ARTICLE 23 SUBSTITUTE A AS AMENDED
RELATING TO
MOTOR VEHICLE REIMBURSEMENTS
SECTION 1. Section 44-34.1-2 of the General Laws in Chapter 44-34.1
entitled “Motor
Vehicle and Trailer Excise
Tax Elimination Act of 1998” is hereby amended to read as follows:
44-34.1-2.
City and town and fire district reimbursement. -- (a) In fiscal
years 2000 and thereafter, cities and towns and fire
districts shall receive reimbursements, as set
forth in this section, from state general revenues equal to
the amount of lost tax revenue due to
the phase out or reduction of the excise tax. Cities and
towns and fire districts shall receive
advance reimbursements through state fiscal year 2002. In the
event the tax is phased out, cities
and towns and fire districts shall receive a permanent
distribution of sales tax revenue pursuant to
section 44-18-18 in an amount equal to any lost revenue
resulting from the excise tax elimination.
Lost revenues must be determined using a base tax rate
fixed at fiscal year 1998 levels for each
city, town, and fire district, except that the Town of
fiscal year 1999 level.
(b) (1) The director of administration shall determine the amount of
general revenues to
be distributed to each city and town and fire district
for the fiscal years 1999 and thereafter so that
every city and town and fire district is held harmless from
tax loss resulting from this chapter,
assuming that tax rates are indexed to inflation through
fiscal year 2003.
(2) The director of
administration shall index the tax rates for inflation by applying the
annual change in the December Consumer Price Index -- All
Urban Consumers (CPI-U),
published by the Bureau of Labor Statistics of the United
States Department of Labor, to the
indexed tax rate used for the prior fiscal year calculation;
provided, that for state reimbursements
in fiscal years 2004 and thereafter, the indexed tax
rate shall not be subject to further CPI-U
adjustments. The director shall apply the following principles in
determining reimbursements:
(i)
Exemptions granted by cities and towns and fire districts in the fiscal year
1998 must
be applied to assessed values prior to applying the
exemptions in section 44-34.1-1(c)(1). Cities
and towns and fire districts will not be reimbursed for
these exemptions.
(ii) City, town, and
fire districts shall be reimbursed by the state for revenue losses
attributable to the exemptions provided for in section 44-34.1-1
and the inflation indexing of tax
rates through fiscal 2003. Reimbursement for revenue losses
shall be calculated based upon the
difference between the maximum taxable value less personal
exemptions and the net assessed
value.
(iii) Inflation
reimbursements shall be the difference between:
(A) The levy calculated
at the tax rate used by each city and town and fire district for
fiscal year 1998 after adjustments for personal exemptions
but prior to adjustments for
exemptions contained in section 44-34.1-1(c)(1); provided, that
for the town of
rate used for fiscal year 1999 must be used for the
calculation; and
(B) The levy calculated
by applying the appropriate cumulative inflation adjustment
through state fiscal 2003 to the tax rate used by each city
and town and fire district for fiscal year
1998; provided, that for the town of
for the calculation after adjustments for personal
exemptions but prior to adjustments for
exemptions contained in section 44-34.1-1.
(c) (1) Funds shall be
distributed to the cities and towns and fire districts as follows:
(i)
On October 20, 1998, and each October 20 thereafter through October 20, 2001,
twenty-five percent (25%) of the amount calculated by the
director of administration to be the
difference for the upcoming fiscal year.
(ii) On February 20,
1999, and each February 20 thereafter through February 20, 2002,
twenty-five percent (25%) of the amount calculated by the
director of administration to be the
difference for the upcoming fiscal year.
(iii) On June 20, 1999,
and each June 20 thereafter through June 20, 2002, fifty percent
(50%) of the amount calculated by the director of
administration to be the difference for the
upcoming fiscal year.
(iv)
On August 1, 2002, and each August 1 thereafter, twenty-five percent
(25%) of the
amount calculated by the director of administration to be
the difference for the current fiscal year.
(v) On November 1,
2002, and each November 1 thereafter, twenty-five percent (25%)
of the amount calculated by the director of
administration to be the difference for the current
fiscal year.
(vi)
On February 1, 2003, and each February 1 thereafter, twenty-five percent
(25%) of
the amount calculated by the director of administration
to be the difference for the current fiscal
year.
(vii) On May 1, 2003,
and each May 1 thereafter, except May 1, 2010, twenty-five
percent (25%) of the amount calculated by the director of
administration to be the difference for
the current fiscal year.
(viii) On June 15, 2010,
twenty-five percent (25%) of the amount calculated by the
director of administration to be the difference for the
current fiscal year.
Provided, however, the
February and May payments, and June payment in 2010, shall be
subject to submission of final certified and reconciled motor
vehicle levy information.
(2) Each city, town, or
fire district shall submit final certified and reconciled motor
vehicle levy information by August 30 of each year. Any
adjustment to the estimated amounts
paid in the previous fiscal year shall be included or
deducted from the payment due November 1.
