H 3619 Session 111 (1995-1996)
H 3619 General Bill, By Boan, J.L. Harris, Keegan, Kennedy and D.E. McTeer
Similar(S 521)
A Bill to provide for a statewide referendum to be held November 7, 1995, on
the question of raising the sales, use, and casual excise tax from five to six
percent in order to provide an exemption from sales tax on food and to provide
property tax relief.-short title
02/16/95 House Introduced and read first time HJ-3
02/16/95 House Referred to Committee on Ways and Means HJ-6
A BILL
TO PROVIDE FOR A STATEWIDE REFERENDUM TO BE
HELD NOVEMBER 7, 1995, ON THE QUESTION OF RAISING
THE SALES, USE, AND CASUAL EXCISE TAX FROM FIVE
TO SIX PERCENT IN ORDER TO PROVIDE AN EXEMPTION
FROM SALES TAX ON FOOD AND TO PROVIDE PROPERTY
TAX RELIEF, AND TO MAKE THE PROVISIONS OF THIS
ACT RAISING THE TAX, ELIMINATING CERTAIN
EXEMPTIONS, IMPOSING ADDITIONAL TAXES AND FEES
ON VIDEO GAMES WITH A FREE PLAY FEATURE, AND
GRANTING PROPERTY TAX RELIEF AND EXEMPTING
FOOD FROM THE SALES TAX CONTINGENT UPON A
FAVORABLE MAJORITY VOTE IN THE REFERENDUM; TO
AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976,
BY ADDING ARTICLE 11 TO CHAPTER 36 OF TITLE 12 SO
AS TO INCREASE THE SALES, USE, AND CASUAL EXCISE
TAX FROM FIVE TO SIX PERCENT, TO PROVIDE FOR THE
ADDITIONAL TAX REVENUES TO BE CREDITED TO A
SEPARATE FUND STYLED THE "PROPERTY TAX
RELIEF FUND" AND PROVIDE FOR THE
DISTRIBUTION OF REVENUES FROM THE FUND TO
REIMBURSE LOCAL GOVERNMENTS FOR REVENUE
LOSSES CAUSED BY PROPERTY TAX RELIEF; TO AMEND
SECTION 12-36-940, RELATING TO AMOUNTS RETAILERS
MAY ADD TO THE SALES PRICE, SO AS TO REFLECT THE
ADDITIONAL TAX; TO AMEND SECTION 12-36-2110, AS
AMENDED, RELATING TO THE THREE HUNDRED DOLLAR
MAXIMUM TAX ON MOTOR VEHICLES AND CERTAIN
OTHER PROPERTY, SO AS TO INCREASE THE MAXIMUM
TAX; TO AMEND SECTION 12-36-2120, AS AMENDED,
RELATING TO SALES TAX EXEMPTIONS, SO AS TO
DELETE THE EXEMPTION FOR TOLL AND ACCESS
CHARGES AND TELEGRAMS; TO AMEND SECTION
57-11-20, AS AMENDED, RELATING TO THE STATE
HIGHWAY FUND, SO AS TO REQUIRE INTEREST EARNED
ON THE FUND TO BE CREDITED TO THE FUND AND TO
REQUIRE THESE ADDITIONAL FUNDS TO BE USED FOR
ROAD CONSTRUCTION AND MAINTENANCE; TO AMEND
SECTIONS 12-21-2772, 12-21-2774, 12-21-2776, 12-21-2778,
12-21-2780, 12-21-2782, 12-21-2794, 12-21-2796, AND
12-21-2804, RELATING TO THE REGULATION OF VIDEO
GAMES WITH A FREE PLAY FEATURE PURSUANT TO THE
VIDEO GAME MACHINES ACT, SO AS TO REVISE
REQUIREMENTS RELATING TO THESE MACHINES; TO
AMEND THE 1976 CODE BY ADDING SECTIONS 12-21-2779,
12-21-2781, 12-21-2783, 12-21-2787, 12-21-2795, 12-21-2800,
AND 12-21-2801 SO AS TO PROVIDE FURTHER FOR THE
REGULATION OF VIDEO GAMES WITH A FREE PLAY
FEATURE, TO IMPOSE A TAX EQUAL TO FIFTEEN
PERCENT OF GROSS MACHINE PROCEEDS, AND TO
REQUIRE ADDITIONAL LICENSES FOR VIDEO GAMES
WITH A FREE PLAY FEATURE; TO REPEAL SECTIONS
12-21-2719, 12-21-2728, 12-21-2732, AND 12-21-2791
RELATING TO REGULATIONS OF VIDEO GAMES WITH A
FREE PLAY FEATURE; TO AMEND THE 1976 CODE BY
ADDING SECTION 59-1-460 SO AS TO REQUIRE
ADDITIONAL ANNUAL APPROPRIATIONS FOR PUBLIC
EDUCATION AND PROVIDE THE USE OF THESE
ADDITIONAL FUNDS; TO AMEND SECTION 11-11-140, AS
AMENDED, RELATING TO LIMITATION ON
APPROPRIATIONS, SO AS TO DELETE FROM THE
LIMITATION APPROPRIATIONS TO THE PROPERTY TAX
RELIEF FUND; TO REPEAL CHAPTER 10, TITLE 4,
RELATING TO THE LOCAL OPTION SALES TAX; TO
AMEND THE 1976 CODE BY ADDING SECTION 12-37-257 SO
AS TO PROVIDE ADDITIONAL HOMESTEAD EXEMPTIONS
FROM PROPERTY TAX; TO AMEND SECTION 12-37-930, AS
AMENDED, RELATING TO THE VALUATION AND
DEPRECIATION OF PERSONAL PROPERTY FOR PURPOSES
OF PROPERTY TAX, SO AS TO PROVIDE FOR ADDITIONAL
DEPRECIATION FOR PERSONAL PROPERTY USED IN
MANUFACTURING; TO AMEND SECTION 12-7-435, AS
AMENDED, RELATING TO DEDUCTIONS FROM SOUTH
CAROLINA TAXABLE INCOME OF INDIVIDUALS, SO AS TO
PROVIDE DEDUCTIONS FOR CERTAIN INCOME OF
PARTNERS, SUBCHAPTER "S" CORPORATION
SHAREHOLDERS, AND MEMBERS OF LIMITED LIABILITY
COMPANIES; TO AMEND THE 1976 CODE BY ADDING
SECTION 4-29-72 SO AS TO ELIMINATE THE MINIMUM
INVESTMENT THRESHOLD FOR FEE IN LIEU OF TAXES
AGREEMENTS; TO AMEND SECTION 4-29-10, RELATING TO
DEFINITIONS FOR PURPOSES OF INDUSTRIAL
DEVELOPMENT PROJECTS FINANCED BY SPECIAL
SOURCE BONDS, SO AS TO EXTEND ELIGIBILITY FOR
THESE PROJECTS TO UTILITY PROJECTS, TO PHASE-OUT
THE SOFT DRINKS TAX OVER THREE YEARS; TO REPEAL
ARTICLE 13, CHAPTER 21, TITLE 12, RELATING TO THE
SOFT DRINK TAX EFFECTIVE JULY 1, 1998; TO AMEND
SECTION 12-36-2120, AS AMENDED, RELATING TO SALES
TAX EXEMPTIONS, SO AS TO EXEMPT FOOD ELIGIBLE
FOR PURCHASE WITH FOOD STAMPS FROM THE SALES
TAX EFFECTIVE JULY 1, 1998, AND TO PROVIDE LOWER
TRANSITION SALES TAX RATES ON FOOD; TO AMEND
SECTION 12-4-310, AS AMENDED, RELATING TO DUTIES
OF THE DEPARTMENT OF REVENUE AND TAXATION, SO
AS TO PROVIDE THAT THE DEPARTMENT SHALL
COLLECT ALL PROPERTY TAXES ON PROPERTY
ASSESSED BY IT EXCEPT FOR BUSINESS PERSONAL
PROPERTY; TO AMEND SECTION 12-4-540, RELATING TO
DUTIES OF THE DEPARTMENT OF REVENUE AND
TAXATION, SO AS TO PROVIDE THAT THE DEPARTMENT
SHALL ASSESS BUSINESS PERSONAL PROPERTY; TO
AMEND SECTION 12-37-970, AS AMENDED, RELATING TO
PERSONAL PROPERTY TAX RETURNS, SO AS TO PROVIDE
FOR THE FILING OF SUCH RETURNS WITH THE
TAXPAYER'S INCOME TAX RETURN; TO REPEAL SECTION
12-37-905 RELATING TO RETURNS REQUIRED TO BE FILED
WITH THE COUNTY AUDITOR; TO AMEND SECTION
12-43-250, RELATING TO SALES RATIO STUDIES, SO AS TO
REQUIRE REASSESSMENTS EVERY THREE YEARS; TO
AMEND SECTION 12-43-300, AS AMENDED, RELATING TO
PROPERTY TAX APPEALS, SO AS TO PROVIDE A REVISED
APPEALS PROCEDURE; TO AMEND THE 1976 CODE BY
ADDING SECTION 12-4-580 SO AS TO ALLOW COUNTIES
TO TRANSFER THE ASSESSING FUNCTION TO THE
DEPARTMENT OF REVENUE AND TAXATION AND TO
