ARIZONA STATE SENATE
Phoenix, Arizona
A proposition 108 measure
that repeals the current tax levy for wireline and wireless access service and
sets an increased tax rate that will eventually reach 20 cents for each
residential wireline service, business wireline service and wireless service.
Local and regional 911 committees work with the telecommunication industry to address emergency communications issues. The Department of Administration (DOA) administrates the emergency telecommunication services revolving fund and is responsible for approving all funding for the emergency telecommunication infrastructure. Since 1983, the state has funded 911 telecommunication services with an excise tax on telephone service.
The Maricopa County 911
system has been operational since 1985. According to the Maricopa Association
of Governments (MAG), despite significant population and technological growth
in this period, little has changed with the 911 system. Specifically, MAG
recommends new equipment due to the increased use of wireless phone. In
Arizona, when wireless phones are used to call 911, the 911 operators cannot
get a location of the caller nor can they return the call if disconnection
occurs because the wireless phone does not register a phone number in the
system.
Currently, the excise tax is approximately $.16 for landlines and at $.10 for wireless phones. H.B. 2625 increases the tax levy for residential and business wireline services as well as the levy for wireless access service to increase the monies in the emergency telecommunication services revolving fund.
The rate increase in this
bill addresses the cost of the new equipment and the corresponding Federal
Communications Commission requirements for 911 telecommunications, which comes
in two phases. The first phase requires
the wireless vendor to deliver to the Public Safety Answering Point (PSAP)
data, which represents the complete ten-digit telephone number of the wireless
handset, the street address of the wireless tower and the antenna face on that
tower being utilized for the 911 call. This information would allow a
call-talker at the PSAP to reasonably define a geographic area from which the
call has originated and have the telephone number for callback purposes in case
of disconnect.
The second phase requires
the delivery of the ten-digit number of the wireless handset in addition to the
requirement that the actual latitude and longitude coordinates of the wireless
device within 125 meters (400 feet) with a minimum 67 percent accuracy. Also,
the data stream sent to PSAP is the confidence level regarding the accuracy of
the location data provided, the direction of travel, speed of travel and height
above sea level.
1. Removes the one and one-fourth percent tax levy on the gross proceeds of sales or the gross income derived from the business of providing exchange access services to finance emergency telecommunication services.
2. Removes the ten-cent wireless tax levy imposed on providers for each activated wireless service.
3. Sets, beginning July 1, 2001, a tax levy of 20 cents per month for each activated residential wireline service to finance emergency telecommunication services.
4. Sets a tiered tax levy for activated business wireline service to finance emergency telecommunication services as follows:
·
Beginning
July 1, 2001, a tax levy of 50 cents per month;
·
Beginning
July 1, 2007, the tax levy at 28 cents per month; and
·
Beginning
July 1, 2008, the tax levy at 20 cents per month.
5. Sets a tiered tax levy for each activated wireless service to finance emergency telecommunication services as follows
·
Beginning
July 1, 2001, a tax levy of 47 cents per month;
·
Beginning
July 1, 2007, the tax levy at 28 cents per month; and
·
Beginning
July 1, 2008, the tax levy at 20 cents per month.
6. Requires each access service provider to state on the invoice to customers a separate line item specifying the amount of the tax levied that will fund emergency telecommunication.
7. Specifies that the Department of Revenue (DOR) shall deposit all monies remitted for the purpose of financing emergency telecommunication to the emergency telecommunication services revolving fund (fund).
8. Specifies that beginning July 1, 2001, DOR is allowed to use up to two percent of the fund for its administrative costs and further specifies that the remaining monies must be allocated for local network management of contracts with public safety answering points.
9. Expands the use of the fund to allow a wireless carrier’s one-time costs associated with the establishment and maintenance of the wireless emergency telecommunication services to the extent that the wireless carrier has not recovered costs through the deduction mechanism specified in federal law.
10. Includes the tax levy for activated wireless access service under those levies for which the unexpended monies in the fund are applied at the end of each fiscal year.
11. Specifies the Director of DOR to separately account for the costs associated with wireless access to emergency telecommunication services and to report those costs to the legislature by December 31, 2002.
12. Specifies that in FY 2002 and every two years thereafter, the Legislature must review and take legislative action regarding the telecommunication excise tax recommendation of the Director of DOR.
Miscellaneous
13. Makes technical and conforming changes.
14. Contains a proposition 108 clause.
House Action
EUT 2/21/01 DPA 6-2-1-1
WM 3/6/01 DPA 9-0-1-0
3rd
Read 3/19/01 44-10-6-0
Prepared
by Senate Staff
March
29, 2001