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TC Res. No. 1985-06RESOLUTION NO. 85-6 SERIES OF,1985 A RESOLUTION EXPRESSING OPPOSITION TO SALES`TAX "SIDIPLIFICATION"LEGISLATION WHICH WOULD ELIMINATE LOCAL CONTROL OF THE MUNICIPAL SALES TAX BASE AND LOCAL CONTROL OF SALES TAX ENFORCEMENT WHEREAS, the Town of Avon has a sales tax which is levied, collected and enforced locally; and WHEREAS, the municipal sales tax is-the principal tax source for our municipality; and WHEREAS, sales tax simplification legislation recommended by the interim Business Issues Committee for consideration during the 1985 legislative session would require the local sales tax base and definitions to conform with the state base and definitions, centralize enforcement and auditing powers and could reduce local sales and use tax revenues of home rule municipalities; and WHEREAS, the state base has become unreliable and, smaller in recent years through enactment of many exemptions; and WHEREAS, the Town of Avon supports many revisions in the sales and use tax system which will streamline state and local sales taxes without major loss of local control or local.revenues; NOW, THEREFORE, BE IT RESOLVED BY THE TOWN OF AVON, THAT THE TOWN COUNCIL: 1. Opposes any sales tax legislation which ties the- ,local-sales tax to the state tax base with or without local options; 2.. Opposes granting the Department of Revenue unilateral authority to determine and control all definitions relating to local sales tax bases; 3. opposes centralizatioh-of,auditing, enforcement and appeals authority in the Department of Revenue; 4. Opposes efforts to provide tax reductions to special interests through state mandated reductions in. local sales taxes; 5. Supports legislation drafted by the Colorado Municipal League which would simplify the sales tax system without unduly interfering with local control of -the..sales tax" by; among other things: Requiring use of a standardized sales and use tax reporting form for all home rule- municipal- ities which collect their own sales tax;` Providing single audit sales and use.tax protection at the option of the taxpayer' rather than mandatorily for.all taxpayers operating in more than one jursidiction; Making procedures of home rule municipalities uniform with the state's with respect to various collection and enforcement procedures;. Prohibiting double taxation of sales and use tax transactions; Accelerating remittance of Department of Revenue collections to those municipalities and counties whose sales taxes are collected by the state; Simplifying taxation of construction and building materials; Requiring municipalities to provide geographical maps or location guides to retailers; and Establishing a task force within state government of state and local.officials and business representatives to standardize sales and use tax definitions,and otherwise streamline state sales and use tax practices. -2- BE IT FURTHER RESOLVED that the Town Council urges its senator and representative to support sales tax simplification legislation as outlined above and vigorously oppose House Bill.1007 which would provide for state control of the local sales and use tax base, centralize enforcement activities in the Department of Revenue, or otherwise result in the loss of control and local revenues, and support the Colorado Municipal League House Bill 1099. INTRODUCED, READ, PASSED, AND ADOPTED at a regular meeting of the Council of the Town of Avon, Colorado, held on February 12, 1985. TOWN OF AVON, COLORADO Allan R. ttingham, yor -3- • 0 TO: The Honorable Mayor and Town Council FROM: William D. James, Town Manager DATE: February 6, 1985 SUBJECT: House Bill 1099 - Sales Tax Simplification Bill Two Bills have been presented this year regarding Sales Tax Simplificiation. One Bill has been presented by Representative Scherer and Senator Hefley (H.B. 1007) and one by Representative Grant and Senator Lee(H.B. 1099). House Bill 1099 is supported by the Colorado Municipal League(CML). Bascially both bills effect 33 Home Rule Municipalities who collect their own sales tax. Attached is a surmary of the two bills. Both bills address the need to simplify the sales tax process, but House Bill 1099 protects the Home Rule Municipaltities interest in local control while still providing some relief to the businesses that have to report sales tax. Attached is a resolution in support of House Bill 1099 for your consideration. ® Volume 85, No. 2 [dative Bulletin January 25, 1985 Legislative Update by;Samuel D. Mamet, Associate Director The third week of the 55th General Assembly has been maiked by speculation as to who will run for what statewide offices in 1986, not the least of which is a certain office on the first floor of the Capitol Building; potential tax increases to support the state general fund;.and where a new state prison will be sited. Also, the League's important antitrust bill was introduced last week as H.B. 1134. Sales tax simplification con- tinues to be high on the League's list of lobbying issues. Finally, special 'districts will receive special interest from the League with several League sup- ported bills scheduled for debate before the House Local Government Committee the week of January 28. Republican-leadership tax package One of the more interesting deliberations which has taken place the past two weeks at the Legislature has February 7 Legislative Conference Reservations Requested Have you mailed in your registration for the League's third annual legislative workshop? The workshop will be held Thursday, February 7, at the Denver Radisson Hotel (formerly the Down- town Denver Hilton). Governor Lamm, Morgan Smith, Executive Director of the Department of Local Affairs, House Speaker Bev Bledsoe, Senate President Ted Strickland, House Majority Leader Ron Strahle, Senate Majority Leader Dan Noble, House Minority Leader David Skaggs, and Senate Minority Leader Ray Peterson have all been confirmed as speakers. In addition, there will be panels on sales tax simplification, the state budget, issues of general municipal interest, and local government liability. That evening, the League will have an open house for municipal officials and legislators. On February 8, the League will hold its first legislative meeting of the Policy Committee at the Radisson. For further information, please contact the League office. The CML Legislative Bulletin is published by the Colorado Municipal League every other week during sessions ofthe Colorado General Assembly and mailed first class to municipal officials. Publication is from the League's office at 1500 Grant St., Suite 200, Denver, Colorado 80203. involved the House Republican Caucus' review of their leadership's tax increase proposal to shore up sagging state revenues and potential state budget deficits for FY 1985-1986 and FY 1986-1987. Specifically, House and Senate Republican leaders have proposed the following tax law changes: o Freeze state income tax indexation, which deals with inflation bracket creep. Result: additional FY 1986 revenue of $36 million and FY 1987 revenue of $53.9 million. House Caucus approved indexing at two percent on January 22. This will generate additional FY 1986 revenue of $12.1 million and FY 1987 revenue of $36.2 million. ® Repeal the graduated corporate incometak. Result: additional FY 1986 revenue of'$7.5 million and FY 1987 revenue of $15.3 million. On January 22, House Caucus approved return to graduated tax in 1988. - e Repeal the 1 /2 percent personal income tax credit, which gives individuals a $5 credit per $1,000 of income tax owed to the state. Result: additional IFY 1986 revenue of $37.3 