38006
REVENUE AND TAXATION CODE
SECTION 38006
38006. The full text of the Multistate Tax Compact referred to in
Section 38001 is as follows:
Article I. Purposes.
The purposes of this compact are to:
1. Facilitate proper determination of State and local tax
liability of multistate taxpayers, including the equitable
apportionment of tax bases and settlement of apportionment disputes.
2. Promote uniformity or compatibility in significant components
of tax systems.
3. Facilitate taxpayer convenience and compliance in the filing of
tax returns and in other phases of tax administration.
4. Avoid duplicative taxation.
Article II. Definitions.
As used in this compact:
1. "State" means a State of the United States, the District of
Columbia, the Commonwealth of Puerto Rico, or any Territory or
Possession of the United States.
2. "Subdivision" means any governmental unit or special district
of a State.
3. "Taxpayer" means any corporation, partnership, firm,
association, governmental unit or agency or person acting as a
business entity in more than one state.
4. "Income tax" means a tax imposed on or measured by net income
including any tax imposed on or measured by an amount arrived at by
deducting expenses from gross income, one or more forms of which
expenses are not specifically and directly related to particular
transactions.
5. "Capital stock tax" means a tax measured in any way by the
capital of a corporation considered in its entirety.
6. "Gross receipts tax" means a tax, other than a sales tax, which
is imposed on or measured by the gross volume of business, in terms
of gross receipts or in other terms, and in the determination of
which no deduction is allowed which would constitute the tax an
income tax.
7. "Sales tax" means a tax imposed with respect to the transfer
for a consideration of ownership, possession or custody of tangible
personal property or the rendering of services measured by the price
of the tangible personal property transferred or services rendered
and which is required by State or local law to be separately stated
from the sales price by the seller, or which is customarily
separately stated from the sales price, but does not include a tax
imposed exclusively on the sale of a specifically identified
commodity or article or class of commodities or articles.
8. "Use tax" means a nonrecurring tax, other than a sales tax,
which (a) is imposed on or with respect to the exercise or enjoyment
of any right or power over tangible personal property incident to the
ownership, possession or custody of that property or the leasing of
that property from another including any consumption, keeping,
retention, or other use of tangible personal property and (b) is
complementary to a sales tax.
9. "Tax" means an income tax, capital stock tax, gross receipts
tax, sales tax, use tax, and any other tax which has a multistate
impact, except that the provisions of Articles III, IV and V of this
compact shall apply only to the taxes specifically designated therein
and the provisions of Article IX of this compact shall apply only in
respect to determinations pursuant to Article IV.
Article III. Elements of Income Tax Laws.
Taxpayer Option, State and Local Taxes.
1. Any taxpayer subject to an income tax whose income is subject
to apportionment and allocation for tax purposes pursuant to the laws
of a party State or pursuant to the laws of subdivisions in two or
more party States may elect to apportion and allocate his income in
the manner provided by the laws of such State or by the laws of such
States and subdivisions without reference to this compact, or may
elect to apportion and allocate in accordance with Article IV. This
election for any tax year may be made in all party States or
subdivisions thereof or in any one or more of the party States or
subdivisions thereof without reference to the election made in the
others. For the purposes of this paragraph, taxes imposed by
subdivisions shall be considered separately from State taxes and the
apportionment and allocation also may be applied to the entire tax
base. In no instance wherein Article IV is employed for all
subdivisions of a State may the sum of all apportionments and
allocations to subdivisions within a State be greater than the
apportionment and allocation that would be assignable to that State
if the apportionment or allocation were being made with respect to a
State income tax.
Taxpayer Option, Short Form.
2. Each party State or any subdivision thereof which imposes an
income tax shall provide by law that any taxpayer required to file a
return, whose only activities within the taxing jurisdiction consist
of sales and do not include owning or renting real estate or tangible
personal property, and whose dollar volume of gross sales made
during the tax year within the State or subdivision, as the case may
be, is not in excess of $100,000 may elect to report and pay any tax
due on the basis of a percentage of such volume, and shall adopt
rates which shall produce a tax which reasonably approximates the tax
otherwise due. The Multistate Tax Commission, not more than once in
five years, may adjust the $100,000 figure in order to reflect such
changes as may occur in the real value of the dollar, and such
adjusted figure, upon adoption by the Commission, shall replace the
$100,000 figure specifically provided herein. Each party State and
subdivision thereof may make the same election available to taxpayers
additional to those specified in this paragraph.