(3) On any of the
payment dates specified in paragraphs (1)(i) through (vii) of this
subsection, the director is authorized to deduct previously made
over-payments or add
supplemental payments as may be required to bring the
reimbursements into full compliance with
the requirements of this chapter.
(4) For the city of
on February 20, 1999, and each February 20 thereafter
through February 20, 2002, twenty-five
percent (25%) on June 20, 1999, and each June 20 thereafter
through June 20, 2002, which
includes final reconciliation of the previous year's payment,
and fifty percent (50%) on October
20, 1999, and each October 20
thereafter through October 20, 2002.
For local fiscal years 2003
and thereafter, the payment schedule is twenty-five
percent (25%) on each November 1, twenty-
five percent (25%) on each February 1, twenty-five percent
(25%) on each May 1, which includes
final reconciliation of the previous year's payment, and
twenty-five percent (25%) on each
August 1; provided, the May and August payments shall
be subject to submission of final
certified and reconciled motor vehicle levy information.
(5) When the tax is
phased out, funds distributed to the cities, towns, and fire districts for
the following fiscal year shall be calculated as the
funds distributed in the fiscal year of the phase-
out. Twenty-five percent (25%) of the amounts calculated
shall be distributed to the cities and
towns and fire districts on August 1, in the fiscal year of
the phase-out, twenty-five percent (25%)
on the following November 1, twenty-five percent (25%)
on the following February 1, and
twenty-five percent (25%) on the following May 1. The funds
shall be distributed to each city and
town and fire district in the same proportion as
distributed in the fiscal year of the phase-out.
(6) When the tax is
phased out to August 1, of the following fiscal year the director of
administration shall calculate to the nearest tenth of one cent
($.001) the number of cents of sales
tax received for the fiscal year ending June 30, of the
year following the phase-out equal to the
amount of funds distributed to the cities, towns, and fire
districts under this chapter during the
fiscal year following the phase-out and the percent of the
total funds distributed in the fiscal year
following the phase-out received by each city, town, and fire
district, calculated to the nearest
one-hundredth of one percent (0.01%). The director of the
department of administration shall
transmit those calculations to the governor, the speaker of
the house, the president of the senate,
the chairperson of the house finance committee, the
chairperson of the senate finance committee,
the house fiscal advisor, and the senate fiscal advisor.
The number of cents, applied to the sales
taxes received for the prior fiscal year, shall be the
basis for determining the amount of sales tax
to be distributed to the cities and towns and fire
districts under this chapter for second fiscal year
following the phase-out and each year thereafter. The cities
and towns and fire districts shall
receive that amount of sales tax in the proportions
calculated by the director of administration as
that received in the fiscal year following the phase-out.
(7) When the tax is
phased out, twenty-five percent (25%) of the funds shall be
distributed to the cities, towns, and fire districts on August 1,
of the following fiscal year and
every August 1 thereafter; twenty-five percent (25%) shall
be distributed on the following
November 1, and every November 1 thereafter;
twenty-five percent (25%) shall be distributed on
the following February 1, and every February 1
thereafter; and twenty-five percent (25%) shall be
distributed on the following May 1, and every May 1 thereafter.
(8) For the city of
(25%) shall be distributed on November 1, of the
following fiscal year and every November 1
thereafter, twenty-five percent (25%) shall be distributed on
the following February 1, and every
February 1 thereafter; twenty-five percent (25%) shall
be distributed on the following May 1, and
every May 1 thereafter; and twenty-five percent (25%) of
the funds shall be distributed on the
following August 1, and every August 1 thereafter.
(9) As provided for in
section 44-34-6, the authority of fire districts to tax motor vehicles
is eliminated effective with the year 2000 tax roll and
the state reimbursement for fire districts
shall be based on the provisions of section 44-34-6. All
references to fire districts in this chapter
do not apply to the year 2001 tax roll and thereafter.
(10) For reimbursements
payable in the year ending June 30, 2008 and thereafter, the
director of administration shall discount the calculated value
of the exemption to ninety-eight
percent (98%) in order to establish a collection rate that is
comparable to the collection rate
achieved by municipalities in the levy of the motor vehicle
excise tax.
(11) For reimbursements
payable in the year ending June 30, 2010, the director of
administration shall reimburse cities and towns eighty-eight percent
(88%) of the reimbursements
payable pursuant to subdivision (c)(10) above.
(12) For fiscal year 2011
and thereafter, the state shall reimburse cities and towns for the
exemption pursuant to subdivision (c)(10) above, ratably
reduced to the appropriation.
SECTION 2. Section 44-34.1-1 of the General Laws in Chapter
44-34.1 entitled "Motor
Vehicle and Trailer Excise
Tax Elimination Act of 1998" is hereby amended to read as follows:
44-34.1-1.
Excise tax phase-out. -- (a) (1) Notwithstanding the provisions of chapter 34
of this title or any other provisions to the contrary,
the motor vehicle and trailer excise tax
established by section 44-34-1 may be phased out. The phase-out
shall apply to all motor vehicles
and trailers, including leased vehicles.
