Streamlined Sales Tax Advisory Council

February 3, 2005, Meeting Minutes

I. Opening Comments

Mike Ralston and Kristi Magill, Co-Chairs, opened the meeting. Kristi indicated that things are starting to move at the National level.

II. Update from National Meeting in Phoenix

Certified Service Provider RFP – Twelve bids were received. The 20 conforming states are reviewing the bids and will provided feedback identifying issues needing to be clarified. Over the next 30 days, bidders will be scored, narrowed down, and then a review of the final bidders will take place. The goal is to have the selected bidders certified and contracts signed by July 1, 2005. There was some discussion on this date. Legislators want to know potential costs. This information probably will be available at the March National Meeting. If the Department gets something before our next meeting, Don will share it. Iowa will pay for the costs through revenue generated from streamline collections. Kristi hopes businesses will get an idea soon on what their costs will be to implement.

Central Registration System – This is now out for RFP. MTC developed the traditional piece of a registration system. Implementation of traditional filing system is slated for March 1, 2005.

Petition for Membership into Agreement – We have sent our Petition for Membership and Compliance Checklist to the Co-Chairs of the Implementing States; Scott Peterson, Interim Executive Director; and these documents are posted on our Web site. They are required to be posted for a minimum of 30 days for public input, and then states have 15 days to respond.

Kansas, Michigan and Oklahoma have also petitioned for membership.

Diane will e-mail Iowa’s Compliance Checklist to the Advisory Council. All 20 implementing states must submit Petitions for Membership by July 1, 2005, and the implementing states will vote on whether or not each state is in substantial conformance.

Business Taxpayer Advisory Council (BTAC) – Debates continue on the language in the Agreement pertaining to the creation of the BTAC continues. The Business sector and Iowa’s Advisory Council feel that the language “create” does not mean “control.” It’s a touchy issue. Kristi thinks there’s going to be an amendment to the Agreement to change the language to “the Governing Board will recognize the Business Taxpayer Advisory Council…” We want to make sure all levels of business are represented on the board of directors of the BTAC. COST wants businesses left alone to organize. Representation for all size and types of businesses concerned and voting must be represented. If not representing everyone, then the Governing Board may not recognize the BTAC. Our Advisory Council’s input will be really important to provide input on organizing this BTAC. Kristi looks for by-laws for BTAC to be at the next SST National Meeting.

Presentation of Revenue Estimates by Washington – Washington is the only state that has attempted to figure revenue estimates. They estimate that in 2006 voluntary revenue will be $25 million. One error in their methodology in the nexus area was identified. Other states are also trying to figure estimated revenue.

The Council discussed the amnesty process.

Other:

Ohio is still pushing the concept of a phase in for small businesses. This concept will be voted on by implementing states to see if an amendment to the Agreement should be made.

Effective dates of states and affects of delaying were discussed.

Cost of Collection Study – The process continues to move forward. Kristi didn’t know if the vacant seat had been filled.

Buy-Downs – Businesses and states are still going back and forth on this issue. Kristi provided the Council with a draft that Business issued in January about the subject. It’s a complex issue. Nonpaper discounts, group discounts, membership discounts, etc., are treated differently. Dave Casey discussed the current law regarding buy-downs.

III. Status of Rule Changes

The first set becomes ffective February 23, 2005. When the second set is ready, it will be posted on the Web site. The Department will notify the Council for their review.

IV. Final Proposed Legislation

Dave went over this legislation with the Council. The Council approved the language. The section on medical changes will be provided to local lobbyists for review. The Council discussed the best way to notify the Legislature of the necessary legislation.

V. Proposed Report to the Legislature

The Council reviewed and suggested some changes. Mike and Kristi will work on it together and provide a final hard copy to the Advisory Council.

VI. Set Next Meeting

Scheduled the next meeting to be held Friday, March 18, 2005, at the Hoover State Office Building from 10:00 a.m. to Noon.

VII. SST National meeting in March

Kristi looks for a lot of information to come out of the next SST National meeting in March.

Mike adjourned the meeting.