An Act To Improve the Effectiveness of the Major Business Headquarters Expansion Tax Credit
Sec. 1. 36 MRSA §5219-QQ, as corrected by RR 2017, c. 1, §33, is amended to read:
§ 5219-QQ. Credit for major business headquarters expansions
(1) The applicant's headquarters are or will be located in the State;
(2) The applicant employs at least 5,000 full-time employees worldwide of which at least 25% are or will be based in this the State;
(3) The applicant has business locations in at least 3 other states or foreign countries; and
(4) The applicant intends to make a qualified investment in the State within 5 years following the date of the application.
(1) The transferee is a member of the applicant's unitary affiliated group at the time of the transfer; or
(2) The commissioner finds that the transferee will, and has the capacity to, maintain operations of the headquarters in the State in a manner that meets the minimum qualifications for continued eligibility of benefits under this section after the transfer occurs.
If the commissioner approves the transfer of the certificate, the transferee, from the date of the transfer, must be treated as the certified applicant and as eligible to claim any remaining benefit under the certificate of approval or the certificate of completion that has not been previously claimed by the transferor as long as the transferee meets the same eligibility requirements and conditions for the credit as applied to the original certified applicant.
The commissioner may not issue certificates of approval under this subsection that total, in the aggregate, more than $100,000,000 of qualified investment or any individual certificate of approval for more than $40,000,000 of qualified investment.
(1) A credit is not allowed for any tax year during which the taxpayer does not meet or exceed the following employment targets as measured on the last day of the tax year.
(a) For each of the first 10 tax years for which the credit is claimed, there must be a total of at least 80 additional full-time employees based in the State above the certified applicant's base level of employment whose jobs were added since the first day of the first tax year for which the credit was claimed multiplied by the number of years for which the credit has been claimed.
(b) For each tax year after the 10th tax year for which the credit is claimed, the taxpayer must employ a total of at least 800 additional full-time employees based in the State above the certified applicant's base level of employment whose jobs were added since the first day of the first tax year for which the credit was claimed.
Jobs for additional full-time employees that are counted for determining eligibility for the credit under one certificate of completion may not be counted for determining eligibility for the credit under a separate certificate of completion.
(2) Cumulative credits under this subsection may not exceed $16,000,000 under any one certificate.
(1) The number of all full-time employees based in this the State of the certified applicant on the last day of the tax year ending during the calendar year immediately preceding the report year; and
(2) The incremental amount of qualified investment made in the report year . ;
(3) The total number of additional full-time employees added in the State by the certified applicant above the certified applicant's base level of employment since the date a certificate of approval was issued;
(4) The incremental number of additional full-time employees added in the State by the certified applicant above the certified applicant's base level of employment during the report year;
(5) The average and median wages of all additional full-time employees above the certified applicant's base level of employment in the State whose jobs were added since the first day of the first tax year for which the credit was claimed; and
(6) The percentage and number of all additional full-time employees above the certified applicant's base level of employment who have access to retirement benefits and health benefits.
The commissioner may prescribe forms for the annual report described in this paragraph. The commissioner shall provide copies of the report to the State Tax Assessor and to the joint standing committee of the Legislature having jurisdiction over taxation matters at the time the report is received.
Notwithstanding any other provision of law to the contrary, the reports provided under this subsection are public records as defined in Title 1, section 402, subsection 3.
(1) The number of additional full-time employees added during a period being reviewed and how employment during that period compares to the minimum employment requirements set forth in subsection 3, paragraph B;
(2) The amount of qualified investment during a period being reviewed, and how expenditures compare to the minimum level of expenditure set forth in subsection 1, paragraph H;
(3) The change in the number of major business headquarters located in the State and the number of expansions of those headquarters during a period being reviewed;
(4) Measures of fiscal impact and overall economic impact to the State; and
(5) The number of new employees for whom health benefits and retirement benefits are available.
This bill makes the following changes to improve the effectiveness of the income tax credit for major business expansions.
1. It provides that the number of additional employees that must be added by a certified applicant must be determined based on the number of qualifying employees above the certified applicant's base level of employment.
2. It provides that a certificate of completion issued by the Commissioner of Economic and Community Development must state the amount of the qualified investment made by the certified applicant, and it clarifies that the credit is 2% of the lesser of the amount of actual qualified investment specified in the certified applicant's certificate of completion and the amount of qualified investment approved in the certificate of approval.
3. It amends reporting requirements and establishes evaluation guidance to improve the future review of the credit under the Maine Revised Statutes, Title 3, chapter 37 by the Office of Program Evaluation and Government Accountability, the joint legislative committee established to oversee program evaluation and government accountability matters and the joint standing committee of the Legislature having jurisdiction over taxation matters.
4. It clarifies that, if a certificate of approval has been transferred, the transferee is responsible for any repayment obligations if there is a recapture of credit amounts.