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Regular Session, 2012
HOUSE BILL NO. 754
BY REPRESENTATIVES ROBIDEAUX, ABRAMSON, ADAMS, ARMES, BADON,
BARRAS, BERTHELOT, BILLIOT, STUART BISHOP, WESLEY BISHOP,
BROADWATER, BROWN, BURFORD, HENRY BURNS, TI M BURNS,
CARMODY, CARTER, CHAMPAGNE, CHANEY, CONNICK, CROMER,
FANNIN, FOIL, GAROFALO, GISCLAIR, GREENE, GUILLORY, GUINN,
HARRIS, HAZEL, HENSGENS, HOFFMANN, HOLLIS, HOWARD, HUVAL,
JEFFERSON, JOHNSON, KLECKLEY, LAMBERT, LEBAS, LEGER, LEOPOLD,
LIGI, LORUSSO, MILLER, MONTOUCET, ORTEGO, PIERRE, PONTI, POPE,
PYLANT, REYNOL DS, RICHARDSON, RITCHIE, SCHEXNAYDER,
SEABAUGH, SHADOIN, SIMON, ST. GERMAIN, THIBAUT, THOMPSON,
WHITNEY, PATRICK WILLIAMS, AND WILLMOTT
TAX/TAX REBATES: Authorizes the secretary of DED to enter into state sales and use tax
rebate contracts with procurement processing companies which recruit purchasing
companies to La.
AN ACT1
To enact Subpart R of Part II-A of Chapter 1 of Subtitle I of Title 39 of the Louisiana2
Revised Statutes of 1950, to be comprised of R.S. 39:100.126, and Chapter 3 of3
Subtitle VII of Title 47 of the Louisiana Revised Statutes of 1950, to be comprised4
of R.S. 47:6301, relative to rebates; to authorize contracts for certain state sales and5
use tax rebates; to provide for definitions, requirements, and limitations; to provide6
for the amount, approval, and issuance of rebates; to provide for the recapture of7
rebates under certain circumstances; to provide relative to the payment of certain8
taxes in error; to provide with respect to administrative expenses; to provide for the9
disposition of certain state revenues; to establish the Specialized Educational10
Institutions Support Fund; to provide for the deposit, use, and investment of monies11
in the fund; to authorize the promulgation of rules and regulations; to provide for an12
effective date; and to provide for related matters.13 HLS 12RS-990 REENGROSSED
HB NO. 754
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Be it enacted by the Legislature of Louisiana:1
Section 1. Subpart R of Chapter 1 of Part II-A of Subtitle I of Title 39 of the2
Louisiana Revised Statutes of 1950, comprised of R.S. 39:100.126, is hereby enacted to read3
as follows: 4
SUBPART R. SPECIALIZED EDUCATIONAL INSTITUTIONS5
SUPPORT FUND6
§100.126. Specialized Educational Institutions Support Fund7
A. There is hereby established in the state treasury a special fund to be8
known as the "Specialized Educational Institutions Support Fund", hereinafter9
referred to as "fund". The source of monies for the fund shall be those state revenues10
deposited into the fund pursuant to the requirements of R.S. 47:6301. Monies in the11
fund shall be invested in the same manner as those in the state general fund. Monies12
remaining in the fund at the end of the fiscal year shall remain to the credit of the13
fund.14
B. Monies in the fund shall be available for appropriation exclusively for the15
support of operations of the Pennington Biomedical Research Center, the Louisiana16
State University Agricultural Center, and the Southern University Agricultural17
Research and Extension Center. Monies appropriated from the fund shall not be18
used in any fiscal year to displace, replace, or supplant state general fund support for19
these agencies.20
C. Appropriations from the fund in any fiscal year shall be allocated as21
provided in this Subsection; however, in the event that the amount available for22
appropriation in any fiscal year is insufficient to provide for such allocations, the23
amounts allocated shall be reduced proportionately.24
(1) Ten Million Dollars for the Louisiana State University Agricultural25
Center.26
(2) Five Million Dollars for the Pennington Biomedical Research Center.27
(3) One Million Dollars for the Southern University Agricultural Research28
and Extension Center.29 HLS 12RS-990 REENGROSSED
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Section 2. Chapter 3 of Subtitle VII of Title 47 of the Louisiana Revised Statutes of1
1950, comprised of R.S. 47:6301, is hereby enacted to read as follows: 2
§6301. Rebates; contracts for certain state sales and use tax rebates3
A. Definitions. For purposes of this Section, the following words shall have4
the following meanings unless the context clearly indicates otherwise:5
(1) "Affiliated entity" shall mean a person who, directly or indirectly through6
one or more intermediaries, controls or is controlled by or is under common control7
with another person.8
(2) "Department" shall mean the Department of Revenue.9
(3) "New taxable sales" shall mean the sale of goods and services upon10
which state sales and use tax is paid under Title 47 of the Louisiana Revised Statutes11
of 1950 and which would not have occurred in the state but for the operation in the12
state of a procurement processing company.13
(4) "Procurement processing company" means a company engaged in14
managing the activities of unrelated purchasing companies.15
(5) "Purchasing company" means a company engaged in the activity of16
selling property and services to affiliated entities.17
(6) "Secretary" shall mean the secretary of the Department of Revenue.18
(7) "Significant positive economic benefit" means that net positive state tax19
revenues are to be generated from the new taxable sales.20
B. Contract. The secretary of the Department of Economic Development is21
authorized to enter into a contract with a procurement processing company to recruit22
to Louisiana, purchasing companies that generate sales of items subject to the taxes23
imposed under this Title the business of which shall have a significant positive24
