Bill Text: MN HF154 | 2013-2014 | 88th Legislature | Introduced
Bill Title: Performance rewards on fast investment today program created, tax benefits and funding provided, and money appropriated.
Spectrum: Bipartisan Bill
Status: (Introduced - Dead) 2013-01-24 - Introduction and first reading, referred to Jobs and Economic Development Finance and Policy [HF154 Detail]
Download: Minnesota-2013-HF154-Introduced.html
1.2relating to economic development; creating the performance rewards on fast
1.3investment today program; providing tax benefits; appropriating money;
1.4proposing coding for new law in Minnesota Statutes, chapter 469.
1.5BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.6 Section 1. [469.352] PERFORMANCE REWARDS ON FAST INVESTMENT
1.7TODAY.
1.8 Subdivision 1. Definitions. (a) For purposes of this section, the following terms
1.9have the meanings given.
1.10(b) "New full-time employee" means an employee who:
1.11(1) begins work at a qualified PROFIT business during the taxable year;
1.12(2) was not previously on the payroll of the qualified PROFIT business; and
1.13(3) has annualized expected hours of work of at least 1,950 hours.
1.14(c) "Qualified performance rewards on fast investment today (PROFIT) business"
1.15means a business that is certified by the commissioner under this section.
1.16(d) "Taxing authority" means a county, home rule charter or statutory city, or town.
1.17(e) "Wages" is defined as provided in section 290.92, subdivision 1, clause (1).
1.18 Subd. 2. Application and certification. (a) In order to qualify for the tax benefits
1.19in subdivision 4, a business must submit an application to each taxing authority that
1.20may be affected by the tax benefits under subdivision 5, 6, or 7, or to a joint powers
1.21board established under section 471.59 acting on behalf of local government units with
1.22jurisdiction to tax in the applicable geographic area. If the affected taxing authorities
1.23determine that the increased business activities will benefit the local economy, the taxing
1.24authorities may notify the commissioner that the business has received local approval to
2.1be certified as a qualified PROFIT business. In making this determination, each taxing
2.2authority must consider the conditions listed in paragraph (e) and subdivision 3, paragraph
2.3(a), clauses (1) and (2).
2.4(b) In lieu of paragraph (a), one or more taxing authorities or a joint powers board
2.5may provide a general local approval to the commissioner that applies to any business
2.6seeking approval to be certified as a qualified PROFIT business that conducts or plans
2.7to conduct business operations within an area subject to the jurisdiction of the taxing
2.8authority or authorities or joint powers board.
2.9(c) Upon receiving notification of local approval under paragraph (a) or (b), the
2.10commissioner shall review the determination by the local taxing authorities or joint
2.11powers board and consider the conditions listed in paragraph (e) and subdivision 3,
2.12paragraph (a), clauses (1) and (2), to determine whether to certify a business as a qualified
2.13PROFIT business.
2.14(d) The applications required under paragraph (a) must be in the form and be made
2.15under the procedures specified by the commissioner.
2.16(e) Prior to certification of a business under this section, the commissioner shall
2.17consider the following:
2.18(1) the economic outlook of the industry in which the business engages;
2.19(2) the projected sales of the business that will be generated from outside the state
2.20of Minnesota;
2.21(3) how the business will build on existing regional, national, and international
2.22strengths to diversify the state's economy;
2.23(4) whether the business activity would occur without financial assistance;
2.24(5) the effect of financial assistance on industry competitors; and
2.25(6) any other criteria the commissioner deems necessary.
2.26 Subd. 3. Requirements. (a) To receive certification as a qualified PROFIT business,
2.27a business must satisfy all of the following conditions:
2.28(1) the business is engaged in, within Minnesota, one of the following as its primary
2.29business activity:
2.30(i) manufacturing;
2.31(ii) warehousing;
2.32(iii) distribution;
2.33(iv) information technology;
2.34(v) finance;
2.35(vi) insurance; or
2.36(vii) professional or technical services;
3.1(2) the business must not be primarily engaged in lobbying, political consulting,
3.2leisure, hospitality, or professional services provided by attorneys, accountants, business
3.3consultants, physicians, or health care consultants; and
3.4(3) the business must enter into a binding agreement with the appropriate local
3.5government unit in which the qualified PROFIT business is located and the commissioner
3.6to create at least ten new full-time employee positions, earning at least $35,000 in annual
3.7wages for businesses located in the seven-county metropolitan area as defined in section
3.8473.121, subdivision 2, or at least $27,000 in annual wages in all other areas and invest
3.9at least $500,000 in a construction project that includes a new, expanding, or remodeled
3.10facility within two years of being certified as a qualified PROFIT business. The agreement
3.11may also include additional job creation goals as determined by the commissioner and the
3.12business and that must be achieved in order for the business to continue to be eligible for
3.13the tax benefits after the qualified PROFIT business initially meets the two-year goals.
