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PAG LIN 1 1 Section 1. NEW SECTION. 422E.1 PURPOSE. 1 2 The purpose of this chapter is to authorize school 1 3 districts having the authority to issue bonds to impose a debt 1 4 service income surtax in order to fund, in whole or in part, 1 5 the issuance of bonds approved by the electorate of the school 1 6 district pursuant to chapter 75. A school district is 1 7 authorized to impose a debt service income surtax only if the 1 8 proposition to impose the income surtax is approved by the 1 9 electors as provided in section 75.1, subsection 2. 1 10 Sec. 2. NEW SECTION. 422E.2 SCHOOL BOND FINANCING FUND. 1 11 A school bond financing fund is created in the office of 1 12 treasurer of state under the control of the department of 1 13 revenue and finance. The director of revenue and finance 1 14 shall deposit all moneys received from a debt service income 1 15 surtax imposed pursuant to this chapter to the local bond 1 16 financing fund. A separate accounting of each income surtax 1 17 imposed by a school district pursuant to this chapter shall be 1 18 maintained. 1 19 Sec. 3. NEW SECTION. 422E.3 ADMINISTRATION – INCOME 1 20 SURTAX. 1 21 1. The debt service income surtax authorized under this 1 22 chapter shall be imposed on the state individual income tax 1 23 for each calendar year, or for a taxpayer's fiscal year ending 1 24 during the second half of that calendar year or the first half 1 25 of the succeeding calendar year, and shall be imposed on all 1 26 state individual income taxpayers residing within the school 1 27 district's boundaries on the last day of the applicable tax 1 28 year. 1 29 As used in this section, "state individual income tax" 1 30 means the tax computed under section 422.5, less the credits 1 31 allowed in sections 422.11A, 422.11B, 422.12, and 422.12B. 1 32 2. The director of revenue and finance shall administer 1 33 the debt service income surtax imposed under this chapter as 1 34 nearly as possible in conjunction with the administration of 1 35 state income tax laws. All powers and requirements of the 2 1 director in administering the state income tax law apply to 2 2 the administration of a debt service income surtax. The debt 2 3 service income surtax shall be made a part of the Iowa 2 4 individual income tax return subject to the conditions and 2 5 restrictions set forth in section 422.21. 2 6 Sec. 4. NEW SECTION. 422E.4 PAYMENTS TO SCHOOL DISTRICTS 2 7 – DEBT SERVICE INCOME SURTAX. 2 8 1. On or before November 1, the director of revenue and 2 9 finance shall make an accounting of the debt service income 2 10 surtax receipts and any interest and penalties collected on or 2 11 before November 1 from returns filed for the preceding year 2 12 and shall certify to the treasurer of state the amount 2 13 collected. After crediting to the department of revenue and 2 14 finance a reasonable amount for costs of administration, the 2 15 director of revenue and finance shall draw warrants in payment 2 16 of the surtaxes collected for each school district imposing 2 17 the income surtax. Warrants shall be payable in two 2 18 installments to be paid on approximately the first day of 2 19 December and the first day of February following collection of 2 20 the taxes and shall be delivered to the respective school 2 21 districts. 2 22 2. Moneys received by a school district pursuant to this 2 23 chapter shall be deposited in a separate debt service income 2 24 surtax fund within the general fund of the school district and 2 25 shall not be commingled with moneys collected and deposited 2 26 for the retirement of any other debt and shall be used only 2 27 for the purpose for which voted. 2 28 3. The costs of administration shall be determined by the 2 29 department of revenue and finance, and shall be based on a 2 30 share of the total cost of administering the department, in 2 31 the same proportion as the amount of debt service income 2 32 surtax collected is to the amount of state income taxes 2 33 collected. 2 34 Sec. 5. Section 75.1, Code 1997, is amended to read as 2 35 follows: 3 1 75.1 BONDS – ELECTION – VOTE REQUIRED. 3 2 1.WhenIf a proposition to authorize an issuance of bonds 3 3 by a county, township, school corporation, city, or by any 3 4 local board or commission, is submitted to the electors, such 3 5 proposition shall not be deemedcarried oradopted, anything 3 6 in the statutes to the contrary notwithstanding, unless the 3 7 vote in favor of such authorization is equal to at least sixty 3 8 percent of the total vote cast for and againstsaidthe 3 9 proposition atsaidthe election. 