OK
Oklahoma House Bill HB3081

Oklahoma 2022 Regular Session

Oklahoma House Bill HB3081 Compare Versions

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1-An Act
2-ENROLLED HOUSE
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3+ENGR. S. A. TO ENGR. H. B. NO. 3081 Page 1 1
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28+ENGROSSED SENATE AMENDMENTS
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30+ENGROSSED HOUSE
331 BILL NO. 3081 By: Hilbert and Phillips of the
432 House
533
634 and
735
8- Hall and Leewright of the
9-Senate
36+ Leewright of the Senate
37+
38+
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40+[ revenue and taxation - creating a strategic
41+industrial development enhancement tax credit -
42+effective date ]
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47+AUTHOR: Remove as principal Senate author Leewright and substitute
48+as principal Senate autho r Hall. Retain Leewright as Senate
49+coauthor
50+
51+AMENDMENT NO. 1. Page 5, line 15, delete all language in subsection
52+J and insert the following language
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55+“Credits allocated by the Department shall not exceed Twelve
56+Million Dollars ($12,000,000.00) in a tax year. Qualifying projects
57+that have submitted an application and are not alloca ted all or part
58+of credit for qualified economic development expenditures or
59+qualified initial infrastructure expenditures due to the tax year
60+limit shall be eligible for credit in subsequent tax years. ”
61+
62+and when the title is restored, amend the title to
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67+ENGR. S. A. TO ENGR. H. B. NO. 3081 Page 2 1
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93+AMENDMENT NO. 2. Page 1, restore the title
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96+Passed the Senate the 27th day of April, 2022.
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100+ Presiding Officer of the Senate
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103+Passed the House of Representatives the ____ day of __________,
104+2022.
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108+ Presiding Officer of the House
109+ of Representatives
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111+ENGR. H. B. NO. 3081 Page 1 1
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136+ENGROSSED HOUSE
137+BILL NO. 3081 By: Hilbert and Phillips of the
138+House
139+
140+ and
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142+ Leewright of the Senate
10143
11144
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13146
14147
15-
16-An Act relating to revenue and taxation ; defining
17-terms; creating a strategic industrial development
18-enhancement tax credit; limi ting credits to certain
19-amount for certain projects; preventing certain
20-application of credit; allowing assignment of credit;
21-requiring certain documents for assignment;
22-authorizing carryover of credit; setting total annual
23-credit cap; authorizing Oklahoma Tax Commission and
24-Oklahoma Department of Commerce to promulgate cert ain
25-rules; imposing certain limitation on credit amount;
26-providing for codification; and providing an
27-effective date.
148+[ revenue and taxation - creating a strategic
149+industrial development enhancement tax credit -
150+effective date ]
28151
29152
30153
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32-SUBJECT: Revenue and taxation
33-
34155 BE IT ENACTED BY THE PEOPLE OF T HE STATE OF OKLAHOMA:
35-
36156 SECTION 1. NEW LAW A new sectio n of law to be codified
37157 in the Oklahoma Statutes as Section 2357.105 of Title 68, unless
38158 there is created a duplication in numbering, reads as follows:
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40159 A. As used in this section :
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42160 1. "Eligible entity" means a business entity incorporated and
43161 located in the state with a qualifying project in a qualifying
44162 project location that receives an a llocation of tax credits for
45163 qualified economic development and qualified initial infrastruct ure
46-expenditures; ENR. H. B. NO. 3081 Page 2
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164+expenditures;
48165 2. "Qualifying project" means the new construction or expa nsion
49166 of an eligible entity or the development of qualified init ial
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50193 infrastructure to serve an eligible entity in a qualifying project
51194 location;
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53195 3. "Qualifying project location" means a project located in an
54196 industrial park, economic development zone, or port located within a
