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7 LONG TITLE
8 General Description:
9 This bill enacts provisions relating to the taxation and regulation of peer-to-peer car
10 sharing companies and owners by public entities.
11 Highlighted Provisions:
12 This bill:
13 ▸ defines terms;
14 ▸ prohibits a public entity from regulating a peer-to-peer car sharing company or a
15 peer-to-peer vehicle owner in the same manner as a motor vehicle rental company;
16 ▸ prohibits a public entity from regulating a peer-to-peer car rental transaction in the
17 same manner as a motor vehicle rental company transaction;
18 ▸ exempts the rental of a motor vehicle that a peer-to-peer car sharing company
19 facilitates from certain taxes; and
20 ▸ makes technical and corresponding changes.
21 Money Appropriated in this Bill:
22 None
23 Other Special Clauses:
24 None
25 Utah Code Sections Affected:
26 AMENDS:
27 13-2-1, as last amended by Laws of Utah 2020, Chapter 118
28 13-51-101, as enacted by Laws of Utah 2015, Chapter 461
29 13-51-102, as last amended by Laws of Utah 2019, Chapter 459
30 13-51-104, as enacted by Laws of Utah 2015, Chapter 461
31 13-51-109, as enacted by Laws of Utah 2015, Chapter 461
32 41-26-106, as enacted by Laws of Utah 2019, Chapter 459
33 59-12-603, as last amended by Laws of Utah 2020, Chapter 407
34 59-12-1201, as last amended by Laws of Utah 2016, Chapters 184 and 291
35 ENACTS:
36 13-51-301, Utah Code Annotated 1953
37 13-51-302, Utah Code Annotated 1953
38 13-51-303, Utah Code Annotated 1953
39
40 Be it enacted by the Legislature of the state of Utah:
41 Section 1. Section 13-2-1 is amended to read:
42 13-2-1. Consumer protection division established -- Functions.
43 (1) There is established within the Department of Commerce the Division of Consumer
44 Protection.
45 (2) The division shall administer and enforce the following:
46 (a) Chapter 5, Unfair Practices Act;
47 (b) Chapter 10a, Music Licensing Practices Act;
48 (c) Chapter 11, Utah Consumer Sales Practices Act;
49 (d) Chapter 15, Business Opportunity Disclosure Act;
50 (e) Chapter 20, New Motor Vehicle Warranties Act;
51 (f) Chapter 21, Credit Services Organizations Act;
52 (g) Chapter 22, Charitable Solicitations Act;
53 (h) Chapter 23, Health Spa Services Protection Act;
54 (i) Chapter 25a, Telephone and Facsimile Solicitation Act;
55 (j) Chapter 26, Telephone Fraud Prevention Act;
56 (k) Chapter 28, Prize Notices Regulation Act;
57 (l) Chapter 32a, Pawnshop and Secondhand Merchandise Transaction Information Act;
58 (m) Chapter 34, Utah Postsecondary Proprietary School Act;
59 (n) Chapter 34a, Utah Postsecondary School State Authorization Act;
60 (o) Chapter 39, Child Protection Registry;
61 (p) Chapter 41, Price Controls During Emergencies Act;
62 (q) Chapter 42, Uniform Debt-Management Services Act;
63 (r) Chapter 49, Immigration Consultants Registration Act;
64 (s) Chapter 51, Transportation [
65 (t) Chapter 52, Residential Solar Energy Disclosure Act;
66 (u) Chapter 53, Residential, Vocational and Life Skills Program Act;
67 (v) Chapter 54, Ticket Website Sales Act;
68 (w) Chapter 56, Ticket Transferability Act; and
69 (x) Chapter 57, Maintenance Funding Practices Act.
70 Section 2. Section 13-51-101 is amended to read:
71
72
73 13-51-101. Title.
74 (1) This chapter is known as the "Transportation Company Act."
75 (2) This [
76 Act."
77 Section 3. Section 13-51-102 is amended to read:
78 13-51-102. Definitions.
