Section 17 Surtax Implementation 1
Said chapter 29 is hereby further amended by inserting after section
2AAAAAA the following 3 sections:-
Section 2BBBBBB. (a) For the purposes of this section, "income surtax revenue" shall mean income tax revenue from the additional 4 per cent income tax levied on annual taxable income in excess of $1,000,000, as adjusted, pursuant to Article XLIV of the Amendments to the Constitution of the Commonwealth.
(b) There shall be established and set up on the books of the commonwealth a separate fund known as the Education and Transportation Fund. The fund shall
be credited with: (i) income surtax revenue; (ii) appropriations or other money authorized or transferred by the general court and specifically designated to be credited to the fund; (iii) funds from public and private sources, including, but not limited to, gifts, grants and donations; and (iv) any interest earned on the assets of the fund. Amounts credited to the fund shall be expended, subject to appropriation, for quality public education and affordable public colleges and universities and for the repair and maintenance of roads, bridges and public transportation. The fund shall not be subject to section 5C.
(c) Quarterly, the comptroller shall transfer from the fund the amount of tax revenues the department of revenue estimates to have been collected from
income surtax revenue that exceeds the threshold established pursuant to subsection (f), as follows: (i) 15 per cent of such amount shall be transferred to the Education and Transportation Reserve Fund established in section 2CCCCCC; and (ii) 85 per cent of such amount shall be transferred to the Education and Transportation Innovation and Capital Fund established in section 2DDDDDD; provided, however, that if in any year the transfer required under clause (i) would cause the balance of the Education and Transportation Reserve Fund to exceed 33 per cent of the threshold established pursuant to said subsection (f), such transfer shall be adjusted to meet a total balance of 33 per cent and all remaining funds shall be transferred to the Education and Transportation Innovation and Capital Fund.
(d) Income surtax revenues collected and deposited into the Education and Transportation Fund shall not be subject to the allowable state tax revenue
limitations established by chapter 62F. Annually, not later than September 1, the commissioner of revenue shall estimate, for the preceding fiscal year, the amount of revenue to exclude from the chapter 62F calculation and shall include such estimate in the report submitted to the state auditor pursuant to subsection (a) of section 5 of said chapter 62F; provided, however, that this estimate shall be final.
(e) Income surtax revenues collected and deposited into the Education and Transportation Fund shall not be considered tax revenues collected from capital
gains income for the purposes of section 5G. The commissioner of revenue shall estimate, in the capital gains tax certification in the fourth quarter of the fiscal year, the amount of revenue to exclude from the section 5G calculation; provided, however, that this estimate shall be final.
(f) Annual expenditures from the fund shall not exceed a spending threshold proposed by the governor and enacted by the general court as part of the
consensus revenue process pursuant to section 5B. The annual spending threshold shall represent an amount of revenue that may reliably be expected to occur in the ensuing fiscal year based on experience to date and the testimony provided at the joint hearing on the economy under said section 5B.
(g) Any expenditures authorized from the fund shall be subject to sections 9B and 9C, without respect to whether such purposes would otherwise be subject
to allotment; provided, however, that section 9C shall only apply where the amount of certified revenue in any fiscal year is less than the annual spending threshold established under subsection (f).
(h) Annually, in consultation with the secretary of administration and finance, as part of the annual statutory basis financial report required pursuant
to paragraph (2) of subsection (a) of section 12 of chapter 7A, the comptroller shall certify the amount of funds expended in the prior fiscal year from the fund and designate each expenditure as transportation or education on the basis of the department through which the expenditures were authorized.
Section 2CCCCCC. (a) There shall be established and set up on the books of the commonwealth a separate fund known as the Education and Transportation Reserve Fund. The fund shall be credited with: (i) funds transferred pursuant to subsection (c) of section 2BBBBBB; (ii) appropriations or other money authorized or transferred by the general court and specifically designated to be credited to the fund; (iii) funds from public and private sources, including, but not limited to, gifts, grants and donations; and (iv) any interest earned on the assets of the fund. The balance of the fund shall not exceed 33 per cent of the annual spending threshold set pursuant to subsection (f) of said section 2BBBBBB. Amounts credited to the fund may be expended, subject to appropriation, to offset the unforeseen and dramatic loss of revenues within a fiscal year, after implementing all efficiencies and savings possible, to pay current liabilities of the Education and Transportation Fund established in subsection (b) of said section 2BBBBBB. The account shall not be subject to section 5C.
(b) The comptroller shall certify the balance of the fund at the end of each fiscal year.
Section 2DDDDDD. (a) There shall be established and set up on the books of the commonwealth a separate fund knows as the Education and Transportation Innovation and Capital Fund. The fund shall be credited with: (i) funds transferred pursuant to subsection (c) of section 2BBBBBB; (ii) appropriations or other money authorized or transferred by the general court and specifically designated to be credited to the fund; (iii) funds from public and private sources, including, but not limited to, gifts, grants and donations; and (iv) any interest earned on the assets of the fund. Amounts credited to the fund shall be expended, subject to appropriation, on 1-time investments, including, but not limited to, pay-go capital or other 1-time projects, related to quality public education and affordable public colleges and universities and for the repair and maintenance of roads, bridges and public transportation. Amounts credited to the fund shall be made available for expenditure upon their certification pursuant to section 5I. The fund shall not be subject to section 5C.
(b) The comptroller shall certify the balance of the fund at the end of each fiscal year.