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7 LONG TITLE
8 General Description:
9 This bill amends provisions related to county taxes.
10 Highlighted Provisions:
11 This bill:
12 ▸ allows all counties to expend transient room tax revenue for certain purposes related
13 to tourism mitigation, including criminal justice activities and equipment;
14 ▸ allows counties to expend tourism, recreation, cultural, convention, and airport
15 facilities tax revenue for certain purposes related to tourism mitigation; and
16 ▸ makes conforming changes.
17 Money Appropriated in this Bill:
18 None
19 Other Special Clauses:
20 None
21 Utah Code Sections Affected:
22 AMENDS:
23 17-31-2, as last amended by Laws of Utah 2020, Chapter 315
24 17-31-5.5, as last amended by Laws of Utah 2020, Chapter 315
25 59-12-603, as last amended by Laws of Utah 2020, Chapter 407
26
27 Be it enacted by the Legislature of the state of Utah:
28 Section 1. Section 17-31-2 is amended to read:
29 17-31-2. Purposes of transient room tax and expenditure of revenue -- Purchase
30 or lease of facilities -- Mitigating impacts of recreation, tourism, or conventions --
31 Issuance of bonds.
32 (1) As used in this section:
33 (a) "Aircraft" means the same as that term is defined in Section 72-10-102.
34 (b) "Airport" means the same as that term is defined in Section 72-10-102.
35 (c) "Airport authority" means the same as that term is defined in Section 72-10-102.
36 (d) "Airport operator" means the same as that term is defined in Section 72-10-102.
37 (e) "Base year revenue" means the amount of revenue generated by a transient room tax
38 and collected by a county for fiscal year 2018-19.
39 (f) "Base year promotion expenditure" means the amount of revenue generated by a
40 transient room tax that a county spent for the purpose described in Subsection (2)(a) during
41 fiscal year 2018-19.
42 (g) "Eligible town" means a town that:
43 (i) is located within a county that has a national park within or partially within the
44 county's boundaries; and
45 (ii) imposes a resort communities tax authorized by Section 59-12-401.
46 (h) "Emergency medical services provider" means an eligible town, a local district, or a
47 special service district.
48 (i) "Town" means a municipality that is classified as a town in accordance with Section
49 10-2-301.
50 (j) "Transient room tax" means a tax at a rate not to exceed 4.25% authorized by
51 Section 59-12-301.
52 (2) Subject to the requirements of this section, a county legislative body may impose
53 the transient room tax for the purposes of:
54 (a) establishing and promoting recreation, tourism, film production, and conventions;
55 (b) acquiring, leasing, constructing, furnishing, maintaining, or operating:
56 (i) convention meeting rooms;
57 (ii) exhibit halls;
58 (iii) visitor information centers;
59 (iv) museums;
60 (v) sports and recreation facilities including practice fields, stadiums, and arenas;
61 (vi) related facilities;
62 (vii) if a national park is located within or partially within the county, the following on
63 any route designated by the county legislative body:
64 (A) transit service, including shuttle service; and
65 (B) parking infrastructure; and
66 (viii) an airport, if:
67 (A) the county is a county of the fourth, fifth, or sixth class; and
68 (B) the county is the airport operator of the airport;
69 (c) acquiring land, leasing land, or making payments for construction or infrastructure
70 improvements required for or related to the purposes listed in Subsection (2)(b);
71 (d) as required to mitigate the impacts of recreation, tourism, or conventions [
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73 (i) solid waste disposal operations;
74 (ii) emergency medical services and equipment;
75 (iii) search and rescue activities and equipment;
76 (iv) law enforcement activities[
77 (v) criminal justice activities and equipment; and
78 [
79 (A) class B roads, as defined in Section 72-3-103;
80 (B) class C roads, as defined in Section 72-3-104; or
81 (C) class D roads, as defined in Section 72-3-105; and
82 (e) making the annual payment of principal, interest, premiums, and necessary reserves
83 for any of the aggregate of bonds authorized under Subsection (5).
84 (3) (a) The county legislative body of a county that imposes a transient room tax at a
85 rate of 3% or less may expend the revenue generated as provided in Subsection (4), after
86 making any reduction required by Subsection (6).
