2012 -- S 2120

=======

LC00056

=======

STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2012

____________

A N A C T

RELATING TO TAXATION - EXEMPTIONS FOR ARTISTS - TIVERTON

     Introduced By: Senators DiPalma, and Felag

     Date Introduced: January 18, 2012

     Referred To: Senate Finance

It is enacted by the General Assembly as follows:

1-1

     SECTION 1. Section 44-18-30.0 of the General Laws in Chapter 44-18 entitled "Sales

1-2

and Use Taxes - Liability and Computation" is hereby amended to read as follows:

1-3

     44-18-30.B. Exemption from sales tax for sales by writers, composers, artists --

1-4

Findings. -- (a) The general assembly makes the following findings of facts:

1-5

      (1) The downtown area of the city of Providence has been characterized by blighted

1-6

areas, and dilapidated and abandoned structures;

1-7

      (2) As a result, the downtown area has been designated an economic development zone

1-8

in order to stop the deterioration and stimulate economic activity;

1-9

      (3) The capitol center area of the city of Providence has become an attractive location,

1-10

especially with the construction of the Providence Place Mall;

1-11

      (4) In order to promote, revitalize and redevelop the "Old Downtown" area of the city of

1-12

Providence it is necessary to provide tax exemptions to this area as it has been designated as an

1-13

economic development zone;

1-14

      (5) In order to promote, revitalize, and redevelop the "Downtown or other industrial or

1-15

manufacturing buildings" located in the City of Pawtucket, it is necessary to provide tax

1-16

exemptions to this area as it has been designated as an economic development zone;

1-17

      (6) The development of an active artistic community, including "artists in residence", in

1-18

this area would promote economic development, revitalization, tourism, employment

1-19

opportunities, and encourage business development by providing alternative commercial

1-20

enterprises while in Providence creating a link between the Old Downtown and the Capital Center

2-1

Area;

2-2

      (7) There is a separate artistic community in the town of Westerly which is important to

2-3

preserve, promote, and revitalize, and which is distinct from that in the city of Providence;

2-4

      (8) There is a separate artistic community in the city of Woonsocket which is important

2-5

to promote and revitalize and which is distinct from that in the cities of Providence and Pawtucket

2-6

and the town of Westerly;

2-7

      (9) There is a separate artistic community in the city of Warwick which is important to

2-8

preserve, promote, and revitalize and which is distinct from that in the cities of Providence,

2-9

Pawtucket, Woonsocket and the town of Westerly;

2-10

      (10) There are separate artistic communities in the city of Newport and in the town of

2-11

Tiverton which are important to promote and revitalize and which are distinct from those in the

2-12

cities of Providence, Pawtucket, Warwick and Woonsocket and the towns of Westerly and Little

2-13

Compton;

2-14

      (11) There is a separate artistic community in the town of Warren which is important to

2-15

promote and revitalize and which is distinct from that in the cities of Providence, Pawtucket,

2-16

Newport, Warwick and Woonsocket and the towns of Westerly and Tiverton.

2-17

      (b) (1) This section only applies to sales by writers, composers and artists residing in and

2-18

conducting a business within a section of the defined economic development zone in the cities of

2-19

Providence or Pawtucket, or the defined economic development zone in the town of Westerly or

2-20

the defined economic zone in the city of Woonsocket, or the defined economic zone in the city of

2-21

Warwick, or in those areas within the city of Newport, and the town of Little Compton, which are

2-22

zoned "general business," "waterfront business," or "limited business" or have been designated

2-23

by the city of Newport as part of the arts district, or in those areas of the town of Warren which

2-24

are zoned "waterfront district," "special district," "village business district," "manufacturing

2-25

district," "business district" or "Warren historic district," or in those areas of the town of Tiverton

2-26

which are zoned "business commercial," "business waterfront" or "village commercial." or in that

2-27

area of the town of Tiverton which is zoned "Residential R-80" and is bounded by the

