Under current law, the PSC is required to establish standards for water or
sewer service that is provided to occupants of a mobile home park by the park
operator or a contractor. The PSC's rules must include requirements for metering,
billing, depositing, arranging deferred payment, installing service, refusing or
discontinuing service, and resolving disputes about service. The rules must also
ensure that charges are reasonable and not unjustly discriminatory, that service is
reasonably adequate, and that any related practice is just and reasonable. This bill
transfers authority to regulate water and sewer service provided to occupants of
manufactured home parks from the PSC to the department of commerce.
This bill creates immunity from liability for public utilities for stray voltage.
Under the bill, a public utility is immune from liability for any damage caused by or
resulting from stray voltage contributed by the public utility if the stray voltage is
below the level of concern established by the PSC. In addition, the stray voltage must
be determined using the PSC's principles and guidelines regarding stray voltage
screening and diagnostic procedures. Upon the request of any party to an action for
damages for stray voltage, the PSC must evaluate and testify as to whether its
applicable order was followed in calculating the amount of stray voltage. The bill
provides that damages from stray voltage are not subject to the current provision
that allows treble damages for injuries resulting from the willful, wanton, or reckless
acts or omissions of the public utility's directors, officers, employees, or agents.
This bill authorizes the PSC to conduct an energy assessment of any proposed
state agency rule that may affect state energy policies and, if the rule has a
significant impact on the state's energy policies, to prepare an energy impact
statement. The bill requires the state agency that is proposing the rule to consider
the PSC energy impact statement before final adoption of the rule and to include the
energy impact statement and the agency's response in the notice when the agency
submits its proposed rule in final form to the legislature.
Under current law, telecommunications utilities and providers are subject to
certain requirements regarding the protection of consumers, including other
telecommunications utilities and providers that use their services. The PSC, on its
own motion or upon a complaint filed by a consumer, may take administrative action
or commence civil actions against telecommunications utilities and providers to
enforce these requirements. This bill provides that the PSC has jurisdiction in its
own name or on behalf of consumers to take such actions. The bill also clarifies that
the PSC's authority to take administrative action includes initiating a contested
case.
Under current law, the PSC may bring an action in court for injunctive relief
for compelling compliance with the requirements, for compelling refunds of any
moneys collected in violation of the requirements, or for any other relief under the
public utility statutes. This bill also allows the PSC to take administrative action,
in addition to bringing an action in court, for compelling compliance with the
requirements or for compelling refunds. The bill also allows the PSC to take
administrative action or bring an action in court for any other appropriate relief,
instead of just any other relief under the public utility statutes. Also, the bill allows
the PSC to directly impose forfeitures for violations of the requirements.
Under current law, the PSC may request the attorney general to bring an action
in court to require a telecommunications utility or provider to compensate any
person for any pecuniary loss caused by failure to comply with the requirements.
Under this bill, in addition to requesting the attorney general to bring such an action,
the PSC may take administrative action, including initiating a contested case, or
bring its own action in court to require such compensation.
Under current law, the PSC may investigate whether rates, tolls, charges,
schedules, or joint rates are unjust, unreasonable, insufficient, unjustly
discriminatory or preferential, or unlawful and order that reasonable rates, tolls,
charges, schedules, or joint rates be imposed, observed, or followed in the future.
With respect to telecommunications providers, this bill also allows the PSC to order
reasonable compensation for persons injured by reason of rates, tolls, charges,
schedules, or joint rates of telecommunications providers that are investigated.
Under current law, public utilities and certain other entities, such as
telecommunications providers, that violate laws enforced by the PSC, PSC orders,
and certain other requirements are subject to a forfeiture of between $25 and $5,000,
for each day of violation, which is imposed by a court. Under this bill, the PSC may
also impose such a forfeiture against a telecommunications provider by
administrative action.
Under current law, the PSC is required to inquire into neglect or violation of
laws by public utilities and telecommunications carriers, enforce such laws, and
report all violations to the attorney general. This bill also allows the PSC to take
administrative action and institute and prosecute all necessary actions and
proceedings for enforcing all laws relating to telecommunications providers or
telecommunications carriers, and for the punishment of all violations.
