Bill Text: GA HB234 | 2011-2012 | Regular Session | Comm Sub

---

Bill Title: Sales and use tax exemption; aircraft engines, parts, and equipment; eliminate sunset

Spectrum: Slight Partisan Bill (Republican 5-2)

Status: (Passed) 2011-07-01 - Effective Date [HB234 Detail]

Download: Georgia-2011-HB234-Comm_Sub.html

---

11 LC 14 0540S

The Senate Finance Committee offered the following substitute to HB 234:

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 extend for a limited period of time the sales and use tax exemption regarding the sale or use of engines, parts, equipment, or other tangible personal property used in the maintenance or repair of certain aircraft; to provide for a program of tax refunds for companies creating new tourism attractions or expanding existing tourism attractions; to provide for a short title; to provide for definitions; to provide for legislative findings; to provide for conditions of eligibility and approval; to provide for agreements; to provide for procedures, conditions, and limitations; to provide for powers, duties, and responsibilities of the Governor, the Department of Community Affairs, and the governing authorities of counties and municipalities; to provide for related matters; to provide for severability; to provide for an effective date; to repeal conflicting laws; and for other purposes.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF GEORGIA:

SECTION 1.

Chapter 8 of Title 48 of the Official Code of Georgia Annotated, relating to sales and use taxes, is amended in Code Section 48-8-3, relating to exemptions from sales and use tax, by revising paragraph (86) as follows:

"(86) For the period commencing on July 1, 2007, and ending on June 30, 2011 2013, the sale or use of engines, parts, equipment, and other tangible personal property used in the maintenance or repair of aircraft when such engines, parts, equipment, and other tangible personal property are installed on such aircraft that is being repaired or maintained in this state so long as such aircraft is not registered in this state;"

SECTION 2.

Said chapter is further amended by adding a new article to read as follows:

"ARTICLE 6

48-8-270.

This article shall be known and may be cited as the 'Georgia Tourism Development Act.'

48-8-271.

As used in this article, the term:

(1) 'Agreement' means a tourism attraction agreement for a tourism attraction project entered into, pursuant to Code Section 48-8-275, on behalf of the Department of Community Affairs and an approved company.

(2) 'Approved company' means any corporation, limited liability company, partnership, limited liability partnership, sole proprietorship, business trust, or any other entity that is seeking to undertake a tourism attraction project pursuant to Code Section 48-8-275 and is approved, pursuant to subsection (b) of Code Section 48-8-274, by the Governor and by the governing authority of the city where the tourism attraction project is to be located if within a city and by the governing authority of the county where the tourism attraction project is to be located.

(3) 'Approved costs' means:

(A) For new tourism attractions:

(i) Obligations incurred for labor and to vendors, contractors, subcontractors, builders, suppliers, deliverymen, and materialmen in connection with the acquisition, construction, equipping, and installation of a new tourism attraction project;

(ii) The costs of acquiring real property or rights in real property and any costs incidental thereto;

(iii) All costs for construction materials and equipment installed at the new tourism attraction project;

(iv) The cost of contract bonds and of insurance of all kinds that may be required or necessary during the course of the acquisition, construction, equipping, and installation of a new tourism attraction project which is not paid by the vendor, supplier, deliveryman, or contractor or otherwise provided;

(v) All costs of architectural and engineering services, including but not limited to estimates, plans and specifications, preliminary investigations, and supervision of construction and installation, as well as for the performance of all the duties required by or consequent to the acquisition, construction, equipping, and installation of a new tourism attraction project;

(vi) All costs required to be paid under the terms of any contract for the acquisition, construction, equipping, and installation of a new tourism attraction project;

(vii) All costs required for the installation of utilities, including but not limited to water, sewer, sewage treatment, gas, electricity, communications, and similar facilities; and off-site construction of utility extensions if paid for by the approved company; and

(viii) All other costs comparable with those described in this subparagraph; or

(B) For existing tourism attractions, any approved costs otherwise specified in subparagraph (A) of this paragraph; provided, however, that such costs are limited to the expansion only of an existing tourism attraction and not the renovation of an existing tourism attraction.