PROVIDE THE APPLICABLE PROCEDURES FOR THE
TRANSFER; TO AMEND SECTION 12-37-90, RELATING TO
COUNTY ASSESSOR, SO AS TO CONFORM IT TO THE
PROVISIONS OF THIS ACT; TO AMEND SECTION 12-4-320,
AS AMENDED, RELATING TO FUNCTIONS OF THE
DEPARTMENT OF REVENUE AND TAXATION, SO AS TO
ALLOW THE DEPARTMENT TO WAIVE THE RETROACTIVE
ASSESSMENT OF A STATE TAX AND PROVIDE THE
CIRCUMSTANCES REQUIRED FOR THE WAIVER; TO
AMEND SECTION 12-54-160, RELATING TO AUTHORITY OF
THE DEPARTMENT WITH RESPECT TO THE WAIVER OF
PENALTIES AND INTEREST, SO AS TO PROVIDE
CIRCUMSTANCES WHEN INTEREST MAY BE WAIVED;
AND TO AMEND THE 1976 CODE BY ADDING SECTION
6-1-60 SO AS TO PROVIDE NOTICE REQUIREMENTS WITH
RESPECT TO THE BUDGET PROCESS AND TAXING POWER
OF LOCAL GOVERNMENTS.
Be it enacted by the General Assembly of the State of South
Carolina:
PART I
Referendum
SECTION 1. The State Election Commission shall conduct a
statewide referendum on November 7, 1995, on the question of
raising the sales tax in order to provide property tax relief. The
state election laws apply to this referendum, mutatis mutandis. The
commission shall canvass the results of the referendum and certify
the results to the director of the Department of Revenue and
Taxation and the Code Commissioner. The referendum question
must read substantially as follows:
"Do you favor raising the statewide sales, use, and casual
excise tax rate from five to six percent, eliminating certain
exemptions, and raising the three hundred dollar cap on motor
vehicles and certain other property in order to exempt food from
the sales tax and to grant owner-occupied residential property an
exemption from all property taxes levied for operating purposes and
to give the current owner of such property an exemption from
increases in fair market value due to reassessment programs for the
millage imposed for debt service and lease purchase payments and
to give property tax relief for manufacturing and utility property?
[] Yes
[] No
Those voting in favor of the question shall deposit a ballot with a
check or cross mark in the square after the word `Yes', and those
voting against the question shall deposit a ballot with a check or
cross mark in the square after the word `No'."
PART II
Revenues
SECTION 1. Chapter 36, Title 12 of the 1976 Code is amended
by adding:
"Article 11
Additional Sales, Use, and
Casual Excise Tax
Section 12-36-1110. An additional sales, use, and casual excise
tax equal to one percent is imposed on amounts taxable pursuant to
this chapter. Revenue of the tax imposed pursuant to this article
must be credited to the Property Tax Relief Fund in the State
Treasury, a fund separate and distinct from the general fund of the
State.
Section 12-36-1120. (A) The revenues in the Property Tax
Relief Fund must be distributed quarterly beginning October first of
each year by the Comptroller General to reimburse property taxing
jurisdictions a sum equal to that not collected in the jurisdiction for
property tax year 1996 because of Section 12-37-257(A) and any
reduction in the assessment ratio imposed pursuant to Section
12-43-220(a) for that tax year, and the additional depreciation
allowance for that tax year allowed pursuant to Section 12-37-930.
If insufficient revenues are available in the Property Tax Relief
Fund to pay the required reimbursements, the Comptroller General
shall pay the difference from the general fund of the State. County
treasurers and municipal governing bodies where appropriate shall
file quarterly reports of estimated revenue losses with the
Comptroller General in the manner and at the time the Comptroller
General directs. After making any adjustments necessary to ensure
accuracy, the Comptroller General shall make reimbursements based
on these estimates. The final accounting for the fiscal year must be
filed in the manner provided for homestead exemption
reimbursements in Section 12-37-270, mutatis mutandis. For
purposes of future distributions, property tax year 1996 is deemed
the base year.
(B) Reimbursements for subsequent tax years shall equal the
base year reimbursement from all sources plus additional amounts
from the general fund of the State to reflect further revenue losses
on taxable base year property for continuing reductions in the
assessment ratio provided in Section 12-43-220(a), the additional
depreciation allowed pursuant to Section 12-37-930 and any
reduction in the assessment ratio for property required to be titled
by a state or federal agency. Revenues in the fund over the base
year distribution must be allocated between a school portion and a
local government portion. The school portion is determined by
multiplying revenues above the adjusted base year amount by the
ratio that school tax reimbursements represented of total
reimbursements from the Property Tax Relief Fund for tax year
1996. These funds must be distributed to school districts through
the provisions of the Education Finance Act. The remaining share
for local governments must be distributed in the manner provided in
Chapter 27 of Title 6."
SECTION 2. Section 12-36-940 of the 1976 Code is amended
to read:
"Section 12-36-940. Every retailer may add to the sales
price:
(1) no amount on sales of ten cents or less;
(2) one cent on sales of eleven cents and over, but not in excess
of twenty cents;
(3) two cents on sales of twenty-one cents and over, but not in
excess of forty cents;
(4) three cents on sales of forty-one cents and over, but not in
excess of sixty cents;
(5) four cents on sales of sixty-one cents and over, but not in
excess of eighty cents;
(6) five cents on sales of eighty-one cents and over, but not in
excess of one dollar;
(7) one cent additional for each twenty cents or major fraction
thereon in excess of one dollar.
