Chapter XII
Finance
Cindy Avrette, Trina Griffin, Mary Shuping
and others (See references by initials on page ??? of this publication.)

Enacted Legislation

One-Time Rental Car Tax Election Exception
S.L. 2003-5 (SBl 235) allows a retailer who leases motor vehicles to elect to begin paying the highway use tax on the gross receipts derived from leasing the vehicles even though the retailer has previously paid the 3% highway use tax on these vehicles.  The retailer’s election to begin paying the gross receipts tax must have been made by July 1, 2003, and if made, is irrevocable.  The election does not relieve the retailer of liability from a tax previously imposed.
This act became effective March 28, 2003.  (MS)
IRC Update
S.L. 2003-25 (HB 320) rewrites the definition of the Internal Revenue Code used in State tax statutes to change the reference date from May 1, 2002 to January 1, 2003.  Part XXXVII-A of S.L. 2003-284 updated the reference date to June 1, 2003.  Updating the Internal Revenue Code reference makes recent amendments to the Code applicable to the State to the extent that State law previously tracked federal law.
This act became effective April 24, 2003.  (MS)
Deterring SUTA Dumpting
S.L. 2003-67 (SB 326).  See Labor & Employment.
Modify County Tax Certification Authority
S.L. 2003-72 (HB 393) provides that a register of deeds serving in a county where tax collector certification of a deed is normally required prior to registration must accept an uncertified deed if the closing attorney states the intent to pay any delinquent taxes from the closing proceeds. It also adds Hyde County to the list of counties that have the authority to require tax certification of a deed prior to registration.
This act became effective May 20, 2003.  (MH)
Publish Revenue-Neutral Property Tax Rate
S.L. 2003-264 (SB 511) requires a county, in the year in which it conducts a general reappraisal of property, to include in its budget a statement of the revenue-neutral property tax rate for the budget.  The revenue-neutral tax rate is the rate that is estimated to produce revenue for the next fiscal year equal to the revenue that would have been produced for the next fiscal year by the current tax rate if no reappraisal had occurred.  To calculate the revenue-neutral tax rate, the budget officer must first determine a rate that would produce revenues equal to those produced for the current fiscal year and then increase the rate by a growth factor equal to the average annual percentage increase in the tax base due to improvements since the last general reappraisal.  This growth factor should represent the expected percentage increase in the value of the tax base due to improvements during the next fiscal year.  The budget officer must further adjust the rate to account for any annexation, deannexation, merger, or similar event.
This act became effective June 26, 2003.  (TG)
2003 Budget Act
S.L. 2003-284, Parts 37.1 through 47.1 (HB 397, Parts 37.1 through 47.1) make the following finance law changes (TG): 

Part  #	Description and Effective Dates	Fiscal Impact	
37	Adjust Local Government Hold‑Harmless
Effective June 30, 2003, changed the date that sales tax hold‑harmless payments are made to local governments each year, from September 15 to August 15. It also provided that the payments will be made in 2003 and 2004, with intent language for the payments to continue through 2012. This part also provided that the estimates used to calculate the hold‑harmless payments must be updated to reflect legislative changes.	No significant fiscal impact on the General Fund in the 2003‑05 fiscal biennium.	
37-A	Update Internal Revenue Code Reference and Adjust Bonus Depreciation and Estate Tax
Effective June 30, 2003, changed the State tax law reference to the Internal Revenue Code from January 1, 2003 to June 1, 2003. In May 2003, Congress enacted the Jobs and Growth Tax Relief Reconciliation Act of 2003. That legislation increased from 30% to 50% the bonus depreciation allowance originally enacted in March 2002 in response to the September 11 terrorist attacks and moved the sunset for bonus depreciation from September 10, 2004 to December 31, 2004. In addition, the package increased the amount of investment in capital equipment that a business can expense during the acquisition year (instead of depreciating over many years) from $25,000 to $100,000.
Continued technical conformity to bonus depreciation so that taxpayers do not have to keep a separate depreciation schedule for State tax purposes for each piece of equipment in addition to the federal schedule. 
Extended until July 1, 2005, the partial conformity of the State estate tax to changes in the federal estate tax. 	
The update in the Code reference fully conforms North Carolina law to the federal expensing limit increase at a cost to the General Fund of $29.2 million in FY 2003-04 and $18.0 million in FY 2004-05.

