Senate File 2325 - Reprinted SENATE FILE 2325 BY COMMITTEE ON WAYS AND MEANS (SUCCESSOR TO SSB 3168) (As Amended and Passed by the Senate April 28, 2016 ) A BILL FOR An Act providing a sales tax refund for the sale of goods and 1 services furnished in fulfillment of a written construction 2 contract with a qualifying nonprofit hospital, and providing 3 penalties. 4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 5 SF 2325 (3) 86 mm/sc/jh
S.F. 2325 Section 1. Section 423.4, Code 2016, is amended by adding 1 the following new subsection: 2 NEW SUBSECTION . 12. a. For purposes of this subsection, 3 “designated nonprofit hospital” means a nonprofit hospital 4 licensed pursuant to chapter 135B that satisfies all of the 5 following requirements: 6 (1) The hospital entered into a written construction 7 contract on or after January 1, 2014, but prior to December 31, 8 2016, or the hospital issued bonds to fund construction on or 9 after July 1, 2014, but prior to December 31, 2016. 10 (2) The hospital is located in a county that borders 11 Illinois and has a population of at least one hundred fifty 12 thousand according to the 2010 certified federal census. 13 (3) Between July 1, 2014, and December 31, 2018, the 14 hospital, including any affiliated system hospital located 15 in the same county, expends more than two million dollars on 16 capital expenditures for facilities to provide inpatient or 17 outpatient behavioral health services, as determined by the 18 department from the Medicare cost reports prepared by the 19 hospital. 20 b. Beginning July 1, 2017, a designated nonprofit hospital 21 in this state may make application to the department for the 22 refund of the sales or use tax upon the sales price of all sales 23 of goods, wares, or merchandise, or from services furnished to 24 a contractor, used in the fulfillment of a written construction 25 contract with the designated nonprofit hospital entered into on 26 or after January 1, 2014, but prior to December 31, 2016. In 27 order to qualify for the refund, the sale and delivery of the 28 goods, wares, or merchandise, or the services furnished, must 29 have occurred between January 1, 2014, and December 31, 2017, 30 and must have been purchased directly by a contractor, or by a 31 contractor as the agent for the designated nonprofit hospital, 32 or directly by the designated nonprofit hospital. 33 c. Such contractor shall state under oath, on forms provided 34 by the department, the amount of such sales of goods, wares, or 35 -1- SF 2325 (3) 86 mm/sc/jh 1/ 2
S.F. 2325 merchandise, or services furnished and used in the performance 1 of such contract, and upon which sales or use tax has been 2 paid, and shall file such forms with the designated nonprofit 3 hospital which has made any written contract for performance 4 by the contractor. 5 d. On or after July 1, 2017, but not more than three 6 years after final settlement has been made, the designated 7 nonprofit hospital shall make application to the department 8 for any refund of the amount of the sales or use tax which 9 shall have been paid upon any goods, wares, or merchandise, 10 or services furnished. The application shall be made in the 11 manner prescribed by the department and upon forms provided by 12 the department. The department shall audit the claim and, if 13 approved, issue a warrant to the designated nonprofit hospital 14 in the amount of the sales or use tax which has been paid to the 15 state of Iowa under the contract. However, for sales and use 16 tax paid between January 1, 2014, and July 1, 2017, the total 17 eligible refund shall be amortized equally over two calendar 18 years, and the department shall issue one warrant each calendar 19 quarter for forty-eight calendar quarters until the total 20 applicable refund amount has been issued. 21 e. The total amount of refunds provided pursuant to this 22 subsection shall not exceed two million dollars. 23 f. Any contractor who willfully makes a false report of 24 tax paid under the provisions of this subsection is guilty of 25 a simple misdemeanor and in addition shall be liable for the 26 payment of the tax and any applicable penalty and interest. 27 g. This subsection is repealed July 1, 2022, or thirty 28 days following the date on which two million dollars in total 29 refunds have been provided. 30 -2- SF 2325 (3) 86 mm/sc/jh 2/ 2