(2) Lessors
of vehicles that pay excise taxes directly to municipalities shall provide
lessees, at the time of entering into the lease agreement, an
estimate of annual excise taxes
payable throughout the term of the lease. In the event the
actual excise tax is less than the
estimated excise tax, the lessor
shall annually rebate to the lessee the difference between the
actual excise tax and the estimated excise tax.
(b) Pursuant to the
provisions of this section, all motor vehicles shall be assessed a value
by the vehicle value commission. That value shall be
assessed according to the provisions of
section 44-34-11(c)(1) and in accordance with the terms as
defined in subsection (d) of this
section; provided, however, that the maximum taxable value
percentage applicable to model year
values as of December 31, 1997, shall continue to be
applicable in future year valuations aged by
one year in each succeeding year.
(c) (1) The motor vehicle excise tax phase-out shall commence with
the excise tax bills
mailed to taxpayers for the fiscal year 2000. The phase-out,
beyond fiscal year 2003, shall be
subject to annual review and appropriation by the general
assembly. The tax assessors of the
various cities and towns and fire districts shall reduce the
average retail value of each vehicle
assessed by using the prorated exemptions from the following
table:
Local Fiscal Year State
fiscal year
Exempt from value Local Exemption Reimbursement
fiscal
year 1999 0 $1,500
fiscal
year 2000 $1,500 $2,500
fiscal
year 2001 $2,500 $3,500
fiscal
year 2002 $3,500 $4,500
fiscal years 2003, 2004
and
2005 $4,500 $4,500
for
fiscal year 2006 and $5,000 $5,000
for
fiscal year 2007 $6,000 $6,000
for
fiscal year years 2008, 2009 and 2010 and each year
thereafter the exemption and the
state fiscal year reimbursement shall be increased, at a
minimum, to the maximum amount to the
nearest two hundred and fifty dollar ($250) increment within
the allocation of one and twenty-two
hundredths percent (l.22%) of net terminal income derived from
video lottery games pursuant to
the provisions of section 42-61-15, and in no event shall
the exemption in any fiscal year be less
than the prior fiscal year.
for
fiscal year 2011 and thereafter, the exemption shall be five hundred dollars
($500).
Cities and towns may provide an additional exemption
of five thousand five hundred dollars
($5,500) or more; provided, however, any such
additional exemption shall not be subject to
reimbursement.
(2) The excise tax
phase-out shall provide levels of assessed value reductions until the tax
is eliminated or reduced as provided in this chapter.
(3) Current exemptions
shall remain in effect as provided in this chapter.
(4) The excise tax rates
and ratios of assessment shall be maintained at a level identical to
the level in effect for fiscal year 1998 for each city,
town, and fire district; provided, in the town
of
the level in effect for fiscal year 1999 levels and in
no event shall the final taxable value of a
vehicle be higher than assessed in the prior fiscal year, and the levy of a city, town, or fire district
shall be limited to the lesser of the maximum taxable value
or net assessed value for purposes of
collecting the tax in any given year.
(d) Definitions.
(1) "Maximum
taxable value" means the value of vehicles as prescribed by section 44-34-
11 reduced by the percentage of assessed value
applicable to model year values as determined by
the
the commission as of December 31, 1997. For all vehicle
value types not valued by the Rhode
Island vehicle value commission as of December 31,
1997, the maximum taxable value shall be
the latest value determined by a local assessor from an
appropriate pricing guide, multiplied by
the ratio of assessment used by that city, town, or fire
district for a particular model year as of
December 31, 1997.
(2) "Net assessed
value" means the motor vehicle values as determined in accordance
with section 44-34-11 less all personal exemptions allowed
by cities, towns, fire districts, and the
state of
(e) If any provision of
this chapter shall be held invalid by any court of competent
jurisdiction, the remainder of this chapter and the applications
of the provisions hereof shall not
be effected thereby.
SECTION 3. Section 44-34-6 of the General Laws in Chapter
44-34 entitled "Excise on
Motor Vehicles and
Trailers" is hereby amended to read as follows:
44-34-6.
Fire districts. -- The provisions of this chapter
shall apply in all respects in the
case of taxes assessed upon motor vehicles by any fire
district. Effective with the year 2000 tax
roll based upon values of December 31, 1999, the authority
of fire districts as authorized by
general or public law to levy excise taxes on motor vehicles
is eliminated and each district shall
be reimbursed for one hundred percent (100%) of current
year lost revenues through fiscal year
2010 based upon
what the levy net of personal exemptions would otherwise have been. That
reimbursement shall be based upon submission of information to the
department of revenue on
the dates specified in section 44-34.1-2, and
reimbursements shall be paid on the dates specified
in that section. Future year reimbursements through
fiscal year 2010 shall be based upon the year
2000 tax roll and values of December 31, 1999, and
indexed by applying the annual change in the
December Consumer Price Index -- All
Urban Consumers (CPI-U). For
fiscal year 2011 and
thereafter the state shall not reimburse fire districts pursuant
to this chapter.
SECTION 4. This article shall take effect upon passage.