HLS 13RS-976 REENGROSSED
Page 1 of 12
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
Regular Session, 2013
HOUSE BILL NO. 483
BY REPRESENTATIVE NANCY LANDRY
TAX CREDITS: Extends authority to grant tax credits for certain state-certified musical or
theatrical facility infrastructure projects
AN ACT1
To amend and reenact R.S. 47:6034(A), (B)(4), (8), (9), (10), and (11), (C)(1)(a)(ii)(aa) and2
(bb), (C)(3), (E)(1)(e) and (F), to enact R.S. 47:6034(B)(12) and (H), and to repeal3
R.S. 47:6034(C)(1)(b), (e), and (f), relative to income tax credits for state-certified4
musical and theatrical productions and state-certified infrastructure projects; to5
extend the time period for granting certain tax credits; to provide with respect to a6
tax credit for state-certified higher education musical or theatrical infrastructure7
projects; to provide relative to certain definitions; to provide for certain requirements8
and limitations; to provide with respect to the application for such tax credits and9
certification of productions and infrastructure projects; to provide for the10
disallowance of credits; to provide for the recovery of credits; and to provide for11
related matters.12
Be it enacted by the Legislature of Louisiana:13
Section 1. R.S. 47:6034(A), (B)(4), (8), (9), (10), and (11), (C)(1)(a)(ii)(aa) and (bb),14
(C)(3), (E)(1)(e) and (F) are hereby amended and reenacted and R.S. 47:6034(B)(12) and (H)15
are hereby enacted to read as follows:16
ยง6034. Musical and theatrical production income tax credit17
A. Purpose. It is the intention of the legislature in creating these five18
different types of tax credits: a credit for qualified production expenditures made19
from investments in a state-certified musical or theatrical production; a credit for the20
construction, repair, or renovation of facilities related to such productions and21 HLS 13RS-976 REENGROSSED
HB NO. 483
Page 2 of 12
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
performances; a credit for qualified transportation costs for performance-related1
property; a credit for the payroll of Louisiana residents employed in connection with2
a state-certified musical or theatrical production; and a credit for employing college,3
university, and vocational-technical students employed in connection with a state-4
certified musical or theatrical production, to establish and promote Louisiana as one5
of the primary places in the United States in which live performances, from creation6
to presentation, are present and thriving. The live performance industry will enhance7
economic development because it fits well with the state's reputation as a tourist8
destination, will offer numerous and varied employment opportunities, and in9
conjunction with the available federal and state incentives, will be an attraction for10
new and relocating businesses and will provide for the reinventing of countless11
abandoned properties as either performance or rehearsal spaces. The live12
performance industry will also spur educational development: Louisiana colleges,13
universities, and vocational-technical schools will be able to offer talented14
undergraduate and graduate students from this state, other states, and around the15
world a real-world opportunity to participate in degree programs across the state that16
work on the various productions in accounting, law, management, and marketing and17
to fill arts-related positions such as actors, writers, producers, stagehands, and18
directors, as well as technicians working on all aspects of the production such as19
lighting, sound, and actual stage production and operations.20
B. Definitions. For the purposes of this Section:21
* * *22
(4) "Limited state-certified musical or theatrical production" means a23
musical or theatrical production or a series of productions occurring in Louisiana by24
a nonprofit community theater that held a public performance before an audience25
within this state during the 2008 calendar year which has been certified, verified, and26
approved in accordance with the provisions of this Section. "Infrastructure27
expenditures" means expenditures directly related to the state-certified infrastructure28
project or state-certified higher education infrastructure projects including land and29 HLS 13RS-976 REENGROSSED
HB NO. 483
Page 3 of 12
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
land acquisition costs, construction costs, design fees, furniture, fixtures, and1
equipment purchased subject to a sale agreement or capital lease. Infrastructure2
expenditures shall not include indirect costs such as general administrative costs,3
insurance, or any costs related to the transfer or allocation of tax credits. The4
Department of Economic Development may determine whether expenditures5
submitted as production-related costs of capital costs related to an infrastructure6
facility represent legitimate expenditures for the actual costs of related goods or7
services that have economic substance and a business purpose related to the certified8
production or facility, or such costs constitute constructive dividends, self-dealing,9
inflated prices or similar transactions entered into for the purpose of inflating the10
amount of tax credits earned rather than for the benefit of the production or facility.11
* * *12
(8) "Related party transaction" means a transaction between parties deemed13
to be related by common ownership or control under generally accepted auditing14