The inability, impracticability, refusal, or failure to add these
amounts to the sales price and collect from the purchaser does not
relieve the taxpayer from the tax levied by this article.
A retailer may add the amount of the tax to the sales price
and the department shall prescribe tables providing the amount to
be added to the sales price consistent with the total rate of the
tax."
SECTION 3. Section 12-36-2110 of the 1976 Code, as last
amended by Section 92, Part II, Act 497 of 1994, is further
amended to read:
"Section 12-36-2110. (A) Notwithstanding the rates
of tax imposed by this chapter, the maximum tax rate
imposed by this chapter is three hundred dollars four
percent on the first six thousand dollars and six percent on amounts
in excess of six thousand dollars, but no more than seven hundred
fifty dollars, for each sale or lease made or
executed after June 30, 1984 1996, or lease
executed after August 31, 1985, of each:
(1) aircraft, including unassembled aircraft which is to be
assembled by the purchaser, but not items to be added to the
unassembled aircraft;
(2) motor vehicle;
(3) motorcycle;
(4) boat;
(5) trailer or semitrailer, pulled by a truck tractor, as defined in
Section 56-3-20, and horse trailers but not including house trailers
or campers as defined in Section 56-3-710;
(6) recreational vehicle, including tent campers, travel trailer,
park model, park trailer, motor home, and fifth wheel; or
(7) self-propelled light construction equipment with compatible
attachments limited to a maximum of one hundred sixty net engine
horsepower.
In the case of a lease, the total tax rate required by law applies
on each payment until the total tax paid equals three hundred
dollars the total tax due. Nothing in this section
prohibits a taxpayer from paying the total tax due at the time of
execution of the lease, or with any payment under the lease. To
qualify for the tax limitation provided by this section, a lease must
specifically state the term of, and remain in force for, a period in
excess of ninety continuous days.
(B) For the sale of a manufactured home, as defined in Section
40-29-20, the tax is calculated as follows:
(1) subtract trade-in allowance from the sales price;
(2) multiply the result from (1) by sixty-five percent;
(3) if the result from (2) is no greater than six thousand
dollars, multiply by five six percent for the amount
of tax due;
(4) if the result from (2) is greater than six thousand dollars,
the tax due is three hundred sixty dollars plus two percent
of the amount greater than six thousand dollars.
However, a manufactured home is exempt from any tax that may
be due above three hundred sixty dollars as a result of the
calculation in item (4) if it meets these energy efficiency levels:
storm or double pane glass windows, insulated or storm doors, a
minimum thermal resistance rating of the insulation only of R-11
for walls, R-19 for floors, and R-30 for ceilings. However,
variations in the energy efficiency levels for walls, floors, and
ceilings are allowed and the exemption on tax due above three
hundred sixty dollars applies if the total heat loss does not
exceed that calculated using the levels of R-11 for walls, R-19 for
floors, and R-30 for ceilings. The edition of the American Society
of Heating, Refrigerating, and Air Conditioning Engineers Guide in
effect at the time is the source for heat loss calculation. The dealer
selling the manufactured home must maintain records, on forms
provided by the State Energy Office, on each manufactured home
sold which contains the above calculations and verifying whether or
not the manufactured home met the energy efficiency levels
provided for in this subsection. These records must be maintained
for three years and must be made available for inspection upon
request of the Department of Consumer Affairs or the State Energy
Office.
(C) For the sale of each musical instrument, or each piece of
office equipment, purchased by a religious organization's exempt
under Internal Revenue Code Section 501(c)(3), the maximum tax
imposed by this chapter is three hundred sixty dollars. The
musical instrument or office equipment must be located on church
property and used exclusively for the organizations exempt purpose.
The religious organization must furnish to the seller an affidavit on
forms prescribed by the commission. The affidavit must be retained
by the seller.
(D) The maximum tax levied pursuant to this chapter on the
sale or use of each item of machinery for research and development
is three hundred sixty dollars. As used in this subsection,
`machinery for research and development' means machinery used
directly and exclusively in research and development in the
experimental or laboratory sense for new products, new uses for
existing products, or for improving existing products. To be eligible
for the limitation imposed by this subsection, the machinery must
be located in a separate facility devoted exclusively to research and
development as defined in this subsection. The limitation does not
extend to machinery used in connection with efficiency surveys,
management studies, consumer surveys, economic surveys,
advertising, promotion, or research in connection with literary,
historical, or similar projects.
(E) Revenues derived from the items taxed under this section
in excess of such revenues in fiscal year 1994-95 must be credited
to the general fund of the State."
SECTION 4. Item (11) of Section 12-36-2120 of the 1976 Code
is amended to read:
"(11) Reserved (a) toll charges for the
transmission of voice or messages between telephone exchanges;
(b) charges for telegraph messages; and
(c) carrier access charges and customer access line charges
established by the Federal Communications Commission or the
South Carolina Public Service Commission;"
SECTION 5. A. The gross proceeds of sales of tangible
personal property delivered after June 30, 1996 in this State, either
under the terms of a construction contract executed before July 1,
1996, or a written bid submitted before July 1, 1996, culminating in
a construction contract entered into before or after July 1, 1996, are
exempt from the tax provided in Section 12-36-1110 of the 1976
Code if a verified copy of the contract is filed with the South
Carolina Department of Revenue and Taxation before January 1,
1997.
B. Notwithstanding the date of general imposition of the tax
imposed pursuant to Section 12-36-1110 of the 1976 Code, with
respect to services that are regularly billed on a monthly basis, the
tax is imposed beginning on the first day of the billing period
beginning on or after July 1, 1996.
SECTION 6. A. Section 57-11-20(A) of the 1976 Code, as
amended by Act 501 of 1992, is further amended to read:
"(A) All state revenues and state monies dedicated by
statute to the operation of the department must be deposited into
one fund to be known as the `state highway fund' and all federal
revenues and federal monies must be deposited into the `federal aid
highway fund'. These funds must be held and managed by the
State Treasurer separate and distinct from the general fund, except
as to monies utilized by the State Treasurer for the payment of
principal or interest on state highway bonds as provided by law.
Interest earned on the state highway fund must be credited to
it. All interest revenues must be used for road and highway
construction and maintenance and must not be used to pay
administrative expenses."
B. This section takes effect July 1, 1995.
SECTION 7. A. Section 12-21-2772 of the 1976 Code, as
added by Act 164 of 1993, is amended to read:
"Section 12-21-2772. As used in this article:
(1) `Associated equipment' means a proprietary device,
machine, or part used in the manufacture or maintenance of a video
game machine including, but not limited to, integrated circuit chips,
printed wired assembly, printed wired boards, printing mechanisms,
video display monitors, and metering devices.
(2) `Commission Department' means the
South Carolina Tax Commission Department of Revenue
and Taxation.
(3) `Distributor' means any person who buys and sells or
leases video machines or associated equipment in this State. A
distributor may also own, operate, service, or repair video machines
in this State.
(4) `Licensed establishment' means an establishment owned
or managed by a person who is licensed pursuant to Article 19 of
this chapter for the location of coin-operated nonpayout video
machines with a free play feature. The location must contain at
least one thousand two hundred and fifty square feet of floor area.
