Rep. Norm Thurston — Voting Record

Bill

Number

H.B. 320 (2021GS)

Sponsor

Rep. Sagers, D.

Final action

House/ filed 3/5/2021

Outcome

Failed / filed without passage

Summary

What it does

• This bill:
• authorizes for a specified time, an enterprise zone tax credit for certain investments in a plant, equipment, or other depreciable property used to:
• produce or process from a renewable source, hydrogen for use as fuel; or
• distribute or dispense hydrogen fuel produced from a renewable energy source;
• allows a taxpayer to claim enterprise zone income tax credits against taxes owed under the Gross Receipts Tax on Certain Corporations Not Required to Pay Corporate Franchise or Income Tax Act; and
• makes technical changes.

Every vote on this bill

Bill text

ENTERPRISE ZONE TAX CREDIT AMENDMENTS
GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Douglas V. Sagers
Senate Sponsor: 
 David P. Hinkins
LONG TITLE
General Description:
This bill amends the enterprise zone income tax credits.
Highlighted Provisions:
This bill:
▸ authorizes for a specified time, an enterprise zone tax credit for certain investments
in a plant, equipment, or other depreciable property used to:
• produce or process from a renewable source, hydrogen for use as fuel; or
• distribute or dispense hydrogen fuel produced from a renewable energy source;
▸ allows a taxpayer to claim enterprise zone income tax credits against taxes owed
under the Gross Receipts Tax on Certain Corporations Not Required to Pay
Corporate Franchise or Income Tax Act; and
▸ makes technical changes.
Money Appropriated in this Bill:
None
Other Special Clauses:
This bill provides a special effective date.
Utah Code Sections Affected:
AMENDS:
59-7-614.10
, as last amended by Laws of Utah 2020, Chapter 354
59-10-1037
, as last amended by Laws of Utah 2020, Chapter 354
63I-2-263
, as last amended by Laws of Utah 2020, Fifth Special Session, Chapter 12
63N-2-213
, as last amended by Laws of Utah 2020, Chapter 360
ENACTS:
59-8-201
, Utah Code Annotated 1953
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 
59-7-614.10
 is amended to read:
59-7-614.10.
Nonrefundable enterprise zone tax credit.
(1) As used in this section:
(a) "Business entity" means a corporation that meets the definition of "business entity"
as that term is defined in Section 
63N-2-202
.
(b) "Office" means the Governor's Office of Economic Development created in Section
63N-1-201
.
(2) Subject to the provisions of this section, a business entity may claim a
nonrefundable enterprise zone tax credit as described in Section 
63N-2-213
.
(3) The enterprise zone tax credit under this section is the amount listed as the tax
credit amount on the tax credit certificate that the office issues to the business entity for the
taxable year.
(4) A business entity may carry forward a tax credit under this section for a period that
does not exceed the next three taxable years, if the amount of the tax credit exceeds the
business entity's tax liability under this chapter for that taxable year.
(5) A business entity may not claim or carry forward a tax credit under this [
part
]
section
 for a taxable year during which the business entity has claimed the targeted business
income tax credit under Section 
59-7-624
.
(6) (a) In accordance with Section 
59-7-159
, the Revenue and Taxation Interim
Committee shall study the tax credit allowed by this section and make recommendations
concerning whether the tax credit should be continued, modified, or repealed.
(b) (i) Except as provided in Subsection (6)(b)(ii), for purposes of the study required by
this Subsection (6), the office shall provide by electronic means the following information for
each calendar year to the Office of the Legislative Fiscal Analyst:
(A) the amount of tax credits provided in each development zone;
(B) the number of new full-time employee positions reported to obtain tax credits in
each development zone;
(C) the amount of tax credits awarded for rehabilitating a building in each development
zone;
(D) the amount of tax credits awarded for investing in a plant, equipment, or other
depreciable property in each development zone;
(E) the information related to the tax credit contained in the office's latest report under
Section 
63N-1-301
; and
(F) any other information that the Office of the Legislative Fiscal Analyst requests.
(ii) (A) In providing the information described in Subsection (6)(b)(i), the office shall
redact information that identifies a recipient of a tax credit under this section.
