manner which
284 complies with the provisions of Title 23, Wildlife Resources Code of Utah, and the rules of the
285 Wildlife Board shall be considered to be a legal taking and neither the licensed hunter, the
286 state, nor a state agency shall be liable to the owner for the killing.
287 (6) The owner shall be responsible to contain the domesticated elk to ensure that there
288 is no spread of disease from domesticated elk to wild elk and that the genetic purity of wild elk
289 is protected.
290 Section 7. Section 7-1-103 is amended to read:
291 7-1-103. Definitions.
292 As used in this title:
293 (1) (a) "Bank" means a person authorized under the laws of this state, another state, or
294 the United States to accept deposits from the public.
295 (b) "Bank" does not include:
296 (i) a federal savings and loan association or federal savings bank;
297 (ii) an industrial bank subject to Chapter 8, Industrial Banks;
298 (iii) a federally chartered credit union; or
299 (iv) a credit union subject to Chapter 9, Utah Credit Union Act.
300 (2) "Banking business" means the offering of deposit accounts to the public and the
301 conduct of such other business activities as may be authorized by this title.
302 (3) (a) "Branch" means a place of business of a financial institution, other than its main
303 office, at which deposits are received and paid.
304 (b) "Branch" does not include:
305 (i) an automated teller machine, as defined in Section 7-16a-102 ;
306 (ii) a point-of-sale terminal, as defined in Section 7-16a-102 ; or
307 (iii) a loan production office under Section 7-1-715 .
308 (4) "Commissioner" means the Commissioner of Financial Institutions.
309 (5) "Control" means the power, directly or indirectly, to:
310 (a) direct or exercise a controlling influence over:
311 (i) the management or policies of a financial institution; or
312 (ii) the election of a majority of the directors or trustees of an institution;
313 (b) vote 20% or more of any class of voting securities of a financial institution by an
314 individual; or
315 (c) vote more than 10% of any class of voting securities of a financial institution by a
316 person other than an individual.
317 (6) "Credit union" means a cooperative, nonprofit association incorporated under:
318 (a) Chapter 9, Utah Credit Union Act; or
319 (b) 12 U.S.C. Sec. 1751 et seq., Federal Credit Union Act, as amended.
320 (7) "Department" means the Department of Financial Institutions.
321 (8) "Depository institution" means a bank, savings and loan association, savings bank,
322 industrial bank, credit union, or other institution that:
323 (a) holds or receives deposits, savings, or share accounts;
324 (b) issues certificates of deposit; or
325 (c) provides to its customers other depository accounts that are subject to withdrawal
326 by checks, drafts, or other instruments or by electronic means to effect third party payments.
327 (9) (a) "Depository institution holding company" means:
328 (i) a person other than an individual that:
329 (A) has control over any depository institution; or
330 (B) becomes a holding company of a depository institution under Section 7-1-703 ; or
331 (ii) a person other than an individual that the commissioner finds, after considering the
332 specific circumstances, is exercising or is capable of exercising a controlling influence over a
333 depository institution by means other than those specifically described in this section.
334 (b) Except as provided in Section 7-1-703 , a person is not a depository institution
335 holding company solely because it owns or controls shares acquired in securing or collecting a
336 debt previously contracted in good faith.
337 (10) "Financial institution" means any institution subject to the jurisdiction of the
338 department because of this title.
339 (11) (a) "Financial institution holding company" means a person, other than an
340 individual that has control over any financial institution or any person that becomes a financial
341 institution holding company under this chapter, including an out-of-state or foreign depository
342 institution holding company.
343 (b) Ownership of a service corporation or service organization by a depository
344 institution does not make that institution a financial institution holding company.
345 (c) A person holding 10% or less of the voting securities of a financial institution is
346 rebuttably presumed not to have control of the institution.
347 (d) A trust company is not a holding company solely because it owns or holds 20% or
348 more of the voting securities of a financial institution in a fiduciary capacity, unless the trust
349 company exercises a controlling influence over the management or policies of the financial
351 (12) "Foreign depository institution" means a depository institution chartered or
352 authorized to transact business by a foreign government.
353 (13) "Foreign depository institution holding company" means the holding company of a
354 foreign depository institution.
355 (14) "Home state" means:
356 (a) for a state chartered depository institution, the state that charters the institution;
357 (b) for a federally chartered depository institution, the state where the institution's main
358 office is located; and
359 (c) for a depository institution holding company, the state in which the total deposits of
360 all depository institution subsidiaries are the largest.
361 (15) "Host state" means:
362 (a) for a depository institution, a state, other than the institution's home state, where the
363 institution maintains or seeks to establish a branch; and
364 (b) for a depository institution holding company, a state, other than the depository
365 institution holding company's home state, where the depository institution holding company
366 controls or seeks to control a depository institution subsidiary.
367 (16) "Industrial bank" means a corporation or limited liability company conducting the
368 business of an industrial bank under Chapter 8, Industrial Banks.
369 (17) "Industrial loan company" is as defined in Section 7-8-21 .
370 (18) "Insolvent" means the status of a financial institution that is unable to meet its
371 obligations as they mature.
372 (19) "Institution" means:
373 (a) a corporation;
374 (b) a limited liability company;
375 (c) a partnership;
376 (d) a trust;
377 (e) an association;
378 (f) a joint venture;
379 (g) a pool;
380 (h) a syndicate;
381 (i) an unincorporated organization; or
382 (j) any form of business entity.
383 (20) "Institution subject to the jurisdiction of the department" means an institution or
384 other person described in Section 7-1-501 .
385 (21) "Liquidation" means the act or process of winding up the affairs of an institution
386 subject to the jurisdiction of the department by realizing upon assets, paying liabilities, and
387 appropriating profit or loss, as provided in [
388 Depository Institution by Commissioner, and Chapter 19, Acquisition of Failing Depository
389 Institutions or Holding Companies.
390 (22) "Liquidator" means a person, agency, or instrumentality of this state or the United
391 States appointed to conduct a liquidation.
392 (23) (a) "Money services business" includes:
393 (i) a check casher;
394 (ii) a deferred deposit lender;
395 (iii) an issuer or seller of traveler's checks or money orders; and
396 (iv) a money transmitter.
397 (b) "Money services business" does not include:
398 (i) a bank;
399 (ii) a person registered with, and functionally regulated or examined by the Securities
400 Exchange Commission or the Commodity Futures Trading Commission, or a foreign financial
401 agency that engages in financial activities that, if conducted in the United States, would require
402 the foreign financial agency to be registered with the Securities Exchange Commission or the
403 Commodity Futures Trading Commission; or
404 (iii) an individual who engages in an activity described in Subsection (23)(a) on an
405 infrequent basis and not for gain or profit.
406 (24) "Negotiable order of withdrawal" means a draft drawn on a NOW account.
407 (25) (a) "NOW account" means a savings account from which the owner may make
408 withdrawals by negotiable or transferable instruments for the purpose of making transfers to
409 third parties.
410 (b) A "NOW account" is not a demand deposit.
411 (c) Neither the owner of a NOW account nor any third party holder of an instrument
412 requesting withdrawal from the account has a legal right to make withdrawal on demand.
413 (26) "Out-of-state" means, in reference to a depository institution or depository
414 institution holding company, an institution or company whose home state is not Utah.
415 (27) "Person" means:
416 (a) an individual;
417 (b) a corporation;
418 (c) a limited liability company;
419 (d) a partnership;
420 (e) a trust;
421 (f) an association;
422 (g) a joint venture;
423 (h) a pool;
424 (i) a syndicate;
425 (j) a sole proprietorship;
426 (k) an unincorporated organization; or
427 (l) any form of business entity.
428 (28) "Receiver" means a person, agency, or instrumentality of this state or the United
429 States appointed to administer and manage an institution subject to the jurisdiction of the
430 department in receivership, as provided in [
431 Depository Institution by Commissioner, and Chapter 19, Acquisition of Failing Depository
432 Institutions or Holding Companies.
433 (29) "Receivership" means the administration and management of the affairs of an
434 institution subject to the jurisdiction of the department to conserve, preserve, and properly
435 dispose of the assets, liabilities, and revenues of an institution in possession, as provided in
437 Chapter 19, Acquisition of Failing Depository Institutions or Holding Companies.
438 (30) "Savings account" means any deposit or other account at a depository institution
439 that is not a transaction account.
440 (31) "Savings and loan association" means:
441 (a) a federal savings and loan association; and
442 (b) an out-of-state savings and loan association.
443 (32) "Service corporation" or "service organization" means a corporation or other
444 business entity owned or controlled by one or more financial institutions that is engaged or
445 proposes to engage in business activities related to the business of financial institutions.
446 (33) "State" means, unless the context demands otherwise:
447 (a) a state;
448 (b) the District of Columbia; or
449 (c) the territories of the United States.
450 (34) "Subsidiary" means a business entity under the control of an institution.
451 (35) (a) "Transaction account" means a deposit, account, or other contractual
452 arrangement in which a depositor, account holder, or other customer is permitted, directly or
453 indirectly, to make withdrawals by:
454 (i) check or other negotiable or transferable instrument;
455 (ii) payment order of withdrawal;
456 (iii) telephone transfer;
457 (iv) other electronic means; or
458 (v) any other means or device for the purpose of making payments or transfers to third
460 (b) "Transaction account" includes:
461 (i) demand deposits;
462 (ii) NOW accounts;
463 (iii) savings deposits subject to automatic transfers; and
464 (iv) share draft accounts.
465 (36) "Trust company" means a person authorized to conduct a trust business, as
466 provided in Chapter 5, Trust Business.
467 (37) "Utah depository institution" means a depository institution whose home state is
469 (38) "Utah depository institution holding company" means a depository institution
470 holding company whose home state is Utah.
471 Section 8. Section 7-1-403 is amended to read:
472 7-1-403. Funds and balances paid to treasurer -- Separate account -- Use of
474 Unexpended balances and all funds accruing to the department shall be deposited by the
475 commissioner with the state treasurer monthly and constitute a separate account within the
476 General Fund. No part of the account may revert to the General Fund except an amount as
477 required by law to be transferred for general government and administrative costs. With the
478 approval of the director of the Division of Finance, the commissioner may withdraw sums from
479 the account to pay costs and expenses of administration incurred in proceedings under Title 7,
481 Institution by Commissioner, and Chapter 19, Acquisition of Failing Depository Institutions or
482 Holding Companies, or to use in connection with the rehabilitation, reorganization, or
483 liquidation of an institution under the jurisdiction of the department.
484 Section 9. Section 7-1-616 is amended to read:
485 7-1-616. Authority to accept transaction accounts -- Payment of instruments.
486 (1) A financial institution may accept or advertise that it accepts transaction accounts
487 only if authorized to do so under federal or state law. An institution may submit a written
488 request for this authority to the commissioner, except that an institution authorized to accept
489 transaction accounts as of June 1, 1994, does not, in the first instance, need to request or be
490 granted any additional authority. The commissioner shall grant the authority if the
491 commissioner finds that:
492 (a) the institution has adequate capital and reserves in relation to the character and
493 condition of its assets and its deposit and other liabilities;
494 (b) the deposits and other accounts held by the institution are insured or guaranteed by
495 an agency of the federal government; and
496 (c) the management of the institution is qualified to handle transaction accounts.
497 (2) The commissioner may revoke, limit, or condition an institution's authority to
498 accept and handle transaction accounts upon a finding that:
499 (a) the institution no longer meets the criteria set forth in Subsection (1); or
500 (b) it would be contrary to the public interest and the soundness of the financial system
501 of this state to allow the institution to continue to accept or handle transaction accounts without
502 limitation or condition.
503 (3) One or more depository institutions may, by written agreement, vary the terms of
504 Title 70A, [
505 and Chapter 4, Uniform Commercial Code - Bank Deposits and Collections, for the purposes
506 of facilitating the transfer, exchange, and prompt payment of instruments drawn on transaction
508 Section 10. Section 7-1-703 is amended to read:
509 7-1-703. Restrictions on acquisition of institutions and holding companies --
511 (1) Unless the commissioner gives prior written approval under Section 7-1-705 , no
512 person may:
513 (a) acquire, directly or indirectly, control of a depository institution or depository
514 institution holding company subject to the jurisdiction of the department;
515 (b) vote the stock of any depository institution or depository institution holding
516 company subject to the jurisdiction of the department acquired in violation of Section 7-1-705 ;
517 (c) acquire all or any portion of the assets of a depository institution or a depository
518 institution holding company subject to the jurisdiction of the department;
519 (d) assume all or any portion of the deposit liabilities of a depository institution subject
520 to the jurisdiction of the department;
521 (e) take any action that causes a depository institution to become a subsidiary of a
522 depository institution holding company subject to the jurisdiction of the department;
523 (f) take any action that causes a person other than an individual to become a depository
524 institution holding company subject to the jurisdiction of the department;
525 (g) acquire, directly or indirectly, the voting or nonvoting securities of a depository
526 institution or a depository institution holding company subject to the jurisdiction of the
527 department if the acquisition would result in the person obtaining more than 20% of the
528 authorized voting securities of the institution if the nonvoting securities were converted into
529 voting securities; or
530 (h) merge or consolidate with a depository institution or depository institution holding
531 company subject to the jurisdiction of the department.
532 (2) Any person who willfully violates any provision of this section or any rule or order
533 issued by the department under this section is subject to a civil penalty of not more than $1,000
534 per day during which the violation continues. The commissioner may assess the civil penalty
535 after giving notice and opportunity for hearing. The commissioner shall collect the civil
536 penalty by bringing an action in the district court of the county in which the office of the
537 commissioner is located. Any applicant for approval of an acquisition is considered to have
538 consented to the jurisdiction and venue of the court by filing an application for approval.
539 (3) The commissioner may secure injunctive relief to prevent any change in control or
540 impending violation of this section.
541 (4) The commissioner may lengthen or shorten any time period specified in Section
542 7-1-705 if the commissioner finds it necessary to protect the public interest.
543 (5) The commissioner may exempt any class of financial institutions from this section
544 by rule if the commissioner finds the exception to be in the public interest.
545 (6) The prior approval of the commissioner under Section 7-1-705 is not required for
546 the acquisition by a person other than an individual of voting securities or assets of a depository
547 institution or a depository institution holding company that are acquired by foreclosure or
548 otherwise in the ordinary course of collecting a debt previously contracted in good faith if these
549 voting securities or assets are divested within two years of acquisition. The commissioner may,
550 upon application, extend the two-year period of divestiture for up to three additional one-year
551 periods if, in the commissioner's judgment, the extension would not be detrimental to the
552 public interest. The commissioner may adopt rules to implement the intent of this Subsection
554 (7) (a) An out-of-state depository institution without a branch in Utah, or an
555 out-of-state depository institution holding company without a depository institution in Utah,
556 may acquire:
557 (i) a Utah depository institution only if it has been in existence for at least five years; or
558 (ii) a Utah branch of a depository institution only if the branch has been in existence
559 for at least five years.
560 (b) For purposes of Subsection (7)(a), a depository institution chartered solely for the
561 purpose of acquiring another depository institution is considered to have been in existence for
562 the same period as the depository institution to be acquired, so long as it does not open for
563 business at any time before the acquisition.
564 (c) The commissioner may waive the restriction in Subsection (7)(a) in the case of a
565 depository institution that is subject to, or is in danger of becoming subject to, supervisory
566 action under Chapter 2, Possession of Depository Institution by Commissioner, or Chapter 19,
567 Acquisitions of Failing Repository Institutions or Holding Companies, or, if applicable, the
568 equivalent provisions of federal law or the law of the institution's home state.
569 (d) The restriction in Subsection (7)(a) does not apply to an acquisition of, or merger
570 transaction between, affiliate depository institutions.
571 Section 11. Section 7-1-710 is amended to read:
572 7-1-710. "Agency" defined -- Purposes and establishment of agency.
573 (1) As used in this section, "agency" means a place, person, or facility, stationary or
574 mobile, other than the home office or a branch office[
575 (a) where functions of the financial institution not involving the receiving or paying of
576 deposits, making of loans or the handling of cash may be performed[
577 (b) established for individual transactions and for special temporary purposes[
578 (c) established for the purposes set forth in Sections 7-1-608 and 7-1-609 [
579 (d) established to perform the functions of a financial institution service corporation.
580 (2) A financial institution may establish one or more agencies without the prior written
581 approval of the commissioner. Within 30 days of the establishment of an agency, the financial
582 institution shall inform the commissioner in writing of the address of the agency and the
583 specific functions for which it was established.
584 (3) No agency may be converted to a branch without compliance with Section 7-1-708 .
585 Section 12. Section 7-1-802 is amended to read:
586 7-1-802. Confidentiality of information received by department -- Availability of
588 (1) The commissioner shall receive and place on file in the department's office all
589 reports required by law and shall certify all reports required to be published.
590 (2) Except as provided in this section, the following are confidential, not public
591 records, and not open to public inspection:
592 (a) all reports received or prepared by the department;
593 (b) all information obtained from an institution or person under the jurisdiction of the
594 department; and
595 (c) all orders and related records of the department.
596 (3) The following records and information are public and are open to public inspection:
597 (a) reports of condition required by Section 7-1-318 ;
598 (b) information that is otherwise generally available to the public; and
599 (c) information contained in, and final decisions on, an application filed under Sections
600 7-1-702 , 7-1-703 , 7-1-704 , 7-1-705 , 7-1-706 , 7-1-708 , 7-1-709 , 7-1-712 , 7-1-713 , or Chapter
601 19, Acquisitions of Failing Repository Institutions or Holding Companies, excluding:
602 (i) proprietary information, business plans, and personal financial information; and
603 (ii) information for which:
604 (A) the applicant requests confidentiality; and
605 (B) the commissioner grants the request for confidentiality.
606 (4) The department may disclose records and information that are not public to the
608 (a) to an agency or authority:
609 (i) that regulates:
610 (A) the subject of the record; or
611 (B) an affiliate of the subject of the record, as defined by the commissioner by rule; and
612 (ii) is of:
613 (A) the federal government;
614 (B) the state; or
615 (C) another state;
616 (b) to a federal deposit insurance agency;
617 (c) to an official legally authorized to investigate criminal charges in connection with
618 the affairs of the subject of the record, and to any tribunal conducting legal proceedings
619 resulting from such an investigation;
620 (d) to a person preparing a proposal for merging or acquiring an institution under
622 19, Acquisition of Failing Repository Institutions or Holding Companies, but only after the
623 department provides notice of the disclosure to the institution;
624 (e) to any other person, if the commissioner determines, after notice to the institution
625 or person that is the subject of the record and opportunity for hearing, that the interests favoring
626 disclosure of the information outweigh the interests favoring confidentiality of the information;
628 (f) to any court in a proceeding under:
629 (i) Sections 7-1-304 , 7-1-320 , 7-1-322 ; or
630 (ii) a supervisory action under [
631 Institution by Commissioner, or Chapter 19, Acquisition of Failing Repository Institutions or
632 Holding Companies.
633 (5) The commissioner may limit the use and further disclosure of any information
634 disclosed under Subsection (4):
635 (a) to protect the business confidentiality interest of the subject of the record; and
636 (b) to protect the public interest, such as to avoid:
637 (i) a liquidity crisis in a depository institution; or
638 (ii) undue speculation in securities or currency markets.
639 (6) The department shall disclose information in the manner and to the extent directed
640 by a court order signed by a judge from a court of competent jurisdiction if:
641 (a) the disclosure does not violate applicable federal or state law;
642 (b) the information to be disclosed deals with a matter in controversy over which the
643 court has jurisdiction;
644 (c) the person requesting the order has provided reasonable prior written notice to the
646 (d) the court has considered the merits of the request for disclosure and has determined
647 that the interests favoring disclosure of the information outweigh the interests favoring
648 confidentiality of the information; and
649 (e) the court has appropriately limited the use and further disclosure of the information:
650 (i) to protect the business confidentiality interest of the subject of the record; and
651 (ii) to protect the public interest, such as to avoid:
652 (A) a liquidity crisis in a depository institution; or
653 (B) undue speculation in securities or currency markets.
