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7 LONG TITLE
8 General Description:
9 This bill modifies provisions related to the transient room sales tax.
10 Highlighted Provisions:
11 This bill:
12 ▸ modifies the requirements for how a county of the fourth, fifth, or sixth class spends
13 revenue from the transient room tax;
14 ▸ limits the surplus in a transient room tax reserve fund;
15 ▸ authorizes a county auditor to make referrals to assist the State Tax Commission in
16 determining whether to audit a person that is required to collect and remit the
17 transient room tax;
18 ▸ creates a sunset date for provisions relating to expenditure of transient room tax
19 revenue for an economic diversification activity; and
20 ▸ makes technical and conforming changes.
21 Money Appropriated in this Bill:
22 None
23 Other Special Clauses:
24 None
25 Utah Code Sections Affected:
26 AMENDS:
27 17-31-2, as last amended by Laws of Utah 2020, Chapter 315
28 17-31-3, as last amended by Laws of Utah 2014, Chapter 176
29 17-31-5.5, as last amended by Laws of Utah 2020, Chapter 315
30 59-12-302, as last amended by Laws of Utah 2020, Chapter 315
31 63I-1-217, as last amended by Laws of Utah 2020, Sixth Special Session, Chapter 18
32
33 Be it enacted by the Legislature of the state of Utah:
34 Section 1. Section 17-31-2 is amended to read:
35 17-31-2. Purposes of transient room tax and expenditure of revenue -- Purchase
36 or lease of facilities -- Mitigating impacts of recreation, tourism, or conventions --
37 Issuance of bonds.
38 (1) As used in this section:
39 (a) "Aircraft" means the same as that term is defined in Section 72-10-102.
40 (b) "Airport" means the same as that term is defined in Section 72-10-102.
41 (c) "Airport authority" means the same as that term is defined in Section 72-10-102.
42 (d) "Airport operator" means the same as that term is defined in Section 72-10-102.
43 (e) "Base year revenue" means the amount of revenue generated by a transient room tax
44 and collected by a county for fiscal year 2018-19.
45 (f) "Base year promotion expenditure" means the amount of revenue generated by a
46 transient room tax that a county spent for the purpose described in Subsection (2)(a) during
47 fiscal year 2018-19.
48 (g) "Economic diversification activity" means an economic development activity that is
49 reasonably similar to, supplements, or expands any economic program as administered by the
50 state or the Governor's Office of Economic Development.
51 [
52 (i) is located within a county that has a national park within or partially within the
53 county's boundaries; and
54 (ii) imposes a resort communities tax authorized by Section 59-12-401.
55 [
56 or a special service district.
57 (j) "Tourism" means an activity to develop, encourage, solicit, or market tourism that
58 attracts transient guests to the county, including planning, development, and advertising for the
59 purpose described in Subsection (2)(a)(i).
60 [
61 Section 10-2-301.
62 [
63 Section 59-12-301.
64 (2) Subject to the requirements of this section, a county legislative body may impose
65 the transient room tax for the purposes of:
66 (a) establishing and promoting:
67 (i) tourism;
68 (ii) recreation, [
69 (iii) an economic diversification activity if:
70 (A) the county is a county of the fourth, fifth, or sixth class;
71 (B) the county has more than one national park within or partially within the county's
72 boundaries; and
73 (C) the county has a base population of 9,000 or more according to current United
74 States census data;
75 (b) acquiring, leasing, constructing, furnishing, maintaining, or operating:
76 (i) convention meeting rooms;
77 (ii) exhibit halls;
78 (iii) visitor information centers;
79 (iv) museums;
80 (v) sports and recreation facilities including practice fields, stadiums, and arenas;
81 (vi) related facilities;
82 (vii) if a national park is located within or partially within the [
83 boundaries, the following on any route designated by the county legislative body:
84 (A) transit service, including shuttle service; and
85 (B) parking infrastructure; and
86 (viii) an airport, if:
87 (A) the county is a county of the fourth, fifth, or sixth class; and
88 (B) the county is the airport operator of the airport;
89 (c) acquiring land, leasing land, or making payments for construction or infrastructure
90 improvements required for or related to the purposes listed in Subsection (2)(b);
91 (d) as required to mitigate the impacts of recreation, tourism, or conventions in
92 counties of the fourth, fifth, and sixth class, paying for:
93 (i) solid waste disposal operations;
94 (ii) emergency medical services;
95 (iii) search and rescue activities;
96 (iv) law enforcement activities; and
97 (v) road repair and upgrade of:
98 (A) class B roads, as defined in Section 72-3-103;
99 (B) class C roads, as defined in Section 72-3-104; or
100 (C) class D roads, as defined in Section 72-3-105; and
101 (e) making the annual payment of principal, interest, premiums, and necessary reserves
102 for any of the aggregate of bonds authorized under Subsection (5).
103 (3) (a) The county legislative body of a county that imposes a transient room tax at a
104 rate of 3% or less may expend the revenue generated as provided in Subsection (4), after
105 making any reduction required by Subsection (6).