2-28

Bulgarmarsh Road to the north, Cornell Road to the west, King Road to the south, and Crandall

2-29

Road to the east. For the purposes of this section, a "work" means an original and creative work,

2-30

whether written, composed or executed for "one-of-a-kind limited" production and which falls

2-31

into one of the following categories:

2-32

      (i) A book or other writing;

2-33

      (ii) A play or the performance of said play;

3-34

      (iii) A musical composition or the performance of said composition;

3-35

      (iv) A painting or other like picture;

3-36

      (v) A sculpture;

3-37

      (vi) Traditional and fine crafts;

3-38

      (vii) The creation of a film or the acting within the film;

3-39

      (viii) The creation of a dance or the performance of the dance.

3-40

      (2) For the purposes of this section, a "work" includes any product generated as a result

3-41

of any of the above categories.

3-42

      (3) For the purposes of this section, a "work" does not apply to any piece or performance

3-43

created or executed for industry oriented or related production.

3-44

      (c) (1) This section applies to sales by any individual:

3-45

      (i) Who is a resident of and has a principal place of business situated in the section of the

3-46

economic development zone designated as the arts and entertainment district in the downtown

3-47

area of the city of Providence or in the city of Pawtucket, or the defined economic development

3-48

zone in the town of Westerly or the defined economic zone in the city of Woonsocket, or the

3-49

defined economic zone in the city of Warwick, or who is a resident of and has a principal place of

3-50

business situated in those areas within the city of Newport or the town of Little Compton, which

3-51

are zoned "general business," "waterfront business," or "limited business," or have been

3-52

designated by the city of Newport as part of the arts district, or who is a resident of and has a

3-53

principal place of business situated in those areas within the town of Warren which are zoned

3-54

"waterfront district," "special district," "village business district," "manufacturing district,"

3-55

"business district" or "Warren historic district," or who is a resident or has a principal place of

3-56

business situated in those areas within the town of Tiverton which are zoned "business

3-57

commercial," "business waterfront" or "village commercial." or in that area of the town of

3-58

Tiverton which is zoned "Residential R-80" and is bounded by the Bulgarmarsh Road to the

3-59

north, Cornell Road to the west, King Road to the south, and Crandall Road to the east. For the

3-60

purposes of this section, the Providence arts and entertainment district in Providence is defined as

3-61

the area bounded by Pine Street to the southeast, Dorrance Street to the northeast, Sabin Street to

3-62

the northwest and Empire Street to the southwest. Said Providence arts and entertainment district

3-63

also includes the area beginning at the point of intersection of Acorn Street and Harris Avenue,

3-64

then turning east onto Atwells Avenue to Service Road 7, then turning southerly onto Service

3-65

Road 7 to Westminster Street, then turning westerly onto Westminster Street, continuing until

3-66

Bridgham, then turning south onto Bridgham to Cranston Street, then turning southwesterly onto

3-67

Cranston Street, then continuing to Messer Street, then turning north onto Messer Street to

3-68

Westminster Street, turning west onto Westminster Street to US Hwy 6 off ramp, then heading

4-1

west on US Hwy 6 to Sheridan Street, then heading northeast on Sheridan Street to Aleppo Street,

4-2

then turning southeast along Aleppo Street to Pelham Street, then heading northeast on Pelham

4-3

Street to Manton Avenue, then continuing southeast on Manton Avenue until Delaine Street, then

4-4

heading northeast on Delaine Street until Appleton Street, then continuing northwesterly on

4-5

Appleton Street until Bowdoin Street, then heading north on Bowdoin Street until Barstow Street,

4-6

then heading east on Barstow until Valley Street, then heading northeast on Valley Street to

4-7

Hemlock Street, then turning southeast on Hemlock Street until Promenade Street, then heading

4-8

east on Promenade Street to Acorn Street, then heading south on Acorn Street to the intersection

4-9

of Acorn Street and Harris Avenue. The named streets are included in the Providence district; and

4-10

in Pawtucket is defined as the area beginning at the point of intersection of Dexter Street and the

4-11

Central Falls line, then east along the Central Falls line to the Blackstone River, then north along

4-12

the city boundary on the Blackstone River to the Cumberland line, then west along the Pawtucket

4-13

city boundary line to I-95, then south along I-95 to Pine Street, then north on Pine Street to

4-14

AMTRAK Right of Way, then northwest along the AMTRAK Right of Way to Dexter Street,

4-15

then north on Dexter Street to the Central Falls line. The named streets are included in the district.