654 Section 13. Section 7-2-1 is amended to read:
655 7-2-1. Supervisory actions by commissioner -- Grounds -- Mergers or acquisitions
656 authorized by commissioner -- Possession of business and property taken by
658 (1) An institution under the jurisdiction of the department is subject to supervisory
659 actions by the commissioner under this chapter or Chapter 19, Acquisition of Failing
660 Repository Institutions or Holding Companies, if the commissioner, with or without an
661 administrative hearing, finds that:
662 (a) the institution is not in a safe and sound condition to transact its business;
663 (b) an officer of the institution or other person has refused to be examined or has made
664 false statements under oath regarding its affairs;
665 (c) the institution or other person has violated its articles of incorporation or any law,
666 rule, or regulation governing the institution or other person;
667 (d) the institution or other person is conducting its business in an unauthorized or
668 unsafe manner, or is practicing deception upon its depositors, members, or the public, or is
669 engaging in conduct injurious to its depositors, members, or the public;
670 (e) the institution or other person has been notified by its primary account insurer of the
671 insurer's intention to initiate proceedings to terminate insurance;
672 (f) the institution or other person has failed to maintain a minimum amount of capital
673 as required by the department, any state, or the relevant federal regulatory agency;
674 (g) the institution or other person is a depository institution that has failed or refused to
675 pay its depositors in accordance with the terms under which the deposits were received, or has
676 or is about to become insolvent;
677 (h) the institution or other person or its officers or directors have failed or refused to
678 comply with the terms of a legally authorized order issued by the commissioner or by any
679 federal authority or authority of another state having jurisdiction over the institution or other
681 (i) the institution or other person or its officers or directors have failed or refused, upon
682 proper demand, to submit its records, books, papers, and affairs for inspection to the
683 commissioner or to a supervisor or an examiner of the department;
684 (j) the institution or other person or its officers or directors, after 30 days written
685 notice, have failed to comply with or have continued to violate this title or any rule or
686 regulation of the department issued under it;
687 (k) any person who controls the institution or other person subject to the jurisdiction of
688 the department has used the control to cause the institution or other person to be or about to be
689 in an unsafe or unsound condition, to conduct its business in an unauthorized or unsafe manner,
690 or to violate this title or any rule or regulation of the department issued under it; or
691 (l) the remedies provided in Section 7-1-307 , 7-1-308 , or 7-1-313 are ineffective or
692 impracticable to protect the interest of depositors, creditors, or members of the institution or
693 other person, or to protect the interests of the public.
694 (2) The commissioner may take any action described in Subsection (3) if:
695 (a) he finds that:
696 (i) any of the conditions set forth in Subsection (1) exist with respect to an institution
697 under the jurisdiction of the department; and
698 (ii) an order issued pursuant to Section 7-1-307 , 7-1-308 , or 7-1-313 would not
699 adequately protect the interests of the institution's depositors, creditors, members, or other
700 interested persons from all dangers presented by the conditions found to exist; or
701 (b) two-thirds of the voting shares of an institution under the jurisdiction of the
702 department that are eligible to be voted at any regular or special meeting of the shareholders of
703 the institution are voted at the meeting in favor of a resolution consenting to the commissioner
704 taking or causing to be taken any of the actions described below.
705 (3) After making the requisite findings or receiving the consenting vote of shareholders
706 under Subsection (2), the commissioner may:
707 (a) without taking possession of the institution, authorize, or by order require or give
708 effect to the acquisition of control of, the merger with, the acquisition of all or a portion of the
709 assets of, or the assumption of all or a portion of the liabilities of the institution or other person
710 by any other institution or entity approved or designated by the commissioner in accordance
711 with Chapter 19, Acquisition of Failing Repository Institutions or Holding Companies; or
712 (b) take possession of the institution or other person subject to the jurisdiction of the
713 department with or without a court order if an acquisition of control of, a merger with, an
714 acquisition of all or a portion of the assets of, or an assumption of all or a portion of the
715 liabilities of the institution or other person without taking possession does not appear to the
716 commissioner to be practicable.
717 (4) Upon taking possession of an institution or the person, the commissioner is vested
718 by operation of law with the title to and the right to possession of all assets, the business, and
719 property of the institution or other person subject to court order made under Section 7-2-3 .
720 While in possession of an institution or other person, the commissioner or any receiver or
721 liquidator appointed by him may exercise any or all of the rights, powers, and authorities
722 granted to the commissioner under this chapter, or may give effect to the acquisition of control
723 of, the merger with, the acquisition of all or a portion of the assets of, or the assumption of all
724 or a portion of the liabilities of an institution or other person subject to the jurisdiction of the
725 department, under the provisions of Chapter 19, Acquisition of Failing Repository Institutions
726 or Holding Companies.
727 (5) An action of the commissioner under this section may only be enjoined or set aside
728 upon a finding, after notice and hearing, that the action is arbitrary, capricious, an abuse of
729 discretion, or otherwise contrary to law.
730 Section 14. Section 7-2-2 is amended to read:
731 7-2-2. Jurisdiction of district court -- Supervision of actions of commissioner in
732 possession -- Authority of commissioner and court.
733 (1) The district court for the county in which the principal office of the institution or
734 other person is situated has jurisdiction in the liquidation or reorganization of the institution or
735 other person of which the commissioner has taken possession under this chapter or Chapter 19,
736 Acquisition of Failing Repository Institutions or Holding Companies. As used in this chapter,
737 "court" means the court given jurisdiction by this provision.
738 (2) Before taking possession of an institution or other person under his jurisdiction, or
739 within a reasonable time after taking possession of an institution or other person without court
740 order, as provided in this chapter, the commissioner shall cause to be commenced in the
741 appropriate district court, an action to provide the court supervisory jurisdiction to review the
742 actions of the commissioner.
743 (3) The actions of the commissioner are subject to review of the court. The court has
744 jurisdiction to hear all objections to the actions of the commissioner and may rule upon all
745 motions and actions coming before it. Standing to seek review of any action of the
746 commissioner or any receiver or liquidator appointed by him is limited to persons whose rights,
747 claims, or interests in the institution would be adversely affected by the action.
748 (4) The authority of the commissioner under this chapter is of an administrative and
749 not judicial receivership. The court may not overrule a determination or decision of the
750 commissioner if it is not arbitrary, capricious, fraudulent, or contrary to law. If the court
751 overrules an action of the commissioner, the matter shall be remanded to the commissioner for
752 a new determination by him, and the new determination shall be subject to court review.
753 Section 15. Section 7-2-12 is amended to read:
754 7-2-12. Powers of commissioner in possession -- Sale of assets -- Postpossession
755 financing -- New deposit instruments -- Executory contracts -- Transfer of property --
756 Avoidance of transfers -- Avoidable preferences -- Setoff.
757 (1) Upon taking possession of the institution, the commissioner may do all things
758 necessary to preserve its assets and business, and shall rehabilitate, reorganize, or liquidate the
759 affairs of the institution in a manner he determines to be in the best interests of the institution's
760 depositors and creditors. Any such determination by the commissioner may not be overruled
761 by a reviewing court unless it is found to be arbitrary, capricious, fraudulent, or contrary to law.
762 In the event of a liquidation, he shall collect all debts due and claims belonging to it, and may
763 compromise all bad or doubtful debts. He may sell, upon terms he may determine, any or all of
764 the property of the institution for cash or other consideration. The commissioner shall give
765 such notice as the court may direct to the institution of the time and place of hearing upon an
766 application to the court for approval of the sale. The commissioner shall execute and deliver to
767 the purchaser of any property of the institution sold by him those deeds or instruments
768 necessary to evidence the passing of title.
769 (2) With approval of the court and upon terms and with priority determined by the
770 court, the commissioner may borrow money and issue evidence of indebtedness. To secure
771 repayment of the indebtedness, he may mortgage, pledge, transfer in trust, or hypothecate any
772 or all of the property of the institution superior to any charge on the property for expenses of
773 the proceeding as provided in Section 7-2-14 . These loans may be obtained for the purpose of
774 facilitating liquidation, protecting or preserving the assets in the charge of the commissioner,
775 expediting the making of distributions to depositors and other claimants, aiding in the
776 reopening or reorganization of the institution or its merger or consolidation with another
777 institution, or the sale of all of its assets. Neither the commissioner nor any special deputy or
778 other person lawfully in charge of the affairs of the institution is under any personal obligation
779 to repay those loans. The commissioner may take any action necessary or proper to
780 consummate the loan and to provide for its repayment and to give bond when required for the
781 faithful performance of all undertakings in connection with it. The commissioner or special
782 deputy shall make application to the court for approval of any loan proposed under this section.
783 Notice of hearing upon the application shall be given as the court directs. At the hearing upon
784 the application any stockholder or shareholder of the institution or any depositor or other
785 creditor of the institution may appear and be heard on the application. Prior to the obtaining of
786 a court order, the commissioner or special deputy in charge of the affairs of the institution may
787 make application or negotiate for the loan or loans subject to the obtaining of the court order.
788 (3) With the approval of the court pursuant to a plan of reorganization or liquidation
789 under Section 7-2-18 , the commissioner may provide for depositors to receive new deposit
790 instruments from a depository institution that purchases or receives some or all of the assets of
791 the institution in the possession of the commissioner. All new deposit instruments issued by
792 the acquiring depository institution may, in accordance with the terms of the plan of
793 reorganization or liquidation, be subject to different amounts, terms, and interest rates than the
794 original deposit instruments of the institution in the possession of the commissioner. All
795 deposit instruments issued by the acquiring institution shall be considered new deposit
796 obligations of the acquiring institution. The original deposit instruments issued by the
797 institution in the possession of the commissioner are not liabilities of the acquiring institution,
798 unless assumed by the acquiring institution. Unpaid claims of depositors against the institution
799 in the possession of the commissioner continue, and may be provided for in the plan of
800 reorganization or liquidation.
801 (4) The commissioner, after taking possession of any institution or other person subject
802 to the jurisdiction of the department, may terminate any executory contract, including standby
803 letters of credit, unexpired leases and unexpired employment contracts, to which the institution
804 or other person is a party. If the termination of an executory contract or unexpired lease
805 constitutes a breach of the contract or lease, the date of the breach is the date on which the
806 commissioner took possession of the institution. Claims for damages for breach of an
807 executory contract shall be filed within 30 days of receipt of notice of the termination, and if
808 allowed, shall be paid in the same manner as all other allowable claims of the same priority out
809 of the assets of the institution available to pay claims.
810 (5) With approval of the court and upon a showing by the commissioner that it is in the
811 best interests of the depositors and creditors, the commissioner may transfer property on
812 account of an indebtedness incurred by the institution prior to the date of the taking.
813 (6) (a) The commissioner may avoid any transfer of any interest of the institution in
814 property or any obligation incurred by the institution that is void or voidable by a creditor under
815 Title 25, Chapter 6, Uniform Fraudulent Transfer Act.
816 (b) The commissioner may avoid any transfer of any interest in real property of the
817 institution that is void as against or voidable by a subsequent purchaser in good faith and for a
818 valuable consideration of the same real property or any portion thereof who has duly recorded
819 his conveyance at the time possession of the institution is taken, whether or not such a
820 purchaser exists.
821 (c) The commissioner may avoid any transfer of any interest in property of the
822 institution or any obligation incurred by the institution that is invalid or void as against, or is
823 voidable by a creditor that extends credit to the institution at the time possession of the
824 institution is taken by the commissioner, and that obtains, at such time and with respect to such
825 credit, a judgment lien or a lien by attachment, levy, execution, garnishment, or other judicial
826 lien on the property involved, whether or not such a creditor exists.
827 (d) The right of the commissioner under Subsections (6)(b) and (c) to avoid any
828 transfer of any interest in property of the institution shall be unaffected by and without regard
829 to any knowledge of the commissioner or of any creditor of the institution.
830 (e) "Transfer" means every mode, direct or indirect, absolute or conditional, voluntary
831 or involuntary, or disposing of or parting with property or with an interest in property,
832 including retention of title as a security interest.
833 (f) The commissioner may avoid and recover any payment or other transfer of any
834 interest in property of the institution to or for the benefit of a creditor, for or on account of an
835 antecedent debt owed by the institution before the transfer was made if the creditor at the time
836 of such transfer had reasonable cause to believe that the institution was insolvent, and if the
837 payment or other transfer will allow the creditor to obtain a greater percentage of his debt than
838 he would be entitled to under the provisions of Section 7-2-15 . For the purposes of this
840 (i) antecedent debt does not include earned wages and salaries and other operating
841 expenses incurred and paid in the normal course of business;
842 (ii) a transfer of any interest in real property is deemed to have been made or suffered
843 when it became so far perfected that a subsequent good faith purchaser of the property from the
844 institution for a valuable consideration could not acquire an interest superior to the transferee;
846 (iii) a transfer of property other than real property is deemed to have been made or
847 suffered when it became so far perfected that a creditor on a simple contract could not acquire a
848 lien by attachment, levy, execution, garnishment, or other judicial lien superior to the interest
849 of the transferee.
850 (g) For purposes of this section, "date of possession" means the earlier of the date the
851 commissioner takes possession of a financial institution under Title 7, Chapter 2, Possession of
852 Depository Institution by Commissioner, or the date when the commissioner enters an order
853 suspending payments to depositors and other creditors under Section 7-2-19 .
854 (7) (a) With or without the prior approval of the court, the commissioner or any federal
855 deposit insurance agency appointed by him as receiver or liquidator of a depository institution
856 closed by the commissioner under the provisions of this chapter may setoff against the deposits
857 or other liabilities of the institution any debts or other obligations of the depositor or claimant
858 due and owing to the institution. The amount of any setoff against the liabilities of the
859 institution shall be no greater than the amount the depositor or claimant would receive pursuant
860 to Section 7-2-15 after final liquidation of the institution. When the liquidation value of a
861 depositor's or claimant's claim against the institution will or may be less than the full amount of
862 the claim, setoff may be made prior to final liquidation if the commissioner or any receiver or
863 liquidator appointed by him can reasonably estimate the liquidation value of the claim, and the
864 court, after notice and opportunity for hearing, approves the estimate for purposes of making
865 the setoff. If the right of setoff is exercised, the commissioner or any receiver or liquidator
866 appointed by him shall give written notice to the depositor or claimant of the amount setoff.
867 (b) The existence and amount of a debtor or creditor relationship or both, between the
868 institution and its depositor or claimant and the right to the proceeds in a deposit account shall
869 be determined solely by the books and records of the institution.
870 (c) Any contract purporting to affect the right of setoff shall be in writing and signed by
871 the depositor-debtor and an authorized officer of the institution and be maintained as a part of
872 the records of the institution.
873 (d) Any claim that a deposit account is a special account not subject to setoff because it
874 was maintained for a specific purpose or to satisfy a particular obligation other than satisfaction
875 of or as security for an indebtedness to the institution or that the right to the deposit actually
876 belongs to a third party does not affect the right to setoff of the commissioner or any receiver or
877 liquidator appointed by him unless the special nature of the account is clearly shown in the
878 books and records of the institution.
879 (e) In the absence of any other instrument in writing, the terms and provisions of the
880 signature card applicable to a particular account in effect at the time the commissioner takes
881 possession of the institution shall be determinative of the right of setoff by the commissioner or
882 any receiver or liquidator appointed by him.
883 (f) Knowledge of the institution or of any director, officer, or employee of the
884 institution that the nature of the account is other than as shown in the books and records of the
885 institution does not affect the right of setoff by the commissioner or any receiver or liquidator
886 appointed by him.
887 (g) The liability of the commissioner or any receiver or liquidator appointed by him for
888 exercising a right of setoff other than as authorized by this section shall be only to a person
889 who establishes by the procedure set forth in Section 7-2-6 that his interest in the account is
890 superior to that of the person whose debt to the institution was setoff against the account. The
891 amount of any such liability shall be no greater than the amount of the setoff and neither the
892 commissioner or any receiver or liquidator appointed by him shall be liable for any action taken
893 under this section unless the action taken is determined by the court to be arbitrary or
895 Section 16. Section 7-3-1 is amended to read:
896 7-3-1. Application of chapter.
897 This chapter applies to all banks organized under the laws of this state, to all other
898 banks doing business in this state as permitted by the laws and Constitution of the United
899 States, and to all persons conducting banking business in this state except as provided in
900 Chapter 1, General Provisions.
901 Section 17. Section 7-5-2 is amended to read:
902 7-5-2. Permit required to engage in trust business -- Exceptions.
903 (1) No trust company shall accept any appointment to act in any agency or fiduciary
904 capacity, including that of personal representative, executor, administrator, conservator,
905 guardian, assignee, receiver, depositary, or trustee under order or judgment of any court or by
906 authority of any law of this state or as trustee for any purpose permitted by law or otherwise
907 engage in the trust business in this state, unless and until it has obtained from the commissioner
908 a permit to act under this chapter. This provision does not apply to any bank or other
909 corporation authorized to engage and lawfully engaged in the trust business in this state before
910 July 1, 1981.
911 (2) Nothing in this chapter prohibits:
912 (a) any corporation organized under Title 16, Chapter 6a [
913 Nonprofit Corporation Act, or Chapter 10a, Utah Revised Business Corporation Act, from
914 acting as trustee of any employee benefit trust established for the employees of the corporation
915 or the employees of one or more other corporations affiliated with the corporation;
916 (b) any corporation organized under Title 16, Chapter 6a, Utah Revised Nonprofit
917 Corporation Act, and owned or controlled by a charitable, benevolent, eleemosynary, or
918 religious organization from acting as a trustee for that organization or members of that
919 organization but not offering trust services to the general public;
920 (c) any corporation organized under Title 16, Chapter 6a [
921 Nonprofit Corporation Act, or Chapter 10a, Utah Revised Business Corporation Act, from
922 holding in a fiduciary capacity the controlling shares of another corporation but not offering
923 trust services to the general public; or
924 (d) any depository institution from holding in an agency or fiduciary capacity
925 individual retirement accounts or Keogh plan accounts established under Section 401(a) or
926 408(a) of Title 26 of the United States Code.
927 Section 18. Section 7-5-6 is amended to read:
928 7-5-6. Confidentiality of communications and writings concerning trust -- Actions
929 to protect property or authorized under probate laws not precluded.
930 Any trust company exercising the powers and performing the duties described in this
931 chapter shall keep inviolate all communications and writings made to or by that trust company
932 relating to the existence, condition, management or administration of any agency or fiduciary
933 account confided to it and no creditor or stockholder of any such trust company shall be
934 entitled to disclosure or knowledge of any such communication or writing, except that the
935 directors, president, vice president, manager, treasurer, and trust officers, and any employees
936 assigned to work on the trust business, and the attorney or auditor employed by it shall be
937 entitled to knowledge of any such communication or writing and except that in any suit or
938 proceeding relating to the existence, condition, management or administration of the account,
939 the court in which the suit is pending may require disclosure of any such communication or
940 writing. A trust company is not, however, precluded from filing an action in court to protect
941 trust account property or as authorized under Title 75, Utah Uniform Probate Code.
942 Section 19. Section 7-5-7 is amended to read:
943 7-5-7. Management and investment of trust funds.
944 (1) Funds received or held by any trust company as agent or fiduciary, whether for
945 investment or distribution, shall be invested or distributed as soon as practicable as authorized
946 under the instrument creating the account and may not be held uninvested any longer than is
947 reasonably necessary.
948 (2) If the instrument creating an agency or fiduciary account contains provisions
949 authorizing the trust company, its officers, or its directors to exercise their discretion in the
950 matter of investments, funds held in the trust account under that instrument may be invested
951 only in those classes of securities which are approved by the directors of the trust company or a
952 committee of directors appointed for that purpose. If a trust company acts in any agency or
953 fiduciary capacity under appointment by a court of competent jurisdiction, it shall make and
954 account for all investments according to the provisions of Title 75, Utah Uniform Probate
955 Code, unless the underlying instrument provides otherwise.
956 (3) (a) Funds received or held as agent or fiduciary by any trust company which is also
957 a depository institution, whether for investment or distribution, may be deposited in the
958 commercial department or savings department of that trust company to the credit of its trust
959 department. Whenever the funds so deposited in a fiduciary or managing agency account
960 exceed the amount of federal deposit insurance applicable to that account, the trust company
961 shall deliver to the trust department or put under its control collateral security as outlined in
962 Regulation 9.10 of the Comptroller of the Currency or in Regulation 550.8 of the Office of
963 Thrift Supervision, as amended. However, if the instrument creating such a fiduciary or
964 managing agency account expressly provides that funds may be deposited to the commercial or
965 savings department of the trust company, then the funds may be so deposited without setting
966 aside collateral securities as required under this section and the deposits in the event of
967 insolvency of any such trust company shall be treated as other general deposits are treated. A
968 trust company which deposits trust funds in its commercial or savings department shall be
969 liable for interest on the deposits only at the rates, if any, paid by the trust company on deposits
970 of like kind not made to the credit of its trust department.