3.14(b) For purposes of this section, a business includes an individual, corporation,
3.15partnership, limited liability company, association, or any other entity.
3.16 Subd. 4. Tax benefits. (a) A business that is certified as a qualified PROFIT
3.17business is eligible for the following tax benefits for up to 12 years from the date the
3.18commissioner certifies the business as a qualified PROFIT business under this section:
3.19(1) the property tax refund for certain improvements as provided in subdivision 5;
3.20(2) a refund for sales and use tax and any local sales and use taxes on qualifying
3.21purchases made as provided in subdivision 6; and
3.22(3) a refund for the state sales tax on motor vehicles and any local sales tax on motor
3.23vehicles as provided under subdivision 7.
3.24(b) A refund of property, sales, or motor vehicle taxes paid, as described under
3.25paragraph (a), is provided to a qualified PROFIT business when two-year construction
3.26and employment goals under subdivision 3, paragraph (a), clause (3), are achieved and
3.27upon filing with the commissioner of revenue a claim for refund in the form and manner
3.28prescribed by the commissioner of revenue. Following achievement of the two-year goals,
3.29a qualified PROFIT business is eligible for a refund of property, sales, or motor vehicle
3.30taxes paid, as described under paragraph (a), in the previous year if the business meets the
3.31additional job creation goals. The amount of the refund is equal to the amount of property,
3.32sales, or motor vehicle taxes paid, as described under paragraph (a), in the previous calendar
3.33year if the business meets its additional job creation goals. If the business does not meet
3.34its additional job creation goals, then the refund is equal to the amount of property, sales,
3.35or motor vehicle taxes paid, as described under paragraph (a), in the previous calendar
4.1year multiplied by the number of new full-time employee positions over the number of
4.2full-time employee positions agreed to under subdivision 3, paragraph (a), clause (3).
4.3 Subd. 5. Property tax refund. (a) The value of improvements made to real property
4.4and personal property, classified under section273.13, subdivision 24 , and owned and
4.5operated by a qualified PROFIT business as defined under this section, may be refunded
4.6as provided in this subdivision.
4.7 (b) For property to qualify for the refund, the occupant must be certified by the
4.8commissioner as a qualified PROFIT business under this section.
4.9 (c) A qualified PROFIT business is eligible for the refund beginning the first
4.10assessment year after the business is certified by the commissioner. To be eligible, the
4.11property must be occupied by July 1 of the assessment year by a qualified PROFIT business.
4.12 (d) A qualified PROFIT business must notify the commissioner of revenue in writing
4.13of eligibility under this subdivision by July 1 in order to begin receiving the refund under
4.14this subdivision in the following year.
4.15(e) The refund is distributed as provided in subdivision 4, paragraph (b), and
4.16continues annually while the business is certified under this section as long as the business
4.17continues to meet the job creation goals.
4.18 Subd. 6. Sales and use tax refund. (a) A qualified PROFIT business is eligible
4.19for a refund of taxes paid under chapter 297A on the purchase and use of construction
4.20materials, services, and supplies used or consumed in, including equipment incorporated
4.21into, real property owned by a qualified PROFIT business if used in the conduct of a
4.22qualified PROFIT business.
4.23(b) The refund under this subdivision applies to a local sales and use tax regardless
4.24of whether the local sales tax is imposed on the sales taxable as defined in chapter 297A.
4.25(c) The refund under this subdivision applies regardless of whether the purchases are
4.26made by the qualified PROFIT business or a contractor.
4.27(d) The tax must be refunded in the manner provided under subdivision 4, paragraph
4.28(b), subject to the job creation and construction agreement under subdivision 3, paragraph
4.29(a), clause (3).
4.30 Subd. 7. Motor vehicle tax refund. (a) A qualified PROFIT business is eligible
4.31for a refund of taxes paid under chapter 297B on the purchase of a motor vehicle, if the
4.32motor vehicle is primarily used as part of or in direct support of the business operations of
4.33a qualified PROFIT business. The refund applies to sales if the purchase was made and
4.34delivery received during the duration of a qualified PROFIT business certification. The
4.35refund also applies to any local sales and use tax.
5.1(b) The tax must be refunded in the manner provided under subdivision 4, paragraph
5.2(b), subject to the job creation and construction agreement under subdivision 3, paragraph
5.3(a), clause (3).
