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                  HB 169
              BUILDING AUTHORITY AMENDMENTS
              1996 GENERAL SESSION
              STATE OF UTAH
              Sponsor: Brent H. Goodfellow
          AN ACT RELATING TO SPECIAL DISTRICTS; ALLOWING A PUBLIC BODY TO
          SUBLEASE PROPERTY TO A PRIVATE PARTY UNDER CERTAIN CONDITIONS;
          EXEMPTING PROPERTY AND RENTAL INCOME OF A BUILDING AUTHORITY
          FROM CORPORATE FRANCHISE TAX; MAKING TECHNICAL CORRECTIONS; AND
          PROVIDING AN EFFECTIVE DATE.
          This act affects sections of Utah Code Annotated 1953 as follows:
          AMENDS:
          17A-3-907 , as renumbered and amended by Chapter 186, Laws of Utah 1990
          17A-3-913 , as renumbered and amended by Chapter 186, Laws of Utah 1990
          Be it enacted by the Legislature of the state of Utah:
              Section 1. Section 17A-3-907 is amended to read:
              17A-3-907. Leasing contract provisions authorized.
              (1) A leasing contract may provide, as part of the lease rental for the leased property, that
          the lessee shall:
              (a) pay all taxes and assessments levied against or on account of the leased property or
          rentals from it;
              (b) maintain insurance on the leased property for the benefit of the building authority and
          the holders of its bonds; and
              (c) assume all responsibility for repair, replacement, alterations, or improvements to the
          leased property during the term of the lease.
              (2) A leasing contract may provide that the public body may sublease all or specified
          portions of a project to:
              (a) [other] another public [bodies,] body;
              (b) the state[, and];
              (c) a nonprofit [corporations] corporation, if [those ] the nonprofit [corporations were]
          corporation was formerly a public [bodies. Where portions of] body; and
              (d) a private party if the authority or public body:
              (i) intends to own the project throughout the useful life of the project; and
              (ii) determines that such ownership of the project furthers a legitimate public purpose.
              (3) If a project [have] has been so sublet, the sublessor shall continue to be responsible for
          the payment of rent due under its lease contract with the authority.
              Section 2. Section 17A-3-913 is amended to read:
              17A-3-913. Property, rentals, and bonds exempt from taxation -- Interest on bonds
          subject to corporate franchise tax.
              (1) All property owned, held, or acquired by a building authority[,] and all rentals becoming
          due under [leasing contracts, and all] a leasing contract shall be exempt from all taxation in this state.
              (2) All bonds issued by a building authority and the interest accruing on them shall be
          exempt from all taxation in this state, except for the corporate franchise tax.
              Section 3. Effective date.
              Section 17A-3-913 takes effect on July 1, 1996.

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