Section 41-10-44.8Tax credits, job development fees and other incentives.
(a) Upon the issuance by the authority of its project obligations for the purpose of financing a project for an approved company with respect to which the authority adopted a resolution accepting the project prior to January 16, 1995, the approved company:
(1) Shall receive a credit against the corporate income tax levied by Section 40-18-31 that otherwise would be owed to the state in any year by the approved company on its income generated by or arising out of the project, such credit not to exceed the lesser of (i) the amount due in tax, or (ii) the amount paid by the approved company pursuant to a financing agreement in the year for which the tax is due, corresponding to debt service on the project obligations; and
(2) May elect to withhold and retain the aggregate job development fees described in paragraph (b) below, but only to the extent that debt service payments under the financing agreement(s) exceed the income tax credit permitted in subdivision (1) above.
The incentives described in (1) and (2) above shall be available to an approved company whose project is financed by the authority's project obligations for a period commencing on the date of issuance of such project obligations and, subject to the provisions of paragraph (c) below, ending on the first to occur of the following: (i) the termination of the financing agreement(s) entered into with respect to such project obligations; (ii) the maturity or earlier redemption or payment of the project obligations; or (iii) 25 years from the date the project is first placed in service. Immediately upon issuing any project obligations, the authority shall provide to the department the name of the approved company for whose benefit such project obligations were issued and sufficient information to determine the duration of the corporate income tax credit and the job development fees described in (1) and (2) above, respectively.
(b) As provided in subdivision (a) (2) above, an approved company may require, as a condition of employment, that each person employed by the approved company at the project financed by the authority's project obligations agree to permit the approved company to deduct and withhold a job development fee not to exceed five percent from the gross wages paid to such employee by the approved company. Job development fees shall not be collected from persons employed by an approved company prior to the entry by such approved company into an agreement with the authority for financing of a project. If an approved company elects to collect a job development fee, it shall deduct the fee from the paycheck of each new employee and shall make its payroll books and records available for inspection by the authority or its designee at such reasonable times as the authority may request. Each approved company collecting a job development fee shall be required to file with the authority such information and documentation respecting the imposition and collection of such fee as the authority may require. Each approved company collecting a job development fee shall be permitted a credit against the withholding tax liability provided in Section 40-18-76 otherwise owed to the state, such credit not to exceed the lesser of (i) the amount of such tax, or (ii) the aggregate job development fees withheld.
Each employee who has been assessed a job development fee, as provided above, shall be entitled to a credit against his or her state income taxes in an amount equal to 100 percent of the job development fee withheld from the employee's wages during the calendar year. Each employee who has been assessed a job development fee as provided above shall be entitled to a credit against his or her withholding tax liability calculated pursuant to Section 40-18-71 in an amount equal to 100 percent of the job development fee withheld from the employee's wages during the calendar year.
(c) If an approved company fails to achieve the level of capital investment or employment anticipated at the time the authority agreed to finance its project, the department may, after notice and hearing, reduce or suspend all or any part of such incentives until such time as the anticipated capital investment and employment levels are met; provided, however, that such incentives shall not be suspended retroactively. The authority may provide in the financing agreement(s) entered into in connection with a project for the levels of capital investment and employment expected to be achieved and for the time period(s) in which such levels are to be achieved.
(d) The board of directors of the authority may, upon the written request of any local industrial development board, industrial development association, chamber of commerce or other similar local entity, solicit and request from any person, corporation, foundation or other legal entity any gift, grant, contribution, loan or other kind of aid or assistance, whether in the form of property, services or monies, which the board of directors deems necessary to provide to an approved company in order to induce such company to undertake a major project within the state. Any such solicitation or request by the authority may be made only upon the condition that the person, corporation, foundation or other legal entity from whom assistance is requested agrees to continue its support for local economic development activities. The authority shall only be permitted to solicit assistance with respect to identified major projects and shall not solicit contributions for any general purpose. Any assistance which is provided to the authority and not used for the major project for which it was requested, shall be returned pro rata to the persons, corporations, foundations or other entities providing such assistance. The decision to provide all or a portion of the assistance requested by the authority shall lie solely within the discretion of the person, corporation, foundation or other legal entity receiving the request. Any assistance provided to the authority pursuant to the provisions of this subsection (d) is hereby deemed to have a valid business purpose and shall be allowed as a deduction against the corporate income tax levied by Section 40-18-31, the personal income tax levied by Section 40-18-2, or the financial institution excise tax levied by Section 40-16-4, whichever is appropriate. If assistance is provided to the authority by any person, corporation, foundation or other legal entity, whether regulated or non-regulated, the cost of such assistance will be deemed to be a prudent, legal and non-discriminatory expenditure for all purposes of state law and regulation.
(Acts 1993, 1st Ex. Sess., No. 93-851, p. 79, §1; Acts 1995, No. 95-187, p. 250, §12.)