million and FY 1987 revenue of $78.3 million. This repeal was approved by House Caucus on January 22. ® Continue the additional five-cent cigarette tax Result: additional FY 1986 revenue of $18.2 million, and FY 1987 revenue of $18.2 million. This was approved by House Caucus on January 22. These four proposals will generate $75.1 million in additional revenue for the state's general fund in FY 1986 and $148 million in FY 1987. Needless to say, some freshmen Republicans in the House were un- comfortable being placed in the position of approving such increases since many ran on tax cut, belt- tightening platforms in their, legislative races last November. However, these increases are necessary in the opinion of Republican leaders, in part because of the six percent required reserve in the state's general fund By law, the Legislature must set aside a certain portion of the general fund as a contingency or emer- gency fund. For FY 1983-1984, this amounted to $100 million. This fiscal pressure can also be attributed to the tax reductions made-to the state's general fund between 1977 and 1981. During this period of time, the general fund revenue base of the state has been reduced by over $400 million on an annual basis, according to the General Bill Information - 866-3055 House Democrats - 866-2904 House Republicans - 866-2932 Senate Democrats - 866-4865 Senate Republicans - 8664866 CML Staff - 831-6411 1 1 Governor's FY 1985-1986 executive budget request document Between 1979 and 1984, according to state budget officials, the state's,general fund reven- ues have experienced a total percentage reduction starting at 3.4 percent in 1979'and,increasing to 21 percent in 1984. In other words, permanent and re- directed revenue' reductions to the state's general fund have increased from $43.3 million in .1979 to $462.3 million in 1984. Permanent reductions are items such as income tax indexation and the sales tax food exemption. Redirected revenues include items transferred out of the general fund to other programs, such as highway transfer revenues into the Highway Users Tax Fund (HUTF). There are several other segments of the Republican leadership's tax plan which are under consideration: capping HUTF No Bill money at $50 million starting in FY 1986 (the Noble Bill expires next year); repaying the severance tax trust fund totally in FY 1985 (the Legislature borrowed money ',from this fund in FY 1983-1984 with the promise that the.money would be paid back to the fund); and continuing the six percent reserve requirement discussed above. . The House Caucus will forward proposals to the Senate Republican Caucus during the week of January 28. Upon agreement between the two cau- cuses, presumably a bill.will, then be introduced. Republican leaders appear anxious to resolve this dilemma prior to the FY 1985-1986 state budget deliberations which will begin, in March. Should you need additional information 'on this issue please contact either Sam' Mametor Ken Bueche or, on HUTF issues, Jan Gerstenberger. League antitrust bill introduced-H. B. 1134 The League's antitrust immunity legislation has been introduced as H.B.1134 and has been referred to the House State Affairs Committee. No hearing has yet been scheduled on the bill. The following legislators are members of that committee: Armstrong (Chairman), Moore (Vice-Chairman), Bond, Bryan, Dambman, Erick- son, Fish, T. Hernandez, Hover, Knox, and Younglund. Your early contact with this committee along with your own legislators urging support of the.bill is requested H.B. 1134, sponsored by Rep. Dick Mutzebaugh (R, Conifer) and Sen. Ralph Cole (R,. Littleton and Senate Judiciary Committee Chairman), will do two things: 1) Complete immunity from any antitrust action, federal or state, and whether for damages or merelyfor injunction, is provided to local governments when they engage in regulatory and licensing activities. This would include matters such as land use, zoning, and franchising. This immunity does not extend to non- governmental activities. 2) The bill amends the state, antitrust act to conform to the recent changes made in the federal statute, by eliminating actions against local governments for damages, costs, interest on damages, and attorneys' fees. Injunctive actions are preserved under the state law. Despite the recent federal legislation, county and municipal officials continue to be subject to significant antitrust liability, particularly for their regulatory and licensing activities. This; legislation was drafted in cooperation with Colorado Counties, Inc. and has strong backing from CCI and county commissioners throughout the state. When you contact your legislators, try to coordinate your efforts with your county officials. Joint letters of support of H.B. 1134 would be extremely effective. The League recently mailed to municipal attorneys background information on the legislation along with a sample resolution which your city or town could adopt Action Call: It is anticipated that this bill will be opposed strongly by private sector interests. The Colorado Homebuilders Association, for example, has adopted a position in support of amending the state antitrust law to conform it with the'recent changes in the federal law, but is opposing complete immunity for local government regulatory and licensing activities. It is important that your contact with legislators begin now and continue during the session. Coordination with your county commissioners and neighboring municipalities might be effective. Please contact Jerry Dahl at the League office forfurther information on this bill. Great news-Noble Bill monies repaid! The HUTF repayment has been made. In your December Highway Users Tax Fund (HUTF) payment, which you will receive this month,, the state has included your share of the Noble Bill funds, which is being repaid with interest Of the total HUTF amount received in your January HUTF check 56.9 percent is due to the repayment The monies are being restored as a result of 1983 legislation (enacted at a time when the state exper- ienced a severe budget shortfall) in which the Legis- lature authorized the withholding of four months of payments normally made to the Highway Users Tax Fund from a portion of the state's sales tax; it was specified by law when the $15.9 million was borrowed that this Noble Bill revenue was to be repaid with eight percent interest. The January 1985 repayment totaled $17.993 million, 18 percent of which ($3.238 million) has been apportioned to municipalities; •60 percent apportioned to the state; and 22 percent to the count- ies. Please call Jan Gerstenberger at the League office if you have any questions. Prison siting update The League has received inquiries from municipal officials around the state concerning statehouse de- liberations on-the siting of a new medium security prison. The facility is anticipated to be' a 250-bed institution with expansion to 500 beds. There has been spirited competition among municipalities around the state to get the prison sited in their area. By way of background, H.B. 1040 of 1984 directed 2 • the state Department of Corrections to make site selection recommendations to Governor Lamm and the Legislature this month. Twenty communities, many in cooperation with their counties; submitted 33 pro- posals by the November 1 deadline. The state's eval- uators consisted of staff from the Departments of Administration, Corrections, Local Affairs, Natural Resources, Health, Labor and Employment, and the Office of State Planning and Budgeting. This team named the top ten proposals in their final report Alamos" Burlington, Canon