1     
BUDGET DEADLINE AMENDMENTS

2     
2018 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Lincoln Fillmore

5     
House Sponsor: Susan Pulsipher

6     

7     LONG TITLE
8     General Description:
9          This bill amends certain deadlines related to local government budgets.
10     Highlighted Provisions:
11          This bill:
12          ▸     amends the deadline by which a taxing entity is required to adopt certain budgets;
13     and
14          ▸     makes technical changes.
15     Money Appropriated in this Bill:
16          None
17     Other Special Clauses:
18          This bill provides a special effective date.
19     Utah Code Sections Affected:
20     AMENDS:
21          10-5-109, as last amended by Laws of Utah 1989, Chapter 118
22          10-6-118, as last amended by Laws of Utah 2001, Chapter 178
23          17C-1-601.5, as renumbered and amended by Laws of Utah 2016, Chapter 350
24          53G-7-303, as renumbered and amended by Laws of Utah 2018, Chapter 3
25          59-2-924, as last amended by Laws of Utah 2017, Chapter 390
26          63H-1-701, as last amended by Laws of Utah 2015, Chapters 258 and 377
27          63H-2-502, as enacted by Laws of Utah 2009, Chapter 378
28     

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

30          Section 1. Section 10-5-109 is amended to read:
31          10-5-109. Adoption of budgets -- Filing.
32          [Prior to June 22]
33          (1) Before June 30 of each year, or August 17 in the case of a property tax increase
34     under Sections 59-2-919 through 59-2-923, the council shall by resolution or ordinance adopt a
35     budget for the ensuing fiscal year for each fund for which a budget is required under this
36     chapter. [A]
37          (2) The council shall file a copy of the final budget for each fund [shall be filed] with
38     the state auditor within 30 days after adoption.
39          Section 2. Section 10-6-118 is amended to read:
40          10-6-118. Adoption of final budget -- Certification and filing.
41          (1) Before [the last June 22] June 30 of each fiscal period, or, in the case of a property
42     tax increase under Sections 59-2-919 through 59-2-923, before August 17 of the year for which
43     a property tax increase is proposed, the governing body shall by resolution or ordinance adopt a
44     budget for the ensuing fiscal period for each fund for which a budget is required under this
45     chapter. [A copy of the final budget for each fund shall be certified by the budget officer and
46     filed with the state auditor within 30 days after adoption.]
47          (2) The budget officer of the governing body shall certify a copy of the final budget and
48     file the copy with the state auditor within 30 days after adoption.
49          Section 3. Section 17C-1-601.5 is amended to read:
50          17C-1-601.5. Annual agency budget -- Fiscal year -- Public hearing required --
51     Auditor forms -- Requirement to file form.
52          (1) Each agency shall prepare an annual budget of the agency's revenues and
53     expenditures for each fiscal year.
54          (2) The board shall adopt each agency budget:
55          (a) for an agency created by a municipality, before June [22] 30; or
56          (b) for an agency created by a county, before December 15.
57          (3) The agency's fiscal year shall be the same as the fiscal year of the community that

58     created the agency.
59          (4) (a) Before adopting an annual budget, each board shall hold a public hearing on the
60     annual budget.
61          (b) Each agency shall provide notice of the public hearing on the annual budget by:
62          (i) (A) publishing at least one notice in a newspaper of general circulation within the
63     agency boundaries, one week before the public hearing; or
64          (B) if there is no newspaper of general circulation within the agency boundaries,
65     posting a notice of the public hearing in at least three public places within the agency
66     boundaries; and
67          (ii) publishing notice on the Utah Public Notice Website created in Section 63F-1-701,
68     at least one week before the public hearing.
69          (c) Each agency shall make the annual budget available for public inspection at least
70     three days before the date of the public hearing.
71          (5) The state auditor shall prescribe the budget forms and the categories to be contained
72     in each annual budget, including:
73          (a) revenues and expenditures for the budget year;
74          (b) legal fees; and
75          (c) administrative costs, including rent, supplies, and other materials, and salaries of
76     agency personnel.
77          (6) (a) Within 90 days after adopting an annual budget, each board shall file a copy of
78     the annual budget with the auditor of the county in which the agency is located, the State Tax
79     Commission, the state auditor, the State Board of Education, and each taxing entity from which
80     the agency receives project area funds.
81          (b) The requirement of Subsection (6)(a) to file a copy of the annual budget with the
82     state as a taxing entity is met if the agency files a copy with the State Tax Commission and the
83     state auditor.
84          Section 4. Section 53G-7-303 is amended to read:
85          53G-7-303. Local governing board budget procedures.

