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H.B. 54
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OLENE WALKER HOUSING TRUST FUND
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AMENDMENTS
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2000 GENERAL SESSION
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STATE OF UTAH
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Sponsor: Wayne A. Harper
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AN ACT RELATING TO COMMUNITY AND ECONOMIC DEVELOPMENT AND TO
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REVENUE AND TAXATION; TEMPORARILY INCREASING THE TAX ON INSURANCE
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PREMIUMS AND ALLOCATING THAT INCREASE TO THE OLENE WALKER HOUSING
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TRUST FUND; AND MAKING TECHNICAL CHANGES.
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This act affects sections of Utah Code Annotated 1953 as follows:
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AMENDS:
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9-4-702, as last amended by Chapter 276, Laws of Utah 1998
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59-9-101, as last amended by Chapter 375, Laws of Utah 1997
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Be it enacted by the Legislature of the state of Utah:
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Section 1.
Section
9-4-702
is amended to read:
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9-4-702. Creation and administration.
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(1) (a) There is created a restricted account in the General Fund known as the Olene
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Walker Housing Trust Fund, administered by the executive director or his designee.
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(b) The department shall be the trustee of the fund.
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(2) There shall be deposited into the fund:
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(a) grants, paybacks, bonuses, entitlements, and other moneys received by the department
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from the federal government to preserve, rehabilitate, build, restore, or renew housing or other
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activities authorized by the fund;
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(b) transfers, grants, gifts, bequests, or any money made available from any source to
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implement this part; [and]
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(c) moneys allocated to the fund under Section
59-9-101
; and
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[(c)] (d) moneys appropriated to the fund by the Legislature.
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(3) The moneys in the fund shall be invested by the state treasurer according to the
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procedures and requirements of Title 51, Chapter 7, State Money Management Act, except that all
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interest or other earnings derived from the fund moneys shall be deposited in the fund.
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Section 2.
Section
59-9-101
is amended to read:
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59-9-101. Tax basis -- Rates -- Exemptions.
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(1) (a) Except for annuity considerations, insurance premiums paid by institutions within
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the state system of higher education as specified in Section
53B-1-102
, and ocean marine
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insurance, every admitted insurer shall pay to the commission on or before March 31 in each year,
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a tax of 2-1/4% of the total premiums received by it during the preceding calendar year from
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insurance covering property or risks located in this state.
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(b) Subsection (1)(a) does not apply to workers' compensation insurance, assessed under
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Subsection (2), and title insurance premiums, taxed under Subsection (3).
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(c) The taxable premium under Subsection (1)(a) shall be reduced by:
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[(a)] (i) all premiums returned or credited to policyholders on direct business subject to
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tax in this state;
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[(b)] (ii) all premiums received for reinsurance of property or risks located in this state;
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and
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[(c)] (iii) the dividends, including premium reduction benefits maturing within the year,
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paid or credited to policyholders in this state or applied in abatement or reduction of premiums due
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during the preceding calendar year.
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(d) (i) Beginning on July 1, 2000, and ending on June 30, 2006, the tax rate for the
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insurance premium tax imposed by Subsection (1)(a) shall be 2-3/4%.
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(ii) The commission shall, on or before June 30 of each year specified in Subsection
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(1)(d)(i), deposit in the Olene Walker Housing Trust Fund, created in Section
9-4-702
, an amount
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equal to the difference between:
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(A) the tax collected under Subsection (1)(d)(i) for that year; and
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(B) an amount equal to the premiums taxed under Subsection (1) multiplied by 2-1/4%.
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(2) (a) Every admitted insurer writing workers' compensation insurance in this state,
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including the Workers' Compensation Fund of Utah under Title 31A, Chapter 33, shall pay to the
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tax commission, on or before March 31 in each year, a premium assessment of between 1% and
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8% of the total workers' compensation premium income received by the insurer from workers'
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compensation insurance in this state during the preceding calendar year.
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(b) Total workers' compensation premium income means the net written premium as
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calculated before any premium reduction for any insured employer's deductible, retention, or
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reimbursement amounts and also those amounts equivalent to premiums as provided in Section
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34A-2-202
.
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(c) The percentage of premium assessment applicable for a calendar year shall be
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determined by the Labor Commission under Subsection (2)(d). The total premium income shall
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be reduced in the same manner as provided in Subsections (1)[(a)](c)(i) and (1)[(b)](c)(ii), but not
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as provided in Subsection (1)(c)(iii). The tax commission shall promptly remit from the premium
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assessment collected under Subsection (2):
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(i) an amount of up to 7.25% of the premium income to the state treasurer for credit to the
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Employers' Reinsurance Fund created under Subsection
34A-2-702
(1);
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(ii) an amount equal to 0.25% of the premium income to the state treasurer for credit to
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the restricted account in the General Fund, created by Section
34A-2-701
; and
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(iii) an amount of up to 0.50% and any remaining assessed percentage of the premium
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income to the state treasurer for credit to the Uninsured Employers' Fund created under Section
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34A-2-704
.
