SB-0989, As Passed Senate, June 8, 2016

SENATE BILL No. 989

May 24, 2016, Introduced by Senators MACGREGOR, HORN, PROOS, SHIRKEY and STAMAS and referred to the Committee on Michigan Competitiveness.

A bill to amend 1937 PA 94, entitled

"Use tax act,"

by amending sections 3f and 21 (MCL 205.93f and 205.111), section

3f as amended by 2014 PA 161 and section 21 as amended by 2015 PA

263.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

Sec. 3f. (1) Beginning April 1, 2014 through December 31,

2016, the use or consumption of medical services provided by

entities identified in, and pursuant to contracts identified under,

section 106(2)(a) and section 109f(2) of the social welfare act,

1939 PA 280, MCL 400.106 and 400.109f, shall be taxed in the same

manner as tangible personal property is taxed under this act

notwithstanding any other provision or exemption under this act. As

used in this ~~section,~~ subsection, "medical services" means those

medical services provided only to ~~medicaid~~ Medicaid beneficiaries

enrolled under title XIX of the social security act, 42 USC 1396 to

1396w.

(2) Beginning January 1, 2017, the use or consumption of

medical services provided by entities identified in, and pursuant

to contracts identified under, section 106(2)(a) and section

109f(2) of the social welfare act, 1939 PA 280, MCL 400.106 and

400.109f, shall be taxed in the same manner as tangible personal

property is taxed under this act notwithstanding any other

provision or exemption under this act. As used in this subsection,

"medical services" means those medical services provided only to

beneficiaries enrolled under title XIX of the social security act,

42 USC 1396 to 1396w-5, or title XXI of the social security act, 42

USC 1397aa to 1397mm.

Sec. 21. (1) Except as provided in subsections (2), (3), (4),

(5), and ~~(5),~~ (6), all money received and collected under this act

shall be deposited by the department of treasury in the state

treasury to the credit of the general fund, to be disbursed only by

appropriations by the legislature.

(2) The collections from the use tax imposed at the additional

rate of 2% approved by the electors March 15, 1994 shall be

deposited in the state school aid fund established in section 11 of

article IX of the state constitution of 1963.

(3) From the money received and collected under this act for

the state share, an amount equal to all revenue lost under the

state education tax act, 1993 PA 331, MCL 211.901 to 211.906, and

all revenue lost from basic school operating mills as a result of

the exemption of personal property under sections 9m, 9n, and 9o of

the general property tax act, 1893 PA 206, MCL 211.9m, 211.9n, and

211.9o, as determined by the department, shall be deposited into

the state school aid fund established by section 11 of article IX

of the state constitution of 1963. Funds deposited into the state

school aid fund under this subsection shall not include the portion

of the state share of the use tax imposed at the additional rate of

2% approved by the electors of this state on March 15, 1994 and

dedicated for aid to schools under subsection (2).

(4) Money received and collected under this act for the local

community stabilization share is not state funds, shall not be

credited to the state treasury, and shall be transmitted to the

authority for deposit in the treasury of the authority, to be

disbursed by the authority only as authorized under the local

community stabilization authority act. The local community

stabilization share is a local tax, not a state tax, and money

received and collected for the local community stabilization share

is money of the authority and not money of this state.

(5) Beginning October 1, 2016 and the first day of each

calendar quarter thereafter, from the money received and collected

under this act for the state share, an amount equal to the

collections for the calendar quarter that is 2 calendar quarters

immediately preceding the current calendar quarter of the tax

imposed under this act at the additional rate of 2% approved by the

electors on March 15, 1994 from the use, storage, or consumption of

aviation fuel shall be distributed as follows:

(a) An amount equal to 35% of the collections of the tax

imposed at a rate of 2% on the use, storage, or consumption of

aviation fuel shall be deposited in the state aeronautics fund and

shall be expended, on appropriation, only for those purposes

authorized in the aeronautics code of the state of Michigan, 1945

PA 327, MCL 259.1 to 259.208.

(b) An amount equal to 65% of the collections of the tax

imposed at a rate of 2% on the use, storage, or consumption of

aviation fuel shall be deposited in the qualified airport fund and

shall be expended, on appropriation, only for those purposes

authorized under section 35 of the aeronautics code of the state of

Michigan, 1945 PA 327, MCL 259.35.

(6) The collections from the use tax imposed under section 3f

shall be deposited by the department of treasury in the state

treasury to the credit of the health services fund created in

section 11 of the Michigan trust fund act, 2000 PA 489, MCL 12.261,

to be disbursed, subject to the limitations under this subsection,

only by appropriations by the legislature in accordance with

section 11 of the Michigan trust fund act, 2000 PA 489, MCL 12.261.

The funds deposited into the health services fund pursuant to this

subsection shall not be used for any Medicaid benefits provided

under the medical assistance program created under sections 105 and

105d of the social welfare act, 1939 PA 280, MCL 400.105 and

400.105d, or for the medical services administration within the

department of health and human services for the administration of

the medical assistance program created under sections 105 and 105d

of the social welfare act, 1939 PA 280, MCL 400.105 and 400.105d.

(7) ~~(6)~~ The department shall, on an annual basis, reconcile

the amounts distributed under subsection (5) during each fiscal

year with the amounts actually collected for a particular fiscal

year and shall make any necessary adjustments, positive or

negative, to the amounts to be distributed for the next successive

calendar quarter that begins January 1. The state treasurer or his

or her designee shall annually provide to the operator of each

qualified airport a report of the reconciliation performed under

this subsection. The reconciliation report is subject to the

confidentiality restrictions and penalties provided in section

28(1)(f) of 1941 PA 122, MCL 205.28.

(8) ~~(7)~~ As used in this section:

(a) "Aviation fuel" means fuel as that term is defined in

section 4 of the aeronautics code of the state of Michigan, 1945 PA

327, MCL 259.4.

(b) "Qualified airport" means that term as defined in section

109 of the aeronautics code of the state of Michigan, 1945 PA 327,

MCL 259.109.

created in section 34(2) of the aeronautics code of the state of

Michigan, 1945 PA 327, MCL 259.34.

(d) "State aeronautics fund" means the state aeronautics fund

created in section 34(1) of the aeronautics code of the state of

Michigan, 1945 PA 327, MCL 259.34.

Enacting section 1. This amendatory act does not take effect

unless all of the following bills of the 98th Legislature are

enacted into law:

(a) Senate Bill No. 988.