1     
TRANSPORTATION FUNDING REVISIONS

2     
2017 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Scott D. Sandall

5     
Senate Sponsor: Kevin T. Van Tassell

6     

7     LONG TITLE
8     General Description:
9          This bill modifies the Transportation Code by amending provisions relating to the Local
10     Highway and Transportation Corridor Preservation Fund.
11     Highlighted Provisions:
12          This bill:
13          ▸     authorizes money in the Local Highway and Transportation Corridor Preservation
14     Fund to be used for construction, maintenance, and operation of class B and class C
15     roads or survey monument restoration or repair with limitations in a county of the
16     third, fourth, fifth, or sixth class; and
17          ▸     makes technical and conforming changes.
18     Money Appropriated in this Bill:
19          None
20     Other Special Clauses:
21          None
22     Utah Code Sections Affected:
23     AMENDS:
24          41-1a-1222, as last amended by Laws of Utah 2015, Chapter 421
25          59-12-2217, as last amended by Laws of Utah 2015, Chapter 421
26          59-12-2218, as last amended by Laws of Utah 2016, Chapter 348
27          72-2-117.5, as last amended by Laws of Utah 2015, Chapters 395 and 410
28     

29     Be it enacted by the Legislature of the state of Utah:

30          Section 1. Section 41-1a-1222 is amended to read:
31          41-1a-1222. Local option highway construction and transportation corridor
32     preservation fee -- Exemptions -- Deposit -- Transfer -- County ordinance -- Notice.
33          (1) (a) (i) Except as provided in Subsection (1)(a)(ii), a county legislative body may
34     impose a local option highway construction and transportation corridor preservation fee of up
35     to $10 on each motor vehicle registration within the county.
36          (ii) A county legislative body may impose a local option highway construction and
37     transportation corridor preservation fee of up to $7.75 on each motor vehicle registration for a
38     six-month registration period under Section 41-1a-215.5 within the county.
39          (iii) A fee imposed under Subsection (1)(a)(i) or (ii) shall be set in whole dollar
40     increments.
41          (b) If imposed under Subsection (1)(a), at the time application is made for registration
42     or renewal of registration of a motor vehicle under this chapter, the applicant shall pay the local
43     option highway construction and transportation corridor preservation fee established by the
44     county legislative body.
45          (c) The following are exempt from the fee required under Subsection (1)(a):
46          (i) a motor vehicle that is exempt from the registration fee under Section 41-1a-1209 or
47     Subsection 41-1a-419(3);
48          (ii) a commercial vehicle with an apportioned registration under Section 41-1a-301;
49     and
50          (iii) a motor vehicle with a Purple Heart special group license plate issued in
51     accordance with Section 41-1a-421.
52          (2) (a) Except as provided in Subsection (2)(b), the revenue generated under this
53     section shall be:
54          (i) deposited in the Local Highway and Transportation Corridor Preservation Fund
55     created in Section 72-2-117.5;
56          (ii) credited to the county from which it is generated; and
57          (iii) used and distributed in accordance with Section 72-2-117.5.

58          (b) The revenue generated by a fee imposed under this section in a county of the first
59     class shall be deposited or transferred as follows:
60          (i) 50% of the revenue shall be:
61          (A) deposited in the County of the First Class Highway Projects Fund created in
62     Section 72-2-121; and
63          (B) used in accordance with Section 72-2-121;
64          (ii) 20% of the revenue shall be:
65          (A) transferred to the legislative body of a city of the first class:
66          (I) located in a county of the first class; and
67          (II) that has:
68          (Aa) an international airport within its boundaries; and
69          (Bb) a United States customs office on the premises of the international airport
70     described in Subsection (2)(b)(ii)(A)(II)(Aa); and
71          (B) used by the city described in Subsection (2)(b)(ii)(A) for highway construction,
72     reconstruction, or maintenance projects; and
73          (iii) 30% of the revenue shall be deposited, credited, and used as provided in
74     Subsection (2)(a).
75          (3) To impose or change the amount of a fee under this section, the county legislative
76     body shall pass an ordinance:
77          (a) approving the fee;
78          (b) setting the amount of the fee; and
79          (c) providing an effective date for the fee as provided in Subsection (4).
80          (4) (a) If a county legislative body enacts, changes, or repeals a fee under this section,
81     the enactment, change, or repeal shall take effect on July 1 if the commission receives notice
82     meeting the requirements of Subsection (4)(b) from the county prior to April 1.
83          (b) The notice described in Subsection (4)(a) shall:
84          (i) state that the county will enact, change, or repeal a fee under this part;
85          (ii) include a copy of the ordinance imposing the fee; and

