Bill Text: GA HB1049 | 2009-2010 | Regular Session | Introduced

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Sales and use tax; less than 1 percent tax to fund local projects; provisions

Sponsorship: Bipartisan Bill

Status: (Introduced - Dead) 2010-03-22 - House Committee Favorably Reported [HB1049 Detail]

Download: Georgia-2009-HB1049-Introduced.html

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10 LC 33 3371

House Bill 1049

By: Representatives Stephens of the 164th, Abrams of the 84th, Wilkinson of the 52nd, Wix of the 33rd, Fludd of the 66th, and others

A BILL TO BE ENTITLED
AN ACT

To amend Chapter 8 of Title 48 of the Official Code of Georgia Annotated, relating to sales and use taxes, so as to provide for increments of less than 1 percent sales tax to be approved by local voter referendum and used to fund locally determined projects for the support and improvement of community cultural and other locally determined qualified projects supporting economic development within special local community support districts within the state; to provide for legislative findings; to provide for definitions; to provide for the creation of districts; to provide for referendums for the approval of sales and use taxes for the districts; to provide for distribution of funds; to provide for the management of the districts; to exempt such taxes from the maximum ceiling; to provide for related matters; to repeal conflicting laws; and for other purposes.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:

SECTION 1.

The General Assembly finds that:

(1) There exists different and critically important needs and opportunities for economic and community development in local communities throughout Georgia using local community cultural assets, programs, and projects;

(2) Strong and sustainable local cultural institutions are significant community assets serving important public functions by encouraging local economic development, providing resources for improvement of local schools and student performance, and encouraging the growth of a creative local economy and quality of life, all of which contribute to the overall economic development of the State of Georgia;

(3) Support of existing local cultural and community specific assets and qualified local projects are best identified and regulated by local communities who may best determine through a local referendum the amount, term, and scope of such support as might be provided by each local community;

(4) Cultural organizations exist in a variety of forms and sizes throughout the State of Georgia and flexibility is required in funding support to meet the significant differences in the needs of such cultural organizations based on their size; and

(5) Each county in Georgia should have the opportunity to present to its citizens for referendum approval a resolution creating special local community support districts for economic development and quality of life and imposing an incremental sales tax of less than 1 percent in support of projects tailored to its local needs and priorities to sustain existing qualified local cultural institutions and other qualified local projects within such district.

SECTION 2.

Chapter 8 of Title 48 of the Official Code of Georgia Annotated, relating to sales and use taxes, is amended by adding a new article to read as follows:

"ARTICLE 5

48-8-240.

As used in this article, the term:

(1) 'Allocation plan' means the formula for the division of funds raised by the local levy approved by the citizens of each district as authorized by Code Section 48-8-242.

(2) 'Artist and support organization' means an organization which is a qualified local cultural organization that has average annual gross revenues of less than $75,000.00 for its past three fiscal years.

(3) 'District' means a special local community support district for economic development and quality of life created pursuant to Code Section 48-8-241.

(4) 'Gross revenues' means the not for profit operating revenues from all sources earned by or funds paid or contributed to a qualified local cultural organization for performances, exhibitions, or activities within a district, except for capital construction fund income, designated funds raised for specific capital needs, or endowment corpus as shown by financial statements prepared in accordance with uniform accounting principles.

(5) 'Local levy' means the district-wide sales and use tax authorized pursuant to Code Section 48-8-242.

(6) 'Qualified local cultural organization' means a private not for profit arts and cultural organization having as its primary purpose the advancement of art, music, theater, dance, history, natural history, animal sciences, or botanical research or the advancement and preservation of plant sciences through horticultural display that is serving the public and advancing local economic and cultural development and strengthening local education and that:

(A) Has been continuously producing or presenting seasons of cultural programs within the district for a period of not less than five years, and if operating in more than one district shall be deemed for the purposes of this article to operate in each such district pro rata on the basis of the service activity and budgets for operations in each district;

(B) Is qualified under Section 501(c)(3) of the Internal Revenue Code;

(C) Is open to the general public with or without fee, excluding projects, events, or organizations that are extensions of academic programs for which more than 50 percent of the participants receive academic credits;

(D) Provides publicly available periodic financial information and, if the organization has annual gross revenues greater than $250,000.00, provides an audit; and

(E) Is neither an agency of the state nor a political subdivision of the state, nor an organization with average annual gross revenues for its past three fiscal years greater than $300,000.00 which receives more than 30 percent of its annual gross revenues or total capital funding from governmental funding excluding funds provided for re-granting to other qualified local cultural organizations.

These may include, without limitation, museums, visual and performing arts centers and visual and performing arts organizations, zoos, aquariums, botanical gardens, and natural history organizations.

(7) 'Qualified local initiative' means a public authority, governmental entity, or private not for profit organization qualified under Section 501(c)(3) of the Internal Revenue Code, each of which has operated within the district for a period of not less than three years providing a public service or function by advancing local community development and improvement through the creation or operation of sports or recreational facilities or activities; after school or other educational programs; improvements in public safety; crime prevention; the acquisition, development, and maintenance of public parks, trails, and bikeways; the maintenance and improvement of public roads or transportation; or the creation of jobs within the district.

