Oklahoma 2022 Regular Session

Oklahoma Senate Bill SB498 Compare Versions

Version 1 (Old)

Version 2 (New)

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3		-	SB498 HFLR Page 1
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	3	+	ENGR. S. B. NO. 498 Page 1 1
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29		-	HOUSE OF REPRESENTATIVES - FLOOR VERSION
30		-
31		-	STATE OF OKLAHOMA
32		-
33		-	1st Session of the 58th Legislature (2021)
34		-
35	28		ENGROSSED SENATE
36	29		BILL NO. 498 By: Thompson and McCortney of
37	30		the Senate
38	31
39	32		and
40	33
41	34		Fetgatter of the House
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	38	+	An Act relating to ad valorem tax; amending 68 O.S.
	39	+	2011, Section 2902, as last amen ded by Section 1,
	40	+	Chapter 258, O.S.L. 2019 (68 O.S. Sup p. 2020, Section
	41	+	2902), which relates to ad valorem tax exemption;
	42	+	providing waiver of certain payrol l requirement
	43	+	relating to current and future exemptions for certain
	44	+	facilities; and declaring an emergency.
45	45
46		-
47		-	[ ad valorem tax exemption - providing waiver of
48		-	certain payroll requirement –
49		-	emergency ]
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54	50		BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
55	51		SECTION 1. AMENDATORY 68 O.S. 2011, Section 2902, as
56	52		last amended by Section 1, Chapter 258, O.S.L. 2019 (68 O.S. Supp.
57	53		2020, Section 2902), is amended to read as follows:
58	54		Section 2902. A. Except as otherwise provided by subsection H
59	55		of Section 3658 of this title pursuant to which the exemption
60	56		authorized by this section may not be claimed, a qualifying
61	57		manufacturing concern, as defined by Section 6B of Ar ticle X of the
62	58		Oklahoma Constitution, and as further de fined herein, shall be
63	59		exempt from the levy of any ad valorem taxes upon new, expanded or
	60	+	acquired manufacturing facilities , including facilities engaged in
	61	+	research and development, for a period of fi ve (5) years. The
	62	+	provisions of Section 6B of Article X of the Oklahoma Constitution
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65		-	SB498 HFLR Page 2
66		-	BOLD FACE denotes Committee Amendments. 1
	64	+	ENGR. S. B. NO. 498 Page 2 1
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91		-	acquired manufacturing facilities , including facilities engaged in
92		-	research and development, for a period of five (5) years. The
93		-	provisions of Section 6B of Article X of the Oklahoma Constitution
94	89		requiring an existing facility to have been unoccupied for a period
95	90		of twelve (12) months prior to acquisition shall be construe d as a
96	91		qualification for a facility to ini tially receive an exemption , and
97	92		shall not be deemed to be a qualification for that facility to
98	93		continue to receive an exemption in each of the four (4) years
99	94		following the initial year for which the exemption was granted.
100	95		Such facilities are hereby class ified for the purposes of t axation
101	96		as provided in Secti on 22 of Article X of the Oklahoma Constitution.
