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7 LONG TITLE
8 General Description:
9 This bill amends and enacts provisions related to state and local taxes and revenues.
10 Highlighted Provisions:
11 This bill:
12 ▸ amends and enacts defined terms for the Minimum School Program;
13 ▸ amends for a five-year period the calculation of the minimum basic local amount
14 and minimum basic tax rate;
15 ▸ establishes the weighted pupil unit value tax rate;
16 ▸ establishes the equity pupil tax rate;
17 ▸ directs the Division of Finance to deposit an amount equal to the proceeds from:
18 • the equity pupil tax rate into the Local Levy Growth Account; and
19 • the weighted pupil unit value tax rate into the Teacher and Student Success
20 Account;
21 ▸ directs the Legislature to annually appropriate money from the Local Levy Growth
22 Account to guarantee local levy increments;
23 ▸ directs the State Board of Education to use the appropriation to increase:
24 • the number of guaranteed local levy increments to 20, giving first priority to
25 guaranteed voted local levy increments and second priority to guaranteed board
26 local levy increments; and
27 • the guaranteed amount for each local levy increment per weighted pupil unit
28 after increasing the number of guaranteed local levy increments;
29 ▸ directs a local school board to use funds received from the state local levy guarantee
30 programs for public education purposes;
31 ▸ creates the Local Levy Growth Account;
32 ▸ creates the Teacher and Student Success Account;
33 ▸ modifies the property tax rate cap for the school board local levy to subject all
34 school districts to the same rate cap;
35 ▸ repeals the following outdated levies prohibited since January 1, 2012:
36 • the board-approved leeway;
37 • the capital outlay levy;
38 • the additional levy for debt service, school sites, buildings, buses, textbooks,
39 and supplies; and
40 • the board leeway for reading improvement;
41 ▸ repeals outdated language, including language related to school capital outlay in
42 counties of the first class repealed December 31, 2016;
43 ▸ modifies the definition of "certified revenue levy" in the Property Tax Act;
44 ▸ modifies the homeowner's and renter's credits;
45 ▸ modifies provisions governing notice requirements for a proposed tax increase by
46 the state;
47 ▸ addresses the apportionment of business income for income tax purposes by:
48 • phasing in a requirement that certain taxpayers use only the sales factor to
49 calculate the fraction for apportioning business income to the state;
50 • allowing an optional apportionment taxpayer to choose between a single sales
51 factor and an equally weighted method to calculate the fraction for apportioning
52 business income to the state; and
53 • requiring an optional apportionment taxpayer that chooses to apportion business
54 income using the single sales factor method to continue using the single sales
55 factor method of apportionment in subsequent taxable years;
56 ▸ provides a method for a taxpayer to determine if the taxpayer is an optional
57 apportionment taxpayer;
58 ▸ reduces the state's corporate and individual income tax rates;
59 ▸ addresses when an individual is considered to have domicile in this state for
60 purposes of income tax;
61 ▸ defines terms;
62 ▸ modifies the calculation of the taxpayer tax credit;
63 ▸ creates study provisions;
64 ▸ provides repeal dates; and
65 ▸ makes technical and conforming changes.
66 Money Appropriated in this Bill:
67 This bill appropriates in fiscal year 2019:
68 ▸ to the Education Fund Restricted -- Teacher and Student Success Account
69 • from the Education Fund, $65,150,000;
70 ▸ to the State Board of Education -- Minimum School Program - Basic School
71 Program, as an ongoing appropriation:
72 • from the Education Fund, ($18,650,000); and
73 • from Local Revenue, $18,650,000;
74 ▸ to the State Board of Education -- Minimum School Program - Related to Basic
75 School Program:
76 • from the Education Fund, ($46,500,000); and
77 • from the Education Fund Restricted -- Teacher and Student Success Account, as
78 a one-time appropriation, $65,150,000;
79 ▸ to the Education Fund Restricted -- Local Levy Growth Account, as an ongoing
80 appropriation:
81 • from the Education Fund, $36,117,300;
82 ▸ to the State Board of Education -- Minimum School Program -- Basic School
83 Program, as an ongoing appropriation:
84 • from the Education Fund, ($36,117,300); and
85 • from Local Revenue, $36,117,300; and
86 ▸ to the State Board of Education -- Minimum School Program -- Voted and Board
87 Local Levy Programs, as an ongoing appropriation:
88 • from the Education Fund Restricted -- Local Levy Growth Account,
89 $36,117,300.
90 Other Special Clauses:
91 This bill provides a special effective date.
92 This bill provides retrospective operation.
93 This bill provides coordination clauses.
94 Utah Code Sections Affected:
95 AMENDS:
96 11-13-302, as last amended by Laws of Utah 2015, Chapter 287
97 11-13-310, as last amended by Laws of Utah 2003, Chapter 21
98 53E-2-304, as renumbered and amended by Laws of Utah 2018, Chapter 1
99 53F-2-102, as renumbered and amended by Laws of Utah 2018, Chapter 2
100 53F-2-201, as renumbered and amended by Laws of Utah 2018, Chapter 2
101 53F-2-203, as renumbered and amended by Laws of Utah 2018, Chapter 2
102 53F-2-205, as renumbered and amended by Laws of Utah 2018, Chapter 2
103 53F-2-301, as renumbered and amended by Laws of Utah 2018, Chapter 2
104 53F-2-303, as enacted by Laws of Utah 2018, Chapter 2
105 53F-2-312, as renumbered and amended by Laws of Utah 2018, Chapter 2
106 53F-2-503, as renumbered and amended by Laws of Utah 2018, Chapter 2
107 53F-2-515, as renumbered and amended by Laws of Utah 2018, Chapter 2
108 53F-2-601, as enacted by Laws of Utah 2018, Chapter 2
109 53F-2-704, as enacted by Laws of Utah 2018, Chapter 2
110 53F-3-102, as renumbered and amended by Laws of Utah 2018, Chapter 2
111 53F-8-302, as renumbered and amended by Laws of Utah 2018, Chapter 2
112 53F-8-303, as renumbered and amended by Laws of Utah 2018, Chapter 2
113 53F-8-402, as renumbered and amended by Laws of Utah 2018, Chapter 2
114 53F-9-302, as renumbered and amended by Laws of Utah 2018, Chapter 2
115 53G-3-304, as renumbered and amended by Laws of Utah 2018, Chapter 3
116 53G-6-705, as renumbered and amended by Laws of Utah 2018, Chapter 3
117 59-2-102, as last amended by Laws of Utah 2016, Chapters 98, 308, 367, and 368
118 59-2-926, as last amended by Laws of Utah 2016, Chapter 367
119 59-2-1208, as last amended by Laws of Utah 2016, Chapter 375
120 59-2-1209, as last amended by Laws of Utah 2016, Chapter 375
121 59-7-104, as repealed and reenacted by Laws of Utah 1993, Chapter 169
122 59-7-110, as last amended by Laws of Utah 2016, Chapters 311 and 323
123 59-7-201, as last amended by Laws of Utah 1993, Chapter 169
124 59-7-302, as last amended by Laws of Utah 2017, Chapters 181 and 268
125 59-7-311, as last amended by Laws of Utah 2016, Chapters 311 and 323
126 59-7-312, as last amended by Laws of Utah 2008, Chapter 283
127 59-7-315, as last amended by Laws of Utah 2008, Chapter 283
128 59-10-104, as last amended by Laws of Utah 2008, Chapter 389
129 59-10-136, as enacted by Laws of Utah 2011, Chapter 410
130 59-10-1018, as last amended by Laws of Utah 2012, Chapter 295
131 63I-2-211, as last amended by Laws of Utah 2017, Chapter 441
132 63I-2-253, as last amended by Laws of Utah 2017, Chapters 217, 223, 350, 365, 381,
133 386, and 468
134 63I-2-259, as last amended by Laws of Utah 2017, Chapter 181
135 63J-1-220, as last amended by Laws of Utah 2017, Chapter 173
136 ENACTS:
137 53F-2-301.5, Utah Code Annotated 1953
138 53F-9-305, Utah Code Annotated 1953
139 53F-9-306, Utah Code Annotated 1953
140 59-1-102, Utah Code Annotated 1953
141 REPEALS:
142 53F-2-602, as enacted by Laws of Utah 2018, Chapter 2
143 53F-8-401, as renumbered and amended by Laws of Utah 2018, Chapter 2
144 53F-8-404, as renumbered and amended by Laws of Utah 2018, Chapter 2
145 53F-8-405, as renumbered and amended by Laws of Utah 2018, Chapter 2
146 53F-8-406, as renumbered and amended by Laws of Utah 2018, Chapter 2
147 Utah Code Sections Affected by Coordination Clause:
148 53F-2-301, as renumbered and amended by Laws of Utah 2018, Chapter 2
149 59-7-302, as last amended by Laws of Utah 2017, Chapters 181 and 268
150 59-7-311, as last amended by Laws of Utah 2016, Chapters 311 and 323
151 59-7-312, as last amended by Laws of Utah 2008, Chapter 283
152 59-7-315, as last amended by Laws of Utah 2008, Chapter 283
153
154 Be it enacted by the Legislature of the state of Utah:
155 Section 1. Section 11-13-302 is amended to read:
156 11-13-302. Payment of fee in lieu of ad valorem property tax by certain energy
157 suppliers -- Method of calculating -- Collection -- Extent of tax lien.
158 (1) (a) Each project entity created under this chapter that owns a project and that sells
159 any capacity, service, or other benefit from it to an energy supplier or suppliers whose tangible
160 property is not exempted by Utah Constitution Article XIII, Section 3, from the payment of ad
161 valorem property tax, shall pay an annual fee in lieu of ad valorem property tax as provided in
162 this section to each taxing jurisdiction within which the project or any part of it is located.
163 (b) For purposes of this section, "annual fee" means the annual fee described in
164 Subsection (1)(a) that is in lieu of ad valorem property tax.
165 (c) The requirement to pay an annual fee shall commence:
166 (i) with respect to each taxing jurisdiction that is a candidate receiving the benefit of
167 impact alleviation payments under contracts or determination orders provided for in Sections
168 11-13-305 and 11-13-306, with the fiscal year of the candidate following the fiscal year of the
169 candidate in which the date of commercial operation of the last generating unit, other than any
170 generating unit providing additional project capacity, of the project occurs, or, in the case of
171 any facilities providing additional project capacity, with the fiscal year of the candidate
172 following the fiscal year of the candidate in which the date of commercial operation of the
173 generating unit providing the additional project capacity occurs; and
174 (ii) with respect to any taxing jurisdiction other than a taxing jurisdiction described in
175 Subsection (1)(c)(i), with the fiscal year of the taxing jurisdiction in which construction of the
176 project commences, or, in the case of facilities providing additional project capacity, with the
177 fiscal year of the taxing jurisdiction in which construction of those facilities commences.
178 (d) The requirement to pay an annual fee shall continue for the period of the useful life
179 of the project or facilities.
180 (2) (a) The annual fees due a school district shall be as provided in Subsection (2)(b)
181 because the ad valorem property tax imposed by a school district and authorized by the
182 Legislature represents both:
183 (i) a levy mandated by the state for the state minimum school program under Section
184 53A-17a-135 or 53F-2-301.5, as applicable ; and
185 (ii) local levies for capital outlay and other purposes under Sections 53A-16-113,
186 53A-17a-133, and 53A-17a-164.
187 (b) The annual fees due a school district shall be as follows:
188 (i) the project entity shall pay to the school district an annual fee for the state minimum
189 school program at the rate imposed by the school district and authorized by the Legislature
190 under Section 53A-17a-135 or 53F-2-301.5, as applicable ; and
191 (ii) for all other local property tax levies authorized to be imposed by a school district,
192 the project entity shall pay to the school district either:
193 (A) an annual fee; or
194 (B) impact alleviation payments under contracts or determination orders provided for
195 in Sections 11-13-305 and 11-13-306.
196 (3) (a) An annual fee due a taxing jurisdiction for a particular year shall be calculated
197 by multiplying the tax rate or rates of the jurisdiction for that year by the product obtained by
198 multiplying the fee base or value determined in accordance with Subsection (4) for that year of
199 the portion of the project located within the jurisdiction by the percentage of the project which
200 is used to produce the capacity, service, or other benefit sold to the energy supplier or suppliers.
201 (b) As used in this section, "tax rate," when applied in respect to a school district,
202 includes any assessment to be made by the school district under Subsection (2) or Section
203 63M-5-302.
204 (c) There is to be credited against the annual fee due a taxing jurisdiction for each year,
205 an amount equal to the debt service, if any, payable in that year by the project entity on bonds,
206 the proceeds of which were used to provide public facilities and services for impact alleviation
207 in the taxing jurisdiction in accordance with Sections 11-13-305 and 11-13-306.
208 (d) The tax rate for the taxing jurisdiction for that year shall be computed so as to:
209 (i) take into account the fee base or value of the percentage of the project located
210 within the taxing jurisdiction determined in accordance with Subsection (4) used to produce the
211 capacity, service, or other benefit sold to the supplier or suppliers; and
212 (ii) reflect any credit to be given in that year.
213 (4) (a) Except as otherwise provided in this section, the annual fees required by this
214 section shall be paid, collected, and distributed to the taxing jurisdiction as if:
215 (i) the annual fees were ad valorem property taxes; and
216 (ii) the project were assessed at the same rate and upon the same measure of value as
217 taxable property in the state.
218 (b) (i) Notwithstanding Subsection (4)(a), for purposes of an annual fee required by
219 this section, the fee base of a project may be determined in accordance with an agreement
220 among:
221 (A) the project entity; and
222 (B) any county that:
223 (I) is due an annual fee from the project entity; and
224 (II) agrees to have the fee base of the project determined in accordance with the
225 agreement described in this Subsection (4).
226 (ii) The agreement described in Subsection (4)(b)(i):
227 (A) shall specify each year for which the fee base determined by the agreement shall be
228 used for purposes of an annual fee; and
229 (B) may not modify any provision of this chapter except the method by which the fee
230 base of a project is determined for purposes of an annual fee.
231 (iii) For purposes of an annual fee imposed by a taxing jurisdiction within a county
232 described in Subsection (4)(b)(i)(B), the fee base determined by the agreement described in
233 Subsection (4)(b)(i) shall be used for purposes of an annual fee imposed by that taxing
234 jurisdiction.
235 (iv) (A) If there is not agreement as to the fee base of a portion of a project for any
236 year, for purposes of an annual fee, the State Tax Commission shall determine the value of that
237 portion of the project for which there is not an agreement:
238 (I) for that year; and
239 (II) using the same measure of value as is used for taxable property in the state.
240 (B) The valuation required by Subsection (4)(b)(iv)(A) shall be made by the State Tax
241 Commission in accordance with rules made by the State Tax Commission.
242 (c) Payments of the annual fees shall be made from:
243 (i) the proceeds of bonds issued for the project; and
244 (ii) revenues derived by the project entity from the project.
245 (d) (i) The contracts of the project entity with the purchasers of the capacity, service, or
246 other benefits of the project whose tangible property is not exempted by Utah Constitution
247 Article XIII, Section 3, from the payment of ad valorem property tax shall require each
248 purchaser, whether or not located in the state, to pay, to the extent not otherwise provided for,
249 its share, determined in accordance with the terms of the contract, of these fees.
250 (ii) It is the responsibility of the project entity to enforce the obligations of the
251 purchasers.
252 (5) (a) The responsibility of the project entity to make payment of the annual fees is
253 limited to the extent that there is legally available to the project entity, from bond proceeds or
254 revenues, money to make these payments, and the obligation to make payments of the annual
255 fees is not otherwise a general obligation or liability of the project entity.
256 (b) No tax lien may attach upon any property or money of the project entity by virtue of
257 any failure to pay all or any part of an annual fee.
258 (c) The project entity or any purchaser may contest the validity of an annual fee to the
259 same extent as if the payment was a payment of the ad valorem property tax itself.
260 (d) The payments of an annual fee shall be reduced to the extent that any contest is
261 successful.
262 (6) (a) The annual fee described in Subsection (1):
263 (i) shall be paid by a public agency that:
264 (A) is not a project entity; and
265 (B) owns an interest in a facility providing additional project capacity if the interest is
266 otherwise exempt from taxation pursuant to Utah Constitution, Article XIII, Section 3; and
267 (ii) for a public agency described in Subsection (6)(a)(i), shall be calculated in
268 accordance with Subsection (6)(b).
269 (b) The annual fee required under Subsection (6)(a) shall be an amount equal to the tax
270 rate or rates of the applicable taxing jurisdiction multiplied by the product of the following:
271 (i) the fee base or value of the facility providing additional project capacity located
272 within the jurisdiction;
273 (ii) the percentage of the ownership interest of the public agency in the facility; and
274 (iii) the portion, expressed as a percentage, of the public agency's ownership interest
275 that is attributable to the capacity, service, or other benefit from the facility that is sold by the
276 public agency to an energy supplier or suppliers whose tangible property is not exempted by
277 Utah Constitution, Article XIII, Section 3, from the payment of ad valorem property tax.
278 (c) A public agency paying the annual fee pursuant to Subsection (6)(a) shall have the
279 obligations, credits, rights, and protections set forth in Subsections (1) through (5) with respect
280 to its ownership interest as though it were a project entity.
281 Section 2. Section 11-13-310 is amended to read:
282 11-13-310. Termination of impact alleviation contract.
283 If the project or any part of it or the facilities providing additional project capacity or
284 any part of them, or the output from the project or facilities providing additional project
285 capacity become subject, in addition to the requirements of Section 11-13-302, to ad valorem
286 property taxation or other payments in lieu of ad valorem property taxation, or other form of
287 tax equivalent payments to any candidate which is a party to an impact alleviation contract with
288 respect to the project or facilities providing additional project capacity or is receiving impact
289 alleviation payments or means with respect to the project or facilities providing additional
290 project capacity pursuant to a determination by the board, then the impact alleviation contract
291 or the requirement to make impact alleviation payments or provide means therefor pursuant to
292 the determination, as the case may be, shall, at the election of the candidate, terminate. In any
293 event, each impact alleviation contract or determination order shall terminate upon the project,
294 or, in the case of facilities providing additional project capacity, those facilities becoming
295 subject to the provisions of Section 11-13-302, except that no impact alleviation contract or
296 agreement entered by a school district shall terminate because of in lieu ad valorem property
297 tax fees levied under Subsection 11-13-302(2)(b)(i) or because of ad valorem property taxes
298 levied under Section [
299 minimum school program. In addition, if the construction of the project, or, in the case of
300 facilities providing additional project capacity, of those facilities, is permanently terminated for
301 any reason, each impact alleviation contract and determination order, and the payments and
302 means required thereunder, shall terminate. No termination of an impact alleviation contract or
303 determination order may terminate or reduce any liability previously incurred pursuant to the
304 contract or determination order by the candidate beneficiary under it. If the provisions of
305 Section 11-13-302, or its successor, are held invalid by a court of competent jurisdiction, and
306 no ad valorem taxes or other form of tax equivalent payments are payable, the remaining
307 provisions of this chapter shall continue in operation without regard to the commencement of
308 commercial operation of the last generating unit of that project or of facilities providing
309 additional project capacity.
310 Section 3. Section 53E-2-304 is amended to read:
311 53E-2-304. School district and individual school powers -- Plan for college and
312 career readiness definition.