86          (1) As used in this section:
87          (a) "Budget officer" means:
88          (i) for a school district, the school district's superintendent; or
89          (ii) for a charter school, an individual selected by the charter school governing board.
90          (b) "Governing board" means:
91          (i) for a school district, the local school board; or
92          (ii) for a charter school, the charter school governing board.
93          (2) (a) For a school district, before June [22] 30 of each year, a local school board shall
94     adopt a budget and make appropriations for the next fiscal year.
95          (b) For a school district, if the tax rate in the school district's proposed budget exceeds
96     the certified tax rate defined in Section 59-2-924, the local school board shall comply with
97     Section 59-2-919 in adopting the budget, except as provided by Section 53F-8-301.
98          (3) (a) For a school district, before the adoption or amendment of a budget, a local
99     school board shall hold a public hearing, as defined in Section 10-9a-103, on the proposed
100     budget or budget amendment.
101          (b) In addition to complying with Title 52, Chapter 4, Open and Public Meetings Act,
102     in regards to the public hearing described in Subsection (3)(a), at least 10 days prior to the
103     public hearing, a local school board shall:
104          (i) publish a notice of the public hearing in a newspaper or combination of newspapers
105     of general circulation in the school district, except as provided in Section 45-1-101;
106          (ii) publish a notice of the public hearing electronically in accordance with Section
107     45-1-101;
108          (iii) file a copy of the proposed budget with the local school board's business
109     administrator for public inspection; and
110          (iv) post the proposed budget on the school district's Internet website.
111          (c) A notice of a public hearing on a school district's proposed budget shall include
112     information on how the public may access the proposed budget as provided in Subsections
113     (3)(b)(iii) and (iv).

114          (4) For a charter school, before June [22] 30 of each year, a charter school governing
115     board shall adopt a budget for the next fiscal year.
116          (5) Within 30 days of adopting a budget, a governing board shall file a copy of the
117     adopted budget with the state auditor and the State Board of Education.
118          Section 5. Section 59-2-924 is amended to read:
119          59-2-924. Definitions -- Report of valuation of property to county auditor and
120     commission -- Transmittal by auditor to governing bodies -- Calculation of certified tax
121     rate -- Rulemaking authority -- Adoption of tentative budget -- Notice provided by the
122     commission.
123          (1) As used in this section:
124          (a) (i) "Ad valorem property tax revenue" means revenue collected in accordance with
125     this chapter.
126          (ii) "Ad valorem property tax revenue" does not include:
127          (A) interest;
128          (B) penalties;
129          (C) collections from redemptions; or
130          (D) revenue received by a taxing entity from personal property that is semiconductor
131     manufacturing equipment assessed by a county assessor in accordance with Part 3, County
132     Assessment.
133          (b) (i) "Aggregate taxable value of all property taxed" means:
134          (A) the aggregate taxable value of all real property a county assessor assesses in
135     accordance with Part 3, County Assessment, for the current year;
136          (B) the aggregate taxable value of all real and personal property the commission
137     assesses in accordance with Part 2, Assessment of Property, for the current year; and
138          (C) the aggregate year end taxable value of all personal property a county assessor
139     assesses in accordance with Part 3, County Assessment, contained on the prior year's tax rolls
140     of the taxing entity.
141          (ii) "Aggregate taxable value of all property taxed" does not include the aggregate year