102	97		B. For purposes of this section, the following definitions
103	98		shall apply:
104	99		1. “Manufacturing facilities ” means facilities engaged in the
105	100		mechanical or chemical transformation of ma terials or substances
106	101		into new products and except as provided by paragraph 8 of
107	102		subsection C of this section shall include:
108	103		a. establishments which have received a manufacturer
109	104		exemption permit pursuant to the provisions of Sect ion
110	105		1359.2 of this title,
111	106		b. facilities, including repair and replacement parts,
112	107		primarily engaged in aircraft repair, building and
113	108		rebuilding whether or not on a factory basis,
	109	+	c. establishments primarily engaged in computer services
	110	+	and data processing a s defined under Industrial Group
	111	+	Numbers 5112 and 5415, and U.S. Industry Number 334611
	112	+	and 519130 of the NAICS Manual, latest revision, and
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115		-	SB498 HFLR Page 3
116		-	BOLD FACE denotes Committee Amendments. 1
	114	+	ENGR. S. B. NO. 498 Page 3 1
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141		-	c. establishments primarily engaged in comp uter services
142		-	and data processing as defined under Industrial Group
143		-	Numbers 5112 and 5415, and U.S. Industry Number 334611
144		-	and 519130 of the NAICS Manual, latest revision, and
145	139		which derive at least fifty percent (50%) of their
146	140		annual gross revenues from the sale of a product or
147	141		service to an out-of-state buyer or consumer, and as
148	142		defined under Industrial Group Number 5142 of the
149	143		NAICS Manual, latest revision, which derive at least
150	144		eighty percent (80%) of their annual gross revenues
151	145		from the sale of a product or service to an out -of-
152	146		state buyer or consumer. Eligibilit y as a
153	147		manufacturing facilit y pursuant to this subparagraph
154	148		shall be established, subject to review by the
155	149		Oklahoma Tax Commission, by annually filing an
156	150		affidavit with the Tax Commission stating that the
157	151		facility so qualifies an d such other information as
158	152		required by the Tax Commiss ion. For purposes of
159	153		determining whether annual gross revenues are derived
160	154		from sales to out-of-state buyers, all sales to the
161	155		federal government shall be con sidered to be an out-
162	156		of-state buyer,
163	157		d. for which the investment cost of the construction,
164	158		acquisition or expansion of the manufacturing facility
	159	+	is Two Hundred Fifty Thousand Dollars ($250,000.00) or
	160	+	more. Provided, “investment cost” shall not include
	161	+	the cost of direct replacement, refurbishmen t, repair
	162	+	or maintenance of existing machinery or equip ment,
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166		-	SB498 HFLR Page 4
167		-	BOLD FACE denotes Committee Amendments. 1
	164	+	ENGR. S. B. NO. 498 Page 4 1
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192		-	is Two Hundred Fifty Thousand Dollars ($250,000.00) or
193		-	more. Provided, “investment cost” shall not include
194		-	the cost of direct replacement, refurbishment, repair
195		-	or maintenance of existing machinery or equipment,
196	189		except that “investment cost” shall include capital
197	190		expenditures for direct replacement, refurbishment,
198	191		repair or maintenance of existing machinery or
199	192		equipment that qualifies for depreciation an d/or
200	193		amortization pursuant to the Internal Revenue Code of
201	194		1986, as amended, and such expenditures shall be
202	195		eligible as a part of an “expansion” that otherwise
203	196		qualifies under this section, and
204	197		e. establishments primarily engaged in distribution as
205	198		defined under Industry Numbers 493 11, 49312, 49313 and
206	199		49319 and Industry Sector Number 42 of the NAICS
207	200		Manual, latest revision, and which meet the following
208	201		qualifications:
209	202		(1) construction with an initial capital invest ment
210	203		of at least Five Million Dollars ($5, 000,000.00),
211	204		(2) employment of at least one hundred (10 0) full-
212	205		time-equivalent employees, as certified by the
213	206		Oklahoma Employment Security Commission,
214	207		(3) payment of wages or salaries to its employees at
215	208		a wage which equals or exceeds one hundred
	209	+	seventy-five percent (175%) of the f ederally
	210	+	mandated minimum wage, as certified by the
	211	+	Oklahoma Employment Security Commission, and
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217		-	SB498 HFLR Page 5
218		-	BOLD FACE denotes Committee Amendments. 1
	213	+	ENGR. S. B. NO. 498 Page 5 1
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243		-	seventy-five percent (175%) of the federally
244		-	mandated minimum wage, as certified by the
245		-	Oklahoma Employment Security Commission, and
246	238		(4) commencement of construction on or after November
247	239		1, 2007, with construction to be com pleted within
248	240		three (3) years from the dat e of the commencement
249	241		of construction.
250	242		Eligibility as a manufacturing facility pursuant to this
251	243		subparagraph shall be established, subject to review by the Tax
252	244		Commission, by annually filing an affidavit with the T ax Commission
253	245		stating that the facility so qualifies and containing s uch other
254	246		information as required by the Tax Commission.
255	247		Provided, eating and drinking places, as well as other retail
256	248		establishments, shall not qualify as manufacturing facilities for
257	249		purposes of this section, nor shall centrall y assessed properties.