313 (1) In order to acquire and develop the characteristics listed in Section 53E-2-302, each
314 school district and each public school within its respective district shall implement a
315 comprehensive system of accountability in which students advance through public schools by
316 demonstrating competency in the core standards for Utah public schools through the use of
317 diverse assessment instruments such as authentic assessments, projects, and portfolios.
318 (2) (a) Each school district and public school shall:
319 (i) develop and implement programs integrating technology into the curriculum,
320 instruction, and student assessment;
321 (ii) provide for teacher and parent involvement in policymaking at the school site;
322 (iii) implement a public school choice program to give parents, students, and teachers
323 greater flexibility in designing and choosing among programs with different focuses through
324 schools within the same district and other districts, subject to space availability, demographics,
325 and legal and performance criteria;
326 (iv) establish strategic planning at both the district and school level and site-based
327 decision making programs at the school level;
328 (v) provide opportunities for each student to acquire and develop academic and
329 occupational knowledge, skills, and abilities;
330 (vi) participate in ongoing research and development projects primarily at the school
331 level aimed at improving the quality of education within the system; and
332 (vii) involve business and industry in the education process through the establishment
333 of partnerships with the business community at the district and school level.
334 (b) (i) As used in this section, "plan for college and career readiness" means a plan
335 developed by a student and the student's parent or guardian, in consultation with school
336 counselors, teachers, and administrators that:
337 (A) is initiated at the beginning of grade 7;
338 (B) identifies a student's skills and objectives;
339 (C) maps out a strategy to guide a student's course selection; and
340 (D) links a student to post-secondary options, including higher education and careers.
341 (ii) Each local school board, in consultation with school personnel, parents, and school
342 community councils or similar entities shall establish policies to provide for the effective
343 implementation of an individual learning plan or a plan for college and career readiness for
344 each student at the school site.
345 (iii) The policies shall include guidelines and expectations for:
346 (A) recognizing the student's accomplishments, strengths, and progress toward meeting
347 student achievement standards as defined in the core standards for Utah public schools;
348 (B) planning, monitoring, and managing education and career development; and
349 (C) involving students, parents, and school personnel in preparing and implementing
350 an individual learning plan and a plan for college and career readiness.
351 (iv) A parent may request a conference with school personnel in addition to an
352 individual learning plan or a plan for college and career readiness conference established by
353 local school board policy.
354 (v) Time spent during the school day to implement an individual learning plan or a
355 plan for college and career readiness is considered part of the school term [
356
357 (3) A school district or public school may submit proposals to modify or waive rules or
358 policies of a supervisory authority within the public education system in order to acquire or
359 develop the characteristics listed in Section 53E-2-302.
360 (4) (a) Each school district and public school shall make an annual report to its patrons
361 on its activities under this section.
362 (b) The reporting process shall involve participation from teachers, parents, and the
363 community at large in determining how well the district or school is performing.
364 Section 4. Section 53F-2-102 is amended to read:
365 53F-2-102. Definitions.
366 As used in this chapter:
367 (1) "Basic state-supported school program," [
368 program" means public education programs for kindergarten, elementary, and secondary school
369 students that are operated and maintained for the amount derived by multiplying the number of
370 weighted pupil units for each school district or charter school by the value established each
371 year in [
372 chapter.
373 [
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375 [
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377 [
378 [
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380 [
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382 [
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384 [
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395 [
396 Section 53G-5-102, that governs a charter school.
397 [
398 governing board.
399 [
400 2, Election of Members of Local Boards of Education.
401 [
402 pupil.
403 [
404 Program" means public school programs for kindergarten, elementary, and secondary schools
405 as described in this Subsection [
406 (b) The Minimum School Program established in school districts and charter schools
407 shall include the equivalent of a school term of nine months as determined by the State Board
408 of Education.
409 (c) (i) The board shall establish the number of days or equivalent instructional hours
410 that school is held for an academic school year.
411 (ii) Education, enhanced by utilization of technologically enriched delivery systems,
412 when approved by a local education board, shall receive full support by the State Board of
413 Education as it pertains to fulfilling the attendance requirements, excluding time spent viewing
414 commercial advertising.
415 (d) (i) A local education board may reallocate up to 32 instructional hours or four
416 school days established under Subsection [
417 professional development.
418 (ii) A reallocation of instructional hours or school days under Subsection [
419 is subject to the approval of two-thirds of the members of a local education board voting in a
420 regularly scheduled meeting:
421 (A) at which a quorum of the local education board is present; and
422 (B) held in compliance with Title 52, Chapter 4, Open and Public Meetings Act.
423 (iii) If a local education board reallocates instructional hours or school days as
424 provided by this Subsection [
425 students' parents and guardians of the school calendar at least 90 days before the beginning of
426 the school year.
427 (iv) Instructional hours or school days reallocated for teacher preparation time or
428 teacher professional development pursuant to this Subsection [
429 school term referred to in Subsection [
430 (e) The Minimum School Program includes a program or allocation funded by a line
431 item appropriation or other appropriation designated as follows:
432 (i) Basic School Program;
433 (ii) Related to Basic Programs;
434 (iii) Voted and Board Levy Programs; or
435 (iv) Minimum School Program.
436 [
437 factors that is computed in accordance with this chapter for the purpose of determining the
438 costs of a program on a uniform basis for each school district or charter school.
439 Section 5. Section 53F-2-201 is amended to read:
440 53F-2-201. Cost of operation and maintenance of Minimum School Program --
441 Division between state and school districts.
442 (1) The total cost of operation and maintenance of the Minimum School Program in the
443 state is divided between the state and school districts as follows:
444 (a) Each school district shall impose a minimum basic tax rate on all taxable, tangible
445 property in the school district and shall contribute the tax proceeds toward the cost of the basic
446 program as provided in this chapter.
447 (b) Each school district may also impose a levy under Section 53F-8-301 or 53F-8-302
448 for the purpose of participating in the respective local levy state guarantee programs [
449 described in Section 53F-2-601 [
450 (c) The state shall contribute the balance of the total costs.
451 (2) The contributions by the school districts and by the state are computed separately
452 for the purpose of determining their respective contributions to:
453 (a) the basic program; and [
454
455 (b) the local levy state guarantee programs described in Section 53F-2-601.
456 Section 6. Section 53F-2-203 is amended to read:
457 53F-2-203. Reduction of local education board allocation based on insufficient
458 revenues.
459 (1) As used in this section, "Minimum School Program funds" means the total of state
460 and local funds appropriated for the Minimum School Program, excluding:
461 [
462 [
463 (a) an appropriation for a state guaranteed local levy increment as described in Section
464 53F-2-601; and
465 [
466 pursuant to Section 53F-2-704.
467 (2) If the Legislature reduces appropriations made to support public schools under this
468 chapter because an Education Fund budget deficit, as defined in Section 63J-1-312, exists, the
469 State Board of Education, after consultation with each local education board, shall allocate the
470 reduction among school districts and charter schools in proportion to each school district's or
471 charter school's percentage share of Minimum School Program funds.
472 (3) Except as provided in Subsection (5) and subject to the requirements of Subsection
473 (7), a local education board shall determine which programs are affected by a reduction
474 pursuant to Subsection (2) and the amount each program is reduced.
475 (4) Except as provided in Subsections (5) and (6), the requirement to spend a specified
476 amount in any particular program is waived if reductions are made pursuant to Subsection (2).
477 (5) A local education board may not reduce or reallocate spending of funds distributed
478 to the school district or charter school for the following programs:
479 (a) educator salary adjustments provided in Section 53F-2-405;
480 (b) the Teacher Salary Supplement Program provided in Section 53F-2-504;
481 (c) the extended year for special educators provided in Section 53F-2-310;
482 (d) USTAR centers provided in Section 53F-2-505;
483 (e) the School LAND Trust Program created in Section 53F-2-404; or
484 (f) a special education program within the [
485 program.
486 (6) A local education board may not reallocate spending of funds distributed to the
487 school district or charter school to a reserve account.
488 (7) A local education board that reduces or reallocates funds in accordance with this
489 section shall report all transfers into, or out of, Minimum School Program programs to the
490 State Board of Education as part of the school district or charter school's Annual Financial and
491 Program report.
492 Section 7. Section 53F-2-205 is amended to read:
493 53F-2-205. Powers and duties of State Board of Education to adjust Minimum
494 School Program allocations -- Use of remaining funds at the end of a fiscal year.
495 (1) [
496 (a) "Board" means the State Board of Education.
497 (b) "ESEA" means the Elementary and Secondary Education Act of 1965, 20 U.S.C.
498 Sec. 6301 et seq.
499 (c) "Program" means a program or allocation funded by a line item appropriation or
500 other appropriation designated as:
501 (i) Basic Program;
502 (ii) Related to Basic Programs;
503 (iii) Voted and Board Levy Programs; or
504 (iv) Minimum School Program.
505 (2) Except as provided in Subsection (3) or (5), if the number of weighted pupil units
506 in a program is underestimated, the board shall reduce the value of the weighted pupil unit in
507 that program so that the total amount paid for the program does not exceed the amount
508 appropriated for the program.
509 (3) If the number of weighted pupil units in a program is overestimated, the board shall
510 spend excess money appropriated for the following purposes giving priority to the purpose
511 described in Subsection (3)(a):
512 (a) to support the value of the weighted pupil unit in a program within the basic
513 state-supported school program in which the number of weighted pupil units is underestimated;
514 (b) to support the state [
515
516
517 53F-2-601, if:
518 (i) local contributions to the voted local levy program or board local levy program are
519 overestimated; or
520 (ii) the number of weighted pupil units within school districts qualifying for a
521 guarantee is underestimated;
522 (c) to support the state supplement to local property taxes allocated to charter schools,
523 if the state supplement is less than the amount prescribed by Section 53F-2-704; or
524 (d) to support a school district with a loss in student enrollment as provided in Section
525 53F-2-207.
526 (4) If local contributions from the minimum basic tax rate imposed under Section
527 53F-2-301 or 53F-2-301.5, as applicable, are overestimated, the board shall reduce the value of
528 the weighted pupil unit for all programs within the basic state-supported school program so the
529 total state contribution to the basic state-supported school program does not exceed the amount
530 of state funds appropriated.
531 (5) If local contributions from the minimum basic tax rate imposed under Section
532 53F-2-301 or 53F-2-301.5, as applicable, are underestimated, the board shall:
533 (a) spend the excess local contributions for the purposes specified in Subsection (3),
534 giving priority to supporting the value of the weighted pupil unit in programs within the basic
535 state-supported school program in which the number of weighted pupil units is underestimated;
536 and
537 (b) reduce the state contribution to the basic state-supported school program so the
538 total cost of the basic state-supported school program does not exceed the total state and local
539 funds appropriated to the basic state-supported school program plus the local contributions
540 necessary to support the value of the weighted pupil unit in programs within the basic
541 state-supported school program in which the number of weighted pupil units is underestimated.
542 (6) Except as provided in Subsection (3) or (5), the board shall reduce the state
543 guarantee per weighted pupil unit provided under the [
544 local levy state guarantee program described in Section 53F-2-601 [
545
546 (a) local contributions to the voted local levy program or board local levy program are
547 overestimated; or
548 (b) the number of weighted pupil units within school districts qualifying for a
549 guarantee is underestimated.
550 (7) Money appropriated to the board is nonlapsing.
551 (8) The board shall report actions taken by the board under this section to the Office of
552 the Legislative Fiscal Analyst and the Governor's Office of Management and Budget.
553 Section 8. Section 53F-2-301 is amended to read:
554 53F-2-301. Minimum basic tax rate for a fiscal year that begins after July 1, 2022.
555 (1) The provisions of this section are not in effect for a fiscal year that begins on July 1,
556 2018, 2019, 2020, 2021, or 2022.
557 [
558 (a) "Basic levy increment rate" means a tax rate that will generate an amount of
559 revenue equal to $75,000,000.
560 [
561
562
563
564 (b) "Combined basic rate" means a rate that is the sum of:
565 (i) the minimum basic tax rate; and
566 (ii) the WPU value rate.
567 (c) "Commission" means the State Tax Commission.
568 (d) "Equity pupil tax rate" means the tax rate that will generate an amount of revenue
569 equal to the amount generated by the equity pupil tax rate as defined in Section 53F-2-301.5 in
570 the fiscal year that begins July 1, 2022.
571 (e) "Minimum basic local amount" means an amount that is:
572 (i) equal to the sum of:
573 (A) the school districts' contribution to the basic school program the previous fiscal
574 year;
575 (B) the amount generated by the basic levy increment rate;
576 (C) the amount generated by the equity pupil tax rate; and
577 (D) the eligible new growth, as defined in Section 59-2-924 and rules of the State Tax
578 Commission multiplied by the minimum basic rate; and
579 (ii) set annually by the Legislature in Subsection (3)(a).
580 (f) "Minimum basic tax rate" means a tax rate certified by the commission that will
581 generate an amount of revenue equal to the minimum basic local amount described in
582 Subsection (3)(a).
583 (g) "Weighted pupil unit value" or "WPU value" means the amount established each
584 year in the enacted public education budget that is multiplied by the number of weighted pupil
585 units to yield the funding level for the basic school program.
586 (h) "WPU value amount" means an amount:
587 (i) that is equal to the product of:
588 (A) the total cost to the basic school program to increase the WPU value over the WPU
589 value in the immediately preceding fiscal year; and
590 (B) the percentage share of local revenue to the cost of the basic school program in the
591 immediately preceding fiscal year; and
592 (ii) set annually by the Legislature in Subsection (4)(a).
593 (i) "WPU value rate" means a tax rate certified by the commission that will generate an
594 amount of revenue equal to the WPU value amount described in Subsection (4)(a).
595 (3) (a) The minimum basic local amount for the fiscal year that begins on July 1, 2018,
596 is $408,073,800 in revenue statewide.
597 (b) The preliminary estimate [
598 the minimum basic tax rate for a fiscal year that begins on July 1, 2018, is .001498.
599 [
600
601 [
602
603 (4) (a) The WPU value amount for the fiscal year that begins on July 1, 2018, is
604 $18,650,000 in revenue statewide.
605 (b) The preliminary estimate of the WPU value rate for the fiscal year that begins on
606 July 1, 2018, is .000069.
607 (5) (a) On or before June 22, the commission shall certify for the year:
608 (i) the minimum basic tax rate; and
609 (ii) the WPU value rate.
610 (b) The estimate of the minimum basic tax rate provided in Subsection (3)(b) and the
611 estimate of the WPU value rate provided in Subsection (4)(b) are based on a forecast for
612 property values for the next calendar year.
613 (c) The certified minimum basic tax rate described in Subsection (5)(a)(i) and the
614 certified WPU value rate described in Subsection (5)(a)(ii) are based on property values as of
615 January 1 of the current calendar year, except personal property, which is based on values from
616 the previous calendar year.
617 (6) (a) To qualify for receipt of the state contribution toward the basic school program
618 and as a school district's contribution toward the cost of the basic school program for the school
619 district, each local school board shall impose the combined basic rate.
620 (b) (i) The state is not subject to the notice requirements of Section 59-2-926 before
621 imposing the tax rates described in this Subsection (6).
622 (ii) (A) Except as provided in Subsection (6)(b)(ii)(B), the state is subject to the notice
623 requirements of Section 59-2-926 if the state authorizes a tax rate that exceeds the tax rates
624 described in this Subsection (6).
625 (B) For a calendar year that begins on January 1, 2018, the state is not subject to the
626 notice and public hearing requirements of Section 59-2-926 if the state authorizes a combined
627 basic rate that exceeds the tax rates authorized in this section.
628 [
629 basic school program in the school district [
630 amount of money that is the difference between the cost of the school district's basic school
631 program and the sum of revenue generated by the school district by the following:
632 [
633 (i) the combined basic rate;
634 [
635 (iii) the equity pupil tax rate.
636 [
637 the cost of the basic school program in a school district, no state contribution shall be made to
638 the basic school program for the school district.
639 [
640 the cost of the basic school program shall be paid into the Uniform School Fund as provided by
641 law and by the close of the fiscal year in which the proceeds were calculated.
642 [
643 [
644
645
646 [
647 (8) Upon appropriation by the Legislature, the Division of Finance shall deposit an
648 amount equal to the proceeds generated statewide:
649 (a) by the basic levy increment rate into the Minimum Basic Growth Account created
650 in Section 53F-9-302[
651 (b) by the equity pupil tax rate into the Local Levy Growth Account created in Section
652 53F-9-305; and
653 (c) by the WPU value rate into the Teacher and Student Success Account created in
654 Section 53F-9-306.
655 (9) After July 1, 2022, but before November 30, 2022, the Public Education
656 Appropriations Subcommittee:
657 (a) shall review the WPU value rate, the impact of revenues generated by the WPU
658 value rate on public education funding, and whether local school boards should continue to
659 levy the WPU value rate; and
660 (b) may recommend an increase, repeal, or continuance of the WPU value rate.
661 Section 9. Section 53F-2-301.5 is enacted to read:
662 53F-2-301.5. Minimum basic tax rate for a fiscal year that begins on July 1, 2018,
663 2019, 2020, 2021, or 2022.
664 (1) The provisions of this section are in effect for a fiscal year that begins before July 1,
665 2023.
666 (2) As used in this section:
667 (a) "Basic levy increment rate" means a tax rate that will generate an amount of
668 revenue equal to $75,000,000.
669 (b) "Combined basic rate" means a rate that is the sum of:
670 (i) the rate floor; and
671 (ii) the WPU value rate.
672 (c) "Commission" means the State Tax Commission.
673 (d) "Equity pupil tax rate" means the tax rate that is:
674 (i) calculated by subtracting the minimum basic tax rate from the rate floor; or
675 (ii) zero, if the rate calculated in accordance with Subsection (2)(d)(i) is zero or less.
676 (e) "Minimum basic local amount" means an amount that is:
677 (i) equal to the sum of:
678 (A) the school districts' contribution to the basic school program the previous fiscal
679 year;
680 (B) the amount generated by the basic levy increment rate; and
681 (C) the eligible new growth, as defined in Section 59-2-924 and rules of the State Tax
682 Commission multiplied by the minimum basic tax rate; and
683 (ii) set annually by the Legislature in Subsection (3)(a).
684 (f) "Minimum basic tax rate" means a tax rate certified by the commission that will
685 generate an amount of revenue equal to the minimum basic local amount described in
686 Subsection (3)(a).
687 (g) "Rate floor" means a rate that is the greater of:
688 (i) a .0016 tax rate; or
689 (ii) the minimum basic tax rate.
690 (h) "Weighted pupil unit value" or "WPU value" means the amount established each
691 year in the enacted public education budget that is multiplied by the number of weighted pupil
692 units to yield the funding level for the basic school program.
693 (i) "WPU value amount" means an amount that is:
694 (i) equal to the product of:
695 (A) the total cost to the basic school program to increase the WPU value over the WPU
696 value in the prior fiscal year; and
697 (B) the percentage share of local revenue to the cost of the basic school program in the
698 prior fiscal year; and
699 (ii) set annually by the Legislature in Subsection (4)(a).
700 (j) "WPU value rate" means a tax rate certified by the commission that will generate an
701 amount of revenue equal to the WPU value amount described in Subsection (4)(a).
702 (3) (a) The minimum basic local amount for the fiscal year that begins on July 1, 2018,
703 is $408,073,800 in revenue statewide.
704 (b) The preliminary estimate for the minimum basic tax rate for the fiscal year that
705 begins on July 1, 2018, is .001498.
706 (4) (a) The WPU value amount for the fiscal year that begins on July 1, 2018, is
707 $18,650,000 in revenue statewide.