971 (b) Funds received or held as agent or fiduciary by a trust company, whether for
972 investment or distribution, may be deposited in an affiliated depository institution. Whenever
973 the funds so deposited in a fiduciary or managing agency account exceed the amount of federal
974 deposit insurance applicable to that account, the depository institution shall deliver to the trust
975 company or put under its control collateral security as outlined in Regulation 9.10 of the
976 Comptroller of the Currency or in Regulation 550.8 of the Office of Thrift Supervision as
977 amended. However, if the instrument creating the fiduciary or managing agency account
978 expressly permits funds to be deposited in the affiliated depository institution, the funds may be
979 so deposited without setting aside collateral securities as required under this section and
980 deposits in the event of insolvency of the depository institution shall be treated as other general
981 deposits are treated. A trust company which deposits trust funds in an affiliated depository
982 institution is liable for interest on the deposits only at the rates, if any, paid by the depository
983 institution on deposits of like kind.
984 (4) In carrying out all aspects of its trust business, a trust company shall have all the
985 powers, privileges, and duties as set forth in Sections 75-7-813 and 75-7-814 with respect to
986 trustees, whether or not the trust company is acting as a trustee as defined in Title 75, Utah
987 Uniform Probate Code.
988 (5) Nothing in this section may alter, amend, or limit the powers of a trust company
989 acting in a fiduciary capacity as specified in the particular instrument or order creating the
990 fiduciary relationship.
991 Section 20. Section 7-5-8 is amended to read:
992 7-5-8. Segregation of trust assets -- Books and records required -- Examination --
993 Trust property not subject to claims or debts against trust company.
994 A trust company exercising the powers to act as an agent or fiduciary under this chapter
995 shall segregate all assets held in any agency or fiduciary capacity from the general assets of the
996 company and shall keep a separate set of books and records showing in proper detail all
997 transactions engaged in under authority of this chapter. These books and records shall be open
998 to inspection by the commissioner and shall be examined by him or by examiners appointed by
999 him as provided in Chapter 1, General Provisions, or examined by other appropriate regulating
1000 agencies or both. Property held in an agency or fiduciary capacity by a trust company is not
1001 subject to claims or debts against the trust company.
1002 Section 21. Section 7-5-11 is amended to read:
1003 7-5-11. Self-dealing with trust property -- Own stock as trust property -- Policies
1004 for dealing with trust securities.
1005 (1) Except as provided in Section 7-5-7 , in Title 75, Utah Uniform Probate Code, or as
1006 authorized under the instrument creating the relationship, a trust company may not invest funds
1007 held as an agent or fiduciary in stock or obligations of, or with such funds acquire property
1008 from, the trust company or any of its directors, officers or employees, nor shall a trust company
1009 sell property held as an agent or fiduciary to the company or to any of its directors, officers, or
1011 (2) A trust company may retain and vote stock of the trust company or of any of its
1012 affiliates received by it as assets of any trust account or in any other fiduciary relationship of
1013 which it is appointed agent or fiduciary, unless the instrument creating the relationship
1014 otherwise provides.
1015 (3) Every trust company shall adopt written policies and procedures regarding
1016 decisions or recommendations to purchase or sell any security to facilitate compliance with
1017 federal and state securities laws. These policies and procedures, in particular, shall prohibit the
1018 trust company from using material inside information in connection with any decision or
1019 recommendation to purchase or sell any security.
1020 Section 22. Section 7-5-15 is amended to read:
1021 7-5-15. Assets of trust company in possession of the commissioner.
1022 With respect to a trust company in the possession of the commissioner under Chapter 2,
1023 Possession of Depository Institution by Commissioner, notwithstanding any law to the
1024 contrary, the assets held by the trust company in a fiduciary capacity as a part of its trust
1025 business, as defined in Section 7-5-1 , are not subject to the claims of any secured or unsecured
1026 creditor of the trust company.
1027 Section 23. Section 7-9-25 is amended to read:
1028 7-9-25. Shares -- Number unlimited -- Subscription and payment -- Par value --
1029 Ownership required for membership -- Dormant accounts.
1030 (1) The capital of the credit union shall be unlimited in amount.
1031 (2) Shares of the credit union may be subscribed and paid for in cash or its equivalent
1032 in a manner prescribed in the bylaws.
1033 (3) The par value of each share of a credit union shall be determined by the board of
1034 directors in multiples of $5 as prescribed in the bylaws.
1035 (4) Each member of the credit union shall subscribe to at least one share and pay the
1036 initial installment thereon. The par value of the share shall be paid for within six months.
1037 (5) The board of directors may close a member's account when the share par value is
1038 not paid within the required period or the par value is not maintained. Notice in writing shall be
1039 mailed to the member at the last known address and shall contain a statement that the member
1040 may increase payment or voluntarily close the account within 60 days of receipt of the notice.
1041 (6) When a member's account becomes dormant or is reasonably presumed to be
1042 dormant and abandoned, as provided in Chapter 1, General Provisions, the credit union by
1043 resolution of the board of directors may close the account and transfer the credits of the account
1044 to an account for unclaimed shares. Thereafter the credit union may not pay dividends or
1045 interest on the account, as provided in the bylaws, until the funds in the account escheat to the
1046 state of Utah. Prior to transferring the member's dormant and abandoned account to the credit
1047 union unclaimed shares account, the credit union shall mail a written notice to the member at
1048 the member's last known address stating that this action will be taken within 30 days of the date
1049 of the notice.
1050 Section 24. Section 7-9-39.5 is amended to read:
1051 7-9-39.5. Supervisory merger.
1052 If a credit union is merged with another credit union as a result of a supervisory action
1053 under [
1054 Chapter 19, Acquisition of Failing Repository Institutions or Holding Companies, the
1055 commissioner may permit the surviving credit union to have a field of membership that is
1056 larger than a field of membership permitted under Section 7-9-51 .
1057 Section 25. Section 7-9-42 is amended to read:
1058 7-9-42. Record requirements.
1059 (1) A credit union shall maintain all books, records, accounting systems, and procedures
1060 in accordance with rules the commissioner may prescribe or in accordance with Chapter 1,
1061 General Provisions.
1062 (2) In prescribing these rules, the commissioner shall consider the size of a credit union
1063 and its ability to comply.
1064 (3) A credit union is not liable for destroying records after the expiration of the record
1065 retention time prescribed by the rules.
1066 (4) A photostatic or photographic reproduction of any credit union records shall be
1067 admissible as evidence of transactions with the credit union.
1068 Section 26. Section 7-9-45 is amended to read:
1069 7-9-45. Insurance of shares and deposits -- Security on shares and deposits.
1070 (1) Except as provided in Subsection (2), a credit union subject to the jurisdiction of the
1071 department shall obtain and maintain insurance on shares and deposits from the National Credit
1072 Union Administration or successor federal deposit insurance agency.
1073 (2) Notwithstanding Subsection 7-1-704 (7)(a)(v) and Subsection (1), a credit union
1074 may not be required to obtain federal insurance on shares and deposits if:
1075 (a) the commissioner approves the credit union's election not to obtain federal
1076 insurance on shares and deposits;
1077 (b) as security for the shares and deposits, the credit union maintains securities:
1078 (i) that are issued by or directly and unconditionally guaranteed by:
1079 (A) the United States; or
1080 (B) an agency of the United States;
1081 (ii) that are held in an account with a primary reporting dealer that is:
1082 (A) recognized by the Federal Reserve Bank of New York; and
1083 (B) independent of the credit union;
1084 (iii) that are held in accordance with Title 70A, Chapter 8, Uniform Commercial Code
1085 - Investment Securities; and
1086 (iv) in which the department has an express and exclusive security interest; and
1087 (c) the aggregate value of the securities described in Subsection (2)(b) is at all times
1088 equal to or greater than 1.15 times the aggregate amount of the shares and deposits of the credit
1090 (3) The commissioner may appoint the administrator of the National Credit Union
1091 Administration as liquidating agent of an insured credit union.
1092 (4) Failure to comply with this section constitutes grounds for supervisory action under
1094 19, Acquisition of Failing Repository Institutions or Holding Companies.
1095 Section 27. Section 7-9-55 is amended to read:
1096 7-9-55. Nonexempt credit unions.
1097 (1) (a) A credit union organized under this chapter is a nonexempt credit union under
1098 this section on the day on which:
1099 (i) on or after May 5, 2003 the credit union has a field of membership as evidenced by
1100 the bylaws of the credit union that includes all residents of two or more counties; and
1101 (ii) at least two of the counties described in Subsection (1)(a)(i) are counties of the first
1102 or second class as classified by Section 17-50-501 .
1103 (b) For purposes of Subsection (1)(a) only:
1104 (i) residents of a county that are added to the field of membership of a credit union as a
1105 result of a supervisory action under [
1106 Institution by Commissioner, or Chapter 19, Acquisition of Failing Repository Institutions or
1107 Holding Companies, are not considered to be within the field of membership of that credit
1108 union; and
1109 (ii) residents of a city of the third, fourth, or fifth class or a town that are added to the
1110 field of membership of a credit union in accordance with Section 7-9-52 are not considered to
1111 be within the field of membership of that credit union unless all residents of the county in
1112 which that city or town are located are included in the field of membership of the credit union.
1113 (2) If a credit union becomes a nonexempt credit union under this section, the
1114 nonexempt credit union is a nonexempt credit union:
1115 (a) for as long as the nonexempt credit union is organized under this chapter; and
1116 (b) notwithstanding whether after the day on which the nonexempt credit union
1117 becomes a nonexempt credit union the nonexempt credit union meets the requirements of
1118 Subsection (1)(a).
1119 (3) Regardless of whether or not a credit union has located branches in two or more
1120 counties in this state, a credit union organized under this chapter does not become a nonexempt
1121 credit union if the field of membership of the credit union as evidenced by the bylaws of the
1122 credit union does not meet the requirements of Subsection (1).
1123 Section 28. Section 7-9-58 is amended to read:
1124 7-9-58. Limitations on credit extended by nonexempt credit unions.
1125 (1) (a) Notwithstanding the other provisions of this chapter, beginning on May 5, 2003,
1126 a nonexempt credit union may not:
1127 (i) (A) extend a member-business loan;
1128 (B) renew a member-business loan that is extended before May 5, 2003; or
1129 (C) extend the maturity date or increase the amount of a member-business loan that is
1130 extended before May 5, 2003;
1131 (ii) originate, participate in, or obtain any interest in a co-lending arrangement,
1132 including a loan participation arrangement; or
1133 (iii) subject to Subsection (2), extend credit that is not a member-business loan if as a
1134 result of the extension of credit the total credit that is not a member-business loan that the
1135 nonexempt credit union has issued to that member exceeds at any one time $250,000 adjusted
1136 as provided in Subsection (1)(b).
1137 (b) The adjustment described in Subsection (1)(a)(iii) shall be calculated by the
1138 commissioner as follows:
1139 (i) beginning July 1, 2008 and for a calendar year beginning on or after January 1,
1140 2009, the commissioner shall increase or decrease the dollar amount in Subsection (1)(a)(iii) by
1141 a percentage equal to the percentage difference between the consumer price index for the
1142 preceding calendar year and the consumer price index for calendar year 2007;
1143 (ii) after the commissioner increases the dollar amount listed in Subsection [
1144 (1)(a)(iii), the commissioner shall round the dollar amount to the nearest whole dollar;
1145 (iii) if the percentage difference under Subsection (1)(b)(i) is zero or a negative
1146 percentage, the consumer price index increase for the year is zero; and
1147 (iv) for purposes of this Subsection (1)(b), the commissioner shall calculate the
1148 consumer price index as provided in Sections 1(f)(4) and 1(f)(5), Internal Revenue Code.
1149 (2) Notwithstanding Subsection (1)(a)(iii), a nonexempt credit union may extend credit
1150 in an amount that exceeds the limits provided in Subsection (1)(a)(iii) to a member if:
1151 (a) the excess portion of the credit described in Subsection (1)(a)(iii) is fully secured by
1152 the member's share or deposit savings in the nonexempt credit union; or
1153 (b) the credit is extended to a member of the nonexempt credit union:
1154 (i) for the purpose of:
1155 (A) paying amounts owed by the member to purchase a one- to four-family dwelling
1156 that is the primary residence of that member; or
1157 (B) refinancing the balance of amounts owed by the member for the purchase of a one-
1158 to four-family dwelling that is the primary residence of that member; and
1159 (ii) the credit extended under this Subsection (2)(b) is less than or equals $1,000,000.
1160 (3) In accordance with Subsection 7-9-20 (7)(d), a credit union service organization
1161 may not extend credit to a member of a nonexempt credit union holding an ownership interest
1162 in the credit union service organization if it would be a violation of this section for the
1163 nonexempt credit union to extend the credit to the member.
1164 (4) This section may not prevent a nonexempt credit union from servicing a loan
1165 extended before May 5, 2003.
1166 Section 29. Section 7-14-1 is amended to read:
1167 7-14-1. Definitions.
1168 As used in this chapter:
1170 maintained by an association of financial institutions or one or more associations of merchants.
1172 law to accept and hold demand deposits or other accounts which may be used to effect third
1173 party payment transactions. The definition of "depository institution" in Chapter 1, General
1174 Provisions, does not apply to Chapter 14, Credit Information Exchange.
1175 Section 30. Section 7-19-1 is amended to read:
1176 7-19-1. Definitions.
1177 As used in this chapter:
1178 (1) "Failing or failed depository institution" means a depository institution under the
1179 jurisdiction of the department:
1180 (a) regarding which the commissioner makes a finding that any of the conditions set
1181 forth in Subsections 7-2-1 (1)(a) through (k) exist;
1182 (b) that meets the requirements of Subsection 7-2-1 (1)(l);
1183 (c) whose shareholders have consented to a supervisory action by the commissioner
1184 pursuant to Subsection 7-2-1 (2); or
1185 (d) which is in the possession of the commissioner, or any receiver or liquidator
1186 appointed by the commissioner, pursuant to Chapter 2, Possession of Depository Institution by
1188 (2) "Failing or failed depository institution holding company" means a depository
1189 institution holding company under the jurisdiction of the department:
1190 (a) regarding which the commissioner makes a finding that any of the conditions set
1191 forth in Subsections 7-2-1 (1)(a) through (k) exist;
1192 (b) that meets the requirements of Subsection 7-2-1 (1)(l);
1193 (c) whose shareholders have consented to a supervisory action by the commissioner
1194 pursuant to Subsection 7-2-1 (2);
1195 (d) which is in the possession of the commissioner, or any receiver or liquidator
1196 appointed by the commissioner, pursuant to Chapter 2, Possession of Depository Institution by
1197 Commissioner; or
1198 (e) whose subsidiary depository institution is a failing or failed depository institution.
1199 (3) "Supervisory acquisition" means the acquisition of control, the acquisition of all or
1200 a portion of the assets, or the assumption of all or a portion of the liabilities, pursuant to
1201 Section 7-2-1 , 7-2-12 , or 7-2-18 , of a failing or failed depository institution or a failing or
1202 failed depository institution holding company, whether or not in the possession of the
1203 commissioner, by:
1204 (a) a Utah depository institution;
1205 (b) an out-of-state depository institution;
1206 (c) a Utah depository institution holding company; or
1207 (d) an out-of-state depository institution holding company.
1208 (4) "Supervisory merger" means the merger or consolidation, pursuant to Section
1209 7-2-1 , 7-2-12 , or 7-2-18 of a failing or failed depository institution or a failing or failed
1210 depository institution holding company, whether or not in the possession of the commissioner,
1212 (a) a Utah depository institution;
1213 (b) an out-of-state depository institution;
1214 (c) a Utah depository institution holding company; or
1215 (d) an out-of-state depository institution holding company.
1216 Section 31. Section 9-1-801 is amended to read:
1218 9-1-801. Title.
1219 This part is known as the "[
1220 Commission on Service and Volunteerism Act."
1221 Section 32. Section 9-6-205 is amended to read:
1222 9-6-205. Board powers and duties.
1223 (1) The board may:
1224 (a) make, amend, or repeal rules for the conduct of its business in governing the
1225 council in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act;
1226 (b) receive gifts, bequests, and property; and
1227 (c) issue certificates and offer and confer prizes, certificates, and awards for works of
1228 art and achievement in the arts.
1229 (2) The board shall make policy for the council.
1230 (3) (a) By September 30 of each year, the board shall prepare and submit a request to
1231 the governor and the Legislature for prioritized capital facilities grants to be awarded to eligible
1232 individuals and organizations under this part [
1233 Part 4, Utah Percentage-for-Art Act, and Part 5, State Arts Endowment.
1234 (b) The board shall prepare a list of the requested capital facilities grants in a
1235 prioritized order and include a written explanation of:
1236 (i) the total grant amount requested in the list; and
1237 (ii) the basis of its prioritization of requested grants on the list.
1238 (c) The board shall accept applications for capital facilities grants through June 1 of
1239 each year, prior to compiling and submitting its yearly request to the governor and the
1240 Legislature under Subsection (3)(a).
1241 Section 33. Section 9-7-501 is amended to read:
1242 9-7-501. Tax for establishment and maintenance of public library -- Library
1244 (1) A county legislative body may establish and maintain a public library.
1245 (2) For this purpose, counties may levy annually a tax not to exceed .001 of taxable
1246 value of taxable property in the county, outside of cities which maintain their own city libraries
1247 as authorized by Part 4, City Libraries. The tax is in addition to all taxes levied by counties and
1248 is not limited by the levy limitation imposed on counties by law. However, if bonds are issued
1249 for purchasing a site, or constructing or furnishing a building, then taxes sufficient for the
1250 payment of the bonds and any interest may be levied.
1251 (3) The taxes shall be levied and collected in the same manner as other general taxes of
1252 the county and shall constitute a fund to be known as the county library fund.
1253 Section 34. Section 9-8-301 is amended to read:
1254 9-8-301. Purpose.
1255 (1) The Legislature declares that the general public and the beneficiaries of the school
1256 and institutional land grants have an interest in the preservation and protection of the state's
1257 archaeological and anthropological resources and a right to the knowledge derived and gained
1258 from scientific study of those resources.
1259 (2) (a) The Legislature finds that policies and procedures for the survey and excavation
1260 of archaeological resources from school and institutional trust lands are consistent with the
1261 school and institutional land grants, if these policies and procedures insure that primary
1262 consideration is given, on a site or project specific basis, to the purpose of support for the
1263 beneficiaries of the school and institutional land grants.
1264 (b) The Legislature finds that the preservation, placement in a repository, curation, and
1265 exhibition of specimens found on school or institutional trust lands for scientific and
1266 educational purposes is consistent with the school and institutional land grants.
1267 (c) The Legislature finds that the preservation and development of sites found on
1268 school or institutional trust lands for scientific or educational purposes, or the disposition of
1269 sites found on school or institutional trust lands, after consultation between the division and the
1270 School and Institutional Trust Lands Administration to determine the appropriate level of data
1271 recovery or implementation of other appropriate preservation measures, for preservation,
1272 development, or economic purposes, is consistent with the school and institutional land grants.
1273 (d) The Legislature declares that specimens found on lands owned or controlled by the
1274 state or its subdivisions may not be sold.
1275 (3) The Legislature declares that the historical preservation purposes of this chapter
1276 must be kept in balance with the other uses of land and natural resources which benefit the
1277 health and welfare of the state's citizens.
1278 (4) It is the purpose of this part and Part 4, Historic Sites, to provide that the survey,
1279 excavation, curation, study, and exhibition of the state's archaeological and anthropological
1280 resources be undertaken in a coordinated, professional, and organized manner for the general
1281 welfare of the public and beneficiaries alike.
1282 Section 35. Section 9-8-307 is amended to read:
1283 9-8-307. Report of discovery on state or private lands.