principles. Related party transaction expenditures may be subject to limitations as15
provided for by rules and regulations promulgated by the department.16
(9)(a) "Resident" or "resident of Louisiana" means a natural person and, for17
the purpose of determining eligibility for the tax incentives provided by this Section,18
a person who qualifies for any of the following reasons:19
(i) The person is domiciled in the state of Louisiana.20
(ii) The person maintains a permanent place of abode within the state and21
spends in the aggregate more than six months of each year within the state.22
(iii) The person pays taxes to the state on the amount of money paid to such23
person for which a credit is sought pursuant to this Section.24
(b) A company owned or controlled by such a person and which lends the25
services of such a person for a state-certified musical or theatrical production shall26
also be deemed a resident if such company is organized or authorized to do business27
in the state and such company pays taxes to the state on the amount of money paid28
to such company for such services of such person.29 HLS 13RS-976 REENGROSSED
HB NO. 483
Page 4 of 12
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
(9)(10) "State-certified higher education musical or theatrical infrastructure1
project" means a new proscenium or black-box theatre infrastructure project situated2
on a parcel of land located on the campus of a higher education institution in this3
state, that is owned by a higher education campus institution or support foundation4
related to the campus primarily operated to benefit and support campus students and5
the higher education facility. The primary purpose of the proposed infrastructure6
facility must be to host live performances, and the facility must have a minimum7
fixed seating capacity of five hundred. Expenditures attributable to areas other than8
where live performances will take place may comprise no more than twenty-five9
percent of total qualifying expenditures. 10
(11)(a) "State-certified musical or theatrical facility infrastructure project"11
or "state-certified infrastructure project", for any project which receives initial12
certification before July 1, 2013, means a capital infrastructure project in the state13
directly related to the production or performance of musical or theatrical productions14
as defined in this Section, and movable and immovable property and equipment15
related thereto, or any other facility that supports and is a necessary component of16
such facility, and any expenditures in the state related to the construction, repair, or17
renovation of such project, which that are certified, verified, and approved as18
provided for in this Section.19
(b) "State-certified musical or theatrical infrastructure project" or "state20
certified infrastructure project", for any project which receives initial certification21
on or after July 1, 2013, means a new or rehabilitated proscenium or black-box22
theatre infrastructure project located in the state and any expenditures in the state23
directly related to the construction, repair, or renovation of such project, which are24
certified, verified, and approved as provided for in this Section. The primary25
purpose of the proposed facility must be to host live performances and the facility26
must have a minimum capacity of five hundred. Expenditures attributable to areas27
other than where live performances will take place may comprise no more than28
twenty-five percent of total qualifying expenditures.29 HLS 13RS-976 REENGROSSED
HB NO. 483
Page 5 of 12
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
(10)(a)(12)(a) "State-certified musical or theatrical production" means a1
musical or theatrical production performed in this state including but not limited to2
concerts, musical tours, ballet, dance, comedy revue, or live variety entertainment,3
or a series of productions occurring over the course of a twelve-month period, and4
the recording or filming of such production, that originate, are developed, or have5
their initial public performance before an audience within Louisiana, or that have6
their United States debut within Louisiana, and the production expenditures,7
expenditures for the payroll of residents, transportation expenditures, and8
expenditures for employing college and vocational-technical students related to such9
production or productions, that are certified, verified, and approved as provided for10
in this Section. Non-qualifying projects include but are not limited to non-touring11
music and cultural festivals, industry seminars, and trade shows, and any production12
activity taking place outside the state.13
(b) A "state-certified musical or theatrical production" that shall be eligible14
for recertification and the credit provided for in this Section shall include a15
previously certified musical or theatrical production that received a credit pursuant16
to this Section and is otherwise eligible pursuant to this Section, that returns for17
performances within the state after being performed on Broadway.18
(11)(a) "Transportation expenditures" means expenditures for the packaging,19
crating, and transportation both to the state for use in a state-certified musical or20
theatrical production of sets, costumes, or other tangible property constructed or21
manufactured out of state, and/or from the state after use in a state-certified musical22