This will reduce state revenues in FY 2003-04 by $40.8 million (due to the increase in bonus depreciation from 30% to 50%) but increase revenues by $18.0 million in FY 2004-05.
This provision has no impact for the 2003-04 fiscal year because estates have 9 months after a death to file a return. For FY 2004-05, the proposal saves $70.8 million of General Fund revenue that would have disappeared if the 2002 partial conformity had been allowed to sunset on January 1, 2004.	
38	Temporarily Maintain State Sales Tax Rate
Effective June 30, 2003, extended sunset on the half-cent state sales tax enacted in 2001 from July 1, 2003 to July 1, 2005.	Joint estimates provided by Fiscal Research and the Office of State Management and Budget suggest the following revenue stream from this tax extension.
FY 2003-04	$341.7 million
FY 2004-05	$388.2 million
FY 2005-06	$26.5 million	
39	Temporarily Maintain Upper Income Tax Rate
Effective June 30, 2003, extended the sunset of the 8.25% individual income tax bracket from January 1, 2004 to January 1, 2006.	The additional revenue from this extension is calculated using the North Carolina Individual Income Tax Model. The model estimates that $83.3 million in individual income tax payments will be generated in tax year 2004 and $104.2 million in revenue in tax year 2005. This revenue is divided into fiscal years as follows:
FY 2003-2004:  $37.5 million
FY 2004-2005:  $92.7 million
FY 2005-2006:  $57.3 million	
39-B	Conform Child Tax Credit to Federal Credit
Effective for the 2003 tax year, conformed the State definition of a dependent child to the federal definition for purposes of the individual income tax credit for children.	The change will increase General Fund revenue by $16.8 million in FY 2003-04 and by $17 million in FY 2004-05.	
43	Equalize Insurance Tax Rates on Article 65 Corporations
Raised the insurance premiums tax rate on Article 65 corporations from 1.0% to 1.9%, effective for the 2004 tax year. In addition, for the 2004 and 2005 tax years, this act required the affected companies to make estimated tax payments in April and June of each year equal to 50% of the annual liability for that tax year.	This change will increase General Fund revenue by $18.6 million for the 2003-04 fiscal year and $13.9 million for FY 2004-05. 	
43-A	Clarify Property Tax Exclusion for Property Used to Reduce Cotton Dust
Clarified a property tax exclusion	No impact on General Fund. No estimate on the fiscal impact on local governments is possible, but the impact is expected to be small.	
44	Continue Use Tax Line Item on Income Tax Form
Effective June 30, 2003, this act extended for two years the law that provides that consumer use tax is payable on the individual income tax return.	This extension will increase General Fund revenue by $3.1 million in both FY 2003-04 and FY 2004-05.	
45	Conform to Streamlined Sales and Use Tax Agreement
This act made numerous changes to the sales and use tax statutes to bring North Carolina into conformity with the Streamlined Sales Tax Agreement. Various effective dates.	The tax on soft drinks will increase sales tax revenues by $41.4 million in FY 2003-04 and by $45.1 million in FY 2004-05. Conversely, the 50% vending machine exemption will reduce sales tax revenue by $4.05 million in FY 2003-04 and $8.6 million in FY 2004-05. The tax on prepared food will increase revenue by $3.05 million in FY 2003-04 and by $3.3 million in FY 2004-05. The candy exemption will reduce revenue by $400,000 in FY 2003-04 and by $800,000 in FY 2004-05.	
45-A	Eliminate Tobacco and Alcohol Discounts
Effective August 1, 2003, eliminated tax reductions that were allowed to distributors and wholesalers who pay the excise taxes on cigarettes and other tobacco products.
Effective August 1, 2003, eliminated tax reductions that were allowed to distributors and wholesalers who pay the excise taxes on wine, beer, and spirituous liquor.	
The change will increase General Fund revenue by $1.74 million in FY 2003-04 and by $1.9 million in FY 2004-05.
The change will increase General Fund revenue by $3.67 million in FY 2003-04 and by $4.0 million in FY 2004-05. 	
46	Repairs and Renovations
Effective July 1, 2003, enacts the procedural and regulatory provisions governing the State's issuance of security interest indebtedness. It also provides the specific legislative authorization for up to $300 million of special indebtedness to be used for the repair and renovation of State facilities and related infrastructure.	
The expected debt service is $35 million for 2004-05, $32.5 million for 2005-06, and $31.6 million for 2006-07.
	