106 (b) The county legislative body of a county that imposes a transient room tax at a rate
107 that exceeds 3% or increases the rate of transient room tax above 3% may expend:
108 (i) the revenue generated from the transient room tax at a rate of 3% as provided in
109 Subsection (4), after making any reduction required by Subsection (6); and
110 (ii) the revenue generated from the portion of the rate that exceeds 3%:
111 (A) for any combination of the purposes described in Subsections (2) and (5); and
112 (B) regardless of the limitation on expenditures for the purposes described in
113 Subsection (4).
114 (4) Subject to [
115 1/3 of the revenue generated by a rate of transient room tax that does not exceed 3%, for any
116 combination of the purposes described in Subsections (2)(b) through (2)(e).
117 (5) (a) The county legislative body may issue bonds or cause bonds to be issued, as
118 permitted by law, to pay all or part of any costs incurred for the purposes set forth in
119 Subsections (2)(b) through (2)(d) that are permitted to be paid from bond proceeds.
120 (b) If a county legislative body does not need the revenue generated by the transient
121 room tax for payment of principal, interest, premiums, and reserves on bonds issued as
122 provided in Subsection (2)(e), the county legislative body shall expend that revenue for the
123 purposes described in Subsection (2), subject to the limitation of Subsection (4).
124 (6) (a) In addition to the purposes described in Subsection (2), a county legislative
125 body may expend up to 4% of the total revenue generated by a transient room tax to pay a
126 provider for emergency medical services in one or more eligible towns.
127 (b) A county legislative body shall reduce the amount that the county is authorized to
128 expend for the purposes described in Subsection (4) by subtracting the amount of transient
129 room tax revenue expended in accordance with Subsection (6)(a) from the amount of revenue
130 described in Subsection (4).
131 (7) (a) [
132 county of the fourth, fifth, or sixth class shall expend the revenue generated by a transient room
133 tax as follows:
134 (i) an amount equal to the county's base year promotion expenditure for the purpose
135 described in Subsection (2)(a)(i);
136 (ii) an amount equal to the difference between the county's base year revenue and the
137 county's base year promotion expenditure in accordance with Subsections (3) through (6); and
138 (iii) (A) 37% of the revenue that exceeds the county's base year revenue for the purpose
139 described in Subsection (2)(a)(i); and
140 (B) subject to Subsection [
141 base year revenue for any combination of the purposes described in Subsections [
142 (2)(a)(ii) through (e) or to pay an emergency medical services provider for emergency medical
143 services in one or more eligible towns.
144 (b) A county legislative body in a county of the fourth, fifth, or sixth class with one or
145 more national recreation areas administered by the National Park Service or the Forest Service
146 or national parks within or partially within the county's boundaries shall expend the revenue
147 generated by a transient room tax as follows:
148 (i) for a purpose described in Subsection (2)(a) and subject to the limitations described
149 in Subsection (7)(d), the greater of:
150 (A) an amount equal to the county's base year promotion expenditure; or
151 (B) 37% of the transient room tax revenue; and
152 (ii) the remainder of the transient room tax not expended in accordance with
153 Subsection (7)(b)(i) for any combination of the purposes described in Subsection (2) and,
154 subject to the limitation described in Subsection (7)(c), Subsection (6).
155 [
156 not:
157 (i) expend more than 4% of the revenue generated by a transient room tax to pay an
158 emergency medical services provider for emergency medical services in one or more eligible
159 towns; or
160 (ii) expend revenue generated by a transient room tax for the purpose described in
161 Subsection (2)(e) in an amount that exceeds the county's base year promotion expenditure.
162 (d) A county legislative body may not expend:
163 (i) more than 1/5 of the revenue described in Subsection (7)(b)(i) for a purpose
164 described in Subsection (2)(a)(ii); and
165 (ii) more than 1/3 of the revenue described in Subsection (7)(b)(i) for the purpose
166 described in Subsection (2)(a)(iii).
167 [
168 provision of this section.
169 [
170 the fourth, fifth, or sixth class is less than the county's base year promotion expenditure:
171 (i) Subsections (7)(a) through [
172 (ii) the county legislative body shall expend the revenue generated by the transient
173 room tax in accordance with Subsections (3) through (6).
174 Section 2. Section 17-31-3 is amended to read:
175 17-31-3. Reserve fund authorized -- Use of collected funds -- Limitation on
176 surplus in fund.
177 (1) The county legislative body may create a reserve fund [
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180 (2) (a) Subject to Subsection (2)(b), a county legislative body shall retain any transient
181 room tax funds collected but not expended during any fiscal year in the reserve fund to be used
182 in accordance with Sections 17-31-2 through 17-31-5.
183 (b) The accumulated unappropriated surplus in the reserve fund, as determined before
184 the county's adoption of a tentative budget, may not exceed 50% of the total transient room tax
185 revenue for the current fiscal year.