If a building contains more than one location that offers video
machines, then each location must have a separate outside entrance
and contain a floor to ceiling interior wall that does not permit
public access from one location to an adjacent location.
(5) `Machine' means an electronic video games machine that,
upon insertion of cash, is available to play or simulate the play of
games as authorized by the commission department
utilizing a video display and microprocessors in which the player
may receive free games or credits that can be redeemed for cash.
Each station of multiplayer machines is a separate machine for
purposes of this article.
(6) `Manufacturer' means any person that manufactures or
assembles and programs machines or associated replacement
equipment authorized for sale or use in this State.
(7) `Net machine income' means money put into the machine
minus money paid out in cash. `Gross machine income' means the
sum of all cash/money put into the machine.
(8) `Machine owner' means any person, other than a
distributor, who owns and operates, or
maintains, repairs, or services one or more machines in
licensed establishments. For purposes of this article
"owner/operator" is defined the same as "machine
owner".
(9) `Contraband device/equipment' or `gray area machine'
means any unlicensed machine not described in item
(12) of this section.
(10) `Service entity' means any person other than a
distributor or machine owner who repairs, services, inspects, or
examines video machines.
(11) `Credit payback value' means the expected payback value
of credit played.
(12) `Video lottery terminal' means a machine or device which
simulated the play of a game of chance and which contains a
programmable read-only memory (PROM) computer chip which
controls game play, including randomness and percentage of payout,
and which communicates all game activity including, but not
limited to, cash in, games played, credits won, credits played, and
credits paid out, to a separate computer device by means of serial
data communications, and which may be remotely polled, activated,
and deactivated by means of serial data communications.
(13) `Person' means any individual, trust, estate, partnership,
limited liability company, receiver, association, company,
corporation, or any other entity or group.
(14) `Operator' means any person who owns or manages a
location for the operation of gaming machines.
(15) `Game' means any electronically simulated game of
chance approved by the department that is displayed and played on
a licensed video gaming machine."
B. Section 12-21-2774 of the 1976 Code, as added by Act 164
of 1993, is further amended to read:
"Section 12-21-2774. Each machine licensed under this
chapter:
(1) may not have any means of manipulation that affect the
random probabilities of winning a video game;
(2) shall have one or more mechanisms that accept only coins
or cash in the form of bills. Credit card payments are not
allowed. The mechanisms must be designed to prevent
obtaining credits without paying by stringing, slamming, drilling, or
other means;
(3) must have a commission department supplied
or approved metering device that keeps a record of all cash
(total coin accepted and total credit generated by the bill acceptor)
inserted into the machine, credits played for video games, and
credits won by video players and cash refunds of winnings
and other information as prescribed by the commission
department;
(4) must be capable of being accessed on demand by
telecommunication from a central computer for purposes of polling
or reading device activities and for central computer remote
shutdown of machine operations."
C. Section 12-21-2776 of the 1976 Code, as added by Act 164
of 1993, is amended to read:
"Section 12-21-2776. (A) All machines must be
approved, registered, and licensed by the
commission department under procedures and
guidelines issued by the commission department.
(B) By July 1, 1996, all machines approved,
registered, and licensed by the commission
department must be equipped with a commission
department supplied or approved metering device. Each
machine owner, operator, or licensed establishment must establish
and implement cash controls required by the commission
department."
(C) By July 1, 1996, all video game machines must be of
the video lottery terminal variety as defined in this
article."
D. Section 12-21-2778 of the 1976 Code, as added by Act 164
of 1993, is amended to read:
"Section 12-21-2778. Each player station of a
machine must be licensed pursuant to Article 19 of this chapter by
the commission department before placement or
operation on the premises of a licensed establishment. Each
machine must have the license prominently displayed pursuant to
Article 19 of this chapter."
E. Article 20, Chapter 21, Title 12 of the 1976 Code is
amended by adding:
"Section 12-21-2779. (A) Each machine must have a
credit payback value of at least seventy percent. The department
shall establish the mechanism for ensuring that the machines
comply with this section.
(B) Video games that are affected by player skill, such as video
draw poker and blackjack, shall pay out a minimum of eighty-three
percent and no more than ninety-six percent of the amount wagered.
This standard is met when using a method of play that will provide
the greatest return to the player over a period of continuous play.
(C) Manufacturers shall file a request and receive approval by
the department prior to manufacturing machines for placement in
the State programmed for a payout greater than ninety-two percent
of the amount wagered. The department shall consider, but not be
limited to, the following factors in determining approval:
(1) the number of machines proposed for placement;
(2) market conditions;
(3) revenues in relation to net machine income for both the
State and private sector operations."
F. Section 12-21-2780 of the 1976 Code, as added by Act 164
of 1993, is amended to read:
"Section 12-21-2780. A seal must be affixed to the
commission department supplied or approved
metering device which corresponds to the license as set forth in
Section 12-21-2778."
G. Article 20, Chapter 21, Title 12 of the 1976 Code is
amended by adding:
"Section 12-21-2781. A machine may not allow more
than three dollars to be placed on a single game or award won
games or credits in excess of the value of five hundred dollars.
Violation of the provisions of this section are considered intent to
interfere with the proper operation of a machine in accordance with
Section 12-21-2794."
H. Section 12-21-2782 of the 1976 Code, as added by Act 164
of 1993, is amended to read:
"Section 12-21-2782. The commission
department shall promulgate rules and regulations regarding
the types of machines and equipment that must be licensed and the
costs associated with inspection. Notwithstanding the provisions of
Section 12-21-2774(1), any machine of a type licensed as of
July 1, 1993 July 1, 1996, in this State and which
satisfies the conditions of Section 12-21-2776(B) may continue to
operate for five two years from July 1, 1993
that date. This section may not be construed as authorizing
cash payouts for credits earned after the effective date of a
referendum prohibiting such payouts."
I. Article 20, Chapter 21, Title 12 of the 1976 Code is amended
by adding:
"Section 12-21-2783. There is a limit of five machines in
a licensed establishment."
J. Article 20, Chapter 21, Title 12 of the 1976 Code is amended
by adding:
"Section 12-21-2787. A person licensed as a machine
manufacturer, distributor, operator, or licensed establishment may
be required to submit to a background investigation. The
department shall complete the investigation within one hundred
twenty days of the date of application unless additional time is
granted in writing. This includes each partner of a partnership and
each director and officer and all stockholders of ten percent or more
in a parent or subsidiary corporation of a machine manufacturer,
distributor, or operator. A person who has been convicted of a state
or federal crime relating to gaming or gambling, or a crime that has
a sentence of two or more years is not permitted to be licensed
under this article. The department shall promulgate regulations to
establish the criteria for the investigation and to establish additional
requirements including information exchange agreements with other
governmental regulations to preserve the integrity and security of
the industry."
K. Section 12-21-2794 of the 1976 Code, as added by Act 164
of 1993, is amended to read:
"Section 12-21-2794. A person who, with intent to
manipulate the outcome, payoff, or operation of a machine,
manipulates the outcome, payoff, or operation of a machine or its
associated monitoring system, or both by physical tampering or
any other means is guilty of a felony and, upon conviction, must be
imprisoned not less than one year nor more than five years or fined
not more than one thousand dollars, or both."