258	250		Eligibility as a manufacturing f acility pursuant to this
259	251		subparagraph shall be established, subject to review by the Tax
260	252		Commission, by annually filing an application with the Tax
261	253		Commission stating that the facility so qualifies and containing
262	254		such other information as required by the T ax Commission;
263	255		2. “Facility” and “facilities” means and includes the land,
264	256		buildings, structures, improvements, machinery, fixtures, equipment
265	257		and other personal property used directly and exclusively in the
266	258		manufacturing process; and
	259	+	3. “Research and development” means activities directly related
	260	+	to and conducted for the purpose of discovering, enhancing,
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268		-	SB498 HFLR Page 6
269		-	BOLD FACE denotes Committee Amendments. 1
	262	+	ENGR. S. B. NO. 498 Page 6 1
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294		-	3. “Research and development ” means activities directly related
295		-	to and conducted for the purpose of discovering, enhancing,
296	287		increasing or improving future or existing products or processes or
297	288		productivity.
298	289		C. The following provisions shall apply:
299	290		1. A manufacturing concern shall be entitled to the exemption
300	291		herein provided for each new manufacturing facility constructed,
301	292		each existing manufacturing facility acquired and the expa nsion of
302	293		existing manufacturing facilities on the same site, as such terms
303	294		are defined by Section 6B of Article X of the Oklahoma Constitution
304	295		and by this section;
305	296		2. Except as otherwise provided in paragraph 5 of this
306	297		subsection, no manufacturing concern shall receive more than one
307	298		five-year exemption for any one manufact uring facility unless the
308	299		expansion which qualifies the manufacturing facility for an
309	300		additional five-year exemption meets the requirements of paragraph 4
310	301		of this subsection and the emplo yment level established for any
311	302		previous exemption is maintained;
312	303		3. Any exemption as to the exp ansion of an existing
313	304		manufacturing facility shall be limited to the increase in ad
314	305		valorem taxes directly attributable to the expansion;
315	306		4. Except as provide d in paragraphs 5 and, 6 and 10 of this
316	307		subsection, all initial appli cations for any exemption fo r a new,
	308	+	acquired or expanded manufacturing facility shall be granted only
	309	+	if:
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318		-	SB498 HFLR Page 7
319		-	BOLD FACE denotes Committee Amendments. 1
	311	+	ENGR. S. B. NO. 498 Page 7 1
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344		-	acquired or expanded manufacturing facility shall be granted only
345		-	if:
346	336		a. there is a net increase in annualized base payroll
347	337		over the initial payroll o f at least Two Hundred Fifty
348	338		Thousand Dollars ($250,000.00) if the fa cility is
349	339		located in a county with a population of fewer than
350	340		seventy-five thousand (75,000), according to the most
351	341		recent Federal Decennial Census, while maintaining or
352	342		increasing base payroll in subsequent years, or at
353	343		least One Million Dollars ($1,000,0 00.00) if the
354	344		facility is located in a county with a population of
355	345		seventy-five thousand (75,000) or more, according to
356	346		the most recent Federal Decennial Census, while
357	347		maintaining or increasing base payroll in subsequent
358	348		years; provided the payroll require ment of this
359	349		subparagraph shall be waived for claims for
360	350		exemptions, including claims previously denied or on
361	351		appeal on March 3, 2010, for all initial applications
362	352		for exemption filed on or after January 1, 2004, and
363	353		on or before March 31, 2009, and all su bsequent annual
364	354		exemption applications filed related to the initial
365	355		application for exemption, for an applicant, if the
366	356		facility has been located in Oklahoma for at least
367	357		fifteen (15) years engaged in marine engine
	358	+	manufacturing as defined under U.S. Indus try Number
	359	+	333618 of the NAICS Manual, latest revision, and has
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369		-	SB498 HFLR Page 8
370		-	BOLD FACE denotes Committee Amendments. 1
	361	+	ENGR. S. B. NO. 498 Page 8 1
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395		-	manufacturing as defined under U.S. Industry Number
396		-	333618 of the NAICS Manual, latest revision, and has
397	386		maintained an average employment of five hundred (500)
398	387		or more full-time-equivalent employees over a ten -year
399	388		period. Any applicant that qualifies for the payroll
400	389		requirement waiver as outlin ed in the previous
401	390		sentence and subsequently closes its Oklahoma
402	391		manufacturing plant prior to January 1, 2012, may be
403	392		disqualified for exemption and subject to recapture.
404	393		For an applicant engaged in paperboard manufacturing
405	394		as defined under U.S. Industry Number 322130 of the
406	395		NAICS Manual, latest revision, union master payouts
407	396		paid by the buyer of the facility to specified
408	397		individuals employed by the facility at the time of
409	398		purchase, as specified under the purchase agreement,
410	399		shall be excluded from payroll for purposes of this
411	400		section.