3 10 2. If the board of directors of a school district elects 3 11 to fund, in whole or in part, the issuance of bonds with 3 12 revenues from a debt service income surtax, the ballot 3 13 proposition to authorize the issuance of the bonds shall state 3 14 that a debt service income surtax will be imposed to fund the 3 15 issuance of the bonds, and the proposition shall state the 3 16 rate at which the surtax will be imposed, and the duration of 3 17 the surtax. A ballot proposition which states that the 3 18 issuance of bonds shall be funded, in whole or in part, by a 3 19 debt service income surtax shall be deemed adopted if the vote 3 20 in favor of the proposition is equal to at least sixty percent 3 21 of the total vote cast for and against the proposition at the 3 22 election. 3 23 3. All ballots cast and not counted as a vote for or 3 24 against the proposition shall not be used in computing the 3 25 total vote cast for and againstsaidthe proposition. 3 26 4. When a proposition to authorize an issuance of bonds 3 27 has been submitted to the electors under this section and the 3 28 proposal fails to gain approval by the required percentage of 3 29 votes, such proposal, or any proposal which incorporates any 3 30 portion of the defeated proposal, shall not be submitted to 3 31 the electors for a period of six months from the date of such 3 32 regular or special election. 3 33 Sec. 6. Section 76.1, Code 1997, is amended to read as 3 34 follows: 3 35 76.1 MANDATORY RETIREMENT. 4 1Hereafter issuesIssues of bondsof every kind and4 2characterby counties, cities, and school corporations shall 4 3 be consecutively numbered. The annual levy of property tax 4 4 shall be sufficient to pay the interest and approximatelysuch4 5 that portion of the principal of the bonds as will retire them 4 6 in a period not exceeding twenty years from date of issue. 4 7 However, for school districts funding an issuance of bonds, in 4 8 whole or in part, with revenues from an income surtax, the 4 9 annual levy of property tax and income surtax imposed under 4 10 chapter 422E shall be sufficient to pay the interest and 4 11 approximately that portion of the principal of the bonds as 4 12 will retire them in a period not exceeding twenty years from 4 13 date of issue. Each issue of bonds shall be scheduled to 4 14 mature serially in the same order as numbered. 4 15 Sec. 7. Section 76.2, Code 1997, is amended to read as 4 16 follows: 4 17 76.2 MANDATORY LEVY – OBLIGATIONS IN ANTICIPATION OF 4 18 LEVY. 4 19 1. The governing authority of these political subdivisions 4 20 before issuing bonds shall, by resolution, provide for the 4 21 assessment of an annual levy upon all the taxable property in 4 22 the political subdivision, or the assessment of an annual levy 4 23 and imposition of a debt service income surtax under chapter 4 24 422E, sufficient to pay the interest and principal of the 4 25 bonds within a period named not exceedingtwenty yearsthat 4 26 provided in section 76.1. A certified copy of this resolution 4 27 shall be filed with the county auditor or the auditors of the 4 28 counties in which the political subdivision is located; and 4 29 the filingshall makemakes it a duty of the auditors to enter 4 30 annually this levy for collection from the taxable property 4 31 within the boundaries of the political subdivision until funds 4 32 are realized to pay the bonds in full. For school districts 4 33 funding the issuance of bonds, in whole or in part, with 4 34 revenues from a debt service income surtax, a copy of the 4 35 resolution also shall be filed with the department of revenue 5 1 and finance and the filing makes it a duty of the department 5 2 to impose the debt service income surtax within the boundaries 5 3 of the school district until funds are realized to pay the 5 4 bonds in full. The levy shall continue to be made against 5 5 property that is severed from the political subdivision after 5 6 the filing of the resolution until funds are realized to pay 5 7 the bonds in full. 5 8 If the ballot proposition approved by the electorate for 5 9 the issuance of bonds included imposition of a debt service 5 10 income surtax described in chapter 422E to partially fund the 5 11 bonds, the school district shall annually make an accounting 5 12 of the receipts, penalties, and interest received in 5 13 collection of the debt service income surtax in the preceding 5 14 calendar year and the amount of any balance remaining in that 5 15 debt service income surtax fund on December 31 of the 5 16 preceding year, and shall certify such amounts to the county 5 17 auditor when certifying the annual property tax levy. The 5 18 auditor shall apply such a rate on the taxable property within 5 19 the boundaries of the school district as will generate an 5 20 amount which together with the debt service income surtax 5 21 revenues and any debt service income surtax fund balance 5 22 certified by the school district is sufficient to pay the 5 23 interest and principal on the bonds. 