708 (b) The preliminary estimate for the WPU value rate for the fiscal year that begins on
709 July 1, 2018, is .000069.
710 (5) (a) On or before June 22, the commission shall certify for the year:
711 (i) the minimum basic tax rate; and
712 (ii) the WPU value rate.
713 (b) The estimate of the minimum basic tax rate provided in Subsection (3)(b) and the
714 estimate of the WPU value rate provided in Subsection (4)(b) is based on a forecast for
715 property values for the next calendar year.
716 (c) The certified minimum basic tax rate described in Subsection (5)(a)(i) and the
717 certified WPU value rate described in Subsection (5)(a)(ii) are based on property values as of
718 January 1 of the current calendar year, except personal property, which is based on values from
719 the previous calendar year.
720 (6) (a) To qualify for receipt of the state contribution toward the basic school program
721 and as a school district's contribution toward the cost of the basic school program for the school
722 district, a local school board shall impose the combined basic rate.
723 (b) (i) The state is not subject to the notice requirements of Section 59-2-926 before
724 imposing the tax rates described in this Subsection (6).
725 (ii) The state is subject to the notice requirements of Section 59-2-926 if the state
726 authorizes a tax rate that exceeds the tax rates described in this Subsection (6).
727 (7) (a) The state shall contribute to each school district toward the cost of the basic
728 school program in the school district an amount of money that is the difference between the
729 cost of the school district's basic school program and the sum of the revenue generated by the
730 school district by the following:
731 (i) the minimum basic tax rate;
732 (ii) the basic levy increment rate;
733 (iii) the equity pupil tax rate; and
734 (iv) the WPU value rate.
735 (b) (i) If the difference described in Subsection (7)(a) equals or exceeds the cost of the
736 basic school program in a school district, no state contribution shall be made to the basic
737 school program for the school district.
738 (ii) The proceeds of the difference described in Subsection (7)(a) that exceed the cost
739 of the basic school program shall be paid into the Uniform School Fund as provided by law and
740 by the close of the fiscal year in which the proceeds were calculated.
741 (8) Upon appropriation by the Legislature, the Division of Finance shall deposit an
742 amount equal to the proceeds generated statewide:
743 (a) by the basic levy increment rate into the Minimum Basic Growth Account created
744 in Section 53F-9-302;
745 (b) by the equity pupil tax rate into the Local Levy Growth Account created in Section
746 53F-9-305; and
747 (c) by the WPU value rate into the Teacher and Student Success Account created in
748 Section 53F-9-306.
749 Section 10. Section 53F-2-303 is amended to read:
750 53F-2-303. Foreign exchange student weighted pupil units.
751 (1) A school district or charter school may include foreign exchange students in the
752 district's or school's membership and attendance count for the purpose of apportionment of
753 state money, except as provided in Subsections (2) through (4).
754 (2) (a) Notwithstanding Section 53F-2-302, foreign exchange students may not be
755 included in average daily membership for the purpose of determining the number of weighted
756 pupil units in the grades 1-12 basic program.
757 (b) Subject to the limitation in Subsection (3), the number of weighted pupil units in
758 the grades 1-12 basic program attributed to foreign exchange students shall be equal to the
759 number of foreign exchange students who were:
760 (i) enrolled in a school district or charter school on October 1 of the previous fiscal
761 year; and
762 (ii) sponsored by an agency approved by the district's local school board or charter
763 school's governing board.
764 (3) (a) The total number of foreign exchange students in the state that may be counted
765 for the purpose of apportioning state money under Subsection (2) shall be the lesser of:
766 (i) the number of foreign exchange students enrolled in public schools in the state on
767 October 1 of the previous fiscal year; or
768 (ii) 328 foreign exchange students.
769 (b) The State Board of Education shall make rules in accordance with Title 63G,
770 Chapter 3, Utah Administrative Rulemaking Act, to administer the cap on the number of
771 foreign exchange students that may be counted for the purpose of apportioning state money
772 under Subsection (2).
773 (4) Notwithstanding [
774 pupil units in the grades 1-12 basic program for foreign exchange students, as determined by
775 Subsections (2) and (3), may not be included for the purposes of determining a school district's
776 state guarantee money under [
777 Section 11. Section 53F-2-312 is amended to read:
778 53F-2-312. Appropriation for class size reduction.
779 (1) Money appropriated to the State Board of Education for class size reduction shall
780 be used to reduce the average class size in kindergarten through the eighth grade in the state's
781 public schools.
782 (2) Each school district or charter school shall receive an allocation based upon the
783 school district or charter school's prior year average daily membership in kindergarten through
784 grade 8 plus growth as determined under Subsection 53F-2-302(3) as compared to the total
785 prior year average daily membership in kindergarten through grade 8 plus growth of school
786 districts and charter schools that qualify for an allocation pursuant to Subsection (8).
787 (3) (a) A local education board may use an allocation to reduce class size in any one or
788 all of the grades referred to under this section, except as otherwise provided in Subsection
789 (3)(b).
790 (b) (i) Each local education board shall use 50% of an allocation to reduce class size in
791 any one or all of grades kindergarten through grade 2, with an emphasis on improving student
792 reading skills.
793 (ii) If a school district's or charter school's average class size is below 18 in grades
794 kindergarten through grade 2, a local education board may petition the State Board of
795 Education for, and the State Board of Education may grant, a waiver to use an allocation under
796 Subsection (3)(b)(i) for class size reduction in the other grades.
797 (4) Schools may use nontraditional innovative and creative methods to reduce class
798 sizes with this appropriation and may use part of an allocation to focus on class size reduction
799 for specific groups, such as at risk students, or for specific blocks of time during the school
800 day.
801 (5) (a) A local education board may use up to 20% of an allocation under Subsection
802 (1) for capital facilities projects if such projects would help to reduce class size.
803 (b) If a school district's or charter school's student population increases by 5% or 700
804 students from the previous school year, the local education board may use up to 50% of any
805 allocation received by the respective school district or charter school under this section for
806 classroom construction.
807 (6) This appropriation is to supplement any other appropriation made for class size
808 reduction.
809 (7) The Legislature shall provide for an annual adjustment in the appropriation
810 authorized under this section in proportion to the increase in the number of students in the state
811 in kindergarten through grade eight.
812 (8) (a) For a school district or charter school to qualify for class size reduction money,
813 a local education board shall submit:
814 (i) a plan for the use of the allocation of class size reduction money to the State Board
815 of Education; and
816 (ii) beginning with the 2014-15 school year, a report on the local education board's use
817 of class size reduction money in the prior school year.
818 (b) The plan and report required pursuant to Subsection (8)(a) shall include the
819 following information:
820 (i) (A) the number of teachers employed using class size reduction money;
821 (B) the amount of class size reduction money expended for teachers; and
822 (C) if supplemental school district or charter school funds are expended to pay for
823 teachers employed using class size reduction money, the amount of the supplemental money;
824 (ii) (A) the number of paraprofessionals employed using class size reduction money;
825 (B) the amount of class size reduction money expended for paraprofessionals; and
826 (C) if supplemental school district or charter school funds are expended to pay for
827 paraprofessionals employed using class size reduction money, the amount of the supplemental
828 money; and
829 (iii) the amount of class size reduction money expended for capital facilities.
830 (c) In addition to submitting a plan and report on the use of class size reduction money,
831 a local education board shall annually submit a report to the State Board of Education that
832 includes the following information:
833 (i) the number of teachers employed using K-3 Reading Improvement Program money
834 received pursuant to [
835 (ii) the amount of K-3 Reading Improvement Program money expended for teachers;
836 (iii) the number of teachers employed in kindergarten through grade 8 using Title I
837 money;
838 (iv) the amount of Title I money expended for teachers in kindergarten through grade
839 8; and
840 (v) a comparison of actual average class size by grade in grades kindergarten through 8
841 in the school district or charter school with what the average class size would be without the
842 expenditure of class size reduction, K-3 Reading Improvement Program, and Title I money.
843 (d) The information required to be reported in Subsections (8)(b)(i)(A) through (C),
844 (8)(b)(ii)(A) through (C), and (8)(c) shall be categorized by a teacher's or paraprofessional's
845 teaching assignment, such as the grade level, course, or subject taught.
846 (e) The State Board of Education may make rules specifying procedures and standards
847 for the submission of:
848 (i) a plan and a report on the use of class size reduction money as required by this
849 section; and
850 (ii) a report required under Subsection (8)(c).
851 (f) Based on the data contained in the class size reduction plans and reports submitted
852 by local education boards, and data on average class size, the State Board of Education shall
853 annually report to the Public Education Appropriations Subcommittee on the impact of class
854 size reduction, K-3 Reading Improvement Program, and Title I money on class size.
855 Section 12. Section 53F-2-503 is amended to read:
856 53F-2-503. K-3 Reading Improvement Program.
857 (1) As used in this section:
858 (a) "Board" means the State Board of Education.
859 (b) "Five domains of reading" include phonological awareness, phonics, fluency,
860 comprehension, and vocabulary.
861 (c) "Program" means the K-3 Reading Improvement Program.
862 (d) "Program money" means:
863 (i) school district revenue allocated to the program from other money available to the
864 school district, except money provided by the state, for the purpose of receiving state funds
865 under this section; and
866 (ii) money appropriated by the Legislature to the program.
867 (2) The K-3 Reading Improvement Program consists of program money and is created
868 to supplement other school resources to achieve the state's goal of having third graders reading
869 at or above grade level.
870 (3) Subject to future budget constraints, the Legislature may annually appropriate
871 money to the K-3 Reading Improvement Program.
872 (4) (a) For a school district or charter school to receive program money, a local
873 education board shall submit a plan to the board for reading proficiency improvement that
874 incorporates the following components:
875 (i) assessment;
876 (ii) intervention strategies;
877 (iii) professional development for classroom teachers in kindergarten through grade
878 three;
879 (iv) reading performance standards; and
880 (v) specific measurable goals that include the following:
881 (A) a growth goal for each school within a school district and each charter school
882 based upon student learning gains as measured by benchmark assessments administered
883 pursuant to Section 53E-4-307; and
884 (B) a growth goal for each school district and charter school to increase the percentage
885 of third grade students who read on grade level from year to year as measured by the third
886 grade reading test administered pursuant to Section 53E-4-302.
887 (b) The board shall provide model plans that a local education board may use, or the
888 local education board may develop the local education board's own plan.
889 (c) Plans developed by a local education board shall be approved by the board.
890 (d) The board shall develop uniform standards for acceptable growth goals that a local
891 education board adopts for a school district or charter school as described in this Subsection
892 (4).
893 (5) (a) There is created within the K-3 Reading Achievement Program three funding
894 programs:
895 (i) the Base Level Program;
896 (ii) the Guarantee Program; and
897 (iii) the Low Income Students Program.
898 (b) The board may use no more than $7,500,000 from an appropriation described in
899 Subsection (3) for computer-assisted instructional learning and assessment programs.
900 (6) Money appropriated to the board for the K-3 Reading Improvement Program and
901 not used by the board for computer-assisted instructional learning and assessments as described
902 in Subsection (5)(b), shall be allocated to the three funding programs as follows:
903 (a) 8% to the Base Level Program;
904 (b) 46% to the Guarantee Program; and
905 (c) 46% to the Low Income Students Program.
906 (7) (a) For a school district or charter school to participate in the Base Level Program,
907 the local education board shall submit a reading proficiency improvement plan to the board as
908 provided in Subsection (4) and must receive approval of the plan from the board.
909 (b) (i) The local school board of a school district qualifying for Base Level Program
910 funds and the governing boards of qualifying elementary charter schools combined shall
911 receive a base amount.
912 (ii) The base amount for the qualifying elementary charter schools combined shall be
913 allocated among each charter school in an amount proportionate to:
914 (A) each existing charter school's prior year fall enrollment in grades kindergarten
915 through grade three; and
916 (B) each new charter school's estimated fall enrollment in grades kindergarten through
917 grade three.
918 (8) (a) A local school board that applies for program money in excess of the Base Level
919 Program funds shall choose to first participate in either the Guarantee Program or the Low
920 Income Students Program.
921 (b) A school district must fully participate in either the Guarantee Program or the Low
922 Income Students Program before the local school board may elect for the school district to
923 either fully or partially participate in the other program.
924 (c) For a school district to fully participate in the Guarantee Program, the local school
925 board shall allocate to the program money available to the school district, except money
926 provided by the state, equal to the amount of revenue that would be generated by a tax rate of
927 .000056.
928 (d) For a school district to fully participate in the Low Income Students Program, the
929 local school board shall allocate to the program money available to the school district, except
930 money provided by the state, equal to the amount of revenue that would be generated by a tax
931 rate of .000065.
932 (e) (i) The board shall verify that a local school board allocates the money required in
933 accordance with Subsections (8)(c) and (d) before the local school board distributes funds in
934 accordance with this section.
935 (ii) The State Tax Commission shall provide the board the information the board needs
936 in order to comply with Subsection (8)(e)(i).
937 (9) (a) Except as provided in Subsection (9)(c), the local school board of a school
938 district that fully participates in the Guarantee Program shall receive state funds in an amount
939 that is:
940 (i) equal to the difference between $21 multiplied by the school district's total WPUs
941 and the revenue the local school board is required to allocate under Subsection (8)(c) for the
942 school district to fully participate in the Guarantee Program; and
943 (ii) not less than $0.
944 (b) Except as provided in Subsection (9)(c), an elementary charter school shall receive
945 under the Guarantee Program an amount equal to $21 times the elementary charter school's
946 total WPUs.
947 (c) The board may adjust the $21 guarantee amount described in Subsections (9)(a) and
948 (b) to account for actual appropriations and money used by the board for computer-assisted
949 instructional learning and assessments.
950 (10) The board shall distribute Low Income Students Program funds in an amount
951 proportionate to the number of students in each school district or charter school who qualify for
952 free or reduced price school lunch multiplied by two.
953 (11) A school district that partially participates in the Guarantee Program or Low
954 Income Students Program shall receive program funds based on the amount of school district
955 revenue allocated to the program as a percentage of the amount of revenue that could have been
956 allocated if the school district had fully participated in the program.
957 (12) (a) A local education board shall use program money for reading proficiency
958 improvement interventions in grades kindergarten through grade 3 that have proven to
959 significantly increase the percentage of students reading at grade level, including:
960 (i) reading assessments; and
961 (ii) focused reading remediations that may include:
962 (A) the use of reading specialists;
963 (B) tutoring;
964 (C) before or after school programs;
965 (D) summer school programs; or
966 (E) the use of reading software; or
967 (F) the use of interactive computer software programs for literacy instruction and
968 assessments for students.
969 (b) A local education board may use program money for portable technology devices
970 used to administer reading assessments.
971 (c) Program money may not be used to supplant funds for existing programs, but may
972 be used to augment existing programs.
973 (13) (a) Each local education board shall annually submit a report to the board
974 accounting for the expenditure of program money in accordance with its plan for reading
975 proficiency improvement.
976 (b) If a local education board uses program money in a manner that is inconsistent with
977 Subsection (12), the school district or charter school is liable for reimbursing the board for the
978 amount of program money improperly used, up to the amount of program money received from
979 the board.
980 (14) (a) The board shall make rules to implement the program.
981 (b) (i) The rules under Subsection (14)(a) shall require each local education board to
982 annually report progress in meeting goals stated in the school district's or charter school's plan
983 for student reading proficiency.
984 (ii) If a school does not meet or exceed the school's goals, the local education board
985 shall prepare a new plan which corrects deficiencies.
986 (iii) The new plan described in Subsection (14)(b)(ii) shall be approved by the board
987 before the local education board receives an allocation for the next year.
988 (15) (a) If for two consecutive school years, a school district fails to meet the school
989 district's goal to increase the percentage of third grade students who read on grade level as
990 measured by the third grade reading test administered pursuant to Section 53E-4-302, the
991 school district [
992 receive money appropriated by the Legislature for the K-3 Reading Improvement Program.
993 (b) If for two consecutive school years, a charter school fails to meet the charter
994 school's goal to increase the percentage of third grade students who read on grade level as
995 measured by the third grade reading test administered pursuant to Section 53E-4-302, the
996 charter school may not receive money appropriated by the Legislature for the K-3 Reading
997 Improvement Program.
998 (16) The board shall make an annual report to the Public Education Appropriations
999 Subcommittee that:
1000 (a) includes information on:
1001 (i) student learning gains in reading for the past school year and the five-year trend;
1002 (ii) the percentage of third grade students reading on grade level in the past school year
1003 and the five-year trend;
1004 (iii) the progress of schools and school districts in meeting goals stated in a school
1005 district's or charter school's plan for student reading proficiency; and
1006 (iv) the correlation between third grade students reading on grade level and results of
1007 third grade language arts scores on a criterion-referenced test or computer adaptive test; and
1008 (b) may include recommendations on how to increase the percentage of third grade
1009 students who read on grade level.
1010 Section 13. Section 53F-2-515 is amended to read:
1011 53F-2-515. Federal Impact Aid Program -- Offset for underestimated allocations
1012 from the Federal Impact Aid Program.
1013 (1) In addition to the revenues received from the levy imposed by a local school board
1014 and authorized by the Legislature under Section 53F-2-301 or 53F-2-301.5, as applicable, the
1015 Legislature shall provide an amount equal to the difference between the school district's
1016 anticipated receipts under the entitlement for the fiscal year from the Federal Impact Aid
1017 Program and the amount the school district actually received from this source for the next
1018 preceding fiscal year.
1019 (2) If at the end of a fiscal year the sum of the receipts of a school district from a
1020 distribution from the Legislature pursuant to Subsection (1) plus the school district's allocations
1021 from the Federal Impact Aid Program for that fiscal year exceeds the amount allocated to the
1022 school district from the Federal Impact Aid Program for the next preceding fiscal year, the
1023 excess funds are carried into the next succeeding fiscal year and become in that year a part of
1024 the school district's contribution to the school district's basic program for operation and
1025 maintenance under the state minimum school finance law.
1026 (3) During the next succeeding fiscal year described in Subsection (2), the school
1027 district's required tax rate for the basic program shall be reduced so that the yield from the
1028 reduced tax rate plus the carryover funds equal the school district's required contribution to the
1029 school district's basic program.
1030 (4) For the school district of a local school board that is required to reduce the school
1031 district's basic tax rate under this section, the school district shall receive state minimum school
1032 program funds as though the reduction in the tax rate had not been made.
1033 Section 14. Section 53F-2-601 is amended to read:
1034 53F-2-601. State guaranteed local levy increments -- Appropriation to increase
1035 number of guaranteed local levy increments -- No effect of change of minimum basic tax
1036 rate -- Voted and board local levy funding balance -- Use of guaranteed local levy
1037 increment funds.
1038 (1) As used in this section[
1039 (a) "Board local levy" means a local levy described in Section 53F-8-302.
1040 (b) "Guaranteed local levy increment" means a local levy increment guaranteed by the
1041 state:
1042 (i) for the board local levy, described in Subsections (2)(a)(ii)(A) and (2)(b)(ii)(B); or
1043 (ii) for the voted local levy, described in Subsections (2)(a)(ii)(B) and (2)(b)(ii)(A).
1044 (c) "Local levy increment" means .0001 per dollar of taxable value.
1045 (d) (i) "Voted and board local levy funding balance" means the difference between:
1046 [
1047 guaranteed local levy increments in a fiscal year; and
1048 [
1049 fund in the same fiscal year the guaranteed local levy increments as determined under this
1050 section [
1051 (ii) "Voted and board local levy funding balance" does not include appropriations
1052 described in Subsection (2)(b)(i).