Coverage.
3. Nothing in this Article relates to the reporting or payment of
any tax other than an income tax.
Article IV. Division of Income.
1. As used in this Article, unless the context otherwise requires:
(a) "Business income" means income arising from transactions and
activity in the regular course of the taxpayer's trade or business
and includes income from tangible and intangible property if the
acquisition, management, and disposition of the property constitute
integral parts of the taxpayer's regular trade or business
operations.
(b) "Commercial domicile" means the principal place from which the
trade or business of the taxpayer is directed or managed.
(c) "Compensation" means wages, salaries, commissions and any
other form of remuneration paid to employees for personal services.
(d) "Financial organization" means any bank, trust company,
savings bank, industrial bank, land bank, safe deposit company,
private banker, savings and loan association, credit union,
cooperative bank, small loan company, sales finance company,
investment company, or any type of insurance company.
(e) "Nonbusiness income" means all income other than business
income.
(f) "Public utility" means any business entity (1) which owns or
operates any plant, equipment, property, franchise, or license for
the transmission of communications, transportation of goods or
persons, except by pipe line, or the production, transmission, sale,
delivery, or furnishing of electricity, water or steam; and (2) whose
rates of charges for goods or services have been established or
approved by a Federal, State or local government or governmental
agency.
(g) "Sales" means all gross receipts of the taxpayer not allocated
under paragraphs of this Article.
(h) "State" means any State of the United States, the District of
Columbia, the Commonwealth of Puerto Rico, any Territory or
Possession of the United States, and any foreign country or political
subdivision thereof.
(i) "This State" means the State in which the relevant tax return
is filed or, in the case of application of this Article to the
apportionment and allocation of income for local tax purposes, the
subdivision or local taxing district in which the relevant tax return
is filed.
2. Any taxpayer having income from business activity which is
taxable both within and without this State, other than activity as a
financial organization or public utility or the rendering of purely
personal services by an individual, shall allocate and apportion his
net income as provided in this Article. If a taxpayer has income from
business activity as a public utility but derives the greater
percentage of his income from activities subject to this Article, the
taxpayer may elect to allocate and apportion his entire net income
as provided in this Article.
3. For purposes of allocation and apportionment of income under
this Article, a taxpayer is taxable in another State if (1) in that
State he is subject to a net income tax, a franchise tax measured by
net income, a franchise tax for the privilege of doing business, or a
corporate stock tax, or (2) that State has jurisdiction to subject
the taxpayer to a net income tax regardless of whether, in fact, the
State does or does not.
4. Rents and royalties from real or tangible personal property,
capital gains, interest, dividends or patent or copyright royalties,
to the extent that they constitute nonbusiness income, shall be
allocated as provided in paragraphs 5 through 8 of this Article.
5. (a) Net rents and royalties from real property located in this
State are allocable to this State.
(b) Net rents and royalties from tangible personal property are
allocable to this State: (1) if and to the extent that the property
is utilized in this State, or (2) in their entirety if the taxpayer's
commercial domicile is in this State and the taxpayer is not
organized under the laws of or taxable in the State in which the
property is utilized.
(c) The extent of utilization of tangible personal property in a
State is determined by multiplying the rents and royalties by a
fraction, the numerator of which is the number of days of physical
location of the property in the State during the rental or royalty
period in the taxable year and the denominator of which is the number
of days of physical location of the property everywhere during all
rental or royalty periods in the taxable year. If the physical
location of the property during the rental or royalty period is
unknown or unascertainable by the taxpayer, tangible personal
property is utilized in the State in which the property was located
at the time the rental or royalty payer obtained possession.
6. (a) Capital gains and losses from sales of real property
located in this State are allocable to this State.
(b) Capital gains and losses from sales of tangible personal
property are allocable to this State if (1) the property had a situs
in this State at the time of the sale, or (2) the taxpayer's
commercial domicile is in this State and the taxpayer is not taxable
in the State in which the property had a situs.
(c) Capital gains and losses from sales of intangible personal
property are allocable to this State if the taxpayer's commercial
domicile is in this State.