L. Article 20, Chapter 21, Title 12 of the 1976 Code is
amended by adding:
"Section 12-21-2795. (A) Beginning July 1, 1996, a tax
equal to fifteen percent of the gross machine income is imposed and
must be remitted to the department weekly on a schedule
determined by the department. The revenue must be remitted by
electronic transfer in a manner provided by the department.
Revenues of this tax must be deposited to the credit of the Property
Tax Relief Fund. All payments not remitted when due must be
paid together with a penalty under the provisions of Section
12-54-40.
(B) A machine owner, operator, or licensed establishment who
falsely reports or wilfully fails to report the amount due required by
this section is guilty of a felony and, upon conviction, must be
imprisoned not less than one year nor more than five years. In
addition, the person must have his license revoked by the
department and is not eligible for licensing for at least three years
nor more than ten years, as the department determines."
M. Section 12-21-2796 of the 1976 Code, as added by Act 164
of 1993, is amended to read:
"Section 12-21-2796. A machine owner or distributor
who wilfully places a machine on location or who wilfully causes a
machine to be operated without the state supplied or
approved metering device is guilty of a felony and, upon
conviction, must be imprisoned for not less than one year nor more
than ten years, without benefit of probation, parole, or suspension
of sentence, and may be fined not more than twenty-five thousand
dollars."
N. Article 20, Chapter 21, Title 12 of the 1976 Code is
amended by adding:
"Section 12-21-2800. The department shall promulgate
regulations pertaining to the machines and persons licensed by it.
These regulations must include, but are not limited to, provisions:
(1) prohibiting the acceptance of checks or credit cards
exclusively for playing the machines;
(2) prohibiting the extension of credit, advances, loans for
playing the machines;
(3) assuring access is limited to persons twenty-one years of age
or older;
(4) prohibiting the use of any type of advertisement to promote
the play of the machines;
(5) specifying the mechanism for transmitting revenue, service,
and access information as well as revenue amounts owed
electronically;
(6) specifying the mechanism for verifying information
transmitted to the department;
(7) establishing guidelines for licensing and review of licensing
decisions, including background investigations and license
revocation; and
(8) requiring other information considered necessary by the
department to carry out the provisions of this article."
O. Article 20, Chapter 21, Title 12 of the 1976 Code is
amended by adding:
"Section 12-21-2801. (A) In addition to all other licenses
and fees, and beginning July 1, 1996, the following annual licenses
are required for the fees stated by qualified persons who meet the
definitions provided in Section 12-21-2772 and who otherwise
comply with the provisions of this article:
(1) manufacturer five thousand dollars
(2) distributor three thousand dollars
(3) service entity two thousand dollars
(4) machine owner one thousand dollars
(5) licensed establishment one hundred dollars.
(B) A machine owner shall pay a machine owner fee for the
privilege of owning and operating machines and is not required to
pay more than one device owner fee.
(C) The machine owner fee is due and payable in addition to
any licensed establishment fee resulting from the placement of
machine at that establishment. If more than one machine is placed
at a licensed establishment, only one licensed establishment fee is
due for that establishment.
(D) No license may be issued under this section unless the
applicant for a license or renewal presents to the department a
signed statement from the department and from the Internal
Revenue Service showing that the applicant does not owe the state
or federal government any delinquent taxes, penalties, or interest.
(E) No distributor, service entity, machine owner, or licensed
establishment may be issued a license under this section unless the
distributor, service entity, machine owner, or licensed establishment
has been a resident of this State for two years. The department
shall require a statement of residency to be filed with the
department as part of the application process on forms and in a
manner prescribed by the department.
(F) Licenses issued under this section apply for the period July
first through the successive June thirtieth."
P. Section 12-21-2804 of the 1976 Code, as added by Act 164
of 1993, is amended to read:
"Section 12-21-2804. (A) No person shall apply for,
receive, maintain, or permit to be used, and the commission shall
not allow to be maintained, permits or licenses for the operation of
more than eight machines authorized under Section
12-21-2720(A)(3) at a single place or premises for the period
beginning July 1, 1993, and ending July 1, 1994. After July 1,
1994, the commission may not issue nor authorize to be maintained
any licenses or permits for more than five machines authorized
under Section 12-21-2720(A)(3) at a single place or premises. Any
licenses or permits issued for the operation of machines authorized
under Section 12-21-2720(A)(3) during the period of July 1, 1993,
and July 1, 1994, for a two-year period shall continue in effect after
July 1, 1994, provided that during the period of July 1, 1994, and
July 1, 1995, no person shall maintain at a single place or premises
more than eight machines authorized under Section
12-21-2720(A)(3). No machine may be licensed or relicensed in
any location where the primary and substantial portion of the
establishment's gross proceeds is from machines licensed under
Section 12-21-2720(A)(3). The commission shall revoke the
licenses of machines located in an establishment which fails to meet
the requirements of this section. No license may be issued for a
machine in an establishment in which a license has been revoked
for a period of six months from the date of the revocation. The
term "gross proceeds" from the machines means the
establishment's portion. Reserved
(B) No person who maintains a place or premises for the
operation of machines licensed under Section 12-21-2720(A)(3)
may advertise in any manner for the playing of the machines nor
may a person offer or allow to be offered any special inducement to
a person for the playing of machines permitted under Section
12-21-2720(A)(3).
(C) No person under twenty-one years of age may receive a
payout as a result of the operation of the machines licensed under
Section 12-21-2720(A)(3).
(D) No owner, operator, or marketer may be issued a permit
by the commission for machines pursuant to Section
12-21-2720(A)(3) unless the owner, operator, or marketer has been
a resident of the State for two years. The commission shall require
a statement of residency to be filed with the commission as part of
the application process for permits issued under Section
12-21-2720(A)(3) on forms and in a manner the commission
considers appropriate. Reserved
(E) It is unlawful to operate machines licensed under Section
12-21-2720(A)(3) between the hours of midnight Saturday night
and six o'clock a.m. Monday morning.
(F) A person violating subsections (A), (B), (D),
or (E) of this section is subject to a fine of up to five thousand
dollars to be imposed by the commission. The commission, upon a
determination that the violation is wilful, may refer the violation to
the Attorney General or to the appropriate circuit solicitor for
criminal prosecution, and, upon conviction, the person must be
fined not more than ten thousand dollars or imprisoned not more
than two years, or both. The commission shall revoke the licenses
of any person issued pursuant to the provisions of Article 19 of this
chapter for a violation of subsection (C) of this section. Revocation
is pursuant to the procedures set forth in Section 12-54-90."
Q. Sections 12-21-2719, 12-21-2728, 12-21-2732, and
12-21-2791 of the 1976 Code are repealed.
R. Subject to Part I of this act, this section takes effect July 1,
1996, except subsections N. and O. take effect upon approval by the
Governor for purposes of promulgating regulations and processing
applications.
SECTION 8. Article 5, Chapter 1, Title 59 of the 1976 Code is
amended by adding:
"Section 59-1-460. (A) In addition to the regular annual
state funding provisions for K-12 public education, the General
Assembly shall appropriate additional amounts as follows:
Fiscal year 1996-97 thirty million dollars
Fiscal year 1997-98 sixty million dollars
Fiscal year 1998-99 eighty million dollars
Fiscal year 1999-00 one hundred thirty
million dollars
Fiscal year after 1990-00 one hundred eighty
million dollars.