City, Craig, Delta, Julesburg, Limon, Meeker, Trinidad, and Walsenburg. Another level of analysis, applying strictly correctional concerns, narrowed the sites to seven: Canon City, Craig, Delta, Limon, Meeker, Trinidad, and Walsenburg. Finally, the evaluation report made four overall recom- mehdations, in order of priority consideration: Trinidad, Walsenburg, Delta, and Limon. On January 14, Chase Riveland, Corrections De- partment Executive Director, and Governor Lamm presented three recommended sites, in priority order to the Legislature: Trinidad, Delta, and Limon. In addition, in his letter to legislators Governor Lamm recommends consideration of a second siting study for an additional facility to be located in the Denver metropolitan area.. Total construction and operating costs for a new medium security facility range between $35.7 million (250 beds) and $49.5 million (500 beds). Whether the Legislature will build one or more such facilities, what kind of financing will be established for a prison or prisons, and where to locate the facility or facilities are all questions yet to be answered by the Legislature. This issue will likely become the focus of session-long debate and discussion. This week, the Legislature adopted a joint resolution establishing a committee of legislators to review the issue. Representing the Senate are Sens. Bishop, Wells, Arnold, and Glass; House members are: Reps. Strahle, Shoemaker, Paulson, and Artist Should you have additional questions, please contact Sam Mamet at the League Office. We strongly urge you to stay in contact with your own legislators on this issue. They ,are ,,,your best source of information as the prison debate unfolds. Special district update: H.B. 1012, 1020, 1021, and 1125 The League is actively supporting three Interim Special Districts Committee bills which have been scheduled for hearings before the House Local Government Committee the week of January 28. Please contact the committee members, in support of these bills: Faatz (Chairman), Owens (Vice Chairman), Armstrong, Bryan, Erickson, Herzog, Johnson, Moore, Mutzebaugh, Shoemaker, and Wright H.B. 1012 clarifies and expands the powers of county public improvement districts (PID) and muni- cipal general improvement districts (GID) by placing them on a parity with Title 32 metropolitan and other types of special districts. The bill gives these im- • provement districts many of the same powers as Title 32 special districts. The League proposed this bill to the Interim Committee as a means of empowering municipalities and counties with an enhanced alter- native to providing' special district services without having to create separate Title 32 special districts. Specifically, the bill: 1) Amends the PID and GID statutes to allow such districts to include territory of other jurisdictions with the consent of the other jurisdictions; clarifies that street lighting can be financed through a GID; allows the governing bodies to appoint an operating board for the district; gives such districts the power to provide the same services and finance the same improve- ments as Title 32 metropolitan districts (i.e., fire pro- tection, transportation, mosquito control, parks and recreation, etc.). 2) Amends the PID law giving such county, districts many of the same'powers which municipal GIDs have, especially via H.B. 1347 of 1984. 3) Makes clear the permissive authority of a county or municipality to create such districts. 4) Places the burden of proof for creating such districts, and the filing for an improvement district service plan meeting specific criteria, upon the dis- trict's petitioners. 5) Repeals an acreage exemption for PID& H.B. 1020 increases municipal and county control and oversight regarding the formation of new Title 32 special districts and the operation of existing and new districts. This bill: 1) Clarifies and expands the required content of service plans (i.e. compatibility of special district ser- vices and facilities with existing municipal and county facilities and services). 2) Switches the burden of proof upon the proposed district to present evidence that each criteria will be met, rather than upon the opponents to prove the contrary (as is the case in current law). Expands the county's flexibility in imposing additional briteria upon proposed districts. 3) Requires approval by the municipality's governing body prior to the formation of a special district which includes all'of its territory within a municipality. This provision is presently not available to cities and towns. 4) Enhances the method of enforcing service plans. 5) Requires special districts with no service plan to file a statement of operations with affected counties and municipalities and provides a method for enforc- ing these documents. 6) Exempts hospital districts from these various provisions. H.B. 1021 gives municipalities additional flexibility in excluding municipal territory from an existing dis- trict by deleting the proof of quality of service. Under the bill's provisions; a municipality could exclude itself from a district if the municipality agrees to provide the same service which the special district is providing upon the date of the exclusion order. In the League's 3 r~ judgment, the issue of quality of service has become a major stumbling block in achieving an exclusion order from the, district court It is subjective and difficult to prove, placing the,district court in a sensitive position. Municipal annexations of special district territory and the subsequent double taxation of services which generally arises between districts and municipalities could be significantly eased with the enactment of this legislation. Finally, the League is supporting H.B. 1125, spon- sored by Rep. Bill Owens (R, Aurora) and Sen. Wayne Allard (R, Loveland), which requires Title 32 special districts to notify by postcard persons affected by any public hearing on a service plan or on the inclusion of property within special districts. This bill is also pend- ing before the House Local Government Committee and is scheduled for a hearing January 28. Action Call: Your immediate attention to and sup- port of these four bills is requested. Contact should be made with your own legislators as well as the House Local Government Committee. These bills have a significant and positive benefit to cities and towns in their relationships with special districts. Should you need additional information, please contact Sam Mamet. Sales tax simplification bills- H. B. 1007 (oppose) and H.B. 1099 (support) As previously reported, two sales tax simplification bills have now been introduced. The interim Business Issues Committee bill sponsored by Jim Scherer (R, Idaho Springs) and Sen. Joel Hefley (R, Colorado Springs) and opposed by the League is H.B. 1007. The bill sponsored by Rep. Pat Grant (R, Denver) and Sen. Jim Lee(R, Lakewood) and supported bythe League is H.B. 1099. Both bills will be considered by the House Finance Committee. Whichever bill is reported by the House Finance Committee will then be considered by the House Appropriations Committee. Hearing dates be- fore the Finance Committee have not been set; our best guess is that the bills will not be heard before early February. Membership on these Committees is as follows: House Finance Committee: Reps. Schauer, Chairman; Neale, Vice Chairman; Bath; Berry; M.C. Bird; Green; Groff; T. Hernandez; Phillips; Trujillo. HouseAppropria- tions Committee: Reps. Kirscht, Chairman; McInnis, Vice Chairman; M.L. Bird; Bond; Brown; Fish; Gillis; Minahan; Tebedo; Trujillo; Webb. We have been very encouraged by the strong grass- roots communications of