55197 county in this state with a population of less than one hundred
56198 thousand (100,000) persons ("Qualified Area"), or a project located
57199 adjacent to a terminal, s witching, or Class II or III railroad as
58200 defined by the federal Surface T ransportation Board;
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60201 4. "Project sponsor" means a local economic dev elopment
61202 organization or authority, organized under Section 501(c)(3) of the
62203 Internal Revenue Code, 26 U.S.C., Sec tion 501(c)(3), port authority,
63204 qualified industrial park, or a terminal, swi tching, or Class II or
64205 III railroad;
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66206 5. "Project application" means an application submitted by a
67207 project sponsor on behalf of a qualifying project for an allocation
68208 of qualifying strategic industrial development enhancement ( SIDE)
69209 tax credits. Project applications must include a description of the
70210 qualifying project, project location, detailed project costs, and a
71211 summary of expected economic benefits and job creation;
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73212 6. "Qualified economic development expenditures " means
74213 expenditures for land improvem ents, building construction, building
75214 improvements and expansio n, port terminal improvements, and the
76215 purchase of certain machinery and equipment;
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78242 7. "Qualified initial infrastructure expenditures" means
79243 expenditures for new rail infrastructure and improv ements, which
80244 includes the acquisition of right -of-way, engineering, construction
81245 of new track such as industrial leads, switches, spurs, and sidings,
82246 loading dock improvements, a nd transloading structures involved with
83247 providing rail service to a qualifyi ng project; and
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85248 8. "Project tax credit amount" means the amount of tax credits
86249 allocated by Oklahoma Department of Commerce to a qualifying project
87250 for qualified economic develop ment and initial infrastructure
88251 expenditures.
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90252 B. For tax years beginning aft er December 31, 2022, and ending
91-not later than December 31, 2027, there shall be allowed a credit ENR. H. B. NO. 3081 Page 3
253+not later than December 31, 2027, there shall be allowed a credit
92254 against the tax imposed pursuant to Section 2355 of Title 68 of the
93255 Oklahoma Statutes in an amount not to exceed ten percent (10%) of an
94256 eligible entity's qualified economic development expenditures,
95257 subject to limitations, determination, and allocation by the
96258 Oklahoma Department of Commerce.
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98259 C. The total project tax credit amount may not exceed ten
99260 percent (10%) of the qualified economic development expendit ures,
100261 except for qualified initial infrastructure expenditur es the project
101262 tax credit amount is earned at the rate of fifty percent (50%) of
102263 qualified initial infrastructure expen ditures.
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104290 D. 1. The project tax credit amount for qualified economic
105291 development expenditures may not exceed Six Million Dollars
106292 ($6,000,000.00) per qualifying project.
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108293 2. The project tax credit amount for qualified initial
109294 infrastructure expenditures ma y not exceed Three Million Dollars
110295 ($3,000,000.00) per qualifying project.
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112296 Projects are eligible to combine qualified economic developmen t
113297 and qualified initial infrastructure expenditures, but the total
114298 project tax credit amount may not exceed Six Million Dollars
115299 ($6,000,000.00) per qualifying project in aggregate.
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117300 E. The project tax credit amount that may be claimed or
118301 assigned to a qualifying project affiliate in any year may not
119302 exceed one-third (1/3) of the project tax credit amount awarded
120303 beginning in the year that construction is initiated.
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122304 F. The issuance of the project tax credit amount shall be
123305 subject to review of eligible ex penditures and qualifying project
124306 status by the Oklahoma Department of Commerce.
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126307 G. The credits authorized pursuant to t his section may not be
127308 used to reduce the tax liability of the taxpayer to le ss than zero
128309 (0).
