Alabama 2023 Regular Session

Alabama House Bill HB293 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1		-	~~HB293ENROLLED~~
	1	+	HB293INTRODUCED
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3		-	MSFCHW-3
	3	+	MSFCHW-1
4	4		By Representatives Brown, Stringer, Lipscomb, Marques, Givens,
5	5		Holk-Jones, Clarke, Kirkland, Travis, Starnes, Jones, Hassell,
6	6		Shirey, Hulsey, Collins, Pringle, Drummond, Bracy, Wilcox,
7	7		Lomax
8	8		RFD: Ways and Means Education
9	9		First Read: 11-Apr-23
10		-	2023 Regular Session
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18		-	8 ~~HB293 EnrolledHB293 Enrolled~~
	17	+	8 MSFCHW-1 01/16/2023 RA (F) RA 2023-99
19	18		Page 1
20		-	Enrolled, An Act,
21		-	Relating to port credits; to amend Sections 40-18-401
22		-	and 40-18-403, Code of Alabama 1975, to expand the cap of the
23		-	port credit and to expand tax incentives for businesses and
24		-	enterprises who increase their cargo volume through Alabama
25		-	public ports.
	19	+	SYNOPSIS:
	20	+	Under existing law, an income tax credit is
	21	+	allowed for certain port activities.
	22	+	This bill would revise the structure of the
	23	+	amounts of the credits that may be claimed and
	24	+	expand the credit to allow port users to claim a jobs
	25	+	tax credit if the user increases their cargo base
	26	+	volume.
	27	+	A BILL
	28	+	TO BE ENTITLED
	29	+	AN ACT
	30	+	Relating to port credits; to amend Section 40-18-403,
	31	+	Code of Alabama 1975, to expand tax incentives for businesses
	32	+	and enterprises who increase their cargo volume through
	33	+	Alabama public ports.
26	34		BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
27		-	Section 1. Sections 40-18-401 and 40-18-403, Code of
28		-	Alabama 1975, are amended to read as follows:
29		-	"§40-18-401
30		-	(a) The port credit provided for in Section 40-18-403
31		-	is created by this article and is allowed upon strict
32		-	compliance with the provisions herein.
33		-	(b) Prior to the allowance of the port credit, an
34		-	application shall be filed with the commission, on a form
35		-	promulgated by the commission.
36		-	(1) The application shall be filed by the port facility
37		-	user desiring to claim the credit.
38		-	(2) The commission shall establish deadlines for
39		-	applications. Such applications shall solicit whatever
40		-	information the commission deems important to its
41		-	determination of whether granting a port credit will create
42		-	new, high paying jobs in the state, bring substantial capital
43		-	to the state, increase the usage of a port facility, promote
44		-	the development of clusters of businesses in the state, or
45		-	promote the economic development efforts of the state.
	35	+	Section 1. Section 40-18-403, Code of Alabama 1975, is
	36	+	amended to read as follows:
	37	+	"§40-18-403
	38	+	(a) If approved by the commission, a port credit is
	39	+	allowed, in an amount equal to fifty dollars ($50) per TEU,
	40	+	three dollars ($3) per net ton, four cents ($0.04) per
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	68	+	28 HB293 INTRODUCEDHB293 INTRODUCED
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75		-	(3) Upon review of the applications, the commission may
76		-	approve such applications as shall result in port credits
77		-	being awarded so as not to exceed twelve million dollars
78		-	($12,000,000) twenty million dollars ($20,000,000) for the
79		-	life of the program, and shall not exceed five million dollars
80		-	($5,000,000) in a fiscal year.
81		-	(4) The commission shall charge application fees to
82		-	offset the costs of administration of this article.
83		-	(c) Prior to claiming a port credit, the company shall
84		-	submit to the Department of Commerce a certification
85		-	containing information adequate to prove that the company is
86		-	entitled to the credit. Following such examination as it deems
87		-	necessary, the Department of Commerce may certify the
88		-	information and deliver the same to the Department of Revenue.
89		-	Thereafter, the Department of Revenue shall allow the tax
90		-	credit.