economic benefit to the state. The initial term of a contract shall not exceed twenty25
years and shall be renewable for up to an additional twenty years. The contract shall26
provide an incentive to the procurement processing company which shall be paid in27
the form of a rebate of a portion of the state sales and use taxes collected on new28 HLS 12RS-990 REENGROSSED
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taxable sales by a purchasing company which is managed by a procurement1
processing company.2
C. Certification of sales. The secretary of the department shall determine the3
amount of incentive rebates to be paid to a procurement processing company4
pursuant to the contract. Rebate payments shall be based upon the amount of new5
taxable sales which are certified by the secretary.6
D. Payment of rebate. 7
(1) Notwithstanding any provision of law to the contrary, the secretary of the8
department shall make the rebate authorized pursuant to the provisions of this9
Section from the state sales tax revenue generated by the new taxable sales occurring10
in this state as a result of the operation of a procurement processing company in11
Louisiana.12
(2) If after a rebate has been paid, the department determines that certain13
items included in the rebate payment did not constitute new taxable sales, the amount14
rebated for those items shall be recaptured by the department from the procurement15
processing company, subject to the prescriptive period set forth in R.S. 47:1561.2.16
(3) Notwithstanding any provision of law to the contrary, if a procurement17
processing company receives a rebate for new taxable sales under the provisions of18
this Section, in no event shall the taxes on such new taxable sales remitted to19
Louisiana by the purchasing company or affiliated entity constitute an overpayment20
as defined in R.S. 47:1621.21
E. The Department of Revenue may promulgate rules and regulations in22
accordance with the provisions of the Administrative Procedure Act as are necessary23
to implement the provisions of this Section.24
F. Administrative expenses. After satisfaction of the requirements of Article25
VII, Section 9 of the Constitution of Louisiana, of the monies collected from new26
taxable sales as a result of the activities of purchasing companies pursuant to the27
provisions of this Section, the secretary of the department is authorized to retain an28
amount necessary to provide for the expenses the department shall incur in the29 HLS 12RS-990 REENGROSSED
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administration of the provisions of this Section. Such monies are hereby designated1
to be self-generated revenues of the department.2
G. Disposition of collections resulting from new taxable sales.3
(1) From the monies deposited each fiscal year into the state general fund4
generated from new taxable sales as a result of the activities of purchasing5
companies pursuant to this Section, the state treasurer is hereby authorized and6
directed to transfer the amount of sixteen million dollars, or as much thereof as is7
available, from the state general fund to the Specialized Educational Institutions8
Support Fund, which is established pursuant to the provisions of R.S. 39:100.126.9
No more than sixteen million dollars shall be deposited into the fund in any fiscal10
year from this source. Deposits shall be made quarterly until the annual maximum11
amount has been deposited.12
(2) The availability of monies necessary to comply with the provisions of13
this Subsection shall be evidenced by the amount of new taxable sales upon which14
a rebate has been paid pursuant to this Section. The secretary is authorized and15
directed to estimate the amount of taxes which have been deposited into the state16
general fund as a result of such new taxable sales. Upon request, the secretary shall17
provide written notification to the state treasurer as to the amount of money available18
for the making of deposits as required by this Subsection.19
Section 3. This Act shall become effective on July 1, 2012; if vetoed by the governor20
and subsequently approved by the legislature, this Act shall become effective on July 1,21
2012, or on the day following such approval by the legislature, whichever is later.22
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
Robideaux HB No. 754
Abstract: Authorizes the secretary of DED to enter into state sales and use tax rebate
contracts with procurement processing companies which recruit purchasing
companies to La., and provides for the dedication of a portion of revenues generated
therefrom for administrative expenses and support of LSU and Southern Ag. Centers
and Pennington Biomedical Research Center. HLS 12RS-990 REENGROSSED
HB NO. 754
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Proposed law authorizes the secretary of the Dept. of Economic Development (DED) to
enter into a contract with a procurement processing company to recruit to La., purchasing
companies that generate sales of items subject to the taxes imposed under present law, the
business of which shall have a significant positive economic benefit to the state. The
contract shall provide an incentive to the procurement processing company which shall be
paid in the form of a rebate of a portion of the state sales and use taxes collected on new
taxable sales by a purchasing company which is managed by a procurement processing
company. The initial term of a contract shall not exceed 20 years with authority to grant
renewals for up to an additional 20 years.
