SB312

By Senator Marsh

ENROLLED, An Act,

To amend Sections 1, 2, and 3 of Act 2015-27, now appearing as Sections 40-18-370 and 40-18-376.2, Code of Alabama 1975, relating to the Alabama Jobs Act, to provide that companies that employed eligible employees by or through a qualifying project located within a former active duty military installation closed by the Base Realignment and Closure process are entitled to an additional jobs credit.

BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:Section 1. Sections 1, 2, and 3 of Act 2015-27, now appearing as Sections 40-18-370 and 40-18-376.2, and Section 41-23-21, Code of Alabama 1975, are amended to read as follows:

§40-18-370.

"(a) This article shall be known and may be cited as the Alabama Jobs Act.

"(b) The Legislature makes the following findings:

"(1) The economic well-being of the citizens of the state will be enhanced by the increased development and growth of employment within Alabama.

"(2) It is in the best interests of the state to provide certain incentives to allow the state to foster economic development through the recruitment of quality projects and the expansion of existing businesses within Alabama.

"(3) The incentives provided for in this article do not raise any taxes for any individuals or businesses in Alabama under state law.

"(4) The incentives provided in this article will allow the state to encourage the creation of new jobs that may not otherwise exist within the State of Alabama.

"(5) The incentives provided in this article will increase revenues for the state without increasing taxes.

"(6) The Constitution of the State of Alabama grants the Legislature the authority to approve and authorize exemptions, exclusions, deductions, and credits from taxation in order to define the net proceeds of any tax payable under state law.

"(7) The Constitution of the State of Alabama was framed, and the laws of the state were enacted, with the goal of protecting, encouraging, and developing individual enterprise.

"(8) The incentives provided in this article will not decrease the salary paid to any education personnel.

"(9) The powers to be granted and the purposes to be accomplished by this article will create an environment for the recruitment of quality projects and the expansion of existing businesses within Alabama.

"(10) Economic development through tax and financial incentives benefits the citizens of the state and is a public purpose of the state.

"(c) In addition to the definitions found at Section 40-18-1, the following words and phrases shall have the following meanings:

"(1) APPROVED COMPANY. Any company determined by the Secretary of Commerce and the Governor to meet the criteria provided in Section 40-18-373.

"(2) CAPITAL INVESTMENT. All costs and expenses incurred by the incentivized company in connection with the acquisition, construction, installation, and equipping of a qualifying project, if such costs are required to be capitalized for purposes of the federal income tax, determined without regard to any rule that permits expenditures properly chargeable to a capital account to be treated as current expenditures. However, for any project involving the extraction of natural resources, the capital investment shall not include the costs of acquiring land, land recording fees, architectural and engineering services, environmental studies and environmental mitigation.

"(3) COMPANY. Anyone or anything which has the powers to own a project and have employees.

"(4) ELIGIBLE EMPLOYEES. Those employee positions set forth in a project agreement that will be the result of new jobs created by or through a qualifying project.

"(5) EMPLOYEES. Some or all of those persons employed and residing in Alabama:

"a. Who are being paid directly by an approved company, related company, common paymaster, joint venturer, or leasing company for working at a qualifying project;

"b. Whom the approved company, related company, common paymaster, joint venturer or leasing company identifies as its employees to the U.S. Internal Revenue Service, the Department of Revenue, or the Department of Labor on returns or reports filed with the foregoing, including, but not limited to, IRS Form 941; and

"c. Who are assigned to a qualifying project for a period of at least one year.

"(6) INCENTIVE PERIOD. The period or periods of time during which an incentivized company can receive one or more of the jobs act incentives.

"(7) INCENTIVIZED COMPANY. An approved company and any related company that are allowed to claim either or both one or more of the jobs act incentives as provided for in the project agreement.

"(8) INVESTMENT CREDIT. The annual incentive provided in Section 40-18-376.

"(9) JOBS ACT INCENTIVES. The jobs credit and the investment credit as authorized and provided for in this article.

"(10) JOBS CREDIT. The annual incentive provided in Section 40-18-375.