86          (iii) if the county enacts or changes the fee under this section, state the amount of the
87     fee.
88          Section 2. Section 59-12-2217 is amended to read:
89          59-12-2217. County option sales and use tax for transportation -- Base -- Rate --
90     Written prioritization process -- Approval by county legislative body.
91          (1) Subject to the other provisions of this part, a county legislative body may impose a
92     sales and use tax of up to .25% on the transactions described in Subsection 59-12-103(1)
93     within the county, including the cities and towns within the county.
94          (2) Subject to Subsections (3) through (8) and Section 59-12-2207, the revenues
95     collected from a sales and use tax under this section may only be expended for:
96          (a) a project or service:
97          (i) relating to a regionally significant transportation facility for the portion of the
98     project or service that is performed within the county;
99          (ii) for new capacity or congestion mitigation if the project or service is performed
100     within a county:
101          (A) of the first or second class; or
102          (B) if that county is part of an area metropolitan planning organization; and
103          (iii) that is on a priority list:
104          (A) created by the county's council of governments in accordance with Subsection (7);
105     and
106          (B) approved by the county legislative body in accordance with Subsection (7);
107          (b) corridor preservation for a project or service described in Subsection (2)(a) as
108     provided in Subsection (8); or
109          (c) debt service or bond issuance costs related to a project or service described in
110     Subsection (2)(a)(i) or (ii).
111          (3) If a project or service described in Subsection (2) is for:
112          (a) a principal arterial highway or a minor arterial highway in a county of the first or
113     second class or a collector road in a county of the second class, that project or service shall be

114     part of the:
115          (i) county and municipal master plan; and
116          (ii) (A) statewide long-range plan; or
117          (B) regional transportation plan of the area metropolitan planning organization if a
118     metropolitan planning organization exists for the area; or
119          (b) a fixed guideway or an airport, that project or service shall be part of the regional
120     transportation plan of the area metropolitan planning organization if a metropolitan planning
121     organization exists for the area.
122          (4) In a county of the first or second class, a regionally significant transportation
123     facility project or service described in Subsection (2)(a)(i) shall have a funded year priority
124     designation on a Statewide Transportation Improvement Program and Transportation
125     Improvement Program if the project or service described in Subsection (2)(a)(i) is:
126          (a) a principal arterial highway;
127          (b) a minor arterial highway;
128          (c) a collector road in a county of the second class; or
129          (d) a major collector highway in a rural area.
130          (5) Of the revenues collected from a sales and use tax imposed under this section
131     within a county of the first or second class, 25% or more shall be expended for the purpose
132     described in Subsection (2)(b).
133          (6) (a) As provided in this Subsection (6), a council of governments shall:
134          (i) develop a written prioritization process for the prioritization of projects to be funded
135     by revenues collected from a sales and use tax under this section;
136          (ii) create a priority list of regionally significant transportation facility projects or
137     services described in Subsection (2)(a)(i) in accordance with Subsection (7); and
138          (iii) present the priority list to the county legislative body for approval in accordance
139     with Subsection (7).
140          (b) The written prioritization process described in Subsection (6)(a)(i) shall include:
141          (i) a definition of the type of projects to which the written prioritization process

142     applies;
143          (ii) subject to Subsection (6)(c), the specification of a weighted criteria system that the
144     council of governments will use to rank proposed projects and how that weighted criteria
145     system will be used to determine which proposed projects will be prioritized;
146          (iii) the specification of data that is necessary to apply the weighted criteria system;
147          (iv) application procedures for a project to be considered for prioritization by the
148     council of governments; and
149          (v) any other provision the council of governments considers appropriate.
150          (c) The weighted criteria system described in Subsection (6)(b)(ii) shall include the
151     following:
152          (i) the cost effectiveness of a project;
153          (ii) the degree to which a project will mitigate regional congestion;
154          (iii) the compliance requirements of applicable federal laws or regulations;
155          (iv) the economic impact of a project;
156          (v) the degree to which a project will require tax revenues to fund maintenance and
157     operation expenses; and
158          (vi) any other provision the council of governments considers appropriate.
159          (d) A council of governments of a county of the first or second class shall submit the
160     written prioritization process described in Subsection (6)(a)(i) to the Executive Appropriations
161     Committee for approval prior to taking final action on:
162          (i) the written prioritization process; or
163          (ii) any proposed amendment to the written prioritization process.
164          (7) (a) A council of governments shall use the weighted criteria system adopted in the
165     written prioritization process developed in accordance with Subsection (6) to create a priority
166     list of regionally significant transportation facility projects or services for which revenues
167     collected from a sales and use tax under this section may be expended.
168          (b) Before a council of governments may finalize a priority list or the funding level of a
169     project, the council of governments shall conduct a public meeting on:

