                                 CODE OF VIRGINIA

DISPOSITION OF STATE SALES AND USE TAX REVENUE (§ 58.1-638)

A. The Comptroller shall designate a specific revenue code number for all the
state sales and use tax revenue collected under the preceding sections of this
chapter.
			The sales and use tax revenue generated by the one-half percent sales and use
tax increase enacted by the 1986 Special Session of the General Assembly shall
be paid, in the manner hereinafter provided in this section, to the Commonwealth
Transportation Fund established pursuant to &#xA7; 33.2-1524. The Fund&#8217;s
share of such net revenue shall be computed as an estimate of the net revenue to
be received into the state treasury each month, and such estimated payment shall
be adjusted for the actual net revenue received in the preceding month. All
payments shall be made to the Fund on the last day of each month.

B. The sales and use tax revenue generated by a one percent sales and use tax
shall be distributed among the counties and cities of the Commonwealth in the
manner provided in subsections C and D.

C. The localities&#8217; share of the net revenue distributable under this
section among the counties and cities shall be apportioned by the Comptroller
and distributed among them by warrants of the Comptroller drawn on the Treasurer
of Virginia as soon as practicable after the close of each month during which
the net revenue was received into the state treasury. The distribution of the
localities&#8217; share of such net revenue shall be computed with respect to
the net revenue received into the state treasury during each month, and such
distribution shall be made as soon as practicable after the close of each such
month.

D. The net revenue so distributable among the counties and cities shall be
apportioned and distributed upon the basis of the latest yearly estimate of the
population of cities and counties ages five to 19, provided by the Weldon Cooper
Center for Public Service of the University of Virginia. Such population
estimate produced by the Weldon Cooper Center for Public Service of the
University of Virginia shall account for persons who are domiciled in orphanages
or charitable institutions or who are dependents living on any federal military
or naval reservation or other federal property within the school division in
which the institutions or federal military or naval reservation or other federal
property is located. Such population estimate produced by the Weldon Cooper
Center for Public Service of the University of Virginia shall account for
members of the military services who are under 20 years of age within the school
division in which the parents or guardians of such persons legally reside. Such
population estimate produced by the Weldon Cooper Center for Public Service of
the University of Virginia shall account for individuals receiving services in
state hospitals, state training centers, or mental health facilities, persons
who are confined in state or federal correctional institutions, or persons who
attend the Virginia School for the Deaf and the Blind within the school division
in which the parents or guardians of such persons legally reside. Such
population estimate produced by the Weldon Cooper Center for Public Service of
the University of Virginia shall account for persons who attend institutions of
higher education within the school division in which the student&#8217;s parents
or guardians legally reside. To such estimate, the Department of Education shall
add the population of students with disabilities, ages two through four and 20
through 21, as provided to the Department of Education by school divisions. The
revenue so apportionable and distributable is hereby appropriated to the several
counties and cities for maintenance, operation, capital outlays, debt and
interest payments, or other expenses incurred in the operation of the public
schools, which shall be considered as funds raised from local resources. In any
county, however, wherein is situated any incorporated town constituting a school
division, the county treasurer shall pay into the town treasury for maintenance,
operation, capital outlays, debt and interest payments, or other expenses
incurred in the operation of the public schools, the proper proportionate amount
received by him in the ratio that the school population of such town bears to
the school population of the entire county. If the school population of any city
or of any town constituting a school division is increased by the annexation of
territory since the last estimate of school population provided by the Weldon
Cooper Center for Public Service, such increase shall, for the purposes of this
section, be added to the school population of such city or town as shown by the
last such estimate and a proper reduction made in the school population of the
county or counties from which the annexed territory was acquired.

E. Beginning July 1, 2000, of the remaining sales and use tax revenue, the
revenue generated by a two percent sales and use tax, up to an annual amount of
$13 million, collected from the sales of hunting equipment, auxiliary hunting
equipment, fishing equipment, auxiliary fishing equipment, wildlife-watching
equipment, and auxiliary wildlife-watching equipment in Virginia, as estimated
by the most recent U.S. Department of the Interior, Fish and Wildlife Service
and U.S. Department of Commerce, Bureau of the Census National Survey of
Fishing, Hunting, and Wildlife-Associated Recreation, shall be paid into the
Game Protection Fund established under &#xA7; 29.1-101 and shall be used, in
part, to defray the cost of law enforcement. Not later than 30 days after the
close of each quarter, the Comptroller shall transfer to the Game Protection
Fund the appropriate amount of collections to be dedicated to such Fund. At any
time that the balance in the Capital Improvement Fund, established under &#xA7;
29.1-101.01, is equal to or in excess of $35 million, any portion of sales and
use tax revenues that would have been transferred to the Game Protection Fund,
established under &#xA7; 29.1-101, in excess of the net operating expenses of
the Board, after deduction of other amounts which accrue to the Board and are
set aside for the Game Protection Fund, shall remain in the general fund until
such time as the balance in the Capital Improvement Fund is less than $35
million.

F. 1. Of the net revenue generated from the one-half percent increase in the
rate of the state sales and use tax effective August 1, 2004, pursuant to
enactments of the 2004 Special Session I of the General Assembly, the
Comptroller shall transfer from the general fund of the state treasury to the
Public Education Standards of Quality/Local Real Estate Property Tax Relief Fund
established under § 58.1-638.1 an amount equivalent to one-half of the net
revenue generated from such one-half percent increase as provided in this
subdivision. The transfers to the Public Education Standards of Quality/Local
Real Estate Property Tax Relief Fund under this subdivision shall be for
one-half of the net revenue generated (and collected in the succeeding month)
from such one-half percent increase for the month of August 2004 and for each
month thereafter.

