GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2001
S	1
SENATE BILL 596
     

 
Short Title:	State Gov. Sales Tax Exempt-AB.	()	
Sponsors:	Senator Kerr.	
Referred to:	Finance.	
March 22, 2001

A BILL TO BE ENTITLED
AN ACT to promote efficiency in state government by allowing a sales and use tax exemption for state agencies instead of a sales and use tax refund to state agencies.

The General Assembly of North Carolina enacts:
SECTION 1.  G.S. 105‑164.13 is amended by adding a new subdivision to read:
"§ 105‑164.13.  Retail sales and use tax.
The sale at retail, the use, storage or consumption in this State of the following tangible personal property is specifically exempted from the tax imposed by this Article: 
…
(47)	Items subject to sales and use tax under G.S. 105-164.4, other than items taxed under G.S. 105-164.4(a)(4a) and G.S. 105-164.4(a)(4c), if all of the following conditions are met:
a.	The items are purchased by a State agency.
b.	The items purchased are paid for by a check, credit card, procurement card, or credit account of the State agency.
c.	The items are purchased pursuant to a purchase order of the State agency signed by the person authorized to sign checks for the agency that contains the exemption number of the agency and a description of the property purchased."
SECTION 2.  G.S. 105‑164.14(c) reads as rewritten:
"(c)	Certain Governmental Entities. – A governmental entity listed in this subsection is allowed an annual refund of sales and use taxes paid by it under this Article, except under G.S. 105‑164.4(a)(4a) and G.S. 105‑164.4(a)(4c), on direct purchases of tangible personal property. Sales and use tax liability indirectly incurred by a governmental entity on building materials, supplies, fixtures, and equipment that become a part of or annexed to any building or structure that is owned or leased by the governmental entity and is being erected, altered, or repaired for use by the governmental entity is considered a sales or use tax liability incurred on direct purchases by the governmental entity for the purpose of this subsection. A request for a refund must be in writing and must include any information and documentation required by the Secretary. A request for a refund is due within six months after the end of the governmental entity's fiscal year.
This subsection applies only to the following governmental entities:
(1)	A county.
(2)	A city as defined in G.S. 160A‑1.
(2a)	A consolidated city‑county as defined in G.S. 160B‑2.
(2b)	A local school administrative unit.
(3)	A metropolitan sewerage district or a metropolitan water district in this State.
(4)	A water and sewer authority created under Chapter 162A of the General Statutes.
(5)	A lake authority created by a board of county commissioners pursuant to an act of the General Assembly.
(6)	A sanitary district.
(7)	A regional solid waste management authority created pursuant to G.S. 153A‑421.
(8)	An area mental health, developmental disabilities, and substance abuse authority, other than a single‑county area authority, established pursuant to Article 4 of Chapter 122C of the General Statutes.
(9)	A district health department, or a public health authority created pursuant to Part 1A of Article 2 of Chapter 130A of the General Statutes.
(10)	A regional council of governments created pursuant to G.S. 160A‑470.
(11)	A regional planning and economic development commission or a regional economic development commission created pursuant to Chapter 158 of the General Statutes.
(12)	A regional planning commission created pursuant to G.S. 153A‑391.
(13)	A regional sports authority created pursuant to G.S. 160A‑479.
(14)	A public transportation authority created pursuant to Article 25 of Chapter 160A of the General Statutes.
(14a)	A facility authority created pursuant to Part 4 of Article 20 of Chapter 160A of the General Statutes.
(15)	A regional public transportation authority created pursuant to Article 26 of Chapter 160A of the General Statutes, or a regional transportation authority created pursuant to Article 27 of Chapter 160A of the General Statutes.
(16)	A local airport authority that was created pursuant to a local act of the General Assembly.
(17)	A joint agency created by interlocal agreement pursuant to G.S. 160A‑462 to operate a public broadcasting television station.
				(22)	A regional natural gas district created pursuant to Article 28 of Chapter 160A of the General Statutes."
SECTION 3.  G.S. 105‑164.14(e) reads as rewritten:
"(e)	State Agencies. – The State is allowed quarterly refunds of local sales and use taxes paid indirectly by the State agency on building materials, supplies, fixtures, and equipment that become a part of or annexed to a building or structure that is owned or leased by the State agency and is being erected, altered, or repaired for use by the State agency. 
A person who pays local sales and use taxes on building materials or other tangible personal property for a State building project shall give the State agency for whose project the property was purchased a signed statement containing all of the following information:
(1)	The date the property was purchased.
(2)	The type of property purchased.
(3)	The project for which the property was used.
(4)	If the property was purchased in this State, the county in which it was purchased.
(5)	If the property was not purchased in this State, the county in which the property was used.
(6)	The amount of sales and use taxes paid.
If the property was purchased in this State, the person shall attach a copy of the sales receipt to the statement. A State agency to whom a statement is submitted shall verify the accuracy of the statement.
Within 15 days after the end of each calendar quarter, every State agency shall file with the Secretary a written application for a refund of taxes to which this subsection applies paid by the agency during the quarter. The application shall contain all information required by the Secretary. The Secretary shall credit the local sales and use tax refunds directly to the General Fund."
SECTION 4.  Part 5 of Article 5 of Chapter 105 of the General Statutes is amended by adding a new section to read:
"§ 105-164.29A.  State government exemption process.
(a)	Application. – To be eligible for the exemption provided in G.S. 105-164.13(47), a State agency must obtain from the Department of Revenue a sales tax exemption number. The application for exemption must be in the form required by the Secretary, be signed by the State agency's head, and contain any information required by the Secretary. The Secretary must assign a sales tax exemption number to a State agency that submits a proper application. 
(b)	Liability. – A State agency that does not use the items purchased with its exemption number must pay the tax that should have been paid on the items purchased, plus interest calculated from the date the tax would otherwise have been paid."
SECTION 5.  Section 4 of this act becomes effective January 1, 2002.  The remainder of this act becomes effective July 1, 2002, and applies to sales made on or after that date.