7. Interest and dividends are allocable to this State if the
taxpayer's commercial domicile is in this State.
8. (a) Patent and copyright royalties are allocable to this State:
(1) if and to the extent that the patent or copyright is utilized by
the payer in this State, or (2) if and to the extent that the patent
or copyright is utilized by the payer in a State in which the
taxpayer is not taxable and the taxpayer's commercial domicile is in
this State.
(b) A patent is utilized in a State to the extent that it is
employed in production, fabrication, manufacturing, or other
processing in the State or to the extent that a patented product is
produced in the State. If the basis of receipts from patent royalties
does not permit allocation to States or if the accounting procedures
do not reflect States of utilization, the patent is utilized in the
State in which the taxpayer's commercial domicile is located.
(c) A copyright is utilized in a State to the extent that printing
or other publication originates in the State. If the basis of
receipts from copyright royalties does not permit allocation to
States or if the accounting procedures do not reflect States of
utilization, the copyright is utilized in the State in which the
taxpayer's commercial domicile is located.
9. All business income shall be apportioned to this State by
multiplying the income by a fraction, the numerator of which is the
property factor plus the payroll factor plus the sales factor, and
the denominator of which is three.
10. The property factor is a fraction, the numerator of which is
the average value of the taxpayer's real and tangible personal
property owned or rented and used in this State during the tax period
and the denominator of which is the average value of all the
taxpayer's real and tangible personal property owned or rented and
used during the tax period.
11. Property owned by the taxpayer is valued at its original cost.
Property rented by the taxpayer is valued at eight times the net
annual rental rate. Net annual rental rate is the annual rental rate
paid by the taxpayer less any annual rental rate received by the
taxpayer from subrentals.
12. The average value of property shall be determined by averaging
the values at the beginning and ending of the tax period but the tax
administrator may require the averaging of monthly values during the
tax period if reasonably required to reflect properly the average
value of the taxpayer's property.
13. The payroll factor is a fraction, the numerator of which is
the total amount paid in this State during the tax period by the
taxpayer for compensation and the denominator of which is the total
compensation paid everywhere during the tax period.
14. Compensation is paid in this State if:
(a) the individual's service is performed entirely within the
State;
(b) the individual's service is performed both within and without
the State, but the service performed without the State is incidental
to the individual's service within the State; or
(c) some of the service is performed in the State and (1) the base
of operations or, if there is no base of operations, the place from
which the service is directed or controlled is in the State, or (2)
the base of operations or the place from which the service is
directed or controlled is not in any State in which some part of the
service is performed, but the individual's residence is in this
State.
15. The sales factor is a fraction, the numerator of which is the
total sales of the taxpayer in this State during the tax period, and
the denominator of which is the total sales of the taxpayer
everywhere during the tax period.
16. Sales of tangible personal property are in this State if:
(a) the property is delivered or shipped to a purchaser, other
than the United States Government, within this State regardless of
the f.o.b. point or other conditions of the sale; or
(b) the property is shipped from an office, store, warehouse,
factory, or other place of storage in this State and (1) the
purchaser is the United States Government or (2) the taxpayer is not
taxable in the State of the purchaser.
17. Sales, other than sales of tangible personal property, are in
this State if:
(a) the income-producing activity is performed in this State; or
(b) the income-producing activity is performed both in and outside
this State and a greater proportion of the income-producing activity
is performed in this State than in any other State, based on costs
of performance.
18. If the allocation and apportionment provisions of this Article
do not fairly represent the extent of the taxpayer's business
activity in this State, the taxpayer may petition for or the tax
administrator may require, in respect to all or any part of the
taxpayer's business activity, if reasonable:
(a) separate accounting;
(b) the exclusion of any one or more of the factors;
(c) the inclusion of one or more additional factors which will
fairly represent the taxpayer's business activity in this State; or
(d) the employment of any other method to effectuate an equitable
allocation and apportionment of the taxpayer's income.
Article V. Elements of Sales and Use Tax Laws.
Tax Credit.
1. Each purchaser liable for a use tax on tangible personal
property shall be entitled to full credit for the combined amount or
amounts of legally imposed sales or use taxes paid by him with
respect to the same property to another State and any subdivision
thereof. The credit shall be applied first against the amount of any
use tax due the State, and any unused portion of the credit shall
then be applied against the amount of any use tax due a subdivision.