(B) Funds appropriated pursuant to this section first must be
used to hold harmless school districts adversely impacted in the
calculations of the index of taxpaying ability as a result of
additional property tax homestead exemptions. The remaining
funds must be distributed according to the provisions of the
Education Finance Act and no local matching funds are
required."
SECTION 9. Section 11-11-140(D) of the 1976 Code is
amended to read:
"(D) Appropriations from surplus may not be made before
the first meeting of the General Assembly following the
Comptroller General's closing of the books on the fiscal year in
which the surplus occurred and may be appropriated only for
nonrecurring purposes. The provisions of this subsection do not
apply to appropriations for the Property Tax Relief Fund as
established pursuant to Section 12-36-1110."
SECTION 10. A. Chapter 10, Title 4 of the 1976 Code is
repealed.
B. Subject to Part I of this act, this section takes effect July 1,
1996.
PART III
Tax Relief
SECTION 1. A. Article 3, Chapter 37, Title 12 of the 1976
Code is amended by adding:
"Section 12-37-257. (A) In addition to any other
homestead exemption allowed by law, one hundred percent of the
fair market value of every homestead qualifying for the assessment
ratio provided pursuant to Section 12-43-220(c) is exempt from all
ad valorem taxes except ad valorem taxes levied for debt service
and for payments pursuant to lease-purchase agreements for school
construction and renovation.
(B) In addition to any other homestead exemption allowed by
law, there is exempt from ad valorem taxes levied for debt service
and payments pursuant to lease-purchase agreements an amount of
the fair market value of residential real property assessed pursuant
to Section 12-37-220(c) equal to increases in such value resulting
from reassessments occurring while the current owner has owned
the property. This exemption does not extend to increases in fair
market value attributable to permanent improvements. For purposes
of this exemption, the acquisition of residential property assessed
pursuant to Section 12-43-220(c) by interspousal gift or by a
surviving spouse by devise or operation of law is not considered a
change of ownership."
B. Subject to Part I of this act, Section 12-37-257(A) of the
1976 Code, as added by this section, is effective for property tax
years beginning after 1995. Section 12-37-257(B) of the 1976
Code, as added by this section, is effective for increases in fair
market value occurring for tax years beginning after 1995.
SECTION 2. The penultimate paragraph of Section 12-37-930
of the 1976 Code is amended to read:
"In no event should The original cost must
not be reduced more than eighty percent the
percentage provided in the following schedule:
Property Tax Year Percentage
Before 1996 80
1996 82
1997 84
1998 86
1999 88
After 1999 90.
In the year of acquisition, depreciation shall be is
allowed as if the property were owned for the full year. The term
`original cost' shall mean means gross capitalized
cost as shown by the taxpayer's records for income tax
purposes."
SECTION 3. A. Section 12-7-435 of the 1976 Code, as last
amended by Act 497 of 1994, is further amended by adding an
appropriately lettered item at the end to read:
"( ) Twenty-eight and one-half percent of amounts
otherwise subject to tax under Section 12-7-210 received by or
attributed to a taxpayer as a result of the taxpayer's status as a:
(1) shareholder of a subchapter `S' corporation;
(2) partner in a partnership; or
(3) member of a limited liability company.
No deduction is allowed under this item for a guaranteed
payment to a partner for personal services rendered by the partner
for the partnership."
B. This section is effective for taxable years beginning after
1994.
SECTION 4. Chapter 29, Title 4 of the 1976 Code is amended
by adding:
"Section 4-29-72. For agreements executed after June 30,
1996, the provisions of Section 4-29-67 apply regardless of the
amount of the project investment."
SECTION 5. Section 4-29-10(3) of the 1976 Code is amended
to read:
"(3) `Project' means any land and any buildings and other
improvements on the land including, without limiting the generality
of the foregoing, water, sewage treatment and disposal facilities, air
pollution control facilities, and all other machinery, apparatus,
equipment, office facilities, and furnishing which are considered
necessary, suitable, or useful by the following or any combination
thereof: (a) any enterprise for the manufacturing, processing, or
assembling of any agricultural or manufactured products and
facilities for an enterprise engaged in the sale or distribution to the
public of electricity, gas, or telephone services; (b) any
commercial enterprise engaged in storing, warehousing, distributing,
transporting, or selling products of agriculture, mining, or industry,
or engaged in providing laundry services to hospitals, to
convalescent homes, or to medical treatment facilities of any type,
public or private, within or outside of the issuing county or
incorporated municipality and within or outside of the State; (c) any
enterprise for research in connection with any of the foregoing or
for the purpose of developing new products or new processes or
improving existing products or processes; (d) any enterprise
engaged in commercial business including, but not limited to,
wholesale, retail, or other mercantile establishments; office
buildings; computer centers; tourism, sports, and recreational
facilities; convention and trade show facilities; and public lodging
and restaurant facilities if the primary purpose is to provide service
in connection with another facility qualifying under this subitem;
and (e) any enlargement, improvement, or expansion of any existing
facility in subitems (a), (b), (c), and (d) of this item. The term
`project' does not include facilities for an enterprise primarily
engaged in the sale or distribution to the public of electricity, gas,
or telephone services. A project may be located in one or more
counties or incorporated municipalities. The term `project' also
includes any structure, building, machinery, system, land, interest
in land, water right, or other property necessary or desirable to
provide facilities to be owned and operated by any person, firm, or
corporation for the purpose of providing drinking water, water, or
wastewater treatment services or facilities to any public body,
agency, political subdivision, or special purpose district."
SECTION 6. A. Notwithstanding the rates of the soft drink
license tax imposed pursuant to Article 13, Chapter 21, Title 12 of
the 1976 Code, the license tax due from a taxpayer pursuant to that
article is reduced by one-third for returns due during fiscal year
1996-97 and by two-thirds for returns due during fiscal year
1997-98.
B. Article 13, Chapter 21, Title 12 of the 1976 Code is
repealed effective July 1, 1998.
SECTION 7. A. Section 12-36-2120 of the 1976 Code is
amended by adding an appropriately numbered item at the end to
read:
"( ) Effective July 1, 1998, food items eligible for
purchase with United States Department of Agriculture food
coupons, not including restaurant meals."
B. Notwithstanding the rates of tax imposed pursuant to
Chapter 36, Title 12 of the 1976 Code, the rate of tax imposed
pursuant to that chapter on the gross proceeds of sales, or the sale
price of food items eligible for purchase with United States
Department of Agriculture food coupons, not including restaurant
meals, is three percent for sales or consumption in fiscal year
1996-97 and one percent for such sales or consumption in fiscal
year 1997-98. Eighty percent of the revenues from sales taxes
imposed by this section must be credited to the general fund of this
State and the remainder must be credited to the Education
Improvement Act Fund.
PART IV
Administration
SECTION 1. A. Section 12-4-310 of the 1976 Code, as last
amended by Act 361 of 1992, is further amended by adding at the
end:
"(11) collect taxes on properties assessed by the
department as provided in Section 12-4-540 except for business
personal property. The department shall distribute property taxes
collected pursuant to this item daily by electronic transfer to county
treasurers for the credit of the taxing entities in the county."
B. The amendment to Section 12-4-310 of the 1976 Code as
contained in this section is effective for taxes due for tax years
beginning after 1995.
