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art.012/1

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     ARTICLE 12

RELATING TO ECONOMIC DEVELOPMENT

     SECTION 1. Section 42-64.10-6 of the General Laws in Chapter 42-64.10 entitled

"Quonset Development Corporation" is hereby amended to read as follows:

     42-64.10-6. Additional general powers and duties.

     In addition to the powers enumerated in § 42-64.10-5, except to the extent inconsistent

with any specific provision of this chapter, the corporation shall have and may exercise additional

general powers:

     (a) As set forth in § 42-64-7 necessary or convenient to effect its purposes; provided,

however, that the corporation shall not have the power to issue bonds or notes or exercise eminent

domain;

     (b) As a subsidiary of the Rhode Island commerce corporation as provided for in § 42-64-

7.1;

     (c) As the Rhode Island commerce corporation's true and lawful attorney as agent and

attorney-in-fact and in the name, place and stead of the Rhode Island commerce corporation with

respect to all property of the Rhode Island commerce corporation at Quonset Business Park

(hereinafter referred to as "the Property") and for the purposes hereinafter set forth:

     (1) To ask, demand, recover, collect, receive, hold, and possess all sums of money, debts,

dues, goods, wares, merchandise, chattels, effects, bonds, notes, checks, drafts, accounts, deposits,

safe deposit boxes, interests, dividends, stock certificates, certificates of deposit, insurance benefits

and proceeds, documents of title, personal and real property, tangible and intangible property, and

property rights, liquidated or unliquidated, that now are, or hereafter, shall be, or become, due,

owing, or payable in respect to the property, and upon receipt thereof, or of any part thereof, to

make, sign, execute, and deliver such receipts, releases, or other discharges for the same as the

corporation shall deem proper.

     (2) To lease, purchase, exchange and acquire, and to bargain, contract, and agree for the

lease, purchase, exchange, and acquisition of, and to take, receive, possess, and manage any real or

personal property related in any way to the property, tangible and intangible, or any interest therein.

     (3) To enter into and upon all and each of the real properties constituting a part of, or related

in any way, to the property, and to let, manage, and improve the real property or any part thereof,

and to repair or otherwise improve or alter, and to insure any buildings or structures thereon.

     (4) To market and sell, either at public or private sale, or exchange any part or parts of the

real or personal properties, including indebtedness or evidence thereof, constituting a part of or

related in any way to the property, including sales on credit, and for that purpose to execute and

receive all promissory notes, bonds, mortgages, deeds of trust, security agreements, and other

instruments that may be necessary or proper, and to bargain, contract, and agree with respect to the

sale or exchange of such properties; and to execute and deliver good and sufficient deeds, bills of

sale, assignments, or other instruments or endorsements for the conveyance or transfer of the same;

and to give receipts for all or any part of the purchase price or other consideration.

     (5) To sign, endorse, execute, acknowledge, deliver, receive, and possess such applications,

contracts, agreements, options, covenants, deeds, conveyances, trust deeds, mortgagees deeds,

security agreements, bills of sale, leases, mortgages, assignments, insurance policies, bills of lading,

warehouse receipts, documents of title, bills, bonds, debentures, checks, drafts, bills of exchange,

notes, stock certificates, proxies, warrants, commercial paper, receipts, withdrawal receipts, and

deposit instruments relating to accounts or deposits in, or certificates of deposit of, banks, savings

and loan or other institutions or associations, proofs of loss, evidences of debts, releases, and

satisfactions of mortgages, judgments, liens, security agreements, and other debts and obligations,

and other instruments in writing of whatever kind and nature as be necessary or proper in the

exercise of the rights and powers herein granted.

     (6) To enter into subordination agreements, inter-creditor agreements, reinstatement

agreements, "stand still" and "stand-by" agreements, modification agreements, forbearance

agreements, and other contracts having the effect of subordinating, modifying, renewing,

restructuring or otherwise altering the rights, obligations, or liabilities of the commerce corporation,

under or with respect to any indebtedness, property, or other assets constituting or securing any

property.

     (7) To make demands, give notices of default, notices of intention to accelerate, notices of

acceleration, or such other notices as the corporation deems necessary or appropriate, and to take

other actions and exercise other rights that may be taken under the terms of any loan agreements,

security agreements, guaranties, or other documents or agreements evidencing, or otherwise

relating to, the property, including foreclosure, lease, sale, taking possession of, realization upon,

or any other disposition of any property or any collateral therefor or guarantee thereof.

     (8) To exercise any powers and any duties vested in the commerce corporation as a partner,

joint venturer, participant, or other joint-interest holder with respect to any property, or to concur

(or not) with persons jointly interested with the commerce corporation in any property.

     (9) With respect to the property: (i) To sue on, or otherwise prosecute, any claim or cause

of action, or commence or seek any legal, equitable, or administrative or other remedy in any legal,

administrative, arbitration, mediation, or other proceeding whatsoever (including, non-judicial

repossessions and foreclosures or similar actions to recover collateral); (ii) To defend, or otherwise

participate for, or in the name of, the commerce corporation in any legal, administrative, arbitration,

mediation, or other proceedings; (iii) To process, determine, or adjudge any claim or cause of action

for, or in the name of, the commerce corporation; (iv) To compromise, settle, discharge or resolve,

or make, execute, or deliver any endorsements, acquittances, releases, receipts, or other discharges

of any claim, cause of action, determination, judgment, or other proceeding for, or in the name of,

the commerce corporation; and (v) To prepare, execute, and file ad valorem, franchise and other

tax returns, protests and suits against taxing authorities, and to prepare, execute, and file other

governmental or quasi-governmental reports, declarations, applications, requests and documents in

connection with any property, and to pay taxes in connection with the property as the corporation

deems necessary or appropriate, or as otherwise required by law.

     (10) Any third party shall be entitled to rely on a writing signed by the corporation to

conclusively establish the identity of a particular Property as property for all purposes hereof.

     (d) To own, hold, improve, operate, manage, and regulate utilities at the Quonset Business

Park and to establish rates, fees, and charges, to adopt regulations, and to impose penalties for any

services or utilities it provides, or causes to have available, and to have functions and exercise

powers as necessary and appropriate under the provisions of §§ 42-64-4, 42-64-7.4, 42-64-7.8, 42-

64-7.9 and 42-64-9.1 -- 42-64-9.10, inclusive.

     (e) To enter into agreements with any city, town, district, or public corporation with regard

to application and/or administration of zoning or other land use ordinances, codes, plans, or

regulations, and cities, towns, districts, and public corporations are hereby authorized and

empowered, notwithstanding any other law to the contrary, to enter into such agreements with the

corporation and to do all things necessary to carry out their obligations under such agreements; in

the absence of any such agreement the corporation shall act in accordance with the provisions of §

42-64-13.

     (f) To enter into agreements, including with any state agency, city, town, district, or public

corporation, for the provision of police, security, fire, sanitation, health protection, and other public

services.

     (g) To be exempt from taxation and to enter into agreements for payments in lieu of taxes

as provided for in § 42-64-20.

     (h) To establish a stormwater management and conveyance system and regulate

connections, user fees, charges and assessments in connection therewith. In particular, the

corporation shall have full and complete power and authority to:

     (1) Limit, deny, or cause appropriate direct or indirect connections to be made between any

building or property located in the Quonset Business Park, or from any location outside the

boundaries of the Quonset Business Park and discharging into the corporation's stormwater

management and conveyance systems. The corporation may prescribe those rules and regulations

for stormwater runoff, that in the opinion of the corporation, are necessary and appropriate for the

maintenance and operation of the stormwater management and conveyance systems, and may

establish, from time to time, rules and regulations relating to stormwater management in the

Quonset Business Park. Any person or entity having an existing connection to the stormwater

management and conveyance systems or currently discharging into such systems, will obtain a

permit from the corporation in accordance with its rules and regulations. No person or entity shall,

without first being granted a written permit from the corporation in accordance with its rules and

regulations, make any future connection or permit any runoff from any structure or property to any

stormwater management and conveyance systems, or any appurtenance thereto, without first being

granted a written permit from the corporation in accordance with its rules and regulations.

     (2) Compel any person or entity within the Quonset Business Park, for the purpose of

stormwater runoff, to establish a direct connection on the property of the person or entity, or at the

boundary thereof, to the corporation's stormwater management and conveyance systems. These

connections shall be made at the expense of such person or entity. The term "appurtenance" as used

herein shall be construed to include adequate pumping facilities, whenever the pumping facilities

shall be necessary to deliver the stormwater runoff to the stormwater management and conveyance

systems.

     (3) Assess any person or entity having a direct or indirect connection (including, without

limitation, via runoff) to the Quonset Business Park stormwater management and conveyance

systems the reasonable charges for the use, operation, maintenance, and improvements to the

systems. The corporation shall also be entitled, in addition to any other remedies available, to assess

fines for violations of the rules and regulations established by the corporation with respect to

stormwater management.

     (4) Collect the fees, charges, and assessments from any person or entity so assessed. Each

person or entity so assessed shall pay the fees, charges, or assessments within the time frame

prescribed by the rules and regulations of the corporation. The corporation may collect the fees,

charges, and assessments in the same manner in which taxes are collected by municipalities, with

no additional fees, charges, assessments, or penalties (other than those provided for in chapter 9 of

title 44). All unpaid charges shall be a lien upon the real estate of the person or entity. The lien shall

be filed in the records of land evidence for the city or town in which the property is located and the

corporation shall simultaneously, with the filing of the lien, give notice to the property owner.

Owners of property subject to a lien for unpaid charges are entitled to a hearing within fourteen

(14) days of the recording of the lien.

     (5) Notwithstanding the provisions of subsection (h)(4) of this section, the corporation is

authorized to terminate the water supply service or prohibit the use of the corporation's stormwater

management and conveyance systems of any person or entity for the nonpayment of storm water

management user fees, charges, and assessments. The corporation shall notify the user of

termination of water supply or use of the stormwater management and conveyance systems at least

forty-eight (48) hours prior to ceasing service. The corporation may assess any person or entity any

fees, charges, and assessments affiliated with the shut off and restoration of service.

     (6) Without in any way limiting the foregoing powers and authority, the corporation is also

hereby empowered to: (i) Establish a fee system and raise funds for administration and operation

of the stormwater management and conveyance systems; (ii) Prepare long-range, stormwater

management master plans; (iii) Implement a stormwater management district; (iv) Retrofit existing

structures to improve water quality or alleviate downstream flooding or erosion; (v) Properly

maintain existing stormwater management and conveyance systems; (vi) Hire personnel to carry

out the functions of the stormwater management and conveyance systems; (vii) Receive grants,

loans, or funding from state and federal water-quality programs; (viii) Grant credits to property

owners who maintain retention and detention basins or other filtration structures on their property;

(ix) Make grants for implementation of stormwater management plans; (x) Purchase, acquire, sell,

transfer, or lease real or personal property; (xi) Impose liens; (xii) Levy fines and sanctions for

noncompliance; (xiii) Provide for an appeals process; and (xiv) Contract for services in order to

carry out the function of the stormwater management and conveyance systems.