170          (i) the written prioritization process; and
171          (ii) the merits of the projects that are prioritized as part of the written prioritization
172     process.
173          (c) A council of governments shall make the weighted criteria system ranking for each
174     project prioritized as part of the written prioritization process publicly available before the
175     public meeting required by Subsection (7)(b) is held.
176          (d) If a council of governments prioritizes a project over another project with a higher
177     rank under the weighted criteria system, the council of governments shall:
178          (i) identify the reasons for prioritizing the project over another project with a higher
179     rank under the weighted criteria system at the public meeting required by Subsection (7)(b);
180     and
181          (ii) make the reasons described in Subsection (7)(d)(i) publicly available.
182          (e) Subject to Subsections (7)(f) and (g), after a council of governments finalizes a
183     priority list in accordance with this Subsection (7), the council of governments shall:
184          (i) submit the priority list to the county legislative body for approval; and
185          (ii) obtain approval of the priority list from a majority of the members of the county
186     legislative body.
187          (f) A council of governments may only submit one priority list per calendar year to the
188     county legislative body.
189          (g) A county legislative body may only consider and approve one priority list submitted
190     under Subsection (7)(e) per calendar year.
191          (8) (a) Except as provided in Subsection (8)(b), revenues collected from a sales and use
192     tax under this section that a county allocates for a purpose described in Subsection (2)(b) shall
193     be:
194          (i) deposited in or transferred to the Local Highway and Transportation Corridor
195     Preservation Fund created by Section 72-2-117.5; and
196          (ii) expended as provided in Section 72-2-117.5.
197          (b) In a county of the first class, revenues collected from a sales and use tax under this

198     section that a county allocates for a purpose described in Subsection (2)(b) shall be:
199          (i) deposited in or transferred to the County of the First Class Highway Projects Fund
200     created by Section 72-2-121; and
201          (ii) expended as provided in Section 72-2-121.
202          Section 3. Section 59-12-2218 is amended to read:
203          59-12-2218. County, city, or town option sales and use tax for airports, highways,
204     and systems for public transit -- Base -- Rate -- Administration of sales and use tax --
205     Voter approval exception.
206          (1) Subject to the other provisions of this part, the following may impose a sales and
207     use tax under this section:
208          (a) if, on April 1, 2009, a county legislative body of a county of the second class
209     imposes a sales and use tax under this section, the county legislative body of the county of the
210     second class may impose the sales and use tax on the transactions:
211          (i) described in Subsection 59-12-103(1); and
212          (ii) within the county, including the cities and towns within the county; or
213          (b) if, on April 1, 2009, a county legislative body of a county of the second class does
214     not impose a sales and use tax under this section:
215          (i) a city legislative body of a city within the county of the second class may impose a
216     sales and use tax under this section on the transactions described in Subsection 59-12-103(1)
217     within that city;
218          (ii) a town legislative body of a town within the county of the second class may impose
219     a sales and use tax under this section on the transactions described in Subsection 59-12-103(1)
220     within that town; and
221          (iii) the county legislative body of the county of the second class may impose a sales
222     and use tax on the transactions described in Subsection 59-12-103(1):
223          (A) within the county, including the cities and towns within the county, if on the date
224     the county legislative body provides the notice described in Section 59-12-2209 to the
225     commission stating that the county will enact a sales and use tax under this section, no city or

226     town within that county imposes a sales and use tax under this section or has provided the
227     notice described in Section 59-12-2209 to the commission stating that the city or town will
228     enact a sales and use tax under this section; or
229          (B) within the county, except for within a city or town within that county, if, on the
230     date the county legislative body provides the notice described in Section 59-12-2209 to the
231     commission stating that the county will enact a sales and use tax under this section, that city or
232     town imposes a sales and use tax under this section or has provided the notice described in
233     Section 59-12-2209 to the commission stating that the city or town will enact a sales and use
234     tax under this section.
235          (2) For purposes of Subsection (1) and subject to the other provisions of this section, a
236     county, city, or town legislative body that imposes a sales and use tax under this section may
237     impose the tax at a rate of:
238          (a) .10%; or
239          (b) .25%.
240          (3) A sales and use tax imposed at a rate described in Subsection (2)(a) shall be
241     expended as determined by the county, city, or town legislative body as follows:
242          (a) deposited as provided in Subsection (9)(b) into the County of the Second Class
243     State Highway Projects Fund created by Section 72-2-121.2 and expended as provided in
244     Section 72-2-121.2;
245          (b) expended for a project or service relating to an airport facility for the portion of the
246     project or service that is performed within the county, city, or town within which the tax is
247     imposed:
248          (i) for a county legislative body that imposes the sales and use tax, if that airport
249     facility is part of the regional transportation plan of the area metropolitan planning organization
250     if a metropolitan planning organization exists for the area; or
251          (ii) for a city or town legislative body that imposes the sales and use tax, if:
252          (A) that city or town owns or operates the airport facility; and
253          (B) an airline is headquartered in that city or town; or