412	401		In order to provide certainty with respect to
413	402		investments in manufacturing facilities pertaining to
414	403		all initial applications for exemption filed on or
415	404		after January 1, 2016, the following definitions shall
416	405		apply:
417	406		(1) “base payroll” shall mean total payro ll adjusted
418	407		for any nonrecurring bonuses, exercise of stock
	408	+	option or stock rights and other nonrecurring,
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420		-	SB498 HFLR Page 9
421		-	BOLD FACE denotes Committee Amendments. 1
	410	+	ENGR. S. B. NO. 498 Page 9 1
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446		-	option or stock rights and other nonrecurring,
447	435		extraordinary items included in total payroll,
448	436		and
449	437		(2) “initial payroll” shall mean base payro ll for the
450	438		year immediately preceding the initial
451	439		construction, acquisition or expansion.
452	440		The Tax Commission shall verify payroll information
453	441		through the Oklahoma Employment Security Commission by
454	442		using reports from the Oklahoma Employment Security
455	443		Commission for the calendar year i mmediately preceding
456	444		the year for which initial application is made for
457	445		base-line payroll, which must be maintained or
458	446		increased for each subsequent year; provided, a
459	447		manufacturing facili ty shall have the option of
460	448		excluding from its payroll, for purposes of this
461	449		section:
462	450		i. payments to sole proprietors, members
463	451		of a partnership, members of a limited
464	452		liability company who own at least ten
465	453		percent (10%) of the capital of the
466	454		limited liability company or
467	455		stockholder-employees of a corporation
468	456		who own at least ten percent (10%) of
469	457		the stock in the corporation, and
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471		-	SB498 HFLR Page 10
472		-	BOLD FACE denotes Committee Amendments. 1
	459	+	ENGR. S. B. NO. 498 Page 10 1
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497	484		ii. any nonrecurring bonuses, exercise of
498	485		stock option or stock rights or other
499	486		nonrecurring, extraordinary items
500	487		included in total payroll numbers as
501	488		reported by the Oklaho ma Employment
502	489		Security Commission. A manufacturing
503	490		facility electing either option shall
504	491		indicate such election upon its
505	492		application for an exemption under this
506	493		section. Any manufacturing facility
507	494		electing either option shall submit
508	495		such information as t he Tax Commission
509	496		may require in order to verify payrol l
510	497		information. Payroll information
511	498		submitted pursuant to the provisions of
512	499		this paragraph shall be submitted to
513	500		the Tax Commission and shall be subject
514	501		to the provisions of Section 205 of
515	502		this title, and
516	503		b. the facility offers, or will offer within one hu ndred
517	504		eighty (180) days of the date of employment, a basic
518	505		health benefits plan to the full -time-equivalent
519	506		employees of the facility, which is determined by t he
520	507		Department of Commerce to consist of th e elements
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522		-	SB498 HFLR Page 11
523		-	BOLD FACE denotes Committee Amendments. 1
	509	+	ENGR. S. B. NO. 498 Page 11 1
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548	534		specified in subparagraph b of paragraph 1 o f
549	535		subsection A of Section 3603 of this title or elements
550	536		substantially equivalent thereto.
