House File 2733 - Introduced
HOUSE FILE
BY FREVERT, WENDT, PETTENGILL,
BERRY, HUNTER, SWAIM, WHITAKER,
BUKTA, HEDDENS, D. OLSON,
GASKILL, KRESSIG, SHOULTZ,
KUHN, REASONER, SCHUELLER,
QUIRK, FREEMAN, KAUFMANN,
CHAMBERS, ANDERSON, HUTTER,
BAUDLER, GRANZOW, HEATON,
DOLECHECK, SCHICKEL, DRAKE,
STRUYK, ROBERTS, TJEPKES,
HOFFMAN, WILDERDYKE, and MADDOX
Passed House, Date Passed Senate, Date
Vote: Ayes Nays Vote: Ayes Nays
Approved
A BILL FOR
1 An Act relating to the increase in the state sales tax rate with
2 the revenues used for the replacement of the local option
3 sales and services tax for school infrastructure purposes.
4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
5 TLSB 6053YH 81
6 mg/je/5
PAG LIN
1 1 Section 1. Section 8.57, subsection 6, paragraph f, Code
1 2 Supplement 2005, is amended to read as follows:
1 3 f. There is appropriated from the rebuild Iowa
1 4 infrastructure fund to the secure an advanced vision for
1 5 education fund created in section 423E.4 423F.1, for each
1 6 fiscal year of the fiscal period beginning July 1, 2004 2006,
1 7 and ending June 30, 2014, the amount of the moneys in excess
1 8 of the first forty=seven million dollars credited to the
1 9 rebuild Iowa infrastructure fund during the fiscal year, not
1 10 to exceed ten million dollars.
1 11 Sec. 2. Section 423.2, subsection 1, unnumbered paragraph
1 12 1, Code Supplement 2005, is amended to read as follows:
1 13 There is imposed a tax of five six percent upon the sales
1 14 price of all sales of tangible personal property, consisting
1 15 of goods, wares, or merchandise, sold at retail in the state
1 16 to consumers or users except as otherwise provided in this
1 17 subchapter.
1 18 Sec. 3. Section 423.2, subsections 2, 3, 4, and 5, Code
1 19 Supplement 2005, are amended to read as follows:
1 20 2. A tax of five six percent is imposed upon the sales
1 21 price of the sale or furnishing of gas, electricity, water,
1 22 heat, pay television service, and communication service,
1 23 including the sales price from such sales by any municipal
1 24 corporation or joint water utility furnishing gas,
1 25 electricity, water, heat, pay television service, and
1 26 communication service to the public in its proprietary
1 27 capacity, except as otherwise provided in this subchapter,
1 28 when sold at retail in the state to consumers or users.
1 29 3. A tax of five six percent is imposed upon the sales
1 30 price of all sales of tickets or admissions to places of
1 31 amusement, fairs, and athletic events except those of
1 32 elementary and secondary educational institutions. A tax of
1 33 five six percent is imposed on the sales price of an entry fee
1 34 or like charge imposed solely for the privilege of
1 35 participating in an activity at a place of amusement, fair, or
2 1 athletic event unless the sales price of tickets or admissions
2 2 charges for observing the same activity are taxable under this
2 3 subchapter. A tax of five six percent is imposed upon that
2 4 part of private club membership fees or charges paid for the
2 5 privilege of participating in any athletic sports provided
2 6 club members.
2 7 4. A tax of five six percent is imposed upon the sales
2 8 price derived from the operation of all forms of amusement
2 9 devices and games of skill, games of chance, raffles, and
2 10 bingo games as defined in chapter 99B, operated or conducted
2 11 within the state, the tax to be collected from the operator in
2 12 the same manner as for the collection of taxes upon the sales
2 13 price of tickets or admission as provided in this section.
2 14 Nothing in this subsection shall legalize any games of skill
2 15 or chance or slot=operated devices which are now prohibited by
2 16 law.
