Bill Text: MS SB2563 | 2020 | Regular Session | Introduced
Bill Title: Workforce development; create study committee on and require agencies, departments and institutions to report certain monies related to.
Spectrum: Bipartisan Bill
Status: (Passed) 2020-07-08 - Approved by Governor [SB2563 Detail]
Download: Mississippi-2020-SB2563-Introduced.html
MISSISSIPPI LEGISLATURE
2020 Regular Session
To: Economic and Workforce Development
By: Senator(s) Parker
Senate Bill 2563
AN ACT TO CREATE "THE INCENTIVES TRANSPARENCY FOR A PROSPEROUS MISSISSIPPI ACT"; TO DEFINE TERMS; TO SET INITIAL REQUIREMENTS FOR THE AWARDING OF AN ECONOMIC INCENTIVE BY THE MISSISSIPPI DEVELOPMENT AUTHORITY TO A CERTIFIED APPLICANT FOR A QUALIFIED ECONOMIC DEVELOPMENT PROJECT, INCLUDING A FINDING BY THE AUTHORITY THAT THE PROJECT IS IN THE BEST INTERESTS OF THE STATE, AND A FISCAL IMPACT STUDY BY THE UNIVERSITY RESEARCH CENTER OR ANOTHER ENTITY IN CONSULTATION WITH THE CENTER; TO REQUIRE THAT A CERTIFIED APPLICANT AWARDED AN ECONOMIC INCENTIVE ENTER INTO A MEMORANDUM OF UNDERSTANDING WITH THE STATE THROUGH THE AUTHORITY, CONTAINING PERFORMANCE MEASURES FOR ATTAINMENT WITHIN THE FIRST FIVE YEARS OF THE AWARD OF THE ECONOMIC INCENTIVE; TO PROVIDE THAT FAILURE TO MEET THE MEASURES WILL DISQUALIFY AN APPLICANT FROM THE AWARD OF AN ECONOMIC INCENTIVE FOR FIVE YEARS OR UNTIL THE PRIOR INCENTIVE IS REPAID, WHICHEVER OCCURS FIRST; TO REQUIRE THAT A CERTIFIED APPLICANT FILE AN ANNUAL REPORT WITH THE AUTHORITY FOR ANY QUALIFIED ECONOMIC DEVELOPMENT PROJECT FOR THE TAX YEAR ENDING DURING THE IMMEDIATELY PRECEDING CALENDAR YEAR; TO SPECIFY THE CONTENT OF THE CERTIFIED APPLICANT'S ANNUAL REPORT; TO REQUIRE THAT THE EXECUTIVE DIRECTOR OF THE AUTHORITY FILE A REPORT WITH THE STATE CONTAINING DATA FOR EACH YEAR THAT THE CERTIFIED APPLICANT RECEIVED AN ECONOMIC INCENTIVE; TO SPECIFY THE CONTENT OF THE AUTHORITY'S ANNUAL REPORT; TO CLARIFY THAT SECTIONS 2 THROUGH 6 OF THIS ACT APPLY ONLY TO CERTIFIED APPLICANTS FOR ECONOMIC INCENTIVES AWARDED AFTER JULY 1, 2020, WITH APPLICANTS AWARDED ECONOMIC INCENTIVES BEFORE THAT DATE HAVING THE OPTION OF FILING THE APPLICABLE INFORMATION VOLUNTARILY; TO AMEND SECTION 57-1-14, MISSISSIPPI CODE OF 1972, TO EXCLUDE FROM CONFIDENTIALITY INFORMATION REQUIRED TO BE INCLUDED IN THE ANNUAL REPORT; TO REPEAL AND RECODIFY SECTION 57-1-12, MISSISSIPPI CODE OF 1972, WHICH REQUIRES THE MISSISSIPPI DEVELOPMENT AUTHORITY TO FILE ANNUAL REPORTS DESCRIBING ALL ASSISTANCE PROVIDED UNDER THE ADVANTAGE MISSISSIPPI INITIATIVE; TO REPEAL AND RECODIFY SECTION 57-1-12.1, MISSISSIPPI CODE OF 1972, WHICH REQUIRES THE MISSISSIPPI DEVELOPMENT AUTHORITY TO FILE QUARTERLY REPORTS REGARDING THE NET ECONOMIC IMPACT OF CERTAIN INCENTIVES OR OTHER FORMS OF ASSISTANCE; TO REPEAL SECTION 57-1-12.2, MISSISSIPPI CODE OF 1972, WHICH REQUIRES THE DEPARTMENT TO FILE ANNUAL REPORTS REGARDING TAX CREDITS, LOANS, REBATES AND GRANTS MADE, APPROVED OR AWARDED AS THE RESULT OF NEGOTIATIONS INVOLVING ECONOMIC DEVELOPMENT PROJECTS; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. Short title. Sections 1 through 8 of this act shall be known and may be cited as the "Incentives Transparency for a Prosperous Mississippi Act."