87 (b) The county legislative body of a county that imposes a transient room tax at a rate
88 that exceeds 3% or increases the rate of transient room tax above 3% may expend:
89 (i) the revenue generated from the transient room tax at a rate of 3% as provided in
90 Subsection (4), after making any reduction required by Subsection (6); and
91 (ii) the revenue generated from the portion of the rate that exceeds 3%:
92 (A) for any combination of the purposes described in Subsections (2) and (5); and
93 (B) regardless of the limitation on expenditures for the purposes described in
94 Subsection (4).
95 (4) Subject to Subsection (6), a county may not expend more than 1/3 of the revenue
96 generated by a rate of transient room tax that does not exceed 3%, for any combination of the
97 purposes described in Subsections (2)(b) through (2)(e).
98 (5) (a) The county legislative body may issue bonds or cause bonds to be issued, as
99 permitted by law, to pay all or part of any costs incurred for the purposes set forth in
100 Subsections (2)(b) through (2)(d) that are permitted to be paid from bond proceeds.
101 (b) If a county legislative body does not need the revenue generated by the transient
102 room tax for payment of principal, interest, premiums, and reserves on bonds issued as
103 provided in Subsection (2)(e), the county legislative body shall expend that revenue for the
104 purposes described in Subsection (2), subject to the limitation of Subsection (4).
105 (6) (a) In addition to the purposes described in Subsection (2), a county legislative
106 body may expend up to 4% of the total revenue generated by a transient room tax to pay a
107 provider for emergency medical services in one or more eligible towns.
108 (b) A county legislative body shall reduce the amount that the county is authorized to
109 expend for the purposes described in Subsection (4) by subtracting the amount of transient
110 room tax revenue expended in accordance with Subsection (6)(a) from the amount of revenue
111 described in Subsection (4).
112 (7) (a) A county legislative body in a county of the fourth, fifth, or sixth class shall
113 expend the revenue generated by a transient room tax as follows:
114 (i) an amount equal to the county's base year promotion expenditure for the purpose
115 described in Subsection (2)(a);
116 (ii) an amount equal to the difference between the county's base year revenue and the
117 county's base year promotion expenditure in accordance with Subsections (3) through (6); and
118 (iii) (A) 37% of the revenue that exceeds the county's base year revenue for the purpose
119 described in Subsection (2)(a); and
120 (B) subject to Subsection (7)(b), 63% of the revenue that exceeds the county's base
121 year revenue for any combination of the purposes described in Subsections (2)(b) through (e)
122 or to pay an emergency medical services provider for emergency medical services in one or
123 more eligible towns.
124 (b) A county legislative body in a county of the fourth, fifth, or sixth class may not:
125 (i) expend more than 4% of the revenue generated by a transient room tax to pay an
126 emergency medical services provider for emergency medical services in one or more eligible
127 towns; or
128 (ii) expend revenue generated by a transient room tax for the purpose described in
129 Subsection (2)(e) in an amount that exceeds the county's base year promotion expenditure.
130 (c) The provisions of this Subsection (7) apply notwithstanding any other provision of
131 this section.
132 (d) If the total amount of revenue generated by a transient room tax in a county of the
133 fourth, fifth, or sixth class is less than the county's base year promotion expenditure:
134 (i) Subsections (7)(a) through (c) do not apply; and
135 (ii) the county legislative body shall expend the revenue generated by the transient
136 room tax in accordance with Subsections (3) through (6).
137 Section 2. Section 17-31-5.5 is amended to read:
138 17-31-5.5. Report to county legislative body -- Content.
139 (1) The legislative body of each county that imposes a transient room tax under Section
140 59-12-301 or a tourism, recreation, cultural, convention, and airport facilities tax under Section
141 59-12-603 shall prepare annually a report in accordance with Subsection (2).
