HB 1546-1_ Filed 04/03/2013, 12:03

COMMITTEE REPORT

MADAM PRESIDENT:

    The Senate Committee on Tax and Fiscal Policy, to which was referred House Bill No. 1546, has had the same under consideration and begs leave to report the same back to the Senate with the recommendation that said bill be AMENDED as follows:

SOURCE: Page 16, line 20; (13)CR154602.16. -->     Page 16, between lines 20 and 21, begin a new paragraph and insert:
SOURCE: IC 6-3.5-1.1-2.5; (13)CR154602.12. -->     "SECTION 12. IC 6-3.5-1.1-2.5, AS AMENDED BY P.L.119-2012, SECTION 37, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2013]: Sec. 2.5. (a) This section applies only to Jackson County.
    (b) As used in this section, "fiscal year" means a twelve (12) month period beginning July 1 and ending June 30.
    (c) (b) The county council may, by ordinance, determine that additional county adjusted gross income tax revenue is needed in the county to fund the operation and maintenance of a jail and juvenile detention center opened after July 1, 1998.
    (d) (c) Notwithstanding section 2 of this chapter, if the county council adopts an ordinance under subsection (c), (b), the county council may impose the county adjusted gross income tax at a rate of one and one-tenth percent (1.1%) on adjusted gross income for fiscal calendar years beginning ending before July 1, 2011. January 1, 2024. For fiscal calendar years beginning after June 30, 2011, December 31, 2023, the rate is reduced to one percent (1%). If the county council imposes the county adjusted gross income tax at a rate of one and one-tenth percent (1.1%), the county council may decrease

the rate or rescind the tax in the manner provided under this chapter.
    (e) (d) If the county imposes the county adjusted gross income tax at a rate of one and one-tenth percent (1.1%) under this section, the revenue derived from a tax rate of one-tenth percent (0.1%) on adjusted gross income:
        (1) shall be paid to the county treasurer;
        (2) may be used only to pay the costs of operating a jail and juvenile detention center opened after July 1, 1998; and
        (3) may not be considered by the department of local government finance in determining the county's maximum permissible property tax levy limit under IC 6-1.1-18.5.