1284 (1) Any person who discovers any archaeological resources on lands owned or
1285 controlled by the state or its subdivisions shall promptly report the discovery to the division.
1286 (2) Any person who discovers any archaeological resources on privately owned lands
1287 shall promptly report the discovery to the division.
1288 (3) Field investigations shall be discouraged except in accordance with this part and
1289 Part 4, Historic Sites.
1290 (4) Nothing in this section may be construed to authorize any person to survey or
1291 excavate for archaeological resources.
1292 Section 36. Section 9-8-405 is amended to read:
1293 9-8-405. Federal funds -- Agreements on standards and procedures.
1294 By following the procedures and requirements of Title 63J, Chapter 5, Federal Funds
1295 Procedures Act, the division may accept and administer federal funds provided under the
1296 provisions of the National Historic Preservation Act of 1966, the Land and Water Conservation
1297 Act as amended, and subsequent legislation directed toward the encouragement of historic
1298 preservation, and to enter into those agreements on professional standards and procedures
1299 required by participation in the National Historic Preservation Act of 1966 and the National
1300 Register Office.
1301 Section 37. Section 10-1-114 is amended to read:
1302 10-1-114. Repealer.
1303 Title 10, [
1304 Incorporation, Classification, Boundaries, Consolidation, and Dissolution of Municipalities;
1305 Chapter 3, Municipal Government; Chapter 5, Uniform Fiscal Procedures Act for Utah Towns;
1306 and Chapter 6, Uniform Fiscal Procedures Act for Utah Cities, are repealed, except as provided
1307 in Section 10-1-115 .
1308 Section 38. Section 10-1-119 is amended to read:
1309 10-1-119. Inventory of competitive activities.
1310 (1) As used in this section:
1311 (a) "Applicable city" means:
1312 (i) on and after July 1, 2009, a city of the first class; and
1313 (ii) on and after July 1, 2010, a city of the first or second class.
1314 (b) "Competitive activity" means an activity engaged in by a city or an entity created by
1315 the city by which the city or an entity created by the city provides a good or service that is
1316 substantially similar to a good or service that is provided by a person:
1317 (i) who is not an entity of the federal government, state government, or a political
1318 subdivision of the state; and
1319 (ii) within the boundary of the county in which the city is located.
1320 (c) (i) Subject to Subsection (1)(c)(ii), "entity created by the city" includes:
1321 (A) an entity created by an interlocal agreement under Title 11, Chapter 13, Interlocal
1322 Cooperation Act, in which the city participates; and
1323 (B) a special service district created under Title 17D, Chapter 1, Special Service
1324 District Act.
1325 (ii) "Entity created by the city" does not include a local district created by a city under
1326 Title 17B, Limited Purpose Local Government Entities - Local Districts.
1327 (2) (a) The governing body of an applicable city shall create an inventory of activities
1328 of the city or an entity created by the city to:
1329 (i) classify whether an activity is a competitive activity; and
1330 (ii) identify efforts that have been made to privatize aspects of the activity.
1331 (b) An applicable city shall comply with this section by no later than:
1332 (i) June 30, 2010, if the applicable city is a city of the first class; and
1333 (ii) June 30, 2011, if the applicable city is a city of the second class.
1334 (3) The governing body of an applicable city shall update the inventory created under
1335 this section at least every two years.
1336 (4) An applicable city shall:
1337 (a) provide a copy of the inventory and an update to the inventory to the Free Market
1338 Protection and Privatization Board created in Title 63I, Chapter 4a[
1340 (b) make the inventory available to the public through electronic means.
1341 Section 39. Section 10-1-203 is amended to read:
1342 10-1-203. License fees and taxes -- Application information to be transmitted to
1343 the county assessor.
1344 (1) As used in this section:
1345 (a) "Business" means any enterprise carried on for the purpose of gain or economic
1346 profit, except that the acts of employees rendering services to employers are not included in
1347 this definition.
1348 (b) "Telecommunications provider" is as defined in Section 10-1-402 .
1349 (c) "Telecommunications tax or fee" is as defined in Section 10-1-402 .
1350 (2) Except as provided in Subsections (3) through (5), the legislative body of a
1351 municipality may license for the purpose of regulation and revenue any business within the
1352 limits of the municipality and may regulate that business by ordinance.
1353 (3) (a) The legislative body of a municipality may raise revenue by levying and
1354 collecting a municipal energy sales or use tax as provided in Part 3, Municipal Energy Sales
1355 and Use Tax Act, except a municipality may not levy or collect a franchise tax or fee on an
1356 energy supplier other than the municipal energy sales and use tax provided in Part 3, Municipal
1357 Energy Sales and Use Tax Act.
1358 (b) (i) Subsection (3)(a) does not affect the validity of a franchise agreement as defined
1359 in Subsection 10-1-303 (6), that is in effect on July 1, 1997, or a future franchise.
1360 (ii) A franchise agreement as defined in Subsection 10-1-303 (6) in effect on January 1,
1361 1997, or a future franchise shall remain in full force and effect.
1362 (c) A municipality that collects a contractual franchise fee pursuant to a franchise
1363 agreement as defined in Subsection 10-1-303 (6) with an energy supplier that is in effect on July
1364 1, 1997, may continue to collect that fee as provided in Subsection 10-1-310 (2).
1365 (d) (i) Subject to the requirements of Subsection (3)(d)(ii), a franchise agreement as
1366 defined in Subsection 10-1-303 (6) between a municipality and an energy supplier may contain
1367 a provision that:
1368 (A) requires the energy supplier by agreement to pay a contractual franchise fee that is
1369 otherwise prohibited under Part 3, Municipal Energy Sales and Use Tax Act; and
1370 (B) imposes the contractual franchise fee on or after the day on which Part 3,
1371 Municipal Energy Sales and Use Tax Act is:
1372 (I) repealed, invalidated, or the maximum allowable rate provided in Section 10-1-305
1373 is reduced; and
1374 (II) is not superseded by a law imposing a substantially equivalent tax.
1375 (ii) A municipality may not charge a contractual franchise fee under the provisions
1376 permitted by Subsection (3)(b)(i) unless the municipality charges an equal contractual franchise
1377 fee or a tax on all energy suppliers.
1378 (4) (a) Subject to Subsection (4)(b), beginning July 1, 2004, the legislative body of a
1379 municipality may raise revenue by levying and providing for the collection of a municipal
1380 telecommunications license tax as provided in Part 4, Municipal Telecommunications License
1381 Tax Act.
1382 (b) A municipality may not levy or collect a telecommunications tax or fee on a
1383 telecommunications provider except as provided in Part 4, Municipal Telecommunications
1384 License Tax Act.
1385 (5) (a) (i) The legislative body of a municipality may by ordinance raise revenue by
1386 levying and collecting a license fee or tax on:
1387 (A) a parking service business in an amount that is less than or equal to:
1388 (I) $1 per vehicle that parks at the parking service business; or
1389 (II) 2% of the gross receipts of the parking service business;
1390 (B) a public assembly or other related facility in an amount that is less than or equal to
1391 $5 per ticket purchased from the public assembly or other related facility; and
1392 (C) subject to the limitations of Subsections (5)(c) and (d):
1393 (I) a business that causes disproportionate costs of municipal services; or
1394 (II) a purchaser from a business for which the municipality provides an enhanced level
1395 of municipal services.
1396 (ii) Nothing in this Subsection (5)(a) may be construed to authorize a municipality to
1397 levy or collect a license fee or tax on a public assembly or other related facility owned and
1398 operated by another political subdivision other than a community development and renewal
1399 agency without the written consent of the other political subdivision.
1400 (b) As used in this Subsection (5):
1401 (i) "Municipal services" includes:
1402 (A) public utilities; and
1403 (B) services for:
1404 (I) police;
1405 (II) fire;
1406 (III) storm water runoff;
1407 (IV) traffic control;
1408 (V) parking;
1409 (VI) transportation;
1410 (VII) beautification; or
1411 (VIII) snow removal.
1412 (ii) "Parking service business" means a business:
1413 (A) that primarily provides off-street parking services for a public facility that is
1414 wholly or partially funded by public money;
1415 (B) that provides parking for one or more vehicles; and
1416 (C) that charges a fee for parking.
1417 (iii) "Public assembly or other related facility" means an assembly facility that:
1418 (A) is wholly or partially funded by public money;
1419 (B) is operated by a business; and
1420 (C) requires a person attending an event at the assembly facility to purchase a ticket.
1421 (c) (i) Before the legislative body of a municipality imposes a license fee on a business
1422 that causes disproportionate costs of municipal services under Subsection (5)(a)(i)(C)(I), the
1423 legislative body of the municipality shall adopt an ordinance defining for purposes of the tax
1424 under Subsection (5)(a)(i)(C)(I):
1425 (A) the costs that constitute disproportionate costs; and
1426 (B) the amounts that are reasonably related to the costs of the municipal services
1427 provided by the municipality.
1428 (ii) The amount of a fee under Subsection (5)(a)(i)(C)(I) shall be reasonably related to
1429 the costs of the municipal services provided by the municipality.
1430 (d) (i) Before the legislative body of a municipality imposes a license fee on a
1431 purchaser from a business for which it provides an enhanced level of municipal services under
1432 Subsection (5)(a)(i)(C)(II), the legislative body of the municipality shall adopt an ordinance
1433 defining for purposes of the fee under Subsection (5)(a)(i)(C)(II):
1434 (A) the level of municipal services that constitutes the basic level of municipal services
1435 in the municipality; and
1436 (B) the amounts that are reasonably related to the costs of providing an enhanced level
1437 of municipal services in the municipality.
1438 (ii) The amount of a fee under Subsection (5)(a)(i)(C)(II) shall be reasonably related to
1439 the costs of providing an enhanced level of the municipal services.
1440 (6) All license fees and taxes shall be uniform in respect to the class upon which they
1441 are imposed.
1442 (7) The municipality shall transmit the information from each approved business
1443 license application to the county assessor within 60 days following the approval of the
1445 (8) If challenged in court, an ordinance enacted by a municipality before January 1,
1446 1994, imposing a business license fee on rental dwellings under this section shall be upheld
1447 unless the business license fee is found to impose an unreasonable burden on the fee payer.
1448 Section 40. Section 10-2-125 is amended to read:
1449 10-2-125. Incorporation of a town -- Petition.
1450 (1) As used in this section:
1451 (a) "Assessed value," with respect to agricultural land, means the value at which the
1452 land would be assessed without regard to a valuation for agricultural use under Section
1453 59-2-503 .
1454 (b) "Financial feasibility study" means a study described in Subsection [
1455 (c) "Feasibility consultant" means a person or firm:
1456 (i) with expertise in the processes and economics of local government; and
1457 (ii) who is independent of and not affiliated with a county or sponsor of a petition to
1459 (d) "Municipal service" means a publicly provided service that is not provided on a
1460 countywide basis.
1461 (e) "Nonurban" means having a residential density of less than one unit per acre.
1462 (2) (a) (i) A contiguous area of a county not within a municipality, with a population of
1463 at least 100 but less than 1,000, may incorporate as a town as provided in this section.
1464 (ii) An area within a county of the first class is not contiguous for purposes of
1465 Subsection (2)(a)(i) if:
1466 (A) the area includes a strip of land that connects geographically separate areas; and
1467 (B) the distance between the geographically separate areas is greater than the average
1468 width of the strip of land connecting the geographically separate areas.
1469 (b) The population figure under Subsection (2)(a) shall be determined:
1470 (i) as of the date the incorporation petition is filed; and
1471 (ii) by the Utah Population Estimates Committee within 20 days after the county clerk's
1472 certification under Subsection (6) of a petition filed under Subsection (4).
1473 (3) (a) The process to incorporate an area as a town is initiated by filing a petition to
1474 incorporate the area as a town with the clerk of the county in which the area is located.
1475 (b) A petition under Subsection (3)(a) shall:
1476 (i) be signed by:
1477 (A) the owners of private real property that:
1478 (I) is located within the area proposed to be incorporated; and
1479 (II) is equal in assessed value to more than 1/5 of the assessed value of all private real
1480 property within the area; and
1481 (B) 1/5 of all registered voters within the area proposed to be incorporated as a town,
1482 according to the official voter registration list maintained by the county on the date the petition
1483 is filed;
1484 (ii) designate as sponsors at least five of the property owners who have signed the
1485 petition, one of whom shall be designated as the contact sponsor, with the mailing address of
1486 each owner signing as a sponsor;
1487 (iii) be accompanied by and circulated with an accurate map or plat, prepared by a
1488 licensed surveyor, showing a legal description of the boundary of the proposed town; and
1489 (iv) substantially comply with and be circulated in the following form:
1490 PETITION FOR INCORPORATION OF (insert the proposed name of the proposed
1492 To the Honorable County Legislative Body of (insert the name of the county in which
1493 the proposed town is located) County, Utah:
1494 We, the undersigned owners of real property and registered voters within the area
1495 described in this petition, respectfully petition the county legislative body to submit to the
1496 registered voters residing within the area described in this petition, at the next regular general
1497 election, the question of whether the area should incorporate as a town. Each of the
1498 undersigned affirms that each has personally signed this petition and is an owner of real
1499 property or a registered voter residing within the described area, and that the current residence
1500 address of each is correctly written after the signer's name. The area proposed to be
1501 incorporated as a town is described as follows: (insert an accurate description of the area
1502 proposed to be incorporated).
1503 (c) A petition under this Subsection (3) may not describe an area that includes some or
1504 all of an area proposed for annexation in an annexation petition under Section 10-2-403 that:
1505 (i) was filed before the filing of the petition; and
1506 (ii) is still pending on the date the petition is filed.
1507 (d) A petition may not be filed under this section if the private real property owned by
1508 the petition sponsors, designated under Subsection (3)(b)(ii), cumulatively exceeds 40% of the
1509 total private land area within the area proposed to be incorporated as a town.
1510 (e) A signer of a petition under this Subsection (3) may withdraw or, after withdrawn,
1511 reinstate the signer's signature on the petition:
1512 (i) at any time until the county clerk certifies the petition under Subsection (5); and
1513 (ii) by filing a signed, written withdrawal or reinstatement with the county clerk.
1514 (4) (a) If a petition is filed under Subsection (3)(a) proposing to incorporate as a town
1515 an area located within a county of the first class, the county clerk shall deliver written notice of
1516 the proposed incorporation:
1517 (i) to each owner of private real property owning more than 1% of the assessed value
1518 of all private real property within the area proposed to be incorporated as a town; and
1519 (ii) within seven calendar days after the date on which the petition is filed.
1520 (b) A private real property owner described in Subsection (4)(a)(i) may exclude all or
1521 part of the owner's property from the area proposed to be incorporated as a town by filing a
1522 notice of exclusion:
1523 (i) with the county clerk; and
1524 (ii) within 10 calendar days after receiving the clerk's notice under Subsection (4)(a).
1525 (c) The county legislative body shall exclude from the area proposed to be incorporated
1526 as a town the property identified in the notice of exclusion under Subsection (4)(b) if:
1527 (i) the property:
1528 (A) is nonurban; and
1529 (B) does not and will not require a municipal service; and
1530 (ii) exclusion will not leave an unincorporated island within the proposed town.
1531 (d) If the county legislative body excludes property from the area proposed to be
1532 incorporated as a town, the county legislative body shall send written notice of the exclusion to
1533 the contact sponsor within five days after the exclusion.
1534 (5) No later than 20 days after the filing of a petition under Subsection (3), the county
1535 clerk shall:
1536 (a) with the assistance of other county officers from whom the clerk requests
1537 assistance, determine whether the petition complies with the requirements of Subsection (3);
1539 (b) (i) if the clerk determines that the petition complies with those requirements:
1540 (A) certify the petition and deliver the certified petition to the county legislative body;
1542 (B) mail or deliver written notification of the certification to:
1543 (I) the contact sponsor;
1544 (II) if applicable, the chair of the planning commission of each township in which any
1545 part of the area proposed for incorporation is located; and
1546 (III) the Utah Population Estimates Committee; or
1547 (ii) if the clerk determines that the petition fails to comply with any of those
1548 requirements, reject the petition and notify the contact sponsor in writing of the rejection and
1549 the reasons for the rejection.
1550 (6) (a) (i) A petition that is rejected under Subsection (5)(b)(ii) may be amended to
1551 correct a deficiency for which it was rejected and then refiled with the county clerk.
1552 (ii) A valid signature on a petition filed under Subsection (3)(a) may be used toward
1553 fulfilling the signature requirement of Subsection (3)(b) for the same petition that is amended
1554 under Subsection (6)(a)(i) and then refiled with the county clerk.
1555 (b) If a petition is amended and refiled under Subsection (6)(a)(i) after having been
1556 rejected by the county clerk under Subsection (5)(b)(ii):
1557 (i) the amended petition shall be considered as a newly filed petition; and
1558 (ii) the amended petition's processing priority is determined by the date on which it is
1560 (7) (a) (i) The legislative body of a county with which a petition is filed under
1561 Subsection (4) and certified under Subsection (6) shall commission and pay for a financial
1562 feasibility study.
1563 (ii) The feasibility consultant shall be chosen:
1564 (A) (I) by the contact sponsor of the incorporation petition, as described in Subsection
1565 (3)(b)(ii), with the consent of the county; or
1566 (II) by the county if the contact sponsor states, in writing, that the sponsor defers
1567 selection of the feasibility consultant to the county; and
1568 (B) in accordance with applicable county procurement procedure.
1569 (iii) The county legislative body shall require the feasibility consultant to complete the
1570 financial feasibility study and submit written results of the study to the county legislative body
1571 no later than 30 days after the feasibility consultant is engaged to conduct the financial
1572 feasibility study.
1573 (b) The financial feasibility study shall consider the:
1574 (i) population and population density within the area proposed for incorporation and
1575 the surrounding area;
1576 (ii) current and five-year projections of demographics and economic base in the
1577 proposed town and surrounding area, including household size and income, commercial and
1578 industrial development, and public facilities;
1579 (iii) projected growth in the proposed town and in adjacent areas during the next five
1581 (iv) subject to Subsection (7)(c), the present and five-year projections of the cost,
1582 including overhead, of governmental services in the proposed town, including:
1583 (A) culinary water;
1584 (B) secondary water;
1585 (C) sewer;
1586 (D) law enforcement;
1587 (E) fire protection;
1588 (F) roads and public works;
1589 (G) garbage;
1590 (H) weeds; and
1591 (I) government offices;
1592 (v) assuming the same tax categories and tax rates as currently imposed by the county
1593 and all other current service providers, the present and five-year projected revenue for the
1594 proposed town; and
1595 (vi) a projection of any new taxes per household that may be levied within the
1596 incorporated area within five years of incorporation.
1597 (c) (i) For purposes of Subsection (7)(b)(iv), the feasibility consultant shall assume a
1598 level and quality of governmental services to be provided to the proposed town in the future
1599 that fairly and reasonably approximate the level and quality of governmental services being
1600 provided to the proposed town at the time of the feasibility study.
1601 (ii) In determining the present cost of a governmental service, the feasibility consultant
1602 shall consider:
1603 (A) the amount it would cost the proposed town to provide governmental service for
1604 the first five years after incorporation; and
1605 (B) the county's present and five-year projected cost of providing governmental
1607 (iii) The costs calculated under Subsection (7)(b)(iv), shall take into account inflation
1608 and anticipated growth.
1609 (d) If the five year projected revenues under Subsection (7)(b)(v) exceed the five-year
1610 projected costs under Subsection (7)(b)(iv) by more than 10%, the feasibility consultant shall
1611 project and report the expected annual revenue surplus to the contact sponsor and the lieutenant
1613 (e) The county legislative body shall approve a certified petition proposing the
1614 incorporation of a town and hold a public hearing as provided in Section 10-2-126 .
1615 Section 41. Section 10-2-126 is amended to read:
1616 10-2-126. Incorporation of town -- Public hearing on feasibility.
1617 (1) If, in accordance with Section 10-2-125 , the county clerk certifies a petition for
1618 incorporation or an amended petition for incorporation, the county legislative body shall, at its
1619 next regular meeting after completion of the feasibility study, schedule a public hearing to:
1620 (a) be held no later than 60 days after the day on which the feasibility study is
1621 completed; and
1622 (b) consider, in accordance with Subsection (3)(b), the feasibility of incorporation for
1623 the proposed town.