2 17 The tax imposed under this subsection covers the total
2 18 amount from the operation of games of skill, games of chance,
2 19 raffles, and bingo games as defined in chapter 99B, and
2 20 musical devices, weighing machines, shooting galleries,
2 21 billiard and pool tables, bowling alleys, pinball machines,
2 22 slot=operated devices selling merchandise not subject to the
2 23 general sales taxes and on the total amount from devices or
2 24 systems where prizes are in any manner awarded to patrons and
2 25 upon the receipts from fees charged for participation in any
2 26 game or other form of amusement, and generally upon the sales
2 27 price from any source of amusement operated for profit, not
2 28 specified in this section, and upon the sales price from which
2 29 tax is not collected for tickets or admission, but tax shall
2 30 not be imposed upon any activity exempt from sales tax under
2 31 section 423.3, subsection 78. Every person receiving any
2 32 sales price from the sources described in this section is
2 33 subject to all provisions of this subchapter relating to
2 34 retail sales tax and other provisions of this chapter as
2 35 applicable.
3 1 5. There is imposed a tax of five six percent upon the
3 2 sales price from the furnishing of services as defined in
3 3 section 423.1.
3 4 Sec. 4. Section 423.2, subsection 7, paragraph a,
3 5 unnumbered paragraph 1, Code Supplement 2005, is amended to
3 6 read as follows:
3 7 A tax of five six percent is imposed upon the sales price
3 8 from the sales, furnishing, or service of solid waste
3 9 collection and disposal service.
3 10 Sec. 5. Section 423.2, subsections 8 and 9, Code
3 11 Supplement 2005, are amended to read as follows:
3 12 8. a. A tax of five six percent is imposed upon the sales
3 13 price from sales of bundled services contracts. For purposes
3 14 of this subsection, a "bundled services contract" means an
3 15 agreement providing for a retailer's performance of services,
3 16 one or more of which is a taxable service enumerated in this
3 17 section and one or more of which is not, in return for a
3 18 consumer's or user's single payment for the performance of the
3 19 services, with no separate statement to the consumer or user
3 20 of what portion of that payment is attributable to any one
3 21 service which is a part of the contract.
3 22 b. For purposes of the administration of the tax on
3 23 bundled services contracts, the director may enter into
3 24 agreements of limited duration with individual retailers,
3 25 groups of retailers, or organizations representing retailers
3 26 of bundled services contracts. Such an agreement shall impose
3 27 the tax rate only upon that portion of the sales price from a
3 28 bundled services contract which is attributable to taxable
3 29 services provided under the contract.
3 30 9. A tax of five six percent is imposed upon the sales
3 31 price from any mobile telecommunications service which this
3 32 state is allowed to tax by the provisions of the federal
3 33 Mobile Telecommunications Sourcing Act, Pub. L. No. 106=252,
3 34 4 U.S.C. } 116 et seq. For purposes of this subsection, taxes
3 35 on mobile telecommunications service, as defined under the
4 1 federal Mobile Telecommunications Sourcing Act that are deemed
4 2 to be provided by the customer's home service provider, shall
4 3 be paid to the taxing jurisdiction whose territorial limits
4 4 encompass the customer's place of primary use, regardless of
4 5 where the mobile telecommunications service originates,
4 6 terminates, or passes through and shall in all other respects
4 7 be taxed in conformity with the federal Mobile
4 8 Telecommunications Sourcing Act. All other provisions of the
4 9 federal Mobile Telecommunications Sourcing Act are adopted by
4 10 the state of Iowa and incorporated into this subsection by
4 11 reference. With respect to mobile telecommunications service
4 12 under the federal Mobile Telecommunications Sourcing Act, the
4 13 director shall, if requested, enter into agreements consistent
4 14 with the provisions of the federal Act.
4 15 Sec. 6. Section 423.2, subsection 11, Code Supplement
4 16 2005, is amended to read as follows:
4 17 11. All revenues arising under the operation of the
4 18 provisions of this section shall be deposited into the general
4 19 fund of the state as follows:
4 20 a. Five=sixths of such revenues shall be deposited into
4 21 the general fund of the state.