186 Section 3. Section 17-31-5.5 is amended to read:
187 17-31-5.5. Report by county legislative body -- Content.
188 (1) The legislative body of each county that imposes a transient room tax under Section
189 59-12-301 or a tourism, recreation, cultural, convention, and airport facilities tax under Section
190 59-12-603 shall prepare annually a report in accordance with Subsection (2).
191 (2) The report described in Subsection (1) shall include a breakdown of expenditures
192 into the following categories:
193 (a) for the transient room tax, identification of expenditures for:
194 (i) establishing and promoting:
195 (A) recreation;
196 (B) tourism;
197 (C) film production; [
198 (D) conventions; and
199 (E) economic diversification activity;
200 (ii) acquiring, leasing, constructing, furnishing, or operating:
201 (A) convention meeting rooms;
202 (B) exhibit halls;
203 (C) visitor information centers;
204 (D) museums; and
205 (E) related facilities;
206 (iii) acquiring or leasing land required for or related to the purposes listed in
207 Subsection (2)(a)(ii);
208 (iv) mitigation costs as identified in Subsection 17-31-2(2)(d); and
209 (v) making the annual payment of principal, interest, premiums, and necessary reserves
210 for any or the aggregate of bonds issued to pay for costs referred to in Subsections
211 17-31-2(2)(e) and (5)(a); and
212 (b) for the tourism, recreation, cultural, convention, and airport facilities tax,
213 identification of expenditures for:
214 (i) financing tourism promotion, which means an activity to develop, encourage,
215 solicit, or market tourism that attracts transient guests to the county, including planning,
216 product development, and advertising;
217 (ii) the development, operation, and maintenance of the following facilities as defined
218 in Section 59-12-602:
219 (A) an airport facility;
220 (B) a convention facility;
221 (C) a cultural facility;
222 (D) a recreation facility; and
223 (E) a tourist facility; and
224 (iii) a pledge as security for evidences of indebtedness under Subsection 59-12-603(3).
225 (3) For the transient room tax, the report described in Subsection (1) shall include a
226 breakdown of each expenditure described in Subsection (2)(a)(i), including:
227 (a) whether the expenditure was used for in-state and out-of-state promotion efforts;
228 (b) an explanation of how the expenditure targeted a cost created by tourism; and
229 (c) an accounting of the expenditure showing that the expenditure was used only for
230 costs directly related to a cost created by tourism.
231 (4) A county legislative body shall provide a copy of the report described in Subsection
232 (1) to:
233 (a) the Utah Office of Tourism within the Governor's Office of Economic
234 Development;
235 (b) [
236 (c) the Office of the Legislative Fiscal Analyst.
237 Section 4. Section 59-12-302 is amended to read:
238 59-12-302. Collection of tax -- Administrative charge.
239 (1) Except as provided in Subsections (2), (3), and (4), the tax authorized under this
240 part shall be administered, collected, and enforced in accordance with:
241 (a) the same procedures used to administer, collect, and enforce the tax under:
242 (i) Part 1, Tax Collection; or
243 (ii) Part 2, Local Sales and Use Tax Act; and
244 (b) Chapter 1, General Taxation Policies.
245 (2) The location of a transaction shall be determined in accordance with Sections
246 59-12-211 through 59-12-215.
247 (3) A tax under this part is not subject to Section 59-12-107.1 or 59-12-123 or
248 Subsections 59-12-205(2) through (6).
249 [
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251 (4) A county auditor may make referrals to the commission to assist the commission in
252 determining whether to require an audit of any person that is required to remit a tax authorized
253 under this part.
254 (5) The commission:
255 (a) shall distribute the revenue collected from the tax to the county within which the
256 revenue was collected; and
257 (b) shall retain and deposit an administrative charge in accordance with Section
258 59-1-306 from revenue the commission collects from a tax under this part.
259 Section 5. Section 63I-1-217 is amended to read:
260 63I-1-217. Repeal dates, Title 17.
261 (1) Subsection 17-16-21(2)(d) is repealed July 1, 2023.
262 (2) Title 17, Chapter 21a, Part 3, Administration and Standards, which creates the Utah
263 Electronic Recording Commission, is repealed July 1, 2022.
264 (3) In relation to Section 17-31-2, on July 1, 2026:
265 (a) Subsection 17-31-2(1)(g), which defines "economic diversification activity," is
266 repealed;
267 (b) Subsection 17-31-2(2)(a)(iii), relating to establishing and promoting an economic
268 diversification activity, is repealed;
269 (c) Subsection 17-31-2(7)(b)(i) is amended to read:
270 "(i) for a purpose described in Subsection (2)(a) and subject to the limitation described
271 in Subsection (7)(d), the greater of:"; and
272 (d) Subsection 17-31-2(7)(d)(ii), relating to a limitation on the expenditure of revenue
273 for an economic diversification activity, is repealed.
274 (4) Subsection 17-31-5.5(2)(a)(i)(E), relating to economic diversification activity, is
275 repealed July 1, 2026.