municipal officials, and the positive feedback from numerous legislators and others (see editorial). Keep up the good work and your communications! In your communications with legis- lators, the peess, civic groups, and business groups, emphasize that H.B. 1099 achieves simplification without destroying local control over the most im- portant municipal revenue source. In contrast, H.B. 1007 achieves simplification by (1) sacrificing local • control over the local sales and use tax base, (2) sacrificing local control over audit and enforcement activities, and (3) reducing sales tax revenues in numerous cities immediately, and increasing the risk of future revenue losses for all home rule municipal- ities having local sales tax administration. - Municipal fear overtying home rule municipalities to the state base seems to be well-founded. As previously reported, the state has granted 33 sales tax exemp- tions and 18 use tax exemptions in the past 10 years. Already this session there are three bills granting further sales tax exemptions to special interests. These are: • H.B. 1024 removing the $500,000 per year ceil- ing on the state exemption of machinery and machine tools used in manufacturing; • H.B. 1131 exempting preprinted newspaper inserts; and S H.B. 1132 exempting the federal excise tax por- tion of the purchase price of truck tires. Need anyone say more! The League plans to oppose each of these exemptions because of their impact on the state and local tax base. They also prove why home rule municipalities cannot be tied to a seemingly ever- reducing sales tax base. If you need more information, please contact Sam Mamet or Ken Bueche at the League office. Please share with us correspondence and feedback from legislators in these sales tax issues. League helps to defeat H.B. 1075 H.B. 1075 was postponed indefinitely by the House Judiciary Committee on January 15. The League actively lobbied to-defeat the bill. The bill, entitled "Concerning Condemnation by Eminent Domain," would have raised the interest rate on condemnation awards from 6'percent to a floating percentage estab- lished annually and would have required that the condemning authority in all cases provide the land- owner with a final written offer before initiating condemnation proceedings. Most objectionable, the bill would have required payment of the landowners' attorneys' fees by the condemning authority in three situations. (1) when the court found the condemning authority did not have the legal right to condemn, (2) when the court found that the condemning authority did not negotiate in good faith, and (3) when the court found that the final written offer was not reasonable at the time it was made and the award at trial was at least $10,000 greater than the final offer. League staff worked with lobbyists from Denver, Arvada, the Attorney Generars office, and the Depart- ment of Highways in urging defeat of the bill, which was postponed indefinitely on January 15 bya9 to 2 vote in the House Judiciary Committee. However, it is rumor- ed that the bill may be reintroduced under a more narrow title. 4 C~ League supports S. B. 38- Lawsu Its Against Public Employees S.B. 38, sponsored by Sen. Michael Callihan (D, Gunnison) and Rep. Mary Dambman (R, Colorado Springs), was approved with amendments by the Senate Judiciary Committee on January 21. As amended, the bill allows peace officers and community corrections officers who are named as defendants in lawsuits filed by criminal offenders to recover their attorneys' fees spent to defend against those actions in cases in which the court finds that the case was frivolous and lacked substantial justification. Con- versely, if the plaintiff prevails in a claim for punitive or exemplary damages, he may recover his attorneys' fees from the defendant peace officer or community corrections officer. The purpose of the bill is to allow some protection to peace officers and community corrections officers who are subjected to numerous lawsuits by jail in- mates, often for frivolous reasons. As amended by the Senate Judiciary Committee, the bill makes clear that its effect is not to make any public entity liable for punitive or exemplary damages awarded against peace officers or community corrections officers. Nor does the bill make public entities liable for defense of such actions (preserving, however, governments' right to obtain insurance for their peace officers). The bill will be up for debate on the Senate floor shortly. Please contact your Senator urging support of S.B. 38 as amended League supports H.B. 1117 H.B. 1117, sponsored by Rep. Tony Hernandez (D, Denver) and Sen. Polly Baca (D, Thornton), is a bill which, if enacted, would continue the low-interest revolving loan fund of the state Division of Housing for low- and moderate-income housing. This program which has existed for several years has strong support from cities and towns around the state which have made use of it. The bill was reported unanimously out of the House Business Affairs Committee and awaits House floor debate in the coming weeks. We urge you to contact your House members in support of H.B. 1117. League supports S.B. 35-water and sewer financing S.B. 35, the League's bill to provide loans for water and wastewater facilities and grants for water facili- ties, was heard by the Senate Local Government Committee on January 23. The bill would provide funding for those communities who have both a docu- mented health need and are in need of financial assistance. Hazel Luebke, Circuit Rider Administrator (Cripple Creek, Fairplay, and Victor), and Eddie Orif, Upper Arkansas Area Council of Governments Execu- tive Director, testified at the hearing and provided the Committee with excellent examples of the types of difficulties small communities face when trying to finance costly system improvements. Due to lack of time to consider all Committee questions, and in order 0 to allow time to provide additional information re- quested by the Committee members, the bill hearing was not concluded Action Call: As anticipated, funding forthis program will be difficult in a year when the legislature is facing other difficult budget decisions. We urge communities interested in the passage of this bill to contact members of the Senate Local Government Committee immediately. 5 s The Sentinel's editorials Tax 'simplification' threatens local control The following editorial appeared January 20 in the Grand Junction Daily Sentinel. We agree completely and wanted to share this with you. Have you spoken with your local media lately? Imagine how members of the Colorado General Assembly would react if the federal government were to announce a series of sweeping restrictions on state income tax collections. Faster than anyone could scream, "Down with those meddlesome federal polecats!", Colorado lawmakers would be up in arms. Personal income tax receipts make up the largest portion of the state Treasury. To be precise, according to figures developed by the Office of State Planning and Budget, some $982 million are generated by personal income tax collections. That figure consti- tutes 48.5 percent of the state budget. Consequently, any federal usurpation of state taxing authority would play hob with the effective administration of Colorado government. It's easy, therefore, to commiserate with public administrators at the local level about a bill designed to "simplify" Colorado sales tax collections. It's sales taxes that far and away make up the major portion of municipal budgets. Sen. Joel Hefley, a Colorado Springs Republican, and Rep. Jim Scherer, an Idaho Springs Republican, have introduced