79 As used in this part:
80 (1) "Division" means the Division of Consumer Protection within the Department of
81 Commerce.
82 (2) "Prearranged ride" means a period of time that:
83 (a) begins when the transportation network driver has accepted a passenger's request
84 for a ride through the transportation network company's software application; and
85 (b) ends when the passenger exits the transportation network driver's vehicle.
86 (3) "Software application" means an Internet-connected software platform, including a
87 mobile application, that a transportation network company uses to:
88 (a) connect a transportation network driver to a passenger; and
89 (b) process passenger requests.
90 (4) "Transportation network company" means an entity that:
91 (a) uses a software application to connect a passenger to a transportation network
92 driver providing transportation network services;
93 (b) is not:
94 (i) a taxicab, as defined in Section 53-3-102; or
95 (ii) a motor carrier, as defined in Section 72-9-102; and
96 (c) except in certain cases involving a motor vehicle with a level four or five automated
97 driving system, as defined in Section 41-26-102.1, does not own, control, operate, or manage
98 the vehicle used to provide the transportation network services.
99 (5) "Transportation network driver" means:
100 (a) an individual who:
101 (i) pays a fee to a transportation network company, and, in exchange, receives a
102 connection to a potential passenger from the transportation network company;
103 (ii) operates a motor vehicle that:
104 (A) the individual owns, leases, or is authorized to use; and
105 (B) the individual uses to provide transportation network services; and
106 (iii) receives, in exchange for providing a passenger a ride, compensation that exceeds
107 the individual's cost to provide the ride; or
108 (b) a level four or five automated driving system, as defined in Section 41-26-102.1,
109 when the automated driving system is operating the vehicle and used to provide a passenger a
110 ride in exchange for compensation.
111 (6) "Transportation network services" means, for a transportation network driver
112 providing services through a transportation network company:
113 (a) providing a prearranged ride; or
114 (b) being engaged in a waiting period.
115 (7) "Waiting period" means a period of time when:
116 (a) a transportation network driver is logged into a transportation network company's
117 software application; and
118 (b) the transportation network driver is not engaged in a prearranged ride.
119 Section 4. Section 13-51-104 is amended to read:
120 13-51-104. Licensure -- Division audits -- Fines.
121 (1) A person may not operate a transportation network company without registering
122 with the division under Subsection (2).
123 (2) The division shall register a person to operate a transportation network company if:
124 (a) the person:
125 (i) demonstrates to the division that the person meets the definition of a transportation
126 network company under Section 13-51-102; and
127 (ii) pays a registration fee in an amount determined by the division in accordance with
128 Section 63J-1-504; and
129 (b) the division determines that the person complies with the operating requirements
130 for a transportation network company described in this [
131 (3) A transportation network company's registration under Subsection (2) is:
132 (a) valid until one year after the day on which the transportation network company
133 registers with the division; and
134 (b) renewable if the transportation network company meets the requirements of
135 Subsection (2).
136 (4) The division may audit the records of a transportation network company, including
137 a random sample of the transportation network company's records related to transportation
138 network drivers:
139 (a) no more than twice per year;
140 (b) at a location agreed to by the division and the transportation network company; and
141 (c) notwithstanding Subsection (4)(a), at any time to investigate a complaint.
142 (5) The division may fine a transportation network company up to $500 for each
143 violation of this [
144 Section 5. Section 13-51-109 is amended to read:
145 13-51-109. Preemption clause.
146 (1) Except as provided in Subsection (2), this [
147 of a municipality, county, or local government regarding a transportation network company, a
148 transportation network driver, or transportation network services.
149 (2) This [
150 regulation regarding a transportation network driver providing transportation network services
151 at an airport.
152 Section 6. Section 13-51-301 is enacted to read:
153
154 13-51-301. Title.
155 This part is known as "Peer-to-peer Car Sharing Act."
156 Section 7. Section 13-51-302 is enacted to read:
157 13-51-302. Definitions.