     (i) To purchase and obtain water supply and water service from any city, town, water

district, or other water supply authority. In particular, the corporation is authorized to:

     (1) Enter into agreements or contracts with any city, town, county, water district, or other

water supply authority to purchase, acquire, and receive water supply and water service.

     (2) Enter into cooperative agreements with cities, towns, counties, water districts, or other

water supply authorities for the interconnection of facilities or for any other lawful corporate

purposes necessary or desirable to effect the purposes of this chapter.

     (3) Connect the water supply system at Quonset Business Park with any city, town, county,

water district, or other water supply authority that receives or has a connection with the city of

Providence and/or the Providence Water Supply Board (or any successor thereof) and purchase,

connect to, receive, and enter into agreements to receive water supply from any city, town, county,

water district, or other water supply authority regardless of the origin of such water supply. The

city of Providence and the Providence Water Supply Board (and any successor thereof) are

authorized and directed to supply water to the Quonset Business Park either directly or via

connections between the Quonset Development Corporation and any city, town, county, water

district, or other water supply authority, notwithstanding any terms to the contrary in any

agreement, including, without limitation, any agreement between any city, town, county, water

district, or other water supply authority and the city of Providence and/or the Providence Water

Supply Board (or its or their predecessors), or the provisions of chapter 16 of title 39. In addition,

the provisions of § 18 of chapter 1278 of the public laws of Rhode Island of 1915 as amended, and

any other public law that would conflict with the terms hereof, are hereby amended to authorize

the provision of water supply by the city of Providence and the Providence Water Supply Board

(or any successor thereof) to the Quonset Business Park and to authorize any additional connections

in accordance herewith. There shall be no requirement that the corporation demonstrate public

necessity before entering into such agreements, connecting to such water supplies, or receiving

such water as described in this subsection, but the corporation shall be subject to the other

applicable provisions of chapter 15 of title 46.

     (d) The corporation shall have and may exercise all powers set forth in general laws § 42-

64.33-6, § 42-64.33-7 and § 42-64.33-9 in the place and stead of the state and local partnership

council but only to the extent the state and local partnership council has not exercised jurisdiction

with respect to the subject matter or project over which the corporation intends to act, and upon the

exercise of such powers in relation to a municipality or a project therein, notice of which shall be

provided to the state and local partnership council of the exercise of jurisdiction by the corporation.

The corporation shall have exclusive jurisdiction and authority of the subject matter thereof to the

exclusion of the state and local partnership council, unless otherwise agreed to in writing by the

corporation.

     SECTION 2. Section 42-64.10-7 of the General Laws in Chapter 42-64.10 entitled

"Quonset Development Corporation" is hereby amended to read as follows:

     42-64.10-7. Directors, officers and employees.

     (a) Directors.

     (1) Except in the exercise of the powers conferred under § 42-64.10-6(d), Tthe powers of

the corporation shall be vested in a board of directors consisting of eleven (11) members. The

membership of the board shall consist of the executive director of the Rhode Island economic

development corporation as chairperson, (who shall vote only in the event of a tie), six (6) members

appointed by the governor, with the advice and consent of the senate, two (2) members appointed

by the town council of the town of North Kingstown, one member appointed by the town council

of the town of Jamestown, and one member appointed by the town council of the town of East

Greenwich. The initial members of the board shall be divided into three (3) classes and shall serve

initial terms on the board of directors as follows: two (2) of the directors appointed by the governor;

one of the directors appointed by the town council of the town of North Kingstown shall be

appointed for an initial term of one year; two (2) of the directors appointed by the governor, one

director appointed by the town council of the town of North Kingstown and the director appointed

by the town of East Greenwich shall be appointed for an initial term of two (2) years; and two (2)

of the directors appointed by the governor and one director appointed by the town of Jamestown

shall be appointed for an initial term of three (3) years. Upon expiration of each initial term and

upon the expiration of each term thereafter, a successor shall be appointed by the same authority

that made the initial appointment, and in the case of appointments by the governor with the advice

and consent of the senate, to serve for a term of three (3) years so that members of the board of

directors shall serve for staggered terms of three (3) years each. A vacancy on the board, other than

by expiration, shall be filled in the same manner as an original appointment, but only for the

unexpired portion of the term. If a vacancy occurs with respect to one of the directors appointed by

the governor when the senate is not in session, the governor shall appoint a person to fill the

vacancy, but only until the senate shall next convene and give its advice and consent to a new

appointment. A member shall be eligible to succeed himself or herself. Appointed directors shall

not serve more than two (2) successive three (3) year terms but may be reappointed after not being

a director for a period of at least twelve (12) months. Each appointed director shall hold office for

the term for which the director is appointed and until the director's successor shall have been

appointed and qualified, or until the director's earlier death, resignation or removal. Except for

members of the town council of the town of North Kingstown, who may serve as members of the

board of directors, no director shall be an elected official of any governmental entity. In the exercise

of the powers conferred under § 42-64.10-6(d) and only with respect to actions taken consistent

with the program established under chapter 64.33 of title 42, which actions may not involve land

in the Quonset Business Park, the powers of the corporation shall be vested in a board of directors

consisting of seven (7) members, including the chairperson, who shall be the secretary of commerce

and vote only in the event of a tie, and six members to be appointed by the governor with the advice

and consent of the senate, provided that the number of board members shall be increased in

instances where a project is situated in one or more municipalities. Such powers conferred under §

42-64.10-6(d) may only be exercised in connection with carrying out the program established under

chapter 64.33 of title 42. In the exercise of the powers conferred under § 42-64.10-6(d), the board

shall add, and the total number of directors shall be increased by (i) two (2) new members appointed

by the governing body of the municipality in which the project is located when a project is located

in a single municipality or (ii) new members appointed by the governing body of each municipality

in which the project is located when a project is located in more than one municipality, with each

municipality appointing one member to the board.

     SECTION 3. Section 42-64.20-3 of the General Laws in Chapter 42-64.20 entitled

"Rebuild Rhode Island Tax Credit Act" is hereby amended to read as follows:

     42-64.20-3. Definitions.

     (1) "Adaptive reuse" means the conversion of an existing structure from the use for which

it was constructed to a new use by maintaining elements of the structure and adapting such elements

to a new use.

     (2) "Affiliate" means an entity that directly or indirectly controls, is under common control

with, or is controlled by the business. Control exists in all cases in which the entity is a member of

a controlled group of corporations as defined pursuant to § 1563 of the Internal Revenue Code of

1986 (26 U.S.C. § 1563) or the entity is an organization in a group of organizations under common

control as defined pursuant to subsection (b) or (c) of § 414 of the Internal Revenue Code of 1986

(26 U.S.C. § 414). A taxpayer may establish by clear and convincing evidence, as determined by

the tax administrator, that control exists in situations involving lesser percentages of ownership

than required by those statutes. An affiliate of a business may contribute to meeting either the

capital investment or full-time employee requirements of a business that applies for a credit under

this chapter.

     (3) "Affordable housing" means housing for sale or rent with combined rental costs or

combined mortgage loan debt service, property taxes, and required insurance that do not exceed

thirty percent (30%) of the gross annual income of a household earning up to eighty percent (80%)

of the area median income, as defined annually by the United States Department of Housing and

Urban Development.

     (4) "Applicant" means a developer applying for a rebuild Rhode Island tax credit under this

chapter.

     (5) "Business" means a corporation as defined in § 44-11-1(4), or a partnership, an S

corporation, a non-profit corporation, a sole proprietorship, or a limited liability corporation. A

business shall include an affiliate of the business if that business applies for a credit based upon

any capital investment made by an affiliate.

     (6) "Capital investment" in a real estate project means expenses by a developer incurred

after application for:

     (i) Site preparation and construction, repair, renovation, improvement, equipping, or

furnishing on real property or of a building, structure, facility, or improvement to real property;

     (ii) Obtaining and installing furnishings and machinery, apparatus, or equipment, including

but not limited to material goods for the operation of a business on real property or in a building,

structure, facility, or improvement to real property.

     In addition to the foregoing, if a developer acquires or leases a qualified development

project, the capital investment made or acquired by the seller or owner, as the case may be, if

pertaining primarily to the premises of the qualified development project, shall be considered a

capital investment by the developer and, if pertaining generally to the qualified development project

being acquired or leased, shall be allocated to the premises of the qualified development project on

the basis of the gross leasable area of the premises in relation to the total gross leasable area in the

qualified development project. The capital investment described herein shall be defined through

rules and regulations promulgated by the commerce corporation.

     (7) "Certified historic structure" means a property which is located in the state of Rhode

Island and is

     (i) Listed individually on the national register of historic places; or

     (ii) Listed individually in the state register of historic places; or

     (iii) Located in a registered historic district and certified by either the Rhode Island

historical preservation and heritage commission created pursuant to § 42-45-2 or the Secretary of

the Interior as being of historic significance to the district.

     (8) "Commerce corporation" means the Rhode Island commerce corporation established

pursuant to § 42-64-1 et seq.

     (9) "Commercial" shall mean non-residential development.

     (10) "Developer" means a person, firm, business, partnership, association, political

subdivision, or other entity that proposes to divide, divides, or causes to be divided real property

into a subdivision or proposes to build, or builds a building or buildings or otherwise improves land

or existing structures, which division, building, or improvement qualifies for benefits under this

chapter.

     (11) "Development" means the improvement of land through the carrying out of building,

engineering, or other operations in, on, over, or under land, or the making of any material change

in the use of any buildings or land for the purposes of accommodating land uses.

     (12) "Eligibility period" means the period in which a developer may claim a tax credit

under this act, beginning with the tax period in which the commerce corporation accepts

certification from the developer that it has met the requirements of the act and extending thereafter

for a term of five (5) years.

     (13) "Full-time employee" means a person who is employed by a business for consideration

for a minimum of at least thirty-five (35) hours per week, or who renders any other standard of

service generally accepted by custom or practice as full-time employment, or who is employed by

a professional employer organization pursuant to an employee leasing agreement between the

business and the professional employer organization for a minimum of thirty-five (35) hours per

week, or who renders any other standard of service generally accepted by custom or practice as

full-time employment, and whose wages are subject to withholding.

     (14) "Hope community" means a municipality for which the five-year (5) average

percentage of families with income below the federal poverty level exceeds the state five-year (5)

average percentage, both as most recently reported by the U.S. Department of Commerce, Bureau

of the Census.

     (15) “Manufacturer” shall mean any entity that:

     (a) Uses any premises within the state primarily for the purpose of transforming raw

materials into a finished product for trade through any or all of the following operations: adapting,

altering, finishing, making, processing, refining, metalworking, and ornamenting, but shall not

include fabricating processes incidental to warehousing or distribution of raw materials, such as

alteration of stock for the convenience of a customer; or

     (b) Is described in codes 31-33 of the North American Industry Classification System, as

revised from time to time.

     (16) "Mixed use" means a development comprising both commercial and residential

components.

     (176) "Partnership" means an entity classified as a partnership for federal income tax

purposes.

     (187) "Placed in service" means the earlier of i) substantial construction or rehabilitation

work has been completed which would allow for occupancy of an entire structure or some

identifiable portion of a structure, as established in the application approved by the commerce

corporation board or ii) receipt by the developer of a certificate, permit or other authorization

allowing for occupancy of the project or some identifiable portion of the project by the municipal

authority having jurisdiction.