551	537		For purposes of this section, calculation of the amount of
552	538		increased base payroll shall be measured from the s tart of initial
553	539		construction or expansion to the comple tion of such construction or
554	540		expansion or for three (3) years from the start of initial
555	541		construction or expansion, whichever occurs first. The amount of
556	542		increased base payroll shall include payroll fo r full-time-
557	543		equivalent employees in this state who are employed by an entity
558	544		other than the facility which has previously or is currently
559	545		qualified to receive an exemption pursuant to the provisions of this
560	546		section and who are leased or otherwise provided to the facility, if
561	547		such employment did not exist in th is state prior to the start of
562	548		initial construction or expansion of the facility. The
563	549		manufacturing concern shall submit an affidavit to the Tax
564	550		Commission, signed by an officer, stating that the cons truction,
565	551		acquisition or expansion of the facility will result in a net
566	552		increase in the annualized base payroll as required by this
567	553		paragraph and that full -time-equivalent employees of the facility
568	554		are or will be offered a basic health benefits plan as req uired by
569	555		this paragraph. If, after the completion of s uch construction or
570	556		expansion or after three (3) years from the start of initial
571	557		construction or expansion, whichever occurs first, the construction,
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573		-	SB498 HFLR Page 12
574		-	BOLD FACE denotes Committee Amendments. 1
	559	+	ENGR. S. B. NO. 498 Page 12 1
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599	584		acquisition or expansion has not resulted in a net increase in the
600	585		amount of annualized base payroll, if r equired, or any other
601	586		qualification specified in this paragraph has not been met, the
602	587		manufacturing concern shall pay an amount equal to the amount of any
603	588		exemption granted, including penalties and int erest thereon, to the
604	589		Tax Commission for deposit to the Ad Valorem Reimbursement Fund;
605	590		5. If a facility fails to meet the base payroll requirement of
606	591		subparagraph a of paragraph 4 of this subsection, the payroll
607	592		requirement shall be waived for claims for exemptions, including
608	593		claims previously denied or on ap peal on June 1, 2009, for all
609	594		initial applications for exemption filed on or after January 1,
610	595		2004, and on or before March 31, 2009, and all subsequent annual
611	596		exemption applications filed related to su ch initial application for
612	597		exemption, for an applicant, if the facility:
613	598		a. has been located for at least five (5) years as of
614	599		March 31, 2009, in a county in Oklahoma with a
615	600		population of six hundred thousand (600, 000) or more,
616	601		b. is owned by an applicant that has been engaged in
617	602		manufacturing as defined under U.S. Industry Numbers
618	603		323110, 323111, 323121 and 323122 of the NAICS Manual,
619	604		latest revision,
620	605		c. is owned by an applicant that maintains a workforce of
621	606		at least three hundred (300) employees on June 1 ,
622	607		2009,
623	608
624		-	SB498 HFLR Page 13
625		-	BOLD FACE denotes Committee Amendments. 1
	609	+	ENGR. S. B. NO. 498 Page 13 1
626	610		2
627	611		3
628	612		4
629	613		5
630	614		6
631	615		7
632	616		8
633	617		9
634	618		10
635	619		11
636	620		12
637	621		13
638	622		14
639	623		15
640	624		16
641	625		17
642	626		18
643	627		19
644	628		20
645	629		21
646	630		22
647	631		23
648	632		24
649	633
650	634		d. is owned by an applicant that has filed mult iple
651	635		applications for exemption pursuant to this section,
652	636		and
653	637		e. is owned by an applicant that operates at least one
654	638		facility in this state of at least seven h undred
655	639		thirty thousand (730,000) square fe et on June 1, 2009.
656	640		In the event that any applicant obt aining a waiver of the payroll
657	641		requirement pursuant to this paragraph ceases to operate all of its
658	642		facilities in this state on or before a date that is four (4 ) years
659	643		after any initial application for an exemption is filed by su ch
660	644		applicant, all sums of pr operty taxes exempted under this paragraph
661	645		through a waiver of the payroll requirement that relate to such
662	646		application shall become due and payable as if such sums were
663	647		assessed in the year in which th e applicant ceases to opera te all of
664	648		its facilities in the state;
665	649		6. Any new, acquired or expanded automotive final assembly
666	650		manufacturing facility which does not meet the requirements of
667	651		paragraph 4 of this subse ction shall be granted an exemption only i f
668	652		all other requirements of this section are met and on ly if the
669	653		investment cost of the construction, acquisition or expansion of the
670	654		manufacturing facility is Three Hundred Million Dollars
671	655		($300,000,000.00) or mor e and the manufacturing facility retains a n
672	656		average employment of one thousand seven hundred fift y (1,750) or
673	657		more full-time-equivalent employees in the year in which the
674	658
675		-	SB498 HFLR Page 14
676		-	BOLD FACE denotes Committee Amendments. 1
	659	+	ENGR. S. B. NO. 498 Page 14 1
677	660		2
678	661		3
679	662		4
680	663		5
681	664		6
682	665		7
683	666		8
684	667		9
685	668		10
686	669		11
687	670		12
688	671		13
689	672		14
690	673		15
691	674		16
692	675		17
693	676		18
694	677		19
695	678		20
696	679		21
697	680		22
698	681		23
699	682		24
700	683
701	684		exemption is initially granted and in each of the four (4)
702	685		subsequent years only if a n average employment of one thousand seven