1053 (e) "Voted local levy" means a local levy described in Section 53F-8-301.
1054 (2) (a) (i) In addition to the revenue collected from the imposition of a [
1055
1056 guarantee that a school district receives, subject to Subsections (2)(b)(ii)(C) and (3)(a), for each
1057 guaranteed local levy increment, an amount sufficient to guarantee [
1058 that begins on July 1, 2018, $43.10 per weighted pupil unit [
1059
1060 [
1061
1062
1063
1064 (ii) Except as provided in Subsection (2)(b)(ii), the number of local levy increments
1065 that are subject to the guarantee amount described in Subsection (2)(a)(i) are:
1066 (A) for a board local levy, the first four local levy increments a local school board
1067 imposes under the board local levy; and
1068 (B) for a voted local levy, the first 16 local levy increments a local school board
1069 imposes under the voted local levy.
1070 (b) (i) Subject to future budget constraints and Subsection (2)(c), the Legislature shall
1071 annually appropriate money from the Local Levy Growth Account established in Section
1072 53F-9-305 for purposes described in Subsection (2)(b)(ii).
1073 (ii) The State Board of Education shall, for a fiscal year beginning on or after July 1,
1074 2018, and subject to Subsection (2)(c), allocate funds appropriated under Subsection (2)(b)(i)
1075 in the following order of priority by increasing:
1076 (A) by up to four increments the number of voted local levy guaranteed local levy
1077 increments above 16;
1078 (B) by up to 16 increments the number of board local levy guaranteed local levy
1079 increments above four; and
1080 (C) the guaranteed amount described in Subsection (2)(a)(i).
1081 (c) The number of guaranteed local levy increments under this Subsection (2) for a
1082 school district may not exceed 20 guaranteed local levy increments, regardless of whether the
1083 guaranteed local levy increments are from the imposition of a voted local levy, a board local
1084 levy, or a combination of the two.
1085 [
1086
1087 (3) (a) The guarantee described in Subsection (2)(a)(i) is indexed each year to the value
1088 of the weighted pupil unit [
1089 guarantee equal to .011962 times the value of the prior year's weighted pupil unit [
1090
1091 (b) The guarantee shall increase by .0005 times the value of the prior year's weighted
1092 pupil unit [
1093 Legislature appropriating funds for an increase in the guarantee.
1094 [
1095 would otherwise be entitled to receive under this section may not be reduced for the sole reason
1096 that the school district's board local levy or voted local levy is reduced as a consequence of
1097 changes in the certified tax rate under Section 59-2-924 pursuant to changes in property
1098 valuation.
1099 (b) Subsection [
1100 change in the certified tax rate as described in Subsection (4)(a).
1101 [
1102 voted local levy rate that exceeds the voted local levy rate that was in effect for the previous
1103 fiscal year, unless an increase in the voted local levy rate was authorized in an election
1104 conducted on or after July 1 of the previous fiscal year and before December 2 of the previous
1105 fiscal year.
1106 [
1107 year, the State Board of Education shall:
1108 (i) use the voted and board local levy funding balance to increase the value of the state
1109 guarantee per weighted pupil unit described in Subsection [
1110 and
1111 (ii) distribute [
1112 guaranteed local levy increment funds to school districts based on the increased value of the
1113 state guarantee per weighted pupil unit described in Subsection [
1114 (b) The State Board of Education shall report action taken under [
1115 (6)(a) to the Office of the Legislative Fiscal Analyst and the Governor's Office of Management
1116 and Budget.
1117 (7) A local school board of a school district that receives funds described in this section
1118 shall budget and expend the funds for public education purposes.
1119 Section 15. Section 53F-2-704 is amended to read:
1120 53F-2-704. Charter school levy state guarantee.
1121 (1) As used in this section:
1122 (a) "Charter school levy per pupil revenues" means the same as that term is defined in
1123 Section 53F-2-703.
1124 (b) "Charter school students' average local revenues" means the amount determined as
1125 follows:
1126 (i) for each student enrolled in a charter school on the previous October 1, calculate the
1127 district per pupil local revenues of the school district in which the student resides;
1128 (ii) sum the district per pupil local revenues for each student enrolled in a charter
1129 school on the previous October 1; and
1130 (iii) divide the sum calculated under Subsection (1)(a)(ii) by the number of students
1131 enrolled in charter schools on the previous October 1.
1132 (c) "District local property tax revenues" means the sum of a school district's revenue
1133 received from the following:
1134 (i) a voted local levy imposed under Section 53F-8-301;
1135 (ii) a board local levy imposed under Section 53F-8-302, excluding revenues expended
1136 for:
1137 (A) pupil transportation, up to the amount of revenue generated by a .0003 per dollar of
1138 taxable value of the school district's board local levy; and
1139 (B) the K-3 Reading Improvement Program, up to the amount of revenue generated by
1140 a .000121 per dollar of taxable value of the school district's board local levy;
1141 (iii) a capital local levy imposed under Section 53F-8-303; and
1142 (iv) a guarantee described in Section 53F-2-601, [
1143 53F-3-203.
1144 (d) "District per pupil local revenues" means, using data from the most recently
1145 published school district annual financial reports and state superintendent's annual report, an
1146 amount equal to district local property tax revenues divided by the sum of:
1147 (i) a school district's average daily membership; and
1148 (ii) the average daily membership of a school district's resident students who attend
1149 charter schools.
1150 (e) "Resident student" means a student who is considered a resident of the school
1151 district under Title 53G, Chapter 6, Part 3, School District Residency.
1152 (f) "Statewide average debt service revenues" means the amount determined as
1153 follows, using data from the most recently published state superintendent's annual report:
1154 (i) sum the revenues of each school district from the debt service levy imposed under
1155 Section 11-14-310; and
1156 (ii) divide the sum calculated under Subsection (1)(f)(i) by statewide school district
1157 average daily membership.
1158 (2) (a) Subject to future budget constraints, the Legislature shall provide an
1159 appropriation for charter schools for each charter school student enrolled on October 1 to
1160 supplement the allocation of charter school levy per pupil revenues described in Subsection
1161 53F-2-702(3)(a).
1162 (b) Except as provided in Subsection (2)(c), the amount of money provided by the state
1163 for a charter school student shall be the sum of:
1164 (i) charter school students' average local revenues minus the charter school levy per
1165 pupil revenues; and
1166 (ii) statewide average debt service revenues.
1167 (c) If the total of charter school levy per pupil revenues distributed by the State Board
1168 of Education and the amount provided by the state under Subsection (2)(b) is less than $1,427,
1169 the state shall provide an additional supplement so that a charter school receives at least $1,427
1170 per student under Subsection 53F-2-702(3).
1171 (d) (i) If the appropriation provided under this Subsection (2) is less than the amount
1172 prescribed by Subsection (2)(b) or (c), the appropriation shall be allocated among charter
1173 schools in proportion to each charter school's enrollment as a percentage of the total enrollment
1174 in charter schools.
1175 (ii) If the State Board of Education makes adjustments to Minimum School Program
1176 allocations as provided under Section 53F-2-205, the allocation provided in Subsection
1177 (2)(d)(i) shall be determined after adjustments are made under Section 53F-2-205.
1178 (3) (a) Except as provided in Subsection (3)(b), of the money provided to a charter
1179 school under Subsection 53F-2-702(3), 10% shall be expended for funding school facilities
1180 only.
1181 (b) Subsection (3)(a) does not apply to an online charter school.
1182 Section 16. Section 53F-3-102 is amended to read:
1183 53F-3-102. Definitions.
1184 As used in this chapter:
1185 (1) "ADM" or "pupil in average daily membership" is as defined in Section 53F-2-102.
1186 (2) "Base tax effort rate" means the average of:
1187 (a) the highest combined capital levy rate; and
1188 (b) the average combined capital levy rate for the school districts statewide.
1189 (3) "Combined capital levy rate" means a rate that includes the sum of the following
1190 property tax levies:
1191 [
1192 [
1193
1194 [
1195 [
1196 (b) (i) the capital local levy authorized in Section 53F-8-303; and
1197 (ii) the debt service levy authorized in Section 11-14-310.
1198 (4) "Derived net taxable value" means the quotient of:
1199 (a) the total property tax collections from April 1 through the following March 31 for a
1200 school district for the calendar year preceding the March 31 date; divided by
1201 (b) the school district's total tax rate for the calendar year preceding the March 31
1202 referenced in Subsection (4)(a).
1203 (5) "Highest combined capital levy rate" means the highest combined capital levy rate
1204 imposed by a school district within the state for a fiscal year.
1205 (6) "Property tax base per ADM" means the quotient of:
1206 (a) a school district's derived net taxable value; divided by
1207 (b) the school district's ADM.
1208 (7) "Property tax yield per ADM" means:
1209 (a) the product of:
1210 (i) a school district's derived net taxable value; and
1211 (ii) the base tax effort rate; divided by
1212 (b) the school district's ADM.
1213 (8) "Statewide average property tax base per ADM" means the quotient of:
1214 (a) the sum of all school districts' derived net taxable value; divided by
1215 (b) the sum of all school districts' ADM.
1216 Section 17. Section 53F-8-302 is amended to read:
1217 53F-8-302. Board local levy.
1218 (1) The terms defined in Section 53F-2-102 apply to this section.
1219 (2) Subject to the other requirements of this section, [
1220
1221 general fund.
1222 (3) (a) For purposes of this Subsection (3), "combined rate" means the sum of:
1223 (i) the rate imposed by a local school board under Subsection (2); and
1224 (ii) the charter school levy rate, described in Section 53F-2-703, for the local school
1225 board's school district.
1226 [
1227
1228 [
1229 not exceed .0025 per dollar of taxable value in any calendar year [
1230
1231
1232 [
1233 [
1234 [
1235 [
1236 [
1237
1238 [
1239 [
1240 (4) In addition to the revenue a school district collects from the imposition of a levy
1241 pursuant to this section, the state shall contribute an amount as described in Section
1242 [
1243 (5) (a) For a calendar year beginning on or after January 1, 2017, the State Tax
1244 Commission shall adjust a board local levy rate imposed by a local school board under this
1245 section by the amount necessary to offset the change in revenues from the charter school levy
1246 imposed under Section 53F-2-703.
1247 (b) A local school board is not required to comply with the notice and public hearing
1248 requirements of Section 59-2-919 for an offset described in Subsection (5)(a) to the change in
1249 revenues from the charter school levy imposed under Section 53F-2-703.
1250 [
1251
1252
1253 [
1254 school levy per district revenues, a local school board may not increase a board local levy rate
1255 under this section if the purpose of increasing the board local levy rate is to capture the
1256 revenues assigned to the charter school levy through the adjustment in a board local levy rate
1257 under Subsection (5)(a).
1258 [
1259 under this section, the local school board shall:
1260 (i) prepare a written statement that attests that the local school board is in compliance
1261 with Subsection (5)[
1262 (ii) read the statement described in Subsection (5)[
1263 public meeting where the local school board discusses increasing the board local levy rate; and
1264 (iii) send a copy of the statement described in Subsection (5)[
1265 Commission.
1266 Section 18. Section 53F-8-303 is amended to read:
1267 53F-8-303. Capital local levy.
1268 (1) [
1269 a tax to fund the school district's capital projects.
1270 [
1271 .0030 per dollar of taxable value in any calendar year.
1272 [
1273
1274
1275
1276 [
1277
1278 [
1279 [
1280
1281 [
1282 [
1283
1284
1285
1286 [
1287
1288
1289 [
1290
1291 [
1292 [
1293
1294
1295
1296 [
1297 [
1298 Section 19. Section 53F-8-402 is amended to read:
1299 53F-8-402. Special tax to buy school building sites, build and furnish
1300 schoolhouses, or improve school property.
1301 (1) (a) Except as provided in Subsection (6), a local school board may, by following
1302 the process for special elections established in Sections 20A-1-203 and 20A-1-204, call a
1303 special election to determine whether a special property tax should be levied for one or more
1304 years to buy building sites, build and furnish schoolhouses, or improve the school property
1305 under its control.
1306 (b) The tax may not exceed .2% of the taxable value of all taxable property in the
1307 district in any one year.
1308 (2) The board shall give reasonable notice of the election and follow the same
1309 procedure used in elections for the issuance of bonds.
1310 (3) If a majority of those voting on the proposition vote in favor of the tax, it is [
1311
1312 county assessment roll for that year.
1313 (4) (a) Within 20 days after the election, the board shall certify the amount of the
1314 approved tax to the governing body of the county in which the school district is located.
1315 (b) The governing body shall acknowledge receipt of the certification and levy and
1316 collect the special tax.
1317 (c) It shall then distribute the collected taxes to the business administrator of the school
1318 district at the end of each calendar month.
1319 (5) The special tax becomes due and delinquent and attaches to and becomes a lien on
1320 real and personal property at the same time as state and county taxes.
1321 (6) Notwithstanding Subsections (3) and (4), beginning January 1, 2012, a local school
1322 board may not levy a tax in accordance with this section.
1323 Section 20. Section 53F-9-302 is amended to read:
1324 53F-9-302. Minimum Basic Growth Account.
1325 (1) As used in this section, "account" means the Minimum Basic Growth Account
1326 created in this section.
1327 (2) There is created within the Education Fund a restricted account known as the
1328 "Minimum Basic Growth Account."
1329 (3) The account shall be funded by amounts deposited into the account in accordance
1330 with Section 53F-2-301 or 53F-2-301.5, as applicable.
1331 (4) The account shall earn interest.
1332 (5) Interest earned on the account shall be deposited into the account.
1333 (6) Upon appropriation by the Legislature:
1334 (a) 75% of the money from the account shall be used to fund the state's contribution to
1335 the voted local levy guarantee described in Section 53F-2-601;
1336 (b) 20% of the money from the account shall be used to fund the Capital Outlay
1337 Foundation Program as provided in Section 53F-3-203; and
1338 (c) 5% of the money from the account shall be used to fund the Capital Outlay
1339 Enrollment Growth Program as provided in Section 53F-3-203.
1340 Section 21. Section 53F-9-305 is enacted to read:
1341 53F-9-305. Local Levy Growth Account.
1342 (1) As used in this section, "account" means the Local Levy Growth Account created in
1343 this section.
1344 (2) There is created within the Education Fund a restricted account known as the
1345 "Local Levy Growth Account."
1346 (3) The account shall be funded by:
1347 (a) amounts deposited into the account in accordance with Section 53F-2-301 or
1348 53F-2-301.5, as applicable; and
1349 (b) other legislative appropriations.
1350 (4) The account shall earn interest.
1351 (5) Interest earned on the account shall be deposited into the account.
1352 (6) The Legislature shall appropriate money in the account to the State Board of
1353 Education.
1354 Section 22. Section 53F-9-306 is enacted to read:
1355 53F-9-306. Teacher and Student Success Account.
1356 (1) As used in this section, "account" means the Teacher and Student Success Account
1357 created in this section.
1358 (2) There is created within the Education Fund a restricted account known as the
1359 "Teacher and Student Success Account."
1360 (3) The account shall be funded by:
1361 (a) amounts deposited into the account in accordance with Section 53F-2-301 or
1362 53F-2-301.5, as applicable; and
1363 (b) other legislative appropriations.
1364 (4) The account shall earn interest.
1365 (5) Interest earned on the account shall be deposited into the account.
1366 (6) The Legislature shall appropriate money in the account to the State Board of
1367 Education.
1368 Section 23. Section 53G-3-304 is amended to read:
1369 53G-3-304. Property tax levies in new district and remaining district --
1370 Distribution of property tax revenue.
1371 (1) Notwithstanding terms defined in Section 53G-3-102, as used in this section:
1372 (a) "Divided school district" or "existing district" means a school district from which a
1373 new district is created.
1374 (b) "New district" means a school district created under Section 53G-3-302 after May
1375 10, 2011.
1376 (c) "Property tax levy" means a property tax levy that a school district is authorized to
1377 impose, except:
1378 (i) the minimum basic tax rate imposed under Section 53F-2-301 or 53F-2-301.5, as
1379 applicable;
1380 (ii) a debt service levy imposed under Section 11-14-310; or
1381 (iii) a judgment levy imposed under Section 59-2-1330.
1382 (d) "Qualifying taxable year" means the calendar year in which a new district begins to
1383 provide educational services.
1384 (e) "Remaining district" means an existing district after the creation of a new district.
1385 (2) A new district and remaining district shall continue to impose property tax levies
1386 that were imposed by the divided school district in the taxable year prior to the qualifying
1387 taxable year.
1388 (3) Except as provided in Subsection (6), a property tax levy that a new district and
1389 remaining district are required to impose under Subsection (2) shall be set at a rate that:
1390 (a) is uniform in the new district and remaining district; and
1391 (b) generates the same amount of revenue that was generated by the property tax levy
1392 within the divided school district in the taxable year prior to the qualifying taxable year.
1393 (4) [
1394 county in which a property tax levy is imposed under Subsection (2) shall distribute revenues
1395 generated by the property tax levy to the new district and remaining district in proportion to the
1396 percentage of the divided school district's enrollment on the October 1 prior to the new district
1397 commencing educational services that were enrolled in schools currently located in the new
1398 district or remaining district.
1399 [
1400
1401
1402
1403 (5) On or before March 31, a county treasurer shall distribute revenues generated by a
1404 property tax levy imposed under Subsection (2) in the prior calendar year to a new district and
1405 remaining district as provided in Subsection (4).
1406 (6) (a) Subject to the notice and public hearing requirements of Section 59-2-919, a
1407 new district or remaining district may set a property tax rate higher than the rate required by
1408 Subsection (3), up to:
1409 (i) the maximum rate, if any, allowed by law; or
1410 (ii) the maximum rate authorized by voters for a voted local levy under Section
1411 53F-8-301.
1412 (b) The revenues generated by the portion of a property tax rate in excess of the rate
1413 required by Subsection (3) shall be retained by the district that imposes the higher rate.
1414 Section 24. Section 53G-6-705 is amended to read:
1415 53G-6-705. Online students' participation in extracurricular activities.
1416 (1) As used in this section:
1417 (a) "Online education" means the use of information and communication technologies
1418 to deliver educational opportunities to a student in a location other than a school.
1419 (b) "Online student" means a student who:
1420 (i) participates in an online education program sponsored or supported by the State
1421 Board of Education, a school district, or charter school; and
1422 (ii) generates funding for the school district or school pursuant to Subsection
1423 53F-2-102[
1424 (2) An online student is eligible to participate in extracurricular activities at:
1425 (a) the school within whose attendance boundaries the student's custodial parent or
1426 legal guardian resides; or
1427 (b) the public school from which the student withdrew for the purpose of participating
1428 in an online education program.
1429 (3) A school other than a school described in Subsection (2)(a) or (b) may allow an
1430 online student to participate in extracurricular activities other than:
1431 (a) interschool competitions of athletic teams sponsored and supported by a public
1432 school; or
1433 (b) interschool contests or competitions for music, drama, or forensic groups or teams
1434 sponsored and supported by a public school.
1435 (4) An online student is eligible for extracurricular activities at a public school
1436 consistent with eligibility standards as applied to full-time students of the public school.
1437 (5) A school district or public school may not impose additional requirements on an
1438 online school student to participate in extracurricular activities that are not imposed on
1439 full-time students of the public school.