4-16

The Westerly arts and entertainment district is defined as assessor's plat 56, lots 1 through 24, lot

4-17

48, lots 50 through 62, and lots 71 through 82, and assessors plat 66, lots 22 through 26, and lots

4-18

29 through 36 the Woonsocket arts and entertainment district is defined as the area beginning at a

4-19

point of land on the southwest bank of the Blackstone River abutting the bridge for the

4-20

Providence & Worcester Railroad and proceeding northerly to a point at the intersection of

4-21

Worrall Street, Clinton Street and Harry S. Truman Drive, then proceeding northwesterly along

4-22

Worrall Street to its intersection with Social Street, then turning westerly on Social Street

4-23

proceeding to its intersection with Main Street, Blackstone Street and North Main Street, then

4-24

turning northwesterly and proceeding along Blackstone Street to its intersection with River Street,

4-25

then turning northerly and proceeding along River Street to its intersection with the north/east

4-26

bank of Blackstone River, then following the riverbank southerly to the bridge at Bernon Street

4-27

and turning easterly crossing the Blackstone River via Bernon Street and proceeding to its

4-28

intersection with Front Street, then turning northeasterly on Front Street and proceeding to its

4-29

intersection with Hamlet Avenue, and to include the former courthouse on the southerly side of

4-30

Front Street at its intersection with Hamlet Avenue, then turning easterly on Hamlet Avenue and

4-31

proceeding to its intersection with Manville Road, then turning southeasterly on Manville Road

4-32

and proceeding to its intersection with Davison Avenue, then turning northeasterly on Davison

4-33

Avenue and proceeding to a point on the south/west bank of the Blackstone River, then turning

4-34

northerly, following the southerly riverbank to the point of beginning. The abovementioned

5-1

streets are included in the district. The Warwick arts district is defined as that area known as

5-2

Pontiac Village, beginning on Route 5 at the Warwick/Cranston municipal boundary, then south

5-3

to the intersection of Route 5 and the Pawtuxet River, then following the Pawtuxet River in an

5-4

easterly and northerly direction to the municipal boundary in the vicinity of Knight Street, then

5-5

from the intersection of Knight Street and the municipal boundary westerly along the

5-6

Warwick/Cranston municipal boundary to the intersection of Route 5 and Greenwich Avenue.

5-7

The above named streets are included in the district.

5-8

      (ii) Who is determined by the tax administrator, after consideration of any evidence he or

5-9

she deems necessary or which is submitted to him or her by the individual, to have written,

5-10

composed, or executed, either solely or jointly, a work or works which would fall into one of the

5-11

categories listed in subsection (b)(1).

5-12

      (2) This section also applies to sales by any other gallery located in the arts and

5-13

entertainment district described in subsection (c)(1)(i) as well as any other arts and entertainment

5-14

district designated by the general assembly, as well as to sales by any other gallery located in

5-15

those areas within the city of Newport, or the town of Little Compton, which are zoned "general

5-16

business," "waterfront business," or "limited business" or have been designated by the city of

5-17

Newport as part of the arts district, as well as to sales by any other gallery located in those areas

5-18

within the town of Warren which are zoned "waterfront district," "special district," "village

5-19

business district," "manufacturing district," "business district" or "Warren historic district," as

5-20

well as to sales by any other gallery located in those areas within the town of Tiverton which are

5-21

zoned "business commercial," "business waterfront" or "village commercial." or in that area of

5-22

the town of Tiverton which is zoned "Residential R-80" and is bounded by the Bulgarmarsh Road

5-23

to the north, Cornell Road to the west, King Road to the south, and Crandall Road to the east.