   2. Beginning July 1, 2013, of the remaining sales and use tax revenue, an
   amount equal to the revenue generated by a 0.125 percent sales and use tax
   shall be distributed to the Public Education Standards of Quality/Local Real
   Estate Property Tax Relief Fund established under &#xA7; 58.1-638.1, and be
   used for the state&#8217;s share of Standards of Quality basic aid payments.

   3. For the purposes of the Comptroller making the required transfers under
   subdivision 1 and 2, the Tax Commissioner shall make a written certification
   to the Comptroller no later than the twenty-fifth of each month certifying the
   sales and use tax revenues generated in the preceding month. Within three
   calendar days of receiving such certification, the Comptroller shall make the
   required transfers to the Public Education Standards of Quality/Local Real
   Estate Property Tax Relief Fund.

G. (Contingent expiration date) Beginning July 1, 2020, of the remaining sales
and use tax revenue, an amount equal to 20 percent of the revenue generated by a
one-half percent sales and use tax, such as that paid to the Commonwealth
Transportation Fund as provided in subsection A, shall be paid to the
Commonwealth Transportation Fund established pursuant to &#xA7; 33.2-1524.
			The Commonwealth Transportation Fund&#8217;s share of the net revenue
distributable under this subsection shall be computed as an estimate of the net
revenue to be received into the state treasury each month, and such estimated
payment shall be adjusted for the actual net revenue received in the preceding
month. All payments shall be made to the Fund on the last day of each month.

H. (Contingent expiration date)

   1. The additional revenue generated by increases in the state sales and use
   tax from Planning District 8 pursuant to &#xA7;&#xA7; 58.1-603.1, 58.1-604.01,
   58.1-604.1, and 58.1-614 shall be deposited by the Comptroller in the fund
   established under &#xA7; 33.2-2509.

   2. The additional revenue generated by increases in the state sales and use
   tax from Planning District 23 pursuant to &#xA7;&#xA7; 58.1-603.1,
   58.1-604.01, 58.1-604.1, and 58.1-614 shall be deposited by the Comptroller in
   the fund established under &#xA7; 33.2-2600.

   3. (For contingent expiration date, see Acts 2020, c. 1235) The additional
   revenue generated by increases in the state sales and use tax from Planning
   District 15 pursuant to &#xA7;&#xA7; 58.1-603.1, 58.1-604.01, 58.1-604.1, and
   58.1-614 shall be deposited by the Comptroller in the fund established under
   &#xA7; 33.2-3701.

   4. The additional revenue generated by increases in the state sales and use
   tax in any other Planning District pursuant to &#xA7;&#xA7; 58.1-603.1,
   58.1-604.01, 58.1-604.1, and 58.1-614 shall be deposited into special funds
   that shall be established by appropriate legislation.

   5. The net revenues distributable under this subsection shall be computed as
   an estimate of the net revenue to be received by the state treasury each
   month, and such estimated payment shall be adjusted for the actual net revenue
   received in the preceding month. All payments shall be made to the appropriate
   funds on the last day of each month.

I. (For contingent expiration date, see Acts 2018, c. 850) The additional
revenue generated by increases in the state sales and use tax from the Historic
Triangle pursuant to &#xA7; 58.1-603.2 shall be deposited by the Comptroller as
follows: (i) 50 percent shall be deposited into the Historic Triangle Marketing
Fund established pursuant to subsection F of &#xA7; 58.1-603.2; and (ii) 50
percent shall be deposited in the special fund created pursuant to subdivision D
2 of &#xA7; 58.1-603.2 and distributed to the localities in which the revenues
were collected. The net revenues distributable under this subsection shall be
computed as an estimate of the net revenues to be received by the state treasury
each month, and such estimated payment shall be adjusted for the actual net
revenue received in the preceding month. All payments shall be made to the
appropriate funds on the last day of each month.

J. If errors are made in any distribution, or adjustments are otherwise
necessary, the errors shall be corrected and adjustments made in the
distribution for the next quarter or for subsequent quarters.

K. The term &#8220;net revenue,&#8221; as used in this section, means the gross
revenue received into the general fund or the Commonwealth Transportation Fund
of the state treasury under the preceding sections of this chapter, less refunds
to taxpayers.

HISTORY: Code 1950, § 58-441.48; 1966, c. 151; 1976, c. 680; 1978, c. 773;
1980, c. 559; 1984, c. 675; 1986, Sp. Sess., c. 12; 1991, cc. 666, 713; 1992, c.
167; 1993, c. 793; 1995, cc. 539, 542; 1998, cc. 320, 905, 907; 1999, cc. 281,
397, 898; 2000, cc. 694, 707; 2001, c. 171; 2004, Sp. Sess. I, c. 3; 2010, cc.
113, 386, 629; 2012, cc. 476, 507, 779, 817; 2013, cc. 639, 766; 2015, cc. 609,
684; 2018, cc. 506, 850, 854, 856; 2019, c. 854; 2020, cc. 1230, 1235, 1275,
1283; 2022, c. 652.