254          (c) deposited or expended for a combination of Subsections (3)(a) and (b).
255          (4) Subject to Subsections (5) through (7), a sales and use tax imposed at a rate
256     described in Subsection (2)(b) shall be expended as determined by the county, city, or town
257     legislative body as follows:
258          (a) deposited as provided in Subsection (9)(b) into the County of the Second Class
259     State Highway Projects Fund created by Section 72-2-121.2 and expended as provided in
260     Section 72-2-121.2;
261          (b) expended for:
262          (i) a state highway designated under Title 72, Chapter 4, Part 1, State Highways;
263          (ii) a local highway that is a principal arterial highway, minor arterial highway, major
264     collector highway, or minor collector road; or
265          (iii) a combination of Subsections (4)(b)(i) and (ii);
266          (c) expended for a project or service relating to a system for public transit for the
267     portion of the project or service that is performed within the county, city, or town within which
268     the sales and use tax is imposed;
269          (d) expended for a project or service relating to an airport facility for the portion of the
270     project or service that is performed within the county, city, or town within which the sales and
271     use tax is imposed:
272          (i) for a county legislative body that imposes the sales and use tax, if that airport
273     facility is part of the regional transportation plan of the area metropolitan planning organization
274     if a metropolitan planning organization exists for the area; or
275          (ii) for a city or town legislative body that imposes the sales and use tax, if:
276          (A) that city or town owns or operates the airport facility; and
277          (B) an airline is headquartered in that city or town;
278          (e) expended for:
279          (i) a class B road, as defined in Section 72-3-103;
280          (ii) a class C road, as defined in Section 72-3-104; or
281          (iii) a combination of Subsections (4)(e)(i) and (ii);

282          (f) expended for traffic and pedestrian safety, including:
283          (i) for a class B road, as defined in Section 72-3-103, or class C road, as defined in
284     Section 72-3-104, for:
285          (A) a sidewalk;
286          (B) curb and gutter;
287          (C) a safety feature;
288          (D) a traffic sign;
289          (E) a traffic signal;
290          (F) street lighting; or
291          (G) a combination of Subsections (4)(f)(i)(A) through (F);
292          (ii) the construction of an active transportation facility that:
293          (A) is for nonmotorized vehicles and multimodal transportation; and
294          (B) connects an origin with a destination; or
295          (iii) a combination of Subsections (4)(f)(i) and (ii); or
296          (g) deposited or expended for a combination of Subsections (4)(a) through (f).
297          (5) A county, city, or town legislative body may not expend revenue collected within a
298     county, city, or town from a tax under this section for a purpose described in Subsections (4)(b)
299     through (f) unless the purpose is recommended by:
300          (a) for a county that is part of a metropolitan planning organization, the metropolitan
301     planning organization of which the county is a part; or
302          (b) for a county that is not part of a metropolitan planning organization, the council of
303     governments of which the county is a part.
304          (6) (a) (i) Except as provided in Subsection (6)(b), a county, city, or town that imposes
305     a tax described in Subsection (2)(b) shall deposit the revenue collected from a tax rate of .05%
306     as provided in Subsection (9)(b)(i) into the Local Highway and Transportation Corridor
307     Preservation Fund created by Section 72-2-117.5.
308          (ii) Revenue deposited in accordance with Subsection (6)(a)(i) shall be expended and
309     distributed in accordance with Section 72-2-117.5.

310          (b) A county, city, or town is not required to make the deposit required by Subsection
311     (6)(a)(i) if the county, city, or town:
312          (i) imposed a tax described in Subsection (2)(b) on July 1, 2010; or
313          (ii) has continuously imposed a tax described in Subsection (2)(b):
314          (A) beginning after July 1, 2010; and
315          (B) for a five-year period.
316          (7) (a) Subject to the other provisions of this Subsection (7), a city or town within
317     which a sales and use tax is imposed at the tax rate described in Subsection (2)(b) may:
318          (i) expend the revenues in accordance with Subsection (4); or
319          (ii) expend the revenues in accordance with Subsections (7)(b) through (d) if:
320          (A) that city or town owns or operates an airport facility; and
321          (B) an airline is headquartered in that city or town.
322          (b) (i) A city or town legislative body of a city or town within which a sales and use tax
323     is imposed at the tax rate described in Subsection (2)(b) may expend the revenues collected
324     from a tax rate of greater than .10% but not to exceed the revenues collected from a tax rate of
325     .25% for a purpose described in Subsection (7)(b)(ii) if:
326          (A) that city or town owns or operates an airport facility; and
327          (B) an airline is headquartered in that city or town.
328          (ii) A city or town described in Subsection (7)(b)(i) may expend the revenues collected
329     from a tax rate of greater than .10% but not to exceed the revenues collected from a tax rate of
330     .25% for:
331          (A) a project or service relating to the airport facility; and
332          (B) the portion of the project or service that is performed within the city or town
333     imposing the sales and use tax.
334          (c) If a city or town legislative body described in Subsection (7)(b)(i) determines to
335     expend the revenues collected from a tax rate of greater than .10% but not to exceed the
336     revenues collected from a tax rate of .25% for a project or service relating to an airport facility
337     as allowed by Subsection (7)(b), any remaining revenue that is collected from the sales and use