     (198) "Project" means qualified development project as defined under subsection (22).

     (2019) "Project area" means land or lands under common ownership or control in which a

qualified development project is located.

     (210) "Project cost" means the costs incurred in connection with the qualified development

project or qualified residential or mixed use project by the applicant until the issuance of a

permanent certificate of occupancy, or until such other time specified by the commerce corporation,

for a specific investment or improvement, as defined through rules and regulations promulgated by

the commerce corporation.

     (221) "Project financing gap" means

     (i) The part of the total project cost that remains to be financed after all other sources of

capital have been accounted for (such sources will include, but not be limited to, developer-

contributed capital), which shall be defined through rules and regulations promulgated by the

commerce corporation, or

     (ii) The amount of funds that the state may invest in a project to gain a competitive

advantage over a viable and comparable location in another state by means described in this chapter.

     (232) "Qualified development project" means a specific construction project or

improvement, including lands, buildings, improvements, real and personal property or any interest

therein, including lands under water, riparian rights, space rights and air rights, acquired, owned,

leased, developed or redeveloped, constructed, reconstructed, rehabilitated or improved,

undertaken by a developer, owner or tenant, or both, within a specific geographic area, meeting the

requirements of this chapter, as set forth in an application made to the commerce corporation.

     (243) "Recognized historical structure" means a property which is located in the state of

Rhode Island and is commonly considered to be of historic or cultural significance as determined

by the commerce corporation in consultation with the state historic preservation officer.

     (25) "Residential" means a development of residential dwelling units.

     (265) "Targeted industry" means any advanced, promising, or otherwise prioritized

industry identified in the economic development vision and policy promulgated pursuant to § 42-

64.17-1 or, until such time as any such economic development vision and policy is promulgated,

as identified by the commerce corporation.

     (276) "Transit oriented development area" means an area in proximity to transit

infrastructure that will be further defined by regulation of the commerce corporation in consultation

with the Rhode Island department of transportation.

     (287) "Workforce housing" means housing for sale or rent with combined rental costs or

combined mortgage loan debt service, property taxes, and required insurance that do not exceed

thirty percent (30%) of the gross annual income of a household earning between eighty percent

(80%) and one hundred and forty percent (140%) of the area median income, as defined annually

by the United States Department of Housing and Urban Development.

     SECTION 4. Section 42-64.20-5 of the General Laws in Chapter 42-64.20 entitled

"Rebuild Rhode Island Tax Credit" is hereby amended to read as follows:

     42-64.20-5. Tax credits.

     (a) An applicant meeting the requirements of this chapter may be allowed a credit as set

forth hereinafter against taxes imposed upon such person under applicable provisions of title 44 of

the general laws for a qualified development project.

     (b) To be eligible as a qualified development project entitled to tax credits, an applicant's

chief executive officer or equivalent officer shall demonstrate to the commerce corporation, at the

time of application, that:

     (1) The applicant has committed capital investment or owner equity of not less than twenty

percent (20%) of the total project cost;

     (2) There is a project financing gap in which after taking into account all available private

and public funding sources, the project is not likely to be accomplished by private enterprise

without the tax credits described in this chapter; and

     (3) The project fulfills the state's policy and planning objectives and priorities in that:

     (i) The applicant will, at the discretion of the commerce corporation, obtain a tax

stabilization agreement from the municipality in which the real estate project is located on such

terms as the commerce corporation deems acceptable;

     (ii) It (A) is a commercial development consisting of at least 25,000 square feet occupied

by at least one business employing at least 25 full-time employees after construction or such

additional full-time employees as the commerce corporation may determine; (B) is a multi-family

residential development in a new, adaptive reuse, certified historic structure, or recognized

historical structure consisting of at least 20,000 square feet and having at least 20 residential units

in a hope community; or (C) is a mixed-use development in a new, adaptive reuse, certified historic

structure, or recognized historical structure consisting of at least 25,000 square feet occupied by at

least one business, subject to further definition through rules and regulations promulgated by the

commerce corporation; and

     (iii) Involves a total project cost of not less than $5,000,000, except for a qualified

development project located in a hope community or redevelopment area designated under § 45-

32-4 in which event the commerce corporation shall have the discretion to modify the minimum

project cost requirement.

     (c) The commerce corporation shall develop separate, streamlined application processes

for the issuance of Rebuild RI tax credits for each of the following:

     (1) Qualified development projects that involve certified historic structures;

     (2) Qualified development projects that involve recognized historical structures;

     (3) Qualified development projects that involved at least one manufacturer; and

     (4) Qualified development projects that include affordable housing or workforce housing.

     (d) Applications made for a historic structure or recognized historic structure tax credit

under chapter 33.6 of title 44 shall be considered for tax credits under this chapter. The division of

taxation, at the expense of the commerce corporation, shall provide communications from the

commerce corporation to those who have applied for and are in the queue awaiting the offer of tax

credits pursuant to chapter 33.6 of title 44 regarding their potential eligibility for the Rebuild RI

Tax Credit program.

     (e) Applicants (i) who have received the notice referenced in subsection (d) above and who

may be eligible for a tax credit pursuant to chapter 33.6 of title 44, (ii) whose application involves

a certified historic structure or recognized historical structure, or (iii) whose project is occupied by

at least one manufacturer shall be exempt from the requirements of subparagraphs (b)(3)(ii) and

(b)(3)(iii) of this section. The following procedure shall apply to such applicants:

     (1) The division of taxation shall remain responsible for determining the eligibility of an

applicant for tax credits awarded under chapter 33.6 of title 44;

     (2) The commerce corporation shall retain sole authority for determining the eligibility of

an applicant for tax credits awarded under this chapter; and

     (3) The commerce corporation shall not award in excess of fifteen percent (15%) of the

annual amount appropriated authorized in any fiscal year to applicants seeking tax credits pursuant

to this subsection (ce).

     (df) Maximum project credit.

     (i) For qualified development projects, the maximum tax credit allowed under this chapter

shall be the lesser of (1) thirty percent (30%) of the total project cost; or (2) the amount needed to

close a project financing gap (after taking into account all other private and public funding sources

available to the project), as determined by the commerce corporation.

     (ii) The credit allowed pursuant to this chapter shall not exceed fifteen million dollars

($15,000,000) for any qualified development project under this chapter. No building or qualified

development project to be completed in phases or in multiple projects shall exceed the maximum

project credit of fifteen million dollars ($15,000,000) for all phases or projects involved in the

rehabilitation of such building. Provided, however, that for purposes of this subsection and no more

than once in a given fiscal year, the commerce corporation may consider the development of land

and buildings by a developer on the "I-195 land" (as defined in § 42-64.24-3(6) of the general laws)

as a separate, qualified development project from a qualified development project by a tenant or

owner of a commercial condominium or similar legal interest including leasehold improvement, fit

out, and capital investment. Such qualified development project by a tenant or owner of a

commercial condominium or similar legal interest on the I-195 land may be exempted from

subparagraph (fd)(i)(1). Separate buildings on the I-195 land may be considered to be separate

qualified development projects when determining eligibility under this chapter.

     (eg) Credits available under this chapter shall not exceed twenty percent (20%) of the

project cost, provided, however, that the applicant shall be eligible for additional tax credits of not

more than ten percent (10%) of the project cost, if the qualified development project meets any of

the following criteria or other additional criteria determined by the commerce corporation from

time to time in response to evolving economic or market conditions:

     (1) The project includes adaptive reuse or development of a recognized historical structure;

     (2) The project is undertaken by or for a targeted industry;

     (3) The project is located in a transit-oriented development area;

     (4) The project includes residential development of which at least twenty percent (20%) of

the residential units are designated as affordable housing or workforce housing;

     (5) The project includes the adaptive reuse of property subject to the requirements of the

industrial property remediation and reuse act, § 23-19.14-1 et seq.; or

     (6) The project includes commercial facilities constructed in accordance with the minimum

environmental and sustainability standards, as certified by the commerce corporation pursuant to

Leadership in Energy and Environmental Design or other equivalent standards.

     (fh) Maximum aggregate credits. The aggregate sum authorized pursuant to this chapter

shall not exceed one two hundred and fifty million dollars ($150250,000,000), and the commerce

corporation shall promulgate guidelines regarding the amounts to be authorized for certified

historic structures, recognized historical structures, and residential projects.

     (gi) Tax credits shall not be allowed under this chapter prior to the taxable year in which

the project is placed in service.

     (hj) The amount of a tax credit allowed under this chapter shall be allowable to the taxpayer

in up to five, annual increments; no more than thirty percent (30%) and no less than fifteen percent

(15%) of the total credits allowed to a taxpayer under this chapter may be allowable for any taxable

year.

     (ik) If the portion of the tax credit allowed under this chapter exceeds the taxpayer's total

tax liability for the year in which the relevant portion of the credit is allowed, the amount that

exceeds the taxpayer's tax liability may be carried forward for credit against the taxes imposed for

the succeeding four (4) years, or until the full credit is used, whichever occurs first. Credits allowed

to a partnership, a limited liability company taxed as a partnership, or multiple owners of property

shall be passed through to the persons designated as partners, members, or owners respectively pro

rata or pursuant to an executed agreement among such persons designated as partners, members,

or owners documenting an alternate distribution method without regard to their sharing of other tax

or economic attributes of such entity.

     (jl) The commerce corporation in consultation with the division of taxation shall establish,

by regulation, the process for the assignment, transfer, or conveyance of tax credits.

     (km) For purposes of this chapter, any assignment or sales proceeds received by the

taxpayer for its assignment or sale of the tax credits allowed pursuant to this section shall be exempt

from taxation under title 44. If a tax credit is subsequently revoked or adjusted, the seller's tax

calculation for the year of revocation or adjustment shall be increased by the total amount of the

sales proceeds, without proration, as a modification under chapter 30 of title 44. In the event that

the seller is not a natural person, the seller's tax calculation under chapters 11, 13, 14, or 17 of title

44 of the general laws, as applicable, for the year of revocation, or adjustment, shall be increased

by including the total amount of the sales proceeds without proration.

     (ln) The tax credit allowed under this chapter may be used as a credit against corporate

income taxes imposed under chapters 11, 13, 14, or 17, of title 44, or may be used as a credit against

personal income taxes imposed under chapter 30 of title 44 for owners of pass-through entities such

as a partnership, a limited liability company taxed as a partnership, or multiple owners of property.

     (mo) In the case of a corporation, this credit is only allowed against the tax of a corporation

included in a consolidated return that qualifies for the credit and not against the tax of other

corporations that may join in the filing of a consolidated tax return.

     (np) Upon request of a taxpayer and subject to annual appropriation, the state shall redeem

such credit, in whole or in part, for ninety percent (90%) of the value of the tax credit. The division

of taxation, in consultation with the commerce corporation, shall establish by regulation a

redemption process for tax credits.

     (oq) Projects eligible to receive a tax credit under this chapter may, at the discretion of the

commerce corporation, be exempt from sales and use taxes imposed on the purchase of the

following classes of personal property only to the extent utilized directly and exclusively in such

project: (1) Furniture, fixtures and equipment, except automobiles, trucks, or other motor vehicles;

or (2) Such other materials, including construction materials and supplies, that are depreciable and

have a useful life of one year or more and are essential to the project.