4 22 b. One=sixth of such revenues shall be deposited into the
4 23 secure an advanced vision for education fund created in
4 24 section 423F.1.
4 25 Sec. 7. Section 423E.1, subsection 2, Code 2005, is
4 26 amended to read as follows:
4 27 2. The maximum rate of tax shall be one percent. The tax
4 28 shall be imposed without regard to any other local sales and
4 29 services tax authorized in chapter 423B, and is repealed at
4 30 the expiration of a period of ten years of imposition or a
4 31 shorter period as provided in the ballot proposition unless
4 32 the period is extended as provided in section 423E.2,
4 33 subsection 5. However, all local option sales and services
4 34 taxes for school infrastructure purposes are repealed December
4 35 31, 2022.
5 1 Sec. 8. Section 423E.1, Code 2005, is amended by adding
5 2 the following new subsection:
5 3 NEW SUBSECTION. 4. a. After July 1, 2006, a county no
5 4 longer has the authority under this chapter to impose or to
5 5 extend an existing local sales and services tax for school
5 6 infrastructure purposes.
5 7 b. The increase in the state sales and services tax under
5 8 chapter 423, subchapter II, from five percent to six percent
5 9 shall replace the county's authorization to impose or extend a
5 10 local sales and services tax for school infrastructure
5 11 purposes and to this extent the local sales and services tax
5 12 for school infrastructure purposes is repealed. However, the
5 13 distribution of moneys in the secure an advanced vision for
5 14 education fund and the use of the moneys for infrastructure
5 15 purposes or property tax relief shall continue to apply as
5 16 provided in chapter 423F.
5 17 Sec. 9. Section 423E.2, subsection 5, paragraph c, Code
5 18 2005, is amended to read as follows:
5 19 c. A local option sales and services tax shall not be
5 20 repealed or reduced in rate if obligations are outstanding
5 21 which are payable as provided in section 423E.5, unless funds
5 22 sufficient to pay the principal, interest, and premium, if
5 23 any, on the outstanding obligations at and prior to maturity
5 24 have been properly set aside and pledged for that purpose.
5 25 However, this paragraph does not apply to the repeal of the
5 26 tax on December 31, 2022, as specified in section 423E.1,
5 27 subsection 2.
5 28 Sec. 10. Section 423E.4, subsection 1, Code Supplement
5 29 2005, is amended by striking the subsection.
5 30 Sec. 11. Section 423E.4, subsection 3, paragraph a, Code
5 31 Supplement 2005, is amended to read as follows:
5 32 a. The director of revenue by August 15 of each fiscal
5 33 year shall compute the guaranteed school infrastructure amount
5 34 for each school district, each school district's sales tax
5 35 capacity per student for each county, the statewide tax
6 1 revenues per student, and the supplemental school
6 2 infrastructure amount for the coming fiscal year.
6 3 Sec. 12. Section 423E.4, subsection 3, paragraph b,
6 4 subparagraph (3), Code Supplement 2005, is amended by striking
6 5 the subparagraph and inserting in lieu thereof the following:
6 6 (3) "Statewide tax revenues per student" means the amount
6 7 determined by estimating the total revenues that would be
6 8 generated by a one percent local option sales and services tax
6 9 for school infrastructure purposes if imposed by all the
6 10 counties during the entire fiscal year and dividing this
6 11 estimated revenue amount by the sum of the combined actual
6 12 enrollment for all counties as determined in section 423E.3,
6 13 subsection 5, paragraph "d", subparagraph (2).
6 14 Sec. 13. Section 423E.5, Code Supplement 2005, is amended
6 15 to read as follows:
6 16 423E.5 BONDING.
