Current through August 31, 2023
Section
63-2428, Idaho Code
01.
Exemption to Bond Requirements for
Licensed Distributors. Bonds are required of all licensed distributors
unless the distributor is found to be financially responsible. A licensed
distributor seeking exemption from the bonding requirement must apply for the
exemption by filing a written petition with the Tax Commission. The petition
must contain information relating to the requirements of Section
63-2428, Idaho Code, for
establishing financial solvency and responsibility. Together with the petition,
the distributor must submit any information required in the following
Subsections 310.01.a. through 310.01.e.
(3-31-22)
a. If all or any part of the
unencumbered property offered to show financial solvency is real property, the
petition must include both a title report from an independent title company
reporting on the state of the title of the real property as of a time not more
than fifteen (15) days before the filing of the petition and a copy of the most
recent valuation notice issued by the county assessor for ad valorem property
tax purposes. (3-31-22)
b. If all
or any part of the unencumbered property is licensed motor vehicles, the
petition must include copies of the titles of the vehicles and evidence of the
value of the vehicles from a source independent from the distributor.
(3-31-22)
c. If all or any part of
the unencumbered property is personal property other than motor vehicles, the
petition must include a description of the property, evidence of ownership of
the property, an independent appraisal of the property, and evidence that the
property is unencumbered. Copies of all documents relating to all of the
distributor's current and long-term liabilities, including contingent
liabilities, lawsuits or potential lawsuits to which the distributor is or may
become a party, are required to establish that no security interests or other
encumbrances exist. (3-31-22)
d.
The petitioner must arrange, at the petitioner's expense, for an established,
independent commercial credit rating company to submit directly to the Tax
Commission a current and complete credit report about the licensed distributor;
or, the distributor must include with the petition its most recent financial
statements, including a current income statement, balance sheet, and statement
of cash flows. If the petitioner is a publicly held company, the financial
statements must be accompanied by an opinion issued by an independent certified
public accountant and a responsible company officer must also certify that the
financial statements provided present fairly the financial position of the
company. If the petitioner is a privately held company, the financial
statements must be reviewed by a certified public accountant or licensed public
accountant and a responsible company officer must also certify that the
financial statements provided present fairly the financial position of the
company. (3-31-22)
e. The Tax
Commission may require the distributor to supplement its petition with such
further information as the Tax Commission, in its discretion, finds necessary
to determine financial responsibility. If incomplete or substitute submissions
are received by the Tax Commission, the information submitted is reviewed on a
case-by-case basis to determine whether an exemption from the bonding
requirement is granted. (3-31-22)
02.
Conditions for Termination of
Exemption. If granted, the exemption from the bonding requirement will
terminate: (3-31-22)
a. One (1) year after the
date on which it was granted. (3-31-22)
b. Ninety (90) days after the occurrence of
any delinquency in motor fuels tax unless the delinquency has been paid within
that time period. (3-31-22)
c. Upon
the occurrence of any encumbrance of any of the property upon which the finding
of financial responsibility was based. (3-31-22)
d. Upon the occurrence of any change in the
business activity of the distributor that would cause the amount of bond
required to be increased to an amount greater than the value of the
distributor's unencumbered assets. (3-31-22)
e. Upon the occurrence of any event
prejudicing the distributor's solvency or financial responsibility.
(3-31-22)
03.
Bond
Requirement upon Termination of Exemption. Immediately upon any
termination of the exemption from the requirement for a bond the distributor
must supply the required bond according to Section
632428, Idaho Code.
(3-31-22)
04.
Pending
Application Does Not Excuse the Bond Requirement. Having an application
pending for exemption from the requirement for a bond does not excuse the bond.
If a bond exemption is due to expire, the distributor must submit a new
petition applying for a continuation of the exemption no later than ninety (90)
days before the day the exemption is due to expire to prevent a lapse in the
exemption. The petition must meet all of the requirements of this rule.
(3-31-22)
05.
Conditions for
Renewal of Bond Exemption. The following must be submitted to renew a
bond exemption: (3-31-22)
a. A written request
for renewal of waiver; (3-31-22)
b.
The information required in Subsections
310.01.a. through 310.01.e. of
this rule. (3-31-22)
