Printed Page 3350, May 29
| Printed Page 3370, May 29
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Printed Page 3350, May 29
| Printed Page 3370, May 29
| lowest assessment ratio allowed is the lowest ratio for which the business may qualify under this section./
Amend further, SECTION 7I, by striking Section 4-12-30(K)(3), page 14, beginning on line 31, and inserting:
/(3) A county or municipality or special purpose district that receives and retains revenues from a payment in lieu of taxes may use a portion of this revenue for the purposes outlined in Section 4-29-68 without the requirement of issuing special source revenue bonds or the requirements of Section 4-29-68(A)(4)./
Amend further, SECTION 7J, by striking Section 4-12-30(M)(1), page 15, beginning on line 3, and inserting:
/(1) Any interest in an inducement agreement, millage rate agreement, lease agreement, and property to which the agreement relates may be transferred to any other entity at any time. Notwithstanding any other provision of this chapter, any equity interest in any entity with an interest in any inducement agreement, millage rate agreement, or lease agreement may be transferred to any other entity or person at any time.
Amend further, by striking Section 4-12-40, as contained in SECTION 7L, page 17, and inserting:
/Section 4-12-40. Projects with respect to which a lease agreement has been entered into before January 1, 1996, the effective date of this chapter are required to use the provisions of Section 4-29-67. Projects with respect to which a lease agreement agreements is entered into after December 31, 1995, are required to use the provisions contained in this chapter. However, those projects with lease agreements entered into after December 31, 1995, in which the total investment exceeds forty-five million dollars within the time provided in subsection (C)(2), have the option of using may elect to use the provisions contained in of Section 4-29-67 or 4-12-30, but not both./
Amend further, page 17, by striking SECTION 7M and inserting:
/M. Section 4-12-30(B)(4)(a) of the 1976 Code, as added by Act 125 of 1995, is amended to read:
"(a) Except as provided in subsection subsections (B)(4)(b) and (D)(4)(a), the investment must be made by a single entity. For purposes of this section:
(i) any partnership or other association which properly files its South Carolina income tax returns as a partnership for South Carolina income tax purposes must be treated as a single entity and as a partnership,
(ii) any corporation or other association which properly files its South Carolina income tax returns as a corporation for South Carolina tax purposes must be treated as a single entity and as a corporation, and
(iii) any limited liability companies must be treated as a single entity."
N. Section 4-12-30(I) of the 1976 Code, as added by Act 125 of 1995, is amended to read:
"(I) Investment expenditures made or incurred by any investor in connection with a project, or relevant phase of a project in connection with a project completed and placed in service in more than one year, qualifies qualify as expenditures subject to the fee in subsection (D)(2), so long as these those expenditures are made incurred:
(1) after, or within sixty days before, the county takes action reflecting or identifying the project or proposed project or investment including, but not limited to, the adoption of an inducement or similar resolution by county council; and
(2) before the end of the applicable five- or seven-year period referenced in subsection (C)(2) and (C)(3). An inducement agreement must be executed within two years after the date on which the county takes action reflecting or identifying the project or proposed project or investment including, but not limited to, the adoption of an inducement or similar resolution by county council; otherwise, only investment expenditures made or incurred by any investor after the date of the inducement agreement in connection with a project qualifies as expenditures subject to the fee in subsection (D)(2)."
O. The amendments made in this section to Chapter 12, Title 4 of the 1976 Code are effective upon signature by the Governor. These amendments may be applied to inducement resolutions, inducement agreements, millage rate agreements, and lease agreements with regard to projects for which lease agreements have been entered into prior to the effective date of this act, if the parties to each such agreement agree to modify such agreement to provide for the application of the appropriate provisions. However, except as provided in Section 4-12-30(H) of the 1976 Code, no amendment to such agreements may reduce the millage rate or assessment ratio under such agreements./
Amend further, SECTION 8A, page 18, by striking line 17 and inserting:
/(4)(a) Except as provided in subsection subsections (B)(4)(b) and (D)(4)(a), the investment/
Amend further, SECTION 8A, page 22, by striking Section 4-29-67(D)(4), beginning on line 13, and inserting:
/(4)(a) The assessment ratio may not be lower than four percent:
(i) in the case of a business which is investing at least two hundred million dollars which, when added to the previous investments, results in a total investment of at least four hundred million dollars, and which is creating at least two hundred new full-time jobs at the site qualifying for the fee;
(ii) in the case of a business which is investing at least four hundred million dollars and which is creating at least two hundred new full-time jobs at a site qualifying for the fee; or
(iii) in the case of investments totalling at least four hundred million dollars, in a county classified as either least developed or underdeveloped, by a limited liability company and/or one or more of its members or equity holders where the member or equity holder is creating, at the site qualifying for the fee, at least one hundred new full-time jobs with an annual average salary of at least forty thousand dollars within four years of the date of execution of a millage rate agreement.