5.4 Subd. 8. Appropriation. An amount sufficient to pay the refunds under subdivision
5.54 is annually appropriated to the commissioner of revenue from the general fund.
5.6EFFECTIVE DATE.This section is effective for taxes payable in 2014 and
5.7thereafter and for sales and purchases made after July 31, 2013, and thereafter.
1.3investment today program; providing tax benefits; appropriating money;
1.4proposing coding for new law in Minnesota Statutes, chapter 469.
1.5BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.6 Section 1. [469.352] PERFORMANCE REWARDS ON FAST INVESTMENT
1.7TODAY.
1.8 Subdivision 1. Definitions. (a) For purposes of this section, the following terms
1.9have the meanings given.
1.10(b) "New full-time employee" means an employee who:
1.11(1) begins work at a qualified PROFIT business during the taxable year;
1.12(2) was not previously on the payroll of the qualified PROFIT business; and
1.13(3) has annualized expected hours of work of at least 1,950 hours.
1.14(c) "Qualified performance rewards on fast investment today (PROFIT) business"
1.15means a business that is certified by the commissioner under this section.
1.16(d) "Taxing authority" means a county, home rule charter or statutory city, or town.
1.17(e) "Wages" is defined as provided in section 290.92, subdivision 1, clause (1).
1.18 Subd. 2. Application and certification. (a) In order to qualify for the tax benefits
1.19in subdivision 4, a business must submit an application to each taxing authority that
1.20may be affected by the tax benefits under subdivision 5, 6, or 7, or to a joint powers
1.21board established under section 471.59 acting on behalf of local government units with
1.22jurisdiction to tax in the applicable geographic area. If the affected taxing authorities
1.23determine that the increased business activities will benefit the local economy, the taxing
1.24authorities may notify the commissioner that the business has received local approval to
2.1be certified as a qualified PROFIT business. In making this determination, each taxing
2.2authority must consider the conditions listed in paragraph (e) and subdivision 3, paragraph
2.3(a), clauses (1) and (2).
2.4(b) In lieu of paragraph (a), one or more taxing authorities or a joint powers board
2.5may provide a general local approval to the commissioner that applies to any business
2.6seeking approval to be certified as a qualified PROFIT business that conducts or plans
2.7to conduct business operations within an area subject to the jurisdiction of the taxing
2.8authority or authorities or joint powers board.
2.9(c) Upon receiving notification of local approval under paragraph (a) or (b), the
2.10commissioner shall review the determination by the local taxing authorities or joint
2.11powers board and consider the conditions listed in paragraph (e) and subdivision 3,
2.12paragraph (a), clauses (1) and (2), to determine whether to certify a business as a qualified
2.13PROFIT business.
2.14(d) The applications required under paragraph (a) must be in the form and be made
2.15under the procedures specified by the commissioner.
2.16(e) Prior to certification of a business under this section, the commissioner shall
2.17consider the following:
2.18(1) the economic outlook of the industry in which the business engages;
2.19(2) the projected sales of the business that will be generated from outside the state
2.20of Minnesota;
2.21(3) how the business will build on existing regional, national, and international
2.22strengths to diversify the state's economy;
2.23(4) whether the business activity would occur without financial assistance;
2.24(5) the effect of financial assistance on industry competitors; and
2.25(6) any other criteria the commissioner deems necessary.
2.26 Subd. 3. Requirements. (a) To receive certification as a qualified PROFIT business,
2.27a business must satisfy all of the following conditions:
2.28(1) the business is engaged in, within Minnesota, one of the following as its primary
2.29business activity:
2.30(i) manufacturing;
2.31(ii) warehousing;
2.32(iii) distribution;
2.33(iv) information technology;
2.34(v) finance;
2.35(vi) insurance; or
2.36(vii) professional or technical services;
3.1(2) the business must not be primarily engaged in lobbying, political consulting,
3.2leisure, hospitality, or professional services provided by attorneys, accountants, business
3.3consultants, physicians, or health care consultants; and
3.4(3) the business must enter into a binding agreement with the appropriate local
3.5government unit in which the qualified PROFIT business is located and the commissioner
3.6to create at least ten new full-time employee positions, earning at least $35,000 in annual
3.7wages for businesses located in the seven-county metropolitan area as defined in section
3.8473.121, subdivision 2, or at least $27,000 in annual wages in all other areas and invest
3.9at least $500,000 in a construction project that includes a new, expanding, or remodeled
3.10facility within two years of being certified as a qualified PROFIT business. The agreement
3.11may also include additional job creation goals as determined by the commissioner and the
3.12business and that must be achieved in order for the business to continue to be eligible for
3.13the tax benefits after the qualified PROFIT business initially meets the two-year goals.