(B) If, notwithstanding the redactions made under Subsection (6)(b)(ii)(A), reporting
the information described in Subsection (6)(b)(i) might disclose the identity of a recipient of a
tax credit, the office may file a request with the Revenue and Taxation Interim Committee to
provide the information described in Subsection (6)(b)(i) in the aggregate for all development
zones that receive the tax credit under this section.
(c) As part of the study required by this Subsection (6), the Office of the Legislative
Fiscal Analyst shall report to the Revenue and Taxation Interim Committee a summary and
analysis of the information provided to the Office of the Legislative Fiscal Analyst by the
office under Subsection (6)(b).
(d) The Revenue and Taxation Interim Committee shall ensure that the
recommendations described in Subsection (6)(a) include an evaluation of:
(i) the cost of the tax credit to the state;
(ii) the purpose and effectiveness of the tax credit; and
(iii) the extent to which the state benefits from the tax credit.
Section 2. Section 
59-8-201
 is enacted to read:
Part 2. Tax Credits
 59-8-201.
Nonrefundable enterprise zone tax credit.
(1) As used in this section:
(a) "Business entity" means an organization subject to the tax imposed by this part that
is a business entity as defined in Section 
63N-2-202
.
(b) "Office" means the Governor's Office of Economic Development created in Section
63N-1-201
.
(2) Subject to the provisions of this section, a business entity may claim a
nonrefundable enterprise zone tax credit as described in Section 
63N-2-213
.
(3) The enterprise zone tax credit under this section is the amount listed as the tax
credit amount on the tax credit certificate that the office issues to the business entity for the
taxable year.
(4) A business entity may carry forward a tax credit under this section for a period that
does not exceed the next three taxable years, if the amount of the tax credit exceeds the
business entity's tax liability under this chapter for that taxable year.
(5) (a) The Revenue and Taxation Interim Committee shall:
(i) study the tax credit allowed by this section as part of the Revenue and Taxation
Interim Committee's study under Subsection 
59-7-164.10
(6); and
(ii) make recommendations concerning whether the tax credit should be continued,
modified, or repealed.
(b) Except as provided in Subsection (5)(c), for purposes of the study required by this
Subsection (5), the office shall provide by electronic means the following information for each
calendar year to the Office of the Legislative Fiscal Analyst:
(i) the amount of tax credits provided in each development zone;
(ii) the number of new full-time employee positions reported to obtain tax credits in
each development zone;
(iii) the amount of tax credits awarded for rehabilitating a building in each
development zone;
(iv) the amount of tax credits awarded for investing in a plant, equipment, or other
depreciable property in each development zone;
(v) the information related to the tax credit contained in the office's latest report under
Section 
63N-1-301
; and
(vi) any other information that the Office of the Legislative Fiscal Analyst requests.
(c) (i) In providing the information described in Subsection (5)(b), the office shall
redact information that identifies a recipient of a tax credit under this section.
(ii) If, notwithstanding the redactions made under Subsection (5)(c)(i), reporting the
information described in Subsection (5)(b)(i) might disclose the identity of a recipient of a tax
credit, the office may file a request with the Revenue and Taxation Interim Committee to
provide the information described in Subsection (5)(b)(i) in the aggregate for all development
zones that receive the tax credit under this section.
(d) As part of the study required by this Subsection (5), the Office of the Legislative
Fiscal Analyst shall report to the Revenue and Taxation Interim Committee a summary and
analysis of the information provided to the Office of the Legislative Fiscal Analyst by the
office under Subsection (5)(b).
(e) The Revenue and Taxation Interim Committee shall ensure that the
recommendations described in Subsection (5)(a) include an evaluation of:
(i) the cost of the tax credit to the state;
(ii) the purpose and effectiveness of the tax credit; and
(iii) the extent to which the state benefits from the tax credit.
Section 3. Section 
59-10-1037
 is amended to read:
59-10-1037.
Nonrefundable enterprise zone tax credit.
(1) As used in this section:
(a) "Business entity" means a claimant, estate, or trust that meets the definition of
"business entity" as that term is defined in Section 
63N-2-202
.
(b) "Office" means the Governor's Office of Economic Development created in Section
63N-1-201
.
(2) Subject to the provisions of this section, a business entity may claim a
nonrefundable enterprise zone tax credit as described in Section 
63N-2-213
.
(3) The enterprise zone tax credit under this section is the amount listed as the tax
credit amount on the tax credit certificate that the office issues to the business entity for the
taxable year.
(4) A business entity may carry forward a tax credit under this section for a period that
does not exceed the next three taxable years, if the amount of the tax credit exceeds the
business entity's tax liability under this chapter for that taxable year.
(5) A business entity may not claim or carry forward a tax credit under this [
part
]
section
 for a taxable year during which the business entity has claimed the targeted business
income tax credit under Section 
59-10-1112
.
(6) (a) In accordance with Section 
59-10-137
, the Revenue and Taxation Interim
Committee shall study the tax credit allowed by this section and make recommendations
concerning whether the tax credit should be continued, modified, or repealed.
(b) (i) Except as provided in Subsection (6)(b)(ii), for purposes of the study required by
this Subsection (6), the office shall provide by electronic means the following information, if
available to the office, for each calendar year to the Office of the Legislative Fiscal Analyst:
(A) the amount of tax credits provided in each development zone;
(B) the number of new full-time employee positions reported to obtain tax credits in
each development zone;
(C) the amount of tax credits awarded for rehabilitating a building in each development
zone;
(D) the amount of tax credits awarded for investing in a plant, equipment, or other
depreciable property in each development zone;
(E) the information related to the tax credit contained in the office's latest report under
Section 
63N-1-301
; and
(F) other information that the Office of the Legislative Fiscal Analyst requests.
(ii) (A) In providing the information described in Subsection (6)(b)(i), the office shall
redact information that identifies a recipient of a tax credit under this section.
(B) If, notwithstanding the redactions made under Subsection (6)(b)(ii)(A), reporting
the information described in Subsection (6)(b)(i) might disclose the identity of a recipient of a
tax credit, the office may file a request with the Revenue and Taxation Interim Committee to
provide the information described in Subsection (6)(b)(i) in the aggregate for all development
zones that receive the tax credit under this section.
(c) As part of the study required by this Subsection (6), the Office of the Legislative
Fiscal Analyst shall report to the Revenue and Taxation Interim Committee a summary and
analysis of the information provided to the Office of the Legislative Fiscal Analyst by the
office under Subsection (6)(b).
(d) The Revenue and Taxation Interim Committee shall ensure that the
recommendations described in Subsection (6)(a) include an evaluation of:
(i) the cost of the tax credit to the state;
(ii) the purpose and effectiveness of the tax credit; and
(iii) the extent to which the state benefits from the tax credit.
Section 4. Section 
63I-2-263
 is amended to read:
63I-2-263.
Repeal dates, Title 63A to Title 63N.
(1) On July 1, 2020:
(a) Subsection 
63A-1-203
(5)(a)(i) is repealed; and
(b) in Subsection 
63A-1-203
(5)(a)(ii), the language that states "appointed on or after
May 8, 2018," is repealed.
(2) Section 
63A-3-111
 is repealed June 30, 2021.
(3) Title 63C, Chapter 19, Higher Education Strategic Planning Commission is
repealed July 1, 2021.
(4) Title 63C, Chapter 22, Digital Wellness, Citizenship, and Safe Technology
Commission is repealed July 1, 2023.
(5) The following sections regarding the World War II Memorial Commission are
repealed on July 1, 2022:
(a) Section 
63G-1-801
;
(b) Section 
63G-1-802
;
(c) Section 
63G-1-803
; and
(d) Section 
63G-1-804
.
(6) Subsections 
63G-6a-802
(1)(d) and 
63G-6a-802
(3)(b)(iii), regarding a procurement
relating to a vice presidential debate, are repealed January 1, 2021.
(7) In relation to the State Fair Park Committee, on January 1, 2021:
(a) Section 
63H-6-104.5
 is repealed; and
(b) Subsections 
63H-6-104
(8) and (9) are repealed.
(8) Section 
63H-7a-303
 is repealed July 1, 2024.