(b) The new full-time jobs requirement of this item does not apply in the case of a taxpayer which for more than the twenty-five years ending on the date of the agreement paid more than fifty percent of all property taxes actually collected in the county.
(c) In an instance in which the governing body of a county has by contractual agreement provided for a change in fee-in-lieu of taxes arrangements conditioned on a future legislative enactment, any new enactment shall not bind the original parties to the agreement unless the change is ratified by the governing body of the county.
(5) Notwithstanding the use of the term `assessment ratio', a business qualifying under items (2) or (4) of this subsection may negotiate an inducement agreement with a county using differing assessment ratios for different assessment years covered by the agreement. However, the lowest assessment ratio allowed is the lowest ratio for which the business may qualify under this section./
Amend further, SECTION 8A, page 25, by striking Section 4-29-67(I), beginning on line 5, and inserting:
"(I) Any and all Investment expenditures made or incurred by any investor in connection with a project, (or relevant phase thereof in connection with a of a project for those project projects completed and placed in service in more than one year), shall qualify as expenditures subject to the fee in subsection (D)(2), so long as such these expenditures are made incurred:
(1) after, or within sixty days before, the county takes action reflecting or identifying the project or proposed project or investment
including, but not limited to, the adoption of an inducement or similar resolution by county council; and
(2) before the end of the applicable five or seven-year period time period for investments referenced in subsection (C)(2) and (C)(3).
An inducement agreement must be executed within two years after the date on which the county takes action reflecting or identifying the project or proposed project or investment including, but not limited to, the adoption of an inducement or similar resolution by county council; otherwise, only investment expenditures made or incurred by any investor after the date of such inducement agreement in connection with a project shall qualify as expenditures subject to the fee in subsection (D)(2)./
Amend further, SECTION 8A, by striking Section 4-29-67(L)(3), page 27, beginning on line 8 and inserting:
/(3) A county or municipality or special purpose district that receives and retains revenues from a payment in lieu of taxes may use a portion of this revenue for the purposes outlined in Section 4-29-68 without the requirement of issuing special source revenue bonds or the requirements of Section 4-29-68(A)(4)./
Amend further, SECTION 8A, by striking SECTION 4-29-67(O)(1), beginning on page 27, line 34, and inserting:
/(O)(1)(a) Any corresponding interest in each of an inducement agreement, millage rate agreement, and lease agreement, and property to which the agreement relates, (collectively referred to as a `fee interest'), representing an investment of at least eighty-five million dollars (based on income tax basis without regard to depreciation, and regardless of whether such investment comprises all or part of a project), may be transferred to any other entity at any time. Notwithstanding any other provision of this chapter, any equity interest in any entity with an interest in any inducement agreement, millage rate agreement, or lease agreement may be transferred to any other entity or person at any time. by an entity to any entity, whether or not such transferee entity is a member of the same controlled group of which the transferor entity is a members, and (b) any or all equity interests, in any partnership, corporation, or other association which properly files its South Carolina income tax returns as partnership or corporation and which has an interest in an inducement agreement, millage rate agreement, and lease agreement (such equity interest collectively and individually referred to as an `entity interest') may be transferred by any entity to any entity, whether or not such transferee entity is a member of the same controlled group of which the entity in which one or more interests is being transferred is a member, provided that the entity or entities whose entity interest is or are being transferred
hold at least an eighty-five million dollar investment (based on income tax basis without regard to depreciation) in the project as of the time of the transfer./
Amend further, SECTION 8A, page 34, by striking Section 4-29-67(U), beginning on line 34, and inserting:
/(U) Notwithstanding any other provision of this section to the contrary, if at any time following the period provided in subsection (C)(2), the investment based on income tax basis without regard to depreciation falls below the eighty-five million dollar minimum investment to which the fee relates and is held by an entity or controlled group of entities, the fee provided in subsection (D)(2) is no longer available and the investor is required to make the payments which are due under Section 4-29-60 for the remainder of the lease period.