5-24

      (3) The tax administrator shall not make a determination unless:

5-25

      (i) The individual(s) concerned duly make(s) an application to the tax administrator for

5-26

the sales tax exemption which applies to the works defined in this section; and

5-27

      (ii) The individual has complied and continues to comply with any and all requests made

5-28

by the tax administrator.

5-29

      (d) Any individual to whom this section applies and who makes an application to the tax

5-30

administrator is entitled to a sales tax exemption for the sale of a work or works sold from the

5-31

individual's business located in the economic development zone which would, apart from this

5-32

section, be subject to the tax rate imposed by the state of Rhode Island.

5-33

      (e) When an individual makes a request for the exemption, the tax administrator is

5-34

entitled to all books, documents, or other evidence relating to the publication, production or

6-1

creation of the works that may be deemed necessary by the tax administrator for the purposes of

6-2

the exemption. The time period in which to provide this information is in the sole discretion of

6-3

the tax administrator and specified in the notice.

6-4

      (f) In addition to the information required in subsection (e), the tax administrator may

6-5

require the individual(s) to submit an annual certified accounting of the numbers of works sold,

6-6

the type of work sold, and the date of the sale. Failure to file this report may, in the sole discretion

6-7

of the tax administrator, terminate the individual's eligibility for the exemption.

6-8

      (g) Any person storing, using, or otherwise consuming in this state any work or works

6-9

which is deemed to be exempt from the sales tax pursuant to this section is not liable for the use

6-10

tax on the work or works.

6-11

      (h) Notwithstanding the provisions of this section, any individual to whom this section

6-12

may apply shall comply with all the administration, collection, and other provisions of chapters

6-13

18 and 19 of this title.

6-14

     SECTION 2. Section 44-30-1.1 of the General Laws in Chapter 44-30 entitled "Personal

6-15

Income Tax" is hereby amended to read as follows:

6-16

     44-30-1.1. Exemption from tax for writers, composers and artists. -- (a) This section

6-17

shall only apply to writers, composers and artists residing within a section of the defined

6-18

economic development zone within the city of Providence, Pawtucket, Woonsocket or Warwick,

6-19

or the economic development zone within the town of Westerly as defined in section 44-18-

6-20

30B(c)(1)(i), or within the city of Newport or within the town of Tiverton or the town of Little

6-21

Compton, or within those areas of the town of Warren which are zoned "waterfront district,"

6-22

"special district," "village business district," "manufacturing district," "business district" or

6-23

"Warren historic district", or a tax pass-through entity wholly owned by one or more such

6-24

individuals and who create such work while residing in the zone, or in the case of Newport or the

6-25

town of Little Compton, within those areas of the city or town which are zoned "general

6-26

business," "waterfront business" or "limited business" or have been designated by the city of

6-27

Newport as part of the arts district, or in the case of Warren, within those areas of the town which

6-28

are zoned "waterfront district," "special district," "village business district," "manufacturing

6-29

district," "business district" or "Warren historic district," or in the case of Tiverton with those

6-30

areas of the town which are zoned "business commercial," "business waterfront" or "village

6-31

commercial." or in that area of the town of Tiverton which is zoned "Residential R-80" and is

6-32

bounded by the Bulgarmarsh Road to the north, Cornell Road to the west, King Road to the south,

6-33

and Crandall Road to the east. For the purposes of this section, a "work" means an original and

6-34

creative work, whether written, composed, created or executed for "one-of-a-kind, limited"

7-1

production, before or after the passing of this section, which falls into one of the following

7-2

categories: (1) a book or other writing; (2) a play or the performance of said play; (3) a musical

7-3

composition or the performance of said composition; (4) a painting or other like picture; (5) a

7-4

sculpture; (6) traditional and fine crafts; (7) the creation of a film or the acting of said film; (8)

7-5

the creation of a dance or the performance of said dance. For purposes of this section, a "work"

7-6

does not apply to any piece or performance created or executed for industry oriented or related

7-7

production.