(8) 'Supervising organization' means the administrative entity established pursuant to Code Section 48-8-244 to manage, supervise, and distribute funds of a district.

48-8-241.

(a) Pursuant to the authority granted by Article IX, Section II, Paragraph VI of the Constitution, a special local community support district for economic development and quality of life may be created:

(1) By any county in which is located one or more qualified local cultural organizations having combined annual gross revenues in excess of $100 million;

(2) By any county in which is located one or more qualified local cultural organizations having combined annual gross revenues equal to or less than $100 million; or

(3) By agreement of two or more contiguous counties seeking to create a joint district.

A county may not be a part of more than one district.

(b) Any such district shall be created by resolution of the governing authority of the county or by joint resolution of the governing authorities of two or more contiguous counties which shall be submitted for approval to the voters within each such proposing county and, for joint districts, shall be approved by the voters in each county within the proposed district. Subject to voter approval, such resolution shall propose to create a district and to levy an incremental sales and use tax as set forth in Code Section 48-8-242 for the purpose of funding both operating support and capital improvements of qualified local cultural organizations and other specifically identified qualified local initiatives for economic development within the proposed district. A district shall cease to exist upon the expiration of the levy.

48-8-242.

(a) On and after January 1, 2011, a single sales and use tax of up to 1 percent may be levied pursuant to the requirements of this Code section in a district in increments of one-tenth of 1 percent, as provided in this article, which shall fund:

(1) Qualified local cultural organizations for operating support and capital improvements at the election of the qualified local cultural organization; and

(2) Other qualified local initiatives within the district.

Except as to rate, the tax shall correspond to the tax imposed and administered by Article 1 of this chapter.

(b) Any county which proposes to create a district pursuant to paragraph (1) or (2) of subsection (a) of Code Section 48-8-241 may propose by resolution of the applicable governing authority or any two or more contiguous counties which propose to create a joint district pursuant to paragraph (3) of subsection (a) of Code Section 48-8-241 may propose by joint resolution to levy a special incremental sales and use tax:

(1) For a district created pursuant to paragraph (1) of subsection (a) of Code Section 48-8-241 equal to not less than three-tenths of 1 percent for a term of 15 years; or

(2) For a district created pursuant to paragraph (2) or (3) of subsection (a) of Code Section 48-8-241 equal to not less than one-tenth of 1 percent for a term not to exceed 15 years as determined by the governing authority or applicable governing authorities, in the case of joint districts.

Such resolution shall also include the identification of the public services and function and uses of such proposed tax moneys, the proposed allocation plan, the identification of any qualified local initiative proposed by the governing authority or governing authorities, in the case of joint districts, for support of qualified local cultural organizations that would be supported by such levy and the expected public benefits to be received. Such resolution shall be submitted for approval to voters within each proposing county. The procedures for conducting the referendum shall correspond generally to the procedures provided for in Part 1 of Article 3 of this chapter relating to the county special 1 percent sales and use tax.

48-8-243.

(a) The moneys generated from any local levy approved by the voters and imposed under this article shall be distributed quarterly by the supervising organization of the district pursuant to the allocation plan as follows:

(1) One and one-half percent of said total local levy shall be distributed to the governing authority or governing authorities, in the case of joint districts, imposing the local levy to pay for administrative expenses incurred by such governing authority or authorities and the district's supervising organization;

(2) In districts created pursuant to paragraph (1) of subsection (a) of Code Section 48-8-241:

(A) One percent of the first three-tenths of 1 percent levied shall be distributed to the supervising organization for competitive awards of project funding to artist and support organizations on the basis of criteria and guidelines issued by the supervising organization; and

(B) Fifty-five percent of the first three-tenths of 1 percent levied shall be distributed by the supervising organization to qualified local cultural organizations within such district as follows:

(i) To the largest 10 percent of qualified local cultural organizations, excluding artist and support organizations, a total sum equal to 15 percent of their combined average annual gross revenues for their past three fiscal years;

(ii) To the next largest 30 percent of qualified local cultural organizations, excluding artist and support organizations, a total sum equal to 17 percent of their combined average annual gross revenues for their past three fiscal years; and

(iii) To the remaining 60 percent of qualified local cultural organizations, excluding artist and support organizations, a total sum equal to 19 percent of their combined average annual gross revenues for their past three fiscal years;

(3) In districts created pursuant to paragraph (2) or (3) of subsection (a) of Code Section 48-8-241, 55 percent of the first one-tenth of 1 percent levied shall be distributed by the supervising organization to qualified local cultural organizations in accordance with locally created and uniformly applied rules and guidelines; and

(4) The balance of said total local levy shall be distributed to qualified local initiatives to perform the public service and public functions as set forth in the resolution approved by the voters.