338     tax imposed at the tax rate described in Subsection (2)(b) that is not expended for the project or
339     service relating to an airport facility as allowed by Subsection (7)(b) shall be expended as
340     follows:
341          (i) 75% of the remaining revenues shall be deposited as provided in Subsection (9)(c)
342     into the County of the Second Class State Highway Projects Fund created by Section
343     72-2-121.2 and expended as provided in Section 72-2-121.2; and
344          (ii) 25% of the remaining revenues shall be deposited as provided in Subsection (9)(c)
345     into the Local Highway and Transportation Corridor Preservation Fund created by Section
346     72-2-117.5 and expended and distributed in accordance with Section 72-2-117.5.
347          (d) A city or town legislative body that expends the revenues collected from a sales and
348     use tax imposed at the tax rate described in Subsection (2)(b) in accordance with Subsections
349     (7)(b) and (c):
350          (i) shall, on or before the date the city or town legislative body provides the notice
351     described in Section 59-12-2209 to the commission stating that the city or town will enact a
352     sales and use tax under this section:
353          (A) determine the tax rate, the percentage of which is greater than .10% but does not
354     exceed .25%, the collections from which the city or town legislative body will expend for a
355     project or service relating to an airport facility as allowed by Subsection (7)(b); and
356          (B) notify the commission in writing of the tax rate the city or town legislative body
357     determines in accordance with Subsection (7)(d)(i)(A);
358          (ii) shall, on or before the April 1 immediately following the date the city or town
359     legislative body provides the notice described in Subsection (7)(d)(i) to the commission:
360          (A) determine the tax rate, the percentage of which is greater than .10% but does not
361     exceed .25%, the collections from which the city or town legislative body will expend for a
362     project or service relating to an airport facility as allowed by Subsection (7)(b); and
363          (B) notify the commission in writing of the tax rate the city or town legislative body
364     determines in accordance with Subsection (7)(d)(ii)(A);
365          (iii) shall, on or before April 1 of each year after the April 1 described in Subsection

366     (7)(d)(ii):
367          (A) determine the tax rate, the percentage of which is greater than .10% but does not
368     exceed .25%, the collections from which the city or town legislative body will expend for a
369     project or service relating to an airport facility as allowed by Subsection (7)(b); and
370          (B) notify the commission in writing of the tax rate the city or town legislative body
371     determines in accordance with Subsection (7)(d)(iii)(A); and
372          (iv) may not change the tax rate the city or town legislative body determines in
373     accordance with Subsections (7)(d)(i) through (iii) more frequently than as prescribed by
374     Subsections (7)(d)(i) through (iii).
375          (8) Before a city or town legislative body may impose a sales and use tax under this
376     section, the city or town legislative body shall provide a copy of the notice described in Section
377     59-12-2209 that the city or town legislative body provides to the commission:
378          (a) to the county legislative body within which the city or town is located; and
379          (b) at the same time as the city or town legislative body provides the notice to the
380     commission.
381          (9) (a) Subject to Subsections (9)(b) through (e) and Section 59-12-2207, the
382     commission shall transmit revenues collected within a county, city, or town from a tax under
383     this part that will be expended for a purpose described in Subsection (3)(b) or Subsections
384     (4)(b) through (f) to the county, city, or town legislative body in accordance with Section
385     59-12-2206.
386          (b) Except as provided in Subsection (9)(c) and subject to Section 59-12-2207, the
387     commission shall deposit revenues collected within a county, city, or town from a sales and use
388     tax under this section that:
389          (i) are required to be expended for a purpose described in Subsection (6)(a) into the
390     Local Transportation Corridor Preservation Fund created by Section 72-2-117.5; or
391          (ii) a county, city, or town legislative body determines to expend for a purpose
392     described in Subsection (3)(a) or (4)(a) into the County of the Second Class State Highway
393     Projects Fund created by Section 72-2-121.2 if the county, city, or town legislative body