7-8

      (b) (1) This section shall apply to any individual:

7-9

      (i) Who is a resident within the section of the economic development zone designated as

7-10

the arts and entertainment district in the downtown areas of the cities of Providence, Woonsocket

7-11

or Pawtucket, and deriving the income exempted from within said district while a resident of said

7-12

zone, or who is a resident within the section of the arts and entertainment district in the town of

7-13

Westerly, as defined in section 44-18-30B(c)(1)(i) and who derives the income exempted from

7-14

within said district while a resident of said zone. For the purposes of this section, the "Providence

7-15

arts and entertainment district" is defined as the area bounded by Pine Street to the southeast,

7-16

Dorrance Street to the northeast, Sabin Street to the northwest and Empire Street to the southwest.

7-17

Said Providence arts and entertainment district also includes the area beginning at the point of

7-18

intersection of Acorn Street and Harris Avenue, then turning east onto Atwells Avenue to Service

7-19

Road 7, then turning southerly onto Service Road 7 to Westminster Street, then turning westerly

7-20

onto Westminster Street, continuing until Bridgham, then turning south onto Bridgham to

7-21

Cranston Street, then turning southwesterly onto Cranston Street, then continuing to Messer

7-22

Street, then turning north onto Messer Street to Westminster Street, turning west onto

7-23

Westminster Street to US Hwy 6 off ramp, then heading west on US Hwy 6 to Sheridan Street,

7-24

then heading northeast on Sheridan Street to Aleppo Street, then turning southeast along Aleppo

7-25

Street to Pelham Street, then heading northeast on Pelham Street to Manton Avenue, then

7-26

continuing southeast on Manton Avenue until Delaine Street, then heading northeast on Delaine

7-27

Street until Appleton Street, then continuing northwesterly on Appleton Street until Bowdoin

7-28

Street, then heading north on Bowdoin Street until Barstow Street, then heading east on Barstow

7-29

until Valley Street, then heading northeast on Valley Street to Hemlock Street, then turning

7-30

southeast on Hemlock Street until Promenade Street, then heading east on Promenade Street to

7-31

Acorn Street, then heading south on Acorn Street to the intersection of Acorn Street and Harris

7-32

Avenue. The abovementioned streets shall be included in the district. The "Westerly arts and

7-33

entertainment district" is defined in section 44-18-30B(c)(1)(i). The "Pawtucket arts and

7-34

entertainment district" shall be defined as the area beginning at the point of intersection of Dexter

8-1

Street and the Central Falls line, then east along the Central Falls Line to the Blackstone River,

8-2

then north along the city boundary on the Blackstone River to the Cumberland line, then west

8-3

along the Pawtucket city boundary line to I-95, then south along I-95 to Pine Street, then north on

8-4

Pine Street to AMTRAK Right of Way, then northwest along the AMTRAK Right of Way to

8-5

Dexter Street, then north on Dexter Street to the Central Falls line. The abovementioned streets

8-6

shall be included in the district. The "Woonsocket arts and entertainment district" shall be defined

8-7

as the area beginning at a point of land on the southwest bank of the Blackstone River abutting

8-8

the bridge for the Providence & Worcester Railroad and proceeding northerly to a point at the

8-9

intersection of Worrall Street, Clinton Street and Harry S. Truman Drive, then proceeding

8-10

northwesterly along Worrall Street to its intersection with Social Street, then turning westerly on

8-11

Social Street proceeding to its intersection with Main Street, Blackstone Street and North Main

8-12

Street, then turning northwesterly and proceeding along Blackstone Street to its intersection with

8-13

River Street, then turning northerly and proceeding along River Street to its intersection with the

8-14

northeast bank of Blackstone River, then following the riverbank southerly to the bridge at