This bill requires DOA to award grants to operators of dairy, beef, or swine
farms for eliminating stray voltage concerns and sources or replacing electrical
wiring. The bill creates a farm rewiring fund, consisting of contributions that certain
gas and electric utilities make to the PSC, from which the grants are made. A farm
operator is not eligible for grants unless the public utility that provides electric
service to the farm has conducted tests to determine the sources of stray voltage on
the farm.
Under current law, the PSC is allowed to assess against a public utility the
expenses incurred by the PSC in taking regulatory action with respect to the public
utility. The PSC is allowed to make similar assessments against other entities under
its jurisdiction, including a person seeking approval to construct a wholesale
merchant plant. A wholesale merchant plant is electric generating equipment that
does not serve retail customers and that is owned and operated by either: 1) a person
that is not a public utility; or 2) subject to approval of the PSC, an affiliate of a public
utility.
Current law imposes a limit on the amount that the PSC may assess against
a public utility or other entity under the PSC's jurisdiction. The total amount that
the PSC may assess in a calendar year may not exceed four-fifths of one percent of
the public utility's or entity's gross operating revenues derived from intrastate
operations in the last preceding calendar year.
Under this bill, the limit on assessments does not apply to assessments for the
expenses incurred by the PSC in taking regulatory action with respect to approving
construction of wholesale merchant plants.
Other state government
Creation of department of electronic government
This bill creates a department of electronic government (DEG). The bill
transfers most existing functions of DOA relating to information technology and
telecommunications to DEG and creates a number of new functions for DEG. The
bill grants DEG broad powers to manage the state's information technology and
telecommunications systems. Under the bill, the secretary of information services,
who serves as department head, is titled the "chief information officer." The officer's
position is assigned to executive salary group 8 ($82,979 to $128,618 per year in
2000-01). The officer is appointed by the governor to serve at his or her pleasure.
The officer appoints the staff of DEG, which includes a deputy, executive assistant,
and three division administrators outside the classified service.
The bill also creates an information technology management board which is
attached to DEG. The board consists of the governor, chief information officer,
secretary of administration, and two heads of state executive branch agencies and
two other members appointed by the governor without senate confirmation. The
board advises DEG, monitors progress in attaining the state's information
technology goals, and hears and decides appeals of actions of the officer by executive
branch agencies.
The bill directs DEG, with the assistance of executive branch agencies and the
advice of the board, to manage the information technology portfolio of state
government to meet specified criteria. The portfolio includes information technology
systems, applications, infrastructure and information resources, and human
resources devoted to developing and maintaining information technology systems.
Currently, each executive branch agency is required to prepare, revise, and
submit annually to DOA, for its approval, an information technology strategic plan
that details how the agency plans to use information technology to serve its needs
and those of its clients. This bill makes proposed strategic plans of executive branch
agencies subject to approval of the chief information officer, with the advice of the
board.
The bill permits DEG to acquire, operate, or maintain any information
technology equipment or systems required by DEG to carry out its functions and to
provide information technology development and management services related to
those systems. Under the bill, DEG may assess executive branch agencies for the
costs of equipment or systems acquired, operated, maintained, or provided or
services provided and may also charge legislative and judicial agencies for these
costs as a component of any services provided by DEG to these agencies. The bill also
permits DEG to assume direct responsibility for the planning and development of
any information technology system in the executive branch of state government that
the chief information officer determines to be necessary to effectively develop or
manage the system, with or without the consent of any affected agency. The bill
permits DEG to charge any executive branch agency for its reasonable costs incurred
on behalf of the agency in carrying out this function.
Currently, DOA must provide computer services to state agencies in the
executive, legislative, and judicial branches. DOA may also provide
telecommunications services to those agencies and computer or telecommunications
services to local governments and private schools, postsecondary institutions,
museums, and zoos. DOA may also provide supercomputer services to state
agencies, local governments, and entities in the private sector. Under this bill, DEG
may enter into an agreement to provide any services that DEG is authorized to
provide to any state agency or authority, any unit of the federal government, any local
governmental unit, or any entity in the private sector. DEG may also develop and
operate or maintain any system or device facilitating Internet or telephone access to
information about programs of state agencies or authorities, local governmental
units, or entities in the private sector by means of electronic communication and may
assess or charge agencies, authorities, units, and entities in the private sector for its
costs of development, operation, or maintenance on the same basis that DEG
assesses or charges for information technology equipment or systems.