6 17 The board of directors of a school district shall be
6 18 authorized to issue negotiable, interest=bearing school bonds,
6 19 without election, and utilize tax receipts derived from the
6 20 sales and services tax for school infrastructure purposes and
6 21 the supplemental school infrastructure amount distributed
6 22 pursuant to section 423E.4, subsection 2, paragraph "b", and
6 23 revenues received pursuant to section 423F.1, for principal
6 24 and interest repayment. Proceeds of the bonds issued pursuant
6 25 to this section shall be utilized solely for school
6 26 infrastructure needs as school infrastructure is defined in
6 27 section 423E.1, subsection 3 and section 423F.2. Bonds issued
6 28 under this section may be sold at public sale as provided in
6 29 chapter 75, or at private sale, without notice and hearing as
6 30 provided in section 73A.12. Bonds may bear dates, bear
6 31 interest at rates not exceeding that permitted by chapter 74A,
6 32 mature in one or more installments, be in registered form,
6 33 carry registration and conversion privileges, be payable as to
6 34 principal and interest at times and places, be subject to
6 35 terms of redemption prior to maturity with or without premium,
7 1 and be in one or more denominations, all as provided by the
7 2 resolution of the board of directors authorizing their
7 3 issuance. The resolution may also prescribe additional
7 4 provisions, terms, conditions, and covenants which the board
7 5 of directors deems advisable, including provisions for
7 6 creating and maintaining reserve funds, the issuance of
7 7 additional bonds ranking on a parity with such bonds and
7 8 additional bonds junior and subordinate to such bonds, and
7 9 that such bonds shall rank on a parity with or be junior and
7 10 subordinate to any bonds which may be then outstanding. Bonds
7 11 may be issued to refund outstanding and previously issued
7 12 bonds under this section. Local option sales and services tax
7 13 revenue The bonds are a contract between contractual
7 14 obligation of the school district and holders, and the
7 15 resolution issuing the bonds and pledging local option sales
7 16 and services tax revenues or its share of the revenues
7 17 distributed pursuant to section 423F.1 to the payment of
7 18 principal and interest on the bonds is a part of the contract.
7 19 Bonds issued pursuant to this section shall not constitute
7 20 indebtedness within the meaning of any constitutional or
7 21 statutory debt limitation or restriction, and shall not be
7 22 subject to any other law relating to the authorization,
7 23 issuance, or sale of bonds.
7 24 A school district in which a local option sales tax for
7 25 school infrastructure purposes has been imposed shall be
7 26 authorized to enter into a chapter 28E agreement with one or
7 27 more cities or a county whose boundaries encompass all or a
7 28 part of the area of the school district. A city or cities
7 29 entering into a chapter 28E agreement shall be authorized to
7 30 expend its designated portion of the local option sales and
7 31 services tax revenues for any valid purpose permitted in this
7 32 chapter or authorized by the governing body of the city. A
7 33 county entering into a chapter 28E agreement with a school
7 34 district in which a local option sales tax for school
7 35 infrastructure purposes has been imposed shall be authorized
8 1 to expend its designated portion of the local option sales and
8 2 services tax revenues to provide property tax relief within
8 3 the boundaries of the school district located in the county.
8 4 A school district where a local option sales and services tax
8 5 is imposed is also authorized to enter into a chapter 28E
8 6 agreement with another school district, a community college,
8 7 or an area education agency which is located partially or
8 8 entirely in or is contiguous to the county where the tax is
8 9 imposed school district is located. The school district or
8 10 community college shall only expend its designated portion of
8 11 the local option sales and services tax revenues for
8 12 infrastructure purposes. The area education agency shall only
8 13 expend its designated portion of the local option school
8 14 infrastructure sales tax revenues for infrastructure and
8 15 maintenance purposes.
8 16 The governing body of a city may authorize the issuance of
8 17 bonds which are payable from its designated portion of the
8 18 revenues of the local option sales and services tax to be
8 19 received under this section, and not from property tax, by
8 20 following the authorization procedures set forth for cities in
8 21 section 384.83. A city may pledge irrevocably any amount
8 22 derived from its designated portions of the revenues of the
8 23 local option sales and services tax to the support or payment
8 24 of such bonds.