H.B. 1007, a bill that essentially would standardize local and state sales tax collections. The bill is of particular concern to Grand Junction, which collects sales tax receipts locally rather than having the state do the job for it. For that matter. H.B. 1007 is-or at least ought to be-a matter of major concern to communities throughout the Western Slope. Not only does Grand Junction collect its sales tax receipts locally, so too, do Rifle, Delta, Montrose, Durango and Cortez. While the bill would continue to permit municipali- ties to collect sales taxes locally, thereby avoiding the delay that would occur by routing the money through the state, it would restrict local governments in what they could tax or not tax In short, the bill would standardize the taxing base of local and state govern- ments except for nine specified exemptions and two "wild card" options. In many instances, that provision would not impact local governments adversely. Grand Junction's sales tax base, for example, essentially is consistent with the state's. But Breckenridge, for example, imposes a sales tax on ski equipment rentals. The state does not. If Breckenridge were to lose its ability to impose a sales tax on ski rentals, it would be losing a major revenue source. And that resort community wouldn't have a thing to say about it. Far better for the citizens of Breckenridge, through their own town council, to decide the seemliness of a tax on ski rentals than the state. Moreover, if history is a guide, the state is likely to modify its sales tax base in the coming years. The state has reduced its sales and use tax base 51 times in the past 10 years. Imagine how such state decisions could impact the long-range planning of local governments, whose capital improvements are often planned on the basis of revenue flow projections from sales taxes. There are a number of other nettlesome problems with the Hefley-Scherer bill. However, if is informed by one overriding issue-the loss of local decision-making authority. We've always have had a presumptive fondness for local control. H.B. 1007 would do too much violence to that persuasive notion. For the sake of the effective administration of local government, the Legislature would do well to turn thumbs down on this bill. ❑ Sales tax simplification is good thing, but... This editorial was printed in the January 24 Lake- wood Sentinel and is reprinted here with the Sentinel's permission. A sage once said there are two things people should neverwatch: The making of sausage and the making of laws. But our State General Assembly-for the umpteenth time-is again attempting to make a law regarding "sales tax simplification." It should.be watched. There is nothing wrong of course, with doing some- thing to simplify and standardize methods of sales tax collection among the various cities in the state. It is long overdue. It would be good for consumers and good for mer- chants-especially those who have outlets in more than one city. But one of the two bills currently before the legisla- ture dealing with sales tax simplification has a very disturbing aspect. House Bill 1007, backed primarily by the Colorado Association of Commerce and Industry, would largely give the legislature control over what items cities could tax In other words, home rule municipalities such as Lakewood would no longer be in charge of their sales tax base. If, at some time in the future, the legislature ruled, for instance, that auto tires could no longer be taxed, Lakewood would take a real punch in the budget. Since Lakewood finances about 70 percent of its municipal services with sales tax, rather than property taxes, passage of HB-1007 could have severe long- range consequences for Lakewood taxpayers. State Sen. Jim Lee, R-Lakewood, is sponsoring another simplification bill, HB 1099, which would protect local control. It has the support of the Colorado Municipal League and already has won the endorsement of both the Arvada and Wheat Ridge Chambers of Commerce. While there might be some points for compromise between the two bills, the point of local control remains critical. Allowing each city to set its own taxation guidelines may not be the most simplistic approach, but the Lee approach is best for the financial health of our cities. 6 ❑ i Legislative. Box Score Subject Status (as of January 25, 1985) (*means "with amendments") League Supported i . S.B. 35` Financing Waterand Sewer Projects. Establishes a state loan program S. Local Gov't Com. to assist municipalities and other local governments in constructing potable water and sewer facilities and' a small state grant program" applicable to potable water facilities. &B. 36' Limitations on Exemplary Damage Suits Against Peace Officers. Rep. from S. Jud Com*, Authorizes peaceofficers andcorrection officers sued forexemplary or pending 2nd reading in S. punitive'damages to recover attorney fees and costs where the suit is without substantial merit S.B. 48 Warranty of Habitability. Establishes an implied warranty of habitability' S. Bus Affairs Com. on residential rental property. = S.B. 50 Emergency Telephone Service. Amends the E-911 statute to-authorize Passed S.*,'ref. to H. Bus. Affairs financing of E-911 facilities in addition to E-911 services. Com. 1-1.11 1006 Taxation of Newly Constructed Buildings. Provides for partial year H. Fin. Com.-. property taxation of newly constructed buildings in counties in which county commissioners find county is growth impacted H.B. 1012 County and Municipal Improvement Districts Expands powers and H. Local GoVt Com: flexibility-of municipalities and counties to utilize local improvement districts as an alternative to formation of new special districts. H.B. 1020 Special District Formation Controls Amends special district control act H. Local GoVt Com: to strengthen ability of counties to deny proposed special districts. H.B. 1021 Special District Exclusions. Facilitates exclusion of territory within H. Local Govt Com. municipalities from special districts when municipality provides the same service. 1-1.11 1099 Sales Tax Simplification. CML drafted sales tax bill which simplifies H. Fin. Com. local sales and use taxes in numerous ways without imparin.9 essential local control. H.B. 1-108 Mortgage Revenue Bonds. Extends state law which allocates federal H. Bus. Affairs Com. tax exempt mortgage revenue bond authority among municipalities, " counties and the Colorado Housing Finance Authority. H.B. 1117 Revolving Loans for Housing Projects Continues the revolving loan H. Bus. Affairs Com. program for low income housing rehabilitation administered by state division of housing. H.B. 1125 Notification of Proposed Special District Formations Requires post- H. Local Govt Com. card notice to property owners in areas where new special districts or inclusions within special districts are proposed H.B. 1134 Antitrust Immunity. Grants local governments and local officials im- H. St Affairs Com. munity from damages under state antitrust law and prevents injunctive actions against local governments under federal and state antitrust laws for regulatory and licensing activities of local governments. H.B. 1135 Warranty of Habitability. Establishes an implied warranty of habitability Rep. from H. Local Govt Com.