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53	53	STATE OF OKLAHOMA
54	54
55	55	2nd Session of the 58th Legislature (2022)
56	56
57	57	SENATE BILL 1715 By: Leewright
58	58
59	59
60	60
61	61
62	62
63	63	AS INTRODUCED
64	64
65	65	An Act relating to income tax credit; crea ting the
66	66	Strategic Industrial Development Enhancement Tax
67	67	Credit Act; defining terms; provi ding credit for
68	68	certain qualified expenditures for certain tax yea rs;
69	69	requiring the Oklahoma Department of Commerce to
70	70	determine qualifying expenditures; authorizing
71	71	sponsor to apply for credit; r equiring the Department
72	72	to provide form; providing requireme nts for the
73	73	application; requiring the Department to review and
74	74	make determination; authorizing the Department to
75	75	allocate credit; requiring the Department to noti fy
76	76	the Oklahoma Tax Commission under certain
77	77	circumstance; limiting allocation of credit for
78	78	qualifying project and certain expenditures; limiting
79	79	allocation of credit in taxable year; requiring
80	80	certain projects be eligible for credit in subsequent
81	81	tax year; allowing unused credits to be carried over
82	82	for certain time; providing for transfer of cre dit to
83	83	certain entities; prohibiting credit to be used to
84	84	reduce tax liability to less than zero; requiring the
85	85	Department to promulgate rules; providing for
86	86	codification; and providing an effecti ve date.
87	87
88	88
89	89
90	90
91	91	BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
92	92	SECTION 1. NEW LAW A new section of law to be codified
93	93	in the Oklahoma Statutes as Section 2357.69 of Title 68, unless
94	94	there is created a duplication in numb ering, reads as follows:
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146	146	A. This act shall be known and may be cited as the “Strategic
147	147	Industrial Development Enhancement Tax Credit Act ”.
148	148	B. As used in this section:
149	149	1. “Department” means the Oklahoma Department of Commerce;
150	150	2. “Eligible entity” means a limited liability company,
151	151	partnership, or corporation located in this state with a qualifying
152	152	project in a qualifying project location;
153	153	3. “Project sponsor” means a local economic development
154	154	organization or authority exempt from taxation pursuant to t he
155	155	provisions of the Internal Revenue Code, 26 U.S.C., Section 501(c),
156	156	port authority, industrial park, or Class II or III railroad
157	157	carriers as defined in 49 CFR , Part 1201.1-1;
158	158	4. “Qualifying economic development expenditure ” means an
159	159	expenditure for land improvements, building construction, building
160	160	improvements and expansion, port termin al improvements, and the
161	161	purchase of machinery and equipment ;
162	162	5. “Qualifying initial infrastructure expenditure” means an
163	163	expenditure for new railroad infrastructure or improvements to
164	164	existing railroad infrastructure, that includes the acquisition of
165	165	right of way, project engineering, construction of new railroad
166	166	including but not limited to tra cks, leads, switches, spurs, and
167	167	sidings, loading dock improvements, and tra nsloading structures
168	168	involved with providing freight rail service;
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220	220	6. “Qualifying project” means the new construction or expansion
221	221	of an eligible entity or a development generating qualified initial
222	222	infrastructure expenditures to serve an eligible entity in a
223	223	qualifying project location; and
224	224	7. “Qualifying project location” means a project located in an
225	225	industrial park, economic development zone, or port located within a
226	226	county in this state with a population of less than one hundred
227	227	thousand (100,000) or a project located adjacent to a terminal or
228	228	switching railroad or Class II or III railroad .
229	229	C. For tax years 2023 through 2027, there shall be allowed a
230	230	credit for an eligible entity against the tax imposed by Section
231	231	2355 of Title 68 of the Oklahoma Statut es, equal to an amount not to
232	232	exceed ten percent (10%) o f an eligible entity ’s qualified economic
233	233	development expenditures or fifty percent (50%) of an eligible
234	234	entity’s qualified initial infrastructure expenditures , subject to
235	235	the determination and allocation by the Department. Credits awarded
236	236	pursuant to this subsection shall be allocated over a three -year
237	237	period in equal amounts.
238	238	D. A project sponsor may apply to the Department for a
239	239	qualifying project of an eligible entity using an application form
240	240	provided by the Department. The application form shall re quire a
241	241	description of the quali fying project, the project location, an
242	242	itemized list of project costs, and a summary of the expected net
243	243	economic benefit and job creation.
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295	295	E. The Department shall review the application and make a
296	296	determination of the amount of qualified economic development
297	297	expenditures and qualified initial infrastructure expenditures that
298	298	qualify for tax credit. Tax credits may be allocated by the
299	299	Department for qualified economic development expenditures and
300	300	qualified initial infrastructure expenditures of a qualifying
301	301	project. The Department shall notify the Oklahoma Tax Commission
302	302	when an eligible entity has been allocated tax credit.
303	303	F. Total credits allocated for a qualifying project shall not
304	304	exceed Six Million Dollars ( $6,000,000.00). Total credit allocated
305	305	for a qualifying project shall not exceed Six Million Dollars
306	306	($6,000,000.00) for qualified economic development expenditures and
307	307	Three Million Dollars ( $3,000,000.00) for qualified initial
308	308	infrastructure expenditures.
309	309	G. Credits allocated by the Departme nt shall not exceed Twelve
310	310	Million Dollars ($12,000,000.00) in a tax year. Qualifying projects
311	311	that have submitted an application and are not allocated all or part
312	312	of credit for qualified economic development expenditures o r
313	313	qualified initial infrastructure expenditures due to the tax year
314	314	limit shall be eligible for credit in subsequent tax years.
315	315	H. Any credits allowed but not used in any taxable year may be
316	316	carried over in order to each of the five (5) subsequent tax years.
317	317	Credits shall be transfer rable to a customer, vendor, project
318	318	investor, or partner of a n eligible entity. Credits shall not be
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370	370	used to reduce the tax liability of the taxpayer to les s than zero
371	371	(0).
372	372	I. The Department shall promulgate rules to implement the
373	373	provisions of this act.
374	374	SECTION 2. This act shall become effective July 1, 2023.
375	375
376	376	58-2-2503 QD 1/20/2022 5:57:26 PM

Oklahoma 2022 Regular Session

Oklahoma Senate Bill SB1715 Compare Versions