703	686		hundred fifty (1,750) or m ore full-time-equivalent employees is
704	687		maintained in the subsequent year. Any property installed to
705	688		replace property damaged by the tornado or natural disaster that
706	689		occurred May 8, 2003, may continue to receive the exemption prov ided
707	690		in this paragraph for the full five-year period based on the value
708	691		of the previously qualifying assets as of January 1, 2003. The
709	692		exemption shall continue in effect as long as all other
710	693		qualifications in this paragraph are met. If the average employ ment
711	694		of one thousand seven hundred fifty (1,750) or mor e full-time-
712	695		equivalent employees is reduced as a result of temporary layoffs
713	696		because of a tornado or natural disaster on May 8, 2003, then the
714	697		average employment requirement shall be waived for year 20 03 of the
715	698		exemption period. Calculation of the number of employees shall be
716	699		made in the same manner as required under Section 2357.4 of this
717	700		title for an investment tax credit. As used in this paragraph,
718	701		“expand” and “expansion” shall mean and include an y increase to the
719	702		size or scope of a facility as well a s any renovation, restoration,
720	703		replacement or remodeling of a facility which permits the
721	704		manufacturing of a new or redesigned product;
722	705		7. Any new, acquired, o r expanded computer data processing,
723	706		data preparation, or information processing services provide r
724	707		classified in Industrial Group Number 7374 of the SIC Manual, latest
725	708
726		-	SB498 HFLR Page 15
727		-	BOLD FACE denotes Committee Amendments. 1
	709	+	ENGR. S. B. NO. 498 Page 15 1
728	710		2
729	711		3
730	712		4
731	713		5
732	714		6
733	715		7
734	716		8
735	717		9
736	718		10
737	719		11
738	720		12
739	721		13
740	722		14
741	723		15
742	724		16
743	725		17
744	726		18
745	727		19
746	728		20
747	729		21
748	730		22
749	731		23
750	732		24
751	733
752	734		revision, and U.S. Industry Number 514210 of the North American
753	735		Industrial Classificatio n System (NAICS) Manual, latest revision,
754	736		may apply for exemptions un der this section for each ye ar in which
755	737		new, acquired, or expanded capital improvements to the facility are
756	738		made if:
757	739		a. there is a net increase in annualized payroll of the
758	740		applicant at any facility or facilities of the
759	741		applicant in this state of at least Two Hundred Fifty
760	742		Thousand Dollars ($250,000.00), which is attributable
761	743		to the capital improvements, or a net increase of
762	744		Seven Million Dollars ($7,000,000.00) or more in
763	745		capital improvements, while maintaining or increasing
764	746		payroll at the facility or faci lities in this state
765	747		which are included in the application, and
766	748		b. the facility offers, or will offer within one hundred
767	749		eighty (180) days of the date of employment of new
768	750		employees attributable to the capital improvements, a
769	751		basic health benefits plan to the full-time-equivalent
770	752		employees of the facility, which is determined by the
771	753		Department of Commerce to consist of the elements
772	754		specified in subparagraph b of paragraph 1 of
773	755		subsection A of Section 3603 of this title or elements
774	756		substantially equivalent t hereto;
775	757
776		-	SB498 HFLR Page 16
777		-	BOLD FACE denotes Committee Amendments. 1
	758	+	ENGR. S. B. NO. 498 Page 16 1
778	759		2
779	760		3
780	761		4
781	762		5
782	763		6
783	764		7
784	765		8
785	766		9
786	767		10
787	768		11
788	769		12
789	770		13
790	771		14
791	772		15
792	773		16
793	774		17
794	775		18
795	776		19
796	777		20
797	778		21
798	779		22
799	780		23
800	781		24
801	782
802	783		8. Effective Januar y 1, 2017, an entity engaged in electric
803	784		power generation by means of wind, as described by the North
804	785		American Industry Classification System, No. 221119, shal l not be
805	786		defined as a qualifying manufactu ring concern for purposes o f the
806	787		exemption otherwise au thorized pursuant to Section 6B of Article X
807	788		of the Oklahoma Constitution or qualify as a “manufacturing
808	789		facility” as defined in this section. No initial appl ication for
809	790		exemption shall be filed by or accepted from an entity en gaged in
810	791		electric power generation by means of wind on or after January 1,
811	792		2018; and
812	793		9. An entity or applicant engaged in an industry as defined
813	794		under U.S. Industry Number 324110 of the NAICS Manual, latest
814	795		revision, which has a pplied for or been granted an exemption for a
815	796		time period which began on or after calendar year 2012 and before
816	797		calendar year 2016 but which did not meet the payroll requirements
817	798		of subparagraph a of paragraph 4 of this subsection because of
818	799		nonrecurring bonuses, exercise of stock o ption or stock rights or
819	800		other nonrecurring, extraordinary items included in total payroll in
820	801		the previous year, shall be allowed an exemption, beginning with
821	802		calendar year 2016, for the number of years, including the calendar
822	803		year for which the exemption was denied, remaining in the entity’s
823	804		five-year exemption period, provided such entity attains or
824	805		increases payroll at or above the initial or base payroll
825	806		established for the exemption ; and
826	807
827		-	SB498 HFLR Page 17
828		-	BOLD FACE denotes Committee Amendments. 1
	808	+	ENGR. S. B. NO. 498 Page 17 1
829	809		2
830	810		3
831	811		4
832	812		5
833	813		6
834	814		7
835	815		8
836	816		9
837	817		10
838	818		11
839	819		12
840	820		13
841	821		14
842	822		15
843	823		16
844	824		17
845	825		18
846	826		19
847	827		20
848	828		21
849	829		22
850	830		23
851	831		24
852	832
853	833		10. A facility engaged in manufacturing defined under U.S.