The bill appropriates to DEG all revenues received from assessments or
charges, without limitation, for the purpose of carrying out its functions. The bill also
appropriates general purpose revenue to DEG equivalent to the depreciated value
of its equipment.
Currently, the number of full-time equivalent (FTE) positions for each state
agency within each revenue source is fixed by law or by the governor, JCF, or the
legislature in budget determinations. Program-revenue funded positions may be
adjusted by the governor with the concurrence of JCF and federally funded positions
may be adjusted by the governor alone. This bill permits the chief information officer
to transfer any number of FTE positions having responsibilities related to
information technology or telecommunications from any executive branch agency to
DEG or any other executive branch agency and to transfer the funding source for any
position from one source to another for the purpose of carrying out the functions of
DEG. Upon transfer of any position, the incumbent in that position is also
transferred without loss of pay, fringe benefits, or seniority privileges. The bill also
permits the officer to transfer moneys from the appropriation account for any
appropriation made to an executive branch agency, except a sum sufficient
appropriation, without the consent of the agency, for the purpose of facilitating more
efficient and effective funding of information technology or electronic
communications resources within the executive branch of state government. Under
the bill, any transfer of positions or funding may not be made if it would be
inconsistent with state or federal law or any requirement imposed by the federal
government as a condition to receipt of aids by this state.
Currently, every executive branch agency, other than the board of regents of the
UW system, is required to purchase computer services from DOA, unless DOA grants
permission to the agency to procure the services from a private source or from
another agency, or to provide the services to itself. This bill provides that every
executive branch agency, including the board of regents of the UW system, must
purchase all materials, equipment, supplies, and services relating to information
technology or telecommunications from DEG, unless DEG requires the agency to
purchase the materials, supplies, equipment, or contractual services under a master
contract established by DEG or unless DEG grants permission to the agency to
procure the materials, supplies, equipment, or services from a private source or from
another agency, or to provide the materials, supplies, equipment, or services to itself.
The bill also makes all contracts by any executive branch agency for the purchase of
materials, supplies, equipment, or contractual services relating to information
technology or telecommunications subject to review and approval of the chief
information officer.
Currently, subject to numerous exceptions, state agencies are generally
required to make purchases through solicitation of bids or competitive sealed
proposals preceded by public notice, and to allow DOC the opportunity to provide the
materials, supplies, equipment, or services under certain conditions if DOC is able
to do so. These requirements do not apply to purchases by the division of information
technology services of DOA relating to the functions of the division. This bill provides
that these requirements do not apply to purchases of any materials, supplies,
equipment, or services by DEG. The bill requires DEG to submit an annual report
to DOA concerning any purchases by DEG that are not made in accordance with
these requirements. The bill also permits DEG to establish master contracts for the
purchase of materials, supplies, equipment, or contractual services relating to
information technology or telecommunications for use by state agencies and
authorities, local governmental units, and entities in the private sector and to
require any executive branch agency to make purchases of materials, supplies,
equipment, or contractual services included under the master contract pursuant to
that contract.
Currently, executive branch agencies must make purchases through DOA
unless DOA delegates direct purchasing authority to the agencies. DOA prescribes
standard specifications for state purchases which agencies are generally required to
incorporate into purchasing orders and contracts when appropriate. Under this bill,
DOA must delegate authority to DEG to make all of its purchases independently of
DOA, and any standard specifications prescribed by DOA for the purchase of
materials, supplies, equipment, or services for information technology or
telecommunications purposes are subject to approval of the chief information officer.