(4) 'Incremental sales and use tax' means those state and local sales and use taxes generated by the tourism attraction project above the amount of such sales and use taxes generated by the previous use of the property on which such project is located except as otherwise provided in Code Section 48-8-278.

(5) 'Tourism attraction' means a cultural or historical site; a recreation or entertainment facility; a convention hotel and conference center; an automobile race track with other tourism amenities; a golf course facility with other tourism amenities; marinas and water parks with lodging and restaurant facilities designed to attract tourists to the State of Georgia; or a Georgia crafts and products center. A tourism attraction shall not include the following:

(A) Facilities that are primarily devoted to the retail sale of goods, shopping centers, restaurants, or movie theaters; or

(B) Recreational facilities that do not serve as likely destinations where individuals who are not residents of this state would remain overnight in commercial lodging at the tourism attraction.

(6) 'Tourism attraction project' or 'project' means the real estate acquisition, including the acquisition of real estate by a leasehold interest with a minimum term of 30 years, construction, and equipping of a tourism attraction; the construction and installation of improvements to facilities necessary or desirable for the acquisition, construction, and installation of a tourism attraction, including but not limited to surveys; installation of utilities, which may include water, sewer, sewage treatment, gas, electricity, communications, and similar facilities; and off-site construction of utility extensions if paid for by the approved company. Such term shall not include the renovation of an existing tourism attraction.

48-8-272.

The General Assembly finds and declares that the general welfare and material well-being of the citizens of this state depend in large measure upon the development of tourism in the state; that it is in the best interest of this state to induce the creation of tourism attractions or expansion of existing tourism attractions within this state in order to advance the public purposes of relieving unemployment by preserving and creating jobs that would not exist if not for the sales and use tax refund offered by the State of Georgia to approved companies and preserving and creating sources of tax revenues for the support of public services provided by the state; that the purposes to be accomplished under the provisions of this article are proper governmental and public purposes for which public moneys may be expended; and that the inducement of the creation of tourism attraction projects is of paramount importance to the economy of the state, mandating that the provisions of this article are to be liberally construed and applied in order to advance public purposes.

48-8-273.

(a) In the sole discretion of the Governor, in consideration of the execution of the agreement, each approved company shall be granted a sales and use tax refund from the incremental sales and use tax on the sales generated by the approved company and arising at the tourism attraction.

(b) The approved company shall have no obligation to refund or otherwise return any amount of this sales and use tax refund to the persons from whom the sales and use tax was collected.

(c) For all tourism attractions the term of the agreement granting the sales and use tax refund shall be ten years, commencing on the later of:

(1) The final approval of the agreement for purposes of the sales and use tax refund; or

(2) The date the tourism attraction opens for business and begins to collect sales and use taxes.

(d) Any sales and use tax collected by an approved company on sales transacted after final approval but prior to the commencement of the term of the agreement shall be refundable as if collected after the commencement of the term and applied to the approved company's first year's refund after activation of the term and without changing the term.

(e) The total sales and use tax refund allowed to the approved company over the term of the agreement shall be equal to the lesser of the total amount of the incremental sales and use tax liability of the approved company or 25 percent of the approved costs for the tourism attraction project. The incremental sales and use tax refund shall accrue over the term of the agreement in an annual amount equal to the lesser of the incremental sales and use tax liability of the approved company for that year or 2.5 percent of the approved costs.

(f) On or before March 31 of each year during the term of the agreement, an approved company shall file with the Department of Revenue a claim for the incremental sales and use tax refund collected by the approved company and remitted to the Department of Revenue during the preceding calendar year pursuant to subsection (e) of this Code section.

(g) The Department of Revenue, in consultation with the Department of Community Affairs and other appropriate state agencies, shall promulgate administrative regulations and require the filing of a refund form designed by the Department of Revenue to reflect the intent of this article.

(h) No sales and use tax refund shall be granted to an approved project which is during a tax year simultaneously receiving any other state tax incentive.

(i) Any sales and use tax refund shall be first applied to any outstanding tax obligation of the approved company which is due and payable to the state.

