SB 1080

O n all transfers of realty, whether by deed, court deed, decree, partition deed, or other instrument evidencing transfer of any interest in real estate, present law requires there to be paid for the privilege of having the same recorded a tax, for sta te purposes only, of 37¢ per $100 . This bill requires the department of revenue to remit back to each county, respectively, 50% of the recordation taxes on the transfer of realty that are collected within that county. AUTHORIZED USES This bill prohibi ts such funds received by counties from be ing used for salaries and benefits but authorizes the funds to be used for infrastructure, debt service for capital projects , m atching funds for state and federal project , or o ther nonrecurring expenses . In alloca ting the funds received, a county must dedicate not less tha n 50% of the funds to transportation infrastructure projects . However, a county must not use the funds from this revenue source to supplant other state or local moneys appropriated or allocated f or building, maintaining, or improving county roads or bridges. When presenting the annual work program required under county uniform highway law, the chief administrative officer of the county highway department must also present recommendations to the c ounty commission for the use of these funds, prior to their appropriation. SPECIAL ALLOCATIONS For collecting and reporting recordation taxes levied, present law authorizes county registers to retain as commission 5% of the taxes so collected. However , 52% of the 5% commission must be remitted to the state treasurer and credited to the general fund of the state. Present law further requires certain portions of the recordation tax levied be credited to special agency accounts, including 3.25¢ to the we tland acquisition fund , 1.75¢ to the local parks land acquisition fund , 1.5¢ to the state lands acquisition fund , and 1.5¢ to the agricultural resources conservation fund . However, b eginning fiscal year 2015-2016, 50% of the total growth in collections of recordation tax over the previous fiscal year and deposited to the above special funds must be transferred and credited elsewhere: 64% must be transferred and credited to the Tennessee Civil War or War Between the States site preservation fund and 36% must be transferred and credited to the historic property land acquisition fund . This bill requires the above special allocations to be deducted from the 50% of the revenue that is retained by the state, and the distribution to county governments must no t reduce the portion of the funds allocated for those purposes. NOT A LOCAL REVENUE SOURCE This bill prohibits, d ue to the fluctuations in collections from the recordation tax es levied , funds received by the county from be ing considered a local revenue source when calculating the five-year average of local funds spent for road purposes.