(9) Subsection 
63J-1-206
(3)(c), relating to coronavirus, is repealed July 1, 2021.
(10) In relation to the Employability to Careers Program Board, on July 1, 2022:
(a) Subsection 
63J-1-602.1
(57) is repealed;
(b) Subsection 
63J-4-301
(1)(h), related to the review of data and metrics, is repealed;
and
(c) Title 63J, Chapter 4, Part 7, Employability to Careers Program, is repealed.
(11) Title 63M, Chapter 4, Part 8, Voluntary Home Energy Information Pilot Program
Act, is repealed January 1, 2022.
(12) Sections 
63M-7-213
 and 
63M-7-213.5
 are repealed on January 1, 2023.
(13) Subsection 
63N-2-213
(7)(g), which provides a tax credit related to property
primarily used to produce or process hydrogen for fuel or to distribute or dispense hydrogen
fuel, is repealed January 1, 2028.
[
(13)
] 
(14)
 Subsection 
63N-12-508
(3) is repealed December 31, 2021.
[
(14)
] 
(15)
 Title 63N, Chapter 13, Part 3, Facilitating Public-Private Partnerships Act,
is repealed January 1, 2024.
[
(15)
] 
(16)
 Title 63N, Chapter 15, COVID-19 Economic Recovery Programs, is
repealed December 31, 2021.
Section 5. Section 
63N-2-213
 is amended to read:
63N-2-213.
State tax credits.
(1) The office shall certify a business entity's eligibility for a tax credit described in this
section.
(2) A business entity seeking to receive a tax credit as provided in this section shall
provide the office with:
(a) an application for a tax credit certificate in a form approved by the office, including
a certification, by an officer of the business entity, of a signature on the application; and
(b) documentation that demonstrates the business entity has met the requirements to
receive the tax credit.
(3) If, after review of an application and documentation provided by a business entity
as described in Subsection (2), the office determines that the application and documentation are
inadequate to provide a reasonable justification for authorizing the tax credit, the office shall:
(a) deny the tax credit; or
(b) inform the business entity that the application or documentation was inadequate
and ask the business entity to submit additional documentation.
(4) If, after review of an application and documentation provided by a business entity
as described in Subsection (2), the office determines that the application and documentation
provide reasonable justification for authorizing a tax credit, the office shall:
(a) determine the amount of the tax credit to be granted to the business entity;
(b) issue a tax credit certificate to the business entity; and
(c) provide a duplicate copy of the tax credit certificate to the State Tax Commission.
(5) A business entity may not claim a tax credit under this section unless the business
entity has a tax credit certificate issued by the office.
(6) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the
office shall make rules describing:
(a) the form and content of an application for a tax credit under this section;
(b) the documentation requirements for a business entity to receive a tax credit
certificate under this section; and
(c) administration of the program, including relevant timelines and deadlines.
(7) Subject to the limitations of Subsections (8) through (10), and if the requirements
of this part are met, the following nonrefundable tax credits against a tax under Title 59,
Chapter 7, Corporate Franchise and Income Taxes, 
Title 59, Chapter 8, Gross Receipts Tax on
Certain Corporations Not Required to Pay Corporate Franchise or Income Tax Act,
 or Title 59,
Chapter 10, Individual Income Tax Act, are applicable in an enterprise zone:
(a) a tax credit of $750 may be claimed by a business entity for each new full-time
employee position created within the enterprise zone;
(b) an additional $500 tax credit may be claimed if the new full-time employee position
created within the enterprise zone pays at least 125% of:
(i) the county average monthly nonagricultural payroll wage for the respective industry
as determined by the Department of Workforce Services; or
(ii) if the county average monthly nonagricultural payroll wage is not available for the
respective industry, the total average monthly nonagricultural payroll wage in the respective
county where the enterprise zone is located;
(c) an additional tax credit of $750 may be claimed if the new full-time employee
position created within the enterprise zone is in a business entity that adds value to agricultural
commodities through manufacturing or processing;
(d) an additional tax credit of $200 may be claimed for each new full-time employee