91		-	(d)(1) Nothing in this article shall be construed to
92		-	constitute a guarantee or assumption by the state of any debt
93		-	of any company nor to authorize the credit of the state to be
94		-	given, pledged, or loaned to any company.
95		-	(2) Nothing in this article shall be construed to make
96		-	available to any company any right to the benefits conferred
97		-	by this article absent strict compliance with this article.
98		-	(3) Nothing in this article shall be construed to
99		-	change or lessen the requirements for claiming jobs act
100		-	incentives under the Alabama Jobs Act, Section 40-18-370, et
101		-	seq. Companies claiming the jobs act incentives must strictly
102		-	comply with the Alabama Jobs Act.
	70	+	kilogram for air freight, or two dollars and ninety-one cents
	71	+	($2.91) per VEU, multiplied by the following the cargo volume
	72	+	calculated from subdivisions (1) and (2) as follows multiplied
	73	+	by the appropriate amount shown in the table in subsection
	74	+	(b):
	75	+	(1) The port user's cargo volume in the 12-month period
	76	+	for which the commission has granted approval for the port
	77	+	user to claim the port credit, minus
	78	+	(2) The port user's base cargo volume.
	79	+	(b) Port credit amount.
	80	+	Increase in
	81	+	cargo volume
	82	+	over base
	83	+	TEU Net Ton
	84	+	Kilogram
	85	+	for Air
	86	+	Freight
	87	+	VEU
	88	+	under 4.99
	89	+	percent
	90	+	$50 $3 $0.04 $2.91
	91	+	5 to 14.99
	92	+	percent
	93	+	$75 $4.5 $0.06 $4.37
	94	+	15 to 24.99
	95	+	percent
	96	+	$100 $6 $0.08 $5.82
	97	+	25 percent
	98	+	or greater
	99	+	$125 $7.5 $0.1 $7.28
	100	+	(b) (c) The commission shall decrease the amount of the
	101	+	port credit to ensure that the anticipated revenues for the
	102	+	port facility and state will exceed the amount of the port
	103	+	credit sought. The port credit may be conditioned on whatever
	104	+	requirements the commission shall impose. The port credits
	105	+	shall only be available to the extent that a port facility
	106	+	user ships more than 105 percent of its cargo volume from the
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132		-	(4) All filings made by a private party with the
133		-	commission or any department of state government shall be made
134		-	using forms adopted by the commission or department. Any such
135		-	filing shall be treated as a tax return, subject to penalties
136		-	imposed by the Department of Revenue.
137		-	(5) Nothing in this article shall be construed to limit
138		-	the powers otherwise existing for the Department of Revenue to
139		-	audit and assess any company claiming a port credit."
140		-	"§40-18-403
141		-	(a) If approved by the commission, a port credit is
142		-	allowed, in an amount equal to fifty dollars ($50) per TEU,
143		-	three dollars ($3) per net ton, four cents ($0.04) per
144		-	kilogram for air freight, or two dollars and ninety-one cents
145		-	($2.91) per VEU, multiplied by the following the cargo volume
146		-	calculated from subdivisions (1) and (2) as follows multiplied
147		-	by the appropriate amount shown in the table in subsection
148		-	(b):
149		-	(1) The port user's cargo volume in the 12-month period
150		-	for which the commission has granted approval for the port
151		-	user to claim the port credit, minus
152		-	(2) The port user's base cargo volume.
153		-	(b) Port credit amount.
154		-	Increase in
155		-	cargo volume
156		-	over base
157		-	cargo volume
158		-	TEU Net Ton
159		-	Kilogram
160		-	for Air
161		-	Freight
162		-	VEU
163		-	under 4.99
164		-	percent
165		-	$50 $3 $0.04 $2.91
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	139	+	Page 3
	140	+	12-month period immediately preceding the port facility user's
	141	+	application. Moreover, the port credit shall only be available
	142	+	to the extent a port facility user ships more than 10 TEUs,
	143	+	for cargo measured by TEU, more than 75 net tons, for cargo
	144	+	measured by net ton, more than fifteen thousand (15,000)
	145	+	kilograms for air cargo measured by kilograms, or more than
	146	+	400 VEUs, for cargo measured by VEU.
