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AB-561 Sales and use taxes: exclusion: public safety first responder vehicle and equipment: local public employee retirement: employer contributions. (2017-2018)

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Date Published: 03/20/2017 09:00 PM
AB561:v98#DOCUMENT

Amended  IN  Assembly  March 20, 2017

CALIFORNIA LEGISLATURE— 2017–2018 REGULAR SESSION

Assembly Bill No. 561


Introduced by Assembly Member Voepel

February 14, 2017


An act to add Section 7514.9 to the Government Code, and to add Section 6012.4 6012.10 to the Revenue and Taxation Code, relating to local government, and making an appropriation therefor.


LEGISLATIVE COUNSEL'S DIGEST


AB 561, as amended, Voepel. Sales and use taxes: exclusion: public safety first responder vehicle and equipment: local public employee retirement: employer contributions.
(1) Existing sales and use tax laws impose a tax on retailers measured by the gross receipts from the sale of tangible personal property sold at retail in this state, or on the storage, use, or other consumption in this state of tangible personal property purchased from a retailer for storage, use, or other consumption in this state, measured by sales price. The Sales and Use Tax Law defines the terms “gross receipts” and “sales price.”
This bill, for any public safety first responder vehicle and any equipment required on a public safety first responder vehicle that is purchased by a local public agency, would exclude from the terms “gross receipts” and “sales price,” amounts of the gross receipts or sales price in excess of $300,000.
This bill would require a local public agency that purchases a public safety first responder vehicle or any equipment required on a public safety first responder vehicle subject to this partial exclusion to calculate, as specified, the total amount of sales tax reimbursement to a retailer or use tax that the local public agency would have paid in the absence of the partial exclusion, minus any amounts actually paid, and make an employer contribution to the local public agency’s retirement fund in that amount. The bill would declare that this requirement addresses a matter of statewide concern and would apply equally to all cities and counties in this state, including charter cities and charter counties.
(2) The Public Employees’ Retirement Law establishes the Public Employees’ Retirement System and sets forth the provisions for its administration and delivery of benefits to its members. That law authorizes any public agency, defined to include specified local agencies, to contract with the Board of Administration of the Public Employees’ Retirement System to participate in, and make all or part of its employees members of, that system. That law also establishes the Public Employees’ Retirement Fund and continuously appropriates moneys in the fund for, among other purposes, payments for the benefit of the members of the system and their survivors and beneficiaries. That law requires that employer contributions of the state, school employers, and contracting agencies be credited to the fund.
To the extent that this bill would increase the amount of employer contributions credited to the Public Employees’ Retirement Fund by a local public agency that contracts with the board to participate in the Public Employees’ Retirement System, thereby increasing the amount of money in a continuously appropriated fund, this bill would make an appropriation.
(3) The Bradley-Burns Uniform Local Sales and Use Tax Law authorizes counties and cities to impose local sales and use taxes in conformity with the Sales and Use Tax Law, and existing laws authorize districts, as specified, to impose transactions and use taxes in accordance with the Transactions and Use Tax Law, which generally conforms to the Sales and Use Tax Law. Amendments to the Sales and Use Tax Law are automatically incorporated into the local tax laws.
Existing law requires the state to reimburse cities and counties for revenue losses caused by the enactment of sales and use tax exemptions.
This bill would provide that, notwithstanding these provisions, no appropriation is made and the state shall not reimburse cities and counties for sales and use tax revenues lost by them pursuant to this bill.
Vote: MAJORITY   Appropriation: YES   Fiscal Committee: YES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 Section 7514.9 is added to the Government Code, to read:

7514.9.
 (a) (1) A local public agency that purchases a public safety first responder vehicle or any equipment required on a public safety first responder vehicle, the gross receipts or sales price of which are partially excluded from “gross receipts” or “sales price” for purposes of the Sales and Use Tax Law (Part 1 (commencing with Section 6001) of Division 2 of the Revenue and Taxation Code), pursuant to Section 6012.4 6012.10 of the Revenue and Taxation Code, shall do either of the following, as applicable:
(A) If the sale of the public safety first responder vehicle or equipment is subject to Chapter 2 (commencing with Section 6051) of Part 1 of Division 2 of the Revenue and Taxation Code, the local public agency shall calculate the amount of sales tax reimbursement that the local public agency would have been required to pay the retailer if the amount excluded from gross receipts pursuant to Section 6012.4 6012.10 of the Revenue and Taxation Code had been included in “gross receipts,” as defined in Section 6012 of the Revenue and Taxation Code, and the retailer had sought a sales tax reimbursement pursuant to Section 1656.1 of the Civil Code. The local public agency shall subtract any amount actually paid to the retailer for a sales tax reimbursement.
(B) If the sale of the public safety first responder vehicle or equipment is subject to Chapter 3 (commencing with Section 6201) of Part 1 of Division 2 of the Revenue and Taxation Code, the local public agency shall calculate the amount of tax it would have been required to pay if the amount excluded from sales price pursuant to Section 6012.4 6012.10 of the Revenue and Taxation Code had been included in “sales price,” as defined in Section 6011 of the Revenue and Taxation Code. The local public agency shall subtract any amount actually paid in tax.
(2) The local public agency shall make the same calculations as required by paragraph (1) with respect to any applicable taxes imposed in accordance with the Bradley-Burns Uniform Local Sales and Use Tax Law (Part 1.5 (commencing with Section 7200) of Division 2 of the Revenue and Taxation Code) and the Transactions and Use Tax Law (Part 1.6 (commencing with Section 7251) of Division 2 of the Revenue and Taxation Code).
(3) The local public agency shall add the amounts determined pursuant to paragraphs (1) and (2).
(b) (1)The local public agency shall make an employer contribution to its retirement fund in the amount described in paragraph (3) of subdivision (a) within the same fiscal year as the sale of a public safety first responder vehicle or any equipment required on a public safety first responder vehicle described in paragraph (1) of subdivision (a). Employer contributions made pursuant to this section shall supplement, and shall not supplant, any other employer contributions that the local public agency is otherwise required to make to its retirement fund.
(c) As used in this section, “local public agency” has the same meaning as specified in Section 6012.4 6012.10 of the Revenue and Taxation Code.
(d) The Legislature finds and declares that ensuring the solvency of local public retirement systems is a matter of vital statewide importance. This section shall therefore apply to all cities and counties in this state, including charter cities and charter counties.

SEC. 2.

 Section 6012.4 6012.10 is added to the Revenue and Taxation Code, to read:

6012.4.6012.10.
 (a) (1) For purposes of this part, “gross receipts” and “sales price” shall not include amounts of the gross receipts or sales price in excess of three hundred thousand dollars ($300,000) from the sale in this state of, and the storage, use, or other consumption in this state of, any public safety first responder vehicle purchased by a local public agency.
(2) For purposes of this part, “gross receipts” and “sales price” shall not include amounts of the gross receipts or sales price in excess of three hundred thousand dollars ($300,000) from the sale in this state of, and the storage, use, or other consumption in this state of, any equipment required on a public safety first responder vehicle, that is purchased by a local public agency.
(b) For purposes of this section, “local public agency” means any city, county, municipal corporation, district, or public authority located within this state that provides or may provide first responder emergency services.

SEC. 3.

 Notwithstanding Section 2230 of the Revenue and Taxation Code, no appropriation is made by this act and the state shall not reimburse cities and counties for any sales and use tax revenues lost by them under this act.