SECTION 2. Definitions. For purposes of Sections 2 though 6 of this act, the following words shall have the meanings ascribed herein unless the context otherwise requires:
(a) "Certified applicant" or "applicant" means any corporation, partnership, company or other entity or individual receiving one or more economic incentives worth, in total, in excess of One Million Dollars ($1,000,000.00).
(b) "Economic incentive" or "incentive" means any tax credits, deductions, exemptions, abatements, preferential rates, rebates, grants, loans or other benefits awarded by the department where the government promises to forgo tax revenues or provide funds, and in exchange the certified applicant agrees to take some action that contributes to economic development.
(c) "Qualified economic development project" means a business or other economic development project receiving one or more economic incentives worth, in total, in excess of One Million Dollars ($1,000,000.00).
(d) "Full-time employee" means an individual who is employed for consideration for at least thirty-five (35) hours each week or who renders any other standard of service generally accepted by custom or specified by contract as full-time employment.
(e) "Part-time employee" means an individual who is employed for consideration for less than thirty-five (35) hours each week or who renders any other standard of service generally accepted by custom or specified by contract as part-time employment.
(f) "Employee of a temporary employment agency" means an individual who is hired by a temporary employment agency providing temporary or contract jobs, where the individual performing the work is either an independent contractor or an employee of the temporary employment agency, rather than an employee of the certified applicant or qualified economic development project receiving an economic incentive.
(g) "New employee" means a full-time employee first employed by a certified applicant after the applicant enters into an agreement to receive the economic incentive. A new employee shall not include:
(i) An employee of the certified applicant who performs a job that was previously performed by another employee, if that job existed for at least six (6) months before the hiring of the new employee; however, if the employee performs a job that was previously performed by an employee who was treated under the agreement as a new employee and promoted by the applicant to another job, the employee filling the prior position may be considered a new employee;
(ii) An employee of the certified applicant who was previously employed in Mississippi by an individual or entity related to the applicant and whose employment was shifted to the applicant after the applicant received an economic incentive; or
(iii) A child, grandchild, parent or spouse, other than a spouse who is legally separated from the individual, of any individual who is an employee of the certified applicant and who has a direct or an indirect ownership interest of at least five percent (5%) in the profits, capital or value of the applicant. (An ownership interest shall be determined in accordance with Section 1563 of the Internal Revenue Code and regulations prescribed under that section.)
(h) "Annual report" means the report described in Section 5 of this act.
SECTION 3. Initial requirements. (1) The awarding of an economic incentive to a certified applicant is contingent on a finding by the department that the applicant's qualified economic development project, including, but not limited to, the retention, expansion or location of the applicant's business is clearly in the best interests of this state. This finding shall be contained in a resolution adopted by the department. The resolution shall set forth the evidence and reasons supporting this finding, including, but not limited to:
(a) The estimated value of the annual tax revenue accruing to the state as a direct or indirect result of the qualified economic development project;
(b) Supporting evidence such as a feasibility study, market trends or other data demonstrating that the qualified economic development project will reach the department's stated goal of the economic incentive;
(c) The general impact the qualified economic development project will have on the statewide and local economy and community; and
(d) The number of full-time, part-time or temporary jobs the qualified economic development project is expected to bring in to the statewide economy.
(2) Before an economic incentive is awarded to a certified applicant, the University Research Center shall conduct a fiscal impact study of the qualified economic development project. If the University Research Center lacks the capacity to conduct a fiscal impact study, the department may select another entity to conduct a fiscal impact study in consultation with the University Research Center, which shall have final review over the contents of the fiscal impact study. The fiscal impact study should include:
(a) Information on direct and indirect public and private costs of the qualified economic development project;
(b) Negative effects from the qualified economic development project, and the assumptions on which the information is based; and
(c) An analysis of the impact of the economic incentive on the general fund, and the assumptions on which that analysis is based.
(3) The fiscal impact study referenced in subsection (2) of this section shall be exempt from the Mississippi Public Records Act of 1983 as provided in Section 57-1-14. A copy of the fiscal impact study shall be furnished, upon request, to the Governor, the Speaker of the House and the President of the Senate.
SECTION 4. Performance measures. (1) A certified applicant awarded an economic incentive shall enter into a memorandum of understanding with the state through the department. The memorandum shall contain performance measures, determined by the department, that the applicant's qualified economic development project is expected to meet within the first five (5) years after the incentive is awarded. The performance measures shall align with the department's resolution providing the goals and objectives for the economic incentive and the cost benefit analysis of the applicant's qualified economic development project. The memorandum shall contain provisions allowing the state, through the department or the Attorney General's Office, to stop, readjust or recapture all or part of the economic incentive given to the applicant on noncompliance with the terms of the memorandum.
(2) A certified applicant that fails to meet performance measures as described in this section may not receive or be awarded an economic incentive from the department for a period of five (5) years from the date of failure, or until a recipient satisfies the repayment of the economic incentive, whichever occurs first. For purposes of this subsection (2), if the applicant is an individual, the disqualification attaches to the individual, and if the applicant is a business entity, the disqualification attaches to the entity and to each owner or shareholder of twenty percent (20%) or more of the business.