Exemption Certificates, Vendors May Rely.
2. Whenever a vendor receives and accepts in good faith from a
purchaser a resale or other exemption certificate or other written
evidence of exemption authorized by the appropriate State or
subdivision taxing authority, the vendor shall be relieved of
liability for a sales or use tax with respect to the transaction.
Article VI. The Commission.
Organization and Management.
1. (a) The Multistate Tax Commission is hereby established. It
shall be composed of one "member" from each party State who shall be
the head of the State agency charged with the administration of the
types of taxes to which this compact applies. If there is more than
one such agency the State shall provide by law for the selection of
the Commission member from the heads of the relevant agencies. State
law may provide that a member of the Commission be represented by an
alternate but only if there is on file with the Commission written
notification of the designation and identity of the alternate. The
Attorney General of each party State or his designee, or other
counsel if the laws of the party State specifically provide, shall be
entitled to attend the meetings of the Commission, but shall not
vote. Such Attorneys General, designees, or other counsel shall
receive all notices of meetings required under paragraph 1 (e) of
this Article.
(b) Each party State shall provide by law for the selection of
representatives from its subdivisions affected by this compact to
consult with the Commission member from that State.
(c) Each member shall be entitled to one vote. The Commission
shall not act unless a majority of the members are present, and no
action shall be binding unless approved by a majority of the total
number of members.
(d) The Commission shall adopt an official seal to be used as it
may provide.
(e) The Commission shall hold an annual meeting and such other
regular meetings as its bylaws may provide and such special meetings
as its Executive Committee may determine. The Commission bylaws shall
specify the dates of the annual and any other regular meetings, and
shall provide for the giving of notice of annual, regular and special
meetings. Notices of special meetings shall include the reasons
therefor and an agenda of the items to be considered.
(f) The Commission shall elect annually, from among its members, a
Chairman, a Vice Chairman and a Treasurer. The Commission shall
appoint an Executive Director who shall serve at its pleasure, and it
shall fix his duties and compensation. The Executive Director shall
be Secretary of the Commission. The Commission shall make provision
for the bonding of such of its officers and employees as it may deem
appropriate.
(g) Irrespective of the civil service, personnel or other merit
system laws of any party State, the Executive Director shall appoint
or discharge such personnel as may be necessary for the performance
of the functions of the Commission and shall fix their duties and
compensation. The Commission bylaws shall provide for personnel
policies and programs.
(h) The Commission may borrow, accept or contract for the services
of personnel from any State, the United States, or any other
governmental entity.
(i) The Commission may accept for any of its purposes and
functions any and all donations and grants of money, equipment,
supplies, materials and services, conditional or otherwise, from any
governmental entity, and may utilize and dispose of the same.
(j) The Commission may establish one or more offices for the
transacting of its business.
(k) The Commission shall adopt bylaws for the conduct of its
business. The Commission shall publish its bylaws in convenient form,
and shall file a copy of the bylaws and any amendments thereto with
the appropriate agency or officer in each of the party States.
(l) The Commission annually shall make to the Governor and
legislature of each party State a report covering its activities for
the preceding year. Any donation or grant accepted by the Commission
or services borrowed shall be reported in the annual report of the
Commission, and shall include the nature, amount and conditions, if
any, of the donation, gift, grant or services borrowed and the
identity of the donor or lender. The Commission may make additional
reports as it may deem desirable.
Committees.
2. (a) To assist in the conduct of its business when the full
Commission is not meeting, the Commission shall have an Executive
Committee of seven members, including the Chairman, Vice Chairman,
Treasurer and four other members elected annually by the Commission.
The Executive Committee, subject to the provisions of this compact
and consistent with the policies of the Commission, shall function as
provided in the bylaws of the Commission.
(b) The Commission may establish advisory and technical
committees, membership on which may include private persons and
public officials, in furthering any of its activities. Such
committees may consider any matter of concern to the Commission,
including problems of special interest to any party State and
problems dealing with particular types of taxes.
(c) The Commission may establish such additional committees as its
bylaws may provide.
Powers.