142 (2) The report described in Subsection (1) shall include a breakdown of expenditures
143 into the following categories:
144 (a) for the transient room tax, identification of expenditures for:
145 (i) establishing and promoting:
146 (A) recreation;
147 (B) tourism;
148 (C) film production; and
149 (D) conventions;
150 (ii) acquiring, leasing, constructing, furnishing, or operating:
151 (A) convention meeting rooms;
152 (B) exhibit halls;
153 (C) visitor information centers;
154 (D) museums; and
155 (E) related facilities;
156 (iii) acquiring or leasing land required for or related to the purposes listed in
157 Subsection (2)(a)(ii);
158 (iv) mitigation costs as identified in Subsection 17-31-2(2)(d); and
159 (v) making the annual payment of principal, interest, premiums, and necessary reserves
160 for any or the aggregate of bonds issued to pay for costs referred to in Subsections
161 17-31-2(2)(e) and (5)(a); and
162 (b) for the tourism, recreation, cultural, convention, and airport facilities tax,
163 identification of expenditures for:
164 (i) financing tourism promotion, which means an activity to develop, encourage,
165 solicit, or market tourism that attracts transient guests to the county, including planning,
166 product development, and advertising;
167 (ii) the development, operation, and maintenance of the following facilities as defined
168 in Section 59-12-602:
169 (A) an airport facility;
170 (B) a convention facility;
171 (C) a cultural facility;
172 (D) a recreation facility; and
173 (E) a tourist facility; [
174 (iii) a pledge as security for evidences of indebtedness under Subsection
175 59-12-603(3)[
176 (iv) mitigation costs as identified in Subsection 59-12-603(2)(a)(iii).
177 (3) For the transient room tax, the report described in Subsection (1) shall include a
178 breakdown of each expenditure described in Subsection (2)(a)(i), including:
179 (a) whether the expenditure was used for in-state and out-of-state promotion efforts;
180 (b) an explanation of how the expenditure targeted a cost created by tourism; and
181 (c) an accounting of the expenditure showing that the expenditure was used only for
182 costs directly related to a cost created by tourism.
183 (4) A county legislative body shall provide a copy of the report described in Subsection
184 (1) to:
185 (a) the Utah Office of Tourism within the Governor's Office of Economic
186 Development;
187 (b) its tourism tax advisory board; and
188 (c) the Office of the Legislative Fiscal Analyst.
189 Section 3. Section 59-12-603 is amended to read:
190 59-12-603. County tax -- Bases -- Rates -- Use of revenue -- Adoption of ordinance
191 required -- Advisory board -- Administration -- Collection -- Administrative charge --
192 Distribution -- Enactment or repeal of tax or tax rate change -- Effective date -- Notice
193 requirements.
194 (1) (a) In addition to any other taxes, a county legislative body may, as provided in this
195 part, impose a tax as follows:
196 (i) (A) a county legislative body of any county may impose a tax of not to exceed 3%
197 on all short-term rentals of motor vehicles, except for short-term rentals of motor vehicles
198 made for the purpose of temporarily replacing a person's motor vehicle that is being repaired
199 pursuant to a repair or an insurance agreement; and
200 (B) a county legislative body of any county imposing a tax under Subsection
201 (1)(a)(i)(A) may, in addition to imposing the tax under Subsection (1)(a)(i)(A), impose a tax of
202 not to exceed 4% on all short-term rentals of motor vehicles, except for short-term rentals of
203 motor vehicles made for the purpose of temporarily replacing a person's motor vehicle that is
204 being repaired pursuant to a repair or an insurance agreement;
205 (ii) beginning on January 1, 2021, a county legislative body of any county may impose
206 a tax of not to exceed 7% on all short-term rentals of off-highway vehicles and recreational
207 vehicles;
208 (iii) a county legislative body of any county may impose a tax of not to exceed 1% of
209 all sales of the following that are sold by a restaurant:
210 (A) alcoholic beverages;
211 (B) food and food ingredients; or
212 (C) prepared food; and
213 (iv) a county legislative body of a county of the first class may impose a tax of not to
214 exceed .5% on charges for the accommodations and services described in Subsection
215 59-12-103(1)(i).
216 (b) A tax imposed under Subsection (1)(a) is subject to the audit provisions of Section
217 17-31-5.5.
218 (2) (a) Subject to Subsection (2)(b), a county may use revenue from the imposition of a
219 tax under Subsection (1) for:
220 (i) financing tourism promotion; [
221 (ii) the development, operation, and maintenance of:
222 (A) an airport facility;
223 (B) a convention facility;
224 (C) a cultural facility;
225 (D) a recreation facility; or
226 (E) a tourist facility[
227 (iii) mitigating the impacts of recreation, tourism, or conventions, paying for:
228 (A) solid waste disposal operations;
229 (B) emergency medical services and equipment;
230 (C) search and rescue activities and equipment;
231 (D) law enforcement activities and equipment;
232 (E) criminal justice activities and equipment; and
233 (F) road repair and upgrade of class B roads as defined in Section 72-3-103, class C
234 roads as defined in Section 72-3-104, or class D roads as defined in Section 72-3-105.
