2012 -- S 2604

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LC01862

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STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2012

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A N A C T

RELATING TO BUSINESSES AND PROFESSIONS -- STATE DECLARED DISASTERS

     Introduced By: Senators P Fogarty, Nesselbush, Tassoni, Maher, and Pichardo

     Date Introduced: March 01, 2012

     Referred To: Senate Corporations

It is enacted by the General Assembly as follows:

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     SECTION 1. Title 5 of the General Laws entitled "BUSINESSES AND PROFESSIONS"

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is hereby amended by adding thereto the following chapter:

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     CHAPTER 86

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FACILITATING BUSINESS-RAPID RESPONSE TO STATE DECLARED DISASTER ACT

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OF 2012

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     5-86-1. Short title. – This act shall be known and may be cited as the “Facilitating

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Business Rapid Response to State Declared Disasters Act of 2012.”

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     5-86-2. Legislative findings. – (a) During times of storm, flood, fire, earthquake,

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hurricane or other disaster or emergency, many companies bring in resources and personnel from

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other states throughout the U.S. on a temporary basis to expedite the often enormous and

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overwhelming task of cleaning up, restoring and repairing damaged buildings, equipment and

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property or even deploying or building replacement facilities in the state;

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     (b) This may involve the need for out-of-state companies, including out-of-state affiliates

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of companies based in the state to bring in resources, property and/or personnel that previously

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have had no connection to the state, to perform activity in the state including, but not limited to,

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repairing, renovating, installing, building, rendering services or other business activities and for

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which personnel may be located in the state for extended periods of time to perform such

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activities;

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     (c) During such time of operating in the state on a temporary basis solely for purposes of

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helping the state recover from the disaster or emergency, these companies and individual

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employees should not be burdened by any requirements for business and employee taxes as a

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result of such activities in the state for a temporary period;

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     (d) The state’s nexus and residency thresholds are intended for businesses and individuals

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in the state as part of the conduct of regular business operations or who intend to reside in the

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state and should not be directed at companies and individuals coming into the state on a

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temporary basis to provide assistance in response to a declared state disaster or emergency; and

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     (e) To ensure that companies may focus on quick response to the needs of the state and

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its citizens during a declared state disaster or emergency it is appropriate for the legislature to

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deem that such activity, for a reasonable period of time during and after the disaster or emergency

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for repairing and restoration of the often devastating damage to property and infrastructure in the

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state, shall not establish presence, residency, nor doing business in the state nor any other criteria

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for purposes of state and local taxes, licensing and regulatory requirements.

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     5-86-3. Definitions. – As used in this chapter, the following terms shall have the

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following meanings:

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     (1) “Registered business in the state” (or “registered business”) means a business entity

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that is currently registered to do business in the state prior to the declared state disaster or

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emergency.

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     (2) “Out-of-state business” means a business entity that has no presence in the state and

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conducts no business in the state whose services are requested by a registered business or by a

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state or local government for purposes of performing disaster or emergency-related work in the

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state. This shall also include a business entity that is affiliated with the registered business in the

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state solely through common ownership. The “out-of-state business” has no registrations or tax

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filings or nexus in the state prior to the declared state disaster or emergency.

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     (3) “Out-of-state employee” means this legislation an employee of an out-of-state

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business who does not work in the state.

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     (4) “Disaster or emergency-related work” means repairing, renovating, installing,

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building, rendering services or other business activities that relate to infrastructure that has been

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damaged impaired or destroyed by the declared state disaster or emergency.

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     (5) “Infrastructure” means property and equipment owned or used by communications

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networks, gas and electric distribution systems, water pipelines, and public roads and bridges and

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related support facilities that services multiple customers or citizens including, but not limited to,

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real and personal property such as buildings, offices, lines, poles, pipes, structures and equipment.

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     (6) “Declared state disaster or emergency” means a disaster or emergency event for

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which a governor’s state of emergency proclamation has been issued or for which a presidential

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declaration of a federal major disaster or emergency has been issued.

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     (7) “Disaster period” means a period that begins within ten (10) days of the first day of

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the governor’s proclamation or the president’s declaration (whichever occurs first) and that

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extends for a period of sixty (60) calendar days after the end of the declared disaster or

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emergency period.

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     5-86-4. Obligations, rights and duties. – (a) An out-of-state business that conducts

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operations within the state for purposes of performing work or services related to a declared state

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disaster or emergency during the disaster period shall not be considered to have established a

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level of presence that would require that business to register, file and remit state or local taxes or

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that would require that business or its out-of-state employees to be subject to any state licensing

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or registration requirements. This includes any and all state or local business licensing or

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registration requirements or state and local taxes or fees such as unemployment insurance, state or

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local occupational licensing fees and sales and use tax on equipment used or consumed during the

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disaster period, public service commission or secretary of state licensing and regulatory

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requirements.

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     (b) Any out-of-state employee as defined herein shall not be considered to have

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established residency or a presence in the state that would require that person or that person’s

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employer to file and pay income taxes or to be subjected to income tax withholdings or to file and

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pay any other state or local tax or fee during the Disaster Period. This includes any related state or

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local employer withholding and remittance obligations.

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     (c) Out-of-state businesses and out-of-state employees shall be required to pay

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transaction taxes and fees including, but not limited to, fuel taxes or sales/use taxes on materials

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or services subject to sales/use tax, hotel taxes, car rental taxes or fees that the out-of-state

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affiliated business or out-of-state employee purchases for use or consumption in the state during

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the disaster period, unless such taxes are otherwise exempted during a disaster period.

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     (d) any out-of- state business or out-of-state employee that remains in the state after the

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disaster period will become subject to the state’s normal standards for establishing presence,

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residency or doing business in the state and will therefore become responsible for any business or

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employee tax requirements that ensue.

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     5-86-5. Administration. – (a) Notification of out-of-state business during disaster period.

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     (1) The out-of-state business that enters the state shall provide notification as soon as is

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practicable after the declared disaster or emergency to the Rhode Island emergency agency that it

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is in the state for purposes of responding to the disaster or emergency. Information to be provided

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to such agency shall include the name, state of domicile, its principal business address, its federal

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tax identification number, the date that the business entered the state, and contact information.

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     (2) A registered business in the state shall provide the information required in subdivision

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(1) of this section for any affiliate that enters the state that is an out-of-state business. The

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notification shall also include contact information for the registered business in the state.

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     (b) Notification of intent to remain in state. an out-of-state business or an employee that

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remains in the state after the disaster period must report this information to the Rhode Island

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emergency agency and proceed to complete all state and local registration, licensing and filing

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requirements that ensue as a result of establishing the requisite business presence or residency in

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the state.

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     (c) Procedures. The emergency management agency shall promulgate necessary

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regulations, develop and issue forms or online processes to carry out these administrative

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procedures.

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     SECTION 2. This act shall take effect upon passage.

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LC01862

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N A C T

RELATING TO BUSINESSES AND PROFESSIONS -- STATE DECLARED DISASTERS

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     This act would provide thresholds for establishing presence, residency or doing business

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in the state for out-of-state employees and companies including affiliates of in-state companies

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that temporarily provide resources and personnel in the state during a state of emergency declared

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by either the governor or the president of the United States.

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     This act would take effect upon passage.

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LC01862

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