SECTION 5. Annual report. (1) On or before March 1 of each year, a certified applicant shall file an annual report with the department for any qualified economic development project for the tax year ending during the immediately preceding calendar year, referred to in this paragraph as "the report year," containing the following information:
(a) The number of all full-time employees, part-time employees and employees of a temporary employment agency employed by the certified applicant and based in the state on the last day of the report year;
(b) The incremental amount of qualified investment made in the report year;
(c) The total number of additional full-time employees and part-time employees added in the state by the certified applicant above the applicant's base level of employment since the date the economic incentive was awarded;
(d) The incremental number of additional full-time employees and part-time employees added in the state by the certified applicant above the applicant's base level of employment during the report year;
(e) The average and median wages of all additional full-time employees and part-time employees above the certified applicant's base level of employment in the state whose jobs were added since the first day of the first tax year in which the economic incentive was awarded; and
(f) The percentage and number of all additional full-time employees and part-time employees above the certified applicant's base level of employment who have access to retirement benefits and health benefits.
(2) The department may prescribe forms for the annual report.
(3) By October 1 of each year, the executive director of the department shall file a report with the Governor, the Speaker of the House, the President of the Senate, the Joint Legislative Budget Committee and the members of the committees in the Mississippi House and Senate having jurisdiction over taxation matters, containing data on employment levels, wages and other information described in this section and reported by certified applicants to the department, for each year that the applicant received an economic incentive. In addition to the data on individual qualified economic development projects, the report shall contain the following aggregate information:
(a) The total amount of incentives approved or awarded;
(b) The total amount of loans made by the department;
(c) The total amount of grants awarded by the department;
(d) A description of standard terms for each loan program;
(e) With respect to each certified applicant awarded an economic incentive:
(i) The name and county of operation of the recipient;
(ii) The amount of the loan, rebate or grant;
(iii) The purpose of the loan, rebate or grant;
(iv) The number of employees the certified applicant agreed to hire, retain or train; and
(v) The amount of the financial investment the certified applicant expects to make in this state as a result of the economic development project;
(f) A list of projects that have met contractual requirements and have been closed out by the department.
(4) The Department of Revenue shall provide the department with the tax information required to be included in this report.
SECTION 6. Limitations. Sections 2 through 6 of this act shall apply only to certified applicants for economic incentives awarded by the department after July 1, 2020. Applicants awarded economic incentives prior to July 1, 2020, may file the applicable information voluntarily.
SECTION 7. The Mississippi Development Authority shall file an annual report with the Governor, the Secretary of the Senate and the Clerk of the House not later than July 1, 2001, and each year thereafter, describing all assistance provided under Laws, 2000, Second Extraordinary Session, Chapter 1.
SECTION 8. The Mississippi Development Authority shall prepare and file a quarterly report with the Secretary of State regarding the net economic impact on the state as a result of incentives or other forms of assistance authorized under Section 57-93-1 and Sections 2 through 37 of Chapter 1, Laws of Third Extraordinary Session of 2005, the number of enterprises benefited and the number of jobs created. Each report shall estimate the number of jobs created or retained at each enterprise or business as a result of the incentives or other forms of assistance authorized under Section 57-93-1 and Sections 2 through 37 of Chapter 1, Laws of Third Extraordinary Session of 2005.
SECTION 9. Section 57-1-14, Mississippi Code of 1972, is amended as follows:
57-1-14. (1) Any records
of the * * * Mississippi Development
Authority which contain client information concerning development projects
shall be exempt from the provisions of the Mississippi Public Records Act of
1983 for a period of two (2) years after receipt of the information by the
department. Confidential client information as described in this section
shall not include the information which must be disclosed by the certified
applicant related to a qualified economic development project in the annual
report described in Section 5 of this act.
(2) Confidential client information in public records held by the department shall be exempt from the provisions of the Mississippi Public Records Act of 1983 during the period of review and negotiation on a project proposal and for a period of thirty (30) days after approval, disapproval or abandonment of the proposal not to exceed one (1) year by the department in writing.
SECTION 10. Section 57-1-12, Mississippi Code of 1972, which requires the department to file annual reports describing all assistance provided under the Advantage Mississippi Initiative, is repealed.
SECTION 11. Section 57-1-12.1, Mississippi Code of 1972, which requires the department to file quarterly reports regarding the net economic impact of certain incentives or other forms of assistance, is repealed.
SECTION 12. Section 57-1-12.2, Mississippi Code of 1972, which requires the department to file annual reports regarding tax credits, loans, rebates and grants made, approved or awarded as the result of negotiations involving economic development projects, is repealed.
SECTION 13. Sections 1 through 8 of this act shall be codified in Title 57, Chapter 1, Mississippi Code of 1972.
SECTION 14. This act shall take effect and be in force from and after July 1, 2020.