142     end taxable value of personal property that is:
143          (A) semiconductor manufacturing equipment assessed by a county assessor in
144     accordance with Part 3, County Assessment; and
145          (B) contained on the prior year's tax rolls of the taxing entity.
146          (c) "Centrally assessed benchmark value" means an amount equal to the highest year
147     end taxable value of real and personal property the commission assesses in accordance with
148     Part 2, Assessment of Property, for a previous calendar year that begins on or after January 1,
149     2015, adjusted for taxable value attributable to:
150          (i) an annexation to a taxing entity; or
151          (ii) an incorrect allocation of taxable value of real or personal property the commission
152     assesses in accordance with Part 2, Assessment of Property.
153          (d) (i) "Centrally assessed new growth" means the greater of:
154          (A) zero; or
155          (B) the amount calculated by subtracting the centrally assessed benchmark value
156     adjusted for prior year end incremental value from the taxable value of real and personal
157     property the commission assesses in accordance with Part 2, Assessment of Property, for the
158     current year, adjusted for current year incremental value.
159          (ii) "Centrally assessed new growth" does not include a change in value as a result of a
160     change in the method of apportioning the value prescribed by the Legislature, a court, or the
161     commission in an administrative rule or administrative order.
162          (e) "Certified tax rate" means a tax rate that will provide the same ad valorem property
163     tax revenue for a taxing entity as was budgeted by that taxing entity for the prior year.
164          (f) "Eligible new growth" means the greater of:
165          (i) zero; or
166          (ii) the sum of:
167          (A) locally assessed new growth;
168          (B) centrally assessed new growth; and
169          (C) project area new growth.

170          (g) "Incremental value" means the same as that term is defined in Section 17C-1-102.
171          (h) (i) "Locally assessed new growth" means the greater of:
172          (A) zero; or
173          (B) the amount calculated by subtracting the year end taxable value of real property the
174     county assessor assesses in accordance with Part 3, County Assessment, for the previous year,
175     adjusted for prior year end incremental value from the taxable value of real property the county
176     assessor assesses in accordance with Part 3, County Assessment, for the current year, adjusted
177     for current year incremental value.
178          (ii) "Locally assessed new growth" does not include a change in:
179          (A) value as a result of factoring in accordance with Section 59-2-704, reappraisal, or
180     another adjustment;
181          (B) assessed value based on whether a property is allowed a residential exemption for a
182     primary residence under Section 59-2-103;
183          (C) assessed value based on whether a property is assessed under Part 5, Farmland
184     Assessment Act; or
185          (D) assessed value based on whether a property is assessed under Part 17, Urban
186     Farming Assessment Act.
187          (i) "Project area" means the same as that term is defined in Section 17C-1-102.
188          (j) "Project area new growth" means an amount equal to the incremental value that is
189     no longer provided to an agency as tax increment.
190          (2) Before June 1 of each year, the county assessor of each county shall deliver to the
191     county auditor and the commission the following statements:
192          (a) a statement containing the aggregate valuation of all taxable real property a county
193     assessor assesses in accordance with Part 3, County Assessment, for each taxing entity; and
194          (b) a statement containing the taxable value of all personal property a county assessor
195     assesses in accordance with Part 3, County Assessment, from the prior year end values.
196          (3) The county auditor shall, on or before June 8, transmit to the governing body of
197     each taxing entity:

198          (a) the statements described in Subsections (2)(a) and (b);
199          (b) an estimate of the revenue from personal property;
200          (c) the certified tax rate; and
201          (d) all forms necessary to submit a tax levy request.
202          (4) (a) Except as otherwise provided in this section, the certified tax rate shall be
203     calculated by dividing the ad valorem property tax revenue that a taxing entity budgeted for the
204     prior year by the amount calculated under Subsection (4)(b).
205          (b) For purposes of Subsection (4)(a), the legislative body of a taxing entity shall
206     calculate an amount as follows:
207          (i) calculate for the taxing entity the difference between:
208          (A) the aggregate taxable value of all property taxed; and
209          (B) any adjustments for current year incremental value;
210          (ii) after making the calculation required by Subsection (4)(b)(i), calculate an amount
211     determined by increasing or decreasing the amount calculated under Subsection (4)(b)(i) by the
212     average of the percentage net change in the value of taxable property for the equalization
213     period for the three calendar years immediately preceding the current calendar year;
214          (iii) after making the calculation required by Subsection (4)(b)(ii), calculate the product
215     of:
216          (A) the amount calculated under Subsection (4)(b)(ii); and
217          (B) the percentage of property taxes collected for the five calendar years immediately
218     preceding the current calendar year; and
219          (iv) after making the calculation required by Subsection (4)(b)(iii), calculate an amount
220     determined by subtracting eligible new growth from the amount calculated under Subsection
221     (4)(b)(iii).
222          (5) A certified tax rate for a taxing entity described in this Subsection (5) shall be
223     calculated as follows:
224          (a) except as provided in Subsection (5)(b), for a new taxing entity, the certified tax
225     rate is zero;