     (pr) The commerce corporation shall promulgate rules and regulations for the

administration and certification of additional tax credit under subsection (e), including criteria for

the eligibility, evaluation, prioritization, and approval of projects that qualify for such additional

tax credit.

     (qs) The commerce corporation shall not have any obligation to make any award or grant

any benefits under this chapter.

     SECTION 5. Section 42-64.20-7 of the General Laws in Chapter 42-64.20 entitled

"Rebuild Rhode Island Tax Credit Act" is hereby amended to read as follows:

     42-64.20-7. Rebuild Rhode Island tax credit fund.

     (a) There is hereby established at the commerce corporation a restricted account known as

the rebuild Rhode Island tax-credit fund (the "Fundfund") in which all amounts appropriated for

the program created under this chapter shall be deposited. The fund shall be used (i) to pay for the

redemption of tax credits or reimbursement to the state for tax credits applied against a taxpayer's

liability. The commerce corporation may pledge and reserve amounts deposited into the fund for

the purpose of securing payment for the redemption of tax credits or for making reimbursements to

municipalities pursuant to chapter 64.22 of title 42 of the general laws. The fund shall be exempt

from attachment, levy, or any other process at law or in equity. The director of the department of

revenue shall make a requisition to the commerce corporation for funding during any fiscal year as

may be necessary to pay for the redemption of tax credits presented for redemption or to reimburse

the state for tax credits applied against a taxpayer's tax liability. The commerce corporation shall

pay from the fund such amounts as requested by the director of the department of revenue necessary

for redemption or reimbursement in relation to tax credits granted under this chapter; provided,

however, that the commerce corporation shall not be required to pay from the fund such sums

pledged and reserved by the commerce corporation, as permitted in this section, except for

redemption of tax credits.

     (b) Notwithstanding anything in this chapter to the contrary, the commerce corporation

may make a loan or equity investment as an alternative incentive in lieu of the provision of tax

credits so long as the applicant otherwise qualifies for tax credits under this chapter. In addition to

the qualification requirements of this chapter, any loan or equity investment shall be subject to the

provisions of §§ 42-64.20-5(b), (d), (e), (f), (g), (n), (o), (ph), (j), (q), (r), and (s), and (q), 42-64.20-

7, 42-64.20-8, 42-64.20-9, and 42-64.20-10 as if such loan or equity investment were a tax credit.

The commerce corporation may pay, reserve, and/or pledge monies for a loan or equity investment

from the fund.

     (c) The commerce corporation may provide appropriate technical assistance to an applicant

for tax credits for projects under this chapter, including projects involving historic structures and

recognized historical structures to enable the applicant to provide all information and data necessary

for the consideration of its application by the commerce corporation. The cost of technical

assistance provided to applicants can be paid from the fund in an amount not to exceed $250,000

per year.

     SECTION 6. Section 42-64.20-10 of the General Laws in Chapter 42-64.20 entitled

“Rebuild Rhode Island Tax Credit Act” is hereby amended to read as follows:

     42-64.20-10. Sunset

     No credits shall be authorized to be reserved pursuant to this chapter after June 30,

2020.December 31, 2023.

     SECTION 7. Section 42-64.21-5 of the General Laws in Chapter 42-64.21 entitled "Rhode

Island Tax Increment Financing" is hereby amended to read as follows:

     42-64.21-5. Financing.

     (a) Up to the limits established in subsection (b) of this section and in accordance with a

TIF agreement, the division of taxation shall pay to the developer incremental state revenues

directly realized from projects or businesses operating in the qualifying TIF area from the taxes

assessed and collected under chapters 11, 13, 14, 17, 18, 19, and 30 of Title 44 of the general laws

or realized from such venue ticket sales or parking taxes as may be established and levied under

state law.

     (b) Up to 75 percent of the projected annual incremental revenues may be allocated under

a TIF agreement. The incremental revenue for the revenues listed in subsection (a) of this section

shall be calculated as the difference between the amount collected in any fiscal year from any

eligible revenue source included in the TIF agreement, less the revenue increment base for that

eligible revenue.

     (c) The division of taxation is hereby authorized and empowered to segregate the annual

incremental revenues allocated under a TIF agreement and transfer such amounts to the general

treasurer for deposit in a restricted account known as the TIF fund. The TIF fund shall be used

solely to pay for the incentives granted under this chapter. The director of the department of revenue

shall annually determine if a surplus exists in the TIF fund over amounts necessary to fund

incentives under this chapter in a fiscal year and may authorize the general treasurer to transfer any

surplus to the general fund. The unexpended balance of such sum of money received and

appropriated for the TIF fund remaining in the treasury at the close of each fiscal year, shall be

continued to and is hereby annually appropriated for the same account for the ensuing year.

     (d) Under conditions defined by the commerce corporation and in consultation with the

department of revenue, those all taxes eligible for inclusion in this TIF programidentified in § 42-

64.21-5(a) that would otherwise comprise 75% of the incremental revenue available for allocation

under § 42-64.21-5(b), may instead be exempted by the commerce corporation up to the levels

permitted by this act in cases of significant taxpayers or for transactions occurring within a

qualifying TIF area. Any incremental tax revenue exempted by the commerce corporation pursuant

to this act shall not be assessed and/or collected as a tax from any person or entity. Such significant

taxpayers, and any other person or entity entering into a contract with the commerce corporation

consummating a transaction giving rise to the exemptions provided pursuant to this subsection,

may shall instead be required to contribute payments in lieu of taxes (PILOTs) into a dedicated

fund established by the commerce corporation. Such payments shall be up to 75 percent of equal

to the amount that would otherwise be due to the state in the form of taxation in the absence of such

exemption as per the provisions of this statute. Such dedicated funds must be used for the purposes

described in this act. The balance of said state revenue not subject to an exemption under this act

shall be deposited in the general fund in the ordinary course by the division of taxation. The

commerce corporation and any other person or entity entering into transactions pursuant to this act

shall provide to the division of taxation in a format it may reasonably require, such information that

will allow it to confirm compliance with this act, the terms of the documents related to the

transactions giving rise to the exemptions, and all applicable state law. The commerce corporation

may issue revenue bonds secured by this dedicated fund. Such bonds shall not be a general

obligation of the state. (e) The commerce corporation shall promulgate an application form and

procedure for the program.

     SECTION 8. Section 42-64.21-9 of the General Laws in Chapter 42-64.21 entitled “Rhode

Island Tax Increment Financing” is hereby amended as follows:

     42-64.21-9. Sunset.

     No credits shall be authorized to be reserved pursuant to this chapter after December 31,

2023June 30, 2020.

     SECTION 9. Section 42-64.22-15 of the General Laws in Chapter 42-64.22 entitled “Tax

Stabilization Incentive” is hereby amended as follows:

     42-64.22-15. Sunset.

     The commerce corporation shall enter into no agreement under this chapter after December

31, 2023June 30, 2020.

     SECTION 10. Section 42-64.23-8 of the General Laws in Chapter 42-64.23 entitled “First

Wave Closing Fund Act” is hereby amended as follows:

     42-64.23-8. Sunset.

     No financing shall be authorized to be reserved pursuant to this chapter after December 31,

2023June 30, 2020.

     SECTION 11. Section 42-64.24-8 of the General Laws in Chapter 42-64.24 entitled “I-195

Redevelopment Project Fund Act” is hereby amended as follows:

     42-64.24-8. Sunset.

     No funding, credits, or incentives shall be authorized or authorized to be reserved pursuant

to this chapter after December 31, 2023June 30, 2020.

     SECTION 12. Section 42-64.25-14 of the General Laws in Chapter 42-64.25 entitled

“Small Business Assistance Program Act” is hereby repealed:

     42-64.25-14. Sunset.

     No grants, funding, or incentives shall be authorized pursuant to this chapter after June 30,

2020.

     SECTION 13. Section 42-64.26-3 of the General Laws in Chapter 42-64.26 entitled “Stay

Invested in RI Wavemaker Fellowship” is hereby amended to read as follows:

     42-64.26-3. Definitions.

     As used in this chapter:

     (1) “Eligible graduate” means an individual who meets the eligibility requirements under

this chapter.

     (2) “Applicant” means an eligible graduate who applies for a tax credit for education loan

repayment expenses under this chapter.

     (3) “Award” means a tax credit awarded by the commerce corporation to an applicant as

provided under this chapter.

     (4) “Business” means any applicant that is a corporation, state bank, federal savings bank,

trust company, national banking association, bank holding company, loan and investment

company, mutual savings bank, credit union, building and loan association, insurance company,

investment company, broker-dealer company or surety company, limited liability company,

partnership, sole proprietorship, or federal agency or subsidiaries thereof.

     (54) “Taxpayer” means an applicant who receives a tax credit under this chapter.

     (65) “Commerce corporation” means the Rhode Island commerce corporation established

pursuant to chapter 64 of title 42.

     (76) “Eligible expenses” or “education loan repayment expenses” means annual higher

education loan repayment expenses, including, without limitation, principal, interest and fees, as

may be applicable, incurred by an eligible graduate and which the eligible graduate is obligated to

repay for attendance at a post-secondary institution of higher learning.

     (87) “Eligibility period” means a term of up to four (4) consecutive service periods

beginning with the date that an eligible graduate receives initial notice of award under this chapter

and expiring at the conclusion of the fourth service period after such date specified.

     (98) “Eligibility requirements” means the following qualifications or criteria required for

an applicant to claim an award under this chapter:

     (i) That the applicant shall have graduated from an accredited two (2) year, four (4) year

or graduate post-secondary institution of higher learning with an associate's, bachelor's, graduate,

or post-graduate degree and at which the applicant incurred education loan repayment expenses;

     (ii) That the applicant shall be a full-time employee with a Rhode Island-based employer

located in this state throughout the eligibility period, whose employment is for work in one or more

of the following covered fields: life, natural or environmental sciences; computer, information or

software technology; advanced mathematics or finance; engineering; industrial design or other

commercially related design field; or medicine or medical device technology.

     (109) “Full-time employee” means a person who is employed in Rhode Island by a business

for consideration for a minimum of at least thirty-five (35) hours per week, or who renders any

other standard of service generally accepted by custom or practice as full-time employment, or who

is employed by a professional employer organization pursuant to an employee leasing agreement

between the business and the professional employer organization for a minimum of thirty-five (35)

hours per week, or who renders any other standard of service generally accepted by custom or

practice as full-time employment and whose earnings are subject to Rhode Island income tax, and

whose wages are subject to withholding.

     (110) “Service period” means a twelve (12) month period beginning on the date that an

eligible graduate receives initial notice of award under this chapter.

     (121) “Student loan” means a loan to an individual by a public authority or private lender

to assist the individual to pay for tuition, books, and living expenses in order to attend a post-

secondary institution of higher learning.

     (132) “Rhode Island-based employer” means (i) an employer having a principal place of

business or at least fifty-one percent (51%) of its employees located in this state; or (ii) an employer

registered to conduct business in this state that reported Rhode Island tax liability in the previous

tax year.

     (143) “Fund” refers to the “Stay Invested in RI Wavemaker Fellowship Fund” established

pursuant to § 42-64.26-4.

