SB 497-FN-A-LOCAL - AS INTRODUCED
2016 SESSION
\t16-2703
\t10/01
SENATE BILL\t497-FN-A-LOCAL
AN ACT\trelative to disposition of meals and rooms tax revenues to towns and cities.
SPONSORS:\tSen. Stiles, Dist 24; Sen. Bradley, Dist 3; Sen. Fuller Clark, Dist 21; Sen. Feltes, Dist 15; Sen. Woodburn, Dist 1; Rep. Tholl, Coos 5; Rep. Emerick, Rock. 21; Rep. Gionet, Graf. 5
COMMITTEE:\tWays and Means
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ANALYSIS
\tThis bill requires the department of revenue administration to distribute a portion of meals and rooms tax collected to towns and cities in proportion to the total amount of taxes collected in the state.
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Explanation:\tMatter added to current law appears in bold italics.
\t\tMatter removed from current law appears [in brackets and struckthrough.]
\t\tMatter which is either (a) all new or (b) repealed and reenacted appears in regular type.
\t16-2703
\t10/01
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Sixteen
AN ACT\trelative to disposition of meals and rooms tax revenues to towns and cities.
Be it Enacted by the Senate and House of Representatives in General Court convened:
\t1 New Subparagraph; Department of Revenue Administration; Confidentiality; Exclusions. Amend RSA 21-J:14, IV by inserting after subparagraph (c) the following new subparagraph:
\t\t\t(d) Disclosure of the total amount of revenue collected from the meals and rooms tax in each municipality pursuant to RSA 78-A:19-a.
\t2 New Section; Tax on Meals and Rooms; Disclosure. Amend RSA 78-A by inserting after section 19 the following new section:
\t78-A:19-a Collection and Disclosure of Revenue Information. The department shall collect information about the revenue collected from the meals and rooms tax in each municipality necessary to determine the total amount of meals and rooms tax revenue collected in each municipality. The department shall make its determination of the total amount of meals and room tax revenue collected in a municipality available, upon written request, to the members of the New Hampshire senate and house of representatives representing such municipality, except where such municipality has 10 or fewer operators collecting meals and rooms taxes.
\t3 Meals and Rooms Tax; Distribution. Amend RSA 78-A:26, I and II to read as follows:
\t\tI. Beginning on July 1, 1995, and for each fiscal year thereafter, the department shall pay over all revenue, except revenues identified in paragraph III of this section, collected under this chapter to the state treasurer. On or before September 15 of each year, the department shall determine the cost of administration of this chapter for the fiscal year ending on the preceding June 30, and it shall notify the state treasurer of these costs by a report certified by them as to correctness. After deducting the cost of administration of the chapter from the total income, the state treasurer shall distribute the net income as follows:
\t\t\t(a) The amount necessary to provide payments of principal and interest on the bonds and notes authorized under RSA 198:15-a, II for the fiscal years ending June 30, 2009 through June 30, 2030;
\t\t\t(b) An amount equal to 3.15 percent of the net income distributed under the introductory paragraph of paragraph I and subparagraph I(a) in the first year of the preceding fiscal biennium, which shall be credited to the department of resources and development, division of travel and tourism development;
\t\t\t(c) Forty percent of the net income under the introductory paragraph of paragraph I of the most recent fiscal year to the unincorporated towns, unorganized places, towns, and cities. The amount to be distributed to each such town, place, or city shall be determined by multiplying the amount to be distributed by a fraction, the numerator of which shall be the population of the unincorporated town, unorganized place, town or city and the denominator of which shall be the population of the state. The population figures shall be based on the latest resident population figures furnished by the office of energy and planning; [and]
\t\t\t(d) For any year in which the total net amount to be distributed under subparagraph (c) exceeds the amount including the $5,000,000 increase under paragraph II, an additional amount up to $5,000,000 of the net income under the introductory paragraph of paragraph I of the most recent fiscal year shall be distributed to the unincorporated towns, unorganized places, towns, and cities. The amount to be distributed to each such town, place, or city shall be determined by multiplying the amount to be distributed by a fraction, the numerator of which shall be the amount determined by the department of revenue administration to have been collected by operators in the unincorporated town, unorganized place, town, or city and the denominator of which shall be the total amount of net income under the introductory paragraph of paragraph I of the most recent fiscal year. For purposes of this subparagraph, operators shall report to the department the amount of tax collected within each unincorporated town, unorganized place, town, or city on a form as set forth in rules adopted by the commissioner under RSA 78-A:2, II; and
\t\t\t(e) The remainder to the general fund.
