Governor, Economic Development

Rule R357-6

Technology and Life Science Economic Development and Related Tax Credits

Notice of Proposed Rule

(Amendment)

DAR File No.: 36749
Filed: 09/11/2012 03:18:27 PM

RULE ANALYSIS

Purpose of the rule or reason for the change:

The statute was amended, thus requiring a rule change.

Summary of the rule or change:

These changes: remove capital gains tax credit language and add quarterly application deadlines.

State statutory or constitutional authorization for this rule:

• Section 63M-1-2908

Anticipated cost or savings to:

the state budget:

None--This is an amendment to a program which is currently being administered by the Governor's Office of Economic Development. The changes in the rule will not create nor save costs to the existing program.

local governments:

None--Local government is not involved in this program and would not be affected by the change.

small businesses:

None--Small businesses which were previously eligible for the tax credits continue to be eligible. There is no fiscal impact on small businesses.

persons other than small businesses, businesses, or local governmental entities:

None--There is no application fee for the tax credits and the application is similar to what was required in the past.

Compliance costs for affected persons:

None--There is no application fee for the tax credits and the application is similar to what was required in the past.

Comments by the department head on the fiscal impact the rule may have on businesses:

None--There is no fiscal impact on small businesses.

Spencer P. Eccles, Executive Director

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Governor
Economic Development
60 E SOUTH TEMPLE 3RD FLR
SALT LAKE CITY, UT 84111

Direct questions regarding this rule to:

• Zachary Derr at the above address, by phone at 801-538-8746, by FAX at 801-538-8888, or by Internet E-mail at zderr@utah.gov

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

10/31/2012

This rule may become effective on:

11/10/2012

Authorized by:

Spencer Eccles, Executive Director

R357. Governor, Economic Development.

R357-6. Technology and Life Science Economic Development and Related Tax Credits.

R357-6-1. Purpose.

(1) The purpose of these rules is to provide:

(a) the criteria upon which the Governor's Office of Economic Development will determine whether to award tax credits to applicants;

(b) the procedures for documenting the Governor's Office of Economic Development's application of this criteria;

(c) the procedures by which the Governor's Office of Economic Development issues tax credit certificates;

(d) the available tax credits for which applicants may apply.

 

R357-6-2. Authority.

(1) UCA 63M-1-2907 requires the office to make rules establishing criteria to prioritize the issuance of tax credits among applicants and to establish procedures for documenting the office's application of the criteria.

 

R357-6-3. Definitions.

(1) Terms in these rules are used as defined in UCA 63M-1-2902.

 

R357-6-4. Conditions.

(1) Applicants shall use the application form provided by the office and follow the procedures and requirements set forth in UCA 63M-1-2905 for obtaining a tax credit certificate.

(2) Applicants shall submit the application form to the office to be eligible to receive a tax credit, quarterly throughout the fiscal year as set forth in UCA 63M-1-2908, on or before the following quarterly deadlines:

(a) September 1; and

(b) December 1; and

(c) March 1; and

(d) June 1.

[(2)](3) The office shall review and rank for approval accepted applications based upon the following criteria:

(a) The overall economic impact on the state related to providing tax credits, taking into account such factors as:

(i) the number of new incremental jobs to Utah; or

(ii) capital investment in the state; or

(iii) new state revenues; or

(iv) any combination of Subsections (i), (ii), or (iii); or

(v) other criteria as established by the office by policy publication.

[(3)](4) The office shall keep a record of the review and ranking of applications based on the criteria in subsection (2).

[(4)](5) The office, with advice from the board, may enter into an agreement with a business entity authorizing a tax credit if the business entity meets the standards under subsections (2) and (3) and according to the requirements and procedures set forth in UCA 63M-1-2909.

[(5)](6) A business entity is eligible for an economic development tax credit only if the office has entered into an agreement under subsection (4) with the business entity.

 

R357-6-5. Available Tax Credits.

(1) An applicant may seek one of three types of tax credits, drawn from funds expressly set aside by the Legislature:

(a) a refundable tax credit for generating state tax revenue; or

(b) a non-refundable tax credit for investment in certain life sciences establishments[; or].

[ (c) a non-refundable tax credit for capital gains transactions related to a life sciences establishment.

] (2) Eligibility shall be determined by:

(a) statutory requirements; and

(b) policy established by the office, with advice and consent of the board, which shall be posted on the office's public website; and

(c) the criteria listed in R357-6-4(2).

 

KEY: economic development, life sciences, new state revenue

Date of Enactment or Last Substantive Amendment: [August 8, 2011]2012

Authorizing, and Implemented or Interpreted Law: 63M-1-2901