House File 2237 - Introduced HOUSE FILE 2237 BY LUKAN A BILL FOR An Act relating to the rebate of state sales tax to the owner or 1 operator of a baseball and softball tournament facility and 2 movie site. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 5471YH (7) 84 mm/sc
H.F. 2237 Section 1. FINDINGS. The general assembly finds that a 1 baseball and softball tournament facility and movie site in 2 Iowa would result in a substantial economic benefit to the 3 state and would offer thousands of competitors and visitors the 4 opportunity to experience and discover Iowa. 5 The general assembly further finds that the development 6 of the baseball and softball tournament facility and movie 7 site, including a year-round training facility, would enhance 8 the economic development of the area through an increase in 9 tourism. 10 The general assembly further finds that the rebate of state 11 sales tax collected at the baseball and softball tournament 12 facility and movie site to assist in the development of such 13 facility and complex would further tourism and is a public 14 purpose for which state funds may be used. 15 The general assembly further finds that the rebate of state 16 sales tax to the baseball and softball tournament facility and 17 movie site should be considered a program to be used as a means 18 to increase tourism into the state. 19 Sec. 2. Section 423.4, Code Supplement 2011, is amended by 20 adding the following new subsection: 21 NEW SUBSECTION . 10. a. For purposes of this subsection: 22 (1) “Baseball and softball tournament facility and movie 23 site” means a baseball and softball tournament complex and 24 tourist destination, which facility is located on a maximum of 25 two hundred seventy-nine acres, located inside or within three 26 miles of the city limits of a city with a population of at least 27 four thousand but not more than five thousand five hundred 28 residents, which city is located in a county with a population 29 of at least ninety-three thousand but not more than one hundred 30 thousand residents and where the construction on the baseball 31 and softball tournament facility commenced not later than one 32 year following the enactment of this Act, and the cost of the 33 construction upon completion was at least thirty-eight million 34 dollars. 35 -1- LSB 5471YH (7) 84 mm/sc 1/ 6
H.F. 2237 (2) “Change of control” means any of the following: 1 (a) Any change in the ownership of the original or any 2 subsequent legal entity that is the owner or operator of the 3 baseball and softball tournament facility and movie site such 4 that more than fifty percent of the equity interests in the 5 legal entity cease to be owned by individuals who are residents 6 of Iowa, an Iowa corporation, or combination of both. 7 (b) The original owners of the legal entity that is the 8 owner or operator of the baseball and softball tournament 9 facility and movie site shall collectively cease to own more 10 than fifty percent of the voting equity interests of such legal 11 entity or shall otherwise cease to have effective control of 12 such legal entity. 13 (3) “Iowa corporation” means a corporation incorporated 14 under the laws of Iowa where at least fifty percent of the 15 corporation’s equity interests are owned by individuals who are 16 residents of Iowa. 17 (4) “Owner or operator” means a for-profit legal entity 18 where at least fifty percent of its equity interests are owned 19 by individuals who are residents of Iowa, an Iowa corporation, 20 or combination of both and that is the owner or operator of a 21 baseball and softball tournament facility and movie site and is 22 primarily a promoter of baseball and softball tournaments. 23 (5) “Population” means the population based upon the 2010 24 certified federal census. 25 b. The owner or operator of a baseball and softball 26 tournament facility and movie site may apply to the department 27 for a rebate of sales tax imposed and collected by retailers 28 upon sales of any goods, wares, merchandise, admission tickets, 29 or services furnished to purchasers at the baseball and 30 softball tournament facility and movie site. 31 c. The rebate may be obtained only in the following amounts 32 and manner and only under the following conditions: 33 (1) On forms furnished by the department within the time 34 period provided by the department by rule, which time period 35 -2- LSB 5471YH (7) 84 mm/sc 2/ 6
H.F. 2237 shall not be longer than quarterly. 1 (2) The owner or operator shall provide information as 2 deemed necessary by the department. 3 (3) The transactions for which sales tax was collected and 4 the rebate is sought occurred on or after January 1, 2014, 5 but before January 1, 2024. However, not more than sixteen 6 million five hundred thousand dollars in total rebates shall be 7 provided pursuant to this subsection. 8 (4) Notwithstanding subparagraph (3), the rebate of sales 9 tax shall cease for transactions occurring on or after the 10 date of the change of control of the baseball and softball 11 tournament facility and movie site. 12 d. To assist the department in determining the amount 13 of the rebate, the owner or operator shall identify to the 14 department retailers located at the baseball and softball 15 tournament facility and movie site who will be collecting sales 16 tax. The department shall verify such identity and ensure 17 that all proper permits have been issued. For purposes of 18 this subsection, advance ticket and admissions sales shall be 19 considered occurring at the baseball and softball tournament 20 facility and movie site regardless of where the transactions 21 actually occur. 22 e. There is established within the state treasury under the 23 control of the department a baseball and softball tournament 24 facility and movie site sales tax rebate fund consisting of 25 the amount of state sales tax revenues transferred pursuant 26 to section 423.2, subsection 11, paragraph “b” , subparagraph 27 (4). An account is created within the fund for each baseball 28 and softball tournament facility and movie site meeting the 29 qualifications of this subsection. Moneys in the fund shall 30 only be used to provide rebates of state sales tax pursuant 31 to this subsection, and only the state sales tax revenues in 32 the baseball and softball tournament facility and movie site 33 rebate fund are subject to rebate under this subsection. Not 34 more than sixteen million five hundred thousand dollars in 35 -3- LSB 5471YH (7) 84 mm/sc 3/ 6