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(d) (i) The Labor Commission shall determine the amount of the premium assessment for
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each year on or before each October 15 of the preceding year. The Labor Commission shall make
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this determination following a public hearing. The determination shall be based upon the
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recommendations of a qualified actuary.
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(ii) The actuary shall recommend a premium assessment rate sufficient to provide
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payments of benefits and expenses from the Employers' Reinsurance Fund and to project a funded
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condition with assets greater than liabilities by no later than June 30, 2025.
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(iii) The actuary shall recommend a premium assessment rate sufficient to provide
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payments of benefits and expenses from the Uninsured Employers' Fund and to maintain it at a
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funded condition with assets equal to or greater than liabilities.
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(iv) At the end of each fiscal year the minimum approximate assets in the Employers'
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Reinsurance Fund shall be $5,000,000 which amount shall be adjusted each year beginning in 1990
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by multiplying by the ratio that the total workers' compensation premium income for the preceding
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calendar year bears to the total workers' compensation premium income for the calendar year 1988.
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(v) The requirements of Subsection (2)(d)(iv) cease when the future annual disbursements
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from the Employers' Reinsurance Fund are projected to be less than the calculations of the
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corresponding future minimum required assets. The Labor Commission shall, after a public
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hearing, determine if the future annual disbursements are less than the corresponding future
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minimum required assets from projections provided by the actuary.
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(vi) At the end of each fiscal year the minimum approximate assets in the Uninsured
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Employers' Fund shall be $2,000,000, which amount shall be adjusted each year beginning in 1990
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by multiplying by the ratio that the total workers' compensation premium income for the preceding
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calendar year bears to the total workers' compensation premium income for the calendar year 1988.
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(e) A premium assessment that is to be transferred into the General Fund may be collected
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on premiums received from Utah public agencies.
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(3) Every admitted insurer writing title insurance in this state shall pay to the commission,
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on or before March 31 in each year, a tax of .45% of the total premium received by either the
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insurer or by its agents during the preceding calendar year from title insurance concerning property
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located in this state. In calculating this tax, "premium" includes the charges made to an insured
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under or to an applicant for a policy or contract of title insurance for:
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(a) the assumption by the title insurer of the risks assumed by the issuance of the policy
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or contract of title insurance; and
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(b) abstracting title, title searching, examining title, or determining the insurability of title,
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and every other activity, exclusive of escrow, settlement, or closing charges, whether denominated
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premium or otherwise, made by a title insurer, an agent of a title insurer, a title insurance agent,
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or any of them.
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(4) Beginning July 1, 1986, former county mutuals and former mutual benefit associations
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shall pay the premium tax or assessment due under this chapter. All premiums received after July
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1, 1986, shall be considered in determining the tax or assessment.
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(5) The following insurers are not subject to the premium tax on health care insurance that
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would otherwise be applicable under Subsection (1)(a):
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(a) insurers licensed under Title 31A, Chapter 5, Domestic Stock and Mutual Insurance
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Corporations;
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(b) insurers licensed under Title 31A, Chapter 7, Nonprofit Health Service Insurance
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Corporations;
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(c) insurers licensed under Title 31A, Chapter 8, Health Maintenance Organizations and
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Limited Plans;
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(d) insurers licensed under Title 31A, Chapter 9, Insurance Fraternals;
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(e) insurers licensed under Title 31A, Chapter 11, Motor Clubs;
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(f) insurers licensed under Title 31A, Chapter 13, Employee Welfare Funds and Plans; and
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(g) insurers licensed under Title 31A, Chapter 14, Foreign Insurers.
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(6) An insurer issuing multiple policies to an insured may not artificially allocate the
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premiums among the policies for purposes of reducing the aggregate premium tax or assessment
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applicable to the policies.
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(7) The retaliatory provisions of Title 31A, Chapter 3, Department Funding, Fees, and
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Taxes, apply to the tax or assessment imposed under this chapter.
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(8) A premium tax paid to the General Fund may not be collected on premiums paid to
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public agency insurance mutuals.
Legislative Review Note
as of 1-13-00 8:04 AM
A limited legal review of this legislation raises no obvious constitutional or statutory concerns.