158 As used in this part:
159 (1) "Motor vehicle rental company" means a person:
160 (a) (i) in the business of renting motor vehicles to the public; and
161 (ii) that is exempted from sales and use tax under Title 59, Chapter 12, Sales and Use
162 Tax Act, for the purchase of a motor vehicle; or
163 (b) a person engaged in the short term rental or lease of motor vehicles, which lease or
164 rental is subject to the tax imposed under Section 59-12-1201.
165 (2) (a) "Peer-to-peer car sharing company" means a business platform that connects
166 vehicle owners with drivers to enable the sharing of vehicles for financial consideration.
167 (b) "Peer-to-peer car sharing company" does not include a motor vehicle rental
168 company.
169 (3) "Peer-to-peer sharing transaction" means the authorized use of a vehicle by an
170 individual other than the shared vehicle owner through a peer-to-peer car sharing company.
171 (4) "Public entity" means:
172 (a) the state; or
173 (b) a political subdivision of the state.
174 (5) (a) "Shared vehicle owner" means the registered owner, or a person or entity
175 designated by the registered owner, of a vehicle made available for sharing to shared vehicle
176 drivers through a peer-to-peer car sharing program.
177 (b) "Shared vehicle owner" does not include a person that is exempt from sales and use
178 tax under Title 59, Chapter 12, Sales and Use Tax Act, for the purchase of a motor vehicle.
179 Section 8. Section 13-51-303 is enacted to read:
180 13-51-303. Prohibition of regulation.
181 Except as specifically authorized in statute, a public entity may not regulate:
182 (1) a peer-to-peer car sharing company or a shared vehicle owner in the same or
183 substantially similar manner as a motor vehicle rental company; or
184 (2) a peer-to-peer car rental transaction in the same or substantially similar manner as a
185 transaction that is facilitated by a motor vehicle rental company.
186 Section 9. Section 41-26-106 is amended to read:
187 41-26-106. On-demand autonomous vehicle network.
188 (1) Subject to Subsection (2), an on-demand autonomous vehicle network may only
189 operate pursuant to state laws governing the operation of ground transportation for-hire under
190 state law, including:
191 (a) a transportation network company [
192 Transportation Network Company Registration Act;
193 (b) a public transit district as defined in Section 17B-2a-802; or
194 (c) a private passenger carrier as defined in Section 53-3-102.
195 (2) Any provision of state law described in Subsection (1) that reasonably applies only
196 to a human driver, including Subsection 13-51-105(5)(b), shall not apply to the operation of a
197 vehicle by an engaged level four or five ADS that is part of an on-demand autonomous vehicle
198 network.
199 Section 10. Section 59-12-603 is amended to read:
200 59-12-603. County tax -- Bases -- Rates -- Use of revenue -- Adoption of ordinance
201 required -- Advisory board -- Administration -- Collection -- Administrative charge --
202 Distribution -- Enactment or repeal of tax or tax rate change -- Effective date -- Notice
203 requirements.
204 (1) (a) [
205 county legislative body may, as provided in this part, impose a tax as follows:
206 (i) (A) a county legislative body of any county may impose a tax of not to exceed 3%
207 on all short-term rentals of motor vehicles, except for short-term rentals of motor vehicles
208 made for the purpose of temporarily replacing a person's motor vehicle that is being repaired
209 pursuant to a repair or an insurance agreement; and
210 (B) a county legislative body of any county imposing a tax under Subsection
211 (1)(a)(i)(A) may, in addition to imposing the tax under Subsection (1)(a)(i)(A), impose a tax of
212 not to exceed 4% on all short-term rentals of motor vehicles, except for short-term rentals of
213 motor vehicles made for the purpose of temporarily replacing a person's motor vehicle that is
214 being repaired pursuant to a repair or an insurance agreement;
215 (ii) beginning on January 1, 2021, a county legislative body of any county may impose
216 a tax of not to exceed 7% on all short-term rentals of off-highway vehicles and recreational
217 vehicles;
218 (iii) a county legislative body of any county may impose a tax of not to exceed 1% of
219 all sales of the following that are sold by a restaurant:
220 (A) alcoholic beverages;
221 (B) food and food ingredients; or
222 (C) prepared food; and
223 (iv) a county legislative body of a county of the first class may impose a tax of not to
224 exceed .5% on charges for the accommodations and services described in Subsection
225 59-12-103(1)(i).