"(11) NAICS CODE. Any sector, subsector, industry group, industry or national industry of the 2012 North American Industry Classification System, or any similar classification system developed in conjunction with the United States Department of Commerce or Office of Management and Budget.

"(12) PROJECT. Any land, building, or other improvements, and all real and personal properties, whether or not contiguous and whether or not previously in existence, if in Alabama and if deemed necessary or useful in connection with an activity listed in Section 40-18-372(a).

"(13) PROJECT AGREEMENT. The agreement entered into between an approved company and the Governor establishing the terms and conditions for the provision of the jobs act incentives, as provided for in Section 40-18-374.

"(14) QUALIFYING PROJECT. Any project to be undertaken by an approved company that satisfies Section 40-18-372.

"(15) RELATED COMPANY. Any company that is under common ownership, management, or control with a company or an approved company, as the case may be.

"(16) UTILITY TAXES. The taxes imposed by Sections 40-21-82 and 40-21-102.

"(17) WAGES. Total wages of an employee (including gross wages, salaries, overtime and bonuses), defined by reference to Section 25-4-16(b), without application of Sections 25-4-16(b)(1), 25-4-16(b)(2)a., 25-4-16(b)(3), and 25-4-16(b)(4).

§40-18-376.2.

"(a) The provisions in this section shall apply to the following:

"any (1) Any incentivized company that employed, in the prior year, at least 12 percent of its eligible employees as veterans who received an honorable or general discharge. The calculation of the percentage of eligible employees who are veterans shall be made using the method provided in a project agreement.

"(2) Any incentivized company that employed eligible employees by or through a qualifying project located within a former active duty military installation closed by the Base Realignment and Closure process.

"(b)(1) Any incentivized company described by subdivision (1) of subsection (a) shall receive an additional 0.5 percent jobs credit provided in Section 40-18-375(a) on the wages paid during the prior year to eligible employees who are veterans.

"(2) Any incentivized company described by subdivision (2) of subsection (a) shall receive an additional 0.5 percent jobs credit provided in Section 40-18-375(a) on the wages paid during the prior year to its eligible employees.

"(c) No incentivized company claiming the credit provided by subdivision (1) of subsection (b) shall also claim the credit provided by Article 13 of this chapter for any portion of the project.

"(d) The Department of Labor shall periodically verify the actual number of veterans employed by the incentivized company described in subdivision (1) of subsection (a) and the wages of the veterans during the relevant year. If the Department of Labor is not able to provide the verification utilizing all available resources, it may request any additional information from the incentivized company as may be necessary."

"§41-23-21.

"For purposes of this article, the following terms shall have the meaning hereinafter ascribed to them, unless the context clearly indicates otherwise:

"(1) COUNCIL. The Enterprise Zone Advisory Council.

"(2) DEPARTMENT. The Alabama Department of Economic and Community Affairs.

"(3) GOVERNING AUTHORITY. The governing body of a county or municipality.

"(4) ENTERPRISE ZONE. A geographic area which is economically depressed, in need of expansion of business and industry and the creation of jobs and designated to be eligible for the benefits of this article, and is a target by governments for development by providing tax and nontax incentives to private enterprise. Effective October 1, 2016, the definition of an Enterprise Zone shall mean any Alabama county that is described by Section 40-18-376.1(a), Code of Alabama, 1975. Notwithstanding any other law or agreement to the contrary, any eligible business having received an approved application from the department prior to October 1, 2016 shall continue to receive those approved exemptions for the period of time specified in those agreements.

"(5) RURAL ENTERPRISE ZONE. An enterprise zone located in a non-MSA county, as such is defined by the United States Bureau of the Census.

"(6) URBAN ENTERPRISE ZONE. An enterprise zone located in an MSA county, as such is defined by the United States Bureau of the Census.”

Section 2. This act shall become effective immediately following its passage and approval by the Governor, or its otherwise becoming law.

Economic Development

Military

Commerce Department

Business and Commerce

Popular Names

Acts Amended

Code Amended