SECTION 2. A. Section 12-4-540(A) of the 1976 Code is
amended to read:
"(A) The commission department has the
sole responsibility for the appraisal, assessment, and equalization of
the taxable values of corporate headquarters, corporate office
facilities, and distribution facilities and of the real and personal
property owned, used, or leased by the following businesses in the
conduct of their business:
(1) manufacturing;
(2) railway;
(3) private carline;
(4) airline;
(5) water, heat, light and power;
(6) telephone;
(7) cable television;
(8) sewer;
(9) pipeline;
(10) mining.
In addition, the commission department has the
sole responsibility for the appraisal, assessment, and equalization of
the taxable values of the business personal
property of merchants."
B. The amendment to Section 12-4-310 of the 1976 Code as
contained in this section is effective for tax years beginning after
1995.
SECTION 3. A. Section 12-37-970 of the 1976 Code, as last
amended by Act 181 of 1993, is further amended to read:
"Section 12-37-970. The assessment for property taxation
of merchants' inventories, equipment, furniture, and
fixtures, and manufacturers' real and tangible personal property, and
the machinery, equipment, furniture, and fixtures of all
other taxpayers required to file returns with the South Carolina
Department of Revenue and Taxation for purposes of assessment
for property taxation, must be determined by the department from
property tax returns submitted by the taxpayers to the department
on or before the due date for the taxpayer's state income return,
including any extension last day of the fourth month after
the close of the accounting period regularly employed by the
taxpayer for income tax purposes in accordance with Chapter 7 of
this title. The department by regulation shall prescribe
the form of return required by this section, the information to be
contained in it, and the manner in which the returns must be
submitted and shall provide a method of filing this return as a
part of the taxpayer's state income tax return. Every taxpayer
required to make return to the department of property for
assessment for property taxation must make the return to the
department not less than once each calendar year. Whenever by a
change of accounting period, or otherwise, more than one
accounting period ends within any one calendar year, the taxpayer
must make one such return within the prescribed time for filing
following the end of each of the accounting periods and the
department shall determine the assessment from the return setting
forth the greatest value.
When property required to be returned as herein provided is sold
after the end of the seller's accounting year and before January first
next ensuing and when the purchaser's accounting year ends after
the seller's and before January first next ensuing, the property must
be returned by the seller as of the end of his accounting period.
The purchaser is not required to list and return the property as of
the close of his accounting period during the calendar year of sale.
The seller and the purchaser are jointly and singularly liable for the
tax that is due and payable by reason of this provision. The
provision of this section does not apply to motor vehicles licensed
for use on public highways.
When property required to be returned as provided in this section
is sold before the end of the seller's accounting year and before
January first next ensuing and when the purchaser's accounting year
ends before the date of purchase and before January first next
ensuing, the property must be listed and returned by the taxpayer
holding title as of December thirty-first and is liable for the tax for
the ensuing year.
The Department of Revenue and Taxation shall forward the
assessments prepared as a result of the returns submitted pursuant to
this section for business personal property to the
appropriate local taxing authorities no later than August fifteenth
of the applicable tax year."
B. Section 12-37-905 of the 1976 Code is repealed.
C. This section is effective for property tax years beginning
after 1995.
SECTION 4. A. Section 12-43-250 of the 1976 Code is
amended to read:
"Section 12-43-250. The Commission shall make sales
ratio studies in all counties of the State and when, in the judgment
of the Commission, a county needs to reassess or remap property,
the Commission shall make application to the circuit court in which
the county is located for a determination of whether or not the
county shall be required to commence reassessment or remapping.
If the circuit court determines that the county needs reassessment or
remapping, such county shall be required to commence the
reassessment or remapping within thirty days of such
determination. All taxable real property in a county must
be appraised and equalized once every third year beginning with the
1996 property tax year. Upon completion of a reassessment and
equalization program, property taxpayers must be notified of any
resulting change in value or classification. The values determined
by the program first apply for the property tax year beginning after
the completion of the program and notification of
taxpayers."
B. The Department of Revenue and Taxation shall establish a
schedule of initial reassessments for all counties in conformity with
the provisions of Section 12-43-250 of the 1976 Code as amended
by this section.
SECTION 5. A. Section 12-43-300 of the 1976 Code, as last
amended by Act 181 of 1993, is further amended to read:
"Section 12-43-300. (A) Whenever the market value
estimate of any property is fixed by the assessor
assessing authority at a sum greater by one thousand
dollars or more than the amount returned by the owner or his agent,
or whenever any property is valued and assessed for taxation which
has not been returned or assessed previously, the assessor
assessing authority shall, on or before July first, or as soon
thereafter as may be practicable, in the year in which the valuation
and assessment is made give written notice thereof to the owner of
the property or his agent. In reassessment years, the written
reassessment notice to owners or agents must be given by July first.
If there is no timely written notice, the prior current
year's assessed value must be the basis for assessment for the
current succeeding taxable year. The notice must
include the prior market value, the total market value estimate, the
value estimate if applicable, the assessment ratio, the total new
assessment, the percentage changes over the prior market value, if
there is no change in use or physical characteristics of the property,
number of acres or lots, location of property, tax map, appeal
procedure, and other pertinent ownership and legal description data
required by the South Carolina Department of Revenue and
Taxation. The notice may be served upon the owner or his agent
personally or by mailing it to the owner or his agent at his last
known place of residence which may be determined from the most
recent listing in the applicable telephone directory, Department of
Revenue and Taxation Motor Vehicle Registration List, county
treasurer's records, or official notice from the property owner or his
agent. The owner or his agent, if he objects to the valuation and
assessment, shall serve written notice of his objection upon the
assessor assessing authority within thirty days of the
date of the mailing of the notice. In years when there is no notice
of appraisal because of a less than one thousand dollar change or no
change in the appraised or assessed value, the owner or agent has
until March first to serve written notice of objection upon the
assessor assessing authority of the appraised or
assessed value. In those years, failure to serve written notice of
objection by March first constitutes a waiver of the owner's right of
appeal for that tax year and the assessor assessing
authority is not required to review any request filed after
March first. The assessor assessing authority shall
then schedule a conference with the owner or agent within twenty
days of receipt of the notice. If the assessor assessing
authority requests it, the owner, within thirty days after the
conference, shall complete and return to the assessor
assessing authority the form as may be approved by the
Department of Revenue and Taxation relating to the owner's
property and the reasons for his objection. Within thirty days after
the conference, or as soon thereafter as practicable, the
assessor assessing authority shall mail written notice
of his action upon the objection to the owner. The owner or agent,
if still aggrieved by the valuation and assessment, may appeal from
the action to the Board of Assessment Appeals a
department hearing officer by giving written notice of the
appeal and the grounds thereof to the assessor assessing
authority within thirty days from the date of the mailing of the
notice. The assessor assessing authority shall notify
promptly the Board of Assessment Appeals hearing
officer of the appeal, who shall schedule a hearing on the
appeal within thirty days after notice from the assessing authority
and notify the taxpayer of the hearing date and furnish the taxpayer
a summary of the applicable procedures for the hearing.
(B) The governing body of the county may by ordinance extend
the time for filing an objection to the valuation and assessment of
real property resulting from reassessment within a county.
(C) The Department of Revenue and Taxation shall prescribe a
standard reassessment form designed to contain the information
required in subsection (A) in a manner that may be understood
easily.