     SECTION 14. Section 42-64.26-12 of the General Laws in Chapter 42-64.26 entitled “Stay

Invested in RI Wavemaker Fellowship” is hereby amended to read as follows:

     42-64.26-12. Sunset.

     No incentives or credits shall be authorized pursuant to this chapter after December 31,

2023June 30, 2020.

     SECTION 15. Section 42-64.27-6 of the General Laws in Chapter 42-64.27 entitled “Main

Street Rhode Island Streetscape Improvement Fund” is hereby amended as follows:

     42-64.27-6. Sunset.

     No incentives shall be authorized pursuant to this chapter after December 31, 2023June 30,

2020.

     SECTION 16. Section 42-64.28-10 of the General Laws in Chapter 42-64.28 entitled

“Innovation Initiative” is hereby amended as follows:

     42-64.28-10. Sunset.

     No vouchers, grants, or incentives shall be authorized pursuant to this chapter after

December 31, 2023June 30, 2020.

     SECTION 17. Section 42-64.29-8 of the General Laws in Chapter 42-64.29 entitled

“Industry Cluster Grants” is hereby amended as follows:

     42-64.29-8. Sunset.

     No grants or incentives shall be authorized to be reserved pursuant to this chapter after

December 31, 2023June 30, 2020.

     SECTION 18. Section 42-64.31-4 of the General Laws in Chapter 42-64.31 entitled “High

School, College, and Employer Partnerships” is hereby amended as follows:

     42-64.31-4. Sunset.

     No grants shall be authorized pursuant to this chapter after December 31, 2023June 30,

2020.

     SECTION 19. Section 42-64.32-6 of the General Laws in Chapter 42-64.32 entitled “Air

Service Development Fund” is hereby amended as follows:

     42-64.32-6. Sunset.

     No grants, credits, or incentives shall be authorized or authorized to be reserved pursuant

to this chapter after December 31, 2023June 30, 2020.

     SECTION 20. It is hereby enacted as follows:

     42-64.33-1. Legislative findings.

     (a) It is found and declared that:

     (1) Rhode Island is home to a growing economy and municipalities are partners in the

state’s economic growth;

     (2) The state seeks to work in even closer partnership with cities and towns to support

economic development throughout the state;

     (3) The state seeks to serve as resource and partner for best practices and technical

assistance to enable the continued growth of cities and towns;

     (4) Cities and towns have achieved great progress over the past four years through

initiatives such as LEAN programs, e-permitting, and other process improvement programs and

these successes should be built upon and expanded;

     (5) Expanding statewide efforts in land-assembly and site-preparation is a core

recommendation of the 2015 Brookings report “Rhode Island Innovates”;

     (6) Rhode Island lacks readily developable land and this lack of shovel ready sites can

prevent manufacturers and other firms from locating in Rhode Island.

     (7) Rhode Island can create a national model that integrates economic development

processes across the state in a mutually accountable partnership with cities and towns and Rhode

Island can develop an attractive portfolio of pre-permitted sites.

     (8) This approach is premised upon cities and towns opting in – participating in ways that

are of the greatest value to the local community involved.

     42-64.33-2. Short title.

     This chapter shall be known as "The State and Local Partnership Council Act."

     42-64.33-3. Creation.

     (a) There is authorized, created, and established a public corporation of the state having a

distinct legal existence from the state and not constituting a department of state government, which

is a governmental agency and public instrumentality of the state, to be known as the "state and local

partnership council" with those powers and purposes that are set forth in this chapter, with the

objectives of providing and promoting and encouraging the preservation, expansion and sound

development of new and existing industry, business, commerce, and related tourism and

recreational facilities, attracting and retaining "high value added" employment opportunities, and

promoting thereby the economic development of the state and the general welfare of its citizens.

     (b) The exercise by the council of the powers conferred by this chapter shall be deemed

and held to be the performance of an essential governmental function of the state for public

purposes. It is the intent of the general assembly by the passage of this chapter to vest in the council

all powers, authority, rights, privileges, and titles which may be necessary to enable it to accomplish

the purposes herein set forth, and this chapter and the powers granted hereby shall be liberally

construed in conformity with those purposes.

     (c) The council and its corporate existence shall continue until terminated by law or until

the council shall cease entirely and continuously to conduct or be involved in any business

whatsoever in furtherance of its purposes; provided, that no termination shall take effect, so long

as the council shall have bonds, notes, or other obligations outstanding, unless adequate provision

shall have been made for the payment thereof pursuant to the documents securing the obligations

or to the terminating law. Upon termination of the existence of the council, all of its rights and

properties shall pass to and be vested in the commerce corporation, established pursuant to chapter

64 of this title, or its successor or, if the commerce corporation is terminated and there is no

successor, in the state. At no time shall the assets or other property of the council inure to the benefit

of any person or other corporation or entity.

     42-64.33-4. Purposes.

     The council is authorized and established to carry out the program for the following

purposes:

     (a) To foster and maintain strong collaborations with municipalities in the state.

     (b) To provide all manner of support and assistance to municipalities in order to foster

economic development in Rhode Island .

     (c) To promote site readiness in the state, including developing an inventory of vetted, pad-

ready sites in the state capable of supporting economic development and establishing a professional

capacity to develop, manage, and market lands to foster economic development in Rhode Island.

     (d) To establish, implement, and maintain high standards for design, improvement,

operation, and use of property in order to provide sites and related amenities for high quality

businesses that create high value-added jobs in Rhode Island.

     (e) To plan, construct, reconstruct, rehabilitate, alter, improve, develop, maintain, operate

and/or acquire or convey any parcels, tracts, areas or projects within participating municipalities.

     42-64.33-5. Definitions.

     (a) As used in this chapter, words and terms, shall have the meaning set forth in § 42-64-3

unless this chapter provides a different meaning or unless the context indicates a different meaning

or intent.

     (b) Within this chapter, the following words and terms shall have the following meanings

unless the context indicates a different meaning or intent:

     (1) "Board" means the board of directors of the state and local partnership council.

     (2) "Chairperson" means the chair of the board of the state and local partnership council.

     (3) “Council” means the state and local partnership council.

     (4) “Program” means the state and local partnership program to be carried out by the state

and local partnership council consistent with the provisions of this chapter.

     42-64.33-6. Assistance to municipalities.

     (a) Upon appropriate authorization by a municipality regarding participation in the

program, the council is authorized and empowered, in its discretion, to provide all manner of

support and assistance to municipalities in connection with fostering economic development

including, but not limited to, aiding in (i) the preparation, adoption or implementation of laws,

regulations, or processes related to development; and (ii) the planning and development of any

parcels, tracts, areas or projects within the municipality. Notwithstanding state and municipal law

or regulation to the contrary, such authorization, if needed, shall require a single vote of the

governing body of the municipality and the approval of the chief elected official, if any.

     (b) In carrying out the program, the council is authorized and empowered to enter into

contractual agreements with municipalities, which contracts may include, among other things, for

the council to provide all manner of support and assistance to municipalities in connection with

fostering economic development including, but not limited to, aiding in the (i) preparation, adoption

or implementation of laws, regulations, or processes related to development; and (ii) the planning

and development of any parcels, tracts, areas or projects within the municipality; and municipalities

are authorized and empowered, notwithstanding any other law to the contrary, to enter into any

contractual agreements with the council and to do all things necessary to carry out their obligations

under the agreements.

     (c)(1) Notwithstanding anything to the contrary in chapter 64.22 of title 42 of the general

laws or any regulations adopted in connection with the program created under chapter 64.22 of title

42, if a qualifying community or hope community participating in the program grants a qualifying

tax stabilization agreement in connection with a qualifying development project, upon

recommendation by the council to the commerce corporation of eligibility of an enhanced award

and subject to availability of appropriated funds, the commerce corporation may provide a partial

reimbursement of no more than fifty percent (50%) of the qualifying community and/or hope

community's forgone tax revenue. The qualification for reimbursement shall cease upon any

termination or cessation of the underlying tax stabilization agreement or upon exhaustion of funds

appropriated pursuant to this section.

     (2) Terms used in this subsection that are defined in chapter 64.22 of title 42, shall have

the meaning as assigned in chapter 64.22 of title 42.

     (3) The council shall provide no more than five (5) certifications in any calendar year under

this subsection.

     (d) Any department, agency, council, board or other instrumentality of the state shall

cooperate with the council in relation to the implementation, execution and administration of the

program created under this chapter.

     42-64.33-7. General powers.

     (a)(1) Except to the extent inconsistent with any specific provision of this chapter, the

council shall have and may exercise all general powers set forth in this chapter and the following

additional general powers:

     (2) As set forth in § 42-64.10-5, § 42-64.10-6 and necessary or convenient to effect its

purposes; provided, that the council shall exercise the powers enumerated in § 42-64.10-6(c) in its

own name and stead with respect to the program and shall not have the powers set forth in §§ 42-

64.10-6(d), 42-64.10-6(h) and 42-64.10-6(i)(3); and

     (3) To grant, loan or provide other financial assistance in relation to the implementation,

execution or administration of the program.

     42-64.33-8. Regulations.

     The council may adopt implementation guidelines, directives, criteria, rules and

regulations pursuant to § 42-35-1, et seq. as are necessary for the implementation and

administration of the program, including provisions for the imposition of fees or other charges in

relation to the administration of the program.

     42-64.33-9. Site readiness.

     (a) To promote site readiness within the state, the council is authorized and empowered to:

     (1) Develop a comprehensive, expedited permitting process in relation to parcels, tracts or

areas as authorized by a municipality participating in the program or provide support and assistance

consistent with applicable municipal law;

     (2) Develop a pre-permitting process to allow for pre-permitted parcels, tracts or areas as

authorized by a municipality participating in the program or provide support and assistance

consistent with applicable municipal law;

     (3) Issue any and all permits, licenses or other authorizations appropriate to carry-out the

program; and

     (4) Plan, construct, reconstruct, rehabilitate, alter, improve, develop, operate, maintain, any

parcels, tracts, or projects owned by the council or other state instrumentality. To the extent

provided by the authorization for participation of a municipality in the program, such parcels, tracts

and projects shall be exempt from the zoning or other land use ordinances, codes, including

building and fire codes, plans, or regulations of any municipality or political subdivision. Parcels,

tracts, areas or projects which are planned, constructed, reconstructed, rehabilitated, altered,

improved, or developed by the council in accordance with the exemption provisions of this

subsection may be maintained and operated by lessees from and successors in interest to the council

in the same manner as if such parcel, tract, area or project had been in existence prior to the

enactment of the zoning or other land use ordinances, codes, plans, or regulations which, but for

this chapter, would otherwise be applicable.

     (6) Notwithstanding any provision in this chapter to the contrary, in those instances in

which the department of environmental management exercises a permitting or licensing function

under the delegated authority of federal law, including, but not limited to, the Federal Clean Water

Act (33 U.S.C. § 1251 et seq.), the Resource Conservation and Recovery Act (42 U.S.C. § 6901 et

seq.), the Clean Air Act (42 U.S.C. § 7401 et seq.), Coastal Zone Management Act of 1972 (16

U.S.C. § 1451 et seq.), and those state laws and regulations which implement those federal laws,

the department of environmental management shall be the licensing and permitting authority.