48-8-274.

(a) The commissioner of community affairs, in consultation with the Governor and other appropriate state agencies, shall establish standards for the filing of an application for tourism attraction projects by the promulgation of administrative regulations.

(b) An application for a tourism attraction project filed with the Department of Community Affairs shall include, but not be limited to:

(1) Marketing plans for the tourism attraction project that target individuals who are not residents of this state;

(2) A description and location of the tourism attraction project;

(3) Capital and other anticipated expenditures for the tourism attraction project and the anticipated sources of funding for such project;

(4) The anticipated employment and wages to be paid at the tourism attraction project;

(5) Business plans which indicate the average number of days in a year in which the tourism attraction project will be in operation and open to the public; and

(6) The anticipated revenues to be generated by the tourism attraction project.

(c) Following the filing of the application, the Department of Community Affairs shall submit the application to an independent consultant who shall perform an in depth analysis of the proposed project. All costs associated with such analysis shall be paid for by the approved company.

(d) The Governor may, in the Governor's sole discretion, grant approval to the tourism attraction project if the project shall:

(1) Have approved costs in excess of $1 million and such project is to be a tourism attraction;

(2) Have a significant and positive economic impact on the state considering, among other factors, the extent to which the tourism attraction project will compete directly with tourism attractions in this state and the amount by which increased state local tax revenues from the tourism attraction project will exceed the refund to be given to the approved company;

(3) Produce sufficient revenues and public demand to be operating and open to the public for a minimum of 100 days per year, including the first year of operation;

(4) Not adversely affect existing employment in the state;

(5) For each year following the third year of operation, attract a minimum of 25 percent of its visitors from nonresidents of this state; and

(6) Meet such other criteria as deemed appropriate by the Governor.

48-8-275.

Following approval by the Governor, the Department of Community Affairs shall enter into an agreement with any approved company which may also include as a partner any local development authority, and the terms and provisions of each agreement shall include, but not be limited to:

(1) The projected amount of approved costs, provided that any increase in approved costs incurred by the approved company and agreed to by the Department of Community Affairs shall apply retroactively for purposes of calculating the carry forward for unused sales and use tax refunds as set forth in subsection (e) of Code Section 48-8-273 for tax years commencing on or after July 1, 2011;

(2) A date certain by which the approved company shall have completed the tourism attraction project and begun operations. Upon request from any approved company that has received final approval, the Department of Community Affairs shall grant an extension or change, which in no event shall exceed 18 months from the date of final approval, to the completion date as specified in the agreement with an approved company; and

(3) A statement specifying the term of the agreement in accordance with subsection (c) of Code Section 48-8-273.

48-8-276.

In the event an approved company fails to abide by the terms of the agreement, then such agreement shall be void and all sales and use tax proceeds which were refunded shall become immediately due and payable back to the state and to the governing authority of any county or municipality whose approval was required under paragraph (2) of Code Section 48-8-271.

48-8-277.

An approved company may, in the discretion of the Governor, transfer its rights, duties, and obligations under the agreement to a successor company if the successor company meets the qualifications of an approved company and, upon such approval by the Governor, such successor approved company shall be authorized to receive the sales and use tax refunds for the remaining duration of the agreement if it abides by the terms of the agreement.

48-8-278.

This article shall not apply to the sales tax for educational purposes levied pursuant to Part 2 of Article 3 of this chapter and Article VIII, Section VI, Paragraph IV of the Constitution."

SECTION 3.

In the event any section, subsection, sentence, clause, or phrase of this Act shall be declared or adjudged invalid or unconstitutional, such adjudication shall in no manner affect the other sections, subsections, sentences, clauses, or phrases of this Act, which shall remain of full force and effect as if the section, subsection, sentence, clause, or phrase so declared or adjudged invalid or unconstitutional were not originally a part hereof. The General Assembly declares that it would have passed the remaining parts of this Act if it had known that such part or parts hereof would be declared or adjudged invalid or unconstitutional.

SECTION 4.

This Act shall become effective on July 1, 2011.

SECTION 5.

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