Elections administration
Under current law, voter registration is required in every municipality with a
population greater than 5,000. The information required on voter registration forms
is specified by law. This bill requires voter registration in every municipality. The
bill also establishes a centralized, statewide voter registration list that is maintained
by the state elections board. Under the bill, the list must be electronically accessible
by any person, but no person other than an authorized election official may change
the list. The bill permits the board to change the list only for the purpose of deleting
the registration of individuals who register to vote outside this state or whose
registrations are required to be cancelled as the result of a municipal canvass. Under
the bill, each municipal clerk or board of election commissioners must electronically
enter registrations or changes of registration on the list, except that the bill permits
the town clerk of any town having a population of not more than 5,000 to designate
the county clerk of the county where the town is located as the town clerk's agent for
entry of this data. The bill also directs the board to provide grants to counties and
municipalities to finance the cost of maintenance of the list.
Currently, with certain exceptions, the deadline for voter registration is 5 p.m.
on the second Wednesday before an election. However, electors may also register in
person at the office of the municipal clerk or board of election commissioners up to
5 p.m. on the day before the election or, in most cases, may register at the proper
polling place on election day. Currently, an individual who registers after the
deadline must provide a specified form of proof of residence. If the individual is
unable to do so, another qualified elector of the same municipality may corroborate
the information contained in the individual's registration form. The corroborating
elector then must provide this proof of residence. Currently, there is no limit on the
number of times a person may act as a corroborating elector.
This bill requires any elector who registers to vote after the deadline, if possible,
to present a valid Wisconsin driver's license or valid Wisconsin identification card
containing the elector's photograph and current street address. The bill permits any
other elector to present an identification card that contains the elector's photograph
and current street address or any other identification card that contains the elector's
name and photograph and an identifying number. An elector who is unable to
present any identification may have his or her identity and registration information
corroborated by another elector as currently provided. However, under the bill, a
corroborating elector may not corroborate more than two registrations in one day.
The bill also permits the board, by rule, to specify additional information that must
be provided on registration forms. In addition, the bill provides that any election
official who fails to exercise due care to lawfully register an elector to vote is subject
to a forfeiture (civil penalty) of not more than $1,000.
With certain limited exceptions, before being permitted to vote at any polling
place, an elector currently must provide his or her name and address. If registration
is required to vote and the elector is not registered, the elector must provide a
specified form of proof of residence to register. If registration is not required, the
elector may be required to provide this proof. With certain limited exceptions, this
bill requires each elector attempting to vote at any polling place in a municipality to
follow the same identification or corroboration procedure that is required under the
bill for late voter registration. The bill requires election officials to verify that the
name and address on any identification are the same as the elector's name and
address on the list of registered electors. Under the bill, election officials must also
verify that the photograph contained in any identification reasonably resembles the
elector. The identification procedure does not affect absentee voting or voting by
military electors.
Currently, following each general election, a municipality where registration is
required must complete a canvass to identify each registered elector who has failed
to vote within the previous four years, attempt to notify each such elector, and revise
and correct its list of registered electors accordingly. This bill provides that if a
municipality fails to complete the canvass within 120 days of the general election,
the board may conduct the canvass at the expense of the municipality.
Currently, each municipality appoints and supervises election inspectors (poll
workers). Under this bill, if the board finds that an inspector has repeatedly and
materially failed to substantially comply with the election laws or rules of the board,
the board may remove the inspector and appoint a replacement to serve the
remainder of the inspector's unexpired term. The replacement must be compensated
by the municipality and is subject to the supervision of the municipal clerk or board
of election commissioners. However, unlike most other inspectors, the replacement
may be appointed without regard to party affiliation. The bill also permits the board
to appoint a special master to assume all functions of the municipal clerk or board
of election commissioners if the board finds that a municipality has repeatedly and
materially failed to substantially comply with the election laws or rules of the board
in administering elections. The bill requires the municipality to pay all costs
incurred relating to the special master.
Under current law, the board may promulgate rules to interpret or implement
the laws relating to the conduct and administration of elections and election
campaigns. This bill expands the board's rule-making authority, permitting the
board to promulgate rules to promote the efficient and fair conduct of elections. This
bill also directs the board to conduct training programs so that individuals exercising
the right of access to polling places may inform themselves of the election laws, the
procedures for conducting elections, and the rights of individuals who observe
election proceedings.
