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STATE OF OKLAHOMA
1st Session of the 59th Legislature (2023)
COMMITTEE SUBSTITUTE
FOR
SENATE BILL 1176 By: Thompson (Roger) and Hall
of the Senate
and
Wallace and Martinez of the
House
COMMITTEE SUBSTITUTE
An Act relating to economic development; amending
Sections 4 and 6, Chapter 66, O.S.L. 2022 (68 O.S.
Supp. 2022, Sections 3645.4 and 3645.6), which relate
to the Large-scale Economic Activity and Development
Act of 2022; modifying certain job thresho ld
requirement; requiring transfer of funds if certain
commitment is not received by the Oklahoma Department
of Commerce by certain date ; updating statutory
language; updating statutory reference s; and
declaring an emergency.
BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:
SECTION 1. AMENDATORY Section 4, Chapter 66, O.S.L. 2022
(68 O.S. Supp. 2022, Section 3645.4), is amended t o read as follows:
Section 3645.4. A. 1. There is hereby created until July 1,
2032, an investment rebate program for the cost of qualified capital
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expenditures by establishments which cre ate not less than a
threshold number of new direct jobs as provided in this section.
2. a. The threshold number of new direct jobs required for
establishments to qualify and remain qualified for
investment rebate payments created in paragraph 1 of
this subsection shall be as follows :
(1) five hundred (500) new direct jobs in year one of
the rebate payment period,
(2) one thousand (1,000) cumulative new direct jobs
in year two of the rebate payment period,
(3) two thousand five hundred (2,500) cumulative new
direct jobs in year three of the rebate payment
period,
(4) four thousand (4,000) three thousand five hundred
(3,500) cumulative new direct jobs in year four
of the rebate payment period, and
(5) four thousand (4,000) three thousand five hundred
(3,500) cumulative new direct jobs in year five
of the rebate payment period.
b. For establishments qualifying for investment rebate
payments pursuant to division (2) of subparagraph a of
paragraph 1 of subsection E of this section, the
threshold numbers provided in this paragraph shall be
reduced proportionally to reflect the lesser capital
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expenditure of such establishment. Such reduction
shall be achieved by multiplying the thresholds in
paragraph 2 of this subsection by a fractional
equivalent equal to the following: the capital
expenditure plan amount of the establishment
qualifying pursuant to division (2) of subparagraph a
of paragraph 1 of subsection E of this section,
divided by the capital expenditure plan amount of the
establishment qualifying pursuant to division (1) of
subparagraph a of paragraph 1 of subsec tion E of this
section.
3. New direct jobs in this state of a subsidiary of a primary
establishment, if such subsidiary is defined or classified in the
NAICS Manual under Industry Group No. 5132, 5222, or 5413, shall be
aggregated with the number of new direct jobs in the state of the
primary establishment for the purpose of determining if the
thresholds provided in paragraph 2 of this subsection are met.
B. The investment rebate program shall be administered by the
Oklahoma Department of Commerce and the Oklahoma Tax Commission.
C. By October 1 of each year, the Oklahoma Department of
Commerce shall submit electronically an annual report to the Speaker
of the Oklahoma House of Representatives, the President Pro Tempore
of the Oklahoma State Senate, the Chair of the Appropriations and
Budget Committee of the Oklahoma House of Representatives, the Chair
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of the Appropriations Committee of the Oklahoma State Senate, and
the Executive Director of the Legislative Office of Fiscal
Transparency detailing the program and investment rebate payments.
D. The Oklahoma Department of C ommerce and the Oklahoma Tax
Commission may promulgate rules to implement the provisions of this
act the Large-scale Economic Activity and Development Act o f 2022
(LEAD Act).
E. To be eligible for consideration for an investment rebate
payment awarded under the provisions of this act the LEAD Act, a
primary establishment shall:
1. a. (1) Submit an application and documentation to the
Oklahoma Department of Commerce, as required by
the Department, outlining a capital expenditure
plan in this state associated with qualified
capital expenditures totaling no less than Three
Billion Six Hundred Six Million Dollars
($3,606,000,000.00), or
(2) Submit an application and documentation to the
Oklahoma Department of Commerce, as required by
the Department, outlining a capital expenditure
plan in this state associated with qualified
capital expenditures totaling no less than Five
Hundred Million Dollars ($500,000,000.00),
provided a separate establishment has been
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approved by the Oklahoma Department of Commerce
to participate in the investment rebate program
pursuant to division (1) of this subparagraph ,
and such establishment participating pursuant to
division (1) of this subparagraph remains in
compliance with such approved application, and
b. Have made qualified capital expenditures of no less
than twenty percent (20%) of the capital expenditure
plan outlined in the application submitted by the
primary establishment and approved by the Oklahoma
Department of Commerce, pursuant to the provisions of
this act the LEAD Act.