position created within the enterprise zone that is filled by an employee who is insured under
an employer-sponsored health insurance program if the employer pays at least 50% of the
premium cost for the year for which the credit is claimed;
(e) a tax credit of 25% of the first $200,000 spent on rehabilitating a building in the
enterprise zone that has been vacant for two years or more, including that the building has had
or contained no occupants, tenants, furniture, or personal property for two years or more, in the
time period immediately before the rehabilitation; [
and
]
(f) an annual investment tax credit may be claimed in an amount equal to 5% of the first
$750,000 qualifying investment in plant, equipment, or other depreciable property[
.
]
; and
(g) for a taxable year beginning on or after January 1, 2022, and before January 1,
2026, an additional annual investment tax credit of 10% of the first $250,000 investment, 5%
of the next $1,000,000 investment, and 2.5% of the next $2,000,000 investment, in a plant,
equipment, or other depreciable property primarily used:
(i) to produce or process, from a renewable energy source, as defined in Section
54-17-601
, hydrogen for use as a fuel; or
(ii) to distribute or dispense hydrogen fuel produced from a renewable energy source,
as defined in Section 
54-17-601
.
(8) (a) Subject to the limitations of Subsection (8)(b), a business entity claiming a tax
credit under Subsections (7)(a) through (d) may claim the tax credit for no more than 30
full-time employee positions in a taxable year.
(b) A business entity that received a tax credit for one or more new full-time employee
positions under Subsections (7)(a) through (d) in a prior taxable year may claim a tax credit for
a new full-time employee position in a subsequent taxable year under Subsections (7)(a)
through (d) if:
(i) the business entity has created a new full-time position within the enterprise zone;
and
(ii) the total number of employee positions at the business entity at any point during the
tax year for which the tax credit is being claimed is greater than the highest number of
employee positions that existed at the business entity in the previous taxable year.
(c) Construction jobs are not eligible for the tax credits under Subsections (7)(a)
through (d).
(9) If the amount of a tax credit under this section exceeds a business entity's tax
liability under this chapter for a taxable year, the business entity may carry forward the amount
of the tax credit exceeding the liability for a period that does not exceed the next three taxable
years.
(10) Tax credits under [
Subsections (7)(a) through (f)
] 
Subsection (7)
 may not be
claimed by a business entity primarily engaged in retail trade or by a public utilities business.
(11) A business entity that has no employees:
(a) may not claim tax credits under Subsections (7)(a) through (d); and
(b) may claim tax credits under Subsections (7)(e) through [
(f)
] 
(g)
.
(12) (a) A business entity may not claim or carry forward a tax credit available under
this part for a taxable year during which the business entity has claimed the targeted business
income tax credit available under Section 
63N-2-304
.
(b) A business entity may not claim or carry forward a tax credit available under this
section for a taxable year during which the business entity claims or carries forward a tax credit
available under Section 
59-7-610
 or 
59-10-1007
.
(13) (a) On or before November 30, 2018, and every three years after 2018, the
Revenue and Taxation Interim Committee shall review the tax credits provided by this section
and make recommendations concerning whether the tax credits should be continued, modified,
or repealed.
(b) In conducting the review required by Subsection (13)(a), the Revenue and Taxation
Interim Committee shall:
(i) schedule time on at least one committee agenda to conduct the review;
(ii) invite state agencies, individuals, and organizations concerned with the credits
under review to provide testimony;
(iii) ensure that the recommendations described in this section include an evaluation of:
(A) the cost of the tax credits to the state;
(B) the purpose and effectiveness of the tax credits; and
(C) the extent to which the state benefits from the tax credits; and
(iv) undertake other review efforts as determined by the chairs of the Revenue and
Taxation Interim Committee.
Section 6. 
Effective date.
This bill takes effect for a taxable year beginning on or after January 1, 2022.