	147	+	(c)(d)The following methods may be used to realize the
	148	+	port credit:
	149	+	(1) The port credit may offset the tax levied by this
	150	+	chapter, but not below zero. The port credit may also offset
	151	+	the estimated payments of the tax levied by this chapter, but
	152	+	not below zero. In no event shall the port credits be allowed
	153	+	to reduce any estimated payment of the tax levied by this
	154	+	chapter before October 1, 2016. In any one year, if the port
	155	+	credit exceeds the amount of tax liability, the port user may
	156	+	carry forward the unused port credit. No carryforward shall be
	157	+	allowed for more than five years. Rules similar to those used
	158	+	for Section 40-18-15.2 shall be applied.
	159	+	(2) A company may assign and convey a port credit to
	160	+	another company if substantially all of the assets of the
	161	+	company are assigned and conveyed in the same transaction.
	162	+	Proof of such transfer shall be submitted to the Department of
	163	+	Revenue.
	164	+	(e) Subject to approval by the commission provided in
	165	+	Section 40-18-401, any business or enterprise which has
	166	+	increased its cargo volume during the previous 12-month period
	167	+	by a percentage above its base cargo volume traffic and is
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199		-	5 to 14.99
200		-	percent
201		-	$75 $4.5 $0.06 $4.37
202		-	15 to 24.99
203		-	percent
204		-	$100 $6 $0.08 $5.82
205		-	25 percent
206		-	or greater
207		-	$125 $7.5 $0.1 $7.28
208		-	(c)The commission shall decrease the amount of the port
209		-	credit to ensure that the anticipated revenues for the port
210		-	facility and state will exceed the amount of the port credit
211		-	sought. The port credit may be conditioned on whatever
212		-	requirements the commission shall impose. The port credits
213		-	shall only be available to the extent that a port facility
214		-	user ships more than 105 percent of its cargo volume from the
215		-	12-month period immediately preceding the port facility user's
216		-	application. Moreover, the port credit shall only be available
217		-	to the extent a port facility user ships more than 10 TEUs,
218		-	for cargo measured by TEU, more than 75 net tons, for cargo
219		-	measured by net ton, more than fifteen thousand (15,000)
220		-	kilograms for air cargo measured by kilograms, or more than
221		-	400 VEUs, for cargo measured by VEU.
222		-	(c)(d)The following methods may be used to realize the
223		-	port credit:
224		-	(1) The port credit may offset the tax levied by this
225		-	chapter, but not below zero. The port credit may also offset
226		-	the estimated payments of the tax levied by this chapter, but
227		-	not below zero. In no event shall the port credits be allowed
228		-	to reduce any estimated payment of the tax levied by this
229		-	chapter before October 1, 2016. In any one year, if the port
	197	+	qualified to claim a job credit under Article 16, Chapter 18,
	198	+	Title 40, shall be allowed an additional jobs credit provided
	199	+	in Section 40-18-375(a), on the wages paid to its Alabama
	200	+	Resident employees during the prior year. The amount of the
	201	+	credit can be seen in the table below:
	202	+	Percentage Increase Amount of Job Credit
	203	+	5-14.99% 0.5%
	204	+	15-24.99% 1%
	205	+	25-34.99% 1.5%
	206	+	35% or higher 2%
	207	+	(d)(f) To the extent that the port credit is utilized
	208	+	by the port user or by a transferee company, no deduction for
	209	+	the related expenses shall be allowed.
	210	+	(e)(g) For any company which enters into an economic
	211	+	development project agreement with the state, the project
	212	+	agreement may provide for an allocation to the company of any
	213	+	port credits which have not been allocated pursuant to this
	214	+	article. Allocations made pursuant to this subsection shall
	215	+	meet all of the following requirements:
	216	+	(1) Allocations shall be made by the Governor and
	217	+	approved by the commission.
	218	+	(2) Allocations for a project shall not exceed three
	219	+	million dollars ($3,000,000).