1440 (6) (a) The State Board of Education shall make rules establishing fees for an online
1441 school student's participation in extracurricular activities at school district schools.
1442 (b) The rules shall provide that:
1443 (i) online school students pay the same fees as other students to participate in
1444 extracurricular activities;
1445 (ii) online school students are eligible for fee waivers pursuant to Section 53G-7-504;
1446 (iii) for each online school student who participates in an extracurricular activity at a
1447 school district school, the online school shall pay a share of the school district's costs for the
1448 extracurricular activity; and
1449 (iv) an online school's share of the costs of an extracurricular activity shall reflect state
1450 and local tax revenues expended, except capital facilities expenditures, for an extracurricular
1451 activity in a school district or school divided by total student enrollment of the school district
1452 or school.
1453 (c) In determining an online school's share of the costs of an extracurricular activity
1454 under Subsections (6)(b)(iii) and (iv), the State Board of Education may establish uniform fees
1455 statewide based on average costs statewide or average costs within a sample of school districts.
1456 (7) When selection to participate in an extracurricular activity at a public school is
1457 made on a competitive basis, an online student is eligible to try out for and participate in the
1458 activity as provided in this section.
1459 Section 25. Section 59-1-102 is enacted to read:
1460 59-1-102. Study of Public Law 115-97, Tax Cuts and Jobs Act.
1461 On or before November 30, 2018, the Revenue and Taxation Interim Committee:
1462 (1) shall study the effect of Public Law 115-97, Tax Cuts and Jobs Act, on the personal
1463 exemptions and standard deduction recognized in this title; and
1464 (2) may make recommendations regarding changes to this title resulting from the study
1465 described in Subsection (1) .
1466 Section 26. Section 59-2-102 is amended to read:
1467 59-2-102. Definitions.
1468 As used in this chapter and title:
1469 (1) "Aerial applicator" means aircraft or rotorcraft used exclusively for the purpose of
1470 engaging in dispensing activities directly affecting agriculture or horticulture with an
1471 airworthiness certificate from the Federal Aviation Administration certifying the aircraft or
1472 rotorcraft's use for agricultural and pest control purposes.
1473 (2) "Air charter service" means an air carrier operation that requires the customer to
1474 hire an entire aircraft rather than book passage in whatever capacity is available on a scheduled
1475 trip.
1476 (3) "Air contract service" means an air carrier operation available only to customers
1477 that engage the services of the carrier through a contractual agreement and excess capacity on
1478 any trip and is not available to the public at large.
1479 (4) "Aircraft" means the same as that term is defined in Section 72-10-102.
1480 (5) (a) Except as provided in Subsection (5)(b), "airline" means an air carrier that:
1481 (i) operates:
1482 (A) on an interstate route; and
1483 (B) on a scheduled basis; and
1484 (ii) offers to fly one or more passengers or cargo on the basis of available capacity on a
1485 regularly scheduled route.
1486 (b) "Airline" does not include an:
1487 (i) air charter service; or
1488 (ii) air contract service.
1489 (6) "Assessment roll" means a permanent record of the assessment of property as
1490 assessed by the county assessor and the commission and may be maintained manually or as a
1491 computerized file as a consolidated record or as multiple records by type, classification, or
1492 categories.
1493 (7) "Base parcel" means a parcel of property that was legally:
1494 (a) subdivided into two or more lots, parcels, or other divisions of land; or
1495 (b) (i) combined with one or more other parcels of property; and
1496 (ii) subdivided into two or more lots, parcels, or other divisions of land.
1497 (8) (a) "Certified revenue levy" means a property tax levy that provides an amount of
1498 ad valorem property tax revenue equal to the sum of:
1499 (i) the amount of ad valorem property tax revenue to be generated statewide in the
1500 previous year from imposing a [
1501
1502 and
1503 (ii) the product of:
1504 (A) eligible new growth, as defined in Section 59-2-924; and
1505 (B) the [
1506 certified by the commission for the previous year.
1507 (b) For purposes of this Subsection (8), "ad valorem property tax revenue" does not
1508 include property tax revenue received by a taxing entity from personal property that is:
1509 (i) assessed by a county assessor in accordance with Part 3, County Assessment; and
1510 (ii) semiconductor manufacturing equipment.
1511 (c) For purposes of calculating the certified revenue levy described in this Subsection
1512 (8), the commission shall use:
1513 (i) the taxable value of real property assessed by a county assessor contained on the
1514 assessment roll;
1515 (ii) the taxable value of real and personal property assessed by the commission; and
1516 (iii) the taxable year end value of personal property assessed by a county assessor
1517 contained on the prior year's assessment roll.
1518 (9) "County-assessed commercial vehicle" means:
1519 (a) any commercial vehicle, trailer, or semitrailer that is not apportioned under Section
1520 41-1a-301 and is not operated interstate to transport the vehicle owner's goods or property in
1521 furtherance of the owner's commercial enterprise;
1522 (b) any passenger vehicle owned by a business and used by its employees for
1523 transportation as a company car or vanpool vehicle; and
1524 (c) vehicles that are:
1525 (i) especially constructed for towing or wrecking, and that are not otherwise used to
1526 transport goods, merchandise, or people for compensation;
1527 (ii) used or licensed as taxicabs or limousines;
1528 (iii) used as rental passenger cars, travel trailers, or motor homes;
1529 (iv) used or licensed in this state for use as ambulances or hearses;
1530 (v) especially designed and used for garbage and rubbish collection; or
1531 (vi) used exclusively to transport students or their instructors to or from any private,
1532 public, or religious school or school activities.
1533 (10) (a) Except as provided in Subsection (10)(b), for purposes of Section 59-2-801,
1534 "designated tax area" means a tax area created by the overlapping boundaries of only the
1535 following taxing entities:
1536 (i) a county; and
1537 (ii) a school district.
1538 (b) "Designated tax area" includes a tax area created by the overlapping boundaries of
1539 the taxing entities described in Subsection (10)(a) and:
1540 (i) a city or town if the boundaries of the school district under Subsection (10)(a) and
1541 the boundaries of the city or town are identical; or
1542 (ii) a special service district if the boundaries of the school district under Subsection
1543 (10)(a) are located entirely within the special service district.
1544 (11) "Eligible judgment" means a final and unappealable judgment or order under
1545 Section 59-2-1330:
1546 (a) that became a final and unappealable judgment or order no more than 14 months
1547 before the day on which the notice described in Section 59-2-919.1 is required to be provided;
1548 and
1549 (b) for which a taxing entity's share of the final and unappealable judgment or order is
1550 greater than or equal to the lesser of:
1551 (i) $5,000; or
1552 (ii) 2.5% of the total ad valorem property taxes collected by the taxing entity in the
1553 previous fiscal year.
1554 (12) (a) "Escaped property" means any property, whether personal, land, or any
1555 improvements to the property, that is subject to taxation and is:
1556 (i) inadvertently omitted from the tax rolls, assigned to the incorrect parcel, or assessed
1557 to the wrong taxpayer by the assessing authority;
1558 (ii) undervalued or omitted from the tax rolls because of the failure of the taxpayer to
1559 comply with the reporting requirements of this chapter; or
1560 (iii) undervalued because of errors made by the assessing authority based upon
1561 incomplete or erroneous information furnished by the taxpayer.
1562 (b) "Escaped property" does not include property that is undervalued because of the use
1563 of a different valuation methodology or because of a different application of the same valuation
1564 methodology.
1565 (13) "Fair market value" means the amount at which property would change hands
1566 between a willing buyer and a willing seller, neither being under any compulsion to buy or sell
1567 and both having reasonable knowledge of the relevant facts. For purposes of taxation, "fair
1568 market value" shall be determined using the current zoning laws applicable to the property in
1569 question, except in cases where there is a reasonable probability of a change in the zoning laws
1570 affecting that property in the tax year in question and the change would have an appreciable
1571 influence upon the value.
1572 (14) (a) "Farm machinery and equipment," for purposes of the exemption provided
1573 under Section 59-2-1101, means tractors, milking equipment and storage and cooling facilities,
1574 feed handling equipment, irrigation equipment, harvesters, choppers, grain drills and planters,
1575 tillage tools, scales, combines, spreaders, sprayers, haying equipment, including balers and
1576 cubers, and any other machinery or equipment used primarily for agricultural purposes.
1577 (b) "Farm machinery and equipment" does not include vehicles required to be
1578 registered with the Motor Vehicle Division or vehicles or other equipment used for business
1579 purposes other than farming.
1580 (15) "Geothermal fluid" means water in any form at temperatures greater than 120
1581 degrees centigrade naturally present in a geothermal system.
1582 (16) "Geothermal resource" means:
1583 (a) the natural heat of the earth at temperatures greater than 120 degrees centigrade;
1584 and
1585 (b) the energy, in whatever form, including pressure, present in, resulting from, created
1586 by, or which may be extracted from that natural heat, directly or through a material medium.
1587 (17) (a) "Goodwill" means:
1588 (i) acquired goodwill that is reported as goodwill on the books and records that a
1589 taxpayer maintains for financial reporting purposes; or
1590 (ii) the ability of a business to:
1591 (A) generate income that exceeds a normal rate of return on assets and that results from
1592 a factor described in Subsection (17)(b); or
1593 (B) obtain an economic or competitive advantage resulting from a factor described in
1594 Subsection (17)(b).
1595 (b) The following factors apply to Subsection (17)(a)(ii):
1596 (i) superior management skills;
1597 (ii) reputation;
1598 (iii) customer relationships;
1599 (iv) patronage; or
1600 (v) a factor similar to Subsections (17)(b)(i) through (iv).
1601 (c) "Goodwill" does not include:
1602 (i) the intangible property described in Subsection (21)(a) or (b);
1603 (ii) locational attributes of real property, including:
1604 (A) zoning;
1605 (B) location;
1606 (C) view;
1607 (D) a geographic feature;
1608 (E) an easement;
1609 (F) a covenant;
1610 (G) proximity to raw materials;
1611 (H) the condition of surrounding property; or
1612 (I) proximity to markets;
1613 (iii) value attributable to the identification of an improvement to real property,
1614 including:
1615 (A) reputation of the designer, builder, or architect of the improvement;
1616 (B) a name given to, or associated with, the improvement; or
1617 (C) the historic significance of an improvement; or
1618 (iv) the enhancement or assemblage value specifically attributable to the interrelation
1619 of the existing tangible property in place working together as a unit.
1620 (18) "Governing body" means:
1621 (a) for a county, city, or town, the legislative body of the county, city, or town;
1622 (b) for a local district under Title 17B, Limited Purpose Local Government Entities -
1623 Local Districts, the local district's board of trustees;
1624 (c) for a school district, the local board of education; or
1625 (d) for a special service district under Title 17D, Chapter 1, Special Service District
1626 Act:
1627 (i) the legislative body of the county or municipality that created the special service
1628 district, to the extent that the county or municipal legislative body has not delegated authority
1629 to an administrative control board established under Section 17D-1-301; or
1630 (ii) the administrative control board, to the extent that the county or municipal
1631 legislative body has delegated authority to an administrative control board established under
1632 Section 17D-1-301.
1633 (19) (a) For purposes of Section 59-2-103:
1634 (i) "household" means the association of individuals who live in the same dwelling,
1635 sharing its furnishings, facilities, accommodations, and expenses; and
1636 (ii) "household" includes married individuals, who are not legally separated, that have
1637 established domiciles at separate locations within the state.
1638 (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1639 commission may make rules defining the term "domicile."
1640 (20) (a) Except as provided in Subsection (20)(c), "improvement" means a building,
1641 structure, fixture, fence, or other item that is permanently attached to land, regardless of
1642 whether the title has been acquired to the land, if:
1643 (i) (A) attachment to land is essential to the operation or use of the item; and
1644 (B) the manner of attachment to land suggests that the item will remain attached to the
1645 land in the same place over the useful life of the item; or
1646 (ii) removal of the item would:
1647 (A) cause substantial damage to the item; or
1648 (B) require substantial alteration or repair of a structure to which the item is attached.
1649 (b) "Improvement" includes:
1650 (i) an accessory to an item described in Subsection (20)(a) if the accessory is:
1651 (A) essential to the operation of the item described in Subsection (20)(a); and
1652 (B) installed solely to serve the operation of the item described in Subsection (20)(a);
1653 and
1654 (ii) an item described in Subsection (20)(a) that is temporarily detached from the land
1655 for repairs and remains located on the land.
1656 (c) "Improvement" does not include:
1657 (i) an item considered to be personal property pursuant to rules made in accordance
1658 with Section 59-2-107;
1659 (ii) a moveable item that is attached to land for stability only or for an obvious
1660 temporary purpose;
1661 (iii) (A) manufacturing equipment and machinery; or
1662 (B) essential accessories to manufacturing equipment and machinery;
1663 (iv) an item attached to the land in a manner that facilitates removal without substantial
1664 damage to the land or the item; or
1665 (v) a transportable factory-built housing unit as defined in Section 59-2-1502 if that
1666 transportable factory-built housing unit is considered to be personal property under Section
1667 59-2-1503.
1668 (21) "Intangible property" means:
1669 (a) property that is capable of private ownership separate from tangible property,
1670 including:
1671 (i) money;
1672 (ii) credits;
1673 (iii) bonds;
1674 (iv) stocks;
1675 (v) representative property;
1676 (vi) franchises;
1677 (vii) licenses;
1678 (viii) trade names;
1679 (ix) copyrights; and
1680 (x) patents;
1681 (b) a low-income housing tax credit;
1682 (c) goodwill; or
1683 (d) a renewable energy tax credit or incentive, including:
1684 (i) a federal renewable energy production tax credit under Section 45, Internal Revenue
1685 Code;
1686 (ii) a federal energy credit for qualified renewable electricity production facilities under
1687 Section 48, Internal Revenue Code;
1688 (iii) a federal grant for a renewable energy property under American Recovery and
1689 Reinvestment Act of 2009, Pub. L. No. 111-5, Section 1603; and
1690 (iv) a tax credit under Subsection 59-7-614(5).
1691 (22) "Livestock" means:
1692 (a) a domestic animal;
1693 (b) a fish;
1694 (c) a fur-bearing animal;
1695 (d) a honeybee; or
1696 (e) poultry.
1697 (23) "Low-income housing tax credit" means:
1698 (a) a federal low-income housing tax credit under Section 42, Internal Revenue Code;
1699 or
1700 (b) a low-income housing tax credit under Section 59-7-607 or Section 59-10-1010.
1701 (24) "Metalliferous minerals" includes gold, silver, copper, lead, zinc, and uranium.
1702 (25) "Mine" means a natural deposit of either metalliferous or nonmetalliferous
1703 valuable mineral.
1704 (26) "Mining" means the process of producing, extracting, leaching, evaporating, or
1705 otherwise removing a mineral from a mine.
1706 (27) (a) "Mobile flight equipment" means tangible personal property that is owned or
1707 operated by an air charter service, air contract service, or airline and:
1708 (i) is capable of flight or is attached to an aircraft that is capable of flight; or
1709 (ii) is contained in an aircraft that is capable of flight if the tangible personal property
1710 is intended to be used:
1711 (A) during multiple flights;
1712 (B) during a takeoff, flight, or landing; and
1713 (C) as a service provided by an air charter service, air contract service, or airline.
1714 (b) (i) "Mobile flight equipment" does not include a spare part other than a spare
1715 engine that is rotated at regular intervals with an engine that is attached to the aircraft.
1716 (ii) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1717 commission may make rules defining the term "regular intervals."
1718 (28) "Nonmetalliferous minerals" includes, but is not limited to, oil, gas, coal, salts,
1719 sand, rock, gravel, and all carboniferous materials.
1720 (29) "Part-year residential property" means property that is not residential property on
1721 January 1 of a calendar year but becomes residential property after January 1 of the calendar
1722 year.
1723 (30) "Personal property" includes:
1724 (a) every class of property as defined in Subsection (31) that is the subject of
1725 ownership and is not real estate or an improvement;
1726 (b) any pipe laid in or affixed to land whether or not the ownership of the pipe is
1727 separate from the ownership of the underlying land, even if the pipe meets the definition of an
1728 improvement;
1729 (c) bridges and ferries;
1730 (d) livestock; and
1731 (e) outdoor advertising structures as defined in Section 72-7-502.
1732 (31) (a) "Property" means property that is subject to assessment and taxation according
1733 to its value.
1734 (b) "Property" does not include intangible property as defined in this section.
1735 (32) "Public utility" means:
1736 (a) for purposes of this chapter, the operating property of a railroad, gas corporation, oil
1737 or gas transportation or pipeline company, coal slurry pipeline company, electrical corporation,
1738 telephone corporation, sewerage corporation, or heat corporation where the company performs
1739 the service for, or delivers the commodity to, the public generally or companies serving the
1740 public generally, or in the case of a gas corporation or an electrical corporation, where the gas
1741 or electricity is sold or furnished to any member or consumers within the state for domestic,
1742 commercial, or industrial use; and
1743 (b) the operating property of any entity or person defined under Section 54-2-1 except
1744 water corporations.
1745 (33) (a) Subject to Subsection (33)(b), "qualifying exempt primary residential rental
1746 personal property" means household furnishings, furniture, and equipment that:
1747 (i) are used exclusively within a dwelling unit that is the primary residence of a tenant;
1748 (ii) are owned by the owner of the dwelling unit that is the primary residence of a
1749 tenant; and
1750 (iii) after applying the residential exemption described in Section 59-2-103, are exempt
1751 from taxation under this chapter in accordance with Subsection 59-2-1115(2).
1752 (b) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1753 commission may by rule define the term "dwelling unit" for purposes of this Subsection (33)
1754 and Subsection (36).
1755 (34) "Real estate" or "real property" includes:
1756 (a) the possession of, claim to, ownership of, or right to the possession of land;
1757 (b) all mines, minerals, and quarries in and under the land, all timber belonging to
1758 individuals or corporations growing or being on the lands of this state or the United States, and
1759 all rights and privileges appertaining to these; and
1760 (c) improvements.
1761 (35) (a) "Relationship with an owner of the property's land surface rights" means a
1762 relationship described in Subsection 267(b), Internal Revenue Code, except that the term 25%
1763 shall be substituted for the term 50% in Subsection 267(b), Internal Revenue Code.
1764 (b) For purposes of determining if a relationship described in Subsection 267(b),
1765 Internal Revenue Code, exists, the ownership of stock shall be determined using the ownership
1766 rules in Subsection 267(c), Internal Revenue Code.
1767 (36) (a) Subject to Subsection (36)(b), "residential property," for purposes of the
1768 reductions and adjustments under this chapter, means any property used for residential
1769 purposes as a primary residence.
1770 (b) Subject to Subsection (36)(c), "residential property":
1771 (i) except as provided in Subsection (36)(b)(ii), includes household furnishings,
1772 furniture, and equipment if the household furnishings, furniture, and equipment are:
1773 (A) used exclusively within a dwelling unit that is the primary residence of a tenant;
1774 and
1775 (B) owned by the owner of the dwelling unit that is the primary residence of a tenant;
1776 and
1777 (ii) does not include property used for transient residential use.
1778 (c) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
1779 commission may by rule define the term "dwelling unit" for purposes of Subsection (33) and
1780 this Subsection (36).