1624 (2) The county legislative body shall give notice of the public hearing on the proposed
1625 incorporation by:
1626 (a) posting notice of the public hearing on the county's Internet website, if the county
1627 has an Internet website;
1628 (b) (i) publishing notice of the public hearing at least once a week for two consecutive
1629 weeks in a newspaper of general circulation within the proposed town; or
1630 (ii) if there is no newspaper of general circulation within the proposed town, posting
1631 notice of the public hearing in at least five conspicuous public places within the proposed
1632 town; and
1633 (c) publishing notice of the public hearing on the Utah Public Notice Website created
1634 in Section 63F-1-701 .
1635 (3) At the public hearing scheduled in accordance with Subsection (1), the county
1636 legislative body shall:
1637 (a) (i) provide a copy of the feasibility study; and
1638 (ii) present the results of the feasibility study to the public; and
1639 (b) allow the public to:
1640 (i) review the map or plat of the boundary of the proposed town;
1641 (ii) ask questions and become informed about the proposed incorporation; and
1642 (iii) express its views about the proposed incorporation, including their views about the
1643 boundary of the area proposed to be incorporated.
1644 (4) A county may not hold an election on the incorporation of a town in accordance
1645 with Section 10-2-127 if the results of the feasibility study show that the five-year projected
1646 revenues under Subsection 10-2-125 (7)(b)(v) exceed the five-year projected costs under
1647 Subsection 10-2-125 (7)(b)(iv) by more than 10%.
1648 Section 42. Section 10-8-62 is amended to read:
1649 10-8-62. Cemeteries -- Purchase and operation.
1650 The city legislative body may:
1651 (1) purchase, hold, and pay for lands within or without the corporate limits for the
1652 burial of the dead, and all necessary grounds for hospitals;
1653 (2) have and exercise police jurisdiction over those lands, and over any cemetery used
1654 by the inhabitants of the city;
1655 (3) survey, plat, map, fence, ornament, and otherwise improve, manage, and operate
1656 public burial and cemetery grounds;
1657 (4) convey cemetery lots owned by the city, and pass ordinances for the protection and
1658 governing of these grounds consistent with Title 8, Chapter 5, [
1659 and Title to Cemetery Lots;
1660 (5) contract for the care and improvement of cemeteries and cemetery lots, and for any
1661 compensation for the care and improvement;
1662 (6) receive deposits for the care of lots and invest the deposits by following the
1663 procedures and requirements of Title 51, Chapter 7, State Money Management Act; and
1664 (7) pay the cost of the care from any proceeds from the investment.
1665 Section 43. Section 10-8-63 is amended to read:
1666 10-8-63. Burial of dead -- Vital statistics.
1667 They may regulate the burial of the dead, consistent with Title 8, Chapter 5, [
1669 returning and keeping of bills of mortality, and impose penalties on physicians, sextons, and
1670 others for any default therein.
1671 Section 44. Section 10-18-104 is amended to read:
1672 10-18-104. Application to existing contracts.
1673 (1) (a) If before the sooner of March 1 or the effective date of the chapter, the
1674 legislative body of a municipality authorized the municipality to offer or provide cable
1675 television services or public telecommunications services, each authorized service:
1676 (i) is exempt from Part 2, Conditions for Providing Services; and
1677 (ii) is subject to Part 3, Operational Requirements and Limitations.
1678 (b) The exemption described in Subsection (1)(a)(i) may not apply to any cable
1679 television service or public telecommunications service authorized by the legislative body of a
1680 municipality on or after the sooner of March 1 or the effective date of this chapter.
1681 (2) This chapter does not:
1682 (a) invalidate any contract entered into by a municipality before the sooner of March 1
1683 or the effective date of this chapter:
1684 (i) for the design, construction, equipping, operation, or maintenance of facilities used
1685 or to be used by the municipality, or by a private provider under a contract with the
1686 municipality for the purpose of providing:
1687 (A) cable television services; or
1688 (B) public telecommunications services;
1689 (ii) with a private provider for the use of the facilities described in Subsection (2)(a)(i)
1690 in connection with the private provider offering:
1691 (A) cable television services; or
1692 (B) public telecommunications services;
1693 (iii) with a subscriber for providing:
1694 (A) a cable television service; or
1695 (B) a public telecommunications service; or
1696 (iv) to obtain or secure financing for the acquisition or operation of the municipality's
1697 facilities or equipment used in connection with providing:
1698 (A) a cable television service; or
1699 (B) a public telecommunications service; or
1700 (b) impair any security interest granted by a municipality as collateral for the
1701 municipality's obligations under a contract described in Subsection (2)(a).
1702 (3) (a) A municipality meeting the one or more of the following conditions is exempt
1703 from this chapter as provided in Subsection (3)(b):
1704 (i) a municipality that adopts or enacts a bond resolution on or before January 1, 2001,
1705 to fund facilities or equipment that the municipality uses to provide:
1706 (A) cable television services; or
1707 (B) public telecommunications services; or
1708 (ii) a municipality that has operated for at least three years consecutively before the
1709 sooner of March 1 or the effective date of this chapter:
1710 (A) a cable television service; or
1711 (B) a public telecommunications service.
1712 (b) A municipality described in Subsection (3)(a) is exempt from this chapter except
1714 (i) Subsection 10-18-303 (4);
1715 (ii) Subsection 10-18-303 (7);
1716 (iii) Subsection 10-18-303 (9);
1717 (iv) Section 10-18-304 ; and
1718 (v) Section 10-18-305 .
1719 (4) For the time period beginning on the effective date of this chapter and ending on
1720 December 31, 2001, a municipality that operated a cable television service as of January 1,
1721 2001, is exempt from Subsection 10-18-301 (1)(d).
1722 Section 45. Section 11-13-303 is amended to read:
1723 11-13-303. Source of project entity's payment of sales and use tax -- Gross
1724 receipts taxes for facilities providing additional project capacity.
1725 (1) A project entity is not exempt from sales and use taxes under Title 59, Chapter 12,
1726 Sales and Use Tax Act, to the extent provided in Subsection 59-12-104 (2).
1727 (2) A project entity may make payments or prepayments of sales and use taxes, as
1728 provided in Title 63M, Chapter 5, Resource Development Act, from the proceeds of revenue
1729 bonds issued under Section 11-13-218 or other revenues of the project entity.
1730 (3) (a) This Subsection (3) applies with respect to facilities providing additional project
1732 (b) (i) The in lieu excise tax imposed under Title 59, Chapter 8, Gross Receipts Tax on
1733 Certain Corporations Not Required to Pay Corporate Franchise or Income Tax Act, shall be
1734 imposed collectively on all gross receipts derived with respect to the ownership interests of all
1735 project entities and other public agencies in facilities providing additional project capacity as
1736 though all such ownership interests were held by a single project entity.
1737 (ii) The in lieu excise tax shall be calculated as though the gross receipts derived with
1738 respect to all such ownership interests were received by a single taxpayer that has no other
1739 gross receipts.
1740 (iii) The gross receipts attributable to such ownership interests shall consist solely of
1741 gross receipts that are expended by each project entity and other public agency holding an
1742 ownership interest in the facilities for the operation or maintenance of or ordinary repairs or
1743 replacements to the facilities.
1744 (iv) For purposes of calculating the in lieu excise tax, the determination of whether
1745 there is a tax rate and, if so, what the tax rate is shall be governed by Section 59-8-104 , except
1746 that the $10,000,000 figures in Section 59-8-104 indicating the amount of gross receipts that
1747 determine the applicable tax rate shall be replaced with $5,000,000.
1748 (c) Each project entity and public agency owning an interest in the facilities providing
1749 additional project capacity shall be liable only for the portion of the gross receipts tax referred
1750 to in Subsection (3)(b) that is proportionate to its percentage ownership interest in the facilities
1751 and may not be liable for any other gross receipts taxes with respect to its percentage
1752 ownership interest in the facilities.
1753 (d) No project entity or other public agency that holds an ownership interest in the
1754 facilities may be subject to the taxes imposed under Title 59, Chapter 7, Corporate Franchise
1755 and Income Taxes, with respect to those facilities.
1756 (4) For purposes of calculating the gross receipts tax imposed on a project entity or
1757 other public agency under Title 59, Chapter 8, Gross Receipts Tax on Certain Corporations Not
1758 Required to Pay Corporate Franchise or Income Tax Act, or Subsection (3), gross receipts
1759 include only gross receipts from the first sale of capacity, services, or other benefits and do not
1760 include gross receipts from any subsequent sale, resale, or layoff of the capacity, services, or
1761 other benefits.
1762 Section 46. Section 11-13-315 is amended to read:
1763 11-13-315. Taxed interlocal entity.
1764 (1) As used in this section:
1765 (a) "Asset" means funds, money, an account, real or personal property, or personnel.
1766 (b) "Public asset" means:
1767 (i) an asset used by a public entity;
1768 (ii) tax revenue;
1769 (iii) state funds; or
1770 (iv) public funds.
1771 (c) (i) "Taxed interlocal entity" means a project entity that:
1772 (A) is not exempt from a tax or fee in lieu of taxes imposed in accordance with Part 3,
1773 Project Entity Provisions;
1774 (B) does not receive a payment of funds from a federal agency or office, state agency or
1775 office, political subdivision, or other public agency or office other than a payment that does not
1776 materially exceed the greater of the fair market value and the cost of a service provided or
1777 property conveyed by the project entity; and
1778 (C) does not receive, expend, or have the authority to compel payment from tax
1780 (ii) Before and on May 1, 2014, "taxed interlocal entity" includes an interlocal entity
1782 (A) (I) was created before 1981 for the purpose of providing power supply at wholesale
1783 to its members; or
1784 (II) is described in Subsection 11-13-204 (7);
1785 (B) does not receive a payment of funds from a federal agency or office, state agency or
1786 office, political subdivision, or other public agency or office other than a payment that does not
1787 materially exceed the greater of the fair market value and the cost of a service provided or
1788 property conveyed by the interlocal entity; and
1789 (C) does not receive, expend, or have the authority to compel payment from tax
1791 (d) (i) "Use" means to use, own, manage, hold, keep safe, maintain, invest, deposit,
1792 administer, receive, expend, appropriate, disburse, or have custody.
1793 (ii) "Use" includes, when constituting a noun, the corresponding nominal form of each
1794 term in Subsection (1)(d)(i), individually.
1795 (2) Notwithstanding any other provision of law, the use of an asset by a taxed interlocal
1796 entity does not constitute the use of a public asset.
1797 (3) Notwithstanding any other provision of law, a taxed interlocal entity's use of an
1798 asset that was a public asset prior to the taxed interlocal entity's use of the asset does not
1799 constitute a taxed interlocal entity's use of a public asset.
1800 (4) Notwithstanding any other provision of law, an official of a project entity is not a
1801 public treasurer.
1802 (5) Notwithstanding any other provision of law, a taxed interlocal entity's governing
1803 body, as described in Section 11-13-206 , shall determine and direct the use of an asset by the
1804 taxed interlocal entity.
1805 (6) (a) A taxed interlocal entity is not subject to the provisions of Title 63G, Chapter
1806 6a, Utah Procurement Code.
1807 (b) An agent of a taxed interlocal entity is not an external procurement unit as defined
1808 in Section 63G-6a-104 .
1809 (7) (a) A taxed interlocal entity is not a participating local entity as defined in Section
1810 63A-3-401 .
1811 (b) For each fiscal year of a taxed interlocal entity, the taxed interlocal entity shall
1813 (i) the taxed interlocal entity's financial statements for and as of the end of the fiscal
1814 year and the prior fiscal year, including the taxed interlocal entity's balance sheet as of the end
1815 of the fiscal year and the prior fiscal year, and the related statements of revenues and expenses
1816 and of cash flows for the fiscal year; and
1817 (ii) the accompanying auditor's report and management's discussion and analysis with
1818 respect to the taxed interlocal entity's financial statements for and as of the end of the fiscal
1820 (c) The taxed interlocal entity shall provide the information described in Subsections
1821 (7)(b)(i) and [
1822 (i) in a manner described in Subsection 63A-3-405 (3); and
1823 (ii) within a reasonable time after the taxed interlocal entity's independent auditor
1824 delivers to the taxed interlocal entity's governing body the auditor's report with respect to the
1825 financial statements for and as of the end of the fiscal year.
1826 (d) Notwithstanding Subsections (7)(b) and (c) or a taxed interlocal entity's compliance
1827 with one or more of the requirements of Title 63A, Chapter 3, Division of Finance:
1828 (i) the taxed interlocal entity is not subject to Title 63A, Chapter 3, Division of
1829 Finance; and
1830 (ii) the information described in Subsection (7)(b)(i) or (ii) does not constitute public
1831 financial information as defined in Section 63A-3-401 .
1832 (8) (a) A taxed interlocal entity's governing body is not a governing board as defined in
1833 Section 51-2a-102 .
1834 (b) A taxed interlocal entity is not subject to the provisions of Title 51, Chapter 2a,
1835 Accounting Reports from Political Subdivisions, Interlocal Organizations, and Other Local
1836 Entities Act.
1837 Section 47. Section 11-14-301 is amended to read:
1838 11-14-301. Issuance of bonds by governing body -- Computation of indebtedness
1839 under constitutional and statutory limitations.
1840 (1) If the governing body has declared the bond proposition to have carried and no
1841 contest has been filed, or if a contest has been filed and favorably terminated, the governing
1842 body may proceed to issue the bonds voted at the election.
1843 (2) (a) It is not necessary that all of the bonds be issued at one time, but, except as
1844 otherwise provided in this Subsection (2), bonds approved by the voters may not be issued
1845 more than 10 years after the day on which the election is held.
1846 (b) The 10-year period described in Subsection (2)(a) is tolled if, at any time during the
1847 10-year period:
1848 (i) an application for a referendum petition is filed with a local clerk, in accordance
1849 with Section 20A-7-602 and Subsection 20A-7-601 [
1850 obligation law relating to the bonds; or
1851 (ii) the bonds are challenged in a court of law or an administrative proceeding in
1852 relation to:
1853 (A) the legality or validity of the bonds, or the election or proceedings authorizing the
1855 (B) the authority of the local political subdivision to issue the bonds;
1856 (C) the provisions made for the security or payment of the bonds; or
1857 (D) any other issue that materially and adversely affects the marketability of the bonds,
1858 as determined by the individual or body that holds the executive powers of the local political
1860 (c) A tolling period described in Subsection (2)(b)(i) ends on the later of the day on
1862 (i) the local clerk determines that the petition is insufficient, in accordance with
1863 Subsection 20A-7-607 (2)(c), unless an application, described in Subsection 20A-7-607 (4)(a), is
1864 made to the Supreme Court;
1865 (ii) the Supreme Court determines, under Subsection 20A-7-607 (4)(c), that the petition
1866 for the referendum is not legally sufficient; or
1867 (iii) for a referendum petition that is sufficient, the governing body declares, as
1868 provided by law, the results of the referendum election on the local obligation law.
1869 (d) A tolling period described in Subsection (2)(b)(ii) ends after:
1870 (i) there is a final settlement, a final adjudication, or another type of final resolution of
1871 all challenges described in Subsection (2)(b)(ii); and
1872 (ii) the individual or body that holds the executive powers of the local political
1873 subdivision issues a document indicating that all challenges described in Subsection (2)(b)(ii)
1874 are resolved and final.
1875 (e) If the 10-year period described in Subsection (2)(a) is tolled under this Subsection
1876 (2) and, when the tolling ends and after giving effect to the tolling, the period of time
1877 remaining to issue the bonds is less than one year, the period of time remaining to issue the
1878 bonds shall be extended to one year.
1879 (f) The tolling provisions described in this Subsection (2) apply to all bonds described
1880 in this section that were approved by voters on or after May 8, 2002.
1881 (3) (a) Bonds approved by the voters may not be issued to an amount that will cause
1882 the indebtedness of the local political subdivision to exceed that permitted by the Utah
1883 Constitution or statutes.
1884 (b) In computing the amount of indebtedness that may be incurred pursuant to
1885 constitutional and statutory limitations, the constitutionally or statutorily permitted percentage,
1886 as the case may be, shall be applied to the fair market value, as defined under Section 59-2-102 ,
1887 of the taxable property in the local political subdivision, as computed from the last applicable
1888 equalized assessment roll before the incurring of the additional indebtedness.
1889 (c) In determining the fair market value of the taxable property in the local political
1890 subdivision as provided in this section, the value of all tax equivalent property, as defined in
1891 Section 59-3-102 , shall be included as a part of the total fair market value of taxable property
1892 in the local political subdivision, as provided in Title 59, Chapter 3, Tax Equivalent Property
1894 (4) Bonds of improvement districts issued in a manner that they are payable solely
1895 from the revenues to be derived from the operation of the facilities of the district may not be
1896 included as bonded indebtedness for the purposes of the computation.
1897 (5) Where bonds are issued by a city, town, or county payable solely from revenues
1898 derived from the operation of revenue-producing facilities of the city, town, or county, or
1899 payable solely from a special fund into which are deposited excise taxes levied and collected by
1900 the city, town, or county, or excise taxes levied by the state and rebated pursuant to law to the
1901 city, town, or county, or any combination of those excise taxes, the bonds shall be included as
1902 bonded indebtedness of the city, town, or county only to the extent required by the Utah
1903 Constitution, and any bonds not so required to be included as bonded indebtedness of the city,
1904 town, or county need not be authorized at an election, except as otherwise provided by the Utah
1905 Constitution, the bonds being hereby expressly excluded from the election requirement of
1906 Section 11-14-201 .
1907 (6) A bond election is not void when the amount of bonds authorized at the election
1908 exceeded the limitation applicable to the local political subdivision at the time of holding the
1909 election, but the bonds may be issued from time to time in an amount within the applicable
1910 limitation at the time the bonds are issued.
1911 Section 48. Section 11-17-14 is amended to read:
1912 11-17-14. Uniform Commercial Code not applicable.
1913 Bonds issued under this act are exempt from the provisions of [
1914 Commercial Code[
1915 Section 49. Section 11-32-4 is amended to read:
1916 11-32-4. Assignment of rights to receive delinquent tax receivables to financing
1917 authority -- Documentation -- Agreement.
1918 (1) At any time following the date of delinquency for property in Title 59, Chapter 2,
1919 Part 13, Collection of Taxes, the governing body of any county desiring to implement the
1920 provisions of this chapter by assigning the delinquent tax receivables of the participant
1921 members to its authority shall ascertain the amount of delinquent taxes owed to the participant
1922 members within the county. After ascertaining the amount of delinquent tax receivables owed,
1923 the governing body of the county may, as agent for the other participant members, assign the
1924 rights of the participant members to receive the delinquent tax receivables, in whole or in part,
1925 as designated by the governing body of the county, to the financing authority. The assignment
1926 of rights described above shall take the form of an assignment of an account receivables. The
1927 purchase price paid by the authority may be equal to, greater than, or less than the amount of
1928 the delinquent tax receivables sold to the authority. The documentation by which the transfer
1929 of the delinquent tax receivables are made shall contain the following:
1930 (a) the tax year or years for which the delinquent taxes owing were levied;
1931 (b) the amount of taxes, interest, and penalties due to the participant members with
1932 respect to the tax years as of the date the accounts are assigned;
1933 (c) the tax identification numbers or other descriptions of the specific properties with
1934 respect to which the delinquent tax receivables are being assigned;
1935 (d) the interest rate at which the delinquent taxes subject to the assignment bear interest
1936 pursuant to Section 59-2-1331 ;
1937 (e) the discount or premium, if any, at which the account is assigned;
1938 (f) a certificate representing the transfer of the rights of the county and the other
1939 participant members to receive the amounts due and owing the county and the other participant
1940 members with respect to the delinquent tax receivables transferred; and
1941 (g) certification by the governing body of the county that all amounts received by the
1942 county with respect to the delinquent taxes, interest, and penalties assigned to the authority and
1943 owed to the county and the other participant members, for the tax years specified, upon the
1944 specified property, and the additional interest and penalties to accrue on the delinquent
1945 amounts, shall be deposited upon receipt into a special fund of the county created for this
1946 purpose and shall be used solely to pay the amounts falling due to the financing authority as
1947 specified in the assignment agreement.