226          (b) for a municipality incorporated on or after July 1, 1996, the certified tax rate is:
227          (i) in a county of the first, second, or third class, the levy imposed for municipal-type
228     services under Sections 17-34-1 and 17-36-9; and
229          (ii) in a county of the fourth, fifth, or sixth class, the levy imposed for general county
230     purposes and such other levies imposed solely for the municipal-type services identified in
231     Section 17-34-1 and Subsection 17-36-3(22); and
232          (c) for debt service voted on by the public, the certified tax rate is the actual levy
233     imposed by that section, except that a certified tax rate for the following levies shall be
234     calculated in accordance with Section 59-2-913 and this section:
235          (i) a school levy provided for under Section 53A-16-113, 53A-17a-133, or
236     53A-17a-164; and
237          (ii) a levy to pay for the costs of state legislative mandates or judicial or administrative
238     orders under Section 59-2-1602.
239          (6) (a) A judgment levy imposed under Section 59-2-1328 or 59-2-1330 may be
240     imposed at a rate that is sufficient to generate only the revenue required to satisfy one or more
241     eligible judgments.
242          (b) The ad valorem property tax revenue generated by a judgment levy described in
243     Subsection (6)(a) may not be considered in establishing a taxing entity's aggregate certified tax
244     rate.
245          (7) (a) For the purpose of calculating the certified tax rate, the county auditor shall use:
246          (i) the taxable value of real property:
247          (A) the county assessor assesses in accordance with Part 3, County Assessment; and
248          (B) contained on the assessment roll;
249          (ii) the year end taxable value of personal property:
250          (A) a county assessor assesses in accordance with Part 3, County Assessment; and
251          (B) contained on the prior year's assessment roll; and
252          (iii) the taxable value of real and personal property the commission assesses in
253     accordance with Part 2, Assessment of Property.

254          (b) For purposes of Subsection (7)(a), taxable value does not include eligible new
255     growth.
256          (8) (a) On or before June [22] 30, a taxing entity shall annually adopt a tentative
257     budget.
258          (b) If a taxing entity intends to exceed the certified tax rate, the taxing entity shall
259     notify the county auditor of:
260          (i) the taxing entity's intent to exceed the certified tax rate; and
261          (ii) the amount by which the taxing entity proposes to exceed the certified tax rate.
262          (c) The county auditor shall notify property owners of any intent to levy a tax rate that
263     exceeds the certified tax rate in accordance with Sections 59-2-919 and 59-2-919.1.
264          (9) (a) Subject to Subsection (9)(d), the commission shall provide notice, through
265     electronic means on or before July 31, to a taxing entity and the Revenue and Taxation Interim
266     Committee if:
267          (i) the amount calculated under Subsection (9)(b) is 10% or more of the year end
268     taxable value of the real and personal property the commission assesses in accordance with
269     Part 2, Assessment of Property, for the previous year, adjusted for prior year end incremental
270     value; and
271          (ii) the amount calculated under Subsection (9)(c) is 50% or more of the total year end
272     taxable value of the real and personal property of a taxpayer the commission assesses in
273     accordance with Part 2, Assessment of Property, for the previous year.
274          (b) For purposes of Subsection (9)(a)(i), the commission shall calculate an amount by
275     subtracting the taxable value of real and personal property the commission assesses in
276     accordance with Part 2, Assessment of Property, for the current year, adjusted for current year
277     incremental value, from the year end taxable value of the real and personal property the
278     commission assesses in accordance with Part 2, Assessment of Property, for the previous year,
279     adjusted for prior year end incremental value.
280          (c) For purposes of Subsection (9)(a)(ii), the commission shall calculate an amount by
281     subtracting the total taxable value of real and personal property of a taxpayer the commission