5 24 2. If the resolution is filed prior to April 1 or May 1, 5 25 if the political subdivision is a school district, the annual 5 26 levy shall begin with the tax levy for collection commencing 5 27 July 1 of that year. If the resolution is filed after April 1 5 28 or May 1, in the case of a school district, the annual levy 5 29 shall begin with the tax levy for collection in the next 5 30 succeeding fiscal year. However, the governing authority of a 5 31 political subdivision may adjust a levy of taxes made under 5 32 this section for the purpose of adjusting the annual levies 5 33 and collections for property severed from the political 5 34 subdivision, subject to the approval of the director of the 5 35 department of management. 6 1 If the resolution includes the imposition of a debt service 6 2 income surtax and it is filed with the department of revenue 6 3 and finance prior to July 1, the imposition of the surtax is 6 4 retroactive to January 1 of that calendar year. If the 6 5 resolution is filed with the department of revenue and finance 6 6 after July 1, the imposition of the income surtax is January 1 6 7 of the next calendar year. 6 8 3. If funds, including reserves and amounts available for 6 9 temporary transfer, are found to be insufficient to pay in 6 10 full any installment of principal or interest, a public issuer 6 11 of bonds may anticipate the next levy of taxes pursuant to 6 12 this section in the manner provided in chapter 74, whether the 6 13 taxes so anticipated are to be collected in the same or a 6 14 future fiscal year. 6 15 Sec. 8. Section 76.3, Code 1997, is amended to read as 6 16 follows: 6 17 76.3 TAX LIMITATIONS. 6 18 Tax limitations inanya law or proposition for the 6 19 issuance of bonds or obligations, includinganya law or 6 20 proposition for the issuance of bonds or obligations in 6 21 anticipation of levies or collections of taxes or both, shall 6 22 be based on the latest equalized actual valuation then 6 23 existing and shall only restrict the amount of bonds or 6 24 obligations which may be issued. For the sole purpose of 6 25 computing the amount of bonds which may be issued as a result 6 26 of the application of a tax limitation, all interest on the 6 27 bonds or obligations in excess of that accruing in the first 6 28 twelve months may be excluded from the first annual levy of 6 29 taxes, so that the need for including more than one year's 6 30 interest in the first annual levy of taxes to pay the bonds or 6 31 obligations and interest does not operate to further restrict 6 32 the amount of bonds or obligations which may be issued, and in 6 33 certifying the annual levies to the county auditor or auditors 6 34 the first annual levy of taxes shall be sufficient to payall6 35 the principal of and interest on the bonds or obligations 7 1 becoming due prior to the next succeeding annual levy and the 7 2 full amount of the first annual levy shall be entered for 7 3 collection by the auditor or auditors, as provided in this 7 4 chapter. However, if a school district has approved the 7 5 imposition of a debt service income surtax pursuant to chapter 7 6 422E to pay all or a portion of the principal and interest on 7 7 the bonds or obligations, this section applies only for the 7 8 portion, if any, of principal and interest to be paid from the 7 9 annual levy of property taxes. 7 10 Sec. 9. Section 76.4, Code 1997, is amended to read as 7 11 follows: 7 12 76.4 PERMISSIVE APPLICATION OF FUNDS. 7 13WheneverIf the governing authority ofsucha political 7 14 subdivisionshall havehas on hand funds derived fromany7 15othera source other than taxation which may be appropriated 7 16 to the payment either ofinterest orprincipal or interest, or 7 17 both principal and interest of such bonds,suchthe funds may 7 18 be so appropriated and used and the property tax levy and 7 19 income surtax, if imposed, for the payment of the bonds 7 20 correspondingly reduced. 7 21 Sec. 10. Section 76.7, Code 1997, is amended to read as 7 22 follows: 7 23 76.7 PARTICULAR BONDS AFFECTED – PAYMENT. 7 24 Counties, cities, and school corporations may at any time 7 25or timesextend or renew any legal indebtedness or any part 7 26thereofof the indebtedness theymayhave represented by bonds 7 27 or certificates wheresuchthe indebtedness is payable from a 7 28 limited annual tax or from a voted annual tax or from a debt 7 29 service income surtax imposed under chapter 422E, and may by 7 30 resolution fund or refund thesamelegal indebtedness and 7 31 issue bondsthereforrunning not more than twenty years to be 7 32 known as funding or refunding bonds, and make provision for 7 33 the payment of the principal and interestthereoffrom the 7 34 proceeds of an annual tax or annual tax and debt service 7 35 income surtax for the period covered bysuchthe bonds similar 8 1 to the tax authorized by law or by the electors for the 8 2 payment of the indebtednesssoextended or renewed. 8 3 Sec. 11. Section 296.6, Code 1997, is amended to read as 8 4 follows: 8 5 296.6 BONDS. 