1948 (2) The assignment agreement shall contain a statement to the effect that any amounts
1949 falling due under it are payable solely from a special fund into which the county shall pay the
1950 amounts collected with respect to the delinquent tax receivables pledged and shall state that
1951 under no circumstances may the county or any of the other participant members be required to
1952 use any other funds, property, or money of the county or the other participant members or to
1953 levy any tax to satisfy amounts due under the agreement.
1954 Section 50. Section 11-42-604 is amended to read:
1955 11-42-604. Notice regarding resolution or ordinance authorizing interim
1956 warrants or bond anticipation notes -- Complaint contesting warrants or notes --
1957 Prohibition against contesting warrants and notes.
1958 (1) A local entity may publish notice, as provided in Subsection (2), of a resolution or
1959 ordinance that the governing body has adopted authorizing the issuance of interim warrants or
1960 bond anticipation notes.
1961 (2) (a) If a local entity chooses to publish notice under Subsection (1)[
1963 (i) be published:
1964 (A) in a newspaper of general circulation within the local entity; and
1965 (B) as required in Section 45-1-101 ; and
1966 (ii) contain:
1967 (A) the name of the issuer of the interim warrants or bond anticipation notes;
1968 (B) the purpose of the issue;
1969 (C) the maximum principal amount that may be issued;
1970 (D) the maximum length of time over which the interim warrants or bond anticipation
1971 notes may mature;
1972 (E) the maximum interest rate, if there is a maximum rate; and
1973 (F) the times and place where a copy of the resolution or ordinance may be examined,
1974 as required under Subsection (2)(b).
1975 (b) The local entity shall allow examination of the resolution or ordinance authorizing
1976 the issuance of the interim warrants or bond anticipation notes at its office during regular
1977 business hours.
1978 (3) Any person may, within 30 days after publication of a notice under Subsection (1),
1979 file a verified, written complaint in the district court of the county in which the person resides,
1980 contesting the regularity, formality, or legality of the interim warrants or bond anticipation
1981 notes issued by the local entity or the proceedings relating to the issuance of the interim
1982 warrants or bond anticipation notes.
1983 (4) After the 30-day period under Subsection (3), no person may contest the regularity,
1984 formality, or legality of the interim warrants or bond anticipation notes issued by a local entity
1985 under the resolution or ordinance that was the subject of the notice under Subsection (1), or the
1986 proceedings relating to the issuance of the interim warrants or bond anticipation notes.
1987 Section 51. Section 13-1a-5 is amended to read:
1988 13-1a-5. Authority of director.
1989 The director has authority:
1990 (1) to make rules in accordance with Title 63G, Chapter 3, Utah Administrative
1991 Rulemaking Act, to administer the responsibilities of the division;
1992 (2) to investigate, upon complaint, the corporation and commercial code filings and
1993 compliance governed by the laws administered and enforced by the division; and
1994 (3) under the provisions of Title 63G, Chapter 4, [
1995 Act, to take administrative action against persons in violation of the division rules and the laws
1996 administered by it, including the issuance of cease and desist orders.
1997 Section 52. Section 13-22-8 is amended to read:
1998 13-22-8. Exemptions.
1999 (1) Section 13-22-5 does not apply to:
2000 (a) a solicitation that an organization conducts among its own established and bona fide
2001 membership exclusively through the voluntarily donated efforts of other members or officers of
2002 the organization;
2003 (b) a bona fide religious, ecclesiastical, or denominational organization if:
2004 (i) the solicitation is made for a church, missionary, religious, or humanitarian purpose;
2006 (ii) the organization is either:
2007 (A) a lawfully organized corporation, institution, society, church, or established
2008 physical place of worship, at which nonprofit religious services and activities are regularly
2009 conducted and carried on;
2010 (B) a bona fide religious group:
2011 (I) that does not maintain specific places of worship;
2012 (II) that is not subject to federal income tax; and
2013 (III) not required to file an IRS Form 990 under any circumstance; or
2014 (C) a separate group or corporation that is an integral part of an institution that is an
2015 income tax exempt organization under 26 U.S.C. Sec. 501(c)(3) and is not primarily supported
2016 by funds solicited outside its own membership or congregation;
2017 (c) a solicitation by a broadcast media owned or operated by an educational institution
2018 or governmental entity, or any entity organized solely for the support of that broadcast media;
2019 (d) except as provided in Subsection 13-22-21 (1), a solicitation for the relief of any
2020 person sustaining a life-threatening illness or injury specified by name at the time of
2021 solicitation if the entire amount collected without any deduction is turned over to the named
2023 (e) a political party authorized to transact its affairs within this state and any candidate
2024 and campaign worker of the party if the content and manner of any solicitation make clear that
2025 the solicitation is for the benefit of the political party or candidate;
2026 (f) a political action committee or group soliciting funds relating to issues or candidates
2027 on the ballot if the committee or group is required to file financial information with a federal or
2028 state election commission;
2029 (g) any school accredited by the state, any accredited institution of higher learning, or
2030 club or parent, teacher, or student organization within and authorized by the school in support
2031 of the operations or extracurricular activities of the school;
2032 (h) a public or higher education foundation established under Title 53A [
2033 System of Public Education, or Title 53B, State System Of Higher Education;
2034 (i) a television station, radio station, or newspaper of general circulation that donates
2035 air time or print space for no consideration as part of a cooperative solicitation effort on behalf
2036 of a charitable organization, whether or not that organization is required to register under this
2038 (j) a volunteer fire department, rescue squad, or local civil defense organization whose
2039 financial oversight is under the control of a local governmental entity;
2040 (k) any governmental unit of any state or the United States; and
2041 (l) any corporation:
2042 (i) established by an act of the United States Congress; and
2043 (ii) that is required by federal law to submit an annual report:
2044 (A) on the activities of the corporation, including an itemized report of all receipts and
2045 expenditures of the corporation; and
2046 (B) to the United States Secretary of Defense to be:
2047 (I) audited; and
2048 (II) submitted to the United States Congress.
2049 (2) Any organization claiming an exemption under this section bears the burden of
2050 proving its eligibility for, or the applicability of, the exemption claimed.
2051 (3) Each organization exempt from registration pursuant to this section that makes a
2052 material change in its legal status, officers, address, or similar changes shall file a report
2053 informing the division of its current legal status, business address, business phone, officers, and
2054 primary contact person within 30 days of the change.
2055 (4) The division may by rule:
2056 (a) require organizations exempt from registration pursuant to this section to file a
2057 notice of claim of exemption;
2058 (b) prescribe the contents of the notice of claim; and
2059 (c) require a filing fee for the notice, as determined under Section 63J-1-504 .
2060 Section 53. Section 13-23-5 is amended to read:
2061 13-23-5. Registration -- Bond, letter of credit, or certificate of deposit required --
2063 (1) (a) (i) It is unlawful for any health spa facility to operate in this state unless the
2064 facility is registered with the division.
2065 (ii) Registration is effective for one year. If the health spa facility renews its
2066 registration, the registration shall be renewed at least 30 days prior to its expiration.
2067 (iii) The division shall provide by rule for the form, content, application process, and
2068 renewal process of the registration.
2069 (b) Each health spa registering in this state shall designate a registered agent for
2070 receiving service of process. The registered agent shall be reasonably available from 8 a.m.
2071 until 5 p.m. during normal working days.
2072 (c) The division shall charge and collect a fee for registration under guidelines
2073 provided in Section 63J-1-504 .
2074 (d) If an applicant fails to file a registration application or renewal by the due date, or
2075 files an incomplete registration application or renewal, the applicant shall pay a fee of $25 for
2076 each month or part of a month after the date on which the registration application or renewal
2077 were due to be filed, in addition to the registration fee described in Subsection (1)(c).
2078 (e) A health spa registering or renewing a registration shall provide the division a copy
2079 of the liability insurance policy that:
2080 (i) covers the health spa; and
2081 (ii) is in effect at the time of the registration or renewal.
2082 (2) (a) Each health spa shall obtain and maintain:
2083 (i) a performance bond issued by a surety authorized to transact surety business in this
2085 (ii) an irrevocable letter of credit issued by a financial institution authorized to do
2086 business in this state; or
2087 (iii) a certificate of deposit.
2088 (b) The bond, letter of credit, or certificate of deposit shall be payable to the division
2089 for the benefit of any consumer who incurs damages as the result of:
2090 (i) the health spa's violation of this chapter; or
2091 (ii) the health spa's going out of business or relocating and failing to offer an alternate
2092 location within five miles.
2093 (c) (i) The division may recover from the bond, letter of credit, or certificate of deposit
2094 the costs of collecting and distributing funds under this section, up to 10% of the face value of
2095 the bond, letter of credit, or certificate of deposit but only if the consumers have fully recovered
2096 their damages first.
2097 (ii) The total liability of the issuer of the bond, letter of credit, or certificate of deposit
2098 may not exceed the amount of the bond, letter of credit, or certificate of deposit.
2099 (iii) The health spa shall maintain a bond, letter of credit, or certificate of deposit in
2100 force for one year after it notifies the division in writing that it has ceased all activities
2101 regulated by this chapter.
2102 (d) A health spa providing services at more than one location shall comply with the
2103 requirements of Subsection (2)(a) for each separate location.
2104 (e) The division may impose a fine against a health spa that fails to comply with the
2105 requirements of Subsection (2)(a) of up to $100 per day that the health spa remains out of
2106 compliance. All penalties received shall be deposited into the Consumer Protection Education
2107 and Training Fund created in Section 13-2-8 .
2108 (3) (a) The minimum principal amount of the bond, letter of credit, or certificate of
2109 credit required under Subsection (2) shall be based on the number of unexpired contracts for
2110 health spa services to which the health spa is a party, in accordance with the following
Principal Amount of
Bond, Letter of Credit,
or Certificate of Deposit
|Number of Contracts|
|2113||$15,000||500 or fewer|
|2114||35,000||501 to 1,500|
|2116||75,000||3,001 or more|
2118 Subsection (3)(a) with respect to all of the health spa's unexpired contracts for health spa
2119 services, regardless of whether a portion of those contracts satisfies the criteria in Section
2120 13-23-6 .
2121 (4) Each health spa shall obtain the bond, letter of credit, or certificate of deposit and
2122 furnish a certified copy of the bond, letter of credit, or certificate of deposit to the division prior
2123 to selling, offering or attempting to sell, soliciting the sale of, or becoming a party to any
2124 contract to provide health spa services. A health spa is considered to be in compliance with
2125 this section only if the proof provided to the division shows that the bond, letter of credit, or
2126 certificate of credit is current.
2127 (5) Each health spa shall:
2128 (a) maintain accurate records of the bond, letter of credit, or certificate of credit and of
2129 any payments made, due, or to become due to the issuer; and
2130 (b) open the records to inspection by the division at any time during normal business
2132 (6) If a health spa changes ownership, ceases operation, discontinues facilities, or
2133 relocates and fails to offer an alternate location within five miles within 30 days after its
2134 closing, the health spa is subject to the requirements of this section as if it were a new health
2135 spa coming into being at the time the health spa changed ownership. The former owner may
2136 not release, cancel, or terminate the owner's liability under any bond, letter of credit, or
2137 certificate of deposit previously filed with the division, unless:
2138 (a) the new owner has filed a new bond, letter of credit, or certificate of deposit for the
2139 benefit of consumers covered under the previous owner's bond, letter of credit, or certificate of
2140 deposit; or
2141 (b) the former owner has refunded all unearned payments to consumers.
2142 (7) If a health spa ceases operation or relocates and fails to offer an alternative location
2143 within five miles, the health spa shall provide the division with 45 days prior notice.
2144 Section 54. Section 13-26-4 is amended to read:
2145 13-26-4. Exemptions from registration.
2146 (1) In any enforcement action initiated by the division, the person claiming an
2147 exemption has the burden of proving that the person is entitled to the exemption.
2148 (2) The following are exempt from the requirements of this chapter except for the
2149 requirements of Sections 13-26-8 and 13-26-11 :
2150 (a) a broker, agent, dealer, or sales professional licensed under the licensure laws of
2151 this state, when soliciting sales within the scope of his license;
2152 (b) the solicitation of sales by:
2153 (i) a public utility that is regulated under Title 54, Public Utilities, or by an affiliate of
2154 the utility;
2155 (ii) a newspaper of general circulation;
2156 (iii) a solicitation of sales made by a broadcaster licensed by any state or federal
2158 (iv) a nonprofit organization if no part of the net earnings from the sale inures to the
2159 benefit of any member, officer, trustee, or serving board member of the organization, or
2160 individual, or family member of an individual, holding a position of authority or trust in the
2161 organization; and
2162 (v) a person who periodically publishes and delivers a catalog of the solicitor's
2163 merchandise to prospective purchasers, if the catalog:
2164 (A) contains the price and a written description or illustration of each item offered for
2166 (B) includes the business address of the solicitor;
2167 (C) includes at least 24 pages of written material and illustrations;
2168 (D) is distributed in more than one state; and
2169 (E) has an annual circulation by mailing of not less than 250,000;
2170 (c) any publicly-traded corporation registered with the Securities and Exchange
2171 Commission, or any subsidiary of the corporation;
2172 (d) the solicitation of any depository institution as defined in Section 7-1-103 , a
2173 subsidiary of a depository institution, personal property broker, securities broker, investment
2174 adviser, consumer finance lender, or insurer subject to regulation by an official agency of this
2175 state or the United States;
2176 (e) the solicitation by a person soliciting only the sale of telephone services to be
2177 provided by the person or the person's employer;
2178 (f) the solicitation of a person relating to a transaction regulated by the Commodities
2179 Futures Trading Commission, if:
2180 (i) the person is registered with or temporarily licensed by the commission to conduct
2181 that activity under the Commodity Exchange Act; and
2182 (ii) the registration or license has not expired or been suspended or revoked;
2183 (g) the solicitation of a contract for the maintenance or repair of goods previously
2184 purchased from the person:
2185 (i) who is making the solicitation; or
2186 (ii) on whose behalf the solicitation is made;
2187 (h) the solicitation of previous customers of the business on whose behalf the call is
2188 made if the person making the call:
2189 (i) does not offer any premium in conjunction with a sale or offer;
2190 (ii) is not selling an investment or an opportunity for an investment that is not
2191 registered with any state or federal authority; and
2192 (iii) is not regularly engaged in telephone sales;
2193 (i) the solicitation of a sale that is an isolated transaction and not done in the course of
2194 a pattern of repeated transactions of a like nature;
2195 (j) the solicitation of a person by a retail business establishment that has been in
2196 operation for at least five years in Utah under the same name as that used in connection with
2197 telemarketing if both of the following occur on a continuing basis:
2198 (i) products are displayed and offered for sale at the place of business, or services are
2199 offered for sale and provided at the place of business; and
2200 (ii) a majority of the seller's business involves the buyer obtaining the products or
2201 services at the seller's place of business;
2202 (k) a person primarily soliciting the sale of a magazine or periodical sold by the
2203 publisher or the publisher's agent through a written agreement, or printed or recorded material
2204 through a contractual plan, such as a book or record club, continuity plan, subscription,
2205 standing order arrangement, or supplement or series arrangement if:
2206 (i) the seller provides the consumer with a form that the consumer may use to instruct
2207 the seller not to ship the offered merchandise, and the arrangement is regulated by the Federal
2208 Trade Commission trade regulation concerning use of negative option plans by sellers in
2209 commerce; or
2210 (ii) (A) the seller periodically ships merchandise to a consumer who has consented in
2211 advance to receive the merchandise on a periodic basis; and
2212 (B) the consumer retains the right to cancel at any time and receive a full refund for the
2213 unused portion; or
2214 (l) a telephone marketing service company that provides telemarketing sales services
2215 under contract to sellers if:
2216 (i) it has been doing business regularly with customers in Utah for at least five years
2217 under the same business name and with its principal office in the same location;
2218 (ii) at least 75% of its contracts are performed on behalf of persons exempted from
2219 registration under this chapter; and
2220 (iii) neither the company nor its principals have been enjoined from doing business or
2221 subjected to criminal actions for their business activities in this or any other state.
2222 Section 55. Section 13-32a-104 is amended to read:
2223 13-32a-104. Register required to be maintained -- Contents -- Identification of
2224 items -- Prohibition against pawning or selling certain property.
2225 (1) Every pawnbroker or secondhand merchandise dealer shall keep a register of each
2226 article of property a person pawns or sells to the pawnbroker or secondhand merchandise
2227 dealer, except as provided in Subsection 13-32a-102 (23)(b). Every pawn and secondhand
2228 business owner or operator, or his employee, shall enter the following information regarding
2229 every article pawned or sold to the owner or employee:
2230 (a) the date and time of the transaction;
2231 (b) the pawn transaction ticket number, if the article is pawned;
2232 (c) the date by which the article must be redeemed;
2233 (d) the following information regarding the person who pawns or sells the article:
2234 (i) the person's name, residence address, and date of birth;
2235 (ii) the number of the driver license or other form of positive identification presented
2236 by the person, and notations of discrepancies if the person's physical description, including
2237 gender, height, weight, race, age, hair color, and eye color, does not correspond with
2238 identification provided by the person;
2239 (iii) the person's signature; and
2240 (iv) a legible fingerprint of the person's right index finger, or if the right index finger
2241 cannot be fingerprinted, a legible fingerprint of the person with a written notation identifying
2242 the fingerprint and the reason why the index finger's print was unavailable;
2243 (e) the amount loaned on or paid for the article, or the article for which it was traded;
2244 (f) the identification of the pawn or secondhand business owner or the employee,
2245 whoever is making the register entry; and
2246 (g) an accurate description of the article of property, including available identifying
2247 marks such as:
2248 (i) names, brand names, numbers, serial numbers, model numbers, color,
2249 manufacturers' names, and size;
2250 (ii) metallic composition, and any jewels, stones, or glass;
2251 (iii) any other marks of identification or indicia of ownership on the article;
2252 (iv) the weight of the article, if the payment is based on weight;
2253 (v) any other unique identifying feature;
2254 (vi) gold content, if indicated; and
2255 (vii) if multiple articles of a similar nature are delivered together in one transaction and
2256 the articles do not bear serial or model numbers and do not include precious metals or
2257 gemstones, such as musical or video recordings, books, or hand tools, the description of the
2258 articles is adequate if it includes the quantity of the articles and a description of the type of
2259 articles delivered.
2260 (2) A pawn or secondhand business may not accept any personal property if, upon
2261 inspection, it is apparent that serial numbers, model names, or identifying characteristics have
2262 been intentionally defaced on that article of property.
2263 (3) (a) A person may not pawn or sell any property to a business regulated under this
2264 chapter if the property is subject to being turned over to a law enforcement agency in
2265 accordance with Title 77, Chapter [
2266 (b) If an individual attempts to sell or pawn property to a business regulated under this
2267 chapter and the employee or owner of the business knows or has reason to know that the
2268 property is subject to Title 77, Chapter [
2269 the employee or owner shall advise the individual of the requirements of Title 77, Chapter [
2271 or sale.
2272 (4) A violation of this section is a class B misdemeanor and is also subject to civil
2273 penalties under Section 13-32a-110 .
2274 Section 56. Section 13-32a-115 is amended to read:
2275 13-32a-115. Investigation phase and victim's responsibilities.
2276 (1) If the property pawned or sold to a pawn or secondhand business is the subject of a
2277 criminal investigation and a hold has been placed on the property under Section 13-32a-109 ,
2278 the original victim shall do the following to establish a claim:
2279 (a) positively identify to law enforcement the item stolen or lost;
2280 (b) if a police report has not already been filed for the original theft or loss of property,
2281 file a police report, and provide for the law enforcement agency information surrounding the
2282 original theft or loss of property; and
2283 (c) give a sworn statement under penalty of law that:
2284 (i) claims ownership of the property;
2285 (ii) references the original theft or loss; and
2286 (iii) identifies the perpetrator if known.
2287 (2) The pawn or secondhand business shall retain possession of any property subject to
2288 a hold until a criminal prosecution is commenced relating to the property for which the hold
2289 was placed unless:
2290 (a) during the course of a criminal investigation the actual physical possession by law
2291 enforcement of an article purchased or pawned is essential for the purpose of fingerprinting the
2292 property, chemical testing of the property, or if the property contains unique or sensitive
2293 personal identifying information; or
2294 (b) an agreement between the original victim and the pawn or secondhand business to
2295 return the property is reached.