8-15

Bernon Street and turning easterly crossing the Blackstone River via Bernon Street and

8-16

proceeding to its intersection with Front Street, then turning northeasterly on Front Street and

8-17

proceeding to its intersection with Hamlet Avenue, and to include the former Courthouse on the

8-18

southerly side of Front Street at its intersection with Hamlet Avenue, then turning easterly on

8-19

Hamlet Avenue and proceeding to its intersection with Manville Road, then turning southeasterly

8-20

on Manville Road and proceeding to its intersection with Davison Avenue, then turning

8-21

northeasterly on Davison Avenue and proceeding to a point on the southwest bank of the

8-22

Blackstone River, then turning northerly, following the southerly riverbank to the point of

8-23

beginning. The abovementioned streets are included in the district. The Warwick arts district is

8-24

defined as that area known as Pontiac Village, beginning on Route 5 at the Warwick/Cranston

8-25

municipal boundary, then south to the intersection of Route 5 and the Pawtuxet River, then

8-26

following the Pawtuxet River in an easterly and northerly direction to the municipal boundary in

8-27

the vicinity of Knight Street, then from the intersection of Knight Street and the municipal

8-28

boundary westerly along the Warwick/Cranston municipal boundary to the intersection of Route

8-29

5 and Greenwich Avenue. The above named streets are included in the district.

8-30

      This section shall also apply to any individual who is a resident of the city of Newport or

8-31

the town of Tiverton or the town of Little Compton and whose income otherwise qualifies for an

8-32

exemption as provided for in this section.

8-33

      This section shall also apply to any individual who is a resident of the town of Warren

8-34

and whose income otherwise qualifies for an exemption as provided for in this section.

9-1

      (ii) Who is determined by the tax administrator, after consideration of any evidence in

9-2

relation to the matter which the individual submits to him or her and after such consultation as

9-3

may seem to him or her to be necessary with such person or body of persons as in his or her

9-4

opinion may be of assistance to him or her, to have written, composed or executed either solely or

9-5

jointly with another individual, a work or works that would fall into one of the categories listed in

9-6

subsection (a) of this section.

9-7

      (c) (1) An individual to whom this section applies and who duly makes a claim to the tax

9-8

administrator in that behalf shall, subject to subdivision (2) of this subsection, be entitled to have

9-9

the profits or gains arising to him or her from the publication, production or sale of a work or

9-10

works in relation to which the tax administrator has made a determination under paragraph

9-11

(b)(1)(ii) of this section to be taken as a modification reducing federal adjusted gross income.

9-12

      (2) The modification authorized by this section shall apply to the year in which the profit

9-13

or gain from the publication, production or sale of a work is realized.

9-14

      (d) The tax administrator may serve on an individual who makes a claim under this

9-15

subsection a notice or notices, in writing, requiring him or her to make available within any time

9-16

that may be specified in the notice of all such books, accounts and documents in his or her

9-17

possession or power as may be requested, being books, accounts and documents relating to the

9-18

publication, production or sale of the work in respect of the profits or gains of which exemption is

9-19

claimed.

9-20

      (e) For the purpose of determining the amount of profits or gains subject to modification

9-21

under this section, the tax administrator may make any apportionment of receipts and expenses

9-22

that may be necessary.

9-23

      (f) Notwithstanding any other provisions of this chapter, any individual seeking relief

9-24

under this section shall file a Rhode Island personal income tax return listing the modification

9-25

reducing federal adjusted gross income relating to profits or gains realized from the works as

9-26

defined in this section.

9-27

     SECTION 3. This act shall take effect upon passage.

=======

LC00056

========

EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N A C T

RELATING TO TAXATION - EXEMPTIONS FOR ARTISTS - TIVERTON

***

10-1

     This act would add an area located in the Town of Tiverton to the tax exempt artistic

10-2

communities.

10-3

     This act would take effect upon passage.

=======

LC00056

=======