Bill Summary – FastDemocracy

Enrolled Copy                                                                         S.B. 75
                      SAND AND GRAVEL SALES TAX AMENDMENTS
                                          2023 GENERAL SESSION
                                             STATE OF UTAH
                                Chief Sponsor: Scott D. Sandall
                                House Sponsor: Bridger Bolinder
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 LONG TITLE
 General Description:
        This bill modifies provisions related to local sales and use tax.
 Highlighted Provisions:
        This bill:
        < distributes the local sales and use tax revenue from sales made by ready-mix
 concrete manufacturers to each county, city, and town with a sand and gravel
 extraction site within its boundaries;
        < specifies a formula by which the State Tax Commission apportions the revenue;
        < requires the county, city, or town to use the revenue for class B and class C roads;
        < provides direction related to sourcing in-state sales made by certain establishments;
 and
        < makes technical and conforming changes.
 Money Appropriated in this Bill:
        None
 Other Special Clauses:
        None
 Utah Code Sections Affected:
 AMENDS:
        17C-1-409, as last amended by Laws of Utah 2022, Chapter 307
        17C-1-411, as last amended by Laws of Utah 2018, Chapter 312
        17C-1-412, as last amended by Laws of Utah 2022, Chapter 21
        59-1-404, as last amended by Laws of Utah 2021, Chapter 367
       S.B. 75                                                                            Enrolled Copy
            59-12-205, as last amended by Laws of Utah 2022, Chapters 59, 82 and 403
            59-12-212, as last amended by Laws of Utah 2009, Chapter 27
32
 Be it enacted by the Legislature of the state of Utah:
            Section 1. Section 17C-1-409 is amended to read:
            17C-1-409. Allowable uses of agency funds.
            (1) (a) An agency may use agency funds:
            (i) for any purpose authorized under this title;
            (ii) for administrative, overhead, legal, or other operating expenses of the agency,
 including consultant fees and expenses under Subsection 17C-2-102(1)(b)(ii)(B) or funding for
 a business resource center;
            (iii) subject to Section 11-41-103, to pay for, including financing or refinancing, all or
 part of:
            (A) project area development in a project area, including environmental remediation
 activities occurring before or after adoption of the project area plan;
            (B) housing-related expenditures, projects, or programs as described in Section
 17C-1-411 or 17C-1-412;
            (C) an incentive or other consideration paid to a participant under a participation
 agreement;
            (D) subject to Subsections (1)(c) and (4), the value of the land for and the cost of the
 installation and construction of any publicly owned building, facility, structure, landscaping, or
 other improvement within the project area from which the project area funds are collected; or
            (E) the cost of the installation of publicly owned infrastructure and improvements
 outside the project area from which the project area funds are collected if the board and the
 community legislative body determine by resolution that the publicly owned infrastructure and
 improvements benefit the project area;
            (iv) in an urban renewal project area that includes some or all of an inactive industrial
 site and subject to Subsection (1)(e), to reimburse the Department of Transportation created
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       Enrolled Copy                                                                             S.B. 75
 under Section 72-1-201, or a public transit district created under Title 17B, Chapter 2a, Part 8,
 Public Transit District Act, for the cost of:
        (A) construction of a public road, bridge, or overpass;
        (B) relocation of a railroad track within the urban renewal project area; or
        (C) relocation of a railroad facility within the urban renewal project area;
        (v) subject to Subsection (5), to transfer funds to a community that created the agency;
 or
        (vi) subject to Subsection (1)(f), for agency-wide project development under Part 10,
 Agency Taxing Authority.
        (b) The determination of the board and the community legislative body under
 Subsection (1)(a)(iii)(E) regarding benefit to the project area shall be final and conclusive.
        (c) An agency may not use project area funds received from a taxing entity for the
 purposes stated in Subsection (1)(a)(iii)(D) under an urban renewal project area plan, an
 economic development project area plan, or a community reinvestment project area plan
 without the community legislative body's consent.
        (d) (i) Subject to Subsection (1)(d)(ii), an agency may loan project area funds from a
 project area fund to another project area fund if:
        (A) the board approves; and
        (B) the community legislative body approves.
        (ii) An agency may not loan project area funds under Subsection (1)(d)(i) unless the
 projections for agency funds are sufficient to repay the loan amount.
        (iii) A loan described in Subsection (1)(d) is not subject to Title 10, Chapter 5,
 Uniform Fiscal Procedures Act for Utah Towns, Title 10, Chapter 6, Uniform Fiscal
 Procedures Act for Utah Cities, Title 17, Chapter 36, Uniform Fiscal Procedures Act for
 Counties, or Title 17B, Chapter 1, Part 6, Fiscal Procedures for Local Districts.