46-A	State Capital Facilities Finance
Effective July 1, 2003, provides specific legislative authorization for three projects:
The purchase of two private prisons currently leased by the State. 

Up to $6,780,000 for the design, construction drawings, and solicitation of bids for three youth development centers.
The construction of a structural pest control training facility to be located at NCSU.	
The amount of the issuance is to be negotiated. No other fiscal information available.
No fiscal information available, in planning stage.

No fiscal information available.

47	Lease-Purchase Three New Prisons
Effective July 1, 2003, provides specific legislative authorization for the lease-purchase of three new prisons.	
The cost of constructing the prisons is expected to be between $344 and $364 million. The annual operating cost is expected to be $18 million.	

Waive Deadlines for Troops
S.L. 2003-300 (SB 936).  See Military, Veterans', & Indian Affairs.
Psychiatric Hospital Financing
S.L. 2003-314 (HB 684), as amended by S.L. 2003-284, Part 46-A (House Bill 397, Part 46-A), authorizes the issuance of up to $110 million in security interest debt to finance the acquisition, construction, and equipping of an approximately 450,000 square foot, 432‑bed new psychiatric hospital to be located in Butner.  The act also enacts the procedural and regulatory provisions governing the State's issuance of security interest indebtedness by creating the "State Capital Facilities Financing Act".  Security interest indebtedness is debt that is secured by an interest in the property being financed, repaired, or renovated.  The act uses the term "special indebtedness" to cover the three forms that this type of debt can take:  installment purchase, lease-purchase, and bonds.  In each case, the debt is non-voted. 
This act became effective July 10, 2003.  (CA)
Water and Sewer Authority Setoff
S.L. 2003-333 (SB 529) The act adds water and sewer authorities to the Setoff Debt Collection Act, under which the Department of Revenue diverts part or all of an individual's income tax refund to pay a debt the individual owes to a State or local agency.  Thus, the debt the individual owes the agency is set off against the individual's income tax refund. Before January 1, 2000, the setoff program was open only to State agencies.  Now, counties and municipalities participate through a clearinghouse that submits debts on their behalf to the Department of Revenue. The clearinghouse was established pursuant to an interlocal agreement adopted under Article 20 of Chapter 160A of the General Statutes.
This act becomes effective January 1, 2004, and applies to income tax refunds determined on or after that date.  (MW)
Revenue Administrative Changes
S.L. 2003-349 (SB 236) makes the following changes to the revenue laws:
•	It modifies the dividends received deduction for regulated investment companies and real estate investment trusts to ensure that all dividends are treated uniformly, effective for taxable years beginning on or after January 1, 2003, as recommended by the Revenue Laws Study Committee.
•	It amends the reporting requirements regarding sales of seized property by the Secretary of Revenue to avoid duplicative filing of reports, as recommended by the Revenue Laws Study Committee.
•	It extends until October 1, 2005, the Department of Revenue's authority to continue using private collection agencies for the collection of in‑state tax debts, as recommended by the Revenue Laws Study Committee.
•	It revises the secrecy provision regarding the disclosure of tax information to reflect the transfer of certain functions and personnel from the Division of Motor Vehicles to the Division of the State Highway Patrol of the Department of Crime Control and Public Safety, as recommended by the Revenue Laws Study Committee.