Land information and land use
Currently, the land information board is attached to DOA. The board serves as
a state clearing house for access to land information and provides technical
assistance to state agencies and local governmental units with land information
responsibilities, reviews and approves county plans for land records modernization,
and provides aids to counties, derived from recording fee revenues collected by
counties, for land records modernization projects. Under current law, the board and
its functions are abolished effective on September 1, 2003. This bill abolishes the
land information board on the day the bill becomes law and permanently transfers
its functions, together with its assets and liabilities, to DOA.
Under the Land Information Program, a number of state agencies, including
DOA, DATCP, DHFS, DNR, and DOR, are required to submit biennially to the land
information board a plan to integrate land information so that the information is
readily translatable, retrievable, and geographically referenced for use by any state,
local governmental unit, or public utility. This bill eliminates the requirement that
DOR submit such a plan, beginning with the plan that is due in 2002.
Currently, counties collect a land record fee for recording and filing most
instruments that are recorded or filed with the register of deeds. The fee is $10 for
the first page of an instrument and $2 for each additional page. Until September 1,
2003, counties must remit $2 of each $10 collected for recording or filing the first page
of each instrument to the land information board, which the board uses to fund its
general program operations and to make grants to counties for land records
modernization projects. Currently, if a county does not have a land information office
or does not use $4 of the fee for recording or filing the first page of an instrument for
land records modernization, the county must remit $6 of the fee for recording or filing
the first page of an instrument to the land information board. On September 1, 2003,
the fee for recording or filing the first page of an instrument is reduced from$10 to
$8 and no portion is remitted to the state.
This bill permanently increases the fee for recording or filing the first page of
an instrument with a register of deeds from $10 to $11, and requires a county to remit
either $2 or $7 of this fee to DOA, depending on whether the county has a land
information office and uses the fee for land records modernization.
Currently, DOA may provide grants to local governments to be used to finance
a portion of the cost of certain comprehensive planning activities from general
purpose revenue. This bill provides, in addition, for a portion of the land record fee
received by DOA to be used for that purpose.
Under current law, the Wisconsin land council in DOA must perform duties
including identifying and recommending to the governor land use goals and
priorities, identifying and studying areas of conflict in the state's land use statutes
and between state and local land use laws and recommending to the governor
legislation to resolve the conflicts, and studying the development of a
computer-based land information system.
This bill discontinues the council's function of studying the development of a
computer-based land information system, and adds several new functions to the
council's duties, including establishing a land information working group and
reviewing county land records modernization plans. The bill also adds three
members to the 16-member council and eliminates the council's sunset date of
September 1, 2003.
Under current law, DOA awards transportation planning grants to local
governmental units (cities, villages, towns, counties, and regional planning
commissions) to pay for planning activities related to the transportation element of
a comprehensive land use and development plan. Under this bill, DOA may also
award transportation planning grants to assist local governmental units in the
integrated transportation and land-use planning for highway corridors (areas
expected to need additional capacity for vehicular traffic or to have possible safety
or operational problems resulting from pressure for development). The bill requires
DOA to award transportation planning grants in the following order of priority: 1)
grants that pay for planning activities related to a transportation element and which
also assist in highway corridor planning; 2) grants that only pay for planning
activities related to a transportation element; and 3) grants that only assist in
highway corridor planning. The bill also expands the definition of "local
governmental unit" to include a metropolitan planning organization (an
organization that develops transportation plans and programs).
State procurement services
Currently, DOA provides procurement services to state agencies and some local
governments. These procurement functions are financed with general purpose
revenue. This bill permits DOA to assess any state agency or local government to
which it provides procurement services for the cost of the services provided to the
agency or local government. The bill also permits DOA to identify savings that DOA
determines were realized by any state agency to which it provides procurement
services, and to assess the agency for not more than the amount of the savings so
identified. The bill does not define "savings" and does not specify any methodology
for determination of these assessments. The bill appropriates to DOA all moneys
collected from these assessments to be used to finance procurement services. The
change potentially decreases the moneys available to agencies and local
governments for other purposes. The bill also appropriates moneys from the revenue
sources that finance the programs of state agencies to supplement the unbudgeted
costs of procurement service charges, except charges for identified procurement
savings.