Further, notwithstanding any provision in this chapter to the contrary, in those instances in which

the coastal resources management council exercises a permitting, licensing or other regulatory

function under the delegated authority of federal law, including, but not limited to, the Coastal Zone

Management Act (16 U.S.C. § 1451 et seq.), and those state laws and regulations which implement

those federal laws, the coastal resources management council shall be the licensing, permitting and

regulatory authority. Moreover, the authority of the department of environmental management and

the coastal resources management council authorities under state law, including but not limited to

issuing licenses and permits delegated to the department of environmental management pursuant

to chapter 1 of title 2 and to the coastal resources management council pursuant to chapter 23 of

title 46, shall remain with those agencies.

     (c) The council shall, in planning, constructing, reconstructing, rehabilitating, altering, or

improving any parcel, tract, area or project, comply with all requirements of federal laws, codes,

or regulations applicable to that planning, construction, reconstruction, rehabilitation, alteration, or

improvement. Except as otherwise specifically provided to the contrary in the authorization

allowing participation by a municipality in the program or a contract entered into between the

council and such municipality pursuant to § 42-64.33-5(b) of this section, no municipality or other

political subdivision of the state shall have the power to modify or change in whole or in part the

drawings, plans, or specifications for any parcel, tract, area or project adopted by the council; nor

to require that any person, firm, or council employed with respect to that parcel, tract, area or project

perform work in any other or different manner than that provided by those drawings, plans, and

specifications; nor to require that any such person, firm, or council obtain any approval, permit, or

certificate from the municipality or political subdivision in relation to the parcel, tract, area or

project; and the doing of that work by any person, firm, or council in accordance with the terms of

those drawings, plans, specifications, or contracts shall not subject the person, firm, or council to

any civil liability or penalty, other than as may be stated in the contracts or may be incidental to the

proper enforcement thereof; nor shall any municipality or political subdivision have the power to

require the council, or any lessee or successor in interest, to obtain any approval, permit, or

certificate from the municipality or political subdivision as a condition of owning, using,

maintaining, operating, or occupying any parcel, tract, area or project acquired, constructed,

reconstructed, rehabilitated, altered, or improved by the council or pursuant to drawings, plans, and

specifications made or approved by the council; provided, however, that nothing contained in this

subsection shall be deemed to relieve any person, firm, or council from the necessity of obtaining

from any municipality or other political subdivision of the state any license which, but for the

provisions of this chapter, would be required in connection with the rendering of personal services

or sale at retail of tangible personal property.

     (f) Except to the extent that the council shall expressly otherwise agree, a municipality or

political subdivision, including, but not limited to, a county, city, town, or district, in which a

project of the council is located, shall provide for the project, whether then owned by the council

or any successor in interest, police, fire, sanitation, health protection, and other municipal services

of the same character and to the same extent as those provided for other residents of that

municipality or political subdivision, but nothing contained in this section shall be deemed to

require any municipality or political subdivision to make capital expenditures for the sole purpose

of providing any of these services for that project.

     42-64.33-10. Directors, officers and employees.

     (a)(1) Directors. The powers of the council shall be vested in a board of directors consisting

of nine (9) members. The membership of the board shall consist of the chief executive officer of

the Rhode Island commerce corporation as chairperson, (who shall vote only in the event of a tie),

and eight (8) members appointed by the governor. The initial members of the board appointed by

the governor shall be divided into three (3) classes and shall serve initial terms on the board of

directors as follows: three (3) of the directors shall be appointed for an initial term of one year;

three (3) of the directors, shall be appointed for an initial term of two (2) years; and two (2) of the

directors shall be appointed for an initial term of three (3) years. Upon expiration of each initial

term and upon the expiration of each term thereafter, a successor shall be appointed by the governor,

to serve for a term of three (3) years so that members of the board of directors shall serve for

staggered terms of three (3) years each. Two (2) members of the board shall be representatives of

the municipalities of Rhode Island. A vacancy on the board, other than by expiration, shall be filled

in the same manner as an original appointment, but only for the unexpired portion of the term. A

member shall be eligible to succeed himself or herself. Appointed directors shall not serve more

than two (2) successive three (3) year terms but may be reappointed after not being a director for a

period of at least twelve (12) months. Each appointed director shall hold office for the term for

which the director is appointed and until the director's successor shall have been appointed and

qualified, or until the director's earlier death, resignation or removal.

     (2) The directors shall receive no compensation for the performance of their duties under

this chapter, but each director shall be reimbursed for his or her reasonable expenses incurred in

carrying out those duties. A director may engage in private employment, or in a profession or

business.

     (3) Regular meetings of the directors shall be held at least once in each calendar quarter, at

the call of the chairperson or secretary, or in accordance with an annual schedule of meetings

adopted by the board. Special meetings may be called for any purposes by the chairperson or the

secretary and as provided for in the bylaws of the council.

     (4) A majority of the directors then in office, but not less than three (3) directors, shall

constitute a quorum, and any action to be taken by the council under the provisions of this chapter,

may be authorized by resolution approved by a majority of the directors present and entitled to a

vote at any regular or special meeting at which a quorum is present. A vacancy in the membership

of the board of directors shall not impair the right of a quorum to exercise all of the rights and

perform all of the duties of the council. Any action taken by the council under the provisions of this

chapter may be authorized by a vote at any regular or special meeting, and each vote shall take

effect immediately, unless otherwise provided in the vote or approving resolution of the board.

     (b) Officers. The officers of the council shall include a chairperson, a secretary, and such

other officers as the board may from time to time establish.

     (1) Chairperson. The governor shall appoint the chairperson of the board who shall, with

the concurrence of the board, appoint committee members, and preside at meetings of the board.

     (2) Presiding Officer. The chairperson shall, from time to time, designate a presiding

officer from amongst the members of the board who shall preside at a given meeting in the absence

of the chairperson.

     (3) Other officers. The board shall appoint a secretary, the duties of whom shall be

prescribed in the bylaws of the council.

     (4) With the exception of the chairperson, any number of offices may be held by the same

person, unless the bylaws provide otherwise.

     42-64.33-11. Liability of the Council.

     The council is, subject to the period of limitations set forth in § 9-1-25, liable in actions of

tort only to the extent that those actions do not arise from the performance of any functions found

or deemed to be essential or discretionary governmental functions. Any recovery in an action or

any recovery by any person in one or more of any actions against the council, its directors,

employees, or agents, shall not exceed one hundred thousand dollars ($100,000) per plaintiff in the

absence of fraud or willful misconduct. In the absence of fraud or willful misconduct, the directors

are not personally liable to any party on account of any action (whether tort or otherwise) arising

from or related to the manner or terms of the disposition of the council's assets, nor shall the manner

or terms of the disposition constitute a defense to any obligation owed to the council.

     42-64.33-12. Compliance.

     The council shall comply with the following laws:

     (a) Code of ethics, chapter 14 of title 36;

     (b) Opening meetings, chapter 46 of this title;

     (c) Access to public records, chapter 2 of title 38;

     (d) Administrative procedures, chapter 35 of this title; and

     (e) Governance and financial management of quasi-public corporations, as provided in

chapter 18 of title 35 with regard to obligations, financing leases, and guarantees and chapter 2 of

title 37 with regard to purchasing principles, policies, and practices, and by §§ 35-3-17.1, 35-6-37,

35-7-13, 35-7-14, 35-20-6, 35-20-9, 42-11.3-2 and 42-11.3-4(A).

     42-64.33-13. Consistency with other statutes.

     (a) The Rhode Island Commerce Corporation Act. Except as otherwise expressly provided

by this chapter, the council shall have the powers necessary to accomplish the purposes set forth in

chapter 64 of this title. The council shall be, in the manner set forth in this chapter, a subsidiary of

the commerce corporation notwithstanding the requirements of § 42-64-7.1, and this chapter shall

be deemed fully satisfactory for purposes of § 42-64-7.1 as necessary to effectuate the provisions

of this chapter.

     (b) Other state laws. Nothing contained in this chapter shall restrict or limit the powers of

the council arising under any laws of this state except where those powers are expressly contrary

to the provisions of this chapter; provided, however, that the council shall not have any power to

create, empower, or otherwise establish any corporation, subsidiary corporation, corporate body,

any form of partnership, or any other separate entity, without the express approval and authorization

of the general assembly. Except as otherwise provided, this chapter shall be construed to provide a

complete additional and alternative method for doing the things authorized hereby and shall be

regarded as supplemental and in addition to the powers conferred by other laws.

     42-64.33-14. Inconsistent provisions.

     Insofar as the provisions of this chapter are inconsistent with the provisions of any other

law or ordinance, general, special or local, the provisions of this chapter shall be controlling.

     42-64.33-15. Construction – Liberal construction.

     This chapter, being necessary for the welfare of the state and its inhabitants, shall be

liberally construed so as to effectuate its purposes.

     42-64.33-16. Severability.

     If any clause, sentence, paragraph, section, or part of this chapter shall be adjudged by any

court of competent jurisdiction to be invalid, that judgment shall not affect, impair, or invalidate

the remainder of the chapter but shall be confined in its operation to the clause, sentence, paragraph,

section, or part directly involved in the controversy in which that judgment shall have been

rendered.

     42-64.33-17. Reporting requirements.

     The council shall publish a report summarizing municipality participation in the program

within sixty (60) days after the end of each fiscal year. The report shall contain information on the

commitment, disbursement, and use of funds expended by the council in relation to assistance to

municipalities.

     SECTION 21. Section 44-11-11 of the General Laws in Chapter 44-11 entitled "Business

Corporation Tax" is hereby amended to read as follows:

     44-11-11. "Net income" defined.

     (a)(1) “Net income” means, for any taxable year and for any corporate taxpayer, the taxable

income of the taxpayer for that taxable year under the laws of the United States, plus:

     (i) Any interest not included in the taxable income;

     (ii) Any specific exemptions;

     (iii) The tax imposed by this chapter; and minus

     (iv) Interest on obligations of the United States or its possessions, and other interest exempt

from taxation by this state; and

     (v) The federal net operating loss deduction.

     (2) All binding federal elections made by or on behalf of the taxpayer applicable either

directly or indirectly to the determination of taxable income shall be binding on the taxpayer except

where this chapter or its attendant regulations specifically modify or provide otherwise. Rhode

Island taxable income shall not include the "gross-up of dividends" required by the federal Internal

Revenue Code to be taken into taxable income in connection with the taxpayer's election of the

foreign tax credit.

     (b) A net operating loss deduction shall be allowed which shall be the same as the net

operating loss deduction allowed under 26 U.S.C. § 172, except that:

     (1) Any net operating loss included in determining the deduction shall be adjusted to reflect

the inclusions and exclusions from entire net income required by subsection (a) of this section and

§ 44-11-11.1;

     (2) The deduction shall not include any net operating loss sustained during any taxable year

in which the taxpayer was not subject to the tax imposed by this chapter; and

     (3) The deduction shall not exceed the deduction for the taxable year allowable under 26

U.S.C. § 172; provided, that the deduction for a taxable year may not be carried back to any other

taxable year for Rhode Island purposes but shall only be allowable on a carry forward basis for the

five (5) succeeding taxable years.