226 (b) A tax imposed under Subsection (1)(a) is subject to the audit provisions of Section
227 17-31-5.5.
228 (c) A county may not impose a tax described in Subsection (1)(a) on:
229 (i) a peer-to-peer car sharing transaction as defined in Section 13-51-302;
230 (ii) a peer-to-peer car sharing company as defined in Section 13-51-302; or
231 (iii) a shared vehicle owner as defined in Section 13-51-302.
232 (2) (a) Subject to Subsection (2)(b), a county may use revenue from the imposition of a
233 tax under Subsection (1) for:
234 (i) financing tourism promotion; and
235 (ii) the development, operation, and maintenance of:
236 (A) an airport facility;
237 (B) a convention facility;
238 (C) a cultural facility;
239 (D) a recreation facility; or
240 (E) a tourist facility.
241 (b) A county of the first class shall expend at least $450,000 each year of the revenue
242 from the imposition of a tax authorized by Subsection (1)(a)(iv) within the county to fund a
243 marketing and ticketing system designed to:
244 (i) promote tourism in ski areas within the county by persons that do not reside within
245 the state; and
246 (ii) combine the sale of:
247 (A) ski lift tickets; and
248 (B) accommodations and services described in Subsection 59-12-103(1)(i).
249 (3) A tax imposed under this part may be pledged as security for bonds, notes, or other
250 evidences of indebtedness incurred by a county, city, or town under Title 11, Chapter 14, Local
251 Government Bonding Act, or a community reinvestment agency under Title 17C, Chapter 1,
252 Part 5, Agency Bonds, to finance:
253 (a) an airport facility;
254 (b) a convention facility;
255 (c) a cultural facility;
256 (d) a recreation facility; or
257 (e) a tourist facility.
258 (4) (a) To impose a tax under Subsection (1), the county legislative body shall adopt an
259 ordinance imposing the tax.
260 (b) The ordinance under Subsection (4)(a) shall include provisions substantially the
261 same as those contained in Part 1, Tax Collection, except that the tax shall be imposed only on
262 those items and sales described in Subsection (1).
263 (c) The name of the county as the taxing agency shall be substituted for that of the state
264 where necessary, and an additional license is not required if one has been or is issued under
265 Section 59-12-106.
266 (5) To maintain in effect a tax ordinance adopted under this part, each county
267 legislative body shall, within 30 days of any amendment of any applicable provisions of Part 1,
268 Tax Collection, adopt amendments to the county's tax ordinance to conform with the applicable
269 amendments to Part 1, Tax Collection.
270 (6) (a) Regardless of whether a county of the first class creates a tourism tax advisory
271 board in accordance with Section 17-31-8, the county legislative body of the county of the first
272 class shall create a tax advisory board in accordance with this Subsection (6).
273 (b) The tax advisory board shall be composed of nine members appointed as follows:
274 (i) four members shall be residents of a county of the first class appointed by the
275 county legislative body of the county of the first class; and
276 (ii) subject to Subsections (6)(c) and (d), five members shall be mayors of cities or
277 towns within the county of the first class appointed by an organization representing all mayors
278 of cities and towns within the county of the first class.
279 (c) Five members of the tax advisory board constitute a quorum.
280 (d) The county legislative body of the county of the first class shall determine:
281 (i) terms of the members of the tax advisory board;
282 (ii) procedures and requirements for removing a member of the tax advisory board;
283 (iii) voting requirements, except that action of the tax advisory board shall be by at
284 least a majority vote of a quorum of the tax advisory board;
285 (iv) chairs or other officers of the tax advisory board;
286 (v) how meetings are to be called and the frequency of meetings; and
287 (vi) the compensation, if any, of members of the tax advisory board.
