2019 -- S 0131

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2019

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A N   A C T

RELATING TO TAXATION -- PUBLIC SERVICE CORPORATION TAX

     

     Introduced By: Senators Archambault, Rogers, Quezada, and Gallo

     Date Introduced: January 24, 2019

     Referred To: Senate Finance

     It is enacted by the General Assembly as follows:

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     SECTION 1. Section 44-13-13 of the General Laws in Chapter 44-13 entitled "Public

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Service Corporation Tax" is hereby amended to read as follows:

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     44-13-13. Taxation of certain tangible personal property.

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     The lines, cables, conduits, ducts, pipes, machines and machinery, equipment, and other

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tangible personal property within this state of telegraph, cable, and telecommunications

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corporations and express corporations, used exclusively in the carrying on of the business of the

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corporation shall be exempt from local taxation; provided, that nothing in this section shall be

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construed to exempt any "community antenna television system company" (CATV) from local

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taxation; and provided, that the tangible personal property of companies exempted from local

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taxation by the provisions of this section shall be subject to taxation in the following manner:

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     (1) Definitions. Whenever used in this section and in §§ 44-13-13.1 and 44-13-13.2,

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unless the context otherwise requires:

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     (i) "Average assessment ratio" means the total assessed valuation as certified on tax rolls

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for the reference year divided by the full market value of the valuation as computed by the Rhode

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Island department of revenue in accordance with § 16-7-21;

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     (ii) "Average property tax rate" means the statewide total property levy divided by the

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statewide total assessed valuation as certified on tax rolls for the most recent tax year;

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     (iii) "Company" means any telegraph, cable, telecommunications, or express company

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doing business within the state of Rhode Island;

 

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     (iv) "Department" means the department of revenue;

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     (v) "Population" shall mean the population as determined by the most recent census;

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     (vi) "Reference year" means the calendar year two (2) years prior to the calendar year

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preceding that in which the tax payment provided for by this section is levied;

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     (vii) "Value of tangible personal property" of companies means the net book value of

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tangible personal property of each company doing business in this state as computed by the

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department of revenue. "Net book value" means the original cost less accumulated depreciation;

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provided, that no tangible personal property shall be depreciated more than seventy-five percent

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(75%) of its original cost; and provided, further, that the accumulated depreciation reduction shall

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take into account physical deterioration, functional obsolescence, and economic obsolescence

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determined in accordance with generally accepted property tax valuation principles.

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     (2) On or before March 1 of each year, each company shall declare to the department, on

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forms provided by the department, the value of its tangible personal property in the state of

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Rhode Island on the preceding December 31.

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     (3) On or before April 1, 1982 and each April 1 thereafter of each year, the division of

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property valuation shall certify to the tax administrator the average property tax rate, the average

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assessment ratio, and the value of tangible personal property of each company.

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     (4) The tax administrator shall apply the average assessment ratio and the average tax rate

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to the value of tangible personal property of each company and, by April 15 of each year, shall

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notify the companies of the amount of tax due. For each filing relating to tangible personal

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property as of December 31, 2008 and thereafter the tax rate applied by the tax administrator shall

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be not less than the rate applied in the prior year.

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     (5) The tax shall be due and payable within sixty (60) days of the mailing of the notice by

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the tax administrator. If the entire tax is not paid to the tax administrator when due, there shall be

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added to the unpaid portion of the tax, and made a part of the tax, interest at the rate provided for

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in § 44-1-7 from the date the tax was due until the date of the payment. The amount of any tax,

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including interest, imposed by this section shall be a debt due from the company to the state, shall

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be recoverable at law in the same manner as other debts, and shall, until collected, constitute a

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lien upon all the company's property located in this state.

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     (6) The proceeds from the tax shall be allocated in the following manner:

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     (i) Payment of reasonable administrative expenses incurred by the department of revenue,

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not to exceed three quarters of one percent (.75%), the payment to be identified as general

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revenue and appropriated directly to the department;

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     (ii) The remainder of the proceeds shall be deposited in a restricted revenue account and

 

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shall be apportioned to the cities and towns within this state on the basis of the ratio of the city or

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town population to the population of the state as a whole. Estimated revenues shall be distributed

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to cities and towns by July 30 and may be recorded as a receivable by each city and town for the

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prior fiscal year.

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     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO TAXATION -- PUBLIC SERVICE CORPORATION TAX

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     This act would provide that a reduction for accumulated depreciation in connection with

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the calculation of the net book value of a company's tangible personal property, would take into

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account physical deterioration and functional and economic obsolescence determined in

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accordance with generally accepted property tax valuation principles.

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     This act would take effect upon passage.

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