3. In addition to powers conferred elsewhere in this compact, the
Commission shall have power to:
(a) Study State and local tax systems and particular types of
State and local taxes.
(b) Develop and recommend proposals for an increase in uniformity
or compatibility of State and local tax laws with a view toward
encouraging the simplification and improvement of State and local tax
law and administration.
(c) Compile and publish information as in its judgment would
assist the party States in implementation of the compact and
taxpayers in complying with State and local tax laws.
(d) Do all things necessary and incidental to the administration
of its functions pursuant to this compact.
Finance.
4. (a) The Commission shall submit to the Governor or designated
officer or officers of each party State a budget of its estimated
expenditures for such period as may be required by the laws of that
State for presentation to the legislature thereof.
(b) Each of the Commission's budgets of estimated expenditures
shall contain specific recommendations of the amounts to be
appropriated by each of the party States. The total amount of
appropriations requested under any such budget shall be apportioned
among the party States as follows: one-tenth in equal shares; and the
remainder in proportion to the amount of revenue collected by each
party State and its subdivisions from income taxes, capital stock
taxes, gross receipts taxes, sales and use taxes. In determining such
amounts, the Commission shall employ such available public sources
of information as, in its judgment, present the most equitable and
accurate comparisons among the party States. Each of the Commission's
budgets of estimated expenditures and requests for appropriations
shall indicate the sources used in obtaining information employed in
applying the formula contained in this paragraph.
(c) The Commission shall not pledge the credit of any party State.
The Commission may meet any of its obligations in whole or in part
with funds available to it under paragraph 1 (i) of this Article:
provided that the Commission takes specific action setting aside such
funds prior to incurring any obligation to be met in whole or in
part in such manner. Except where the Commission makes use of funds
available to it under paragraph 1 (i), the Commission shall not incur
any obligation prior to the allotment of funds by the party States
adequate to meet the same.
(d) The Commission shall keep accurate accounts of all receipts
and disbursements. The receipts and disbursements of the Commission
shall be subject to the audit and accounting procedures established
under its bylaws. All receipts and disbursements of funds handled by
the Commission shall be audited yearly by a certified or licensed
public accountant and the report of the audit shall be included in
and become part of the annual report of the Commission.
(e) The accounts of the Commission shall be open at any reasonable
time for inspection by duly constituted officers of the party States
and by any persons authorized by the Commission.
(f) Nothing contained in this Article shall be construed to
prevent Commission compliance with laws relating to audit or
inspection of accounts by or on behalf of any government contributing
to the support of the Commission.
Article VII. Uniform Regulations and Forms.
1. Whenever any two or more party States, or subdivisions of party
States, have uniform or similar provisions of law relating to an
income tax, capital stock tax, gross receipts tax, sales or use tax,
the Commission may adopt uniform regulations for any phase of the
administration of such law, including assertion of jurisdiction to
tax, or prescribing uniform tax forms. The Commission may also act
with respect to the provisions of Article IV of this compact.
2. Prior to the adoption of any regulation, the Commission shall:
(a) As provided in its bylaws, hold at least one public hearing on
due notice to all affected party States and subdivisions thereof and
to all taxpayers and other persons who have made timely request of
the Commission for advance notice of its regulation-making
proceedings.
(b) Afford all affected party States and subdivisions and
interested persons an opportunity to submit relevant written data and
views, which shall be considered fully by the Commission.
3. The Commission shall submit any regulations adopted by it to
the appropriate officials of all party States and subdivisions to
which they might apply. Each such State and subdivision shall
consider any such regulation for adoption in accordance with its own
laws and procedures.
Article VIII. Interstate Audits.
1. This Article shall be in force only in those party States that
specifically provide therefor by statute.
2. Any party State or subdivision thereof desiring to make or
participate in an audit of any accounts, books, papers, records or
other documents may request the Commission to perform the audit on
its behalf. In responding to the request, the Commission shall have
access to and may examine, at any reasonable time, such accounts,
books, papers, records, and other documents and any relevant property
or stock of merchandise. The Commission may enter into agreements
with party States or their subdivisions for assistance in performance
of the audit. The Commission shall make charges, to be paid by the
State or local government or governments for which it performs the
service, for any audits performed by it in order to reimburse itself
for the actual costs incurred in making the audit.