288 (e) The tax advisory board under this Subsection (6) shall advise the county legislative
289 body of the county of the first class on the expenditure of revenue collected within the county
290 of the first class from the taxes described in Subsection (1)(a).
291 (7) (a) (i) Except as provided in Subsection (7)(a)(ii), a tax authorized under this part
292 shall be administered, collected, and enforced in accordance with:
293 (A) the same procedures used to administer, collect, and enforce the tax under:
294 (I) Part 1, Tax Collection; or
295 (II) Part 2, Local Sales and Use Tax Act; and
296 (B) Chapter 1, General Taxation Policies.
297 (ii) A tax under this part is not subject to Section 59-12-107.1 or 59-12-123 or
298 Subsections 59-12-205(2) through (6).
299 (b) Except as provided in Subsection (7)(c):
300 (i) for a tax under this part other than the tax under Subsection (1)(a)(i)(B), the
301 commission shall distribute the revenue to the county imposing the tax; and
302 (ii) for a tax under Subsection (1)(a)(i)(B), the commission shall distribute the revenue
303 according to the distribution formula provided in Subsection (8).
304 (c) The commission shall retain and deposit an administrative charge in accordance
305 with Section 59-1-306 from the revenue the commission collects from a tax under this part.
306 (8) The commission shall distribute the revenue generated by the tax under Subsection
307 (1)(a)(i)(B) to each county collecting a tax under Subsection (1)(a)(i)(B) according to the
308 following formula:
309 (a) the commission shall distribute 70% of the revenue based on the percentages
310 generated by dividing the revenue collected by each county under Subsection (1)(a)(i)(B) by
311 the total revenue collected by all counties under Subsection (1)(a)(i)(B); and
312 (b) the commission shall distribute 30% of the revenue based on the percentages
313 generated by dividing the population of each county collecting a tax under Subsection
314 (1)(a)(i)(B) by the total population of all counties collecting a tax under Subsection (1)(a)(i)(B).
315 (9) (a) For purposes of this Subsection (9):
316 (i) "Annexation" means an annexation to a county under Title 17, Chapter 2, Part 2,
317 County Annexation.
318 (ii) "Annexing area" means an area that is annexed into a county.
319 (b) (i) Except as provided in Subsection (9)(c), if a county enacts or repeals a tax or
320 changes the rate of a tax under this part, the enactment, repeal, or change shall take effect:
321 (A) on the first day of a calendar quarter; and
322 (B) after a 90-day period beginning on the day on which the commission receives
323 notice meeting the requirements of Subsection (9)(b)(ii) from the county.
324 (ii) The notice described in Subsection (9)(b)(i)(B) shall state:
325 (A) that the county will enact or repeal a tax or change the rate of a tax under this part;
326 (B) the statutory authority for the tax described in Subsection (9)(b)(ii)(A);
327 (C) the effective date of the tax described in Subsection (9)(b)(ii)(A); and
328 (D) if the county enacts the tax or changes the rate of the tax described in Subsection
329 (9)(b)(ii)(A), the rate of the tax.
330 (c) (i) If the billing period for a transaction begins before the effective date of the
331 enactment of the tax or the tax rate increase imposed under Subsection (1), the enactment of
332 the tax or the tax rate increase shall take effect on the first day of the first billing period that
333 begins after the effective date of the enactment of the tax or the tax rate increase.
334 (ii) If the billing period for a transaction begins before the effective date of the repeal
335 of the tax or the tax rate decrease imposed under Subsection (1), the repeal of the tax or the tax
336 rate decrease shall take effect on the first day of the last billing period that began before the
337 effective date of the repeal of the tax or the tax rate decrease.
338 (d) (i) Except as provided in Subsection (9)(e), if the annexation will result in the
339 enactment, repeal, or change in the rate of a tax under this part for an annexing area, the
340 enactment, repeal, or change shall take effect:
341 (A) on the first day of a calendar quarter; and
342 (B) after a 90-day period beginning on the day on which the commission receives
343 notice meeting the requirements of Subsection (9)(d)(ii) from the county that annexes the
344 annexing area.
