flight property tax; deposit
HB 2461 repeals a session law provision which deposited 50% of all flight property tax revenues into the state general fund, thereby depositing all flight property tax revenues into the state aviation fund.
Flight property tax (FPT) is a tax on airline property, which is considered a class 7 property for taxation purposes. According to statute, the FPT rate is the current year average of tax rates assessed against all other taxable property in this state. Other taxes are prohibited upon the flight property of airline companies operating in Arizona. While originally all FPT collections were deposited in the state general fund, in following years, a growing percentage of FPT collections began to be deposited in the state aviation fund. Beginning in 1989, all FPT revenue was deposited in the aviation fund pursuant to ARS § 42-705. The state aviation fund, administered by the Arizona Department of Transportation (ADOT), is charged with providing for a state-owned airport and a grant source for eligible airports for the planning, development and construction of the aviation system in Arizona. FPT collections provide the majority of revenue for the fund, though a number of sources deposit revenue into the aviation fund.
In 1997, the Legislature diverted 50 percent of FPT collections from the aviation fund to the general fund (Laws 1997, First Special Session, Chapter 3, Section 5, otherwise known as the 1997 Public Finances ORB). On January 1, 1999, ARS § 42-705 was repealed as a result of a recodification of Title 42. This section was replaced with ARS § 42-14255, which again provides for 100% of FPT revenue to be deposited in the aviation fund. However, Laws 1999, 1st Special Session, Chapter 3, section 9 (the 1999 Public Finances ORB) conformed the 1997 session law with the recodified Title 42, thereby maintaining the current 50% general fund and 50% aviation fund revenue distribution.