235 (b) A county of the first class shall expend at least $450,000 each year of the revenue
236 from the imposition of a tax authorized by Subsection (1)(a)(iv) within the county to fund a
237 marketing and ticketing system designed to:
238 (i) promote tourism in ski areas within the county by persons that do not reside within
239 the state; and
240 (ii) combine the sale of:
241 (A) ski lift tickets; and
242 (B) accommodations and services described in Subsection 59-12-103(1)(i).
243 (3) A tax imposed under this part may be pledged as security for bonds, notes, or other
244 evidences of indebtedness incurred by a county, city, or town under Title 11, Chapter 14, Local
245 Government Bonding Act, or a community reinvestment agency under Title 17C, Chapter 1,
246 Part 5, Agency Bonds, to finance:
247 (a) an airport facility;
248 (b) a convention facility;
249 (c) a cultural facility;
250 (d) a recreation facility; or
251 (e) a tourist facility.
252 (4) (a) To impose a tax under Subsection (1), the county legislative body shall adopt an
253 ordinance imposing the tax.
254 (b) The ordinance under Subsection (4)(a) shall include provisions substantially the
255 same as those contained in Part 1, Tax Collection, except that the tax shall be imposed only on
256 those items and sales described in Subsection (1).
257 (c) The name of the county as the taxing agency shall be substituted for that of the state
258 where necessary, and an additional license is not required if one has been or is issued under
259 Section 59-12-106.
260 (5) To maintain in effect a tax ordinance adopted under this part, each county
261 legislative body shall, within 30 days of any amendment of any applicable provisions of Part 1,
262 Tax Collection, adopt amendments to the county's tax ordinance to conform with the applicable
263 amendments to Part 1, Tax Collection.
264 (6) (a) Regardless of whether a county of the first class creates a tourism tax advisory
265 board in accordance with Section 17-31-8, the county legislative body of the county of the first
266 class shall create a tax advisory board in accordance with this Subsection (6).
267 (b) The tax advisory board shall be composed of nine members appointed as follows:
268 (i) four members shall be residents of a county of the first class appointed by the
269 county legislative body of the county of the first class; and
270 (ii) subject to Subsections (6)(c) and (d), five members shall be mayors of cities or
271 towns within the county of the first class appointed by an organization representing all mayors
272 of cities and towns within the county of the first class.
273 (c) Five members of the tax advisory board constitute a quorum.
274 (d) The county legislative body of the county of the first class shall determine:
275 (i) terms of the members of the tax advisory board;
276 (ii) procedures and requirements for removing a member of the tax advisory board;
277 (iii) voting requirements, except that action of the tax advisory board shall be by at
278 least a majority vote of a quorum of the tax advisory board;
279 (iv) chairs or other officers of the tax advisory board;
280 (v) how meetings are to be called and the frequency of meetings; and
281 (vi) the compensation, if any, of members of the tax advisory board.
282 (e) The tax advisory board under this Subsection (6) shall advise the county legislative
283 body of the county of the first class on the expenditure of revenue collected within the county
284 of the first class from the taxes described in Subsection (1)(a).
285 (7) (a) (i) Except as provided in Subsection (7)(a)(ii), a tax authorized under this part
286 shall be administered, collected, and enforced in accordance with:
287 (A) the same procedures used to administer, collect, and enforce the tax under:
288 (I) Part 1, Tax Collection; or
289 (II) Part 2, Local Sales and Use Tax Act; and
290 (B) Chapter 1, General Taxation Policies.
291 (ii) A tax under this part is not subject to Section 59-12-107.1 or 59-12-123 or
292 Subsections 59-12-205(2) through (6).
293 (b) Except as provided in Subsection (7)(c):
294 (i) for a tax under this part other than the tax under Subsection (1)(a)(i)(B), the
295 commission shall distribute the revenue to the county imposing the tax; and
296 (ii) for a tax under Subsection (1)(a)(i)(B), the commission shall distribute the revenue
297 according to the distribution formula provided in Subsection (8).