or theatrical production of sets, costumes, or other tangible property constructed or23
manufactured in this state. Such term shall include the packaging, crating, and24
transporting of property and equipment used for special and visual effects, sound,25
lighting, and staging, costumes, wardrobes, make-up and related accessories and26
materials, as well as any other performance or production-related property and27
equipment; provided that transportation services are purchased through a company28
which has a significant business presence in the state.29 HLS 13RS-976 REENGROSSED
HB NO. 483
Page 6 of 12
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
(b) "Transportation expenditures" shall not include any costs to transport1
property and equipment to be used only for filming and not in a state-certified2
production, any indirect costs, any expenditures that are later reimbursed by a third3
party, or any amounts that are paid to persons or entities as a result of their4
participation in profits from the exploitation of the production.5
C. Income tax credits for state-certified productions and state-certified6
musical or theatrical facility infrastructure projects:7
(1) There is hereby authorized the following types of credits against the state8
income tax:9
(a)10
* * *11
(ii)(aa) Until For state-certified infrastructure projects that receive initial12
certification on or before January 1, 2014, a base investment credit may be granted13
earned for certified, verified, and approved expenditures made in the state on or14
before January 1, 2014, for the construction, repair, or renovation of a state-certified15
musical or theatrical facility infrastructure project or for investments made by a16
company or a financier in such infrastructure project which are, in turn, expended for17
such construction, repair, or renovation, not to exceed ten million dollars per state-18
certified infrastructure project, under conditions provided for in this Item. No more19
than sixty million dollars in tax credits under this Section shall be granted for20
infrastructure projects per year.21
(bb) If all or a portion of an infrastructure project is a facility which may be22
used for other purposes not directly related to the production or performance of23
musical or theatrical production activities, then the project shall be approved only if24
a determination is made that the multiple-use facility will support and will be25
necessary to secure musical or theatrical production activities for the musical or26
theatrical production or performance facility and the applicant provides sufficient27
contractual assurances that: For state-certified higher education musical or theatrical28
infrastructure projects that receive initial certification on or before January 1, 2018,29 HLS 13RS-976 REENGROSSED
HB NO. 483
Page 7 of 12
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
a base investment credit may be earned for expenditures made in the state on or1
before January 1, 2022, for the construction, repair, or renovation of a new state-2
certified higher education musical or theatrical facility infrastructure project, or for3
investments made by a company or a financier in such infrastructure project that are,4
in turn, expended for such construction, repair, or renovation. No more than ten5
million dollars in tax credits per project or sixty million dollars total in tax credits6
shall be granted for state-certified higher education musical or theatrical7
infrastructure projects. Twenty-five percent of the total base investment provided8
for in the initial certification letter of a state-certified higher education musical or9
theatrical infrastructure project must be expended on or before January 1, 2020, in10
order for the project to earn credits for the remaining estimated base investment11
provided for in the initial certification letter, as expenditures are made in the state on12
or before January 1, 2022. No credits shall be certified until the state-certified higher13
education musical or theatrical infrastructure project is complete. The initial14
certification letter shall be effective for qualified expenditures made no more than15
six months prior to the date of application. State-certified higher education musical16
or theatrical infrastructure projects shall not be subject to the provisions of Subitem17
(cc) of this Item nor shall such projects be subject to the provisions of Subsection H18
of this Section.19
(I) The facility will be used for the production or performance of musical or20
theatrical production activities, or as a support and component thereof, for the useful21
life of the facility. 22
(II) No tax credits shall be earned on such multiple-use facilities until the23
facility directly used in musical or theatrical productions or performances is24
complete. 25
* * *26
(3) Tax credits associated with a state-certified musical or theatrical27
production or a state-certified musical or theatrical facility infrastructure project shall28 HLS 13RS-976 REENGROSSED
HB NO. 483
Page 8 of 12
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
never exceed the total base investment in that production or infrastructure project1
and transportation expenditures.2
* * *3
E. Certification and administration:4
(1)5
* * *6
(e) Prior to the final certification of a production or infrastructure project, the7