(1) Notwithstanding any other provision of this section, if an investor fails to make the minimum investment required under subsection (D)(2) within the time provided in subsection (C)(2), then if and to the extent allowed pursuant to an applicable agreement between the investor and the county, the investor is entitled to the benefits of Chapter 12 of this title. Otherwise, the fee provided in subsection (D)(2) is no longer available and the investor is required to make the payments which are due under Section 4-29-60 for the remainder of the lease period.
(2) Notwithstanding any other provision of this section, if at any time following the period provided in subsection (C)(2), the investment based income tax basis without regard to depreciation falls below the forty-five million dollar minimum investment to which the fee relates and is held by an entity or controlled group of entities, then if and to the extent allowed pursuant to any applicable agreement between the investor and the county, the investor is entitled to the benefits provided under Chapter 12 of this title. Otherwise, the fee provided in subsection (D)(2) is no longer available and the investor is required to make the payments which are due under Section 4-29-60 for the remainder of the lease period./
Amend further, page 35, by striking SECTION 8C, beginning on line 28, and inserting:
/C. The amendments to Section 4-29-67 of the 1976 Code contained in this section are effective for inducement resolutions, inducement agreements, millage rate agreements, and lease agreements with regard to projects for which lease agreements are entered into after December 31, 1995. However, the provisions affecting Section 4-29-67(B)(3), (B)(4)(b)(iii), (H), (K)(1)(c), (O), and (U) of the 1976 Code are effective for inducement resolutions, inducement agreements, millage rate
agreements, and lease agreements with regard to projects for which lease agreements have been entered into on or before December 31, 1995, if the investor and the county agree to modify the agreement to allow these provisions to apply to their agreement. However, except as provided in Section 4-29-67(H) of the 1976 Code, no amendment to an inducement agreement or millage rate agreement may reduce the millage rate, discount rate, or assessment ratio under such agreements./
Amend further, SECTION 10, beginning on page 36, by striking subsections (A) and (C) of Section 12-6-3360 and inserting:
/(A) Taxpayers that operate manufacturing, tourism, processing, warehousing, distribution, research and development, and corporate office, and qualifying service-related facilities are allowed an annual job tax credit as provided in this section. Credits under this section can may be claimed against income taxes imposed by Sections 12-6-510 or Section 12-6-530, and insurance premium taxes imposed pursuant to Chapter 7 of Title 38, and are limited in use to fifty percent of the taxpayer's South Carolina corporate income tax, or insurance premium tax liability. In computing any tax payable by a taxpayer under Section 38-7-90, the credit allowable under this section must be treated as a premium tax paid under Section 38-7-20.
(C) Subject to the conditions provided in subsection (N) of this section, a job tax credit is allowed for five years beginning in year two after the creation of the job for each new full-time job created if the minimum level of new jobs is maintained. The credit is only available to taxpayers that increase employment by ten or more full-time jobs, and no credit is allowed for the year or any subsequent year in which the net employment increase falls below the minimum level of ten. The amount of the initial job credit and the minimum level of new jobs required is as follows:
(1) One Three thousand dollars for each new full-time job created in less least developed counties. The credit is only available to taxpayers that increase employment by ten or more, and no credit is allowed for the year or any subsequent year in which the net employment increase falls below the minimum level of ten.
(2) Six Two thousand five hundred dollars for each new full-time job created in moderately under developed counties. The credit is only available to taxpayers that increase employment by eighteen or more, and no credit is allowed for the year or any subsequent year in which the net employment increase falls below the minimum level of eighteen.
