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)]
HB 30 Original 2020 Second Extraordinary Session Wright
Abstract: Establishes an incentive rebate of up to 10% of new payroll for qualified businesses and
either a state sales and use tax rebate for capital expenditures for facilities or a project facility
expense rebate for businesses that re-shore jobs, services, production, research, or
manufacturing to La. from overseas.
Proposed law authorizes an incentive program for qualified businesses that re-shore jobs, services,
production, research, or manufacturing to La. from overseas with the aim of creating employment
opportunities, boosting local economies, or balancing trade deficits. The incentives include a rebate
of up to 10% of new payroll for qualified businesses and either a state sales and use tax rebate for
capital expenditures for facilities or a project facility expense rebate.
Proposed law provides that the state sales and use tax rebate shall be on purchases of materials used
in the construction of a building, or any addition or improvement to the building, for housing a
legitimate business enterprise or machinery and equipment used in that enterprise.
Proposed law provides that the project facility expense rebate shall be equal to 1.2% of the amount
of qualified capital expenditures for the facility designated in the contract. Proposed law defines
"qualified capital expenditures" as amounts classified as capital expenditures for federal income tax
purposes related to the project plus exclusions from capitalization provided for in federal tax law,
minus certain capitalized costs and the cost for the purchase of an existing building. A qualified
business earns the project facility expense rebate in the fiscal year in which the project is placed in
service but may not be issued the rebate until the Dept. of Economic Development (DED) signs a
project completion report.
Proposed law defines a qualified business as one which meets either of the following eligibility
requirements:
(1)A new business that is locating in this state that will be re-shoring its supply chain for the
manufacture or production of its products by using business in this state.
(2)An existing La. business whose current production of goods is outside of this state or the
U.S. and the business provides documentation that it is relocating the supply chain for the
production of its products into La.
Proposed law authorizes businesses selected by regional economic development organizations to also
participate in the incentive program. No later than Dec. 20, 2020, each regional economic development organization may select up to two industry sectors from its region to participate in the
program. Each regional economic development organization is required to base its selection of an
industry sector on whether the sector will diversify the region's economy.
Proposed law requires a qualified business to offer, or offer within 90 days of the date of qualifying
for the incentive rebates in proposed law, a basic health benefits plan to individuals it employs that
includes coverage for basic hospital care, physician care, and health care and is determined by DED
to have a value of at least $1.25 per hour and which is the same coverage as is provided to employees
employed in a bona fide executive, administrative, or professional capacity by the employers who
are exempt from the minimum wage and maximum hour requirements of federal law.
Proposed law establishes an application process for participation in the incentive program as well
as a process for businesses to apply for an incentive contract with DED. Authorizes the secretary of
DED to certify that a business meets the eligibility requirements provided for in proposed law and
that securing the project will result in a significant positive economic benefit to the state.
Proposed law requires the contract for the payment of a payroll rebate to include the following:
(1)The percentage of new payroll eligible for rebate, up to a maximum of 10%.
(2)The maximum amount of new payroll eligible for rebate.
(3)The number of new jobs and amount of new payroll required to be created and maintained
and any other performance obligations required to be met in order to remain qualified for
participation in the program.
(4)Designation of the facility or facilities eligible for participation in the program.
(5)Monitoring of performance and consequences for failure to perform and other contract
violations.
(6)An initial contract term of up to five years, and any renewal term available at the discretion
of the secretary, which may be up to an additional five years.
Proposed law requires a business to annually certify its eligibility and to file requests for approval
of rebates with DED. After verification of continued eligibility and performance, DED shall send
a rebate certification letter to the Dept. of Revenue, stating the amount of actual new payroll for the
subject year, the amount of rebate to be issued, and the entity to which the rebate shall be issued.
Rebates shall be paid from the current collections of the taxes imposed pursuant to present law.
Proposed law prohibits a taxpayer who received the incentive provided for in proposed law from
receiving any other incentive administered by DED for any expenditures or jobs for which the
taxpayer has received a rebate pursuant to proposed law.
Proposed law authorizes the department to promulgate rules in accordance with present law subject to oversight by the Ways and Means and Revenue and Fiscal Affairs committees to implement the
provisions of proposed law.
Proposed law prohibits any new contract from being approved on or after Dec. 31, 2023, but
contracts existing on that date may continue and may be renewed.
Effective upon signature of governor or lapse of time for gubernatorial action.
(Adds R.S. 51:3126)