3. The Commission may require the attendance of any person within
the State where it is conducting an audit or part thereof at a time
and place fixed by it within such State for the purpose of giving
testimony with respect to any account, book, paper, document, other
record, property or stock of merchandise being examined in connection
with the audit. If the person is not within the jurisdiction, he may
be required to attend for such purpose at any time and place fixed
by the Commission within the State of which he is a resident:
provided that such State has adopted this Article.
4. The Commission may apply to any court having power to issue
compulsory process for orders in aid of its powers and
responsibilities pursuant to this Article and any and all such courts
shall have jurisdiction to issue such orders. Failure of any person
to obey any such order shall be punishable as contempt of the issuing
court. If the party or subject matter on account of which the
Commission seeks an order is within the jurisdiction of the court to
which application is made, such application may be to a court in the
State or subdivision on behalf of which the audit is being made or a
court in the State in which the object of the order being sought is
situated. The provisions of this paragraph apply only to courts in a
State that has adopted this Article.
5. The Commission may decline to perform any audit requested if it
finds that its available personnel or other resources are
insufficient for the purpose or that, in the terms requested, the
audit is impractical of satisfactory performance. If the Commission,
on the basis of its experience, has reason to believe that an audit
of a particular taxpayer, either at a particular time or on a
particular schedule, would be of interest to a number of party States
or their subdivisions, it may offer to make the audit or audits, the
offer to be contingent on sufficient participation therein as
determined by the Commission.
6. Information obtained by any audit pursuant to this Article
shall be confidential and available only for tax purposes to party
States, their subdivisions or the United States. Availability of
information shall be in accordance with the laws of the States or
subdivisions on whose account the Commission performs the audit, and
only through the appropriate agencies or officers of such States or
subdivisions. Nothing in this Article shall be construed to require
any taxpayer to keep records for any period not otherwise required by
law.
7. Other arrangements made or authorized pursuant to law for
cooperative audit by or on behalf of the party States or any of their
subdivisions are not superseded or invalidated by this Article.
8. In no event shall the Commission make any charge against a
taxpayer for an audit.
9. As used in this Article, "tax," in addition to the meaning
ascribed to it in Article II, means any tax or license fee imposed in
whole or in part for revenue purposes.
Article IX. Arbitration.
1. Whenever the Commission finds a need for settling disputes
concerning apportionments and allocations by arbitration, it may
adopt a regulation placing this Article in effect, notwithstanding
the provisions of Article VII.
2. The Commission shall select and maintain an Arbitration Panel
composed of officers and employees of State and local governments and
private persons who shall be knowledgeable and experienced in
matters of tax law and administration.
3. Whenever a taxpayer who has elected to employ Article IV, or
whenever the laws of the party State or subdivision thereof are
substantially identical with the relevant provisions of Article IV,
the taxpayer, by written notice to the Commission and to each party
State or subdivision thereof that would be affected, may secure
arbitration of an apportionment or allocation, if he is dissatisfied
with the final administrative determination of the tax agency of the
State or subdivision with respect thereto on the ground that it would
subject him to double or multiple taxation by two or more party
States or subdivisions thereof. Each party State and subdivision
thereof hereby consents to the arbitration as provided herein, and
agrees to be bound thereby.
4. The Arbitration Board shall be composed of one person selected
by the taxpayer, one by the agency or agencies involved, and one
member of the Commission's Arbitration Panel. If the agencies
involved are unable to agree on the person to be selected by them,
such person shall be selected by lot from the total membership of the
Arbitration Panel. The two persons selected for the Board in the
manner provided by the foregoing provisions of this paragraph shall
jointly select the third member of the Board. If they are unable to
agree on the selection, the third member shall be selected by lot
from among the total membership of the Arbitration Panel. No member
of a Board selected by lot shall be qualified to serve if he is an
officer or employee or is otherwise affiliated with any party to the
arbitration proceeding. Residence within the jurisdiction of a party
to the arbitration proceeding shall not constitute affiliation within
the meaning of this paragraph.
5. The Board may sit in any State or subdivision party to the
proceeding, in the State of the taxpayer's incorporation, residence
or domicile, in any State where the taxpayer does business, or in any
place that it finds most appropriate for gaining access to evidence
relevant to the matter before it.