8 25 Sec. 14. NEW SECTION. 423F.1 SECURE AN ADVANCED VISION
8 26 FOR EDUCATION FUND.
8 27 1. A secure an advanced vision for education fund is
8 28 created as a separate and distinct fund in the state treasury
8 29 under the control of the department of revenue. Moneys in the
8 30 fund include revenues credited to the fund pursuant to this
8 31 chapter, appropriations made to the fund, and other moneys
8 32 deposited into the fund. Any amounts disbursed from the fund
8 33 shall be utilized for school infrastructure purposes or
8 34 property tax relief.
8 35 2. The moneys available in a fiscal year in the secure an
9 1 advanced vision for education fund shall be distributed by the
9 2 department of revenue to each school district in an amount
9 3 equal to the amount the school district would have received
9 4 pursuant to the formula in section 423E.4 as if the local
9 5 sales and services tax for school infrastructure purposes was
9 6 imposed.
9 7 3. a. The director of revenue by August 15 of each fiscal
9 8 year shall send to each school district an estimate of the
9 9 amount of tax moneys each school district will receive for the
9 10 year and for each month of the year. At the end of each
9 11 month, the director may revise the estimates for the year and
9 12 remaining months.
9 13 b. The director shall remit ninety=five percent of the
9 14 estimated tax receipts for the school district to the school
9 15 district on or before August 31 of the fiscal year and on or
9 16 before the last day of each following month.
9 17 c. The director shall remit a final payment of the
9 18 remainder of tax moneys due for the fiscal year before
9 19 November 10 of the next fiscal year. If an overpayment has
9 20 resulted during the previous fiscal year, the November payment
9 21 shall be adjusted to reflect any overpayment.
9 22 Sec. 15. NEW SECTION. 423F.2 USE OF REVENUES.
9 23 1. A school district receiving revenues from the secure an
9 24 advanced vision for education fund under this chapter shall
9 25 expend the revenues subject to this section for the following
9 26 purposes:
9 27 a. Reduction of bond levies under sections 298.18 and
9 28 298.18A and all other debt levies.
9 29 b. Reduction of the regular and voter=approved physical
9 30 plant and equipment levy under section 298.2.
9 31 c. Reduction of the public educational and recreational
9 32 levy under section 300.2.
9 33 d. Reduction of the schoolhouse tax levy under section
9 34 278.1, subsection 7, Code 1989.
9 35 e. For any authorized infrastructure purpose of the school
10 1 district as defined in section 423E.1.
10 2 f. For the payment of principal and interest on bonds
10 3 issued under sections 423E.5 and section 423F3.
10 4 2. Upon the expiration of a revenue purpose statement in
10 5 existence for the expenditure of local sales and services tax
10 6 for school infrastructure purposes imposed by a county
10 7 pursuant to chapter 423E prior to July 1, 2006, the board of
10 8 directors of a school district may take action to adopt a
10 9 revenue purpose statement specifying the specific purposes for
10 10 which the revenues received from the secure an advanced vision
10 11 for education fund will be expended. If a school district is
10 12 located in a county which has imposed a local sales and
10 13 services tax for school infrastructure purposes on July 1,
10 14 2006, this action shall be taken before expending or
10 15 anticipating revenues to be received after the unextended term
10 16 of the tax. Approval by the electors of an extended tax shall
10 17 constitute approval under this section.
10 18 3. The governing body shall institute proceedings to
10 19 approve a revenue purpose statement by causing a notice of the
10 20 meeting to discuss approval of a revenue purpose statement to
10 21 be published at least once in a newspaper of general
10 22 circulation within the school district at least ten days prior
10 23 to the meeting. Within thirty days following the meeting, the
10 24 board of directors shall take action to approve a revenue
10 25 purpose statement. If at any time before the end of the
10 26 thirty=day period after the meeting approving a revenue
10 27 purpose statement a petition is filed with the secretary of
10 28 the board asking that the question of approving the revenue
10 29 purpose statement be submitted to the registered voters of the
10 30 school district, the board shall either by resolution repeal
10 31 the action approving a revenue purpose statement or direct the
10 32 county commissioner of elections to call a special election
10 33 upon the question of approving the revenue purpose statement.