394     provides written notice to the commission requesting the deposit.
395          (c) Subject to Subsection (9)(d) or (e), if a city or town legislative body provides notice
396     to the commission in accordance with Subsection (7)(d), the commission shall:
397          (i) transmit the revenues collected from the tax rate stated on the notice to the city or
398     town legislative body monthly by electronic funds transfer; and
399          (ii) deposit any remaining revenues described in Subsection (7)(c) in accordance with
400     Subsection (7)(c).
401          (d) (i) If a city or town legislative body provides the notice described in Subsection
402     (7)(d)(i) to the commission, the commission shall transmit or deposit the revenues collected
403     from the sales and use tax:
404          (A) in accordance with Subsection (9)(c);
405          (B) beginning on the date the city or town legislative body enacts the sales and use tax;
406     and
407          (C) ending on the earlier of the June 30 immediately following the date the city or town
408     legislative body provides the notice described in Subsection (7)(d)(ii) to the commission or the
409     date the city or town legislative body repeals the sales and use tax.
410          (ii) If a city or town legislative body provides the notice described in Subsection
411     (7)(d)(ii) or (iii) to the commission, the commission shall transmit or deposit the revenues
412     collected from the sales and use tax:
413          (A) in accordance with Subsection (9)(c);
414          (B) beginning on the July 1 immediately following the date the city or town legislative
415     body provides the notice described in Subsection (7)(d)(ii) or (iii) to the commission; and
416          (C) ending on the earlier of the June 30 of the year after the date the city or town
417     legislative body provides the notice described in Subsection (7)(d)(ii) or (iii) to the commission
418     or the date the city or town legislative body repeals the sales and use tax.
419          (e) (i) If a city or town legislative body that is required to provide the notice described
420     in Subsection (7)(d)(i) does not provide the notice described in Subsection (7)(d)(i) to the
421     commission on or before the date required by Subsection (7)(d) for providing the notice, the

422     commission shall transmit, transfer, or deposit the revenues collected from the sales and use
423     tax within the city or town in accordance with Subsections (9)(a) and (b).
424          (ii) If a city or town legislative body that is required to provide the notice described in
425     Subsection (7)(d)(ii) or (iii) does not provide the notice described in Subsection (7)(d)(ii) or
426     (iii) to the commission on or before the date required by Subsection (7)(d) for providing the
427     notice, the commission shall transmit or deposit the revenues collected from the sales and use
428     tax within the city or town in accordance with:
429          (A) Subsection (9)(c); and
430          (B) the most recent notice the commission received from the city or town legislative
431     body under Subsection (7)(d).
432          Section 4. Section 72-2-117.5 is amended to read:
433          72-2-117.5. Definitions -- Local Highway and Transportation Corridor
434     Preservation Fund -- Disposition of fund money.
435          (1) As used in this section:
436          (a) "Council of governments" means a decision-making body in each county composed
437     of the county governing body and the mayors of each municipality in the county.
438          (b) "Metropolitan planning organization" has the same meaning as defined in Section
439     72-1-208.5.
440          (2) There is created the Local Highway and Transportation Corridor Preservation Fund
441     within the Transportation Fund.
442          (3) The fund shall be funded from the following sources:
443          (a) a local option highway construction and transportation corridor preservation fee
444     imposed under Section 41-1a-1222;
445          (b) appropriations made to the fund by the Legislature;
446          (c) contributions from other public and private sources for deposit into the fund;
447          (d) all money collected from rents and sales of real property acquired with fund money;
448          (e) proceeds from general obligation bonds, revenue bonds, or other obligations issued
449     as authorized by Title 63B, Bonds;

450          (f) the portion of the sales and use tax described in Subsection 59-12-2217(2)(b) and
451     required by Subsection 59-12-2217(8)(a) to be deposited into the fund; and
452          (g) sales and use tax revenues deposited into the fund in accordance with Section
453     59-12-2218.
454          (4) (a) The fund shall earn interest.
455          (b) All interest earned on fund money shall be deposited into the fund.
456          (c) The State Tax Commission shall allocate the revenues:
457          (i) provided under Subsection (3)(a) to each county imposing a local option highway
458     construction and transportation corridor preservation fee under Section 41-1a-1222;
459          (ii) provided under Subsection 59-12-2217(2)(b) to each county imposing a county
460     option sales and use tax for transportation; and
461          (iii) provided under Subsection (3)(g) to each county of the second class or city or town
462     within a county of the second class that imposes the sales and use tax authorized by Section
463     59-12-2218.
464          (d) The department shall distribute the funds allocated to each county, city, or town
465     under Subsection (4)(c) to each county, city, or town.
466          (e) The money allocated and distributed under this Subsection (4):
467          (i) shall be used for the purposes provided in this section for each county, city, or town;
468          (ii) is allocated to each county, city, or town as provided in this section with the
469     condition that the state will not be charged for any asset purchased with the money allocated
470     and distributed under this Subsection (4), unless there is a written agreement in place with the
471     department prior to the purchase of the asset stipulating a reimbursement by the state to the
472     county, city, or town of no more than the original purchase price paid by the county, city, or
473     town; and
474          (iii) is considered a local matching contribution for the purposes described under
475     Section 72-2-123 if used on a state highway.
476          (f) Administrative costs of the department to implement this section shall be paid from
477     the fund.