•	It ensures that the monthly distribution of local sales and use tax proceeds is based on taxpayer data from filed returns, effective July 1, 2003, as recommended by the Revenue Laws Study Committee.
•	It simplifies the process for making the local sales tax hold‑harmless calculation by requiring the Department of Revenue, rather than the Office of State Budget and Management, to make the required projection of estimated tax proceeds, as recommended by the Revenue Laws Study Committee. 
•	It clarifies that the $20 filing fee for corporate annual reports is nonrefundable, as recommended by the Revenue Laws Study Committee. 
•	It clarifies the Research and Development tax credit, as requested by the Department of Commerce and the Department of Revenue.
•	It directs the Revenue Laws Study Committee to form a group of tax professionals to work with the Department of Revenue to gather appropriate data to support an estimate of the fiscal impact of allowing corporations to file consolidated tax returns.
•	It makes various changes to the motor fuel laws, as requested by the Motor Fuels Tax Division of the Department of Revenue. These changes include technical changes, conforming changes, and substantive changes.
•	It codifies the administrative practice of allowing municipalities that sell electricity to exempt from their gross receipts for sales tax purposes those customer accounts that have been determined to be worthless. The sales tax law clearly allows this exemption for other taxpayers
Except as otherwise provided, the act became effective July 27, 2003.  (MH)
Modify UNC Bond Law
S.L. 2003-357 (SB 633) modifies the special obligation bond law that applies to The University of North Carolina system. It makes the maximum maturity for special obligation bonds more consistent with other University debt obligations by increasing the maximum maturity of special obligation bonds from 25 years to 30 years. It also increases the maximum maturity for special obligation bond notes from 2 years to 30 years, which provides UNC with greater flexibility to provide interim financing at lower costs.
This act became effective August 1, 2003.  (MH)
UNC – Nonappropriated Capital Projects
S.L. 2003-360 (SB 705) authorizes the construction of numerous projects by The University of North Carolina. The projects will be financed through revenue bonds and special obligation bonds. No funds from the General Fund will be appropriated to finance the projects. In addition to bond‑financing, the act authorizes the construction and financing of three capital projects at UNC‑Chapel Hill through lease arrangements with nonprofit corporations.
This act became effective August 1, 2003.  (MH)
Modify State Financing Laws
S.L. 2003-388 (SB 679) makes the following changes to the State public financing laws, as requested by the State Treasurer's Office:
•	Authorizes the use of out-of-state banks as well as in-state banks as trustee under a revenue bond order or a trust agreement securing revenue bonds
•	Allows term bonds with sinking fund redemptions to satisfy the statutory requirements for maturities
•	Exempts refunding bonds from the "four times" rule
•	Allows local governments to use installment purchase debt to refinance debt for purposes for which installment debt is currently authorized
•	Clarifies and regulates the authority of a local government to enter into an interest rate swap agreement in connection with bond issuance 
This act became effective August 7, 2003.  (CA)
Property Tax Certification Procedure
S.L. 2003-399 (HB 972).  See Technology.

