Senate File 2226
SENATE FILE
BY LUNDBY
Passed Senate, Date Passed House, Date
Vote: Ayes Nays Vote: Ayes Nays
Approved
A BILL FOR
1 An Act relating to the imposition of a community college income
2 surtax.
3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
4 TLSB 5495XS 80
5 rn/sh/8
PAG LIN
1 1 Section 1. Section 260C.18, Code 2003, is amended by
1 2 adding the following new subsection:
1 3 NEW SUBSECTION. 8. Revenue derived from imposition of the
1 4 income surtax authorized pursuant to section 260C.26.
1 5 Sec. 2. NEW SECTION. 260C.26 INCOME SURTAX.
1 6 1. An income surtax that provides funding for community
1 7 colleges in addition to the taxes authorized pursuant to
1 8 sections 260C.17, 260C.22, and 260C.28 is established.
1 9 2. Beginning with tax years beginning in the 2004 calendar
1 10 year, the department of revenue shall impose the income surtax
1 11 on a statewide basis as provided in this section. The rate of
1 12 income surtax shall be one percent for tax years beginning in
1 13 the 2004 calendar year, and two percent for tax years
1 14 beginning in calendar year 2005 and succeeding calendar years.
1 15 Revenue from the income surtax may be used for any purpose
1 16 relating to general fund programs and activities provided by
1 17 community colleges.
1 18 3. The income surtax shall be imposed on the state
1 19 individual income tax computed under section 422.5, less the
1 20 credits allowed in sections 422.11A, 422.11B, 422.12, and
1 21 422.12B, and shall be imposed on all individuals residing in
1 22 the state on the last day of the applicable tax year. The
1 23 income surtax shall be made a part of the Iowa individual
1 24 income tax return subject to the conditions and restrictions
1 25 set forth in section 422.21. The director of revenue shall
1 26 collect and account for the income surtax and any interest and
1 27 penalties and shall credit income surtax receipts and any
1 28 interest and penalties collected from returns filed on or
1 29 before November 1 of the calendar year following the tax year
1 30 for which the income surtax is imposed to a community college
1 31 income surtax fund created in the office of treasurer of
1 32 state. All income surtax receipts and any interest and
1 33 penalties received or refunded from returns filed after
1 34 November 1 of the calendar year following the tax year for
1 35 which the income surtax is imposed shall be deposited in or
2 1 withdrawn from the general fund of the state and shall be
2 2 considered part of the cost of administering the income
2 3 surtax.
2 4 4. Amounts credited to the community college income surtax
2 5 fund shall be distributed annually to each merged area. The
2 6 director of revenue shall draw warrants in payment of the
2 7 surtaxes collected. Warrants shall be payable in two
2 8 installments to be paid on approximately the first day of
2 9 December and the first day of February following collection of
2 10 the taxes and shall be delivered to the respective merged
2 11 areas. The amount payable to each merged area shall be
2 12 distributed on the basis of each merged area's community
2 13 college full=time equivalent enrollment. The department of
2 14 education shall determine full=time equivalent enrollment
2 15 share percentages for each community college district using
2 16 data from the most recently concluded fiscal year for purposes
2 17 of allocating income surtax receipts.
2 18 Sec. 3. Section 298.14, unnumbered paragraph 1, Code
2 19 Supplement 2003, is amended to read as follows:
2 20 For each fiscal year, the cumulative total of the percents
2 21 of surtax approved by the board of directors of a school
2 22 district and collected by the department of revenue under
2 23 sections 257.21, 257.29, and 298.2, and the enrichment surtax
2 24 under section 442.15, Code 1989, and an income surtax
2 25 collected by a political subdivision under chapter 422D, and
2 26 the income surtax collected pursuant to section 260C.26, shall
2 27 not exceed twenty percent.
2 28 EXPLANATION
2 29 This bill provides for the imposition of a community
2 30 college income surtax.
2 31 The bill provides that the income surtax shall be imposed
2 32 at a rate of 1 percent for tax years beginning in calendar
2 33 year 2004, and 2 percent for tax years beginning in calendar
2 34 year 2005, and succeeding calendar years. The bill provides
2 35 that revenue derived from the income surtax may be used for
3 1 any purpose relating to community college general fund
3 2 programs and activities.
3 3 The bill provides that the income surtax shall be imposed
3 4 on the state individual income tax computed under Code section
3 5 422.5, less specified credits; shall be imposed on all
3 6 individuals residing in the state on the last day of the
3 7 applicable tax year; and shall be made a part of the Iowa
3 8 individual income tax return subject to the conditions and
3 9 restrictions set forth in Code section 422.21.
3 10 The bill provides that the director of revenue shall credit
3 11 income surtax receipts, interest, and penalties to a community
3 12 college income surtax fund created in the office of the
3 13 treasurer of state. The bill provides that amounts credited
3 14 to the community college income surtax fund shall be
3 15 distributed annually to each merged area on the basis of each
3 16 merged area's community college full=time equivalent
3 17 enrollment. The bill provides that the department of
3 18 education shall determine full=time equivalent enrollment
3 19 share percentages for each community college district using
3 20 data from the most recently concluded fiscal year for purposes
3 21 of allocating income surtax receipts.
3 22 The bill provides corresponding changes to Code section
3 23 298.14 regarding inclusion of the community college income
3 24 surtax in the provision that the cumulative total of percents
3 25 of surtax collected shall not exceed 20 percent.
3 26 LSB 5495XS 80
3 27 rn/sh/8