jonathan ussery, assistant director local government services · sales tax collected by business ....

Georgia Department of Revenue

Jonathan Ussery, Assistant DirectorLocal Government Services

Division Operations

Distributions

Unclaimed Property


Distributions

Responsible for grants and tax distributions to local governments and school boards

•Sales Tax•Prepaid Wireless, NonPrepaid E-911 Fees•Fireworks Excise tax•IRP-Alternate Ad Valorem Tax•Forest Land Assistance Grants


MonthlySales Tax $520+ millionE-911 Prepaid Wireless Fee $ 3.5 million

(yearly distribution before January 2019)911 Fee Non-Prepaid $ 15 million

(began January 2019)Annual

IRP Alternate Ad Valorem Tax $ 16 million Forest Land Assistance Grants $ 40 millionFireworks Excise (5% of total) $ 75 thousand

Distributions to Local Entities –over $5.5 Billion annually


Sales Tax: Functions of LGS Division

Monthly:– Coordinate distribution of sales tax proceeds to local governments and

school boards– Verify accuracy of monthly distribution using Integrated Tax System (ITS)

Quarterly:– Publish local sales tax rates to the DOR website – Update ITS with current rates for accurate reporting– Post commodity sales data to the web

Ongoing:– Track effective dates and amount of tax distributed to local governments– Maintain list of local sales taxes that have been voted-on and passed – Assist local governments/state agencies with requests for data/research


Sales Tax -Relevant to Local Governments

L Local Option Sales Tax (LOST)H Homestead Option Sales Tax (HOST/EHOST)M MARTA Sales Tax (MARTA)S Special Purpose Local Option Sales Tax (SPLOST)T Transportation-regional, single-county, transit (TSPLOST/TSPLOST2)E Education Local Option Sales Tax (ELOST/ESPLOST) O Other: Municipal Local Option Sales Tax (MOST)

2nd LOST for Muscogee2nd LOST for Towns

http://www.bing.com/images/search?q=image+of+point+of+sale&id=4885B07CB66155D136AF92D7C008E32261FDF56A&FORM=IQFRBA


Sales Tax: Point of Delivery

Taxes are due based on ‘Point of Delivery’

‘Point of Sale’ data is notavailable


Sales Tax: Collection and Processing

• Tax collection cycle– Sales month (calendar) – January– Tax and Report due 20th – February– Distribution transferred to local governments/school

boards by last business day – February• State and local taxes are reported and paid together

– Reported distributions must equal payment

Sales Tax collected by business between January 1st and 31st, 2020)

Sales Tax Return filed and payment of collected sales taxremitted to DOR by 20th of the following month

February 20, 2020

Returns and payments processed by DOR Processing occurs from prior month closeout to current month

closeout: January 28 – February 25, 2020

Monthly closeout approximately 4 business days before month end

February 25, 2020

Monthly local option sales tax distributions electronically transmitted to bank approximately 3 business days before month

end February 26, 2020

Local sales tax distributions settle in county/city/school bank account approximately last business day of month

February 28, 2020


• Pro Rata distributions– Twice each year– Includes payments that cannot be processed, or

distribution point is unidentifiable– Less than ½ percent of total payments



• Distributions will differ among tax types (LOST. SPLOST, etc)

– Difference usually less than 3% per quarter– Caused by Use taxes, compliance (late or

underpayments), exemptions, and refund adjustments

• We can research an issue of unusual distributions on request



Sales Tax: Rates and Data

Rates and commodity data:

https://dor.georgia.gov/distributions-section

Distribution data:

https://gtc.dor.ga.gov

https://dor.georgia.gov/distributions-section

https://gtc.dor.ga.gov/


Sales Tax: Distribution Reports


Distributions


• Commodity report – Distributions data by major commodity group– North American Industry Classification System

(NAICS)– NAICS classification reported by taxpayer

Sales Tax: Commodity Report


Commodity Report


Local Option Sales Tax (LOST)

Authority: O.C.G.A. § 48-8-80 through 48-8-96

Purpose: County and qualifying municipalities share tax revenues to fund services

Distribution: Based on Certificates of Distribution signed by county and cities

147 counties impose a LOST (as of April 2020)


LOST: Qualifying Municipalities – O.C.G.A. § 48-8-80

• Must impose a tax and provide at least three of the following services:

Water Sewage Garbage collection Police Fire Library


LOST: Period of Imposition

• Imposed until voted to cease• Percentage of distribution between local

governments must be renegotiated every 10 years


LOST

• Food and beverages are taxable


Homestead Option Sales Tax(HOST / EHOST)


Purpose: to fund county services equal to revenues lost due to homestead exemptions and for capital outlay projects

Distribution: county only

2 counties impose HOST/EHOSTImposed until voted to cease


MARTA

Authority: MARTA Act, Georgia Laws, 1964, page 1008, continuation of amendment under Article XI, Section I, Paragraph IV(d) of the Georgia Constitution

Purpose: fund rapid transit

Distribution: MARTA only

3 counties/1 city impose MARTA tax (future additional counties possible)


Special Purpose Local Option Sales Tax (SPLOST)


Purpose: to fund capital outlay projects

Distribution: county only

154 counties impose a SPLOST (as of April 2020)Imposed for up to 6 years


– Each major project or use– Total dollar amount to be collected– Length of time the tax is to be levied– Certain information about general obligation debt, if

it is issued in conjunction with tax levy

SPLOST: Referendums must specify…


• Ceases at maximum dollar amount or time, whichever occurs first– Six-year levies are time only

• Must vote 80+ days from cessation to levy a new SPLOST without a break in collections

• Food and beverages are taxable (except Dekalb SPLOST)