1781 (37) "Split estate mineral rights owner" means a person that:
1782 (a) has a legal right to extract a mineral from property;
1783 (b) does not hold more than a 25% interest in:
1784 (i) the land surface rights of the property where the wellhead is located; or
1785 (ii) an entity with an ownership interest in the land surface rights of the property where
1786 the wellhead is located;
1787 (c) is not an entity in which the owner of the land surface rights of the property where
1788 the wellhead is located holds more than a 25% interest; and
1789 (d) does not have a relationship with an owner of the land surface rights of the property
1790 where the wellhead is located.
1791 (38) (a) "State-assessed commercial vehicle" means:
1792 (i) any commercial vehicle, trailer, or semitrailer that operates interstate or intrastate to
1793 transport passengers, freight, merchandise, or other property for hire; or
1794 (ii) any commercial vehicle, trailer, or semitrailer that operates interstate and transports
1795 the vehicle owner's goods or property in furtherance of the owner's commercial enterprise.
1796 (b) "State-assessed commercial vehicle" does not include vehicles used for hire that are
1797 specified in Subsection (9)(c) as county-assessed commercial vehicles.
1798 (39) "Subdivided lot" means a lot, parcel, or other division of land, that is a division of
1799 a base parcel.
1800 (40) "Taxable value" means fair market value less any applicable reduction allowed for
1801 residential property under Section 59-2-103.
1802 (41) "Tax area" means a geographic area created by the overlapping boundaries of one
1803 or more taxing entities.
1804 (42) "Taxing entity" means any county, city, town, school district, special taxing
1805 district, local district under Title 17B, Limited Purpose Local Government Entities - Local
1806 Districts, or other political subdivision of the state with the authority to levy a tax on property.
1807 (43) (a) "Tax roll" means a permanent record of the taxes charged on property, as
1808 extended on the assessment roll, and may be maintained on the same record or records as the
1809 assessment roll or may be maintained on a separate record properly indexed to the assessment
1810 roll.
1811 (b) "Tax roll" includes tax books, tax lists, and other similar materials.
1812 Section 27. Section 59-2-926 is amended to read:
1813 59-2-926. Proposed tax increase by state -- Notice -- Contents -- Dates.
1814 If the state authorizes a [
1815 the [
1816 Section 53F-2-301 or 53F-2-301.5, or authorizes a levy pursuant to Section 59-2-1602 that
1817 exceeds the certified revenue levy as defined in Section 59-2-102, the state shall publish a
1818 notice no later than 10 days after the last day of the annual legislative general session that
1819 meets the following requirements:
1820 (1) (a) The Office of the Legislative Fiscal Analyst shall advertise that the state
1821 authorized a levy that generates revenue in excess of the previous year's ad valorem tax
1822 revenue, plus eligible new growth as defined in Section 59-2-924, but exclusive of revenue
1823 from collections from redemptions, interest, and penalties:
1824 (i) in a newspaper of general circulation in the state; and
1825 (ii) as required in Section 45-1-101.
1826 (b) Except an advertisement published on a website, the advertisement described in
1827 Subsection (1)(a):
1828 (i) shall be no less than 1/4 page in size and the type used shall be no smaller than 18
1829 point, and surrounded by a 1/4-inch border;
1830 (ii) may not be placed in that portion of the newspaper where legal notices and
1831 classified advertisements appear; and
1832 (iii) shall be run once.
1833 (2) The form and content of the notice shall be substantially as follows:
1834
1835 The state has budgeted an increase in its property tax revenue from $__________ to
1836 $__________ or ____%. The increase in property tax revenues will come from the following
1837 sources (include all of the following provisions):
1838 (a) $__________ of the increase will come from (provide an explanation of the cause
1839 of adjustment or increased revenues, such as reappraisals or factoring orders);
1840 (b) $__________ of the increase will come from natural increases in the value of the
1841 tax base due to (explain cause of eligible new growth, such as new building activity,
1842 annexation, etc.);
1843 (c) a home valued at $100,000 in the state of Utah which based on last year's (levy for
1844 the basic state-supported school program, [
1845 Valuation Agency Fund, or both) paid $____________ in property taxes would pay the
1846 following:
1847 (i) $__________ if the state of Utah did not budget an increase in property tax revenue
1848 exclusive of eligible new growth; and
1849 (ii) $__________ under the increased property tax revenues exclusive of eligible new
1850 growth budgeted by the state of Utah."
1851 Section 28. Section 59-2-1208 is amended to read:
1852 59-2-1208. Amount of homeowner's credit -- Cost-of-living adjustment --
1853 Limitation -- General Fund as source of credit.
1854 (1) (a) Subject to [
1855 on or after January 1, 2007, a claimant may claim a homeowner's credit that does not exceed
1856 the following amounts:
| 1857 | If household income is | Homeowner's credit | ||
| 1858 | $0 -- $9,159 | $798 | ||
| 1859 | $9,160 -- $12,214 | $696 | ||
| 1860 | $12,215 -- $15,266 | $597 | ||
| 1861 | $15,267 -- $18,319 | $447 | ||
| 1862 | $18,320 -- $21,374 | $348 | ||
| 1863 | $21,375 -- $24,246 | $199 | ||
| 1864 | $24,247 -- $26,941 | $98 | ||
1866 increase or decrease the household income eligibility amounts and the credits under Subsection
1867 (1)(a) by a percentage equal to the percentage difference between the consumer price index for
1868 the preceding calendar year and the consumer price index for calendar year 2006.
1869 (ii) For purposes of Subsection (1)(b)(i), the commission shall calculate the consumer
1870 price index as provided in Sections 1(f)(4) and 1(f)(5), Internal Revenue Code.
1871 [
1872
1873
1874
1875 (2) An individual may not receive the homeowner's credit under this section if:
1876 (a) the individual is claimed as a personal exemption on another individual's federal
1877 income tax return during any portion of a calendar year for which the individual seeks to claim
1878 the homeowner's credit under this section; or
1879 (b) the individual is a dependent with respect to whom another individual claims a tax
1880 credit under Section 24(h)(4), Internal Revenue Code, during any portion of a calendar year for
1881 which the individual seeks to claim the homeowner's credit under this section.
1882 (3) A payment for a homeowner's credit allowed by this section, and provided for in
1883 Section 59-2-1204, shall be paid from the General Fund.
1884 (4) For a calendar year that begins on or after January 1, 2018, after the commission
1885 has adjusted the homeowner credit amount under Subsection (1)(b), the commission shall
1886 increase each homeowner credit amount under Subsection (1) by the following amounts:
1887 (a) for a calendar year that begins on January 1, 2018, $14;
1888 (b) for a calendar year that begins on January 1, 2019, $22;
1889 (c) for a calendar year that begins on January 1, 2020, $31;
1890 (d) for a calendar year that begins on January 1, 2021, $40; and
1891 (e) for a calendar year that begins on or after January 1, 2022, $49.
1892 Section 29. Section 59-2-1209 is amended to read:
1893 59-2-1209. Amount of renter's credit -- Cost-of-living adjustment -- Renter's
1894 credit may be claimed only for rent that does not constitute a rental assistance payment --
1895 Limitation -- General Fund as source of credit -- Maximum credit.
1896 (1) (a) Subject to Subsections (2) and (3), for a calendar year beginning on or after
1897 January 1, 2007, a claimant may claim a renter's credit for the previous calendar year that does
1898 not exceed the following amounts:
| 1899 | If household income is | Percentage of rent allowed as a credit | ||
| 1900 | $0 -- $9,159 | 9.5% | ||
| 1901 | $9,160 -- $12,214 | 8.5% | ||
| 1902 | $12,215 -- $15,266 | 7.0% | ||
| 1903 | $15,267 -- $18,319 | 5.5% | ||
| 1904 | $18,320 -- $21,374 | 4.0% | ||
| 1905 | $21,375 -- $24,246 | 3.0% | ||
| 1906 | $24,247 -- $26,941 | 2.5% | ||
1908 increase or decrease the household income eligibility amounts under Subsection (1)(a) by a
1909 percentage equal to the percentage difference between the consumer price index for the
1910 preceding calendar year and the consumer price index for calendar year 2006.
1911 (ii) For purposes of Subsection (1)(b)(i), the commission shall calculate the consumer
1912 price index as provided in Sections 1(f)(4) and 1(f)(5), Internal Revenue Code.
1913 (2) A claimant may claim a renter's credit under this part only for rent that does not
1914 constitute a rental assistance payment.
1915 [
1916
1917
1918 (3) An individual may not receive the renter's credit under this section if the individual
1919 is:
1920 (a) claimed as a personal exemption on another individual's federal income tax return
1921 during any portion of a calendar year for which the individual seeks to claim the renter's credit
1922 under this section; or
1923 (b) a dependent with respect to whom another individual claims a tax credit under
1924 Section 24(h)(4), Internal Revenue Code, during any portion of a calendar year for which the
1925 individual seeks to claim the renter's credit under this section.
1926 (4) A payment for a renter's credit allowed by this section, and provided for in Section
1927 59-2-1204, shall be paid from the General Fund.
1928 (5) For calendar years beginning on or after January 1, 2007, a credit under this section
1929 may not exceed the maximum amount allowed as a homeowner's credit for each income
1930 bracket under Subsection 59-2-1208(1)(a).
1931 Section 30. Section 59-7-104 is amended to read:
1932 59-7-104. Tax -- Minimum tax.
1933 (1) Each domestic and foreign corporation, except [
1934 is exempt under Section 59-7-102, shall pay an annual tax to the state based on [
1935 corporation's Utah taxable income for the taxable year for the privilege of exercising [
1936 corporation's corporate franchise or for the privilege of doing business in the state.
1937 (2) The tax shall be [
1938 (3) The minimum tax a corporation shall pay under this chapter is $100.
1939 Section 31. Section 59-7-110 is amended to read:
1940 59-7-110. Utah net loss -- Carryforward and carryback -- Deduction.
1941 (1) [
1942 amount of Utah net loss that the taxpayer may carry back or forward to offset income of
1943 another taxable year [
1944 [
1945
1946
1947
1948 [
1949 (i) carry back a Utah net loss from a taxable year [
1950
1951 [
1952 (ii) carry forward a Utah net loss from a taxable year for 15 taxable years following the
1953 taxable year of the loss.
1954 [
1955 loss carryback, the taxpayer may not carry back a Utah net loss [
1956
1957 (3) A taxpayer that carries forward a Utah net loss shall carry forward the Utah net loss
1958 [
1959 deduction, minus Utah net losses from previous years that [
1960
1961 (4) (a) Except as provided in Subsection (4)(b), the amount of Utah net loss that [
1962
1963 (i) the remaining Utah net loss after deduction of any amounts of the Utah net loss that
1964 [
1965 (ii) the remaining Utah taxable income before net loss deduction of the year identified
1966 in Subsection (3) after deduction of Utah net losses from previous years that [
1967
1968 Subsection (3).
1969 (b) (i) The amount of Utah net loss [
1970 year may not exceed $1,000,000 in Utah taxable income for each return filed under this chapter
1971 in a taxable year.
1972 (ii) A taxpayer may carry forward a Utah net loss in excess of $1,000,000 [
1973
1974 (iii) A taxpayer may carry a remaining Utah net loss [
1975 one or more taxable years in accordance with this section.
1976 (5) (a) (i) Subject to Subsection (5)(a)(ii), a corporation acquiring the assets or stock of
1977 another corporation may not deduct any net loss incurred by the acquired corporation prior to
1978 the date of acquisition.
1979 (ii) Subsection (5)(a)(i) does not apply if the only change in the corporation is that of
1980 the state of incorporation.
1981 (b) An acquired corporation may deduct the acquired corporation's net losses incurred
1982 before the date of acquisition against the acquired corporation's separate income as calculated
1983 under Subsections (6) and (7) if the acquired corporation has continued to carry on a trade or
1984 business substantially the same as that conducted before the acquisition.
1985 (6) For purposes of Subsection (5)(b), the amount of net loss an acquired corporation
1986 that is acquired by a unitary group may deduct is calculated by:
1987 (a) subject to Subsection (7):
1988 (i) except as provided in Subsection (6)(a)(ii), calculating the sum of:
1989 (A) an amount determined by dividing the average value of the acquired corporation's
1990 real and tangible personal property owned or rented and used in this state during the taxable
1991 year by the average value of all of the unitary group's real and tangible personal property owned
1992 or rented and used during the taxable year;
1993 (B) an amount determined by dividing the total amount paid in this state during the
1994 taxable year by the acquired corporation for compensation by the total compensation paid
1995 everywhere by the unitary group during the taxable year; and
1996 (C) an amount determined by:
1997 (I) dividing the total sales of the acquired corporation in this state during the taxable
1998 year by the total sales of the unitary group everywhere during the taxable year; and
1999 (II) if the unitary group elects or is required to calculate the fraction for apportioning
2000 business income to this state using the method described in Subsection 59-7-311[
2001 taxable year 2019 or taxable year 2020, multiplying the amount calculated under Subsection
2002 (6)(a)(i)(C)(I) by [
2003 (ii) if the unitary group is required or elects to calculate the fraction for apportioning
2004 business income to this state using the method described in Subsection 59-7-311[
2005 calculating an amount determined by dividing the total sales of the acquired corporation in this
2006 state during the taxable year by the total sales of the unitary group everywhere during the
2007 taxable year;
2008 (b) dividing the amount calculated under Subsection (6)(a) by the same denominator of
2009 the fraction the unitary group uses to apportion business income to this state[
2010 taxable year[
2011 (c) multiplying the amount calculated under Subsection (6)(b) by the business income
2012 of the unitary group for the taxable year that is subject to apportionment under Section
2013 59-7-311; and
2014 (d) calculating the sum of:
2015 (i) the amount calculated under Subsection (6)(c); and
2016 (ii) the following amounts allocable to the acquired corporation for the taxable year:
2017 (A) nonbusiness income allocable to this state; or
2018 (B) nonbusiness loss allocable to this state.
2019 (7) The amounts calculated under Subsection (6)(a) shall be derived in the same
2020 manner as those amounts are derived for purposes of apportioning the unitary group's business
2021 income before deducting the net loss, including a modification made in accordance with
2022 Section 59-7-320.
2023 Section 32. Section 59-7-201 is amended to read:
2024 59-7-201. Tax -- Minimum tax.
2025 (1) There is imposed upon each corporation, except [
2026 exempt under Section 59-7-102 [
2027 taxable income for the taxable year that is derived from sources within this state other than
2028 income for any period [
2029 corporation's tax base under Section 59-7-104.
2030 (2) The tax imposed by Subsection (1) shall be [
2031 taxable income.
2032 (3) In no case shall the tax be less than $100.
2033 Section 33. Section 59-7-302 is amended to read:
2034 59-7-302. Definitions -- Determination of taxpayer status.
2035 (1) As used in this part, unless the context otherwise requires:
2036 (a) "Aircraft type" means a particular model of aircraft as designated by the
2037 manufacturer of the aircraft.
2038 (b) "Airline" means the same as that term is defined in Section 59-2-102.
2039 (c) "Airline revenue ton miles" means, for an airline, the total revenue ton miles during
2040 the airline's tax period.
2041 (d) "Business income" means income arising from transactions and activity in the
2042 regular course of the taxpayer's trade or business and includes income from tangible and
2043 intangible property if the acquisition, management, and disposition of the property constitutes
2044 integral parts of the taxpayer's regular trade or business operations.
2045 (e) "Commercial domicile" means the principal place from which the trade or business
2046 of the taxpayer is directed or managed.
2047 (f) "Compensation" means wages, salaries, commissions, and any other form of
2048 remuneration paid to employees for personal services.
2049 (g) "Excluded NAICS code" means a NAICS code of the 2017 North American
2050 Industry Classification System of the federal Executive Office of the President, Office of
2051 Management and Budget, within:
2052 (i) NAICS Code 211120, Crude Petroleum Extraction;
2053 (ii) NAICS Industry Group 2121, Coal Mining;
2054 (iii) NAICS Industry Group 2212, Natural Gas Distribution;
2055 (iv) NAICS Subsector 311, Food Manufacturing;
2056 (v) NAICS Industry Group 3121, Beverage Manufacturing;
2057 (vi) NAICS Code 327310, Cement Manufacturing;
2058 (vii) NAICS Subsector 482, Rail Transportation;
2059 (viii) NAICS Code 512110, Motion Picture and Video Production;
2060 (ix) NAICS Subsection 515, Broadcasting (except Internet); or
2061 (x) NAICS Code 522110, Commercial Banking.
2062 [
2063 means the same as that term is defined in Section 59-2-102.
2064 (ii) "Mobile flight equipment" does not include:
2065 (A) a spare engine; or
2066 (B) tangible personal property described in Subsection 59-2-102(27) owned by an air
2067 charter service or an air contract service.
2068 [
2069 [
2070 [
2071
2072
2073
2074
2075
2076 [
2077
2078
2079
2080
2081
2082 (j) "Optional apportionment taxpayer" means a taxpayer described in Subsection (3).
2083 (k) "Phased-in sales factor weighted taxpayer" means a taxpayer that:
2084 (i) is not a sales factor weighted taxpayer;
2085 (ii) does not meet the definition of an optional apportionment taxpayer; or
2086 (iii) for a taxable year beginning on or after January 1, 2020:
2087 (A) meets the definition of an optional apportionment taxpayer; and
2088 (B) apportioned business income using the method described in Subsection
2089 59-7-311(4) during the previous taxable year.
2090 [
2091 [
2092 59-7-306 through 59-7-310.
2093 [
2094 taxpayer described in Subsection (2).
2095 [
2096
2097
2098
2099
2100
2101 [
2102 [
2103 [
2104
2105 [
2106 [
2107
2108 [
2109 [
2110
2111
2112
2113
2114 [
2115 Commonwealth of Puerto Rico, any territory or possession of the United States, and any
2116 foreign country or political subdivision thereof.
2117 [
2118 (i) transporting a passenger or cargo; or
2119 (ii) from miscellaneous sales of merchandise as part of providing transportation
2120 services.
2121 [
2122 within the borders of this state:
2123 (i) during the airline's tax period; and
2124 (ii) from flight stages that originate or terminate in this state.
2125 [
2126 [
2127
2128 (2) (a) A taxpayer is a sales factor weighted taxpayer if, regardless of the number of
2129 economic activities the taxpayer performs, the taxpayer generates greater than 50% of the
2130 taxpayer's total sales everywhere from economic activities that are classified in a NAICS code
2131 of the 2002 or 2007 North American Industry Classification System of the federal Executive
2132 Office of the President, Office of Management and Budget, other than:
2133 (i) a NAICS code within NAICS Sector 21, Mining;
2134 (ii) a NAICS code within NAICS Industry Group 2212, Natural Gas Distribution;
2135 (iii) a NAICS code within NAICS Sector 31-33, Manufacturing, except NAICS Code
2136 336111, Automobile Manufacturing;
2137 (iv) a NAICS code within NAICS Sector 48-49, Transportation and Warehousing;
2138 (v) a NAICS code within NAICS Sector 51, Information, except NAICS Subsector
2139 519, Other Information Services; or
2140 (vi) a NAICS code within NAICS Sector 52, Finance and Insurance.
2141 [
2142 determine if the taxpayer is a sales factor weighted taxpayer each year before the due date for
2143 filing the taxpayer's return under this chapter for the taxable year, including extensions.
2144 [
2145 total sales everywhere include only the total sales everywhere:
2146 [
2147 [
2148 required by Subsection (2)(a)[
2149 (3) (a) A taxpayer is an optional apportionment taxpayer if the average calculated in
2150 accordance with Subsection (3)(b) is greater than .50.
