TITLE 42
State Affairs and Government
CHAPTER 42-64.5
Jobs Development Act
SECTION 42-64.5-2
§ 42-64.5-2 Definitions.
As used in this chapter, unless the context clearly indicates otherwise:
(1) "Adjusted current employment" means, for any taxable year
ending on or after July 1, 1995, the aggregate of the average daily number of
full-time equivalent active employees employed within the State by an eligible
company and its eligible subsidiaries during each taxable year.
(2) "Affiliated entity" means any corporation owned or
controlled by the same persons or shareholders who own or control an eligible
company.
(3) "Base employment" means, except as otherwise provided in
§ 42-64.5-7, the aggregate number of full-time equivalent active employees
employed within the State by an eligible company and its eligible subsidiaries
on July 1, 1994, or at the election of the eligible company, on an alternative
date as provided by § 42-64.5-5. In the case of a manufacturing company
which is ruined by disaster, the aggregate number of full-time equivalent
active employees employed at the destroyed facility would be zero, under which
circumstance the base employment date shall be July 1 of the calendar year in
which the disaster occurred. Only one base employment period can be elected for
purposes of a rate reduction by an eligible company.
(4) "Disaster" means an occurrence, natural or otherwise,
which results in the destruction of sixty percent (60%) or more of an operating
manufacturing business facility in this state, thereby making the production of
products by the eligible company impossible and as a result active employees of
the facility are without employment in that facility. However, disaster does
not include any damage resulting from the willful act of the owner(s) of the
manufacturing business facility.
(5) "Eligible company" means any corporation, state bank,
federal savings bank, trust company, national banking association, bank holding
company, loan and investment company, mutual savings bank, credit union,
building and loan association, insurance company, investment company,
broker-dealer company, manufacturing company, telecommunications company or
surety company or an eligible subsidiary of any of the foregoing. An eligible
company does not have to be in existence, be qualified to do business in the
state or have any employees in this state at the time its base employment is
determined.
(6) "Eligible subsidiary" means each corporation eighty
percent (80%) or more of the outstanding common stock of which is owned by an
eligible company.
(7) "Full-time equivalent active employee" means any employee
of an eligible company who: (1) works a minimum of thirty (30) hours per week
within the State, or two (2) or more part-time employees whose combined weekly
hours equal or exceed thirty (30) hours per week within the State; and (2)
earns no less than one hundred fifty percent (150%) of the hourly minimum wage
prescribed by Rhode Island law; provided, however, for tax years ending after
the later of July 1, 2003 and the first tax year that an eligible company
qualifies for a rate reduction pursuant to § 42-64.5-3, for purposes of
this section, one hundred fifty percent (150%) of the hourly minimum wage
prescribed by Rhode Island law shall mean one hundred fifty percent (150%) of
the hourly minimum wage prescribed by Rhode Island law at: (a) the time the
employee was first treated as a full-time equivalent active employee during a
tax year that the eligible company qualified for a rate reduction pursuant to
§ 42-64.5-3, or, if later, (b) the time the employee first earned at least
one hundred fifty percent (150%) of the hourly minimum wage prescribed by Rhode
Island law as an employee of the eligible company. For eligible companies
qualifying on or after July 1, 2009 for a rate reduction pursuant to §
42-64.5-3, the term "full-time equivalent active employee" means any employee
of an eligible company who: (1) works a minimum of thirty (30) hours per week
within the state; (2) earns healthcare insurance benefits, and retirement
benefits; and (3) earns no less than two hundred fifty percent (250%) of the
hourly minimum wage prescribed by Rhode Island law at the later of: (i) the
time the employee was first treated as a full-time equivalent active employee
during a tax year that the eligible company qualified for a rate reduction
pursuant to § 42-64.5-3; or (ii) the time the employee first earned at
least two hundred fifty percent (250%) of the hourly minimum wage prescribed by
Rhode Island law as an employee of the eligible company. For eligible companies
qualifying before July 1, 2009 for a rate reduction pursuant to §
42-64.5-3, any new "full-time equivalent active employee", who replaces an
existing "full-time equivalent active employee", shall meet the following
standards to remain eligible: (1) works a minimum of thirty (30) hours per week
within the state; (2) earns healthcare insurance benefits, and retirement
benefits; and (3) earns no less than two hundred fifty percent (250%) of the
hourly minimum wage prescribed by Rhode Island law at the later of: (i) the
time the employee was first treated as a full-time equivalent active employee
during a tax year that the eligible company qualified for a rate reduction
pursuant to § 42-64.5-3; or (ii) the time the employee first earned at
least two hundred fifty percent (250%) of the hourly minimum wage prescribed by
Rhode Island law as an employee of the eligible company.
(8) "Initial new employment level" means the number of units
of new employment reported by an eligible company in 1997, or, if applicable,
the third taxable year following the base employment period election set forth
in § 42-64.5-5.
(9)(i) "New employment" means for each taxable year the
amount of adjusted current employment for each taxable year minus the amount of
base employment, but in no event less than zero; provided, however, no eligible
company is permitted to transfer, assign or hire employees who are already
employed within the State by such eligible company from itself or any
affiliated entity or utilize any other artifice or device for the purpose of
artificially creating new employees in order to qualify for the rate reduction
provided for in this chapter.
(ii) Except as provided in § 42-64.5-7, "new employment"
shall not include employees already employed in this state who become employees
of an eligible company as a result of an acquisition of an existing company by
purchase, merger, or otherwise, if the existing company was eligible for a rate
reduction. In the case of a manufacturing company that suffers a disaster, it
shall mean any employment retained or added as the result of reconstruction of
the manufacturing facility.
(10) "Rate reduction" means the reduction in tax rate
specified in § 42-64.5-4.
(11) "Small business concern" means, except as otherwise
provided in § 42-64.5-7, any eligible company which has a base employment
level of less than one hundred (100); provided, however, that a
telecommunications company may not qualify as a small business concern.
(12) "State" means the State of Rhode Island and Providence
Plantations.
(13) "Telecommunications company" means any public service
company or corporation whose rate of taxation is determined under §
44-13-4(4).
(14) "Total employment" for an eligible company as of any
date means the total number of full-time equivalent active employees employed
within the State by the eligible company and its eligible subsidiaries on such
date.
(15) "Units of new employment" means: (i) for eligible
companies which are not small business concerns, the amount of new employment
divided by fifty (50), rounded down to the nearest multiple of fifty (50), and
(ii) for eligible companies which are small business concerns the amount of new
employment divided by ten (10), rounded down to the nearest multiple of ten
(10); provided, however, that an eligible company (other than an eligible
company that is a telecommunications company) with adjusted current employment
of one hundred (100) or more employees in its first year of operation or in any
other period following the date its base employment is determined shall
determine its units of new employment by dividing the first one hundred (100)
employees less its base employment by ten (10), rounded down to the nearest
multiple of ten (10), and by dividing the number of additional employees in
excess of one hundred (100) by fifty (50), rounded down to the nearest multiple
of fifty (50).
History of Section.
(P.L. 1994, ch. 84, § 1; P.L. 1998, ch. 111, § 1; P.L. 2000, ch. 279,
§ 1; P.L. 2001, ch. 77, art. 7, § 4; P.L. 2003, ch. 383, § 2;
P.L. 2003, ch. 385, § 2; P.L. 2004, ch. 333, § 1; P.L. 2004, ch. 396,
§ 1; P.L. 2006, ch. 216, § 41; P.L. 2009, ch. 68, art. 16, §
12.)