Manufactured Housing
S.L. 2003-400, Sec. 4 and 13 through 16 (HB 1006, Sec. 4 and 13 through 16) makes changes to the property tax laws and the sales and use tax laws.  Section 4 expands the definition of manufactured homes that qualify as real property under the property tax laws to include manufactured homes on land leased by the manufactured homeowner for a term of at least 20 years and where the lease expressly provides for disposition of the manufactured home upon termination of the lease.  This change makes it easier for the owners of manufactured homes placed on the leased land to qualify for Freddie Mac mortgages.  Sections 13 through 16 impose a 2.5% sales and use tax rate on the sales price of each modular home.  This replaces the current practice of applying two different sales tax rates based on whether the modular home is built on a steel frame or a wood frame.  This change in sales and use tax treatment of modular homes was proposed by the North Carolina Manufactured Housing Institute (NCMHI) and approved by the Department of Revenue.  Both the NCMHI and the Department agreed that the change would simplify the administration of sales and use tax on modular home transactions.  The act does not amend the sales and use tax treatment of manufactured homes  
Section 4 became effective August 7, 2003. Sections 13 through 16 become effective January 1, 2004, and apply to sales of modular homes on and after that date. (MW)
Wine Shippers Permit
S.L. 2003-402 (SB 668) remedies an unconstitutional exception in the State's ABC laws that allowed only in-state wineries to ship wine to North Carolina residents. The United States Court of Appeals for the Fourth Circuit recently held that the exception violated the Commerce Clause of the United States Constitution; the court left the task of fashioning the appropriate remedy to the General Assembly. This act creates a new permit under the ABC laws that would allow any winery to ship wine directly to individuals in North Carolina and it provides a mechanism for the collection of excise and sales and use taxes on direct shipments of wine.
This act becomes effective October 1, 2003.  (CA)
Local Option Project Development Financing
S.L. 2003-403 (SB 725) will permit the voters of the State to vote on a constitutional amendment in November 2004 that would allow the General Assembly to enact general laws authorizing counties, cities, and towns to borrow money, without voter approval, to finance the public portion of certain economic development projects within a defined territorial area. This development tool, generally known as tax increment financing but referred to as "project development financing" in the act, would allow local governments to set aside the additional property taxes that are generated by a new investment to pay for public facilities that support that new investment. The financing, issued in the form of bonds or other debt instruments, could be used for airports, auditoriums and arenas, hospitals, museums, parking facilities, sewer systems, storm sewers and flood control facilities, water systems, street improvements, public transportation facilities, railroads, affordable housing, land development for industrial or commercial purposes, utilities, and redevelopment. Redevelopment includes purchasing and improving property to help local redevelopment commissions. The bonds may also be issued for municipal service district projects.
This act became effective August 7, 2003. However, the Constitutional amendment and the corresponding statutory changes would become effective upon certification of the passage of the constitutional amendment by the Secretary of State. (TA)
ESC Surtax Delay
S.L. 2003-405 (HB 1241) states that the 20% surtax on employer unemployment insurance contributions will not be imposed as long as the Unemployment Insurance Fund balance is at or below $500 million. When the contributions replenish the Fund balance to $500 million, then the 20% surtax will be triggered to start refilling the Reserve Fund. When the Reserve Fund reaches $163 million, the surtax will trigger back off. The intended effect is that the 20% surtax, originally scheduled to go into effect January 1, 2004, because the balance in the Reserve Fund is under $163 million, will not be imposed during the 2004 calendar year.
This act became effective August 12, 2003.  (MW)
Qualified Business Credit/Ports Credit
S.L. 2003-414 (HB 1294) extends the sunset on the State Ports Tax Credit from 2004 to 2009 and amends the Qualified Business Investment Tax Credits as follows:
•	Extends the sunset from 2004 to 2007. 
•	Expands the definition of a qualified grantee business to include those that receive grants from entities such as MCNC‑Research and Development Institute, a nonprofit corporation formed to enhance economic development in North Carolina through applied research and technology development and commercialization of these technologies. 
•	Adds a new type of qualified business: a small business that is commercializing technology developed by a research university
The extension of the sunset on the State Ports Tax Credit becomes effective for taxable years beginning on or after January 1, 2004, and the remainder of the act became effective August 14, 2003.  (MS)
Expand Historic Preservation Credit
S.L. 2003-415 (SB 119) amends the historic preservation tax credit as follows:
•	It extends the sunset on the provision that permits a pass-through entity to allocate among its owners the tax credit for income-producing property from January 1, 2004, to January 1, 2008.
•	It amends the above-described provision to permit a pass-through entity to allocate the credit to an owner if an owner's adjusted basis in the pass-through entity is at least 40% of the amount of the credit allocated to that owner.
The act also directs the Department of Revenue to modify the income tax forms to provide separate lines for each tax credit claimed by the taxpayer
This act became effective July 10, 2003.  (CA)
Revenue Laws Technical Changes
S.L. 2003-416 (SB 97) makes technical and clarifying changes to the revenue laws and related statutes.
This act became effective August 14, 2003.  (CA)