2151 (b) To calculate the average described in Subsection (3)(a), a taxpayer shall:
2152 (i) calculate the following two fractions:
2153 (A) the property factor fraction as described in Subsection 59-7-312(3); and
2154 (B) the payroll factor fraction as described in Subsection 59-7-315(3);
2155 (ii) add together the fractions described in Subsection (3)(b)(i); and
2156 (iii) divide the sum calculated in Subsection (3)(b)(ii):
2157 (A) except as provided in Subsection (3)(b)(iii)(B), by two; or
2158 (B) if either the property factor fraction or the payroll factor fraction has a denominator
2159 of zero or is excluded in accordance with Subsection 59-7-312(3)(b) or 59-7-315(3)(b), by one.
2160 (c) A taxpayer shall determine if the taxpayer is an optional apportionment taxpayer
2161 before the due date for filing the taxpayer's return under this chapter for the taxable year,
2162 including extensions.
2163 [
2164
2165
2166 [
2167
2168
2169 [
2170
2171
2172 [
2173
2174 [
2175 [
2176
2177 [
2178 to be a unitary group for that taxable year.
2179 [
2180 Act, the commission may define the term "economic activity" consistent with the use of the
2181 term "activity" in the 2007 North American Industry Classification System of the federal
2182 Executive Office of the President, Office of Management and Budget.
2183 Section 34. Section 59-7-311 is amended to read:
2184 59-7-311. Method of apportionment of business income.
2185 (1) For a taxable year, a taxpayer shall apportion all business income [
2186
2187 provided in this section.
2188 [
2189
2190
2191 [
2192 [
2193 [
2194 [
2195 [
2196 [
2197 [
2198 [
2199 [
2200 [
2201 [
2202 [
2203 [
2204 shall calculate the fraction for apportioning business income to this state using a fraction
2205 where:
2206 (a) the numerator of the fraction is the sales factor as calculated under Section
2207 59-7-317; and
2208 (b) the denominator of the fraction is one.
2209 [
2210 apportionment taxpayer that is not a phased-in sales factor weighted taxpayer shall calculate
2211 the fraction for apportioning business income to this state using [
2212
2213 (a) the fraction described in Subsection (4); or
2214 (b) the fraction where:
2215 (i) the numerator of the fraction is the sum of:
2216 (A) the property factor as calculated under Section 59-7-312;
2217 (B) the payroll factor as calculated under Section 59-7-315; and
2218 (C) the sales factor as calculated under Section 59-7-317; and
2219 (ii) the denominator of the fraction is three.
2220 (4) (a) Subject to other provisions of this part, a phased-in sales factor weighted
2221 taxpayer shall calculate the fraction for apportioning business income to this state as provided
2222 in Subsections (4)(b) through (d).
2223 (b) For the taxable year that begins on or after January 1, 2019, but begins on or before
2224 December 31, 2019:
2225 (i) the numerator of the fraction is the sum of:
2226 (A) the property factor as calculated under Section 59-7-312;
2227 (B) the payroll factor as calculated under Section 59-7-315; and
2228 (C) the sales factor as calculated under Subsection (4)(e)(i); and
2229 (ii) the denominator of the fraction is six.
2230 (c) For the taxable year that begins on or after January 1, 2020, but begins on or before
2231 December 31, 2020:
2232 (i) the numerator of the fraction is the sum of:
2233 (A) the property factor as calculated under Section 59-7-312;
2234 (B) the payroll factor as calculated under Section 59-7-315; and
2235 (C) the sales factor as calculated under Subsection (4)(e)(ii); and
2236 (ii) the denominator of the fraction is 10.
2237 (d) For a taxable year that begins on or after January 1, 2021, a phased-in sales factor
2238 weighted taxpayer shall calculate the fraction as described in Subsection (2).
2239 (e) (i) For the taxable year that begins on or after January 1, 2019, but begins on or
2240 before December 31, 2019, the sales factor shall be:
2241 (A) calculated as described in Section 59-7-317; and
2242 (B) multiplied by four.
2243 (ii) For the taxable year that begins on or after January 1, 2020, but begins on or before
2244 December 31, 2020, the sales factor shall be:
2245 (A) calculated as described in Section 59-7-317; and
2246 (B) multiplied by eight.
2247 (5) (a) The taxpayer shall determine the method for calculating the fraction for
2248 apportioning business income to this state under this section on or before the due date for filing
2249 the taxpayer's return under this chapter for the taxable year, including extensions.
2250 (b) The method described in Subsection (5)(a) is in effect for the taxable year.
2251 (6) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
2252 commission may make rules providing procedures for a taxpayer to make the election required
2253 by [
2254 Section 35. Section 59-7-312 is amended to read:
2255 59-7-312. Property factor for apportionment of business income -- Mobile flight
2256 equipment of an airline.
2257 (1) Except as provided in [
2258 is a fraction[
2259 (a) the numerator of which is the average value of the taxpayer's real and tangible
2260 personal property owned or rented and used in this state during the tax period; and
2261 (b) the denominator of which is the average value of all the taxpayer's real and tangible
2262 personal property owned or rented and used during the tax period.
2263 (2) The average value of an airline's real and tangible personal property owned or
2264 rented and used in this state attributable to mobile flight equipment for purposes of the
2265 numerator of the fraction described in Subsection (1) shall be calculated for each aircraft type
2266 by [
2267 (a) the total average value of the airline's mobile flight equipment of the aircraft type
2268 owned or rented and used during the tax period; and
2269 (b) a fraction[
2270 (i) the numerator of which is the Utah revenue ton miles for the aircraft type; and
2271 (ii) the denominator of which is the airline revenue ton miles for the aircraft type.
2272 (3) (a) For purposes of Subsection 59-7-302(3)(b)(i)(A) and subject to Subsection
2273 (3)(b), the property factor is a fraction:
2274 (i) the numerator of which is the value of the property in this state that is attributable to
2275 economic activities that are classified in an excluded NAICS code; and
2276 (ii) the denominator of which is the value of all property in this state.
2277 (b) A taxpayer shall exclude property from the calculation of the property factor
2278 fraction described in Subsection (3)(a) if the property may be attributed to economic activities
2279 in both excluded NAICS codes and NAICS codes that are not excluded NAICS codes.
2280 Section 36. Section 59-7-315 is amended to read:
2281 59-7-315. Payroll factor for apportionment of business income -- Compensation
2282 of flight personnel by an airline.
2283 (1) Except as provided in [
2284 a fraction[
2285 (a) the numerator of which is the total amount paid in this state during the tax period by
2286 the taxpayer for compensation[
2287 (b) the denominator of which is the total compensation paid everywhere during the tax
2288 period.
2289 (2) The total amount paid in this state during the tax period by an airline for
2290 compensation attributable to the compensation of flight personnel for purposes of the
2291 numerator of the fraction described in Subsection (1) shall be calculated for each aircraft type
2292 by [
2293 (a) the total amount paid during the tax period by the airline to flight personnel for
2294 compensation for the aircraft type; and
2295 (b) a fraction[
2296 (i) the numerator of which is the Utah revenue ton miles for the aircraft type; and
2297 (ii) the denominator of which is the airline revenue ton miles for the aircraft type.
2298 (3) (a) For purposes of Subsection 59-7-302(3)(b)(i)(B) and subject to Subsection
2299 (3)(b), the payroll factor is a fraction:
2300 (i) the numerator of which is the amount of the payroll in this state that is attributable
2301 to economic activities that are classified in an excluded NAICS code; and
2302 (ii) the denominator of which is the total amount of the payroll in this state.
2303 (b) A taxpayer engaged in economic activities that are classified in an excluded NAICS
2304 code shall exclude an individual's payroll from the calculation of the payroll factor fraction
2305 described in Subsection (3)(a) if the individual's payroll may be attributed:
2306 (i) to economic activities in both excluded NAICS codes and NAICS codes that are not
2307 excluded NAICS codes; or
2308 (ii) to providing management, information technology, finance, accounting, legal, or
2309 human resource services.
2310 Section 37. Section 59-10-104 is amended to read:
2311 59-10-104. Tax basis -- Tax rate -- Exemption.
2312 (1) [
2313 state taxable income of a resident individual as provided in this section.
2314 (2) For purposes of Subsection (1), for a taxable year, the tax is an amount equal to the
2315 product of:
2316 (a) the resident individual's state taxable income for that taxable year; and
2317 (b) [
2318 (3) This section does not apply to a resident individual exempt from taxation under
2319 Section 59-10-104.1.
2320 Section 38. Section 59-10-136 is amended to read:
2321 59-10-136. Domicile -- Temporary absence from state.
2322 (1) (a) An individual is considered to have domicile in this state if:
2323 (i) except as provided in Subsection (1)(b), a dependent with respect to whom the
2324 individual or the individual's spouse claims a personal exemption or a tax credit under Section
2325 24, Internal Revenue Code, on the individual's or individual's spouse's federal individual
2326 income tax return is enrolled in a public kindergarten, public elementary school, or public
2327 secondary school in this state; or
2328 (ii) the individual or the individual's spouse is a resident student in accordance with
2329 Section 53B-8-102 who is enrolled in an institution of higher education described in Section
2330 53B-2-101 in this state.
2331 (b) The determination of whether an individual is considered to have domicile in this
2332 state may not be determined in accordance with Subsection (1)(a)(i) if the individual:
2333 (i) is the noncustodial parent of a dependent:
2334 (A) with respect to whom the individual claims a personal exemption or a tax credit
2335 under Section 24, Internal Revenue Code, on the individual's federal individual income tax
2336 return; and
2337 (B) who is enrolled in a public kindergarten, public elementary school, or public
2338 secondary school in this state; and
2339 (ii) is divorced from the custodial parent of the dependent described in Subsection
2340 (1)(b)(i).
2341 (2) There is a rebuttable presumption that an individual is considered to have domicile
2342 in this state if:
2343 (a) the individual or the individual's spouse claims a residential exemption in
2344 accordance with Chapter 2, Property Tax Act, for that individual's or individual's spouse's
2345 primary residence;
2346 (b) the individual or the individual's spouse is registered to vote in this state in
2347 accordance with Title 20A, Chapter 2, Voter Registration; or
2348 (c) the individual or the individual's spouse asserts residency in this state for purposes
2349 of filing an individual income tax return under this chapter, including asserting that the
2350 individual or the individual's spouse is a part-year resident of this state for the portion of the
2351 taxable year for which the individual or the individual's spouse is a resident of this state.
2352 (3) (a) Subject to Subsection (3)(b), if the requirements of Subsection (1) or (2) are not
2353 met for an individual to be considered to have domicile in this state, the individual is
2354 considered to have domicile in this state if:
2355 (i) the individual or the individual's spouse has a permanent home in this state to which
2356 the individual or the individual's spouse intends to return after being absent; and
2357 (ii) the individual or the individual's spouse has voluntarily fixed the individual's or the
2358 individual's spouse's habitation in this state, not for a special or temporary purpose, but with the
2359 intent of making a permanent home.
2360 (b) The determination of whether an individual is considered to have domicile in this
2361 state under Subsection (3)(a) shall be based on the preponderance of the evidence, taking into
2362 consideration the totality of the following facts and circumstances:
2363 (i) whether the individual or the individual's spouse has a driver license in this state;
2364 (ii) whether a dependent with respect to whom the individual or the individual's spouse
2365 claims a personal exemption or a tax credit under Section 24, Internal Revenue Code, on the
2366 individual's or individual's spouse's federal individual income tax return is a resident student in
2367 accordance with Section 53B-8-102 who is enrolled in an institution of higher education
2368 described in Section 53B-2-101 in this state;
2369 (iii) the nature and quality of the living accommodations that the individual or the
2370 individual's spouse has in this state as compared to another state;
2371 (iv) the presence in this state of a spouse or dependent with respect to whom the
2372 individual or the individual's spouse claims a personal exemption or a tax credit under Section
2373 24, Internal Revenue Code, on the individual's or individual's spouse's federal individual
2374 income tax return;
2375 (v) the physical location in which earned income as defined in Section 32(c)(2),
2376 Internal Revenue Code, is earned by the individual or the individual's spouse;
2377 (vi) the state of registration of a vehicle as defined in Section 59-12-102 owned or
2378 leased by the individual or the individual's spouse;
2379 (vii) whether the individual or the individual's spouse is a member of a church, a club,
2380 or another similar organization in this state;
2381 (viii) whether the individual or the individual's spouse lists an address in this state on
2382 mail, a telephone listing, a listing in an official government publication, other correspondence,
2383 or another similar item;
2384 (ix) whether the individual or the individual's spouse lists an address in this state on a
2385 state or federal tax return;
2386 (x) whether the individual or the individual's spouse asserts residency in this state on a
2387 document, other than an individual income tax return filed under this chapter, filed with or
2388 provided to a court or other governmental entity;
2389 (xi) the failure of an individual or the individual's spouse to obtain a permit or license
2390 normally required of a resident of the state for which the individual or the individual's spouse
2391 asserts to have domicile; or
2392 (xii) whether the individual is an individual described in Subsection (1)(b).
2393 (4) (a) Notwithstanding Subsections (1) through (3) and subject to the other provisions
2394 of this Subsection (4), an individual is not considered to have domicile in this state if the
2395 individual meets the following qualifications:
2396 (i) except as provided in Subsection (4)(a)(ii)(A), the individual and the individual's
2397 spouse are absent from the state for at least 761 consecutive days; and
2398 (ii) during the time period described in Subsection (4)(a)(i), neither the individual nor
2399 the individual's spouse:
2400 (A) return to this state for more than 30 days in a calendar year;
2401 (B) claim a personal exemption or a tax credit under Section 24, Internal Revenue
2402 Code, on the individual's or individual's spouse's federal individual income tax return with
2403 respect to a dependent who is enrolled in a public kindergarten, public elementary school, or
2404 public secondary school in this state, unless the individual is an individual described in
2405 Subsection (1)(b);
2406 (C) are resident students in accordance with Section 53B-8-102 who are enrolled in an
2407 institution of higher education described in Section 53B-2-101 in this state;
2408 (D) claim a residential exemption in accordance with Chapter 2, Property Tax Act, for
2409 that individual's or individual's spouse's primary residence; or
2410 (E) assert that this state is the individual's or the individual's spouse's tax home for
2411 federal individual income tax purposes.
2412 (b) Notwithstanding Subsection (4)(a), an individual that meets the qualifications of
2413 Subsection (4)(a) to not be considered to have domicile in this state may elect to be considered
2414 to have domicile in this state by filing an individual income tax return in this state as a resident
2415 individual.
2416 (c) For purposes of Subsection (4)(a), an absence from the state:
2417 (i) begins on the later of the date:
2418 (A) the individual leaves this state; or
2419 (B) the individual's spouse leaves this state; and
2420 (ii) ends on the date the individual or the individual's spouse returns to this state if the
2421 individual or the individual's spouse remains in this state for more than 30 days in a calendar
2422 year.
2423 (d) An individual shall file an individual income tax return or amended individual
2424 income tax return under this chapter and pay any applicable interest imposed under Section
2425 59-1-402 if:
2426 (i) the individual did not file an individual income tax return or amended individual
2427 income tax return under this chapter based on the individual's belief that the individual has met
2428 the qualifications of Subsection (4)(a) to not be considered to have domicile in this state; and
2429 (ii) the individual or the individual's spouse fails to meet a qualification of Subsection
2430 (4)(a) to not be considered to have domicile in this state.
2431 (e) (i) Except as provided in Subsection (4)(e)(ii), an individual that files an individual
2432 income tax return or amended individual income tax return under Subsection (4)(d) shall pay
2433 any applicable penalty imposed under Section 59-1-401.
2434 (ii) The commission shall waive the penalties under Subsections 59-1-401(2), (3), and
2435 (5) if an individual who is required by Subsection (4)(d) to file an individual income tax return
2436 or amended individual income tax return under this chapter:
2437 (A) files the individual income tax return or amended individual income tax return
2438 within 105 days after the individual fails to meet a qualification of Subsection (4)(a) to not be
2439 considered to have domicile in this state; and
2440 (B) within the 105-day period described in Subsection (4)(e)(ii)(A), pays in full the tax
2441 due on the return, any interest imposed under Section 59-1-402, and any applicable penalty
2442 imposed under Section 59-1-401, except for a penalty under Subsection 59-1-401(2), (3), or
2443 (5).
2444 (5) (a) If an individual is considered to have domicile in this state in accordance with
2445 this section, the individual's spouse is considered to have domicile in this state.
2446 (b) For purposes of this section, an individual is not considered to have a spouse if:
2447 (i) the individual is legally separated or divorced from the spouse; or
2448 (ii) the individual and the individual's spouse claim married filing separately filing
2449 status for purposes of filing a federal individual income tax return for the taxable year.
2450 (c) Except as provided in Subsection (5)(b)(ii), for purposes of this section, an
2451 individual's filing status on a federal individual income tax return or a return filed under this
2452 chapter may not be considered in determining whether an individual has a spouse.
2453 (6) For purposes of this section, whether or not an individual or the individual's spouse
2454 claims a property tax residential exemption under Chapter 2, Property Tax Act, for the
2455 residential property that is the primary residence of a tenant of the individual or the individual's
2456 spouse may not be considered in determining domicile in this state.
2457 Section 39. Section 59-10-1018 is amended to read:
2458 59-10-1018. Definitions -- Nonrefundable taxpayer tax credits.
2459 (1) As used in this section:
2460 (a) "Dependent adult with a disability" means an individual who:
2461 (i) a claimant claims as a dependent under Section 151, Internal Revenue Code, on the
2462 claimant's federal individual income tax return for the taxable year;
2463 (ii) is not the claimant or the claimant's spouse; and
2464 (iii) is:
2465 (A) 18 years of age or older;
2466 (B) eligible for services under Title 62A, Chapter 5, Services for People with
2467 Disabilities; and
2468 (C) not enrolled in an education program for students with disabilities that is
2469 authorized under Section 53A-15-301.
2470 (b) "Dependent child with a disability" means an individual 21 years of age or younger
2471 who:
2472 (i) a claimant claims as a dependent under Section 151, Internal Revenue Code, on the
2473 claimant's federal individual income tax return for the taxable year;
2474 (ii) is not the claimant or the claimant's spouse; and
2475 (iii) is:
2476 (A) an eligible student with a disability; or
2477 (B) identified under guidelines of the Department of Health as qualified for Early
2478 Intervention or Infant Development Services.
2479 (c) "Eligible student with a disability" means an individual who is:
2480 (i) diagnosed by a school district representative under rules the State Board of
2481 Education adopts in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking
2482 Act, as having a disability classified as autism, deafness, preschool developmental delay, dual
2483 sensory impairment, hearing impairment, intellectual disability, multidisability, orthopedic
2484 impairment, other health impairment, traumatic brain injury, or visual impairment;
2485 (ii) not receiving residential services from the Division of Services for People with
2486 Disabilities created under Section 62A-5-102 or a school established under Title 53A, Chapter
2487 25b, Utah Schools for the Deaf and the Blind; and
2488 (iii) (A) enrolled in an education program for students with disabilities that is
2489 authorized under Section 53A-15-301; or
2490 (B) a recipient of a scholarship awarded under Title 53A, Chapter 1a, Part 7, Carson
2491 Smith Scholarships for Students with Special Needs Act.
2492 (d) "Head of household filing status" means a head of household, as defined in Section
2493 2(b), Internal Revenue Code, who files a single federal individual income tax return for the
2494 taxable year.