(D) At the hearing provided in subsection (A), the hearing
officer shall consider the issues raised by the taxpayer and the
assessing authority and subsequently shall make a determination
which is binding on both parties. The department shall prescribe
the procedure applicable to these hearings which shall require
information from both parties sufficient for the hearing officer to
make an appropriate determination. These hearings must be
conducted informally. Any party aggrieved by the determination of
the hearing officer may appeal the decision to the Administrative
Law Judge Division in the manner prescribed by law which shall
hear the matter de novo as a contested case pursuant to Chapter 23
of Title 1. Notwithstanding the provisions of this section, a
taxpayer aggrieved by the determination of the assessing authority
whose property is assessed pursuant to Section 12-43-220(a) or who
objects to the classification imposed by that section may waive the
hearing before the hearing officer and appeal directly to the
Administrative Law Judge Division for a de novo hearing of the
appeal.
(E) The department shall provide sufficient hearing officers to
hear all appeals expeditiously."
B. The amendment to Section 12-37-300 of the 1976 Code
contained in this section applies to appeals for taxes filed for tax
years after 1995.
SECTION 6. A. Article 5, Chapter 4, Title 12 of the 1976
Code is amended by adding:
"Section 12-4-580. The governing body of a county may
by ordinance transfer to the department the responsibility for the
appraisal, assessment, and equalization of the taxable real property
under the jurisdiction of the county assessor. When this transfer
occurs, the department shall perform the functions of the county
assessor in that county. Before this transfer occurs, the county
governing body and the department shall agree to the employees,
duties, functions, and other related items to be transferred to the
department. Upon agreement, and with the approval of the State
Budget and Control Board, the transfer allowed under this section
occurs on the first day of July following approval by the board if
sufficient funds are appropriated to the department to meet the
additional expenses. The State Budget and Control Board shall
conduct a study to determine the expenses of the department in the
transfer of functions and personnel authorized by this section and
shall make recommendations to the General Assembly of the
appropriations necessary to meet these expenses."
B. This section takes effect July 1, 1996.
SECTION 7. A. The first paragraph of Section 12-37-90 of
the 1976 Code is amended to read:
"Except as provided in Section 12-4-580, all
counties shall have a full-time assessor, whose responsibility is
appraising and listing all real property, whether exempted or not,
except real property required by law to be assessed by the
commission department and property owned by the
federal government, state government, county government or any of
its political subdivisions which is exempt from property taxation. If
the assessor discovers that any real property required by law to be
assessed by the commission department has been
omitted, he shall notify the commission department
that such property has been omitted and the commission
department shall be is required to appraise
and assess the omitted property."
B. This section takes effect July 1, 1996.
SECTION 8. Section 12-4-320 of the 1976 Code, as last
amended by Act 516 of 1994, is further amended to read:
"Section 12-4-320. The commission
department may:
(1) make rules and promulgate regulations, not inconsistent
with law, to aid in the performance of its duties. The
commission department may prescribe the extent, if
any, to which these rules and regulations must be applied without
retroactive effect;
(2) upon written application, determine the tax effects of
transactions and the tax liability of taxpayers, upon facts furnished
to it, and it may revoke or modify the rulings if the facts should
develop differently later. The commission
department, in its discretion, may publish these rulings.
This publication may be in brief hypothetical form so as to give all
pertinent facts and decisions without violating the provisions of
Section 12-54-240;
(3) compromise any tax, interest, or penalty imposed by this
title or other law assigned to it and may return to the owner, in
whole or in part, any goods seized or confiscated;
(4) enter into a written agreement with a person with regard
to a tax liability. If the agreement is approved by a majority of
the commissioners the department, it is final and
conclusive and the case may not be reopened by administrative or
judicial action or otherwise, except in cases of fraud, malfeasance,
or misrepresentation;
(5) publish its findings and decisions in all controversies
resolved by it. This publication may be in brief hypothetical form
so as to give all pertinent facts, decisions, and reasons without
violating the provisions of Section 12-54-240.;
(6) if damage by natural forces occurs as defined in Section
12-9-310, prescribe temporary rules including, but not limited to,
the filing of returns, payment of taxes, and extensions of due
dates.;
(7) waive the retroactive assessment of a state tax when
it determines the taxpayer acted in good faith, and that there were
reasonable grounds for the taxpayer's interpretation of the
applicable law."
SECTION 9. A. Section 12-54-160 of the 1976 Code is
amended to read:
"Section 12-54-160. The Commission
department, unless prohibited within a specific section, may
waive, dismiss, or reduce penalties provided for in this
chapter;. Interest may not be waived, dismissed, or
reduced except:
(1) when the taxpayer can establish that he followed
professional advice which has proved inaccurate; or
(2) if the taxpayer can by clear and convincing evidence
establish he did not know he was liable for the tax; or
(3) the imposition of the tax is a result of regulation or other
interpretation of existing tax laws."
B. This section takes effect upon approval by the Governor and
applies with respect to interest on underpayments of state taxes
assessed on and after that date. The provisions of subsection A. of
this section also apply to interest paid or accrued in the three years
preceding the effective date of this section, but no refund of interest
already paid may be made except upon application therefor to the
Department of Revenue and Taxation within ninety days of the
effective date of this section.
SECTION 10. A. The 1976 Code is amended by adding:
"Section 6-1-60. (A) The counties, municipalities, and
special purpose or public service districts must provide notice to the
public by advertising the public hearing before the adoption of its
budget for the next fiscal year in the nonclassified section of the
largest general circulation newspaper in the area. The public
hearing must give the residents of this governing body the
opportunity to express their concerns and to provide ideas or input
for discussion by the local governing entity. This notice must be
given fourteen days in advance of the public hearing, and must be a
minimum of two columns by ten inches (four and one-half by ten
inches) with at least a twenty-four point headline.
(B) The notice shall include the following:
(1) the governing entity's name;
(2) the time, date, and location of the public hearing on the
budget;
(3) the total, actual, and projected expenditures of the current
operating fiscal year in the budget of the governing entity;
(4) the proposed total projected operating expenditures for the
next fiscal year as proposed in next year's budget for the governing
entity;
(5) the proposed or estimated percentage change in operating
budgets between the current fiscal year and the proposed budget;
(6) the total, actual, and projected revenue of all property
taxes in dollars for the current fiscal year budget;
(7) the proposed total projected revenue of all property taxes
in dollars for the proposed budget;
(8) the millage in current year dollars for the current fiscal
year;
(9) the proposed millage in dollars as proposed in the budget
for the next fiscal year; and
(10) any new fees or taxes that would affect more than five
percent of the total proposed budget.
(C) The requirements of this section apply in the preparation of
annual budget and supplemental appropriations. When the counties,
municipalities, and special purpose or public service districts
determine that it requires a greater tax rate after the adoption of the
budget or during the current fiscal year, or fails to provide notice
within the above-specified period, it must also comply with the
notice provisions of this section."
B. This section is effective for fiscal years beginning after June
30, 1995.
PART V
Effective Date
SECTION 1. The following provisions of this act take effect
upon approval by the Governor or as otherwise provided:
Part I,
Part II, Section 6 and Section 7(N) and (O)
Part III, Section 3
Part IV.
The remaining provisions of this act take effect July 1, 1996, or as
otherwise provided but only upon the certification of the State
Election Commission to the Code Commissioner and the
Department of Revenue and Taxation of a majority
"yes" vote in the referendum provided by this act.
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