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130310 H. The credits allowed pursuant to thi s section that are not
131311 used may be assigned to a qualifying project affiliate by written
132312 agreement at any time during the five (5) years following the tax
133313 year the qualified expenditures are incurred . For purposes of this
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134340 subsection, a "qualifying project affiliate" shall include a
135341 customer, vendor, project investor, or strategic finance partner of
136-the eligible entity subject to the Oklahoma corporate or individual ENR. H. B. NO. 3081 Page 4
342+the eligible entity subjec t to the Oklahoma corporate or individual
137343 income tax. The eligible taxpayer and the qualifying project
138344 affiliate must jointly file a copy o f the written assignment
139345 agreement with the Oklahoma Tax Commission within thirty (30) days
140346 of the assignment. The written agreement must contain the name,
141347 address, and taxpayer identification number of the parties to the
142348 assignment, the tax year the eli gible taxpayer incurred the
143349 qualified expenditures, the amount of credit being assigned, and the
144350 tax year or years fo r which the credit may be claimed.
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146351 I. To the extent not used, the tax credit authorized by this
147352 section may be carried over, in order, to each of the five (5)
148353 subsequent taxable years .
354+J. The total credits authorized pursuant to this section for
355+all taxpayers shall not exceed Twelve Million Dollars
356+($12,000,000.00) annually beginning in tax year 2023. In the event
357+the total tax credits aut horized by this section exceed Twelve
358+Million Dollars ($12,000,000.00) annually in any calendar year, the
359+Tax Commission shall permit any excess over Twelve Million Dollars
360+($12,000,000.00) annually but shall factor such excess into the
361+percentage adjustment formula for subsequent years. The Tax
362+Commission shall annually calculate and publish by the first day of
363+the affected year a percentage by which the credits authorized by
149364
150-J. Credits allocated by the Department sha ll not exceed Twelve
151-Million Dollars ($12,000,000.00) in a tax year. Qualifying projects
152-that have submitted an application and are not allocated all or part
153-of credit for qualified economic development expenditures or
154-qualified initial infrastructure exp enditures due to the tax year
155-limit shall be eligib le for credit in subsequent tax years.
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390+this section shall be reduced so the total amount of credits used to
391+offset tax does not exceed Twelve Million Dollars ($12,000,000.00)
392+annually per year. The formula to be used for the percentage
393+adjustment shall be Twelve Million Dollars ($12,000,000.00) annually
394+divided by the credits claimed in the second preceding year .
157395 K. 1. The Oklahoma Tax Commission may promulgate rules, forms ,
158396 and regulations as are necessary to implement and administer the
159397 provisions of this section and certify the tax credit amount
160398 generated by each qualifying project annually.
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162399 2. The Oklahoma Departmen t of Commerce shall promulgate rules
163400 to permit verification of the eligibility of a qualifying project
164401 for the purpose of claiming the credit. The rules shall provide for
165402 the approval of qualif ied economic development expenditures prior to
166403 commencement of a project and provide a certificate of verification
167404 upon completion of a project that uses qualified economic
168405 development expenditures. The certificate of verification shall
169406 satisfy all requirements of the Oklahoma Tax Commission pertaining
170407 to the eligibility of the eligible taxpayer claiming the credit.
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172408 SECTION 2. This act shall become effective Janua ry 1, 2023.
173409
174- ENR. H. B. NO. 3081 Page 5
175-Passed the House of Repr esentatives the 20th day of May, 2022.
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436+Passed the House of Representatives the 14th day of March, 2022.
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180441 Presiding Officer of the House
181442 of Representatives
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184-Passed the Senate the 27th day of April, 2022.
445+Passed the Senate the ___ day of __________, 2022.
185446
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189450 Presiding Officer of the Senate
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191452
192453
193-OFFICE OF THE GOVERNOR
194-Received by the Office of the Governor this __ __________________
195-day of ___________________, 20_______, at _______ o'clock _______ M.
196-By: _________________________________
197-Approved by the Governor of the State of Oklahoma this _____ ____
198-day of ___________________, 20_______, at _______ o'clock _______ M.
199-
200-
201- _________________________________
202- Governor of the State of Oklahoma
203-
204-OFFICE OF THE SECRETARY OF STATE
205-Received by the Office of the Secretary of State this __________
206-day of ___________________, 20_______, at _______ o'clock _______ M.
207-By: _________________________________