2296 (3) (a) Upon the commencement of a criminal prosecution, any article subject to a hold
2297 for investigation under this chapter may be seized by the law enforcement agency which
2298 requested the hold.
2299 (b) Subsequent disposition of the property shall be consistent with Section [
2300 24-3-103 regarding property not needed as evidence and this chapter.
2301 (c) If a conflict exists between the provisions of Section [
2302 property not needed as evidence and this chapter, this chapter takes precedence regarding
2303 property held by pawn or secondhand businesses.
2304 (4) At all times during the course of a criminal investigation and subsequent
2305 prosecution, the article subject to a law enforcement hold shall be kept secure by the pawn or
2306 secondhand business subject to the hold unless a pawned or sold article has been seized by the
2307 law enforcement agency pursuant to Section 13-32a-109.5 .
2308 Section 57. Section 13-32a-117 is amended to read:
2309 13-32a-117. Property disposition if no criminal charges filed -- Administrative
2311 (1) The original victim or the pawn or secondhand business may request an
2312 administrative property disposition hearing with the Division of Consumer Protection if:
2313 (a) more than 30 days have passed since:
2314 (i) the law enforcement agency placed a hold on the property; or
2315 (ii) the property was seized by the law enforcement agency; and
2316 (b) an agreement pursuant to Subsection 13-32a-115 (2)(b) has not been reached.
2317 (2) The original victim or the pawn or secondhand business shall provide to the
2318 Division of Consumer Protection at the time of the request for a property disposition hearing:
2319 (a) a copy of the sworn statement of the original victim taken pursuant to Section
2320 13-32a-115 and the case number assigned by the law enforcement agency; and
2321 (b) a written notice from the prosecuting agency with jurisdiction over the case
2322 involving the property that the prosecuting agency has made an initial determination under
2323 Section [
2324 needed as evidence.
2325 (3) (a) Within 30 days after receiving the request for a property disposition hearing
2326 from the original victim or the pawn or secondhand business, the Division of Consumer
2327 Protection shall schedule an adjudicative hearing in accordance with Title 63G, Chapter 4,
2328 Administrative Procedures Act, to determine ownership of the claimed property. The division
2329 shall provide written notice of the hearing to the pawn or secondhand business and the original
2331 (b) The division shall conduct the hearing to determine disposition of the claimed
2332 seized property, taking into consideration:
2333 (i) the proof of ownership of the property and compliance with Subsection
2334 13-32a-115 (1) by the original victim;
2335 (ii) the claim of ownership by the pawn or secondhand business and the potential
2336 financial loss to the business; and
2337 (iii) compliance by the pawn or secondhand business with the requirements of this
2339 (c) If the division determines that the property should be released to the pawn or
2340 secondhand business, the original victim retains a right of first refusal over the property for 15
2341 days and may purchase the property at the amount financed or paid by the pawn or secondhand
2343 (d) The party to whom the division determines the property is to be released shall
2344 maintain possession of the property for the duration of any time period regarding any
2345 applicable right of appeal.
2346 Section 58. Section 13-47-102 (Contingently Repealed) is amended to read:
2347 13-47-102 (Contingently Repealed). Definitions.
2348 As used in this chapter:
2349 (1) "Department" means the Department of Commerce.
2350 (2) "Employee" means an individual:
2351 (a) who is hired to perform services in Utah; and
2352 (b) to whom a private employer provides a federal form required for federal taxation
2353 purposes to report income paid to the individual for the services performed.
2354 (3) (a) Except as provided in Subsection (3)(b), "private employer" means a person
2355 who for federal taxation purposes is required to provide a federal form:
2356 (i) to an individual who performs services for the person in Utah; and
2357 (ii) to report income paid to the individual who performs the services.
2358 (b) "Private employer" does not mean a public employer as defined in Section
2360 (4) (a) "Status verification system" means an electronic system operated by the federal
2361 government, through which an employer may inquire to verify the federal legal working status
2362 of an individual who is a newly hired employee.
2363 (b) "Status verification system" includes:
2364 (i) the electronic verification of the work authorization program of the Illegal
2365 Immigration Reform and Immigrant Responsibility Act of 1996, 8 U.S.C. Sec. 1324a;
2366 (ii) a federal program equivalent to the program described in Subsection (4)(b)(i) that
2367 is designated by the United States Department of Homeland Security or other federal agency
2368 authorized to verify the employment eligibility status of a newly hired employee pursuant to the
2369 Immigration Reform and Control Act of 1986;
2370 (iii) the Social Security Number Verification Service or similar online verification
2371 process implemented by the United States Social Security Administration; or
2372 (iv) an independent third-party system with an equal or higher degree of reliability as
2373 the programs, systems, or processes described in Subsection (4)(b)(i), (ii), or (iii).
2374 Section 59. Section 13-47-201 (Contingently Repealed) is amended to read:
2375 13-47-201 (Contingently Repealed). Verification required for new hires.
2376 (1) A private employer who employs 15 or more employees [
2377 2010, may not hire a new employee on or after July 1, 2010, unless the private employer:
2378 (a) is registered with a status verification system to verify the federal legal working
2379 status of any new employee; and
2380 (b) uses the status verification system to verify the federal legal working status of the
2381 new employee in accordance with the requirements of the status verification system.
2382 (2) This section does not apply to a private employer of a foreign national if the foreign
2383 national holds a visa issued in response to a petition by the private employer that is classified as
2384 H-2A or H-2B.
2385 Section 60. Section 15-8-4 is amended to read:
2386 15-8-4. Inapplicability of other laws -- Exempted transactions.
2387 (1) Rental purchase agreements that comply with this chapter are not governed by the
2388 laws relating to:
2389 (a) a security interest as defined in Subsection 70A-1a-201 (2)(ii); or
2390 (b) Title 70C, Utah Consumer Credit Code, except that Sections 70C-7-102 through
2391 70C-7-104 and 70C-2-205 shall apply to lessors as defined in this chapter to the same extent as
2392 they apply to creditors under Title 70C, Utah Consumer Credit Code.
2393 (2) The chapter does not apply to the following:
2394 (a) rental purchase agreements primarily for business, commercial, or agricultural
2395 purposes, or those made with governmental agencies or instrumentalities or with organizations;
2396 (b) a lease of a safe deposit box;
2397 (c) a lease or bailment of personal property which is incidental to the lease of real
2398 property and which provides that the consumer has no option to purchase the leased property;
2400 (d) a lease of a motor vehicle, as defined in Section 41-1a-102 .
2401 Section 61. Section 15-9-103 is amended to read:
2402 15-9-103. Administration -- Rulemaking -- Service of process.
2403 (1) (a) This chapter shall be administered by the division and is subject to the
2404 requirements of Title 58, Chapter 1, Division of Occupational and Professional Licensing Act,
2405 so long as the requirements of Title 58, Chapter 1, Division of Occupational and Professional
2406 Licensing Act, are not inconsistent with the requirements of this chapter.
2407 (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2408 division may make rules necessary to implement this chapter.
2409 (2) By acting as an athlete agent in this state, a nonresident individual appoints the
2410 director of the division as the individual's agent for service of process in any civil action in this
2411 state related to the individual's acting as an athlete agent in this state.
2412 Section 62. Section 15-10-201 is amended to read:
2413 15-10-201. Notice requirement.
2414 (1) Except as provided in Subsection [
2415 automatic renewal provision unless the seller provides the consumer written notice complying
2416 with Subsection (2) that informs the consumer of the automatic renewal provision.
2417 (2) (a) For a service contract executed on or after July 1, 2011, that exceeds 12 months
2418 for a renewal period, a seller shall provide written notice of an automatic renewal provision
2419 prominently displayed on the first page of the service contract.
2420 (b) In addition to complying with Subsection (2)(a), a seller shall provide written
2421 notice required under Subsection (1) to the consumer:
2422 (i) personally;
2423 (ii) by certified mail; or
2424 (iii) prominently displayed on the first page of a monthly statement.
2425 (c) (i) A seller shall provide written notice under Subsection (2)(b):
2426 (A) no later than 30 calendar days before the last day on which the consumer may give
2427 notice of the consumer's intention to terminate the service contract; and
2428 (B) no sooner than 90 calendar days before the last day on which the consumer may
2429 give notice of the consumer's intention to terminate the service contract.
2430 (ii) A seller may not provide written notice required under Subsection (1) except:
2431 (A) as provided in Subsection (2)(a); or
2432 (B) during the time period described in Subsection (2)(c)(i).
2433 (d) Written notice required under Subsection (1) shall be:
2434 (i) written in clear and understandable language; and
2435 (ii) printed in an easy-to-read type size and style.
2436 Section 63. Section 15A-1-204 is amended to read:
2437 15A-1-204. Adoption of State Construction Code -- Amendments by commission--
2438 Approved codes -- Exemptions.
2439 (1) (a) The State Construction Code is the construction codes adopted with any
2440 modifications in accordance with this section that the state and each political subdivision of the
2441 state shall follow.
2442 (b) A person shall comply with the applicable provisions of the State Construction
2443 Code when:
2444 (i) new construction is involved; and
2445 (ii) the owner of an existing building, or the owner's agent, is voluntarily engaged in:
2446 (A) the repair, renovation, remodeling, alteration, enlargement, rehabilitation,
2447 conservation, or reconstruction of the building; or
2448 (B) changing the character or use of the building in a manner that increases the
2449 occupancy loads, other demands, or safety risks of the building.
2450 (c) On and after July 1, 2010, the State Construction Code is the State Construction
2451 Code in effect on July 1, 2010, until in accordance with this section:
2452 (i) a new State Construction Code is adopted; or
2453 (ii) one or more provisions of the State Construction Code are amended or repealed in
2454 accordance with this section.
2455 (d) A provision of the State Construction Code may be applicable:
2456 (i) to the entire state; or
2457 (ii) within a county, city, or town.
2458 (2) (a) The Legislature shall adopt a State Construction Code by enacting legislation
2459 that adopts a construction code with any modifications.
2460 (b) Legislation enacted under this Subsection (2) shall state that it takes effect on the
2461 July 1 after the day on which the legislation is enacted, unless otherwise stated in the
2463 (c) Subject to Subsection (5), a State Construction Code adopted by the Legislature is
2464 the State Construction Code until, in accordance with this section, the Legislature adopts a new
2465 State Construction Code by:
2466 (i) adopting a new State Construction Code in its entirety; or
2467 (ii) amending or repealing one or more provisions of the State Construction Code.
2468 (3) (a) The commission shall by no later than November 30 of each year recommend to
2469 the Business and Labor Interim Committee whether the Legislature should:
2470 (i) amend or repeal one or more provisions of a State Construction Code; or
2471 (ii) in a year of a regularly scheduled update of a nationally recognized code, adopt a
2472 construction code with any modifications.
2473 (b) The commission may recommend legislative action related to the State
2474 Construction Code:
2475 (i) on its own initiative;
2476 (ii) upon the recommendation of the division; or
2477 (iii) upon the receipt of a request by one of the following that the commission
2478 recommend legislative action related to the State Construction Code:
2479 (A) a local regulator;
2480 (B) a state regulator;
2481 (C) a state agency involved with the construction and design of a building;
2482 (D) the Construction Services Commission;
2483 (E) the Electrician Licensing Board;
2484 (F) the Plumbers Licensing Board; or
2485 (G) a recognized construction-related association.
2486 (4) If the Business and Labor Interim Committee decides to recommend legislative
2487 action to the Legislature, the Business and Labor Interim Committee shall prepare legislation
2488 for consideration by the Legislature in the next general session that, if passed by the
2489 Legislature, would:
2490 (a) adopt a new State Construction Code in its entirety; or
2491 (b) amend or repeal one or more provisions of the State Construction Code.
2492 (5) (a) Notwithstanding Subsection (3), the commission may, in accordance with Title
2493 63G, Chapter 3, Utah Administrative Rulemaking Act, amend the State Construction Code if
2494 the commission determines that waiting for legislative action in the next general legislative
2495 session would:
2496 (i) cause an imminent peril to the public health, safety, or welfare; or
2497 (ii) place a person in violation of federal or other state law.
2498 (b) If the commission amends the State Construction Code in accordance with this
2499 Subsection (5), the commission shall file with the division:
2500 (i) the text of the amendment to the State Construction Code; and
2501 (ii) an analysis that includes the specific reasons and justifications for the commission's
2503 (c) If the State Construction Code is amended under this Subsection (5), the division
2505 (i) publish the amendment to the State Construction Code in accordance with Section
2506 15A-1-205 ; and
2507 (ii) notify the Business and Labor Interim Committee of the amendment to the State
2508 Construction Code, including a copy of the commission's analysis described in Subsection
2510 (d) If not formally adopted by the Legislature at its next annual general session, an
2511 amendment to the State Construction Code under this Subsection (5) is repealed on the July 1
2512 immediately following the next annual general session that follows the adoption of the
2514 (6) (a) The division, in consultation with the commission, may approve, without
2515 adopting, one or more approved codes, including a specific edition of a construction code, for
2516 use by a compliance agency.
2517 (b) If the code adopted by a compliance agency is an approved code described in
2518 Subsection (6)(a), the compliance agency may:
2519 (i) adopt an ordinance requiring removal, demolition, or repair of a building;
2520 (ii) adopt, by ordinance or rule, a dangerous building code; or
2521 (iii) adopt, by ordinance or rule, a building rehabilitation code.
2522 (7) (a) Except as provided in Subsection (7)(b), a structure used solely in conjunction
2523 with agriculture use, and not for human occupancy, is exempt from the permit requirements of
2524 the State Construction Code.
2525 (b) (i) Unless exempted by a provision other than Subsection (7)(a), a plumbing,
2526 electrical, and mechanical permit may be required when that work is included in a structure
2527 described in Subsection (7)(a).
2528 (ii) Unless located in whole or in part in an agricultural protection area created under
2529 Title 17, Chapter 41, Agriculture and Industrial Protection [
2530 in Subsection (7)(a) is not exempt from a permit requirement if the structure is located on land
2531 that is:
2532 (A) within the boundaries of a city or town, and less than five contiguous acres; or
2533 (B) within a subdivision for which the county has approved a subdivision plat under
2534 Title 17, Chapter 27a, Part 6, Subdivisions, and less than two contiguous acres.
2535 Section 64. Section 15A-2-102 is amended to read:
2536 15A-2-102. Definitions.
2537 As used in this chapter and [
2538 Incorporated as Part of State Construction Code, and Chapter 4, Local Amendments
2539 Incorporated as Part of State Construction Code:
2540 (1) "HUD Code" means the Federal Manufactured Housing Construction and Safety
2541 Standards Act, as issued by the Department of Housing and Urban Development and published
2542 in 24 C.F.R. Parts 3280 and 3282 (as revised April 1, 1990).
2543 (2) "IBC" means the edition of the International Building Code adopted under Section
2544 15A-2-103 .
2545 (3) "IECC" means the edition of the International Energy Conservation Code adopted
2546 under Section 15A-2-103 .
2547 (4) "IFGC" means the edition of the International Fuel Gas Code adopted under
2548 Section 15A-2-103 .
2549 (5) "IMC" means the edition of the International Mechanical Code adopted under
2550 Section 15A-2-103 .
2551 (6) "IPC" means the edition of the International Plumbing Code adopted under Section
2552 15A-2-103 .
2553 (7) "IRC" means the edition of the International Residential Code adopted under
2554 Section 15A-2-103 .
2555 (8) "NEC" means the edition of the National Electrical Code adopted under Section
2556 15A-2-103 .
2557 (9) "UWUI" means the edition of the Utah Wildland Urban Interface Code adopted
2558 under Section 15A-2-103 .
2559 Section 65. Section 15A-2-104 is amended to read:
2560 15A-2-104. Installation standards for manufactured housing.
2561 (1) The following are the installation standards for manufactured housing for new
2562 installations or for existing manufactured or mobile homes that are subject to relocation,
2563 building alteration, remodeling, or rehabilitation in the state:
2564 (a) The manufacturer's installation instruction for the model being installed is the
2565 primary standard.
2566 (b) If the manufacturer's installation instruction for the model being installed is not
2567 available or is incomplete, the following standards apply:
2568 (i) Appendix E of the 2012 edition of the IRC, as issued by the International Code
2569 Council for installations defined in Section AE101 of Appendix E; or
2570 (ii) if an installation is beyond the scope of the 2012 edition of the IRC as defined in
2571 Section AE101 of Appendix E, the 2005 edition of the NFPA 225 Model Manufactured Home
2572 Installation Standard, issued by the National Fire Protection Association.
2573 (c) A manufacturer, dealer, or homeowner is permitted to design for unusual
2574 installation of a manufactured home not provided for in the manufacturer's standard installation
2575 instruction, Appendix E of the 2012 edition of the IRC, or the 2005 edition of the NFPA 225, if
2576 the design is approved in writing by a professional engineer or architect licensed in Utah.
2577 (d) For a mobile home built before June 15, 1976, the mobile home shall also comply
2578 with the additional installation and safety requirements specified in Chapter 3, Part 8,
2579 Installation and Safety Requirements for Mobile Homes Built Before June 15, 1976.
2580 (2) Pursuant to the HUD Code Section 604(d), a manufactured home may be installed
2581 in the state that does not meet the local snow load requirements as specified in Chapter 3, Part
2582 2, Statewide Amendments to [
2583 manufactured home shall have a protective structure built over the home that meets the IRC
2584 and the snow load requirements under Chapter 3, Part 2, Statewide Amendments to [
2585 International Residential Code.
2586 Section 66. Section 15A-3-201 is amended to read:
2587 15A-3-201. General provision.
2588 (1) The amendments in this part are adopted as amendments to the IRC to be
2589 applicable statewide.
2590 (2) The statewide amendments to the following which may be applied to detached one-
2591 and two-family dwellings and multiple single-family dwellings shall be applicable to the
2592 corresponding provisions of the IRC:
2593 (a) IBC under Part 1, Statewide Amendments to [
2594 (b) IPC under Part 3, Statewide Amendments to [
2595 (c) IMC under Part 4, Statewide Amendments to [
2597 (d) IFGC under Part 5, Statewide Amendments to [
2598 (e) NEC under Part 6, Statewide Amendments to [
2599 (f) IECC under Part 7, Statewide Amendments to [
2600 Conservation Code.
2601 Section 67. Section 15A-3-306 is amended to read:
2602 15A-3-306. Amendments to Chapter 6 of IPC.
2603 (1) IPC, Section 602.3, is deleted and replaced with the following: "602.3 Individual
2604 water supply. Where a potable public water supply is not available, individual sources of
2605 potable water supply shall be utilized provided that the source has been developed in
2606 accordance with Utah Code, Sections 73-3-1 , 73-3-3 , and 73-3-25 , as administered by the
2607 Department of Natural Resources, Division of Water Rights. In addition, the quality of the
2608 water shall be approved by the local health department having jurisdiction. The source shall
2609 supply sufficient quantity of water to comply with the requirements of this chapter."
2610 (2) IPC, Sections 602.3.1, 602.3.2, 602.3.3, 602.3.4, 602.3.5, and 602.3.5.1, are
2612 (3) A new IPC, Section 604.4.1, is added as follows: "604.4.1 Manually operated
2613 metering faucets. Self closing or manually operated metering faucets shall provide a flow of
2614 water for at least 15 seconds without the need to reactivate the faucet."