\t\tII. Each fiscal year, the amount to be distributed under subparagraph I(c) shall be equal to the prior year's distribution plus an amount equal to 75 percent of any increase in the income received from the meals and rooms tax for the fiscal year ending on the preceding June 30, not to exceed $5,000,000, until such time as the total amount distributed annually is equal to the amount indicated in subparagraph I(c).
\t4 Meals and Rooms Tax; Collection; Information Required. Amend RSA 78-A:7, II-IV to read as follows:
\t\tII. Each operator shall keep books and records in a form acceptable to the department showing the amount of all taxes collected and the town or city in which such taxes were collected. The operator shall pay the taxes over to the state as provided in this section. If the department believes that special action is necessary because payment of taxes collected may be in jeopardy, it may direct an operator to keep all taxes collected separate from any other funds. The department may require that the taxes be periodically deposited in a bank designated by the department, in an account in the name of the department. The department may withdraw these tax collections from the bank account and apply them to the payment of the taxes due from the operator. When an operator commingles tax money with money belonging to him, the claim of the state for the tax is traceable, is enforceable against all other claims and takes precedence over all other claims against the commingled funds. No taxes collected by an operator under this chapter may be sent outside the state without the written consent of the department.
\t\tIII. To compensate operators for keeping the prescribed records and the proper account and remitting of taxes by them, operators are allowed to retain 3 percent of the taxes due and to be remitted if the return and payment are timely received by the department of revenue administration, as provided in RSA 78-A:8, III.
\t\tIV. In lieu of keeping detailed records of taxes collected, and in lieu of payment of the taxes collected under this chapter, an operator may, in writing, elect to compute the amount of taxes due at 9 percent of the total taxable rent, charge for meals, or gross rental receipts received by it, or both, exclusive of the taxes collected on such rents, charges, and gross rental receipts, provided the operator identifies the percentage of such amounts received within each town or city in which the operator does business. If this election is made, the operator may not change the method of computing taxes without the written consent of the department. Any balance of the tax remaining in possession of the operator may be retained by it.
\t5 Department of Revenue Administration; Rulemaking Required. The commissioner shall adopt by rule pursuant to RSA 541-A new or amended rules and forms as necessary to accommodate the reporting requirements for operators under RSA 78-A:26, I(d).
\t6 Effective Date. This act shall take effect July 1, 2016.
\t\t\t\t\t\t\t\t\t\t\t16-2703
\t\t\t\t\t\t\t\t\t\t\t12/21/15
SB 497-FN-A-LOCAL- FISCAL NOTE
AN ACT\trelative to disposition of meals and rooms tax revenues to towns and cities.
FISCAL IMPACT:
The Department of Revenue Administration states this bill, as introduced, may increase local revenue by an indeterminable amount in FY 2018 and each year thereafter and increase state general fund expenditures by an indeterminable amount in FY 2017 and each year thereafter. There is no impact on county revenue or county and local expenditures.
METHODOLOGY:
The Department of Revenue Administration states this bill amends RSA 78-A:26 by directing the Department to distribute a portion of the meals and rooms tax collected to the towns and cities where collected in proportion to the total amount of taxes collected in the State. This additional disbursement would be an amount up to $5,000,000 above the current $5,000,000 cap provided for in RSA 78-A:26, II. This bill also amends the Department's confidentiality statutes to permit the Department to disclose meals and rooms tax revenue collection in each city and town. The Department states the bill can not be implemented as written; however recognizes the intent of the bill is to provide additional meals and rooms tax revenue to cities and towns. As a result, this bill may increase local revenue and state general fund expenditures by an amount up to $5,000,000 each fiscal year. The Department states it would have increased expenditures associated with modifying existing forms to collect the identification of the city or town where the tax was generated, developing new forms and updating internal processing systems. The Department indicated it would not be able to make the necessary changes to forms and processing systems to allow for the collection of the data necessary to distribute the additional revenue in FY 2017, therefore it is assumed the impact on state and local revenue will not occur until FY 2018.