854	834		Industry Number 327310 of the NAICS Manual shall have the payroll
855	835		requirements of paragraph 4 of this subsection waived for tax year
856	836		2021, which is based in part on the 2020 calendar year payroll
857	837		reported to the Oklahoma Employment Se curity Commission, and may
858	838		continue to receive the exemption for the five-year period provided
859	839		in this section only if all other requirements of this section are
860	840		met.
861	841		D. 1. Except as provided in paragraph 2 of this subsection,
862	842		the five-year period of exemption from ad valorem taxe s for any
863	843		qualifying manufacturing facility property shall begin on January 1
864	844		following the initial qualifying use of the property in the
865	845		manufacturing process.
866	846		2. The five-year period of exemption from ad valorem taxes for
867	847		any qualifying manufacturing fa cility, as specified in subparagraphs
868	848		a and b of this paragraph, which is locat ed within a tax incentive
869	849		district created pursuant to the Local Developm ent Act by a county
870	850		having a population of at least five hundred thousand (50 0,000),
871	851		according to the most recent Federal De cennial Census, shall begin
872	852		on January 1 following the expi ration or termination of the ad
873	853		valorem exemption, abatement, or other in centive provided through
874	854		the tax incentive district. Facilities qualifying p ursuant to this
875	855		subsection shall include:
876	856
877		-	SB498 HFLR Page 18
878		-	BOLD FACE denotes Committee Amendments. 1
	857	+	ENGR. S. B. NO. 498 Page 18 1
879	858		2
880	859		3
881	860		4
882	861		5
883	862		6
884	863		7
885	864		8
886	865		9
887	866		10
888	867		11
889	868		12
890	869		13
891	870		14
892	871		15
893	872		16
894	873		17
895	874		18
896	875		19
897	876		20
898	877		21
899	878		22
900	879		23
901	880		24
902	881
903	882		a. a manufacturing facility as defined in subparagraph c
904	883		of paragraph 1 of subsection B of this section, and
905	884		b. an establishment primaril y engaged in distribution as
906	885		defined under Industry Number 49311 of the North
907	886		American Industry Classifi cation System for wh ich the
908	887		initial capital investment was at least One Hundred
909	888		Eighty Million Dollars ($180,000,000.00); provided,
910	889		that the qualifying job creation and depreciable
911	890		property investment occurred prior to calendar y ear
912	891		2017 but not earlier th an calendar year 201 3.
913	892		E. Any person, firm or corporation claiming the exempti on
914	893		herein provided for shall file each year for which exemption is
915	894		claimed, an application therefor with the county assessor of the
916	895		county in which the new, expanded or acquired facility is located.