(3) Three One thousand hundred dollars for each new full-time job created in moderately developed counties. The credit is only available to taxpayers that increase employment by fifty or more, and no credit is
allowed for the year or any subsequent year in which the net employment increase falls below the minimum level of fifty.
(4) Five hundred dollars for each new full-time jobs created in developed counties./
Amend further, SECTION 10A, by striking Section 12-6-3360(M)(8), (12), and (13) on pages 41 and 42, and inserting:
/(8) `Distribution facility' means an establishment where shipments of tangible personal property are processed for delivery to customers. The term does not include an establishment where retail sales of tangible personal property are made to retail customers on more than twelve days a year except for a facility which processes customer sales orders by mail, telephone, or electronic means, if the facility also processes shipments of tangible personal property to customers and if at least seventy-five percent of the dollar amount of goods sold through the facility are sold to customers outside of South Carolina.
(12) `Tourism facility' means an establishment used for a theme park; amusement park; historical, educational, or trade museum; botanical garden; cultural center; theater; motion picture production studio; convention center; arena; auditorium; or a spectator or participatory sports facility; and similar establishments where entertainment, education, or recreation is provided to the general public. Tourism facility also includes new hotel and motel construction, except that to qualify for the credits allowed by this section and regardless of the county in which the facility is located, the number of new jobs that must be created by the new hotel or motel is twenty or more. It does not include that portion of an establishment where retail merchandise or retail services are sold directly to retail customers.
(13) `Qualifying service-related facility' means (a) an establishment engaged in an activity or activities listed under the Standard Industrial Classification (SIC) Code 80 according to the Federal Office of Management and Budget Standard Industrial Classification Manual, 1987 edition; or, (b) a business for which over fifty percent of the gross receipts are from providing services, as opposed to manufacturing or selling or dealing in tangible personal property and which creates at least two hundred fifty jobs at a single location./
Amend further, page 43, SECTION 10B, by adding on line 8 /The provisions of Section 12-10-70(1)(b) of the 1976 Code, as amended by Act 231 of 1996, relating to the transferring of jobs, continue to apply for an affected project notwithstanding the repeal of Section 12-10-70 of the 1976 Code contained in this act./
Amend further, Section 12-6-3450(A), as contained in SECTION 12, page 46, line 1, by striking /, (2), and (4)/ and inserting /and (2)/ and by striking lines 21 through 30 and inserting /applicable federal facility." Amend further, SECTION 18A, beginning on page 50, by striking Section 12-10-80(A) and inserting:
/(A) Upon certification by the council to the department of the council's determination that a business is a qualifying business, a qualifying business may collect a job development fee by retaining an amount of employee withholding permitted by subsection (C) (B) or (D), or both, for the purposes permitted by subsection (B) (C) or (D), respectively. To qualify for a job development fee, a qualifying business shall create at least ten new, full-time jobs at the South Carolina facility described in the revitalization agreement. A qualifying business may collect a job development fee under the revitalization agreement for not more than fifteen years. The amount retained is the property of the business, subject to all of the conditions in this section including the later possible requirement that the funds be transferred to this State as withholding and the possible forfeiture of the funds to this State as misappropriated withholding. The retained withholding must be maintained in an escrow account with a bank which is insured by the Federal Deposit Insurance Corporation. To the extent the money is not used as permitted by subsection (B) (C) or (D), it must be treated as misappropriated employee withholding. Employee withholding may not be retained from for purposes of (B) and (C) with regard to an any employee whose job was created in this State before the entry taxable year of the qualifying business in which it enters into a revitalization agreement. If a qualifying business retains employee withholding under this section, it shall make its payroll books and records available for inspection by the council and the department at the times the council and the department request. Each qualifying business retaining employee withholding under this section shall file with the council and the department the information and documentation respecting the retention and use of the employee withholding according to the revitalization agreement. Each qualifying business which retains in excess of ten thousand dollars in any calendar year shall furnish an audited report prepared by an independent certified public accountant which itemizes the sources and uses of the funds. The audited report must be filed with the council and the department no later than June thirtieth following the calendar year of the retention. Each qualifying business retaining employee withholding under this section is allowed a credit against the withholding tax liability provided in Chapter 9 8 of this title otherwise owed to the State, the credit not to exceed the
lesser of the amount of such tax or the aggregate amount of employee withholding retained. No employer may withhold an amount that results in any employee ever receiving a smaller amount of wages on either a weekly or on an annual basis than the employee would otherwise receive in the absence of this chapter./
Amend further, Section 12-10-80(B), as contained in SECTION 18A., page 52, line 28, by striking /waiver/ and inserting /waiver of ninety-five percent/.