Economic Development District
S.L. 2003-418 (SB 168) authorizes counties to create special tax areas under Section 2(4) of Article V of the North Carolina Constitution. These areas, called economic development and training districts, would be for the purpose of providing a skills training center to prepare county residents to perform manufacturing, research and development, and related service and support jobs in the pharmaceutical, biotech, life science, chemical, telecommunications, and electronics industries. A county may levy property taxes within the district, in addition to those levied throughout the county, in order to finance the skills training center. The act also defines the property that may be initially included within an economic development and training district located in Johnston County should the board of commissioners of Johnston County elect to establish one. The act states that a municipality cannot annex property within a district located in Johnston County
This act became effective August 14, 2003.  (MH)
State Government Sales Tax Exemption/School Cooperative Refund
S.L. 2003-431 (SB 100) allows a sales and use tax exemption, instead of a sales and use tax refund, for purchases by State agencies. The act also allows a refund of State and local sales and use taxes by a joint agency created by interlocal agreement among local school administrative units to jointly purchase food service-related materials, supplies, and equipment on their behalf
The exemption from State and local sales and use tax for State agencies becomes effective July 1, 2004.  The refund of State and local sales and use taxes for school board cooperatives became effective for taxes paid on or after July 1, 2003.  (TG)
Major Pending Legislation
Amend Franchise Tax Loophole
SB 51 (2nd Edition) would make the following changes to 2001‑2002 legislation that established attribution rules intended to close a loophole that allows corporations to escape franchise tax by transferring assets to a controlled limited liability company (LLC).  
•	Limit attribution rules to assets owned by LLCs that are not treated as partnerships for federal income tax purposes. No attribution is required if the LLC is treated as a partnership.
•	Attribute only a proportion of a related entity's LLC assets to the corporation, rather than all of the assets.
•	Simplify and correct the definition of indirect ownership, which is the test for determining whether an LLC's assets are attributable to a corporation.
•	Remove attribution for "related members" that are not related entities, thereby excluding relationships of less than 50% (was less than 20%) stock ownership between parties.
•	Provide for attribution of assets owned through business trusts, and clarifies attribution for assets owned by partnerships and related entities.
•	Correct definition of related entity and remove membership in the LLC as an additional condition for attribution.
•	Clarify that an adjustment is allowed to avoid any potential double taxation.
•	Create an exception to the attribution requirement for related parties if the corporation can demonstrate that the LLC does not own any assets that were previously owned or used by the corporation.
The bill is in the Senate for concurrence in the House changes.  A conference committee has been appointed.
Life Sciences Revenue Bond
SB 75 (2nd Edition, as amended) would create a Life Sciences Revenue Bond Authority in the Department of State Treasurer. It is step one of a two‑step process. First, the Authority will study the best method for establishing a credit enhancement program for construction of infrastructure for life sciences manufacturing facilities. One example of a credit enhancement vehicle would be revenue bonds. After the Authority reports its findings and recommendations to the General Assembly, the bill anticipates that in the second stage the Authority would administer any program enacted by the General Assembly. 
As amended by the House, it would set aside money from the collections assistance fee to establish a central taxpayer telecommunications service center for collections and assistance and it would encourage the Golden L.E.A.F., Inc. to promote the biopharmaceutical industry by investing in the establishment of a biopharmaceutical manufacturing training facility, a graduate-level bioprocessing research institute at NCSU and NCCU, and resource and training facilities at six regional community colleges.  The House amendment would also allocate money for the planning phase of the following projects:
