Purpose

Redirects 14 percent of flight property tax revenues from the general fund to the aviation fund. This deposits 64 percent of flight property tax revenues to the aviation fund and 36 percent into the state general fund.

Background

Flight property tax (FPT) is a tax on airline property, which is considered class 7 for property 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 general fund, in following years a growing percentage of FPT collections were diverted to the aviation fund. Beginning in 1989, all FPT revenues were deposited in the aviation fund. The state aviation fund, administered by the Arizona Department of Transportation, is charged with providing for a grant source for eligible airports for the planning, development and construction of the aviation system in Arizona.

Pursuant to Laws 1997, First Special Session, Chapter 3, 50 percent of FPT collections were directed to the state general fund instead of the aviation fund.

The strike everything amendment amends the 1997 enactment, depositing 64 percent of FPT revenue in the aviation fund and 36 percent in the state general fund. According to data provided by the Joint Legislative Budget Committee, this measure reduces annual state general fund revenues by an estimated $2 million beginning FY 2000-2001. There is a corresponding revenue increase projected for the aviation fund.

Provisions

1. Redirects 14 percent of flight property tax revenues from the state general fund to the aviation fund.

2. Provides for a general effective date.

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