Currently, subject to numerous exceptions, DOA, or any state agency in the
executive branch to which DOA delegates purchasing authority, must make
purchases by bid or competitive sealed proposal that must be preceded by at least two
notices published in the official state newspaper, the latest of which must be inserted
at least seven days prior to opening of the bids or competitive sealed proposals. This
bill permits DOA or any state agency to which DOA delegates purchasing authority
to make purchases by soliciting sealed bids to be opened at a specified date and time
or by solicitation of bids at an auction to be conducted electronically at a specified
date and time, or by competitive sealed proposal. If bids are to be solicited at an
electronic auction, the bill requires notice of the auction to be posted on an Internet
site determined or authorized by DOA at least seven days prior to the date of the
auction. The bill also permits notice of any proposed purchase by DOA or an agency
to which DOA delegates purchasing authority to be posted electronically on an
Internet site determined or authorized by DOA at least seven days prior to the date
that bids or competitive sealed proposals are to be opened or bids are to be received
by auction in lieu of the publication required under current law.
Currently, DOA maintains a subscription service that provides current
information of interest to prospective vendors concerning state procurement
opportunities. This bill permits DOA to permit prospective vendors to provide
product or service information through this service and also permits DOA to
prescribe fees or establish fees through a competitive process for the use of the
service. Any revenue collected from the fees is deposited in the state VendorNet fund,
which is used to pay the costs of the subscription service.
Municipal boundary review
Currently, DOA is required to review proposed municipal incorporations and
certain municipal annexations in counties having a population of 50,000 or more,
and to make findings with respect to certain matters specified by law. Currently, the
cost of conducting this review is financed with general purpose revenue.
This bill permits DOA to prescribe and collect a fee for conducting this review.
The fee must be paid by the person or persons filing a petition for incorporation or
by the person or persons filing a notice of proposed annexation. The bill appropriates
to DOA all moneys collected from these fees to finance reviews of proposed municipal
incorporations and annexations.
Federal-state relations
Current law directs DOA to operate a federal aid management service. The
service is directed to process applications by state agencies for grants from the
federal government upon request of the agencies. DOA may assess any state agency
to which DOA provides services a fee for its expenses incurred in providing those
services.
This bill directs DOA to initiate contacts with the federal government for the
purpose of facilitating participation by state agencies in federal aid programs, to
assist those agencies in applying for such aid, and to facilitate influencing the federal
government to make policy changes that will be beneficial to this state. The bill also
permits DOA to assess agencies to which DOA provides those services a fee for its
expenses incurred in providing those services.
Dual state employment or retention
Current law prohibits any elective state official from holding any other position
or being retained in any other capacity with a state agency or authority, except an
unsalaried position or unpaid service with a state agency or authority that is
compatible with the official's duties, the emoluments of which are limited to
reimbursement for actual and necessary expenses incurred in the performance of
those duties. Current law also prohibits any other individual who is employed in a
full-time position or capacity with a state agency or authority from holding another
position or being retained in another capacity with a state agency or authority from
which the individual receives, directly or indirectly, more than $12,000 from the
agency or authority as compensation for the individual's services during the same
year. These prohibitions do not apply to an individual other than an elective state
official who has a full-time appointment for less than 12 months during any period
of time that is not included in the appointment. This bill repeals both of these
prohibitions.
Energy efficiency fund elimination
Currently, state agencies may apply for loans from the energy efficiency fund
to finance energy efficiency projects. The loans are repaid from utility expense
appropriations made to the agencies in an annual amount equal to the utility
expense savings realized by the agencies as a result of the energy efficiency projects.
In addition, for six years after each loan is repaid, DOA may transfer an amount
equal to one-third of the savings realized to the general fund, and an amount equal
to one-third of the savings realized to the energy efficiency fund for maintenance of
projects with an energy efficiency benefit and for energy efficiency monitoring. An
amount equal to the final one-third of the savings realized may be utilized by an
agency for its general program operations, subject to approval of JCF.