•	A bioinformatics building at UNC-Charlotte
•	A cardiovascular Disease Institute at East Carolina University
•	A facility for the new college of education and allied professions at Western Carolina University
•	A student convocation & conference center at UNC-Asheville
•	A new cancer treatment facility at UNC-Chapel Hill
The bill is in the Senate for concurrence with the House amendments.  A conference committee has been appointed.
Special Obligation Debt/Purposes
SB 137 (2nd Edition as amended) would authorize municipalities to define a service district for transit-oriented development and it would expand local governments' existing authority to issue special obligation bonds for solid waste, water, and sewer projects to projects within a municipal service district. The House amendment would have added various technical and clarifying changes to the general statutes.  The bill is in the Senate for concurrence in the House amendments.  A conference committee has been appointed.
Economic Incentives/Committee Changes
SB 944 (2nd Edition) would expand the membership of the Revenue Laws Study Committee from 16 to 18 and would authorize an annual refund of State and local sales taxes paid on construction materials and fixtures for facilities that involve the investment of more than $100 million by the taxpayer and are primarily used for any of the following industries:
•	Aircraft Manufacturing
•	Bioprocessing
•	Motor Vehicle Manufacturing
•	Pharmaceutical and Medicine Manufacturing
•	Semiconductor Manufacturing
The bill is in the House Finance Committee.
Technical Corrections Act
HB 281 (6th Edition, Sec. 110) would authorize the issuance of up to $180 million of special indebtedness to finance the cost of a new cancer treatment facility within the University of North Carolina Health Care System to replace the North Carolina Clinical Cancer Center.  The bill is in the House for concurrence in the Senate changes.  A conference committee has been appointed.
No Sales Tax on Certain Free Publications
HB 1149 (2nd Edition) would exempt from the sales and use tax paper, ink, and other tangible personal property used by commercial printers and publishers to print free distribution periodicals and the sales by printers of these free distribution periodicals to the publishers. The bill is in the Senate Finance Committee.
Nonprofits Exempt From Admissions Tax 
HB 1303 (2nd Edition, as amended) would exempt the following amusement from the 3% privilege tax on gross receipts: a youth athletic contest with an admission price that does not exceed $5.00 and that is sponsored by a person exempt from income tax. A "youth athletic contest" is defined as a contest in which each participating athlete is less than 19 years of age. The Senate amendment changed the effective date from July 1, 2003, to October 1, 2003.  The bill is in the House for concurrence in the Senate amendment.  It is waiting to be calendared pursuant to Rule 36(b).
NC Travel and Tourism Investment Act
HB 1316 (4th Edition) would create the Travel and Tourism Capital Investment Program. The Program would award grants to the owners of qualified projects for the purpose of inducing the creation of new or the expansion or renovation of existing travel and tourism projects. The bill is in the Senate Finance Committee.
Studies
Referrals to Existing Commissions/Committees

	S.L. 2003-284, Sec. 11.7 (HB 397, Sec. 11.7) directs the Property Tax Subcommittee of the Revenue Laws Study Committee to study the positive and negative impacts of the acquisition of land by the State and non-profit organizations for conservation purposes on local government ad valorem tax revenues.  The Subcommittee must report its findings to the Joint Legislative Commission on Governmental Operations, the Revenue Laws Study Committee, and the Fiscal Research Division.

	S.L. 2003-349 (SB 236) authorizes the Revenue Laws Study Committee to establish a study group to gather data necessary to conduct an analysis of the potential revenue impact of modifying the corporate income tax law to require consolidated returns.

	S.L. 2003-432 (HB 754) directs the Revenue Laws Study Committee to study local government ordinances amortizing off premises outdoor advertising.