2495 (e) "Joint filing status" means:
2496 (i) [
2497 taxable year; or
2498 (ii) a surviving spouse, as defined in Section 2(a), Internal Revenue Code, who files a
2499 single federal individual income tax return for the taxable year.
2500 (f) "Single filing status" means:
2501 (i) a single individual who files a single federal individual income tax return for the
2502 taxable year; or
2503 (ii) a married individual who:
2504 (A) does not file a single federal individual income tax return jointly with that married
2505 individual's spouse for the taxable year; and
2506 (B) files a single federal individual income tax return for the taxable year.
2507 (g) "State or local income tax" means the lesser of:
2508 (i) the amount of state or local income tax that the claimant:
2509 (A) pays for the taxable year; and
2510 (B) reports on the claimant's federal individual income tax return for the taxable year,
2511 regardless of whether the claimant is allowed an itemized deduction on the claimant's federal
2512 individual income tax return for the taxable year for the full amount of state or local income tax
2513 paid; and
2514 (ii) $10,000.
2515 (h) (i) "Utah itemized deduction" means the amount the claimant deducts as allowed as
2516 an itemized deduction on the claimant's federal individual income tax return for that taxable
2517 year minus any amount of state or local income tax for the taxable year.
2518 (ii) "Utah itemized deduction" does not include any amount of qualified business
2519 income that the claimant subtracts as allowed by Section 199A, Internal Revenue Code, on the
2520 claimant's federal income tax return for that taxable year.
2521 (2) Except as provided in Section 59-10-1002.2, and subject to Subsections (3) through
2522 (5), a claimant may claim a nonrefundable tax credit against taxes otherwise due under this part
2523 equal to the sum of:
2524 (a) (i) for a claimant that deducts the standard deduction on the claimant's federal
2525 individual income tax return for the taxable year, 6% of the amount the claimant deducts as
2526 allowed as the standard deduction on the claimant's federal individual income tax return for
2527 that taxable year; or
2528 (ii) for a claimant that itemizes deductions on the claimant's federal individual income
2529 tax return for the taxable year, [
2530 itemized deduction; and
2531 [
2532 [
2533
2534 [
2535
2536
2537 [
2538 (b) the product of:
2539 (i) 75% of the total amount the claimant deducts as allowed as a personal exemption
2540 deduction on the claimant's federal individual income tax return for that taxable year, plus an
2541 additional 75% of the amount the claimant deducts as allowed as a personal exemption
2542 deduction on the claimant's federal individual income tax return for that taxable year with
2543 respect to each dependent adult with a disability or dependent child with a disability; and
2544 (ii) 6%.
2545 (3) A claimant may not carry forward or carry back a tax credit under this section.
2546 (4) The tax credit allowed by Subsection (2) shall be reduced by $.013 for each dollar
2547 by which a claimant's state taxable income exceeds:
2548 (a) for a claimant who has a single filing status, $12,000;
2549 (b) for a claimant who has a head of household filing status, $18,000; or
2550 (c) for a claimant who has a joint filing status, $24,000.
2551 (5) (a) For [
2552 commission shall increase or decrease annually the following dollar amounts by a percentage
2553 equal to the percentage difference between the consumer price index for the preceding calendar
2554 year and the consumer price index for calendar year 2007:
2555 (i) the dollar amount listed in Subsection (4)(a); and
2556 (ii) the dollar amount listed in Subsection (4)(b).
2557 (b) After the commission increases or decreases the dollar amounts listed in Subsection
2558 (5)(a), the commission shall round those dollar amounts listed in Subsection (5)(a) to the
2559 nearest whole dollar.
2560 (c) After the commission rounds the dollar amounts as required by Subsection (5)(b),
2561 the commission shall increase or decrease the dollar amount listed in Subsection (4)(c) so that
2562 the dollar amount listed in Subsection (4)(c) is equal to the product of:
2563 (i) the dollar amount listed in Subsection (4)(a); and
2564 (ii) two.
2565 (d) For purposes of Subsection (5)(a), the commission shall calculate the consumer
2566 price index as provided in Sections 1(f)(4) and 1(f)(5), Internal Revenue Code.
2567 Section 40. Section 63I-2-211 is amended to read:
2568 63I-2-211. Repeal dates -- Title 11.
2569 (1) Subsections 11-13-302(2)(a)(i) and (2)(b)(i), the language that states "or
2570 53F-2-301.5, as applicable" is repealed July 1, 2023.
2571 (2) Section 11-13-310, the language that states "or 53F-2-301.5, as applicable," is
2572 repealed July 1, 2023.
2573 [
2574 (b) When repealing Subsection 11-13a-102(4)(b), the Office of Legislative Research
2575 and General Counsel shall, in addition to the office's authority under Subsection 36-12-12(3),
2576 make necessary changes to subsection numbering and cross references.
2577 [
2578 January 1, 2020.
2579 Section 41. Section 63I-2-253 is amended to read:
2580 63I-2-253. Repeal dates -- Titles 53 through 53G.
2581 [
2582 [
2583 [
2584 [
2585 [
2586 [
2587 [
2588 [
2589
2590 [
2591 [
2592 [
2593 (b) When repealing Subsections 53B-2a-103(2) and (4), the Office of Legislative
2594 Research and General Counsel shall, in addition to its authority under Subsection 36-12-12(3),
2595 make necessary changes to subsection numbering and cross references.
2596 [
2597 [
2598 [
2599 [
2600 (i) Section 53B-8-202;
2601 (ii) Section 53B-8-203;
2602 (iii) Section 53B-8-204; and
2603 (iv) Section 53B-8-205.
2604 (b) (i) Subsection 53B-8-201(2) is repealed on July 1, 2023.
2605 (ii) When repealing Subsection 53B-8-201(2), the Office of Legislative Research and
2606 General Counsel shall, in addition to its authority under Subsection 36-12-12(3), make
2607 necessary changes to subsection numbering and cross references.
2608 [
2609 repealed July 1, 2023.
2610 (7) Subsection 53E-5-306(3)(b)(ii)(B) is repealed July 1, 2020.
2611 (8) Section 53E-5-307 is repealed July 1, 2020.
2612 (9) Subsections 53F-2-205(4) and (5), the language that states "or 53F-2-301.5, as
2613 applicable" is repealed July 1, 2023.
2614 (10) Subsection 53F-2-301(1) is repealed July 1, 2023.
2615 (11) Subsection 53F-2-515(1), the language that states "or 53F-2-301.5, as applicable"
2616 is repealed July 1, 2023.
2617 (12) Section 53F-4-204 is repealed July 1, 2019.
2618 (13) Section 53F-6-202 is repealed July 1, 2020.
2619 (14) Subsection 53F-9-302(3), the language that states "or 53F-2-301.5, as applicable"
2620 is repealed July 1, 2023.
2621 (15) Subsection 53F-9-305(3)(a), the language that states "or 53F-2-301.5, as
2622 applicable" is repealed July 1, 2023.
2623 (16) Subsection 53F-9-306(3)(a), the language that states "or 53F-2-301.5, as
2624 applicable" is repealed July 1, 2023.
2625 (17) Subsection 53G-3-304(1)(c)(i), the language that states "or 53F-2-301.5, as
2626 applicable" is repealed July 1, 2023.
2627 (18) On July 1, 2023, when making changes in this section, the Office of Legislative
2628 Research and General Counsel shall, in addition to the office's authority under Subsection
2629 36-12-12(3), make corrections necessary to ensure that sections and subsections identified in
2630 this section are complete sentences and accurately reflect the office's perception of the
2631 Legislature's intent.
2632 Section 42. Section 63I-2-259 is amended to read:
2633 63I-2-259. Repeal dates -- Title 59.
2634 (1) Section 59-1-102 is repealed on May 14, 2019.
2635 (2) In Section 59-2-926, the language that states "applicable" and "or 53F-2-301.5" is
2636 repealed July 1, 2023.
2637 (3) Subsection 59-2-1007(14) is repealed on December 31, 2018.
2638 Section 43. Section 63J-1-220 is amended to read:
2639 63J-1-220. Reporting related to pass through money distributed by state
2640 agencies.
2641 (1) As used in this section:
2642 (a) "Local government entity" means a county, municipality, school district, local
2643 district under Title 17B, Limited Purpose Local Government Entities - Local Districts, special
2644 service district under Title 17D, Chapter 1, Special Service District Act, or any other political
2645 subdivision of the state.
2646 (b) (i) "Pass through funding" means money appropriated by the Legislature to a state
2647 agency that is intended to be passed through the state agency to one or more:
2648 (A) local government entities;
2649 (B) private organizations, including not-for-profit organizations; or
2650 (C) persons in the form of a loan or grant.
2651 (ii) "Pass through funding" may be:
2652 (A) general funds, dedicated credits, or any combination of state funding sources; and
2653 (B) ongoing or one-time.
2654 (c) "Recipient entity" means a local government entity or private entity, including a
2655 nonprofit entity, that receives money by way of pass through funding from a state agency.
2656 (d) "State agency" means a department, commission, board, council, agency,
2657 institution, officer, corporation, fund, division, office, committee, authority, laboratory, library,
2658 unit, bureau, panel, or other administrative unit of the executive branch of the state.
2659 (e) (i) "State money" means money that is owned, held, or administered by a state
2660 agency and derived from state fees or tax revenues.
2661 (ii) "State money" does not include contributions or donations received by a state
2662 agency.
2663 (2) A state agency may not provide a recipient entity state money through pass through
2664 funding unless:
2665 (a) the state agency enters into a written agreement with the recipient entity; and
2666 (b) the written agreement described in Subsection (2)(a) requires the recipient entity to
2667 provide the state agency:
2668 (i) a written description and an itemized report at least annually detailing the
2669 expenditure of the state money, or the intended expenditure of any state money that has not
2670 been spent; and
2671 (ii) a final written itemized report when all the state money is spent.
2672 (3) A state agency shall provide to the Governor's Office of Management and Budget a
2673 copy of a written description or itemized report received by the state agency under Subsection
2674 (2).
2675 (4) Notwithstanding Subsection (2), a state agency is not required to comply with this
2676 section to the extent that the pass through funding is issued:
2677 (a) under a competitive award process;
2678 (b) in accordance with a formula enacted in statute;
2679 (c) in accordance with a state program under parameters in statute or rule that guides
2680 the distribution of the pass through funding; or
2681 (d) under the authority of the Minimum School Program, as defined in Subsection
2682 53A-17a-103[
2683 Section 44. Repealer.
2684 This bill repeals:
2685 Section 53F-2-602, Board local levy state guarantee.
2686 Section 53F-8-401, Capital outlay levy -- Authority to use proceeds of .0002 tax
2687 rate for maintenance of school facilities -- Restrictions and procedure -- Limited
2688 authority to use proceeds for general fund purposes -- Notification required when using
2689 proceeds for general fund purposes -- Authority for small school districts to use levy
2690 proceeds for operation and maintenance of plant services.
2691 Section 53F-8-404, Board-approved leeway -- Purpose -- State support --
2692 Disapproval.
2693 Section 53F-8-405, Additional levy by local school board for debt service, school
2694 sites, buildings, buses, textbooks, and supplies.
2695 Section 53F-8-406, Board leeway for reading improvement.
2696 Section 45. Appropriation.
2697 The following sums of money are appropriated for the fiscal year beginning July 1,
2698 2018, and ending June 30, 2019. These are additions to amounts previously appropriated for
2699 fiscal year 2019.
2700 Subsection 45(a). Operating and capital budgets.
2701 Under the terms and conditions of Title 63J, Chapter 1, Budgetary Procedures Act, the
2702 Legislature appropriates the following sums of money from the funds or accounts indicated for
2703 the use and support of the government of the state of Utah.
2704 ITEM 1
2705 To State Board of Education -- Minimum School Program -- Basic School Program
2706 From Education Fund
($36,117,300)
2707 From Local Revenue
$36,117,300
2708 ITEM 2
2709 To State Board of Education -- Minimum School Program -- Voted and
2710 Board Local Levy Programs
2711 From Education Fund Restricted -- Local Levy Growth Account
$36,117,300
2712 Schedule of Programs:
2713 Voted Local Levy Program $18,050,600
2714 Board Local Levy Program $18,066,700
2715 ITEM 3
2716 To State Board of Education -- Minimum School Program -- Basic School Program
2717 From Education Fund
($18,650,000)
2718 From Local Revenue
$18,650,000
2719 ITEM 4
2720 To State Board of Education -- Minimum School Program - Related to Basic School
2721 Program
2722 From Education Fund
($46,500,000)
2723 From Education Fund Restricted -- Teacher and
2724 Student Success Account, One-time $65,150,000
2725 Schedule of Programs:
2726 Flexible Allocation - WPU Distribution $18,650,000
2727 Subsection 45(b). Restricted fund and account transfers.
2728 The Legislature authorizes the Division of Finance to transfer the following amounts
2729 between the following funds or accounts as indicated. Expenditures and outlays from the funds
2730 to which the money is transferred must be authorized by an appropriation.
2731 ITEM 5
2732 To Education Fund Restricted -- Local Levy Growth Account
2733 From Education Fund
$36,117,300
2734 Schedule of Programs:
2735 Education Fund Restricted -- Local Levy
2736 Growth Account $36,117,300
2737 ITEM 6
2738 To Education Fund Restricted -- Teacher and Student Success Account
2739 From Education Fund
$65,150,000
2740 Schedule of Programs:
2741 Education Fund Restricted -- Teacher and
2742 Student Success Account $65,150,000
2743 Section 46. Retrospective operation and effective date.
2744 (1) Except as provided in Subsection (2), this bill has retrospective operation for a
2745 taxable year beginning on or after January 1, 2018.
2746 (2) The amendments to Sections 59-7-110, 59-7-302, 59-7-311, 59-7-312, and
2747 59-7-315 take effect for a taxable year beginning on or after January 1, 2019.
2748 Section 47. Coordinating H.B. 293 with H.B. 1 -- Substantive amendments.
2749 If this H.B. 293 and H.B. 1, Public Education Base Budget Amendments, both pass and
2750 become law, the Legislature intends that the amendments to Section 53F-2-301 in this bill
2751 supersede the amendments to Section 53F-2-301 in H.B. 1.
2752 Section 48. Coordinating H.B. 293 with S.B. 72 -- Substantive and technical
2753 amendments.
2754 If this H.B. 293 and S.B. 72, Business Income Tax Modifications, both pass and
2755 become law, it is the intent of the Legislature that the Office of Legislative Research and
2756 General Counsel shall prepare the Utah Code database for publication as follows:
2757 (1) on May 8, 2018, by:
2758 (a) amending Subsection 59-7-302(1)(g)(ii) in S.B. 72 to read:
2759 "(ii) "Excluded NAICS code" does not include a NAICS code of the 2017 North
2760 American Classification System of the federal Executive Office of the President, Office of
2761 Management and Budget, within:
2762 (A) NAICS Industry Group 3254, Pharmaceutical and Medicine Manufacturing;
2763 (B) NAICS Industry Group 3333, Commercial and Service Industry Machinery
2764 Manufacturing;
2765 (C) NAICS Subsector 334, Computer and Electronic Product Manufacturing;
2766 (D) NAICS Code 336111, Automobile Manufacturing; or
2767 (E) NAICS Subsector 519, Other Information Services.";
2768 (b) removing Subsection 59-7-302(1)(l) in S.B. 72 and renumbering the remaining
2769 subsections accordingly;
2770 (c) amending Subsection 59-7-302(1)(o) in S.B. 72 to read:
2771 "(o) "Sales factor weighted taxpayer" means a taxpayer that:
2772 (i) performs economic activities that are classified only in included NAICS codes; or
2773 (ii) does not meet the definition of optional apportionment taxpayer.";
2774 (d) amending Subsection 59-7-302(2) in S.B. 72 to read:
2775 "(2)(a) For the taxable year beginning on or after January 1, 2018, but beginning on or
2776 before December 31, 2018, a taxpayer is an optional apportionment taxpayer if the average
2777 calculated in accordance with Subsection (2)(b) is greater than .50.
2778 (b) To calculate the average described in Subsection (2)(a), a taxpayer shall:
2779 (i) calculate the following two fractions:
2780 (A) the property factor fraction as described in Subsection 59-7-312(3); and
2781 (B) the payroll factor fraction as described in Subsection 59-7-315(3);
2782 (ii) add together the fractions described in Subsection (2)(b)(i); and
2783 (iii) divide the sum calculated in Subsection (2)(b)(ii):
2784 (A) except as provided in Subsection (2)(b)(iii)(B), by two; or
2785 (B) if either the property factor fraction or the payroll factor fraction has a denominator
2786 of zero or is excluded in accordance with Subsection 59-7-312(3)(b) or 59-7-315(3)(b), by one.
2787 (c) A taxpayer shall determine if the taxpayer is an optional apportionment taxpayer
2788 before the due date, including extensions, for filing the taxpayer's return under this chapter for
2789 the taxable year.";
2790 (e) amending Subsection 59-7-311(3) in S.B. 72 to read:
2791 "(3) Subject to other provisions of this part, a sales factor weighted taxpayer shall
2792 calculate the fraction for apportioning business income to this state using a fraction where:
2793 (a) the numerator of the fraction is the sales factor as calculated under Section
2794 59-7-317; and
2795 (b) the denominator of the fraction is one."
2796 (f) changing the reference, in Subsection 59-7-312(3)(a) of S.B. 72, from "Subsection
2797 59-7-302(2)(c)(i)(A)" to "Subsection 59-7-302(2)(b)(i)(A)"; and
2798 (g) changing the reference, in Subsection 59-7-315(3)(a) of S.B. 72, from "Subsection
2799 59-7-302(2)(c)(i)(B)" to "Subsection 59-7-302(2)(b)(i)(B)"; and
2800 (2) on January 1, 2019, the amendments to Sections 59-7-302, 59-7-311, 59-7-312, and
2801 59-7-315 in H.B. 293 supersede the amendments to Sections 59-7-302, 59-7-311, 59-7-312,
2802 and 59-7-315 in S.B. 72, except that Subsection 59-7-302(2)(a) shall read:
2803 "(2)(a) A taxpayer is a sales factor weighted taxpayer if the taxpayer apportioned
2804 business income using the method described in Subsection 59-7-311(2) during the previous
2805 taxable year or if, regardless of the number of economic activities the taxpayer performs, the
2806 taxpayer generates greater than 50% of the taxpayer's total sales everywhere from economic
2807 activities that are classified in a NAICS code of the 2002 or 2007 North American Industry
2808 Classification System of the federal Executive Office of the President, Office of Management
2809 and Budget, other than:
2810 (i) a NAICS code within NAICS Sector 21, Mining;
2811 (ii) a NAICS code within NAICS Industry Group 2212, Natural Gas Distribution;
2812 (iii) a NAICS code within NAICS Sector 31-33, Manufacturing, except:
2813 (A) NAICS Industry Group 3254, Pharmaceutical and Medicine Manufacturing;
2814 (B) NAICS Industry Group 3333, Commercial and Service Industry Machinery
2815 Manufacturing;
2816 (C) NAICS Subsector 334, Computer and Electronic Product Manufacturing; and
2817 (D) NAICS Code 336111, Automobile Manufacturing;
2818 (iv) a NAICS code within NAICS Sector 48-49, Transportation and Warehousing;
2819 (v) a NAICS code within NAICS Sector 51, Information, except NAICS Subsector
2820 519, Other Information Services; or
2821 (vi) a NAICS code within NAICS Sector 52, Finance and Insurance."