Proposed law authorizes the secretary of DED to determine the amount of incentive rebates
to be paid to a procurement processing company pursuant to the contract. Further requires
rebate payments to be based on the amount of new taxable sales which are certified by the
secretary of DED.
Proposed law defines a "procurement processing company" as a company engaged in
managing the activities of unrelated purchasing companies. Further defines "new taxable
sales" as sales of goods and services upon which tax is paid under present law and which
would not have occurred in the state but for the operation of a procurement processing
company in La.
Proposed law defines an "affiliated entity" as a person who, directly or indirectly through
one or more intermediaries, controls or is controlled by or is under common control with
another person.
Proposed law provides that "significant positive economic benefit" means that net positive
state tax revenues are to be generated from new taxable sales.
Proposed law requires Dept. of Revenue (DOR) to pay the rebate from the state sales tax
revenue generated by the new taxable sales occurring in La. as a result of the operation of
a procurement processing company in La.
Proposed law provides that if after a rebate has been paid, DOR determines that certain items
included in the rebate payment did not constitute new taxable sales, the amount rebated for
those items shall be recaptured by the department from the procurement processing
company, subject to the prescriptive period provided for in present law.
Proposed law provides that if a procurement processing company receives a rebate for new
taxable sales, in no event shall the taxes on such new taxable sales remitted to La. constitute
an overpayment.
Proposed law authorizes DOR to promulgate rules and regulations in accordance with the
APA as are necessary to implement the provisions of proposed law.
Proposed law provides that from monies collected as a result of new taxable sales the
secretary of DOR may retain amounts necessary for administration of the provisions of
proposed law.
Proposed law dedicates $16 million per fiscal year from the monies deposited into the state
general fund generated from new taxable sales generated pursuant to proposed law. The
state treasurer is required to transfer such monies from the state general fund to a newly
created special treasury fund, the Specialized Educational Institutions Support Fund (fund).
Proposed law establishes the fund and provides for the deposit and investment of monies in
the fund. Monies available for appropriation in any fiscal year from the fund shall be
allocated as follows: $10 Million for the LSU Agricultural Research and Extension Center, HLS 12RS-990 REENGROSSED
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$5 Million for the Pennington Biomedical Research Center, and $1 Million for the Southern
University Agricultural Research and Extension Center.
Proposed law provides that in the event the amount available for appropriation in any fiscal
year is insufficient to provide for such allocations, the amounts allocated shall be reduced
proportionately.
Effective July 1, 2012.
(Adds R.S. 39:100.126 and R.S. 47:6301)
Summary of Amendments Adopted by House
Committee Amendments Proposed by House Committee on Ways and Means to the
original bill.
1. Added definitions for an "affiliated entity" and "significant positive economic
benefit".
2. Deleted requirement that the governor determine the contract to be in the best
interest of the state.
3. Authorized renewal of the contract for up to an additional 20 years.
4. Changed payment of the rebate from the current collection of taxes imposed by
present law to state sales tax revenue generated by the new taxable sales
occurring as the result of the operation of a procurement processing company in
La.
5. Added provisions relative to the recapture of certain rebate payments, subject to
the prescriptive period provided for in present law.
6. Prohibited taxes paid on new taxable sales by the purchasing company or
affiliated entity from constituting an overpayment.
House Floor Amendments to the engrossed bill.
1. Clarified the definition of "significant positive economic benefit" and deletes
provisions detailing how "significant economic benefit" is determined.
2. Authorized the retention of amounts necessary for administration of the program
by the Dept. of Revenue.
3. Dedicated $16 million per fiscal year of the state revenues generated by new
taxable sales for purposes of the Specialized Educational Institutions Support
Fund.
4. Established the Specialized Educational Institutions Support Fund and requires
the allocation of appropriations from the fund for the LSU Agricultural Research
and Extension Center, the Pennington Biomedical Research Center, and the
Southern University Agricultural Research and Extension Center.