applicant shall submit to the Department of Economic Development a report an audit8
of the final amount of expenditures qualifying for credits pursuant to this Section,9
which report the Department of Economic Development may require to be prepared10
by an independent certified public accountant. The Department of Economic11
Development shall review the report audit and shall issue a final tax credit12
certification letter, certifying the applicant and indicating the type and amount of tax13
credits for which the applicant or other companies or financiers are eligible pursuant14
to this Section.15
* * *16
F.(1) Recapture of credits. If the Department of Economic Development, or17
the Department of Revenue find that funds for which a taxpayer received credits18
according to this Section were not expended for expenditures qualifying for a credit19
as provided in this Section, then the taxpayer's state income tax for such taxable20
period shall be increased by such amount necessary for the recapture of credit21
provided by this Section.22
(2)(a) Recovery of credits by Department of Revenue. Credits granted to a23
taxpayer, but later disallowed, may be recovered by the secretary of the Department24
of Revenue through any collection remedy authorized by R.S. 47:1561 and initiated25
within three years from December thirty-first of the year in which the credit was26
taken.27
(b) The only interest that may be assessed and collected on recovered credits28
is interest at a rate three percentage points above the rate provided in R.S.29 HLS 13RS-976 REENGROSSED
HB NO. 483
Page 9 of 12
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
9:3500(B)(1), which shall be computed from the original date of the return on which1
the credit was taken.2
(3) The provisions of this Subsection are in addition to and shall not limit the3
authority of the secretary of the Department of Revenue to assess or to collect under4
any other provision of law. Disallowance of credits by the Department of Economic5
Development. Tax credits shall be subject to disallowance in whole or in part, if the6
Department of Economic Development finds that a taxpayer has obtained a tax credit7
in violation of the provisions of this Section, including but not limited to fraud or8
misrepresentation, as further provided by rule.9
* * *10
H. Recovery of credits by the Department of Revenue:11
(1) Credits previously granted to a taxpayer but later disallowed by the12
Department of Economic Development may be recovered by the secretary of the13
Department of Revenue through any collection remedy authorized by R.S. 47:156114
and initiated within three years from December thirty-first of the year in which the15
credit was taken.16
(2) The only interest that may be assessed and collected on recovered credits17
is interest at a rate three percentage points above the rate provided for in R.S.18
9:3500(B)(1), which shall be computed from the original date of the return on which19
the credit was taken.20
(3) The provisions of this Subsection are in addition to and shall not limit the21
authority of the secretary of the Department of Revenue to assess or to collect under22
any other provision of law.23
* * *24
Section 2. R.S. 47:6034(C)(1)(b), (e), and (f) are hereby repealed in their entirety.25
Section 3. This Act shall become effective July 1, 2013.26 HLS 13RS-976 REENGROSSED
HB NO. 483
Page 10 of 12
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
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)]
Nancy Landry HB No. 483
Abstract: Extends the time period for granting income tax credits related to the
construction, repair, or renovation of facilities related to musical and theatrical
productions and performances and limits credits for projects after Jan. 1, 2014, to
those located on the campus of a higher education institution.
Present law establishes five different types of tax credits related to musical and theatrical
productions.
Proposed law repeals two credits: the credit for qualified transportation costs for
performance-related property, and the credit for projects for nonprofit community theaters.
One of the five credits authorized in present law is a credit for the construction, repair, or
renovation of a state-certified musical or theatrical facility infrastructure project. Present
law further provides that the amount of the base investment credit given for investment in
such projects cannot exceed $10,000,000 per project. Further provides that no more than
$60,000,000 in tax credits under present law may be granted for these projects per year.
Proposed law retains present law with respect to the limitations on the amount of credits per
project as well as the annual overall program limit.
Present law sunsets the authority to grant credits on Dec. 31, 2013.
Proposed law changes the termination date for the authority to grant tax credits from Dec.
31, 2013, to Dec. 31, 2022.
Present law defines "infrastructure project" as a capital infrastructure project in La. directly
related to the production or performance of musical or theatrical productions, property and
equipment related thereto, any other facility which supports and is a necessary component
of such facility, and any expenditures in the state related to the construction, repair, or
renovation of such project.
Proposed law retains present law definition of "infrastructure project" for those projects
which receive initial certification before July 1, 2013.