     (c) “Domestic international sales corporations” (referred to as DISCs), for the purposes of

this chapter, will be treated as they are under federal income tax law and shall not pay the amount

of the tax computed under § 44-11-2(a). Any income to shareholders of DISCs is to be treated in

the same manner as it is treated under federal income tax law as it exists on December 31, 1984.

     (d) A corporation which qualifies as a “foreign sales corporation” (FSC) under the

provisions of subchapter N, 26 U.S.C. § 861 et seq., and which has in effect for the entire taxable

year a valid election under federal law to be treated as a FSC, shall not pay the amount of the tax

computed under § 44-11-2(a). Any income to shareholders of FSCs is to be treated in the same

manner as it is treated under federal income tax law as it exists on January 1, 1985.

     (e) For purposes of a corporation’s state tax liability, any deduction to income allowable

under 26 U.S.C. 1400Z-2(c) may be claimed in the case of any investment held by the taxpayer for

at least seven years. The division of taxation shall promulgate, in its discretion, rules and

regulations relative to the accelerated application of deductions under 12 U.S.C. 1400Z-2(c).

     SECTION 22. Section 44-30-2.6 of the General Laws in Chapter 44-30 entitled "Personal

Income Tax" is hereby amended to read as follows:

     44-30-2.6. Rhode Island taxable income -- Rate of tax.

     (a) "Rhode Island taxable income" means federal taxable income as determined under the

Internal Revenue Code, 26 U.S.C. § 1 et seq., not including the increase in the basic, standard-

deduction amount for married couples filing joint returns as provided in the Jobs and Growth Tax

Relief Reconciliation Act of 2003 and the Economic Growth and Tax Relief Reconciliation Act of

2001 (EGTRRA), and as modified by the modifications in § 44-30-12.

     (b) Notwithstanding the provisions of §§ 44-30-1 and 44-30-2, for tax years beginning on

or after January 1, 2001, a Rhode Island personal income tax is imposed upon the Rhode Island

taxable income of residents and nonresidents, including estates and trusts, at the rate of twenty-five

and one-half percent (25.5%) for tax year 2001, and twenty-five percent (25%) for tax year 2002

and thereafter of the federal income tax rates, including capital gains rates and any other special

rates for other types of income, except as provided in § 44-30-2.7, which were in effect immediately

prior to enactment of the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA);

provided, rate schedules shall be adjusted for inflation by the tax administrator beginning in taxable

year 2002 and thereafter in the manner prescribed for adjustment by the commissioner of Internal

Revenue in 26 U.S.C. § 1(f). However, for tax years beginning on or after January 1, 2006, a

taxpayer may elect to use the alternative flat tax rate provided in § 44-30-2.10 to calculate his or

her personal income tax liability.

     (c) For tax years beginning on or after January 1, 2001, if a taxpayer has an alternative

minimum tax for federal tax purposes, the taxpayer shall determine if he or she has a Rhode Island

alternative minimum tax. The Rhode Island alternative minimum tax shall be computed by

multiplying the federal tentative minimum tax without allowing for the increased exemptions under

the Jobs and Growth Tax Relief Reconciliation Act of 2003 (as redetermined on federal form 6251

Alternative Minimum Tax-Individuals) by twenty-five and one-half percent (25.5%) for tax year

2001, and twenty-five percent (25%) for tax year 2002 and thereafter, and comparing the product

to the Rhode Island tax as computed otherwise under this section. The excess shall be the taxpayer's

Rhode Island alternative minimum tax.

     (1) For tax years beginning on or after January 1, 2005, and thereafter, the exemption

amount for alternative minimum tax, for Rhode Island purposes, shall be adjusted for inflation by

the tax administrator in the manner prescribed for adjustment by the commissioner of Internal

Revenue in 26 U.S.C. § 1(f).

     (2) For the period January 1, 2007, through December 31, 2007, and thereafter, Rhode

Island taxable income shall be determined by deducting from federal adjusted gross income as

defined in 26 U.S.C. § 62 as modified by the modifications in § 44-30-12 the Rhode Island

itemized-deduction amount and the Rhode Island exemption amount as determined in this section.

     (A) Tax imposed.

     (1) There is hereby imposed on the taxable income of married individuals filing joint

returns and surviving spouses a tax determined in accordance with the following table:

If taxable income is: The tax is:

Not over $53,150 3.75% of taxable income

Over $53,150 but not over $128,500 $1,993.13 plus 7.00% of the excess over $53,150

Over $128,500 but not over $195,850 $7,267.63 plus 7.75% of the excess over $128,500

Over $195,850 but not over $349,700 $12,487.25 plus 9.00% of the excess over $195,850

Over $349,700 $26,333.75 plus 9.90% of the excess over $349,700

     (2) There is hereby imposed on the taxable income of every head of household a tax

determined in accordance with the following table:

If taxable income is: The tax is:

Not over $42,650 3.75% of taxable income

Over $42,650 but not over $110,100 $1,599.38 plus 7.00% of the excess over $42,650

Over $110,100 but not over $178,350 $6,320.88 plus 7.75% of the excess over $110,100

Over $178,350 but not over $349,700 $11,610.25 plus 9.00% of the excess over $178,350

Over $349,700 $27,031.75 plus 9.90% of the excess over $349,700

     (3) There is hereby imposed on the taxable income of unmarried individuals (other than

surviving spouses and heads of households) a tax determined in accordance with the following

table:

If taxable income is: The tax is:

Not over $31,850 3.75% of taxable income

Over $31,850 but not over $77,100 $1,194.38 plus 7.00% of the excess over $31,850

Over $77,100 but not over $160,850 $4,361.88 plus 7.75% of the excess over $77,100

Over $160,850 but not over $349,700 $10,852.50 plus 9.00% of the excess over $160,850

Over $349,700 $27,849.00 plus 9.90% of the excess over $349,700

     (4) There is hereby imposed on the taxable income of married individuals filing separate

returns and bankruptcy estates a tax determined in accordance with the following table:

If taxable income is: The tax is:

Not over $26,575 3.75% of taxable income

Over $26,575 but not over $64,250 $996.56 plus 7.00% of the excess over $26,575

Over $64,250 but not over $97,925 $3,633.81 plus 7.75% of the excess over $64,250

Over $97,925 but not over $174,850 $6,243.63 plus 9.00% of the excess over $97,925

Over $174,850 $13,166.88 plus 9.90% of the excess over $174,850

     (5) There is hereby imposed a taxable income of an estate or trust a tax determined in

accordance with the following table:

If taxable income is: The tax is:

Not over $2,150 3.75% of taxable income

Over $2,150 but not over $5,000 $80.63 plus 7.00% of the excess over $2,150

Over $5,000 but not over $7,650 $280.13 plus 7.75% of the excess over $5,000

Over $7,650 but not over $10,450 $485.50 plus 9.00% of the excess over $7,650

Over $10,450 $737.50 plus 9.90% of the excess over $10,450

     (6) Adjustments for inflation.

     The dollars amount contained in paragraph (A) shall be increased by an amount equal to:

     (a) Such dollar amount contained in paragraph (A) in the year 1993, multiplied by;

     (b) The cost-of-living adjustment determined under section (J) with a base year of 1993;

     (c) The cost-of-living adjustment referred to in subparagraphs (a) and (b) used in making

adjustments to the nine percent (9%) and nine and nine tenths percent (9.9%) dollar amounts shall

be determined under section (J) by substituting "1994" for "1993."

     (B) Maximum capital gains rates.

     (1) In general.

     If a taxpayer has a net capital gain for tax years ending prior to January 1, 2010, the tax

imposed by this section for such taxable year shall not exceed the sum of:

     (a) 2.5 % of the net capital gain as reported for federal income tax purposes under section

26 U.S.C. § 1(h)(1)(a) and 26 U.S.C. § 1(h)(1)(b).

     (b) 5% of the net capital gain as reported for federal income tax purposes under 26 U.S.C.

§ 1(h)(1)(c).

     (c) 6.25% of the net capital gain as reported for federal income tax purposes under 26

U.S.C. § 1(h)(1)(d).

     (d) 7% of the net capital gain as reported for federal income tax purposes under 26 U.S.C.

§ 1(h)(1)(e).

     (2) For tax years beginning on or after January 1, 2010, the tax imposed on net capital gain

shall be determined under subdivision 44-30-2.6(c)(2)(A).

     (C) Itemized deductions.

     (1) In general.

     For the purposes of section (2), "itemized deductions" means the amount of federal

itemized deductions as modified by the modifications in § 44-30-12.

     (2) Individuals who do not itemize their deductions.

     In the case of an individual who does not elect to itemize his deductions for the taxable

year, they may elect to take a standard deduction.

     (3) Basic standard deduction.

     The Rhode Island standard deduction shall be allowed in accordance with the following

table:

Filing status Amount

Single $5,350

Married filing jointly or qualifying widow(er) $8,900

Married filing separately $4,450

Head of Household $7,850

     (4) Additional standard deduction for the aged and blind. An additional standard deduction

shall be allowed for individuals age sixty-five (65) or older or blind in the amount of $1,300 for

individuals who are not married and $1,050 for individuals who are married.

     (5) Limitation on basic standard deduction in the case of certain dependents.

     In the case of an individual to whom a deduction under section (E) is allowable to another

taxpayer, the basic standard deduction applicable to such individual shall not exceed the greater of:

     (a) $850;

     (b) The sum of $300 and such individual's earned income;

     (6) Certain individuals not eligible for standard deduction.

     In the case of:

     (a) A married individual filing a separate return where either spouse itemizes deductions;

     (b) Nonresident alien individual;

     (c) An estate or trust;

     The standard deduction shall be zero.

     (7) Adjustments for inflation.

     Each dollar amount contained in paragraphs (3), (4) and (5) shall be increased by an amount

equal to:

     (a) Such dollar amount contained in paragraphs (3), (4) and (5) in the year 1988, multiplied

by

     (b) The cost-of-living adjustment determined under section (J) with a base year of 1988.

     (D) Overall limitation on itemized deductions.

     (1) General rule.

     In the case of an individual whose adjusted gross income as modified by § 44-30-12

exceeds the applicable amount, the amount of the itemized deductions otherwise allowable for the

taxable year shall be reduced by the lesser of:

     (a) Three percent (3%) of the excess of adjusted gross income as modified by § 44-30-12

over the applicable amount; or

     (b) Eighty percent (80%) of the amount of the itemized deductions otherwise allowable for

such taxable year.

     (2) Applicable amount.

     (a) In general.

     For purposes of this section, the term "applicable amount" means $156,400 ($78,200 in the

case of a separate return by a married individual)

     (b) Adjustments for inflation.

     Each dollar amount contained in paragraph (a) shall be increased by an amount equal to:

     (i) Such dollar amount contained in paragraph (a) in the year 1991, multiplied by

     (ii) The cost-of-living adjustment determined under section (J) with a base year of 1991.

     (3) Phase-out of Limitation.

     (a) In general.

     In the case of taxable year beginning after December 31, 2005, and before January 1, 2010,

the reduction under section (1) shall be equal to the applicable fraction of the amount which would

be the amount of such reduction.

     (b) Applicable fraction.