SPLOST: Imposition Period


County and its cities can share proceeds:– Intergovernmental Agreement is signed by county

and cities– County must distribute to cities

Tax may be imposed for 6 years if:– Intergovernmental Agreements are signed, or– Certain county only Level 1 projects

SPLOST: Distribution made to County


• All tax proceeds must be accounted for by county and cities for each special project

• These funds cannot be commingled with other county or city revenues

• Interest earned on such revenues must be expended in the same manner as tax proceeds

• County and cities must report progress of projects annually in local newspaper

SPLOST: Auditing


Education Local Option Sales Tax (ELOST / ESPLOST)


Purpose: fund school system projects

Distribution: school systems only

158 counties impose an ELOST/ESPLOST (as of April 2020)Imposed for up to 5 years


Authority: O.C.G.A. § 48-8-240 through 48-8-269Purpose: Fund regional/local transportation projectsDistribution: Georgia State Financing and Investment

Commission (2013) – regional; direct to county/cities (2017) – single-county/city

89 counties/1 city impose TSPLOST64 counties-regional; 27 counties-single; 1 cityImposed for 10 years-regional/5 years-single county/city or until maximum dollar amount, whichever occurs first

Transportation Special Purpose Local Option Sales Tax (TSPLOST)


Authority: O.C.G.A. § 48-8-269.40 through 48-8-269.58

Purpose: Fund transit transportation projects (2019)

Distribution: county and cities based on Intergovernmental Agreement

No counties currently impose TRANSIT TSPLOST; Imposed for up to 30 years (possible Gwinnett-2020)

TRANSIT - Transportation Special Purpose Local Option Sales Tax (TSPLOST)


Authority: O.C.G.A. § 38-3-180 through 38-3-191 and 46-5-121 and 46-5-134.2

Purpose: Provide for imposition, collection and distribution of 9-1-1 charges

Distribution: 911, Wireless E-911-distributed based on collection (Non-Prepaid); Prepaid Wireless-Based on population (2012 - first distribution)

157 counties and 23 cities receive distribution (as of June 2020)

911, E-911 Fees


Distribution only to those counties and cities that:– Operate a public safety answering point (PSAP)– Impose by ordinance or resolution a prepaid

wireless charge of 75 cents per transaction (2012-2018), $1.50 per transaction (began 2019)

– File a copy of ordinance or resolution with the Department of Revenue, Office of Legal Affairs and Tax Policy

Prepaid Wireless E-911 Fees: Imposing the Fee


• Returns are filed and collections made through the Georgia Tax Center portal

• Audited, assessed and collected in same manner as sales tax

• Annual distribution by October 15th (2012-2018)• Monthly distribution (began 2019)

Prepaid Wireless 911 Fees: Collection and Distribution


Authority: O.C.G.A. § 48-5A-1 through 3

Purpose: Assistance grant to offset revenue loss from forest land conservation use valuation

Distribution: Annual

About $40 million distributed to local governments

Forest Land Protection Act Assistance Grants


• Application for FLPA funds by local governments made with county digest

• Funds appropriated by the legislature for upcoming fiscal year

• Payments begin after July 1– Funds allotted to Department of Revenue for

payment in small installments throughout the year by the Office of Planning and Budget

FLPA: Application


Example of distribution timeline:– Application made with 2019 Digest submission

approximately July-December 2019– Legislature appropriates funds early 2020 for

upcoming fiscal year 2021 (July 2020-June 2021)– FLPA funds begin being paid after July 1, 2020

FLPA: Distributions


Authority: O.C.G.A. § 40-2-156

Purpose: Provide for imposition, collection, and distribution of AAVT on commercial trucks registered under the International Registration Plan (IRP)

Distribution: Based on benchmark and vehicle ratio formula detailed in statute, First distribution August 1, 2015 – subsequent distributions in April each year.

About $16 million distributed to local governments

Alternative Ad Valorem Tax


Alternative Ad Valorem Tax (AAVT)

SB82 Amended OCGA 40-2-152 by providing for a new distribution formula for AAVT (Alternative Ad Valorem Tax) proceeds collected by DOR on IRP vehicles.

2014 collections: $15,948,039.74


AAVT: Vehicle Ratio Formula

Remaining funds after satisfying the benchmark distributed by the vehicle ratio formula: ($ 6,656,389.31)

1. Determine ratio of IRP vehicles registered statewide to those attributed to each county

2. Multiply ratio by funds available after benchmark3. Distribute based on the taxes levied ratio of each

qualified jurisdiction


Prior to 2020:AAVT distributed based on the qualified 2013 benchmark ad valorem tax ($9,132,170.06) for IRP vehicles

Year 2015 – 100% Year 2016 – 80%Year 2017 – 60%Year 2018 – 40%Year 2019 – 20%

Year 2020 – benchmark phased out

AAVT: Benchmark Formula


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Responsible for administering the “Disposition of Unclaimed Property Act” which includes tangible and intangible property that has remained unclaimed by the owner for more than the required holding period.

Unclaimed Property Program


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Unclaimed property refers to accounts held by financial institutions or other businesses who have lost contact with the owner of record. Unclaimed property includes, but is not limited to; wages, savings accounts, customer refunds, accounts payable, insurance payments, shares of stock, escrow funds, royalties and contents from safe deposit boxes. Most property is reported to the program after five years of inactivity.

What is Unclaimed Property?


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Unclaimed Property: Average Annual Collections and Claims

Securities $20 million

Unclaimed Funds $175 million

Claims paid $34 million

Safe Deposit Box contents

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jonathan ussery, assistant director local government services · sales tax collected by business ....

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