298 (c) The commission shall retain and deposit an administrative charge in accordance
299 with Section 59-1-306 from the revenue the commission collects from a tax under this part.
300 (8) The commission shall distribute the revenue generated by the tax under Subsection
301 (1)(a)(i)(B) to each county collecting a tax under Subsection (1)(a)(i)(B) according to the
302 following formula:
303 (a) the commission shall distribute 70% of the revenue based on the percentages
304 generated by dividing the revenue collected by each county under Subsection (1)(a)(i)(B) by
305 the total revenue collected by all counties under Subsection (1)(a)(i)(B); and
306 (b) the commission shall distribute 30% of the revenue based on the percentages
307 generated by dividing the population of each county collecting a tax under Subsection
308 (1)(a)(i)(B) by the total population of all counties collecting a tax under Subsection (1)(a)(i)(B).
309 (9) (a) For purposes of this Subsection (9):
310 (i) "Annexation" means an annexation to a county under Title 17, Chapter 2, Part 2,
311 County Annexation.
312 (ii) "Annexing area" means an area that is annexed into a county.
313 (b) (i) Except as provided in Subsection (9)(c), if a county enacts or repeals a tax or
314 changes the rate of a tax under this part, the enactment, repeal, or change shall take effect:
315 (A) on the first day of a calendar quarter; and
316 (B) after a 90-day period beginning on the day on which the commission receives
317 notice meeting the requirements of Subsection (9)(b)(ii) from the county.
318 (ii) The notice described in Subsection (9)(b)(i)(B) shall state:
319 (A) that the county will enact or repeal a tax or change the rate of a tax under this part;
320 (B) the statutory authority for the tax described in Subsection (9)(b)(ii)(A);
321 (C) the effective date of the tax described in Subsection (9)(b)(ii)(A); and
322 (D) if the county enacts the tax or changes the rate of the tax described in Subsection
323 (9)(b)(ii)(A), the rate of the tax.
324 (c) (i) If the billing period for a transaction begins before the effective date of the
325 enactment of the tax or the tax rate increase imposed under Subsection (1), the enactment of
326 the tax or the tax rate increase shall take effect on the first day of the first billing period that
327 begins after the effective date of the enactment of the tax or the tax rate increase.
328 (ii) If the billing period for a transaction begins before the effective date of the repeal
329 of the tax or the tax rate decrease imposed under Subsection (1), the repeal of the tax or the tax
330 rate decrease shall take effect on the first day of the last billing period that began before the
331 effective date of the repeal of the tax or the tax rate decrease.
332 (d) (i) Except as provided in Subsection (9)(e), if the annexation will result in the
333 enactment, repeal, or change in the rate of a tax under this part for an annexing area, the
334 enactment, repeal, or change shall take effect:
335 (A) on the first day of a calendar quarter; and
336 (B) after a 90-day period beginning on the day on which the commission receives
337 notice meeting the requirements of Subsection (9)(d)(ii) from the county that annexes the
338 annexing area.
339 (ii) The notice described in Subsection (9)(d)(i)(B) shall state:
340 (A) that the annexation described in Subsection (9)(d)(i) will result in an enactment,
341 repeal, or change in the rate of a tax under this part for the annexing area;
342 (B) the statutory authority for the tax described in Subsection (9)(d)(ii)(A);
343 (C) the effective date of the tax described in Subsection (9)(d)(ii)(A); and
344 (D) if the county enacts the tax or changes the rate of the tax described in Subsection
345 (9)(d)(ii)(A), the rate of the tax.
346 (e) (i) If the billing period for a transaction begins before the effective date of the
347 enactment of the tax or the tax rate increase imposed under Subsection (1), the enactment of
348 the tax or the tax rate increase shall take effect on the first day of the first billing period that
349 begins after the effective date of the enactment of the tax or the tax rate increase.
350 (ii) If the billing period for a transaction begins before the effective date of the repeal
351 of the tax or the tax rate decrease imposed under Subsection (1), the repeal of the tax or the tax
352 rate decrease shall take effect on the first day of the last billing period that began before the
353 effective date of the repeal of the tax or the tax rate decrease.