10 34 The petition must be signed by eligible electors equal to not
10 35 less than one hundred or thirty percent of the number of
11 1 voters at the last preceding regular school election. A
11 2 majority of those voting on the question must favor approval
11 3 of the revenue purpose statement.
11 4 4. The revenues received pursuant to this chapter shall be
11 5 expended for the purposes specified in the revenue purpose
11 6 statement. In the event that a board of directors has not
11 7 approved a revenue purpose statement, the revenues shall be
11 8 expended in the order listed in subsection 1. Once approved,
11 9 a revenue purpose statement is effective until amended or
11 10 repealed by the foregoing procedures. A revenue purpose
11 11 statement shall not be amended or repealed to reduce the
11 12 amount of revenue pledged to the payment of principal and
11 13 interest on bonds as long as any bonds authorized by sections
11 14 423E.5 and 423F.3 are outstanding unless funds sufficient to
11 15 pay principal, interest, and premium, if any, on the
11 16 outstanding obligations at or prior to maturity have been
11 17 properly set aside and pledged for that purpose.
11 18 5. A school district with a certified enrollment of fewer
11 19 than two hundred fifty pupils in the entire district or
11 20 certified enrollment of fewer than one hundred pupils in high
11 21 school shall not expend the amount received for new
11 22 construction without prior application to the department of
11 23 education and receipt of a certificate of need pursuant to
11 24 this subsection. A certificate of need is not required for
11 25 repairing schoolhouses or buildings, equipment, technology, or
11 26 transportation equipment for transporting students as provided
11 27 in section 298.3, or for construction necessary for compliance
11 28 with the federal Americans With Disabilities Act pursuant to
11 29 42 U.S.C. } 12101==12117. In determining whether a
11 30 certificate of need shall be issued or denied, the department
11 31 shall consider all of the following:
11 32 a. Enrollment trends in the grades that will be served at
11 33 the new construction site.
11 34 b. The infeasibility of remodeling, reconstructing, or
11 35 repairing existing buildings.
12 1 c. The fire and health safety needs of the school
12 2 district.
12 3 d. The distance, convenience, cost of transportation, and
12 4 accessibility of the new construction site to the students to
12 5 be served at the new construction site.
12 6 e. Availability of alternative, less costly, or more
12 7 effective means of serving the needs of the students.
12 8 f. The financial condition of the district, including the
12 9 effect of the decline of the budget guarantee and unspent
12 10 balance.
12 11 g. Broad and long=term ability of the district to support
12 12 the facility and the quality of the academic program.
12 13 h. Cooperation with other educational entities including
12 14 other school districts, area education agencies, postsecondary
12 15 institutions, and local communities.
12 16 Sec. 16. NEW SECTION. 423F.3 BORROWING AUTHORITY FOR
12 17 SCHOOL DISTRICTS.
12 18 A school district may anticipate its share of the revenues
12 19 under section 423F.1 by issuing bonds in the manner provided
12 20 in section 423E.5. However, to the extent any school district
12 21 has issued bonds anticipating the proceeds of an extended
12 22 local sales and services tax for school infrastructure
12 23 purposes imposed by a county pursuant to chapter 423E prior to
12 24 July 1, 2006, the pledge of such revenues for the payment of
12 25 principal and interest on such bonds shall be replaced by a
12 26 pledge of its share of the revenues under section 423F.1.
12 27 Sec. 17. CONSTRUCTION CONTRACTORS.
12 28 1. Construction contractors may make application to the
12 29 department of revenue for a refund of the additional one
12 30 percent tax paid under chapter 423, subchapter II, by reason
12 31 of the increase in the sales tax from five to six percent for
12 32 taxes paid on goods, wares, or merchandise under the following
12 33 conditions:
12 34 a. The goods, wares, or merchandise are incorporated into
12 35 an improvement to real estate in fulfillment of a written
13 1 contract fully executed prior to July 1, 2006. The refund
13 2 shall not apply to equipment transferred in fulfillment of a
13 3 mixed construction contract.