        (e) Before an agency may pay any tax increment or sales tax revenue under Subsection
 (1)(a)(iv), the agency shall enter into an interlocal agreement defining the terms of the
 reimbursement with:
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        S.B. 75                                                                         Enrolled Copy
        (i) the Department of Transportation; or
        (ii) a public transit district.
        (f) Before an agency may use project area funds for agency-wide project development,
 as defined in Section 17C-1-1001, the agency shall obtain the consent of the taxing entity
 committee or each taxing entity party to an interlocal agreement with the agency.
        (2) (a) Sales and use tax revenue that an agency receives from a taxing entity is not
 subject to the prohibition or limitations of Title 11, Chapter 41, Prohibition on Retail Facility
 Incentive Payments Act.
        (b) An agency may use sales and use tax revenue that the agency receives under an
 interlocal agreement under Section 17C-4-201 or 17C-5-204 for the uses authorized in the
 interlocal agreement.
        (3) (a) An agency may contract with the community that created the agency or another
 public entity to use agency funds to reimburse the cost of items authorized by this title to be
 paid by the agency that are paid by the community or other public entity.
        (b) If land is acquired or the cost of an improvement is paid by another public entity
 and the land or improvement is leased to the community, an agency may contract with and
 make reimbursement from agency funds to the community.
        (4) Notwithstanding any other provision of this title, an agency may not use project
 area funds, project area incremental revenue as defined in Section 17C-1-1001, or property tax
 revenue as defined in Section 17C-1-1001, to construct a local government building unless the
 taxing entity committee or each taxing entity party to an interlocal agreement with the agency
 consents.
        (5) For the purpose of offsetting the community's annual local contribution to the
 Homeless Shelter Cities Mitigation Restricted Account, the total amount an agency transfers in
 a calendar year to a community under Subsections (1)(a)(v), 17C-1-411(1)(d), and
 17C-1-412(1)(a)(x) may not exceed the community's annual local contribution as defined in
 Subsection [59-12-205(5)] 59-12-205(4).
        Section 2. Section 17C-1-411 is amended to read:
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        Enrolled Copy                                                                              S.B. 75
        17C-1-411. Use of project area funds for housing-related improvements and for
 relocating mobile home park residents -- Funds to be held in separate accounts.
        (1) An agency may use project area funds:
        (a) to pay all or part of the value of the land for and the cost of installation,
 construction, or rehabilitation of any housing-related building, facility, structure, or other
 housing improvement, including infrastructure improvements related to housing, located in any
 project area within the agency's boundaries;
        (b) outside of a project area for the purpose of:
        (i) replacing housing units lost by project area development; or
        (ii) increasing, improving, or preserving the affordable housing supply within the
 boundary of the agency;
        (c) for relocating mobile home park residents displaced by project area development,
 whether inside or outside a project area; or
        (d) subject to Subsection (4), to transfer funds to a community that created the agency.
        (2) (a) Each agency shall create a housing fund and separately account for project area
 funds allocated under this section.
        (b) Interest earned by the housing fund described in Subsection (2)(a), and any
 payments or repayments made to the agency for loans, advances, or grants of any kind from the
 housing fund, shall accrue to the housing fund.
        (c) An agency that designates a housing fund under this section shall use the housing
 fund for the purposes set forth in this section or Section 17C-1-412.
        (3) An agency may lend, grant, or contribute funds from the housing fund to a person,
 public entity, housing authority, private entity or business, or nonprofit corporation for
 affordable housing or homeless assistance.
        (4) For the purpose of offsetting the community's annual local contribution to the
 Homeless Shelter Cities Mitigation Restricted Account, the total amount an agency transfers in
 a calendar year to a community under Subsections (1)(d), 17C-1-409(1)(a)(v), and
 17C-1-412(1)(a)(x) may not exceed the community's annual local contribution as defined in
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        S.B. 75                                                                           Enrolled Copy
 Subsection [59-12-205(5)] 59-12-205(4).
         Section 3. Section 17C-1-412 is amended to read:
         17C-1-412. Use of housing allocation -- Separate accounting required -- Issuance
 of bonds for housing -- Action to compel agency to provide housing allocation.
