TITLE 42
State Affairs and Government
CHAPTER 42-64.20
Rebuild Rhode Island Tax Credit
SECTION 42-64.20-3
§ 42-64.20-3 Definitions.
As used in this chapter:
(1) "Adaptive Reuse" means the conversion of an existing
structure from the use for which it was constructed to a new use by maintaining
elements of the structure and adapting such elements to a new use.
(2) "Affiliate" means an entity that directly or indirectly
controls, is under common control with, or is controlled by the business.
Control exists in all cases in which the entity is a member of a controlled
group of corporations as defined pursuant to § 1563 of the Internal
Revenue Code of 1986 (26 U.S.C. § 1563) or the entity is an organization
in a group of organizations under common control as defined pursuant to
subsection (b) or (c) of § 414 of the Internal Revenue Code of 1986 (26
U.S.C. § 414). A taxpayer may establish by clear and convincing evidence,
as determined by the tax administrator, that control exists in situations
involving lesser percentages of ownership than required by those statutes. An
affiliate of a business may contribute to meeting either the capital investment
or full-time employee requirements of a business that applies for a credit
under this chapter.
(3) "Affordable housing" means housing for sale or rent with
combined rental costs or combined mortgage loan debt service, property taxes,
and required insurance that do not exceed thirty percent (30%) of the gross
annual income of a household earning up to eighty percent (80%) of the area
median income, as defined annually by the United States Department of Housing
and Urban Development.
(4) "Applicant" means a developer applying for a rebuild
Rhode Island tax credit under this chapter.
(5) "Business" means a corporation as defined in general laws
§ 44-11-1(4), or a partnership, an S corporation, a non-profit
corporation, a sole proprietorship, or a limited liability corporation. A
business shall include an affiliate of the business if that business applies
for a credit based upon any capital investment made by an affiliate.
(6) "Capital investment" in a real estate project means
expenses by a developer incurred after application for:
(i) Site preparation and construction, repair, renovation,
improvement, equipping, or furnishing on real property or of a building,
structure, facility, or improvement to real property;
(ii) Obtaining and installing furnishings and machinery,
apparatus, or equipment, including but not limited to material goods for the
operation of a business on real property or in a building, structure, facility,
or improvement to real property.
In addition to the foregoing, if a developer acquires or
leases a qualified development project, the capital investment made or acquired
by the seller or owner, as the case may be, if pertaining primarily to the
premises of the qualified development project, shall be considered a capital
investment by the developer and, if pertaining generally to the qualified
development project being acquired or leased, shall be allocated to the
premises of the qualified development project on the basis of the gross
leasable area of the premises in relation to the total gross leasable area in
the qualified development project. The capital investment described herein
shall be defined through rules and regulations promulgated by the commerce
corporation.
(7) "Certified historic structure" means a property which is
located in the state of Rhode Island and is
(i) Listed individually on the national register of historic
places; or
(ii) Listed individually in the state register of historic
places; or
(iii) Located in a registered historic district and certified
by either the Rhode Island historical preservation and heritage commission
created pursuant to § 42-45-2 or the Secretary of the Interior as being of
historic significance to the district.
(8) "Commerce corporation" means the Rhode Island commerce
corporation established pursuant to general laws § 42-64-1 et. seq.
(9) "Commercial" shall mean non-residential development.
(10) "Developer" means a person, firm, business, partnership,
association, political subdivision, or other entity that proposes to divide,
divides, or causes to be divided real property into a subdivision or proposes
to build, or builds a building or buildings or otherwise improves land or
existing structures, which division, building, or improvement qualifies for
benefits under this chapter.
(11) "Development" means the improvement of land through the
carrying out of building, engineering, or other operations in, on, over, or
under land, or the making of any material change in the use of any buildings or
land for the purposes of accommodating land uses.
(12) "Eligibility period" means the period in which a
developer may claim a tax credit under this act, beginning with the tax period
in which the commerce corporation accepts certification from the developer that
it has met the requirements of the act and extending thereafter for a term of
five (5) years.
(13) "Full-time employee" means a person who is employed by a
business for consideration for a minimum of at least thirty-five (35) hours per
week, or who renders any other standard of service generally accepted by custom
or practice as full-time employment, or who is employed by a professional
employer organization pursuant to an employee leasing agreement between the
business and the professional employer organization for a minimum of
thirty-five (35) hours per week, or who renders any other standard of service
generally accepted by custom or practice as full-time employment, and whose
wages are subject to withholding.
(14) "Hope community" means a municipality for which the five
(5) year average percentage of families with income below the federal poverty
level exceeds the state five (5) year average percentage, both as most recently
reported by the U.S. Department of Commerce, Bureau of the Census.
(15) "Mixed use" means a development comprising both
commercial and residential components.
(16) "Partnership" means an entity classified as a
partnership for federal income tax purposes.
(17) "Placed in service" means the earlier of i) substantial
construction or rehabilitation work has been completed which would allow for
occupancy of an entire structure or some identifiable portion of a structure,
as established in the application approved by the commerce corporation board or
ii) receipt by the developer of a certificate, permit or other authorization
allowing for occupancy of the project or some identifiable portion of the
project by the municipal authority having jurisdiction.
(18) "Project" means qualified development project as defined
under subsection (23) of this chapter.
(19) "Project area" means land or lands under common
ownership or control in which a qualified development project is located.
(20) "Project cost" means the costs incurred in connection
with the qualified development project or qualified residential or mixed use
project by the applicant until the issuance of a permanent certificate of
occupancy, or until such other time specified by the commerce corporation, for
a specific investment or improvement, as defined through rules and regulations
promulgated by the commerce corporation.
(21) "Project financing gap" means
(i) The part of the total project cost that remains to be
financed after all other sources of capital have been accounted for (such
sources will include, but not be limited to, developer-contributed capital),
which shall be defined through rules and regulations promulgated by the
commerce corporation, or
(ii) The amount of funds that the state may invest in a
project to gain a competitive advantage over a viable and comparable location
in another state by means described in this chapter.
(22) "Qualified development project" means a specific
construction project or improvement, including lands, buildings, improvements,
real and personal property or any interest therein, including lands under
water, riparian rights, space rights and air rights, acquired, owned, leased,
developed or redeveloped, constructed, reconstructed, rehabilitated or
improved, undertaken by a developer, owner or tenant, or both, within a
specific geographic area, meeting the requirements of this chapter, as set
forth in an application made to the commerce corporation.
(23) "Recognized historical structure" means a property which
is located in the state of Rhode Island and is commonly considered to be of
historic or cultural significance as determined by the commerce corporation in
consultation with the state historic preservation officer.
(24) "Residential" means a development of residential
dwelling units.
(25) "Targeted industry" means any advanced, promising or
otherwise prioritized industry identified in the economic development vision
and policy promulgated pursuant General Laws § 42-64.17-1 or, until such
time as any such economic development vision and policy is promulgated, as
identified by the commerce corporation.
(26) "Transit oriented development area" means an area in
proximity to transit infrastructure that will be further defined by regulation
of the commerce corporation in consultation with the Rhode Island department of
transportation.
(27) "Workforce housing" means housing for sale or rent with
combined rental costs or combined mortgage loan debt service, property taxes,
and required insurance that do not exceed thirty percent (30%) of the gross
annual income of a household earning between eighty percent (80%) and one
hundred and forty percent (140%) of the area median income, as defined annually
by the United States Department of Housing and Urban Development.
History of Section.
(P.L. 2015, ch. 141, art. 19, § 3.)