2615 (4) IPC, Section 606.5, is deleted and replaced with the following: "606.5 Water
2616 pressure booster systems. Water pressure booster systems shall be provided as required by
2617 Section 606.5.1 through 606.5.11."
2618 (5) A new IPC, Section 606.5.11, is added as follows: "606.5.11 Prohibited
2619 installation. In no case shall a booster pump be allowed that will lower the pressure in the
2620 public main to less than the minimum water pressure specified in Utah Administrative Code
2622 (6) In IPC, Section 608.1, the words "and pollution" are added after the word
2624 (7) IPC, Table 608.1, is deleted and replaced with the following:
|2628||BACKFLOW PREVENTION ASSEMBLIES:|
Double check backflow
and double check fire
Sizes 3/8" - 16"
ASSE 1015, AWWA
C510, CSA B64.5,
Double check detector
Sizes 3/8" - 16"
|High or low hazard||
Sizes 1/2" - 2"
ASSE 1020, CSA
and reduced pressure
|High or low hazard||
Sizes 3/8" - 16"
ASSE 1013, AWWA
C511, CSA B64.4,
detector fire protection
|High or low hazard||
|High or low hazard||
Sizes 1/2" - 2"
|2635||BACKFLOW PREVENTER PLUMBING DEVICES:|
valves for gravity water
closet flush tanks
|High hazard||Backsiphonage only||
ASSE 1002, CSA
Backflow preventer for
Sizes 1/4" - 3/8"
Sizes 1/4" - 3/8"
ASSE 1012, CSA
Dual check valve type
Sizes 1/4" - 1"
ASSE 1024, CSA
|High or low hazard||
Sizes 1/2" - 1"
ASSE 1052, CSA
|High or low hazard||
Sizes 1/2", 3/4", 1"
|High or low hazard||
Sizes 1/2" - 4"
ASSE 1001, CSA
Vacuum breaker wall
|High or low hazard||
Sizes 3/4", 1"
ASSE 1019, CSA
|2644||OTHER MEANS or METHODS:|
|2645||Air gap||High or low hazard||Backsiphonage only||ASME A112.1.2|
Air gap fittings for use
with plumbing fixtures,
|High or low hazard||
|2647||For SI: 1 inch = 25.4 mm|
a. Low Hazard - See Pollution (Section 202), High Hazard - See Contamination (Section
b. See Backpressure (Section 202), See Backpressure, low head (Section 202), See
Backsiphonage (Section 202)
Installation Guidelines: The above specialty devices shall be installed in accordance with
their listing and the manufacturer's instructions and the specific provisions of this chapter."
2652 replaced with a comma and the words "and pollution" are added after the word "contamination"
2653 in the first sentence.
2654 (9) In IPC, Section 608.5, the words "with the potential to create a condition of either
2655 contamination or pollution or" are added after the word "substances".
2656 (10) In IPC, Section 608.6, the following sentence is added at the end of the paragraph:
2657 "Any connection between potable water piping and sewer-connected waste shall be protected
2658 by an air gap in accordance with Section 608.13.1."
2659 (11) IPC, Section 608.7, is deleted and replaced with the following: "608.7 Stop and
2660 Waste Valves installed below grade. Combination stop-and-waste valves shall be permitted to
2661 be installed underground or below grade. Freeze proof yard hydrants that drain the riser into
2662 the ground are considered to be stop-and-waste valves and shall be permitted."
2663 (12) In IPC, Section 608.11, the following sentence is added at the end of the
2664 paragraph: "The coating and installation shall conform to NSF Standard 61 and application of
2665 the coating shall comply with the manufacturer's instructions."
2666 (13) IPC, Section 608.13.3, is deleted and replaced with the following: "608.13.3
2667 Backflow preventer with intermediate atmospheric vent. Backflow preventers with
2668 intermediate atmospheric vents shall conform to ASSE 1012 or CSA CAN/CSA-B64.3. These
2669 devices shall be permitted to be installed on residential boilers only, without chemical
2670 treatment, where subject to continuous pressure conditions. The relief opening shall discharge
2671 by air gap and shall be prevented from being submerged."
2672 (14) IPC, Section 608.13.4, is deleted.
2673 (15) IPC, Section 608.13.9, is deleted and replaced with the following: "608.13.9
2674 Chemical dispenser backflow devices. Backflow devices for chemical dispensers shall comply
2675 with Section 608.16.7."
2676 (16) IPC, Section 608.15.3, is deleted and replaced with the following: "608.15.3
2677 Protection by a backflow preventer with intermediate atmospheric vent. Connections to
2678 residential boilers only, without chemical treatment, shall be protected by a backflow preventer
2679 with an intermediate atmospheric vent."
2680 (17) IPC, Section 608.15.4, is deleted and replaced with the following: "608.15.4
2681 Protection by a vacuum breaker. Openings and outlets shall be protected by atmospheric-type
2682 or pressure-type vacuum breakers. Vacuum breakers shall not be installed under exhaust hoods
2683 or similar locations that will contain toxic fumes or vapors. Fill valves shall be set in
2684 accordance with Section 425.3.1. Atmospheric Vacuum Breakers - The critical level of the
2685 atmospheric vacuum breaker shall be set a minimum of 6 inches (152 mm) above the flood
2686 level rim of the fixture or device. Pipe-applied vacuum breakers shall be installed not less than
2687 6 inches (152 mm) above the flood level rim of the fixture, receptor, or device served. No
2688 valves shall be installed downstream of the atmospheric vacuum breaker. Pressure Vacuum
2689 Breaker - The critical level of the pressure vacuum breaker shall be set a minimum of 12 inches
2690 (304 mm) above the flood level of the fixture or device."
2691 (18) In IPC, Section 608.15.4.2, the following is added after the first sentence:
2692 "Add-on-backflow prevention devices shall be non-removable. In climates where freezing
2693 temperatures occur, a listed self-draining frost proof hose bibb with an integral backflow
2694 preventer shall be used."
2695 (19) [
2696 Connections to boilers. The potable supply to a boiler shall be protected by an air gap or a
2697 reduced pressure principle backflow preventer, complying with ASSE 1013, CSA B64.4 or
2698 AWWA C511.
2699 Exception: The potable supply to a residential boiler without chemical treatment may be
2700 equipped with a backflow preventer with an intermediate atmospheric vent complying with
2701 ASSE 1012 or CSA CAN/CSA-B64.3."
2702 (20) IPC, Section 608.16.3, is deleted and replaced with the following: "608.16.3 Heat
2703 exchangers. Heat exchangers shall be separated from potable water by double-wall
2704 construction. An air gap open to the atmosphere shall be provided between the two walls.
2706 1. Single wall heat exchangers shall be permitted when all of the following conditions are met:
2707 a. It utilizes a heat transfer medium of potable water or contains only substances which are
2708 recognized as safe by the United States Food and Drug Administration (FDA);
2709 b. The pressure of the heat transfer medium is maintained less than the normal minimum
2710 operating pressure of the potable water system; and
2711 c. The equipment is permanently labeled to indicate only additives recognized as safe by the
2712 FDA shall be used.
2713 2. Steam systems that comply with paragraph 1 above.
2714 3. Approved listed electrical drinking water coolers."
2715 (21) In IPC, Section 608.16.4.1, a new exception is added as follows: "Exception: All
2716 class 1 and 2 systems containing chemical additives consisting of strictly glycerine (C.P. or
2717 U.S.P. 96.5 percent grade) or propylene glycol shall be protected against backflow with a
2718 double check valve assembly. Such systems shall include written certification of the chemical
2719 additives at the time of original installation and service or maintenance."
2720 (22) IPC, Section 608.16.7, is deleted and replaced with the following: "608.16.7
2721 Chemical dispensers. Where chemical dispensers connect to the water distribution system, the
2722 water supply system shall be protected against backflow in accordance with Section 608.13.1,
2723 Section 608.13.2, Section 608.13.5, Section 608.13.6 or Section 608.13.8. Chemical
2724 dispensers shall connect to a separate dedicated water supply separate from any sink faucet."
2725 (23) IPC, Section 608.16.8, is deleted and replaced with the following: "608.16.8
2726 Portable cleaning equipment. Where the portable cleaning equipment connects to the water
2727 distribution system, the water supply system shall be protected against backflow in accordance
2728 with Section 608.13.1, Section 608.13.2 or Section 608.13.8."
2729 (24) A new IPC, Section 608.16.11, is added as follows: "608.16.11 Automatic and
2730 coin operated car washes. The water supply to an automatic or coin operated car wash shall be
2731 protected in accordance with Section 608.13.1 or Section 608.13.2."
2732 (25) IPC, Section 608.17, is deleted and replaced with the following: "608.17
2733 Protection of individual water supplies. See Section 602.3 for requirements."
2734 Section 68. Section 15A-4-201 is amended to read:
2735 15A-4-201. General provision.
2736 (1) The amendments in this part are adopted as amendments to the IRC to be
2737 applicable to specified jurisdiction.
2738 (2) A local amendment to the following which may be applied to detached one and two
2739 family dwellings and multiple single family dwellings shall be applicable to the corresponding
2740 provisions of the IRC for the local jurisdiction to which the local amendment has been made:
2741 (a) IBC under Part 1, Local Amendments to [
2742 (b) IPC under Part 3, Local Amendments to [
2743 (c) IMC under Part 4, Local Amendments to [
2744 (d) IFGC under Part 5, Local Amendments to [
2745 (e) NEC under Part 6, Local Amendments to [
2746 (f) IECC under Part 7, Local Amendments to [
2747 Conservation Code.
2748 Section 69. Section 15A-5-103 is amended to read:
2749 15A-5-103. Nationally recognized codes incorporated by reference.
2750 The following codes are incorporated by reference into the State Fire Code:
2751 (1) the International Fire Code, 2012 edition, excluding appendices, as issued by the
2752 International Code Council, Inc., except as amended by Part 2, Statewide Amendments and
2753 Additions to [
2754 (2) National Fire Protection Association, NFPA 96, Standard for Ventilation Control
2755 and Fire Protection of Commercial Cooking Operations, 2011 edition, except as amended by
2756 Part 3, Statewide Amendments and Additions to [
2757 Incorporated as Part of State Fire Code; and
2758 (3) National Fire Protection Association, NFPA 1403, Standard on Live Fire Training
2759 Evolutions, 2012 edition, except as amended by Part 3, Statewide Amendments and Additions
2760 to [
2761 Section 70. Section 16-6a-1011 is amended to read:
2762 16-6a-1011. Bylaw changing quorum or voting requirement for members.
2763 (1) (a) If authorized by the articles of incorporation, the members may adopt, amend, or
2764 repeal bylaws that fix a greater quorum or voting requirement for members, or voting groups of
2765 members, than is required by this chapter.
2766 (b) An action by the members under Subsection (1)(a) is subject to [
2767 6, Members, and Part 7, Member Meetings and Voting.
2768 (2) Bylaws that fix a greater quorum requirement or a greater voting requirement for
2769 members pursuant to Section 16-6a-716 may not be amended by the board of directors.
2770 Section 71. Section 16-6a-1202 is amended to read:
2771 16-6a-1202. Sale of property other than in regular course of activities.
2772 (1) (a) A nonprofit corporation may sell, lease, exchange, or otherwise dispose of all,
2773 or substantially all, of its property, with or without its good will, other than in the usual and
2774 regular course of business on the terms and conditions and for the consideration determined by
2775 the board of directors, if:
2776 (i) the board of directors proposes the transaction; and
2777 (ii) the members entitled to vote on the transaction approve the transaction.
2778 (b) A sale, lease, exchange, or other disposition of all, or substantially all, of the
2779 property of a nonprofit corporation, with or without its good will, in connection with its
2780 dissolution, other than in the usual and regular course of business, and other than pursuant to a
2781 court order, shall be subject to this section.
2782 (c) A sale, lease, exchange, or other disposition of all, or substantially all, of the
2783 property of a nonprofit corporation, with or without its good will, pursuant to a court order is
2784 not subject to this section.
2785 (2) (a) A nonprofit corporation shall comply with Subsection (2)(b) to vote or
2786 otherwise consent with respect to the sale, lease, exchange, or other disposition of all, or
2787 substantially all, of the property with or without the good will of another entity that the
2788 nonprofit corporation controls if:
2789 (i) the nonprofit corporation is entitled to vote or otherwise consent; and
2790 (ii) the property interests held by the nonprofit corporation in the other entity constitute
2791 all, or substantially all, of the property of the nonprofit corporation.
2792 (b) A nonprofit corporation may vote or otherwise consent to a transaction described in
2793 Subsection (2)(a) only if:
2794 (i) the board of the directors of the nonprofit corporation proposes the vote or consent;
2796 (ii) the members, if any are entitled to vote on the vote or consent, approve giving the
2797 vote or consent.
2798 (3) For a transaction described in Subsection (1) or a consent described in Subsection
2799 (2) to be approved by the members:
2800 (a) (i) the board of directors shall recommend the transaction or the consent to the
2801 members; or
2802 (ii) the board of directors shall:
2803 (A) determine that because of a conflict of interest or other special circumstance it
2804 should make no recommendation; and
2805 (B) communicate the basis for its determination to the members at a membership
2806 meeting with the submission of the transaction or consent; and
2807 (b) the members entitled to vote on the transaction or the consent shall approve the
2808 transaction or the consent as provided in Subsection (6).
2809 (4) The board of directors may condition the effectiveness of the transaction or the
2810 consent on any basis.
2811 (5) (a) The nonprofit corporation shall give notice, in accordance with Section
2812 16-6a-704 to each member entitled to vote on the transaction described in Subsection (1) or the
2813 consent described in Subsection (2), of the members' meeting at which the transaction or the
2814 consent will be voted upon.
2815 (b) The notice required by Subsection (1) shall:
2816 (i) state that the purpose, or one of the purposes, of the meeting is to consider:
2817 (A) in the case of action pursuant to Subsection (1), the sale, lease, exchange, or other
2818 disposition of all, or substantially all, of the property of the nonprofit corporation; or
2819 (B) in the case of action pursuant to Subsection (2), the nonprofit corporation's consent
2820 to the sale, lease, exchange, or other disposition of all, or substantially all, of the property of
2821 another entity, the property interests of which:
2822 (I) are held by the nonprofit corporation; and
2823 (II) constitute all, or substantially all, of the property of the nonprofit corporation;
2824 (ii) contain or be accompanied by a description of:
2825 (A) the transaction, in the case of action pursuant to Subsection (1); or
2826 (B) the transaction underlying the consent, in the case of action pursuant to Subsection
2827 (2); and
2828 (iii) in the case of action pursuant to Subsection (2), identify the entity whose property
2829 is the subject of the transaction.
2830 (6) The transaction described in Subsection (1) or the consent described in Subsection
2831 (2) shall be approved by the votes required by Sections 16-6a-714 and 16-6a-715 by every
2832 voting group entitled to vote on the transaction or the consent unless a greater vote is required
2834 (a) this chapter;
2835 (b) the articles of incorporation;
2836 (c) bylaws adopted by the members; or
2837 (d) the board of directors acting pursuant to Subsection (4).
2838 (7) After a transaction described in Subsection (1) or a consent described in Subsection
2839 (2) is authorized, the transaction may be abandoned or the consent withheld or revoked, subject
2840 to any contractual rights or other limitations on such abandonment, withholding, or revocation,
2841 without further action by the members.
2842 (8) A transaction that constitutes a distribution is governed by Part 13, Distributions,
2843 and not by this section.
2844 Section 72. Section 16-6a-1701 is amended to read:
2845 16-6a-1701. Application to existing domestic nonprofit corporations -- Reports of
2846 domestic and foreign nonprofit corporation.
2847 (1) Except as otherwise provided in Section 16-6a-1704 , this chapter applies to
2848 domestic nonprofit corporations as follows:
2849 (a) domestic nonprofit corporations in existence on April 30, 2001, that were
2850 incorporated under any general statute of this state providing for incorporation of nonprofit
2851 corporations, including all nonprofit corporations organized under any former provisions of
2854 (b) mutual irrigation, canal, ditch, reservoir, and water companies and water users'
2855 associations organized and existing under the laws of this state on April 30, 2001;
2856 (c) corporations organized under the provisions of Title 16, Chapter 7, Corporations
2857 Sole, for purposes of applying all provisions relating to merger or consolidation; and
2858 (d) to actions taken by the directors, officers, and members of the entities described in
2859 Subsections (1)(a), (b), and (c) after April 30, 2001.
2860 (2) Domestic nonprofit corporations to which this chapter applies, that are organized
2861 and existing under the laws of this state on April 30, 2001:
2862 (a) shall continue in existence with all the rights and privileges applicable to nonprofit
2863 corporations organized under this chapter; and
2864 (b) from April 30, 2001 shall have all the rights and privileges and shall be subject to
2865 all the remedies, restrictions, liabilities, and duties prescribed in this chapter except as
2866 otherwise specifically provided in this chapter.
2867 (3) Every existing domestic nonprofit corporation and foreign nonprofit corporation
2868 qualified to conduct affairs in this state on April 30, 2001 shall file an annual report with the
2869 division setting forth the information prescribed by Section 16-6a-1607 . The annual report
2870 shall be filed at such time as would have been required had this chapter not taken effect and
2871 shall be filed annually thereafter as required in Section 16-6a-1607 .
2872 Section 73. Section 16-6a-1702 is amended to read:
2873 16-6a-1702. Application to foreign nonprofit corporations.
2874 (1) A foreign nonprofit corporation authorized to conduct affairs in this state on April
2875 30, 2001, is subject to this chapter, but is not required to obtain a new certificate of authority to
2876 conduct affairs under this chapter.
2877 (2) A foreign nonprofit corporation that is qualified to do business in this state under
2878 the provisions of [
2879 Chapter 28, shall be authorized to transact business in this state subject to all of the limitations,
2880 restrictions, liabilities, and duties prescribed in this chapter.
2881 (3) This chapter shall apply to all foreign nonprofit corporations sole qualified to do
2882 business in this state with respect to mergers and consolidations.
2883 Section 74. Section 16-10a-402 is amended to read:
2884 16-10a-402. Reserved name.
2885 (1) Any person may apply for the reservation of a name by delivering to the division
2886 for filing an application setting forth the name and address of the applicant and the name
2887 proposed to be reserved. If the division finds that the name applied for would be available for
2888 use as a corporate name under Section 16-10a-401 , the division shall reserve the name for the
2889 applicant for a 120-day period. Any person which has in effect a reservation of a name
2890 permitted by this Subsection may renew the reservation by delivering to the division for filing
2891 prior to expiration of the reservation a renewal application for reservation, which complies with
2892 the requirements of this Subsection (1). When filed, the renewal application for reservation
2893 renews the reservation for a period of 120 days from the date of filing.
2894 (2) The applicant for a reserved name may transfer the reservation to another person by
2895 delivering to the division a notice of the transfer signed by the applicant for which the name
2896 was reserved and specifying the reserved name, the name of the holder of the name, and the
2897 name and address of the transferee.
2898 (3) A name reservation does not authorize the applicant to use the name until:
2899 (a) the name is registered as a trade name under Section 42-2-5 ;
2900 (b) articles of incorporation which bear the name are filed with the division; or
2901 (c) an application for authority to transact business in this state under the name has
2902 been filed with the division pursuant to Part 15 [
2903 Corporation to Transact Business.
2904 Section 75. Section 16-10a-901 is amended to read:
2905 16-10a-901. Definitions.
2906 As used in Part 9, Indemnification:
2907 (1) "Corporation" includes any domestic or foreign entity that is a predecessor of a
2908 corporation by reason of a merger or other transaction in which the predecessor's existence
2909 ceased upon consummation of the transaction.
2910 (2) "Director" means an individual who is or was a director of a corporation or an
2911 individual who, while a director of a corporation, is or was serving at the corporation's request
2912 as a director, officer, partner, trustee, employee, fiduciary, or agent of another domestic or
2913 foreign corporation or other person or of an employee benefit plan. A director is considered to
2914 be serving an employee benefit plan at the corporation's request if his duties to the corporation
2915 also impose duties on, or otherwise involve services by, him to the plan or to participants in or
2916 beneficiaries of the plan. "Director" includes, unless the context requires otherwise, the estate
2917 or personal representative of a director.
2918 (3) "Expenses" include counsel fees.
2919 (4) "Liability" means the obligation incurred with respect to a proceeding to pay a
2920 judgment, settlement, penalty, fine (including an excise tax assessed with respect to an
2921 employee benefit plan), or reasonable expenses.
2922 (5) "Officer," "employee," "fiduciary," and "agent" include any person who, while
2923 serving the indicated relationship to the corporation, is or was serving at the corporation's
2924 request as a director, officer, partner, trustee, employee, fiduciary, or agent of another domestic
2925 or foreign corporation or other person or of an employee benefit plan. An officer, employee,
2926 fiduciary, or agent is considered to be serving an employee benefit plan at the corporation's
2927 request if that person's duties to the corporation also impose duties on, or otherwise involve