         (1) (a) An agency shall use the agency's housing allocation to:
         (i) pay part or all of the cost of land or construction of income targeted housing within
 the boundary of the agency, if practicable in a mixed income development or area;
         (ii) pay part or all of the cost of rehabilitation of income targeted housing within the
 boundary of the agency;
         (iii) lend, grant, or contribute money to a person, public entity, housing authority,
 private entity or business, or nonprofit corporation for income targeted housing within the
 boundary of the agency;
         (iv) plan or otherwise promote income targeted housing within the boundary of the
 agency;
         (v) pay part or all of the cost of land or installation, construction, or rehabilitation of
 any building, facility, structure, or other housing improvement, including infrastructure
 improvements, related to housing located in a project area where a board has determined that a
 development impediment exists;
         (vi) replace housing units lost as a result of the project area development;
         (vii) make payments on or establish a reserve fund for bonds:
         (A) issued by the agency, the community, or the housing authority that provides
 income targeted housing within the community; and
         (B) all or part of the proceeds of which are used within the community for the purposes
 stated in Subsection (1)(a)(i), (ii), (iii), (iv), (v), or (vi);
         (viii) if the community's fair share ratio at the time of the first adoption of the project
 area budget is at least 1.1 to 1.0, make payments on bonds:
         (A) that were previously issued by the agency, the community, or the housing authority
 that provides income targeted housing within the community; and
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        Enrolled Copy                                                                            S.B. 75
         (B) all or part of the proceeds of which were used within the community for the
 purposes stated in Subsection (1)(a)(i), (ii), (iii), (iv), (v), or (vi);
         (ix) relocate mobile home park residents displaced by project area development;
         (x) subject to Subsection (7), transfer funds to a community that created the agency; or
         (xi) pay for or make a contribution toward the acquisition, construction, or
 rehabilitation of housing that:
         (A) is located in the same county as the agency;
         (B) is owned in whole or in part by, or is dedicated to supporting, a public nonprofit
 college or university; and
         (C) only students of the relevant college or university, including the students'
 immediate families, occupy.
         (b) As an alternative to the requirements of Subsection (1)(a), an agency may pay all or
 any portion of the agency's housing allocation to:
         (i) the community for use as described in Subsection (1)(a);
         (ii) a housing authority that provides income targeted housing within the community
 for use in providing income targeted housing within the community;
         (iii) a housing authority established by the county in which the agency is located for
 providing:
         (A) income targeted housing within the county;
         (B) permanent housing, permanent supportive housing, or a transitional facility, as
 defined in Section 35A-5-302, within the county; or
         (C) homeless assistance within the county;
         (iv) the Olene Walker Housing Loan Fund, established under Title 35A, Chapter 8,
 Part 5, Olene Walker Housing Loan Fund, for use in providing income targeted housing within
 the community;
         (v) pay for or make a contribution toward the acquisition, construction, or
 rehabilitation of income targeted housing that is outside of the community if the housing is
 located along or near a major transit investment corridor that services the community and the
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        S.B. 75                                                                        Enrolled Copy
 related project has been approved by the community in which the housing is or will be located;
 or
        (vi) pay for or make a contribution toward the expansion of child care facilities within
 the boundary of the agency, provided that any recipient of funds from the agency's housing
 allocation reports annually to the agency on how the funds were used.
        (2) (a) An agency may combine all or any portion of the agency's housing allocation
 with all or any portion of one or more additional agency's housing allocations if the agencies
 execute an interlocal agreement in accordance with Title 11, Chapter 13, Interlocal Cooperation
 Act.
        (b) An agency that has entered into an interlocal agreement as described in Subsection
 (2)(a), meets the requirements of Subsection (1)(a) or (1)(b) if the use of the housing allocation
 meets the requirements for at least one agency that is a party to the interlocal agreement.
        (3) The agency shall create a housing fund and separately account for the agency's
 housing allocation, together with all interest earned by the housing allocation and all payments
 or repayments for loans, advances, or grants from the housing allocation.
        (4) An agency may:
        (a) issue bonds to finance a housing-related project under this section, including the
 payment of principal and interest upon advances for surveys and plans or preliminary loans;
 and
        (b) issue refunding bonds for the payment or retirement of bonds under Subsection
 (4)(a) previously issued by the agency.
        (5) (a) Except as provided in Subsection (5)(b), an agency shall allocate money to the
 housing fund each year in which the agency receives sufficient tax increment to make a
 housing allocation required by the project area budget.
        (b) Subsection (5)(a) does not apply in a year in which tax increment is insufficient.
        (6) (a) Except as provided in Subsection (5)(b), if an agency fails to provide a housing
 allocation in accordance with the project area budget and the housing plan adopted under
 Subsection 17C-2-204(2), the loan fund board may bring legal action to compel the agency to
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        Enrolled Copy                                                                           S.B. 75
 provide the housing allocation.
        (b) In an action under Subsection (6)(a), the court:
        (i) shall award the loan fund board reasonable attorney fees, unless the court finds that