8 6 If the vote in favor of the issuance of such bonds is equal 8 7 to at least sixty percent of the total vote cast for and 8 8 againstsaidthe proposition atsaidthe election, the board 8 9 of directors shall issue thesamebonds and make provision for 8 10 paymentthereofof the bonds. However, if the board of 8 11 directors of a school district elects to fund, in whole or in 8 12 part, the issuance of bonds with revenues from a debt service 8 13 income surtax, in addition to property tax revenues, the 8 14 ballot proposition to authorize the issuance of the bonds 8 15 shall be submitted to the electorate pursuant to section 75.1, 8 16 subsection 2. 8 17 Sec. 12. Section 298.14, unnumbered paragraph 1, Code 8 18 1997, is amended to read as follows: 8 19 For each fiscal year, the cumulative total of the percents 8 20 of surtax approved by the board of directors of a school 8 21 district and collected by the department of revenue and 8 22 finance under sections 257.21, 257.29, 279.54, and 298.2, and 8 23 the enrichment surtax under section 442.15, Code 1989, and an 8 24 income surtax collected by a political subdivision under 8 25chapterchapters 422D and 422E, shall not exceed twenty 8 26 percent. 8 27 Sec. 13. Section 298.14, unnumbered paragraph 2, Code 8 28 1997, is amended to read as follows: 8 29 A school district income surtax fund is created in the 8 30 office of treasurer of state. Income surtaxes collected by 8 31 the department of revenue and finance under sections 257.21, 8 32 257.29, 279.54, and 298.2 and section 442.15, Code 1989, shall 8 33 be deposited in the school district income surtax fund to the 8 34 credit of each school district. A separate accounting of each 8 35 surtax, by school district, shall be maintained. Income 9 1 surtaxes collected under chapter 422E shall be deposited in 9 2 the school bond financing fund created pursuant to section 9 3 422E.2. 9 4 Sec. 14. Section 298.18, unnumbered paragraph 2, Code 9 5 1997, is amended to read as follows: 9 6 The amount estimatedand certified to apply onto pay 9 7 principal and interest for any one year shall not exceed an 9 8 amount that could be raised by a property tax levy equal to 9 9 two dollars and seventy cents per thousand dollars of the 9 10 assessed valuation of the taxable property of the school 9 11 corporation except as hereinafter provided. 9 12 Sec. 15. Section 298.18, unnumbered paragraph 4, Code 9 13 1997, is amended to read as follows: 9 14 The amount estimatedand certified to apply onto pay 9 15 principal and interest for any one year may exceed an amount 9 16 that could be raised by a property tax levy equal to two 9 17 dollars and seventy cents per thousand dollars of assessed 9 18 value by the amount approved by the voters of the school 9 19 corporation, but not exceeding four dollars and five cents per 9 20 thousand of the assessed value of the taxable property within 9 21 any school corporation, provided that thequalifiedregistered 9 22 voters of such school corporation have first approved such 9 23 increased amount at a special election, which may be held at 9 24 the same time as the regular school election. The proposition 9 25 submitted to the voters at such special election shall be in 9 26 substantially the following form: 9 27 Sec. 16. Section 298.22, unnumbered paragraph 1, Code 9 28 1997, is amended to read as follows: 9 29All of saidThe bonds shall be substantially in the form 9 30 provided for county bonds, but subject to changes that will 9 31 conform them to the action of the boardproviding therefor;9 32 shallrun not more than twenty yearsmature within the period 9 33 provided in section 76.1, and may be sooner paid if so 9 34 nominated in the bond; bear a rate of interest not exceeding 9 35 that permitted by chapter 74A, payable semiannually; be signed 10 1 by the president and countersigned by the secretary of the 10 2 board of directors; and shall not be disposed of for less than 10 3 par value, nor issued for other purposes than this chapter 10 4 provides. 10 5 Sec. 17. APPLICABILITY. This Act applies to bond issuance 10 6 elections held on or after the effective date of this Act. 10 7 EXPLANATION 10 8 This bill authorizes bonds to be issued by a school 10 9 district which will be funded, in whole or in part, by a local 10 10 debt service income surtax, in addition to property taxes. 10 11 The question of whether to impose a local income surtax to 10 12 fund the issuance of bonds shall be included in the bond 10 13 issuance ballot proposition that is submitted to the voters of 10 14 the school district. A bond issuance proposition must receive 10 15 a 60 percent majority to be adopted. 10 16 The bill provides that the income surtax shall be imposed 10 17 on personal income tax filers and the rate of the tax, 10 18 together with the rates of other surtaxes, shall not exceed 20 10 19 percent. 10 20 The bill changes from 20 years to 22 years the length of 10 21 time that bonds can be outstanding. 10 22 The bill applies to bond issuance elections held on or 10 23 after July 1, 1998. 10 24 LSB 3632XC 77 10 25 sc/cf/24
Text: SSB02206 Text: SSB02208 Text: SSB02200 - SSB02299 Text: SSB Index Bills and Amendments: General Index Bill History: General Index
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