* on residential rental property. Al • • Legislative Box Score Subject Status (as of January 25, 1985) Vmeans "with amendments"; League Opposed H.B. 1007 Sales Tax Simplification. Requires local conformance (with certain H. Fin. Com. exceptions) to the state tax base, repeals local authority to impose a use tax on storage, and centralizes audit and enforcement activities in the Department of Revenue. H.B. 1018 County Local Improvement District Sales Taxes Authorizes counties to H. Fin. Com. impose sales taxes in sub areas of county to finance public improvements H.B. 1024 Machine Tool Sales Tax Exemption. Removes $500,000 per year per H. Fin. Com. firm ceiling on current state sales tax exemption on machine tools. Also applies to municipalities and counties under state system where they have adopted current state exemption. H.B. 1075 Limitations on Condemnations Requires condemning entity to pay Postponed indef. by H. Jud Com. attorney fees to property owners under varied cicrumstances and generally increases cost of condemnation. H.B. 1122 Sales Tax Exemption for Truck Tires Exempts the federal excise tax H. Fin. Com. portion of the purchase price of truck tires from the state sales tax and local sales taxes collected by the state. H.B. 1131 Sales Tax Exemption for Newspaper Inserts Exempts pre-printed H. Fin. Com. newspaper inserts from the state sales tax and local sales tax collected by the state. A2 Status as of 1/24/85 means "with amendments") NEW BILLS OF INTEREST support H.B. 1108 M.C. Bird. FINANCE - SINGLE FAMILY MORTGAGE REVENUE BONDS. Extends the past allocation formula for allocating the state ceiling on the issuance of qualified mortgage bonds under the federal mortgage subsidy bond tax act to municipalities,.counties, and the Colorado housing finance authority; and expands the allocation method and reporting ' requirements to allow for the issuance of mortgage credit certificates, authorized by the federal "Tax Reform Act of 1984". Ref. to H. Bus. Affairs and Labor Com. 119 H.B. 1134 Mutzebaugh. LIABILITY - LOCAL GUvgRNNM ANTITRUST IMMUNITY.- Provides that units of local government and their officials, agents, -and- employees are exempt from liability under antitrust laws when carrying out regulatory and-licensing activities. Provides that no damages or interest thereon, costs, or attorneys' fees may be recovered under the state antitrust laws against a local government or of agent, or employee thereof acting in an official capacity. Requires local governments to file'copies of regulatory measures with the division of local government., Authorizes the collection of~a fee by such division for its services. Contains other provisions..'Ref. to H. St. Affairs ,Com. 1/15 H.B. 1135, Mielke. IJUM3LORD AMD TENANT - WARRANTY OF HABITABILITY. Provides that all rental agreements concerning residential premises entered into on or after a specified date and containing a covenant for the payment of rent shall also contain covenants by the landlord relating to the physical condition of the premises. Provides that the tenant, ;under certain conditions; may either terminate the rental agreement or file an-action to recover damages for a, breach of the landlord's, covenant. Prohibits termination under certain circumstances and provides for affirmative_defkxams_-_Allows time for the landlord to correct a breach and prohibits the remedies from becoming effective if the breach is corrected within the time allowed. Requires that there be no waiver of any tenant or landlord .right within any rental agreement. Provides that there shall not be' any retaliatory conduct on'the part of the landlord after a tenant has pursued a remedy for a breach committed by the landlord. Rep. from H. LocaZ Gov't Com. * 1123 Of Municipal Interest S.B. 67 . Fowler. PENSIONS, - PERA -.GROUP HEALTH INSURANCE- PLAN. Establishes a group health insurance plan for retired members of the public employees' retirement association, their. survivors, and certain of their dependents. Provides for management of the plan,by the public employees' retirement board. Requires that a portion of the regular contributions made by employers to, the association be credited to the retired public employees' health insurance reserve fund to,be used to partially fund the health insurance program. Contains other provisions. Ref. to S. Fin. Com. 119 S.B. 71 Sandoval. EMPLOYMENT - ONEMPLOYMENT COMPENSATION: Makes changes to the "Colorado Employment Security Act", including: redefines "employer" to include a unit which employs at least one individual performing services at any time; provides that the definition of "employment" does not include certain kinds of casual labor; allows an employer who acquires assets of another employer to receive a total or partial transfer of the experience rating record of the predecessor employer. Contains other provisions. Ref. to S.,Bus. Affairs and Labor Com. 1/10 S.B. 73 Ezzard. ELECTIONS - PURGING OF ELECTORS. Amends the "motor- voter" initiated law, which was approved at the 1984 general election, to allow the county clerk and recorder to purge from the registration books the name of any registered elector who fails to vote in two successive general elections. Requires the county clerk and recorder, before purging the name of any such elector, to provide the elector with a form which the elector may return to such clerk and recorder to continue his registration. Allows' the county clerk and recorder to purge from the registration books of the county the name of any registered elector who fails to vote in a general election and who is determined to have moved from the county. Rep. from S. St. Affairs Com.* 1123 B-1 • S.B. 76 Cole. MOTOR VEHICLES - MANDATORY USE OF SAFETY BELTS. Requires every driver and every passenger in a.motor vehicle equipped with a safety belt system to use the safety belt and makes violation of such requirement a class B traffic infraction with a twenty- five-dollar penalty: Exempts certain persons from this requirement. Provides for a program to educate and inform the public concerning the safety belt requirement. Contains other provisions. Ref. to S. Transp. Com. 1117 S B. 77 Dodge. HAZARDOUS WASTE - 'SUPERFUND' - FUNDING OF CIVIL ACTIONS. Makes an appropriation out of 'the special iesr_rve fund to the department of law for the costs of bringing lawsuits pursuant, to the federal CERCLA act. Creates the CERCLA recovery fund, to which 'recoveries in such lawsuits will be 'credited, and provides that moneys in the CERCLA 'recovery fund may be appropriated for any lawful purpose., Authorizes appropriations out of the special reserve fund for.-the cost of bringing CERCLA lawsuits. Passed S. on 2nd reading 1123* H.B. 1109 Armstrong. LAW ENFORCEMENT - PEACE OFFICER STATUS FOR STUDENT LOAN DIVISION INVESTIGATORS. In part, grants investigators employed'by'the student loan division, when actually engaged- in performing their duties, all the powers conferred by law upon peace officers. Contains other provisions. Ref. to H. Educ. Com. 119 H.B. 1110 Neale. PENSIONS - PERA BENEFITS TO SURVIVING SPOUSES. Enables the surviving spouse of an active PERA member who died prior to July 1, 1979, after ten or more years' .service, to elect to receive an annuity based on the number of years of service at death, not cut off by remarriage of the spouse, and payable only after all surviving children are no longer eligible for survivor benefits.. Establishes procedures for election of such annuity by a surviving spouse, and includes the'opportunity to pay back any lump sum received from PERA, with interest, and to then receive the specified annuity. Ref. to H. Fin. Com.