345 (ii) The notice described in Subsection (9)(d)(i)(B) shall state:
346 (A) that the annexation described in Subsection (9)(d)(i) will result in an enactment,
347 repeal, or change in the rate of a tax under this part for the annexing area;
348 (B) the statutory authority for the tax described in Subsection (9)(d)(ii)(A);
349 (C) the effective date of the tax described in Subsection (9)(d)(ii)(A); and
350 (D) if the county enacts the tax or changes the rate of the tax described in Subsection
351 (9)(d)(ii)(A), the rate of the tax.
352 (e) (i) If the billing period for a transaction begins before the effective date of the
353 enactment of the tax or the tax rate increase imposed under Subsection (1), the enactment of
354 the tax or the tax rate increase shall take effect on the first day of the first billing period that
355 begins after the effective date of the enactment of the tax or the tax rate increase.
356 (ii) If the billing period for a transaction begins before the effective date of the repeal
357 of the tax or the tax rate decrease imposed under Subsection (1), the repeal of the tax or the tax
358 rate decrease shall take effect on the first day of the last billing period that began before the
359 effective date of the repeal of the tax or the tax rate decrease.
360 Section 11. Section 59-12-1201 is amended to read:
361 59-12-1201. Motor vehicle rental tax -- Rate -- Exemptions -- Administration,
362 collection, and enforcement of tax -- Administrative charge -- Deposits.
363 (1) (a) Except as provided in Subsection (3), there is imposed a tax of 2.5% on all
364 short-term leases and rentals of motor vehicles not exceeding 30 days.
365 (b) The tax imposed in this section is in addition to all other state, county, or municipal
366 fees and taxes imposed on rentals of motor vehicles.
367 (2) (a) Subject to Subsection (2)(b), a tax rate repeal or tax rate change for the tax
368 imposed under Subsection (1) shall take effect on the first day of a calendar quarter.
369 (b) (i) For a transaction subject to a tax under Subsection (1), a tax rate increase shall
370 take effect on the first day of the first billing period:
371 (A) that begins after the effective date of the tax rate increase; and
372 (B) if the billing period for the transaction begins before the effective date of a tax rate
373 increase imposed under Subsection (1).
374 (ii) For a transaction subject to a tax under Subsection (1), the repeal of a tax or a tax
375 rate decrease shall take effect on the first day of the last billing period:
376 (A) that began before the effective date of the repeal of the tax or the tax rate decrease;
377 and
378 (B) if the billing period for the transaction begins before the effective date of the repeal
379 of the tax or the tax rate decrease imposed under Subsection (1).
380 (3) A motor vehicle is exempt from the tax imposed under Subsection (1) if:
381 (a) the motor vehicle is registered for a gross laden weight of 12,001 or more pounds;
382 (b) the motor vehicle is rented as a personal household goods moving van; [
383 (c) the lease or rental of the motor vehicle is made for the purpose of temporarily
384 replacing a person's motor vehicle that is being repaired pursuant to a repair agreement or an
385 insurance agreement[
386 (d) the sharing of the motor vehicle is a peer-to-peer car sharing transaction as defined
387 in Section 13-51-302.
388 (4) (a) (i) The tax authorized under this section shall be administered, collected, and
389 enforced in accordance with:
390 (A) the same procedures used to administer, collect, and enforce the tax under Part 1,
391 Tax Collection; and
392 (B) Chapter 1, General Taxation Policies.
393 (ii) Notwithstanding Subsection (4)(a)(i), a tax under this part is not subject to
394 Subsections 59-12-103(4) through (10) or Section 59-12-107.1 or 59-12-123.
395 (b) The commission shall retain and deposit an administrative charge in accordance
396 with Section 59-1-306 from the revenues the commission collects from a tax under this part.
397 (c) Except as provided under Subsection (4)(b), all revenue received by the
398 commission under this section shall be deposited daily with the state treasurer and credited
399 monthly to the Marda Dillree Corridor Preservation Fund under Section 72-2-117.