478          (5) (a) A highway authority may acquire real property or any interests in real property
479     for state, county, and municipal highway corridors subject to:
480          (i) money available in the fund to each county under Subsection (4); and
481          (ii) the provisions of this section.
482          (b) Fund money may be used to pay interest on debts incurred in accordance with this
483     section.
484          (c) (i) (A) Fund money may be used to pay maintenance costs of properties acquired
485     under this section but limited to a total of 5% of the purchase price of the property.
486          (B) Any additional maintenance cost shall be paid from funds other than under this
487     section.
488          (C) Revenue generated by any property acquired under this section is excluded from
489     the limitations under this Subsection (5)(c)(i).
490          (ii) Fund money may be used to pay direct costs of acquisition of properties acquired
491     under this section.
492          (d) Fund money allocated and distributed under Subsection (4) may be used by a
493     county highway authority for countywide transportation planning if:
494          (i) the county's planning focus area is outside the boundaries of a metropolitan
495     planning organization;
496          (ii) the transportation planning is part of the county's continuing, cooperative, and
497     comprehensive process for transportation planning, corridor preservation, right-of-way
498     acquisition, and project programming;
499          (iii) no more than four years allocation every 20 years to each county is used for
500     transportation planning under this Subsection (5)(d); and
501          (iv) the county otherwise qualifies to use the fund money as provided under this
502     section.
503          (e) (i) Subject to Subsection (11), fund money allocated and distributed under
504     Subsection (4) may be used by a county highway authority for transportation corridor planning
505     that is part of the corridor elements of an ongoing work program of transportation projects.

506          (ii) The transportation corridor planning under Subsection (5)(e)(i) shall be under the
507     direction of:
508          (A) the metropolitan planning organization if the county is within the boundaries of a
509     metropolitan planning organization; or
510          (B) the department if the county is not within the boundaries of a metropolitan
511     planning organization.
512          (f) (i) A county, city, or town that imposes a local option highway construction and
513     transportation corridor preservation fee under Section 41-1a-1222 may elect to administer the
514     funds allocated and distributed to that county, city, or town under Subsection (4) as a revolving
515     loan fund.
516          (ii) If a county, city, or town elects to administer the funds allocated and distributed to
517     that county, city, or town under Subsection (4) as a revolving loan fund, a local highway
518     authority shall repay the fund money authorized for the project to the fund.
519          (iii) A county, city, or town that elects to administer the funds allocated and distributed
520     to that county, city, or town under Subsection (4) as a revolving loan fund shall establish
521     repayment conditions of the money to the fund from the specified project funds.
522          (g) (i) Subject to the restrictions in Subsections (5)(g)(ii) and (iii), fund money may be
523     used by a county of the third, fourth, fifth, or sixth class or by a city or town within a county of
524     the third, fourth, fifth, or sixth class for:
525          (A) the construction, operation, or maintenance of a class B road or class C road; or
526          (B) the restoration or repair of survey monuments associated with transportation
527     infrastructure.
528          (ii) A county, city, or town may not use more than 50% of the current balance of fund
529     money allocated to the county, city, or town for the purposes described in Subsection (5)(g)(i).
530          (iii) A county, city, or town may not use more than 50% of the fund revenue collections
531     allocated to a county, city, or town in the current fiscal year for the purposes described in
532     Subsection (5)(g)(i).
533          (6) (a) (i) The Local Highway and Transportation Corridor Preservation Fund shall be