282     assesses in accordance with Part 2, Assessment of Property, for the current year, from the total
283     year end taxable value of the real and personal property of a taxpayer the commission assesses
284     in accordance with Part 2, Assessment of Property, for the previous year.
285          (d) The notification under Subsection (9)(a) shall include a list of taxpayers that meet
286     the requirement under Subsection (9)(a)(ii).
287          Section 6. Section 63H-1-701 is amended to read:
288          63H-1-701. Annual authority budget -- Fiscal year -- Public hearing required --
289     Auditor forms -- Requirement to file form.
290          (1) The authority shall prepare and its board adopt an annual budget of revenues and
291     expenditures for the authority for each fiscal year.
292          (2) Each annual authority budget shall be adopted before June [22] 30.
293          (3) The authority's fiscal year shall be the period from July 1 to the following June 30.
294          (4) (a) Before adopting an annual budget, the authority board shall hold a public
295     hearing on the annual budget.
296          (b) The authority shall provide notice of the public hearing on the annual budget by
297     publishing notice:
298          (i) at least once in a newspaper of general circulation within the state, one week before
299     the public hearing; and
300          (ii) on the Utah Public Notice Website created in Section 63F-1-701, for at least one
301     week immediately before the public hearing.
302          (c) The authority shall make the annual budget available for public inspection at least
303     three days before the date of the public hearing.
304          (5) The state auditor shall prescribe the budget forms and the categories to be contained
305     in each authority budget, including:
306          (a) revenues and expenditures for the budget year;
307          (b) legal fees; and
308          (c) administrative costs, including rent, supplies, and other materials, and salaries of
309     authority personnel.

310          (6) (a) Within 30 days after adopting an annual budget, the authority board shall file a
311     copy of the annual budget with the auditor of each county in which a project area of the
312     authority is located, the State Tax Commission, the state auditor, the State Board of Education,
313     and each taxing entity that levies a tax on property from which the authority collects property
314     tax allocation.
315          (b) The requirement of Subsection (6)(a) to file a copy of the annual budget with the
316     state as a taxing entity is met if the authority files a copy with the State Tax Commission and
317     the state auditor.
318          Section 7. Section 63H-2-502 is amended to read:
319          63H-2-502. Annual authority budget -- Auditor forms -- Requirement to file
320     form.
321          (1) (a) The authority shall prepare an annual budget of revenues and expenditures for
322     the authority for each fiscal year.
323          (b) Before June [22] 30 of each year and subject to the other provisions of this section,
324     the board shall adopt an annual budget of revenues and expenditures of the authority for the
325     immediately following fiscal year.
326          (2) (a) Before adopting an annual budget, the board shall hold a public hearing on the
327     annual budget.
328          (b) Before holding the public hearing required by this Subsection (2), the board shall
329     post notice of the public hearing on the Utah Public Notice Website created under Section
330     63F-1-701 no less than 14 days before the day on which the public hearing is to be held.
331          (3) The state auditor shall prescribe the budget forms and the categories to be contained
332     in each annual budget of the authority, including:
333          (a) revenues and expenditures for the budget year;
334          (b) the outstanding bonds and related expenses;
335          (c) legal fees; and
336          (d) administrative costs, including:
337          (i) rent;

338          (ii) supplies;
339          (iii) other materials; and
340          (iv) salaries of authority personnel.
341          (4) Within 30 days after adopting an annual budget, the board shall file a copy of the
342     annual budget with:
343          (a) the State Tax Commission; and
344          (b) the state auditor.
345          (5) (a) Subject to Subsection (5)(b), the board may by resolution amend an annual
346     budget of the authority.
347          (b) The board may make an amendment of an annual budget that would increase total
348     expenditures of the authority only after:
349          (i) holding a public hearing; and
350          (ii) before holding the public hearing required by this Subsection (5)(b), posting notice
351     of the public hearing on the Utah Public Notice Website created under Section 63F-1-701 no
352     less than 14 days before the day on which the public hearing is to be held.
353          (6) The authority may not make expenditures in excess of the total expenditures
354     established in the annual budget as it is adopted or amended.
355          Section 8. Effective date.
356          This bill takes effect on January 1, 2019.