This bill abolishes the energy efficiency fund. Under the bill, DOA may transfer
an amount equal to all repayments of loans made from the fund for energy efficiency
projects from the appropriate utility expense appropriations to the general fund.
Any unencumbered balance in the energy efficiency fund on the day the bill becomes
law is also transferred to the general fund.
State-local partnership
This bill directs that DOA, to the extent possible, coordinate state policies
governing the relationship between the state and local governments in this state and
attempt to make those policies as uniform as practicable. The bill also permits DOA
to attempt to mediate disputes between local governments and state agencies to the
extent feasible. To carry out these functions, the bill directs DOA to appoint a
state-local government coordinator outside the classified service.
taxation
Income taxation
Under current law, when computing corporate income taxes and franchise
taxes, a formula is used to attribute a portion of a corporation's income to this state.
The formula has three factors: a sales factor, a property factor, and a payroll factor.
The sales factor represents 50% of the formula and the property and payroll factors
each represent 25% of the formula. When computing income taxes and franchise
taxes for an insurance company, a formula with a premium factor and a payroll factor
is used to attribute a portion of an insurance company's income to this state.
Under this bill, beginning on January 1, 2005, the sales factor will be the only
factor used to attribute a portion of a corporation's income to this state. The property
and payroll factors will be decreased, and eventually phased out, over the next four
years as the sales factor is increased and becomes the only factor. Beginning on
January 1, 2005, the premium factor will be the only factor used to attribute a portion
of an insurance company's income to this state. The payroll factor will be decreased,
and eventually phased out, over the next four years as the premium factor is
increased and becomes the only factor.
Under current law, the income of an electric or gas utility is apportioned by
rules established by DOR. Under the bill, for taxable years beginning after
December 31, 2002, and before January 1, 2005, the income of an electric or gas
utility is apportioned in the same manner as the income of a corporation under the
bill. Beginning on January 1, 2005, the sales factor will be the only factor used to
attribute a portion of the income of an electric or gas utility to this state.
Under current law, the income of a financial organization is apportioned, for
corporate income tax and franchise tax purposes, by rules established by DOR.
Under the bill, for taxable years beginning after December 31, 2002, and before
January 1, 2005, the income of a financial organization is apportioned by multiplying
that income by a fraction that includes a sales factor representing more than 50% of
the fraction, as determined by rule by DOR. For taxable years beginning after
December 31, 2004, the income of a financial organization is apportioned by using
a sales factor, as determined by DOR.
Under current law, an inter vivos trust (a trust that is created during the life
of the grantor) that is made irrevocable before October 29, 1999, is considered
resident at the place where the trust is being administered. This state taxes a trust
that is resident within this state. Also under current law, in general, an inter vivos
trust is taxable by this state if the grantor was a resident of this state.
Under this bill, an inter vivos trust that is made irrevocable before October 29,
1999, is considered resident, and is thus taxable by this state, only if the trust was
administered in this state before October 29, 1999, or, if administered in this state
on or after October 29, 1999, if the grantor is a resident of this state. This change
first applies to taxable years beginning on January 1, 1999.
Under current law, the individual income tax brackets are indexed for inflation.
Generally, for taxable years beginning after December 31, 1999, the brackets are
increased each year based on the annual percentage change between the consumer
price index (CPI) for August of the previous year and August 1997. An exception to
the general rule is that for taxable years beginning after December 31, 2000, the top
bracket is increased each year by the same percentage as the percentage change
between the CPI for August of the previous year and August 1999. This bill limits
the applicability of the exception to the general rule that governs indexing of the
individual income tax brackets to taxable year 2001.
Under current law, resident shareholders of subchapter S corporations and
members of limited liability corporations (LLCs) treated as partnerships may claim
a tax credit for taxes that those S corporations and LLCs pay to another state. This
bill expands the application of this tax credit so that it may be claimed by otherwise
qualified resident partners of a partnership that pays taxes to another state.