• 1/10 H.B. 1117 T. Hernandez. HOUSING - DIVISION -OF HOUSING - SHORT-TERN LOAN REVOLVING FUND. Provides for the continuation' of the revolving fund for short-term loans administered by the division of housing: Contains other provisions. Ref. to H. Bus. Affairs' and Labor Com. 1/10 H.B., 1118 T. Hernandez. LAW ENFORCEMENT - PEACE OFFICERS STANDARDS AND TRAINING BOARD. Increases the 'number of members of the peace officers standards and training board by adding'3 additional chiefs of police and 3 additional sheriffs. Requires that chiefs of police and sheriffs be appointed equally from those departments which have'. their own traininq academies and those departments which use the Colorado law enforcement training academy. Ref. to H. Jud. Com. 1/11 H.B. 1120 Kirscht. CORRECTIONS - REIMBURSEMENT FOR CONFINEMENT OF CERTAIN PERSONS. Requires' that a city, a county, or a city and county be reimbursed by the department of corrections-in an amount not less than that equal to the state's actual cost to maintain such. a prisoner in.a state correctional facility per day for: - holding, longer than seventy-two hours, any person sentenced to a state correctional facility but confined in the jail of a city, county, or city and county prior to his transfer to the facility; holding any person who is being returned or transferred to a correctional facility or community correctional facility; or holding any person prior to his extradition. Directs that such moneys be placed in the city, county, or city and county'general fund. Enables the -executive- director of the department of corrections to negotiate'.contracts for the housing of prisoners in his custody in the'jails of cities, counties,-or city and counties within the. state of Colorado and prohibits the executive director' from housing such prisoners except under such provisions. Ref. to H. LoeaZ Gov't Com. and H. Approp. Com. 1/11 H.B. 1122 Hover. TAXATION - SALES TAX - MOTOR VEHICLE TIRES. Provides that the purchase price of'motor vehicle tires shall not include the amount of any federal manufacturer's excise tax imposed on the tires.. Ref. to H. Fin. Com. 1/11 B-2 H.B. 1123 Ham* UTILITIES - COOPERATIVE ELECTRIC AiSIATIONS. Allows cooperative electric associations which have voted to exempt themselves from regulation under the "Public Utilities Law" to continue to be exempt by eliminating provisions which would have reimposed regulation on July 1, 1987. Allows exempt cooperative electric associations to extend service into an unserved, uncertified territory without obtaining a certificate of public convenience and necessity from the public utilities commission as long as notice is given to other electric public utilities and no complaint is filed with the commission. Contains other provisions. Ref. to H. Bus. Affairs and Labor Com. 1/11 H.B. 1124 M.C. Bird. CRUDE AND OFFENSES - ALCOHOL-RZrATED DRIVING OFFENSES - EVIDENCE OF FORMER CONVICTIONS. Provides that a duly authenticated copy of former convictions for drunk driving offenses shall be prima facie evidence of such former convictions and may be used in a trial as evidence against a person accused of the offense of driving a motor vehicle while his driver's license or driving privilege is denied, suspended, or revoked. Provides that identification photographs and fingerprints that are part of the record of such former convictions and of his incarceration for those convictions shall be prima facie evidence of the party's identity and may be used as evidence against him in such trial. Ref. to H. Jud. Com. 1/11 H.B. 1125 Owens. SPECIAL DISTRICTS - POSTCARD NOTIFICATION OF HEARINGS. Requires the organizers of a special district to mail postcard notification of the hearing before a board of county commissioners on a service plan to each address located within the proposed special district. Requires the secretary of a special district to mail postcard notification of the meeting of a special district board on the inclusion of territory within a special district to each address located within the area proposed to be included within the special district. Contains other provisions. Ref. to H. LocaZ Gov't Coin. 1/11 H.B. 1131 Schauer. TAXATION - SALES TAX - PREPRINTED NEWSPAPER SUPPLEMENTS. Provides that the term "tangible personal property" as used in the state sales and use tax statutes does not include preprinted newspaper supplements which become attached to or inserted in and distributed with newspapers. Ref. to H. Fin. Com. 1114 H.B. 1133 Moore. SMOKING - PUBLIC PLACES. Prohibits smoking in public places or at public meetings, except in designated smoking areas. Permits an owner or manager of a public place to designate smoking areas. Provides a penalty for violation of the act. Requires a local smoking ordinance to be no less restrictive than state law. Ref. to H. Bus. Affairs and Labor Com. 1115 H.B. 1140 Skaggs. MOTOR VESICLES - ENCOURAGING USE OF SAFETY BESTS. Allows insurance companies offering motor vehicle insurance coverage to offer a reduced premium rate to users of safety belt systems. Provides that the amount of the payment on a claim shall be reduced by an amount equal to the premium discount if the injured person was not using the safety belt system at the time of the accident. In actions for damages for negligence arising from a motor vehicle accident, creates a presumption that a person sixteen years of age or older for whom recovery is sought was fifty percent negligent if such person was not using a safety belt system at the time of the accident. Allows for admission of evidence to rebut the presumption. Contains other provisions. Ref. to H. Bus. Affairs and Labor Com. and H. Jud. Com. 1/17 H. B. 1143 Dambman. TAXATION - SALES AND USE TAX - STATE RETAIL SALES LICENSE. Increases the time of effectiveness of a license to engage in the business of selling at retail. Adjusts renewal requirements accordingly. Specifies that inactive licenses may not be renewed. Increases fees for the application for and renewal of licenses. Requires the proration of fees for such licenses when paid after a specified date in a given year. Allows application fees to be used as credit against the remittance of sales tax. Assesses a penalty against persons who engage in the business of selling at retail without obtaining a license therefor. Authorizes persons operating as tax-exempt organizations and persons conducting singular sales events for a temporary period of time to acquire licenses to engage in the business of selling at retail and sets fees accordingly. Authorizes persons operating exclusively as wholesalers to acquire licenses to engage in the business of selling at wholesale and sets fees for such licenses. Repeals article 49 of title 12, C.R.S., which requires a state license to operate or establish a store. Ref. to H. Bus. Affairs and Labor Com. 1117 H.B. 1145 Wright. TAXATION - PROPERTY TAX - MOBILE MOMffi - ELDERLY TAX DEFERRAL. Allows a person who is sixty-five years of age or older to have the ad valorem taxes on his mobile home deferred in the same manner that a person may have the taxes on his owner- occupied residence deferred. Requires that the taxpayer claiming the deferral own the mobile home or be purchasing the mobile home under a recorded instrument of sale. Requires payment of all deferred property taxes, including accrued interest, when the tax- deferred mobile home is moved. Contains other provisions. Ref. to H. Fin. Com. 1118 B-3 i, CITY : ~~-------------------------*E: -1~~~------------ RESPONDENT ' S NAME:. K1111vTELEPHONE NO.: THE LEGISLATIVE COUNCIL STAFF HAS BEEN DIRECTED BY THE HOUSE COMMITTEE ON FINANCE OF THE COLORADO GENERAL ASSEMBLY TO COLLECT INFORMATION IN ORDER TO ASSESS THE FISCAL IMPACT ON LOCAL GOVERNMENTS OF HB 1007 AND HB 1099. THESE BILLS HAVE BEEN INTRODUCED TO THE GENERAL ASSEMBLY AT ITS CURRENT LEGISLATIVE SESSION. WE WOULD APPRECIATE YOUR TAILING A FEW MINUTES 1'0 PROVIDE THIS INFORMATION. THIS INFORMATION IS VERY IMPORTANT TO EFFECTIVE POLICY ''DECISIONS. SO UNLESS OTHERWISE