917	896		The application shall be on a form or forms prescribed b y the Tax
918	897		Commission, and shall be filed on or before March 15, except as
919	898		provided in Section 2902.1 of this title, of each year in which the
920	899		facility desires to take the exempt ion or within thirty (30) days
921	900		from and after receipt by such person, firm or c orporation of notice
922	901		of valuation increase, whichever is later. In a cas e where
923	902		completion of the facility or facilities will occur after January 1
924	903		of a given year, a facility may apply to claim t he ad valorem tax
925	904		exemption for that year. If such facilit y is found to be qualified
926	905		for exemption, the ad valorem tax exemption pr ovided for herein
927	906
928		-	SB498 HFLR Page 19
929		-	BOLD FACE denotes Committee Amendments. 1
	907	+	ENGR. S. B. NO. 498 Page 19 1
930	908		2
931	909		3
932	910		4
933	911		5
934	912		6
935	913		7
936	914		8
937	915		9
938	916		10
939	917		11
940	918		12
941	919		13
942	920		14
943	921		15
944	922		16
945	923		17
946	924		18
947	925		19
948	926		20
949	927		21
950	928		22
951	929		23
952	930		24
953	931
954	932		shall be granted for that entire year and shall apply to th e ad
955	933		valorem valuation as o f January 1 of that given year. For
956	934		applicants which qualify under the provisi ons of subparagraph b of
957	935		paragraph 1 of subsection B of this section, the application shall
958	936		include a copy of the affidavit and any other information required
959	937		to be filed with the Tax Commission.
960	938		F. The application shall be examined by the county assessor and
961	939		approved or rejected in the same manner as provided by law for
962	940		approval or rejection of claims for homestead exemptions. The
963	941		taxpayer shall have the same right of review b y and appeal from th e
964	942		county board of equalization, in the same manner and subj ect to the
965	943		same requirements as provided by law for review and appeals
966	944		concerning homestead exemption claims. Approved applications shall
967	945		be filed by the county assessor with t he Tax Commission no later
968	946		than June 15, except as provided in Section 2902.1 o f this title, of
969	947		the year in which the facility desires to take the exemp tion.
970	948		Incomplete applications and applications filed after June 15 will be
971	949		declared null and void by th e Tax Commission. I n the event that a
972	950		taxpayer qualified to receive an exempti on pursuant to the
973	951		provisions of this section shall make payment of ad va lorem taxes in
974	952		excess of the amount due, the county treasurer shall have the
975	953		authority to credit the tax payer’s real or personal property tax
976	954		overpayment against current taxes due. T he county treasurer may
977	955
978		-	SB498 HFLR Page 20
979		-	BOLD FACE denotes Committee Amendments. 1
	956	+	ENGR. S. B. NO. 498 Page 20 1
980	957		2
981	958		3
982	959		4
983	960		5
984	961		6
985	962		7
986	963		8
987	964		9
988	965		10
989	966		11
990	967		12
991	968		13
992	969		14
993	970		15
994	971		16
995	972		17
996	973		18
997	974		19
998	975		20
999	976		21
1000	977		22
1001	978		23
1002	979		24
1003	980
1004	981		establish a schedule of up to five (5) years of c redit to resolve
1005	982		the overpayment.
1006	983		G. Nothing herein shall in any manner affe ct, alter or impair
1007	984		any law relating to the assessment of property, and all property,
1008	985		real or personal, wh ich may be entitled to exemption hereunder shall
1009	986		be valued and assessed a s is other like property and as provided by
1010	987		law. The valuation and assessmen t of property for which an
1011	988		exemption is granted hereunder shall be performed by the Tax
1012	989		Commission.
1013	990		H. The Tax Commission shall have the authority and duty to
1014	991		prescribe forms and to promulgate rules as may be necessary to carry
1015	992		out and administer the term s and provisions of this se ction.
1016	993		SECTION 2. It being immediately necessary for the prese rvation
1017	994		of the public peace, health or safety, an emergency is hereby
1018	995		declared to exist, by reason whereof this act shall take effect and
1019	996		be in full force from and after its pas sage and approval.
1020	997
1021		-	COMMITTEE REPORT BY: COMMITTEE ON APPROPRIATIONS AND BUDGET, dated
1022		-	04/15/2021 - DO PASS, As Amended.
	998	+	ENGR. S. B. NO. 498 Page 21 1
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	1022	+
	1023	+	Passed the Senate the 9th day of March, 2021.
	1024	+
	1025	+
	1026	+
	1027	+	Presiding Officer of the Senate
	1028	+
	1029	+
	1030	+	Passed the House of Representatives the ____ day of __________,
	1031	+	2021.
	1032	+
	1033	+
	1034	+
	1035	+	Presiding Officer of the House
	1036	+	of Representatives
	1037	+