(b) Each such qualified local cultural organization funded under this Code section shall receive 80 percent of the specified percentage of their average annual gross revenues for their past three fiscal years subject only to meeting uniform guidelines for financial reporting and stability established by the supervising organization. Each such qualified local cultural organization may compete with other such organizations in their size group for single or multi-year grants of the remaining 20 percent allocated to their group on the basis of criteria and guidelines issued by the supervising organization. If the collected amounts of incremental sales tax revenues available for distribution are insufficient to fund the total amount each qualified local cultural organization would receive under this article, then the distribution to each organization shall be made on a pro-rata basis.

48-8-244.

The management, supervision, and distribution of funds of each district shall be vested in a supervising organization created by, appointed by, or contracted with by the authorizing county commission or commissions. Each supervising organization shall have a governing board or committee empowered to exercise the responsibilities of the supervising organization under this article that shall be composed of 50 percent representatives of qualified local cultural organizations and in which all members of the governing board or committee shall recuse themselves from participating in issues presenting a direct conflict of personal interests. Such supervising organization shall elect its own chairperson and establish its own bylaws in conformance with the obligations imposed by this article and shall report annually on all expenditures and distributions to the authorizing county commission or commissions. Such supervising organizations shall have the following duties and responsibilities:

(1) To administer the funding of qualified local cultural organizations and qualified local initiatives in accordance with this article and as approved by the voters;

(2) To receive in trust and administer the distribution of all funds received from the locally approved levy under the provisions of this article;

(3) To properly determine and uniformly calculate the amounts to be received by each qualified local cultural organization under the provisions of this article;

(4) To institute and administer competitive grant programs for the support of cultural organizations and artists in accordance with this article;

(5) To determine and distribute the portion of the funds received from the locally approved levy to the qualified local initiatives as provided under the authorizing resolution of the county commission or commissions approved by the voters;

(6) To ensure that determinations as to funding of any recipients shall be based not on political expediency but rather on the organization's contribution to the general welfare of its intended audience and the demonstration of its relative ability to provide benefits to the citizens of the district and the state;

(7) To receive and review annual financial information from each qualified local cultural organization and qualified local initiative and prepare an annual report to the public and the authorizing county commission or commissions on all expenditures and distributions; and

(8) To employ such staff and consultants as deemed necessary to fulfill its responsibilities under this article and to perform such other tasks as may be appropriate to fulfill its purposes not inconsistent with the law."

SECTION 3.

Said chapter is further amended in Code Section 48-8-6, relating to a ceiling on local sales and use taxes, by revising subsection (b) as follows:

"(b) There shall not be imposed in any jurisdiction in this state or on any transaction in this state local sales taxes, local use taxes, or local sales and use taxes in excess of 2 percent. For purposes of this prohibition, the taxes affected are any sales tax, use tax, or sales and use tax which is levied in an area consisting of less than the entire state, however authorized, including such taxes authorized by or pursuant to constitutional amendment, except that the following taxes shall not count toward or be subject to such 2 percent limitation:

(1) A sales and use tax for educational purposes exempted from such limitation under Article VIII, Section VI, Paragraph IV of the Constitution;

(2) Any tax levied for purposes of a metropolitan area system of public transportation, as authorized by the amendment to the Constitution set out at Georgia Laws, 1964, page 1008; the continuation of such amendment under Article XI, Section I, Paragraph IV(d) of the Constitution; and the laws enacted pursuant to such constitutional amendment; provided, however, that the exception provided for under this paragraph shall only apply in a county in which a tax is being imposed under subparagraph (a)(1)(D) of Code Section 48-8-111 in whole or in part for the purpose or purposes of a water capital outlay project or projects, a sewer capital outlay project or projects, a water and sewer capital outlay project or projects, water and sewer projects and costs as defined under paragraph (3) (4) of Code Section 48-8-200, or any combination thereof and with respect to which the county has entered into an intergovernmental contract with a municipality, in which the average waste-water system flow of such municipality is not less than 85 million gallons per day, allocating proceeds to such municipality to be used solely for water and sewer projects and costs as defined under paragraph (3) (4) of Code Section 48-8-200. The exception provided for under this paragraph shall apply only during the period the tax under said subparagraph (a)(1)(D) is in effect. The exception provided for under this paragraph shall not apply in any county in which a tax is being imposed under Article 2A of this chapter;

(3) In the event of a rate increase imposed pursuant to Code Section 48-8-96, only the amount in excess of the initial 1 percent sales and use tax and in the event of a newly imposed tax pursuant to Code Section 48-8-96, only the amount in excess of a 1 percent sales and use tax; and

(4) A sales and use tax levied under Article 4 of this chapter; and

(5) A sales and use tax levied under Article 5 of this chapter.

If the imposition of any otherwise authorized local sales tax, local use tax, or local sales and use tax would result in a tax rate in excess of that authorized by this subsection, then such otherwise authorized tax may not be imposed."

SECTION 4.

All laws and parts of laws in conflict with this Act are repealed.