3.14(b) For purposes of this section, a business includes an individual, corporation,
3.15partnership, limited liability company, association, or any other entity.
3.16 Subd. 4. Tax benefits. (a) A business that is certified as a qualified PROFIT
3.17business is eligible for the following tax benefits for up to 12 years from the date the
3.18commissioner certifies the business as a qualified PROFIT business under this section:
3.19(1) the property tax refund for certain improvements as provided in subdivision 5;
3.20(2) a refund for sales and use tax and any local sales and use taxes on qualifying
3.21purchases made as provided in subdivision 6; and
3.22(3) a refund for the state sales tax on motor vehicles and any local sales tax on motor
3.23vehicles as provided under subdivision 7.
3.24(b) A refund of property, sales, or motor vehicle taxes paid, as described under
3.25paragraph (a), is provided to a qualified PROFIT business when two-year construction
3.26and employment goals under subdivision 3, paragraph (a), clause (3), are achieved and
3.27upon filing with the commissioner of revenue a claim for refund in the form and manner
3.28prescribed by the commissioner of revenue. Following achievement of the two-year goals,
3.29a qualified PROFIT business is eligible for a refund of property, sales, or motor vehicle
3.30taxes paid, as described under paragraph (a), in the previous year if the business meets the
3.31additional job creation goals. The amount of the refund is equal to the amount of property,
3.32sales, or motor vehicle taxes paid, as described under paragraph (a), in the previous calendar
3.33year if the business meets its additional job creation goals. If the business does not meet
3.34its additional job creation goals, then the refund is equal to the amount of property, sales,
3.35or motor vehicle taxes paid, as described under paragraph (a), in the previous calendar
4.1year multiplied by the number of new full-time employee positions over the number of
4.2full-time employee positions agreed to under subdivision 3, paragraph (a), clause (3).
4.3 Subd. 5. Property tax refund. (a) The value of improvements made to real property
4.4and personal property, classified under section
4.5operated by a qualified PROFIT business as defined under this section, may be refunded
4.6as provided in this subdivision.
4.7 (b) For property to qualify for the refund, the occupant must be certified by the
4.8commissioner as a qualified PROFIT business under this section.
4.9 (c) A qualified PROFIT business is eligible for the refund beginning the first
4.10assessment year after the business is certified by the commissioner. To be eligible, the
4.11property must be occupied by July 1 of the assessment year by a qualified PROFIT business.
4.12 (d) A qualified PROFIT business must notify the commissioner of revenue in writing
4.13of eligibility under this subdivision by July 1 in order to begin receiving the refund under
4.14this subdivision in the following year.
4.15(e) The refund is distributed as provided in subdivision 4, paragraph (b), and
4.16continues annually while the business is certified under this section as long as the business
4.17continues to meet the job creation goals.
4.18 Subd. 6. Sales and use tax refund. (a) A qualified PROFIT business is eligible
4.19for a refund of taxes paid under chapter 297A on the purchase and use of construction
4.20materials, services, and supplies used or consumed in, including equipment incorporated
4.21into, real property owned by a qualified PROFIT business if used in the conduct of a
4.22qualified PROFIT business.
4.23(b) The refund under this subdivision applies to a local sales and use tax regardless
4.24of whether the local sales tax is imposed on the sales taxable as defined in chapter 297A.
4.25(c) The refund under this subdivision applies regardless of whether the purchases are
4.26made by the qualified PROFIT business or a contractor.
4.27(d) The tax must be refunded in the manner provided under subdivision 4, paragraph
4.28(b), subject to the job creation and construction agreement under subdivision 3, paragraph
4.29(a), clause (3).
4.30 Subd. 7. Motor vehicle tax refund. (a) A qualified PROFIT business is eligible
4.31for a refund of taxes paid under chapter 297B on the purchase of a motor vehicle, if the
4.32motor vehicle is primarily used as part of or in direct support of the business operations of
4.33a qualified PROFIT business. The refund applies to sales if the purchase was made and
4.34delivery received during the duration of a qualified PROFIT business certification. The
4.35refund also applies to any local sales and use tax.
5.1(b) The tax must be refunded in the manner provided under subdivision 4, paragraph
5.2(b), subject to the job creation and construction agreement under subdivision 3, paragraph
5.3(a), clause (3).
5.4 Subd. 8. Appropriation. An amount sufficient to pay the refunds under subdivision
5.54 is annually appropriated to the commissioner of revenue from the general fund.
5.6EFFECTIVE DATE.This section is effective for taxes payable in 2014 and
5.7thereafter and for sales and purchases made after July 31, 2013, and thereafter.