H.F. 2237 total rebates shall be paid from the fund. Any moneys in the 1 fund which represent state sales tax revenue for which the time 2 period in paragraph “c” for receiving a rebate has expired, 3 or which otherwise represent state sales tax revenue that has 4 become ineligible for rebate pursuant to this subsection, shall 5 immediately revert to the general fund of this state. 6 f. Upon determining that the conditions and requirements 7 of this subsection and the department are met, the department 8 shall issue a warrant from the applicable account within the 9 baseball and softball tournament facility and movie site rebate 10 fund to the owner or operator in the amount equal to the amount 11 claimed and verified by the department. 12 g. This subsection is repealed June 30, 2024, or thirty 13 days following the date on which sixteen million five hundred 14 thousand dollars in total rebates have been provided, or thirty 15 days following the date on which rebates cease as provided in 16 paragraph “c” , subparagraph (4), whichever is the earliest. 17 Sec. 3. Section 423.2, subsection 11, Code Supplement 2011, 18 is amended to read as follows: 19 11. a. (1) All revenues arising under the operation of the 20 provisions of this section shall be deposited into the general 21 fund of the state. 22 (2) Subsequent to the deposit into the general fund of 23 the state, the director shall credit an amount equal to the 24 product of the sales tax rate imposed in this section times 25 the sales price of the tangible personal property or services 26 furnished to purchasers at a baseball and softball tournament 27 facility and movie site meeting the qualifications of section 28 423.4, subsection 10, into the baseball and softball tournament 29 facility and movie site sales tax rebate fund created under 30 section 423.4, subsection 10, paragraph “e” . The director 31 shall credit the moneys beginning the first day of the quarter 32 following the effective date of this Act. This subparagraph is 33 repealed June 30, 2024, or thirty days following the date on 34 which sixteen million five hundred thousand dollars in total 35 -4- LSB 5471YH (7) 84 mm/sc 4/ 6
H.F. 2237 rebates have been provided under section 423.4, subsection 1 10, or thirty days following the date on which rebates cease 2 as provided in section 423.4, subsection 10, paragraph “c” , 3 subparagraph (4), whichever is earliest. 4 b. Subsequent to the deposit into the general fund of the 5 state and after the transfer of such pursuant to paragraph “a” , 6 the department shall do the following in the order prescribed: 7 (1) Transfer the revenues collected under chapter 423B , the 8 department shall transfer . 9 (2) Transfer from the remaining revenues the amounts 10 required under Article VII, section 10, of the Constitution 11 of the State of Iowa to the natural resources and outdoor 12 recreation trust fund created in section 461.31, if applicable. 13 (3) Transfer one-sixth of such the remaining revenues to the 14 secure an advanced vision for education fund created in section 15 423F.2 . This paragraph subparagraph (3) is repealed December 16 31, 2029. 17 (4) Transfer to the baseball and softball tournament 18 facility and movie site sales tax rebate fund that portion of 19 the sales tax receipts described in paragraph “a” , subparagraph 20 (2), remaining after the transfers required under subparagraphs 21 (1), (2), and (3) of this paragraph “b” . This subparagraph is 22 repealed June 30, 2024, or thirty days following the date on 23 which sixteen million five hundred thousand dollars in total 24 rebates have been provided under section 423.4, subsection 25 10, or thirty days following the date on which rebates cease 26 as provided in section 423.4, subsection 10, paragraph “c ”, 27 subparagraph (4), whichever is earliest. 28 EXPLANATION 29 This bill authorizes the department of revenue to rebate 30 sales tax collected by retailers on purchases made at a 31 baseball and softball tournament facility and movie site. To 32 be eligible for the rebate the baseball and softball tournament 33 facility and movie site must be located on a maximum of 279 34 acres and located inside or within three miles of the city 35 -5- LSB 5471YH (7) 84 mm/sc 5/ 6
H.F. 2237 limits of a city with a population between 4,000 and 5,500, 1 which is located in a county with a population between 93,000 2 and 100,000. In addition, construction on the facility must 3 commence not later than one year following the enactment of the 4 bill, and the cost of the construction must be at least $38 5 million. 6 The person eligible to receive the rebate is the owner or 7 operator of the baseball and softball tournament facility and 8 movie site. The rebate of sales tax only applies to the sales 9 tax collected on transactions occurring on or after January 1, 10 2014, and before January 1, 2024, and shall only be paid from 11 the baseball and softball tournament facility and movie site 12 sales tax rebate fund created in the bill. 13 The bill creates the baseball and softball tournament 14 facility and movie site sales tax rebate fund consisting of 15 the remaining amount of state sales tax revenue collected upon 16 tangible personal property or services furnished to purchasers 17 at the baseball and softball tournament facility and movie 18 site after subtracting the local option sales tax under Code 19 chapter 423B, the natural resources and outdoor recreation 20 trust fund transfer pursuant to Article VII, section 10, of the 21 Constitution of the State of Iowa if applicable, and the secure 22 an advanced vision for education fund transfer pursuant to Code 23 section 423F.2. Rebates are paid only from this rebate fund 24 and are limited to the amounts in the fund. The total amount 25 that may be rebated from the fund and under the bill is $16.5 26 million. 27 The rebate ceases if control of the facility changes. The 28 rebate provision is repealed June 30, 2024, or 30 days after 29 a total of $16.5 million has been rebated, whichever occurs 30 earlier. 31 -6- LSB 5471YH (7) 84 mm/sc 6/ 6