6. The Board shall give due notice of the times and places of its
hearings. The parties shall be entitled to be heard, to present
evidence, and to examine and cross-examine witnesses. The Board shall
act by majority vote.
7. The Board shall have power to administer oaths, take testimony,
subpoena and require the attendance of witnesses and the production
of accounts, books, papers, records, and other documents, and issue
commissions to take testimony. Subpoenas may be signed by any member
of the Board. In case of failure to obey a subpoena, and upon
application by the Board, any judge of a court of competent
jurisdiction of the State in which the Board is sitting or in which
the person to whom the subpoena is directed may be found may make an
order requiring compliance with the subpoena, and the court may
punish failure to obey the order as a contempt. The provisions of
this paragraph apply only in States that have adopted this Article.
8. Unless the parties otherwise agree the expenses and other costs
of the arbitration shall be assessed and allocated among the parties
by the Board in such manner as it may determine. The Commission
shall fix a schedule of compensation for members of Arbitration
Boards and of other allowable expenses and costs. No officer or
employee of a State or local government who serves as a member of a
Board shall be entitled to compensation therefor unless he is
required on account of his service to forego the regular compensation
attaching to his public employment, but any such Board member shall
be entitled to expenses.
9. The Board shall determine the disputed apportionment or
allocation and any matters necessary thereto. The determinations of
the Board shall be final for purposes of making the apportionment or
allocation, but for no other purpose.
10. The Board shall file with the Commission and with each tax
agency represented in the proceeding: the determination of the Board;
the Board's written statement of its reasons therefor; the record of
the Board's proceedings; and any other documents required by the
arbitration rules of the Commission to be filed.
11. The Commission shall publish the determinations of Boards
together with the statements of the reasons therefor.
12. The Commission shall adopt and publish rules of procedure and
practice and shall file a copy of such rules and of any amendment
thereto with the appropriate agency or officer in each of the party
States.
13. Nothing contained herein shall prevent at any time a written
compromise of any matter or matters in dispute, if otherwise lawful,
by the parties to the arbitration proceedings.
Article X. Entry Into Force and Withdrawal.
1. This compact shall enter into force when enacted into law by
any seven States. Thereafter, this compact shall become effective as
to any other State upon its enactment thereof. The Commission shall
arrange for notification of all party States whenever there is a new
enactment of the compact.
2. Any party State may withdraw from this compact by enacting a
statute repealing the same. No withdrawal shall affect any liability
already incurred by or chargeable to a party State prior to the time
of such withdrawal.
3. No proceeding commenced before an Arbitration Board prior to
the withdrawal of a State and to which the withdrawing State or any
subdivision thereof is a party shall be discontinued or terminated by
the withdrawal, nor shall the Board thereby lose jurisdiction over
any of the parties to the proceeding necessary to make a binding
determination therein.
Article XI. Effect on Other Laws and Jurisdiction.
Nothing in this compact shall be construed to:
(a) Affect the power of any State or subdivision thereof to fix
rates of taxation, except that a party State shall be obligated to
implement Article III 2 of this compact.
(b) Apply to any tax or fixed fee imposed for the registration of
a motor vehicle or any tax on motor fuel, other than a sales tax:
provided that the definition of "tax" in Article VIII 9 may apply for
the purposes of that Article and the Commission's powers of study
and recommendation pursuant to Article VI 3 may apply.
(c) Withdraw or limit the jurisdiction of any State or local court
or administrative officer or body with respect to any person,
corporation or other entity or subject matter, except to the extent
that such jurisdiction is expressly conferred by or pursuant to this
compact upon another agency or body.
(d) Supersede or limit the jurisdiction of any court of the United
States.
Article XII. Construction and Severability.
This compact shall be liberally construed so as to effectuate the
purposes thereof. The provisions of this compact shall be severable
and if any phrase, clause, sentence or provision of this compact is
declared to be contrary to the constitution of any State or of the
United States or the applicability thereof to any government, agency,
person or circumstance is held invalid, the validity of the
remainder of this compact and the applicability thereof to any
government, agency, person or circumstance shall not be affected
thereby. If this compact shall be held contrary to the constitution
of any State participating therein, the compact shall remain in full
force and effect as to the remaining party States and in full force
and effect as to the State affected as to all severable matters.