Amend further, SECTION 18A, page 53, by striking Section 12-10-80(C)(6), and inserting:
/(6) the amount of job development fees a qualifying business may retain for its use for qualifying expenditures is limited according to the designation of the county as defined in Section 12-6-3360 as follows:
(a) one hundred percent of the maximum job development fees may be retained by businesses located in counties designated as `least developed';
(b) eighty-five percent of the maximum job development fees may be retained by businesses located in counties designated as `under developed';
(c) seventy percent of the maximum job development fees may be retained by businesses located in counties designated as `moderately developed'; or
(d) fifty-five percent of the maximum job development fees may be retained by businesses located in counties designated as `developed'.
The council shall certify to the department the maximum job development fee for each qualifying business. After receiving certification, the department shall remit an amount equal to the difference between the maximum job development fee and the job development fee actually retained to the State Rural Infrastructure Fund as defined and provided in Section 12-10-85./
Amend further, page 56, by striking SECTION 25B, beginning on line 27, and inserting:
/B. The first unnumbered item added in Section 12-36-2120 of the 1976 Code by subsection A of this section takes effect March 1, 1996. The second unnumbered item so added takes effect on the first day of the second month following approval by the Governor./
Amend further, by adding the following new SECTIONS, appropriately numbered, to read:
/SECTION . Article 25, Chapter 6, Title 12 of the 1976 Code is amended by adding:
"Section 12-6-3490. (A) Any taxpayer claiming one or more credits under this chapter in connection with the construction, establishment, or operation of a distribution facility as defined under Section 12-6-3360(M) that invests at least fifty million dollars beginning January 1, 1996, and ending December 31, 1998, and that, within one year after the end of the year in which the facility is placed in service, creates at least two hundred new jobs and that within five years after the end of the year in which the facility is placed in service creates a total of at least four hundred new jobs, may apply any and all such credits against any state taxes, license fees, and other assessments imposed under this title. These credits may be carried forward for no more than fifteen years from the taxable year in which the credit is earned by the taxpayer. Each dollar of credit may be used only once.
(B) Subject to the limitations in this subsection, the credits earned in subsection (A) are refundable. This credit is refundable only to the extent it cannot be used against the taxpayer's tax liabilities in any given year. The total amount the taxpayer can receive during its existence as a refund under this subsection is the amount the taxpayer actually paid to the State in sales and use taxes after March 1, 1996, and on or before the tenth anniversary of the date on which the facility described in subsection (A) was placed in service.
(C) Each user of one or more of the provisions of subsection (A) or (B) may apply for and receive a sales and use tax exemption certificate and, for purposes of this section, is deemed to be the taxpayer under Chapter 36 of this title. This exemption certificate has the same effects as a resale certificate has under Section 12-36-950.
(D) Each taxpayer may utilize this section on or before meeting the minimum investment and job requirements of subsection (A) so long as the taxpayer notifies the department of its intent to do so on or before the time the taxpayer files a return utilizing this section. If the minimum investment and job requirements are not met within the time specified in subsection (A), the taxpayer is liable to the department in an amount equal to the total taxes that would have been due to the department in the absence of this section. Any such amount is subject to interest as provided in this title.
(E) For a taxpayer who meets the requirements of subsection (A), the running of the statute of limitations provided by subsections (A) through (F) of Section 12-54-85 is suspended from January 1, 1996, until ten years after the facility described in subsection (A) was placed in service."
SECTION . Section 4-29-68(A)(2) of the 1976 Code, as last amended by Act 125 of 1995, is further amended to read:
Printed Page 3350, May 29
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