New investment in this state of a subsidiar y of a primary
establishment, if su ch subsidiary is defined or classified in the
NAICS Manual under Industry Group No. 5132, 5222, or 5413, shall be
aggregated with the investment in this state of the primary
establishment for the purpose of determining if the thresholds
provided in this paragraph are met;
2. Be qualified to receive payments pursuant to the provisions
of the Oklahoma Quality Jobs Pr ogram Act created pursuant to Section
3601 of Title 68 of the Oklahoma Statutes; and
3. Have filed all Oklahoma tax returns and tax documents
required by law.
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F. 1. Notwithstanding any other provision of law, if a primary
establishment receives an investment rebate payment pursuant to the
provisions of this act the LEAD Act, neither the qualified
establishment nor its subsidiaries shall be eligible to receive the
credits provided for in Section 2357.4 of Title 68 of the Oklahoma
Statutes, in connection with the project or development for which
the investment rebate payment was based; provided, however, the
limitation provided in this paragraph, on claiming credits, shall
not apply to the amount of qualifying capital expenditure in excess
of Four Billion Five Hundred Million Dollars ($4,500,000,000.00)
made by an establishment on a project or development in this state.
2. Notwithstanding any other provision of law, no investment
expenditure shall be utilized for calculation purposes in a way that
results in the qualification of more than one establishment under
the provisions of this act the LEAD Act, for investment rebate
payments based on the same expenditure.
3. Notwithstanding any other provision of law, no investment
rebate payment amount pre-qualified or pre-encumbered by the
Oklahoma Department of Commerce for an establishment qualifying for
payment under the provisions of division (1) of sub paragraph a of
paragraph 1 of subsection E of this section, shall be re allocated to
an establishment that at such time is participating under an
approved application pursuant to division (2) of subparagraph a of
paragraph 1 of subsection E of this sectio n.
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G. 1. Except as limited by paragraph 2 of this subsection, the
Oklahoma Department of Commerce shall approve or disapprove claims
for rebates and shall notify the Tax Commission subject to the
limitations set forth in Section 5 of this act 3645.5 of this title.
Upon notification of approval from the Department, the Commission
shall issue payment for all approved claims from funds held in the
Large-scale Economic Activity and Development Fund created pursuant
to Section 6 of this act 3645.6 of this title and subject to the
limitations set forth in Section 5 of this act 3645.5 of this title.
2. The Department shall disapprove all applications and claims,
as well as portions of applications and claims, for rebates that
would exceed the balance of available funds in the Large-scale
Economic Activity and Development Fund.
H. The total amount of applications approved and investment
rebate payments awarded under the provisions of this act the LEAD
Act shall not exceed the total amount of monies designated by law
for deposit to the Large-scale Economic Activity and Development
Fund.
SECTION 2. AMENDATORY Section 6, Chapter 66, O.S.L. 2022
(68 O.S. Supp. 2022, Section 3645.6), is amended to read as follows:
Section 3645.6. A. There is hereby created in the State
Treasury a fund for the Oklahoma Tax Commission to be designated the
"Large-scale Economic Activity and Development Fund", also known as
the "LEAD Fund". The fund shall be a continuing fund, not subje ct
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to fiscal year limitations, and shall consist of all monies
designated for deposit to the fund by law. Al l monies accruing to
the credit of the fund are hereby appropriated and may be budgeted
and expended by the Tax Commission for the purpose of payin g rebates
as provided in the Large-scale Economic Activity and Development Act
of 2022. Expenditures from said such fund shall be made upon
warrants issued by the State Treasurer against claims filed as
prescribed by law with the Director of the Office of Management and
Enterprise Services for approval and payment.
B. All unencumbered funds remaining in the Large -scale Economic
Activity and Development Fund upon the expiration of the Large -scale
Economic Activity and Development Act of 2022 shall be trans ferred
to the State Treasurer for deposit in the General Revenue Fund.
C. If the Oklahoma Department of Commerce has not received a
binding commitment from a primary establishment for an investment
determined by the Department to qualify for payment under the
provisions of division (1) of subparagraph a of paragraph 1 of
subsection E of Section 3645.4 of this title by April 15, 2023, all
unencumbered funds remaining in the Large -scale Economic Activity
and Development Fund shall be transferred to the State Treasurer for
deposit in the General Revenue Fund of the State Treasury for the
fiscal year ending June 30, 202 2.
SECTION 3. It being immediately necessary for the preservation
of the public peace, health or safety, an emergency is hereby
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declared to exist, by reason whereof this act shall take effect and
be in full force from and after its passage an d approval.
59-1-1946 QD 2/27/2023 5:01:14 PM