534     used to preserve highway corridors, promote long-term statewide transportation planning, save
535     on acquisition costs, and promote the best interests of the state in a manner which minimizes
536     impact on prime agricultural land.
537          (ii) The Local Highway and Transportation Corridor Preservation Fund shall only be
538     used to preserve a highway corridor that is right-of-way:
539          (A) in a county of the first or second class for:
540          (I) a state highway;
541          (II) a principal arterial highway as defined in Section 72-4-102.5;
542          (III) a minor arterial highway as defined in Section 72-4-102.5; or
543          (IV) a collector highway in an urban area as defined in Section 72-4-102.5; or
544          (B) in a county of the third, fourth, fifth, or sixth class for:
545          (I) a state highway;
546          (II) a principal arterial highway as defined in Section 72-4-102.5;
547          (III) a minor arterial highway as defined in Section 72-4-102.5;
548          (IV) a major collector highway as defined in Section 72-4-102.5; or
549          (V) a minor collector road as defined in Section 72-4-102.5.
550          (iii) The Local Highway and Transportation Corridor Preservation Fund may not be
551     used for a highway corridor that is primarily a recreational trail as defined under Section
552     79-5-102.
553          (b) A highway authority shall authorize the expenditure of fund money after
554     determining that the expenditure is being made in accordance with this section from
555     applications that are:
556          (i) endorsed by the council of governments; and
557          (ii) for a right-of-way purchase for a highway authorized under Subsection (6)(a)(ii).
558          (7) (a) (i) A council of governments shall establish a council of governments
559     endorsement process which includes prioritization and application procedures for use of the
560     money allocated to each county under this section.
561          (ii) The endorsement process under Subsection (7)(a)(i) may include review or

562     endorsement of the preservation project by:
563          (A) the metropolitan planning organization if the county is within the boundaries of a
564     metropolitan planning organization; or
565          (B) the department if the county is not within the boundaries of a metropolitan
566     planning organization.
567          (b) All fund money shall be prioritized by each highway authority and council of
568     governments based on considerations, including:
569          (i) areas with rapidly expanding population;
570          (ii) the willingness of local governments to complete studies and impact statements
571     that meet department standards;
572          (iii) the preservation of corridors by the use of local planning and zoning processes;
573          (iv) the availability of other public and private matching funds for a project;
574          (v) the cost-effectiveness of the preservation projects;
575          (vi) long and short-term maintenance costs for property acquired; and
576          (vii) whether the transportation corridor is included as part of:
577          (A) the county and municipal master plan; and
578          (B) (I) the statewide long range plan; or
579          (II) the regional transportation plan of the area metropolitan planning organization if
580     one exists for the area.
581          (c) The council of governments shall:
582          (i) establish a priority list of highway corridor preservation projects within the county;
583          (ii) submit the list described in Subsection (7)(c)(i) to the county's legislative body for
584     approval; and
585          (iii) obtain approval of the list described in Subsection (7)(c)(i) from a majority of the
586     members of the county legislative body.
587          (d) A county's council of governments may only submit one priority list described in
588     Subsection (7)(c)(i) per calendar year.
589          (e) A county legislative body may only consider and approve one priority list described

590     in Subsection (7)(c)(i) per calendar year.
591          (8) (a) Unless otherwise provided by written agreement with another highway
592     authority, the highway authority that holds the deed to the property is responsible for
593     maintenance of the property.
594          (b) The transfer of ownership for property acquired under this section from one
595     highway authority to another shall include a recorded deed for the property and a written
596     agreement between the highway authorities.
597          (9) (a) The proceeds from any bonds or other obligations secured by revenues of the
598     Local Highway and Transportation Corridor Preservation Fund shall be used for the purposes
599     authorized for funds under this section.
600          (b) The highway authority shall pledge the necessary part of the revenues of the Local
601     Highway and Transportation Corridor Preservation Fund to the payment of principal and
602     interest on the bonds or other obligations.
603          (10) (a) A highway authority may not expend money under this section to purchase a
604     right-of-way for a state highway unless the highway authority has:
605          (i) a transportation corridor property acquisition policy or ordinance in effect that
606     meets department requirements for the acquisition of real property or any interests in real
607     property under this section; and
608          (ii) an access management policy or ordinance in effect that meets the requirements
609     under Subsection 72-2-117(8).
610          (b) The provisions of Subsection (10)(a)(i) do not apply if the highway authority has a
611     written agreement with the department for the department to acquire real property or any
612     interests in real property on behalf of the local highway authority under this section.
613          (11) The county shall ensure, to the extent possible, that the fund money allocated and
614     distributed to a city or town in accordance with Subsection (4) is expended:
615          (a) to fund a project or service as allowed by this section within the city or town to
616     which the fund money is allocated;
617          (b) to pay debt service, principal, or interest on a bond or other obligation as allowed

618     by this section if that bond or other obligation is:
619          (i) secured by money allocated to the city or town; and
620          (ii) issued to finance a project or service as allowed by this section within the city or
621     town to which the fund money is allocated;
622          (c) to fund transportation planning as allowed by this section within the city or town to
623     which the fund money is allocated; or
624          (d) for another purpose allowed by this section within the city or town to which the
625     fund money is allocated.