1994-03-14                     Senate Journal                      Page 3186
SB 261                                                                       
The Finance Committee considered SENATE BILL NO. 261 "An                       
Act relating to municipal sales and use taxes involving air carriers;          
and providing for an effective date" and recommended it be replaced            
with                                                                           
                                                                               
	CS FOR SENATE BILL NO. 261(FIN), entitled:                                    
"An Act relating to municipal taxes and fees on the                           
air transportation of individuals or goods by                                  
federally certificated air carriers; and providing for                         
an effective date."                                                            
                                                                               
and further attaches a Letter of Intent.                                       
                                                                               
Signing no recommendation: Senators Frank, Pearce, Cochairs,                   
Senators Kelly, Kerttula, Rieger.  Signing do pass: Senator Sharp.             
Signing do not pass: Senator Jacko.                                            
                                                                               
                                Letter of Intent                               
                                      for                                      
                              Senate Bill No. 261                              
                                                                               
It is the intent of the Legislature to define the                             
powers of municipalities to tax commercial aviation                            
activities in a manner consistent with federal                                 
aviation law.                                                                  
                                                                               
Municipalities may not levy taxes, directly or                                
indirectly, on passengers and air freight carried by                           
commercial air service companies holding Federal                               
Aviation Administration certificates.                                          
                                                                               
Municipalities may levy other taxes, currently                                
permitted under federal law, such as landing taxes,                            
fuel flowage fees, property taxes, and taxes on the                            
sale of goods and services which are incidental to                             
air transportation such as food provided to airline                            
passengers.                                                                    
                                                                               
                                                                               

1994-03-14                     Senate Journal                      Page 3187
SB 261                                                                       
Federal taxes on passengers and air freight, paid by                          
airport users, are returned to the States through the                          
Airport and Airways Trust Fund for the construction                            
of new airport facilities.  This was one reason for                            
federal limitation on the rights of states and                                 
municipalities to tax air transportation.                                      
                                                                               
Previous zero fiscal notes apply to the committee substitute.                  
                                                                               
SENATE BILL NO. 261 was referred to the Rules Committee.