Proposed law revises the definition of "infrastructure project" for those projects which
receive initial certification on or after July 1, 2013. Proposed law defines "infrastructure
project" as a new or rehabilitated proscenium or black-box theatre infrastructure project
located in La. and any expenditures in the state directly related to the construction, repair,
or renovation of such project. Further, the primary purpose of the proposed facility must be
to host live performances and the facility must have a minimum capacity of 500.
Expenditures attributable to areas other than where live performances will take place may
comprise no more than 25% of total qualifying expenditures.
Proposed law also defines "higher education infrastructure project" in the same manner as
proposed law for projects receiving initial certification on or after July 1, 2013, except limits
projects to those located on the campus of an institution of higher education.
Proposed law defines "infrastructure expenses" as those directly related to a state-certified
infrastructure project or state-certified higher education infrastructure project including land HLS 13RS-976 REENGROSSED
HB NO. 483
Page 11 of 12
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
and land acquisition costs, construction costs, design fees, furniture, fixtures, and equipment
purchased subject to a sale agreement or capital lease.
Proposed law excludes from the definition of "infrastructure expenditures" indirect costs
such as general administrative costs, insurance, or any costs related to the transfer or
allocation of tax credits.
Present law defines "state-certified musical or theatrical production" as a musical or
theatrical production or a series of productions occurring over the course of a twelve-month
period, and the recording or filming of such production, which originate, are developed, or
have their initial public performance before an audience within La., or which have their
United States debut within La., and expenditures related thereto. Proposed law retains
present law and adds to the definition by including concerts, musical tours, ballet, dance,
comedy revue, or live variety entertainment.
Proposed law provides that after Jan. 1, 2014, the availability for tax credits shall be limited
to those infrastructure projects situated on a parcel of land located on the campus of a higher
education institution, which is owned by a higher education campus institution or support
foundation related to the campus primarily operated to benefit and support campus students
and faculty.
Proposed law provides that for higher education musical or theatrical infrastructure projects
which receive initial certification on or before Jan. 1, 2018, a base investment credit may be
earned for expenditures made in La. on or before Jan. 1, 2022, for the construction, repair,
or renovation of a new state-certified higher education musical or theatrical facility
infrastructure project, or for investments made by a company or a financier in such
infrastructure project which are, in turn, expended for such construction, repair, or
renovation. One quarter of the total base investment must be expended on or before Jan. 1,
2020, in order for a project to earn credits for any remaining estimated base investment
provided for in its initial certification letter, as expenditures are made on or before Jan. 1,
2022.
Proposed law requires that an infrastructure project be complete before any credits are
certified.
Present law requires that 50% of the total amount of tax credits granted annually shall be
reserved for projects located outside of Jefferson and Orleans parishes. Proposed law
excludes higher education musical or theatrical infrastructure projects from this requirement.
Present law provides for disallowance and recapture of credits.
Proposed law rewords provisions of present law regarding disallowance and recapture, but
retains the substance of present law.
Effective July 1, 2013.
(Amends R.S. 47:6034(A), (B)(4), (8), (9), (10), and (11), (C)(1)(a)(ii)(aa) and (bb), (C)(3),
(E)(1)(e), and (F); Adds R.S. 47:6034(B)(12) and (H); Repeals R.S. 47:6034(C)(1)(b), (e),
and (f))
Summary of Amendments Adopted by House
Committee Amendments Proposed by House Committee on Ways and Means to the
original bill.
1. Changes program eligibility after Jan. 1, 2014, from a project located anywhere
in the state to a project on the campus of a higher education institution. HLS 13RS-976 REENGROSSED
HB NO. 483
Page 12 of 12
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
2. Adds requirements for the timing of expenditures for qualification for tax credits.
4. Revises present law regarding disallowance, recapture and recovery of tax
credits.
5. Deletes provisions of present law requiring the Dept. of Economic Development
to report to the legislature with regard to the tax credit program.
6. Deletes the tax credit authorized under present law for certain investments in
nonprofit community theaters.
7. Deletes present law regarding the allowance of transportation costs as certified
expenditures.
8. Adds and revises definitions.
House Floor Amendments to the engrossed bill.
1. Deletes provisions governing recapture of disallowed tax credits by the Dept. of
Revenue.
2. Adds specific definitions of "state-certified musical or theatrical infrastructure
project" for projects receiving initial certification both before and after the
effective date of proposed law.
3. Adds July 1, 2013 effective date.