	220	+	(3) Allocations shall be granted only to a new
	221	+	warehouse or distribution facility which commits to investing
	222	+	at least twenty million dollars ($20,000,000) at a single site
	223	+	and to creating 75 net new jobs in Alabama.
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	253	+	(4) Port credits may not be used until the Department
	254	+	of Commerce has received satisfactory proof that the capital
	255	+	investment and job creation requirements have been satisfied.
	256	+	(5) Any port credit granted by this procedure shall not
	257	+	be granted for more than a 3-year period.
	258	+	(6) Allocations shall not exceed one hundred dollars
	259	+	($100) per TEU, three dollars ($3) per net ton, four cents
	260	+	($0.04) per kilogram for air freight, or two dollars and
	261	+	ninety-one cents ($2.91) per VEU.
	262	+	(7) Anticipated revenues for the state shall exceed the
	263	+	port credit granted, and the project agreement shall provide
	264	+	for recapture of all or part of the port credit should the
	265	+	company default on its obligations in the project agreement."
	266	+	Section 2. The provisions of this act shall be
	267	+	effective for all tax years beginning after December 31, 2023.
	268	+	Section 3. This act shall become effective January 1,
	269	+	2024, following its passage and approval by the Governor, or
	270	+	its otherwise becoming law.
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262		-	credit exceeds the amount of tax liability, the port user may
263		-	carry forward the unused port credit. No carryforward shall be
264		-	allowed for more than five years. Rules similar to those used
265		-	for Section 40-18-15.2 shall be applied.
266		-	(2) A company may assign and convey a port credit to
267		-	another company if substantially all of the assets of the
268		-	company are assigned and conveyed in the same transaction.
269		-	Proof of such transfer shall be submitted to the Department of
270		-	Revenue.
271		-	(e)To the extent that the port credit is utilized by
272		-	the port user or by a transferee company, no deduction for the
273		-	related expenses shall be allowed.
274		-	(f)For any company which enters into an economic
275		-	development project agreement with the state, the project
276		-	agreement may provide for an allocation to the company of any
277		-	port credits which have not been allocated pursuant to this
278		-	article. Allocations made pursuant to this subsection shall
279		-	meet all of the following requirements:
280		-	(1) Allocations shall be made by the Governor and
281		-	approved by the commission.
282		-	(2) Allocations for a project shall not exceed three
283		-	million dollars ($3,000,000).
284		-	(3) Allocations shall be granted only to a new
285		-	warehouse or distribution facility which commits to investing
286		-	at least twenty million dollars ($20,000,000) at a single site
287		-	and to creating 75 net new jobs in Alabama.
288		-	(4) Port credits may not be used until the Department
289		-	of Commerce has received satisfactory proof that the capital
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319		-	investment and job creation requirements have been satisfied.
320		-	(5) Any port credit granted by this procedure shall not
321		-	be granted for more than a 3-year period.
322		-	(6) Allocations shall not exceed the per unit amounts
323		-	stated in subsection (b) one hundred dollars ($100) per TEU,
324		-	three dollars ($3) per net ton, four cents ($0.04) per
325		-	kilogram for air freight, or two dollars and ninety-one cents
326		-	($2.91) per VEU. .
327		-	(7) Anticipated revenues for the state shall exceed the
328		-	port credit granted, and the project agreement shall provide
329		-	for recapture of all or part of the port credit should the
330		-	company default on its obligations in the project agreement."
331		-	Section 2. The provisions of this act shall be
332		-	effective for all tax years beginning after December 31, 2023.
333		-	Section 3. This act shall become effective January 1,
334		-	2024, following its passage and approval by the Governor, or
335		-	its otherwise becoming law.
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354		-	________________________________________________
355		-	Speaker of the House of Representatives
356		-	________________________________________________
357		-	President and Presiding Officer of the Senate
358		-	House of Representatives
359		-	I hereby certify that the within Act originated in and
360		-	was passed by the House 17-May-23, as amended.
361		-	John Treadwell
362		-	Clerk
363		-	Senate 01-Jun-23 Passed
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