     For purposes of paragraph (a), the applicable fraction shall be determined in accordance

with the following table:

For taxable years beginning in calendar year The applicable fraction is

2006 and 2007 2/3

2008 and 2009 1/3

     (E) Exemption amount.

     (1) In general.

     Except as otherwise provided in this subsection, the term "exemption amount" means

$3,400.

     (2) Exemption amount disallowed in case of certain dependents.

     In the case of an individual with respect to whom a deduction under this section is allowable

to another taxpayer for the same taxable year, the exemption amount applicable to such individual

for such individual's taxable year shall be zero.

     (3) Adjustments for inflation.

     The dollar amount contained in paragraph (1) shall be increased by an amount equal to:

     (a) Such dollar amount contained in paragraph (1) in the year 1989, multiplied by

     (b) The cost-of-living adjustment determined under section (J) with a base year of 1989.

     (4) Limitation.

     (a) In general.

     In the case of any taxpayer whose adjusted gross income as modified for the taxable year

exceeds the threshold amount shall be reduced by the applicable percentage.

     (b) Applicable percentage.

     In the case of any taxpayer whose adjusted gross income for the taxable year exceeds the

threshold amount, the exemption amount shall be reduced by two (2) percentage points for each

$2,500 (or fraction thereof) by which the taxpayer's adjusted gross income for the taxable year

exceeds the threshold amount. In the case of a married individual filing a separate return, the

preceding sentence shall be applied by substituting "$1,250" for "$2,500." In no event shall the

applicable percentage exceed one hundred percent (100%).

     (c) Threshold Amount.

     For the purposes of this paragraph, the term "threshold amount" shall be determined with

the following table:

Filing status Amount

Single $156,400

Married filing jointly of qualifying widow(er) $234,600

Married filing separately $117,300

Head of Household $195,500

     (d) Adjustments for inflation.

     Each dollar amount contained in paragraph (b) shall be increased by an amount equal to:

     (i) Such dollar amount contained in paragraph (b) in the year 1991, multiplied by

     (ii) The cost-of-living adjustment determined under section (J) with a base year of 1991.

     (5) Phase-out of limitation.

     (a) In general.

     In the case of taxable years beginning after December 31, 2005, and before January 1,

2010, the reduction under section 4 shall be equal to the applicable fraction of the amount which

would be the amount of such reduction.

     (b) Applicable fraction.

     For the purposes of paragraph (a), the applicable fraction shall be determined in accordance

with the following table:

For taxable years beginning in calendar year The applicable fraction is

2006 and 2007 2/3

2008 and 2009 1/3

     (F) Alternative minimum tax.

     (1) General rule. There is hereby imposed (in addition to any other tax imposed by this

subtitle) a tax equal to the excess (if any) of:

     (a) The tentative minimum tax for the taxable year, over

     (b) The regular tax for the taxable year.

     (2) The tentative minimum tax for the taxable year is the sum of:

     (a) 6.5 percent of so much of the taxable excess as does not exceed $175,000, plus

     (b) 7.0 percent of so much of the taxable excess above $175,000.

     (3) The amount determined under the preceding sentence shall be reduced by the alternative

minimum tax foreign tax credit for the taxable year.

     (4) Taxable excess. For the purposes of this subsection the term "taxable excess" means so

much of the federal alternative minimum taxable income as modified by the modifications in § 44-

30-12 as exceeds the exemption amount.

     (5) In the case of a married individual filing a separate return, subparagraph (2) shall be

applied by substituting "$87,500" for $175,000 each place it appears.

     (6) Exemption amount.

     For purposes of this section "exemption amount" means:

Filing status Amount

Single $39,150

Married filing jointly or qualifying widow(er) $53,700

Married filing separately $26,850

Head of Household $39,150

Estate or trust $24,650

     (7) Treatment of unearned income of minor children

     (a) In general.

     In the case of a minor child, the exemption amount for purposes of section (6) shall not

exceed the sum of:

     (i) Such child's earned income, plus

     (ii) $6,000.

     (8) Adjustments for inflation.

     The dollar amount contained in paragraphs (6) and (7) shall be increased by an amount

equal to:

     (a) Such dollar amount contained in paragraphs (6) and (7) in the year 2004, multiplied by

     (b) The cost-of-living adjustment determined under section (J) with a base year of 2004.

     (9) Phase-out.

     (a) In general.

     The exemption amount of any taxpayer shall be reduced (but not below zero) by an amount

equal to twenty-five percent (25%) of the amount by which alternative minimum taxable income

of the taxpayer exceeds the threshold amount.

     (b) Threshold amount.

     For purposes of this paragraph, the term "threshold amount" shall be determined with the

following table:

Filing status Amount

Single $123,250

Married filing jointly or qualifying widow(er) $164,350

Married filing separately $82,175

Head of Household $123,250

Estate or Trust $82,150

     (c) Adjustments for inflation

     Each dollar amount contained in paragraph (9) shall be increased by an amount equal to:

     (i) Such dollar amount contained in paragraph (9) in the year 2004, multiplied by

     (ii) The cost-of-living adjustment determined under section (J) with a base year of 2004.

     (G) Other Rhode Island taxes.

     (1) General rule. There is hereby imposed (in addition to any other tax imposed by this

subtitle) a tax equal to twenty-five percent (25%) of:

     (a) The Federal income tax on lump-sum distributions.

     (b) The Federal income tax on parents' election to report child's interest and dividends.

     (c) The recapture of Federal tax credits that were previously claimed on Rhode Island

return.

     (H) Tax for children under 18 with investment income.

     (1) General rule. There is hereby imposed a tax equal to twenty-five percent

     (25%) of:

     (a) The Federal tax for children under the age of 18 with investment income.

     (I) Averaging of farm income.

     (1) General rule. At the election of an individual engaged in a farming business or fishing

business, the tax imposed in section 2 shall be equal to twenty-five percent (25%) of:

     (a) The Federal averaging of farm income as determined in IRC section 1301 [26 U.S.C. §

1301].

     (J) Cost-of-living adjustment.

     (1) In general.

     The cost-of-living adjustment for any calendar year is the percentage (if any) by which:

     (a) The CPI for the preceding calendar year exceeds

     (b) The CPI for the base year.

     (2) CPI for any calendar year.

     For purposes of paragraph (1), the CPI for any calendar year is the average of the consumer

price index as of the close of the twelve (12) month period ending on August 31 of such calendar

year.

     (3) Consumer price index.

     For purposes of paragraph (2), the term "consumer price index" means the last consumer

price index for all urban consumers published by the department of labor. For purposes of the

preceding sentence, the revision of the consumer price index that is most consistent with the

consumer price index for calendar year 1986 shall be used.

     (4) Rounding.

     (a) In general.

     If any increase determined under paragraph (1) is not a multiple of $50, such increase shall

be rounded to the next lowest multiple of $50.

     (b) In the case of a married individual filing a separate return, subparagraph (a) shall be

applied by substituting "$25" for $50 each place it appears.

     (K) Credits against tax. For tax years beginning on or after January 1, 2001, a taxpayer

entitled to any of the following federal credits enacted prior to January 1, 1996, shall be entitled to

a credit against the Rhode Island tax imposed under this section:

     (1) [Deleted by P.L. 2007, ch. 73, art. 7, § 5].

     (2) Child and dependent care credit;

     (3) General business credits;

     (4) Credit for elderly or the disabled;

     (5) Credit for prior year minimum tax;

     (6) Mortgage interest credit;

     (7) Empowerment zone employment credit;

     (8) Qualified electric vehicle credit.

     (L) Credit against tax for adoption. For tax years beginning on or after January 1, 2006, a

taxpayer entitled to the federal adoption credit shall be entitled to a credit against the Rhode Island

tax imposed under this section if the adopted child was under the care, custody, or supervision of

the Rhode Island department of children, youth and families prior to the adoption.

     (M) The credit shall be twenty-five percent (25%) of the aforementioned federal credits

provided there shall be no deduction based on any federal credits enacted after January 1, 1996,

including the rate reduction credit provided by the federal Economic Growth and Tax

Reconciliation Act of 2001 (EGTRRA). In no event shall the tax imposed under this section be

reduced to less than zero. A taxpayer required to recapture any of the above credits for federal tax

purposes shall determine the Rhode Island amount to be recaptured in the same manner as

prescribed in this subsection.

     (N) Rhode Island earned-income credit .

     (1) In general.

     For tax years beginning before January 1, 2015, a taxpayer entitled to a federal earned-

income credit shall be allowed a Rhode Island earned-income credit equal to twenty-five percent

(25%) of the federal earned-income credit. Such credit shall not exceed the amount of the Rhode

Island income tax.

     For tax years beginning on or after January 1, 2015, and before January 1, 2016, a taxpayer

entitled to a federal earned-income credit shall be allowed a Rhode Island earned-income credit

equal to ten percent (10%) of the federal earned-income credit. Such credit shall not exceed the

amount of the Rhode Island income tax.

     For tax years beginning on or after January 1, 2016, a taxpayer entitled to a federal earned-

income credit shall be allowed a Rhode Island earned-income credit equal to twelve and one-half

percent (12.5%) of the federal earned-income credit. Such credit shall not exceed the amount of the

Rhode Island income tax.

     For tax years beginning on or after January 1, 2017, a taxpayer entitled to a federal earned-

income credit shall be allowed a Rhode Island earned-income credit equal to fifteen percent (15%)

of the federal earned-income credit. Such credit shall not exceed the amount of the Rhode Island

income tax.

     (2) Refundable portion.

     In the event the Rhode Island earned-income credit allowed under paragraph (N)(1) of this

section exceeds the amount of Rhode Island income tax, a refundable earned-income credit shall

be allowed as follows.

     (i) For tax years beginning before January 1, 2015, for purposes of paragraph (2) refundable

earned-income credit means fifteen percent (15%) of the amount by which the Rhode Island earned-

income credit exceeds the Rhode Island income tax.

     (ii) For tax years beginning on or after January 1, 2015, for purposes of paragraph (2)

refundable earned-income credit means one hundred percent (100%) of the amount by which the

Rhode Island earned-income credit exceeds the Rhode Island income tax.

     (O) The tax administrator shall recalculate and submit necessary revisions to paragraphs

(A) through (J) to the general assembly no later than February 1, 2010, and every three (3) years

thereafter for inclusion in the statute.

     (3) For the period January 1, 2011, through December 31, 2011, and thereafter, "Rhode

Island taxable income" means federal adjusted gross income as determined under the Internal

Revenue Code, 26 U.S.C. § 1 et seq., and as modified for Rhode Island purposes pursuant to § 44-

30-12 less the amount of Rhode Island Basic Standard Deduction allowed pursuant to subparagraph

44-30-2.6(c)(3)(B), and less the amount of personal exemption allowed pursuant to subparagraph

44-30-2.6(c)(3)(C).

     (A) Tax imposed.

     (I) There is hereby imposed on the taxable income of married individuals filing joint

returns, qualifying widow(er), every head of household, unmarried individuals, married individuals

filing separate returns and bankruptcy estates, a tax determined in accordance with the following

table:

RI Taxable Income RI Income Tax

Over But not over Pay +% on Excess on the amount over

$0 - $ 55,000 $ 0 + 3.75% $0