13 4 b. The contractor has paid to the department of revenue or
13 5 to a retailer the full six percent tax.
13 6 c. The claim is filed on forms provided by the department
13 7 of revenue and is filed within one year of the date the tax is
13 8 paid.
13 9 2. A contractor who makes an erroneous application for
13 10 refund shall be liable for payment of the excess refund paid
13 11 plus interest at the rate in effect under section 421.7. In
13 12 addition, a contractor who willfully makes a false application
13 13 for refund is guilty of a simple misdemeanor and is liable for
13 14 a penalty equal to fifty percent of the excess refund claimed.
13 15 Excess refunds, penalties, and interest due under this section
13 16 may be enforced and collected in the same manner as the tax
13 17 imposed by chapter 423.
13 18 Sec. 18. APPLICABILITY. This section applies in regard to
13 19 the increase in the state sales tax from five to six percent.
13 20 The six percent rate applies to all sales of taxable personal
13 21 property, consisting of goods, wares, or merchandise if
13 22 delivery occurs on or after July 1, 2006. The six percent
13 23 rate applies to the gross receipts from the sale, furnishing,
13 24 or service of gas, electricity, water, heat, pay television
13 25 service, and communication service if the date of billing the
13 26 customer is on or after July 1, 2006. In the case of a
13 27 service contract entered into prior to July 1, 2006, which
13 28 contract calls for periodic payments, the six percent rate
13 29 applies to those payments made or due on or after July 1,
13 30 2006. This periodic payment applies but is not limited to
13 31 tickets or admissions, private club membership fees, sources
13 32 of amusement, equipment rental, dry cleaning, reducing salons,
13 33 dance schools, and all other services subject to tax, except
13 34 the aforementioned utility services which are subject to a
13 35 special transitional rule. Unlike periodic payments under
14 1 service contracts, installment sales of goods, wares, and
14 2 merchandise are subject to the full amount of sales tax when
14 3 the sales contract is entered into.
14 4 EXPLANATION
14 5 This bill increases the state sales tax from 5 percent to 6
14 6 percent. The increased revenues are deposited into a new
14 7 secure an advanced vision for education fund to be distributed
14 8 to all school districts. Those revenues are to replace the
14 9 local option sales and services tax for school infrastructure
14 10 purposes. A statewide amount per pupil is computed each
14 11 fiscal year based upon the estimated amount that would be
14 12 generated by a 1 percent local sales and services tax, if one
14 13 was imposed, divided by combined enrollment of all school
14 14 districts. Each district will receive an amount equal to the
14 15 amount that it would have received under the formula if the
14 16 local sales and services tax for school infrastructure was
14 17 imposed.
14 18 Revenues received are to be used according to a revenue
14 19 purpose statement that was in existence under the replaced
14 20 tax. Prior to use of any revenues after the replaced tax
14 21 expires, the school district may hold a public meeting on the
14 22 adoption of a revenue purpose statement. If a valid petition
14 23 to hold an election is submitted, then the school district
14 24 either withdraws the revenue purpose statement or an election
14 25 is held. A valid petition has signatures equal to 100
14 26 eligible voters or 30 percent of the number of voters at the
14 27 last regular school election.
14 28 The purposes for which the revenues may be used are the
14 29 reduction of bond levies, regular and voter approved physical
14 30 plant and equipment levy, public educational and recreational
14 31 levy, and schoolhouse tax levy, authorized infrastructure
14 32 purposes as defined in Code section 423E.1, and payment of
14 33 principal and interest of bonds issued under Code chapters
14 34 423E or 423F. If a revenue purpose statement is not approved,
14 35 the revenues are to be used in the order listed for the above
15 1 purposes.
15 2 LSB 6053YH 81
15 3 mg:rj/je/5.2