SOURCE: IC 6-3.5-1.1-27; (13)CR154602.13. -->     SECTION 13. IC 6-3.5-1.1-27 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2013]: Sec. 27. (a) This section applies only to an additional tax rate imposed in Jackson County under section 2.5 of this chapter.
    (b) This subsection applies to an additional tax rate imposed after June 30, 2011, and before July 1, 2013. Notwithstanding section 2.5 of this chapter (as in effect on January 1, 2013), the imposition, collection, and distribution of county adjusted gross income taxes attributable to the additional tax rate is legalized and validated.
    (c) Any action described in subsection (b) of:
        (1) the department;
        (2) the budget agency; or
        (3) an officer or employee of Jackson County;
is legalized and validated.
    (d) The additional tax rate:
        (1) authorized by the county council under section 2.5 of this chapter (as in effect on January 1, 2013); and
        (2) legalized and validated by subsection (c);
remains in effect for the calendar years specified in section 2.5(c) of this chapter without additional county council action. However, this subsection may not be construed to limit the ability of the county council to decrease the rate or rescind the tax in the manner provided under this chapter.
".
SOURCE: Page 22, line 30; (13)CR154602.22. -->     Page 22, line 30, after "0" strike "lbs".
    Page 26, line 30, delete "or".
    Page 27, line 27, after "from" insert " the following during the disaster period:".
    Page 27, line 27, delete "paying state or local income taxes during the disaster".
    Page 27, line 28, delete "period,", begin a new line block indented and insert:
        " (1) Paying any state or local taxes, including ad valorem and payroll taxes,".
    Page 27, between lines 35 and 36, begin a new line block indented and insert:
        " (2) Paying state gross retail and use tax on equipment used or consumed during the disaster period.
        (3) Complying with any state or local business, occupational licensing, or registration requirements.
        (4) Providing worker's compensation insurance under IC 22-3-5.
        (5) Making employer contributions to the unemployment compensation system under IC 22-4-10.
".
    Page 27, line 39, after ";" delete "or".
    Page 27, line 40, delete "become" and insert " be".
    Page 27, line 40, after ";" insert " or".
    Page 27, between lines 40 and 41, begin a new line block indented and insert:
        " (3) file and pay any other state or local tax or fee;".
    Page 28, line 3, after "emergency" insert " related".
    Page 28, delete line 8.
    Page 28, line 9, delete "(3)" and insert " (2)".
    Page 28, line 10, delete "(4)" and insert " (3)".
    Page 28, delete lines 11 through 21, begin a new line block indented and insert:
        " (4) gross retail taxes or use taxes on a purchase of materials or services by the out-of-state business or out-of-state employee for use or consumption during the disaster period, unless the purchase is otherwise exempt during a disaster period.".
    Page 28, line 39, strike "the United States mail".
    Page 28, line 40, strike "in".
    Page 28, line 41, after "(1)" insert " United States".
    Page 28, line 42, after "(2)" insert " United States".
    Page 29, line 1, after "(3)" insert " United States".
    Page 29, line 2, after "(4)" insert " a".
    Page 35, between lines 26 and 27, begin a new paragraph and insert:
SOURCE: IC 6-8.1-9.7; (13)CR154602.38. -->     "SECTION 38. IC 6-8.1-9.7 IS ADDED TO THE INDIANA CODE AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2013]:
     Chapter 9.7. Treasury Offset Program
    Sec. 1. As used in this chapter, "debt" means a delinquent state tax or non-tax debt certified by the treasurer of state or a federal non-tax debt certified by a federal official. The term includes, but is not limited to, fines, fees, penalties, and other non-tax assessments imposed by or payable to the state or federal government that are finally determined to be due and owing.
    Sec. 2. As used in this chapter, "federal official" means a unit or official of the federal government that:
        (1) is charged with the collection of non-tax liabilities payable to the federal government; and
        (2) has the authority to make offsets under an offset agreement.
    Sec. 3. As used in this chapter, "offset agreement" means an agreement between the office of management and budget and the Secretary of the Treasury of the United States authorized by this chapter.
    Sec. 4. As used in this chapter, "person" means an individual, vendor, contractor, partnership, society, association, joint stock company, limited liability company, corporation, estate, receiver, trustee, or assignee, any other person acting in a fiduciary or representative capacity whether appointed by a court or otherwise, or any combination of such individuals or entities.
    Sec. 5. (a) As used in this chapter, "state payments" includes tax refunds and any vendor or contractor payments made by the state to any person, including expense reimbursements to an employee of the state.
    (b) The term does not include salary, wages, pension payments, and any other type, class, or amount of payment that the office of management and budget determines has an impact on the health or welfare of the citizens of Indiana and should not be subject to an

offset agreement.
    Sec. 6. As used in this chapter, "tax refund" means an amount described as a refund of tax under the provision of the state tax law that authorized the payment of the refund.
    Sec. 7. Notwithstanding any other law, the office of management and budget may enter into an offset agreement with the Secretary of the Treasury of the United States government to participate in a reciprocal Treasury Offset Program under 31 U.S.C. 3716 for the collection of any debts owed to the state or to state agencies from federal payments to vendors, contractors, and taxpayers. The offset agreement may provide for the federal government to submit non-tax debts owed to federal agencies for offset against state payments otherwise due and owing to taxpayers and to vendors and contractors providing goods or services to the state or to the state's departments, agencies, or institutions.
    Sec. 8. If the office of management and budget enters into an offset agreement, a federal official may do the following as provided in the offset agreement:
        (1) Certify to the office of management and budget the existence of a person's delinquent non-tax debt owed by the person to the federal government, by providing:
            (A) the full name and address of the person and any other names known to be used by the person;
            (B) the person's Social Security number or federal tax identification number;
            (C) the amount of the person's federal non-tax debt;
            (D) a statement certifying that the person's federal non-tax debt is past due, that due process has been provided to the person, and that the person's federal non-tax debt is legally enforceable in the amount certified, which may be provided in procedures for certifying payments as specified in the offset agreement; and
            (E) any other information required by the offset agreement.
        (2) Request the office of management and budget to withhold any state payment to which the person is entitled.
        (3) Retain a part of the proceeds of any federal administrative setoff authorized by the federal offset program.