INDICATED. PROVIDE INFORMATION BASED ON ACTUAL 1933 COLLECTIONS. PLEASE NOTE THAT NONRESPONSE WILL BE INTERPRETTED AS A ZERO FISCAL IMPACT FOR DATA CODING PURPOSES. THEREFORE, WE WOULD LIKE TO URGE YOU.TO CAREFULLY COMPLETE EACH QUESTION. * IF YOU HAVE ANY QUESTIONS, FEEL FREE TO CONTACT CHARLIE BROWN OR LUCY SAVITZ AT 866-3521. THANE; YOU FOR YOUR ASSISTANCE. ATTACH ADDITIONAL SHEETS I-I= INSUFFICIENT* SPACE IS PROVIDED AND FEEL FREE TO FOOTNOTE ANY RESPONSES IF YOU FEEL ADDITIONAL INFORMATION WOULD BE USEFUL. --------------GENERAL INFORMATION _ 1. WHAT IS YOUR 1/1/85 EFFECTIVE TAX RATE FOR: ____4 _SALES TAX _____C2USE TAX WHAT WAS YOUR 1/1/83 EFFECTIVE TAX RATE FOR: _____SALES TAX _____LLUSE TAX 3. PLEASE INDICATE ACTUAL CY 1963 VALUES FOR THE FOLLOWING ITEMS: _ YYr+y-101 HL NET SALES TAX REVENUES TOTAL NET USE TAX REVENUES $_/~L[ZZ_Z.TOTAL GENERAL. FUND REVENUES 4. DID YOUR CITY IMPOSE A USE TAX ON THE STORAGE OF GOODS IN 1983? YES _NO IF YES, WHAT WAS THE TOTAL AMOUNT COLLECTED AS A RESULT OF THIS TAX? -------------------------=-----COMMON TO BOTH BILLS------------- 5. BOTH BILLS REQUIRE UNIFORM COLLECTION PROCEDURES IN TERMS OF STATUTE OF LIMITATIONS, PENALTIES, INTEREST, AND BOND POSTING PROVISIONS. HOW MUCH OF A REVENUE GAIN/LOSS WOULD YOU , ATTRIBUTE TO THIS ACTION FOR YOUR CITY (SEE PAGE 8 LINES 11- 19 OF HB 1007 AND PAGE 9 LINES 15-23 OF HB 1099)? GAIN 'r ' ' ' OSS• I NL''ETERM I NATE AMOUNT 14 /W.3, 1 9 0 • b. BOTH PILLS REOUIRE'STANDARDIZED REPORTING FORMS. WHAT COSTS WOULD YOUR CITY EXPECT TO INCUR AS A RESULT OF THIS REQUIREMENT (SEE PAGE 8 LINE 20 THROUGH PAGE 9 LINE 13 OF HP 1007 AND PAGE 9 LINE 24 THROUGH PAGE 10 LINE 17 OF HP 1099)? 0*7 5C,_INITIAL STARTUP _ONGOING ANNUAL INDETERMINATE AMOUNT 7. BOTH HILLS REQUIRE THAT HOME RULE CITIES PROVIDE MUNICIPAL MAPS OR LOCATION GUIDES. HOW MUCH WOULD YOU EXPECT THIS REQUIREMENI TO COST YOUR CITY (SEE PAGE 15 LINES 10 THROUGH 20 OF HP 1007 AND PAGE 12 LINE 17 THROUGH PAGE 13 LINE 1 OF HB 1099)? fep-STARTUP $ OrC%'uNGOING ANNUAL INDETERMINATE AMOUNT 8. BOTH PILLS EXEMPT-CONSTRUCTION MATERIALS FROM THE SALES TAX IF EVIDENCE IS"PROVIDED WHICH INDICATES THAT A USE TAX HAS OR WILL BE PAID (SEE PASE 2 LINE 6 THROUGH PAGE 3 LINE 1I OF HB 1007 AND PAGE. ? LINE 5 °f H!"-rOUGH PAGE 3 LINE 1.4 • OF HEM 1099). WOULD l H 1 S EFFECT YOUR C I I Y _-_YES NO FOR CY 1983. HOW MUCH WOULD YOUR CITY EXPECT 10 LOSE? LOSS INDETERMINATE AMOUNT -------HOUSE BILL 1007---------------------- 9.- HOUSE BILL 1007 PROVIDES FOR A CREDIT FOR PREVIOUSLY PAID SALES AND USE TAXES (SEE PAGE 2 LINE 7 THROUGH PAGE 4 LINE 9 AND PAGE 1S LINES -15). , WOULD'THIS EFFECT YOUR CITY? YES NO FOR CY 1983,"HOW MUCH WOULD YOUR CITY EXPECT TO LOSE? LOSS --.-INDETERMINATE AMOUNT lei . HOUSE V ILL low WOULD REQUIRE HOME RULE: CITIES I' U 1 FA X ANU EXEMPT THE SAME ITEMS AS THE STATE WITH THE EXCLPTION THAT" 'T ANY UR.FALL ILF THE THE CITIES COULD CONTINUE TO TAX OR EXEMI FOLLOWING, NINE ITEMS: FOOD, RESIDENTIAL POWER, MACHINERY AND MACHINE TOOLS, CABLE TELEVISION SERVICE, P40OM5 OR ACCOMMODATIONS, ADMISSIONS, LONG-DISTANCE ACCESS CHARGES, AVIATION FUEL, AND INDUSTRIAL POWER (SEE PAGE 4 LINE 5 THROUGH PAGE 6 LINE 21). PLEASE LIST THOSE ITEMS WHICH YOUR CITY DID TAX IN 1983 WHICH WOULD HE DISALLOWED UNDER THIS BILL HAD IT BEEN IN EFFECT AT THAT TIME AND INDICATE THE ESTIMATED REVENUE LOSSES THAT WOULD HAVE OCCURRED IN 1983. NOTE THAT ONLY AVIATION FUEL AND LODGING RATES WOULD BE ALLOWED TO VARY FROM THE STATUTORY RATE IMPOSED ON A STATE LEVEL. (please respond on the next pane) 2 ITEMS NAONGER TAXABLE REVENUE LOS INDETERMINATE IN ADDITION TO THE ABOVE ITEMS, CITIES WOULD BE ENTrrLED TO SELECT TWO ITEMS NOT OTHERWISE PROHIBITED (SEE PAGE 6 LINES 15-21) WHICH TWO WILDCARD ITEMS WOULD YOUR CITY MOST LIKELY ELECT TO USE? 12. THE BILL ALSO REQUIRES ALL CITIES TO USE THE ST'ATE'S DEFINITION OF TAXABLE ITEMS ( SEE PAGE 6 LINE 25 THROUGH PAGE 7 LINE 7). (FOR EXAMPLE, ALL CITIES WOULD USE THE STATE'S DEFINITION OF "CHARITABLE ORGAN- IZATION.") PLEASE IDENTIFY SIGNIFICANT ITEMS YOUR CITY WOULD BE REQUIRED' TO DROP FROM IT'S TAX BASE AND TI-i'_" RE :'ENU~L" LOSS I HAT WOULD HAVE U~ LUf;i:E'J IN 1Y%;-]. YOUR CITY USED THE STATE'S CURRENT DEFINI'TION' OF TAXABLE ITEMS (SEE ATTACHMENT A FOR SPECIFICATIONS). ITEMS NO LONGER TAXABLE REVENUE LOSS INDETERMINATE - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - PLEASE LIST SIGNIFICANT ADDITIONS TO YOUR CITY'S TAX B(4SE. ITEMS ADDED TO TAX BASE REVENUE GAIN INDETERMINATE 3 13. DOES YOUR CITY ANTICIPATE ANY ADDITIONAL COSTS RESULTING FROM THE PROPOSED AUDITING, ENFORCEMENT, AND APPEALS PROVISIONS (SEE PAGE 9 LINE 17 THROUGH PAGE 15 LINE 9)? f YES ___NO INDETERMINATE AMOUNT 14. THIS DILL REPEALS THE USE TAX ON THE STORAGE OF GOODS (SEE PAGE 16 LINE 15 THROUGH PAGE 19 LINE 16). THERE IS SOME CONCERN THAT THIS WOULD RESULT IN A TWOFOLD COST TO CITIES: A) A DIRECT REVENUE LOSS AND B) A LOSS ASSOCIATED WITH BUSINESSES CHOOSING TO RECLASSIFY YARIOUS ITEMS AS STORED GOODS. PLEASE INDICATE THE LOSSES ATTRIBUTABLE TO EACH ITEM EASED ON CY 1963 COLLECTIONS. A) DIRECT REVENUE LOSS .11INDETERMINAIE AMOUNT B) THE INDIRECT OR SECONDARY LOSS MAY ESE DIFFICULT TO QUANTIFY, THEREFORE, WE'VE PROVIDED TWO ALTERNATIVE MEANS TO REPORT THE LOSS. PLEASE RESPOND BOTH WAYS. / I NNE TER 1 - 3 AMOUNT LARGE SMALL ZERO LOSS LOS~IMPACT' S 15. ARE THERE ANY OTHER LOSSES/GAINS NOT WHICH YOUR CITY ANTICIPATES TO RESULT T H I S LEA; l SLH 1 1 Ui'J':' _.x _YES ; 'r NU MIN ATE. Y ESTIMAIEU IMPACT PREVIOUSLY MENTIONED FROM THE PASSAGE OF IF YES. PLEASE LIST THESE AND INDICATE TWE RELEVANT IMPACTS TO YOUR CITY EASED ON CY 1983 CULLEC 1 TONG. ' ITEM REVENUE GAIN REVENUE LOSS -----------------------HOUSE BILL 1099----------______-____------_._ 16. THIS BILL PROHIBITS CITIES FROM APPLYING THEIR USE TAXES TO THE STORAGE OF CONSTRUCTION AND BUILDING SUPPLIES ONLY (SEE PAGE 13 LINE 26 THROUGH PAGE 14 LINE 3 AND PAGE 16 LINES 4-6). PLEASE -ESTIMATE THE TWOFOLD LOSSES EXPECTED AS PER QUESTION #14 BASED ON CY 1963 COLLECTIONS. A) DIRECT REVENUE LOSSES _20I NDETERM I NATE T (please respond to part B on the next page) 4 B) THE INDIRECT OR SECONDARY LOSS'MAY BE DIFFICULT TO QUANTIFY. THEREFOkE, WE'VE PROVIDED TWO AL-TERNATIVE MEANS OF REPORTING THE LOSS. PLEASE ANSWER BOTH WAYS. / >C INDETERMINATE 1 2 3 AMOUNT ESTIMATED - LARGE SMALL ZERO IMPACT LOSS LOSS IMPACT 17. DOES YOUR CITY ANTICIPATE ANY ADDITIONAL COSTS ASSOCIATED WITH 1HE PROPUSED AUDITING, ENFORCEMENT. AND APPEALS PROV1S10NS (SEE PAGE 6 LINE 9 THROUGH PAGE 9 LINE 14)? ___YES NO IF ' YES, HOW MUCH? INDETERMINATE AMOUNT 18. HOUSE BILL 1099 PROVIDES FOR A CREDIT FOR PREVIOUSLY PAID SALES AND USE TAXES (SEE PAGE 4 LINE 1 THROUGH PAGE 5 LIME 4). WOULD THIS EFFECT YOUR CITY? ___YES %i! NO HOW MUCH WOULD YOUR CITY EXPECT TO LOSE BASED 01\! CY 117:•'13. COLLECTIONS? LOSS ' ____INDEf'ERNlNATE. AMOUNT 19. -ARE THERE ANY OTHER LOSSES/GAINS NOT PREVIOUSLY MENTIONED WHICH YOUR CITY ANTICIPATES TO RESULT FROM THE PASSAGE OF THIS BILL? YES _e,NO IF YES, PLEASE INDICATE THE RELEVANT IMPACTS -TU YOUR,CITY bASED CN CY 1587. COLLECTIONS. I T'EM REVENUE GAIN REVENUE LOSS -----------------------------REVENUE GROWTH----------------------------- 20. WHAT ARE YOUR EXPECTED GROWTH RATES FOR THE FOLLOWING ITEMS: CY 1984 CY 1965 CY 1986 SALES TAX REVENUES ` r _ ___..L'i•~ USE TAX REVENUES ___L..'_:~ GENERAL FUND REVENUES 21. IMF'ACTS HAVE BEEN REPORTED AS FOLLOWS: ACTUAL DOLLARS THOUSANDS MILLIONS NOTE: PLEASE ATTACH A COPY OF YOUR SALES AND USE TAX FORMS USED FOR 1983 TAX RETURNS ALONG WITH THE COMPLETED QUESTIONNAIRE by FEBRUARY 11. 1985 IN THE SELF-ADDRESSED. STAMPED ENVELOPE WHICH HAS SEEN ENCLOSED FOF YOUR: CONVENIENCE- _ 5