    Sec. 9. The following apply if the office of management and budget enters into an offset agreement:
        (1) The office of management and budget shall do the following as provided in the offset agreement:
            (A) Determine if a person whose name has been certified by a federal official as provided in the offset agreement is due a state payment.
            (B) Withhold a state payment that is due a person whose name has been certified by a federal official as provided in the offset agreement.
            (C) Notify the person from whom a state payment is withheld under this section of the amount withheld in accordance with the offset agreement.
            (D) Pay to the federal official making the certification under section 8 of this chapter the lesser of:
                (i) the entire state payment withheld; or
                (ii) the amount certified by the federal official.
            If the amount certified by the federal official is less than a state payment due to the person, the office of management and budget shall pay to the person the part of the state payment due to the person that exceeds the certified amount, less any fee under section 10 of this chapter.
        (2) If an individual filed a joint income tax return and the debt certified by a federal official is not the liability of both parties to the joint income tax return, the office of management and budget may not withhold or pay to the federal official the part of the income tax refund attributable to the individual not owing the debt. The department shall notify taxpayers filing a joint income tax return of a proposed offset of a state income tax refund for a debt certified by a federal official. A taxpayer that filed a joint income tax return and that receives such a notice may, not more than sixty (60) days after the notice is sent, notify the department in writing that the taxpayer asserts that a part of the income tax refund is attributable to the individual not owing the debt. If a taxpayer that is a party to the joint income tax return does not notify the department of such an assertion not more than sixty (60) days after the department's notice is sent, all of the

income tax refund is considered attributable to the individual owing the debt.
        (3) The office of management and budget may do the following as provided in the offset agreement:
            (A) Certify to a federal official a person's delinquent debt owed to the state by providing the federal official:
                (i) the full name and address of the person and any other names known to be used by the person;
                (ii) the person's Social Security number or federal tax identification number;
                (iii) the amount of the person's debt owed to the state;
                (iv) a statement certifying that the person's debt is past due, that due process has been provided to the person, and that the person's debt is legally enforceable in the amount certified, which may be provided in procedures for certifying payments as specified in the offset agreement; and
                (v) any other information required by state law or rules applicable to the collection of the debt by offset of federal payments or required by the offset agreement.
            (B) Request that the federal official withhold from any federal payment to which the person is entitled the lesser of:
                (i) the entire federal payment; or
                (ii) the amount certified by the office of management and budget;
            as provided in the offset agreement. If the amount certified by the office of management and budget is less than a federal payment due to the person, the federal official may pay to the person the part of the federal payment due to the person that exceeds the certified amount, less any fee under section 10 of this chapter.
    Sec. 10. (a) The office of management and budget may, by rule, establish a reasonable administrative fee to be charged to a person for the provision of the state offset of a federal debt or the federal offset of a state debt.
    (b) A fee authorized by this section is a separate debt and may be withheld from any refund, reimbursement, or other money held

for the person.
    (c) The office of management and budget may charge the person who is the subject of state offset of a federal debt or the federal offset of a state debt the fee authorized by this section.
    (d) Any fees collected under this section may be retained by the office of management and budget and used for the costs of the intercept program, including reporting, and for costs associated with other revenue generation and cost savings initiatives as determined by the office of management and budget
.".

SOURCE: Page 40, line 1; (13)CR154602.40. -->     Page 40, between lines 1 and 2, begin a new paragraph and insert:
    " (f) The following apply to rules adopted by the bureau before January 1, 2014, under subsection (e):
        (1) The rules are transferred to the department of state revenue on January 1, 2014, and are considered, after December 31, 2013, rules of the department of state revenue.
        (2) After December 31, 2013, the rules are treated as if they had been adopted by the department of state revenue.
".
    Page 43, line 24, delete "IC 35-43-5-4.4(a)(1))" and insert " IC 35-43-5-4.6(a)(1))".
    Page 43, line 25, delete "IC 35-43-5-4.4(a)(3))." and insert " IC 35-43-5-4.6(a)(3)).".
    Page 44, line 24, delete "IC 35-43-5-4.4" and insert "IC 35-43-5-4.6".
    Page 44, line 26, delete "Sec. 4.4." and insert " Sec. 4.6.".
    Renumber all SECTIONS consecutively.
    (Reference is to HB 1546 as printed February 18, 2013.)

and when so amended that said bill do pass.

Committee Vote: Yeas 10, Nays 2.

____________________________________

    Hershman
Chairperson


CR154602/DI 73    2013