ARTICLE 27 SUBSTITUTE A
RELATING TO SALES TAX EXEMPTION
WHEREAS, Rhode Island General Laws 42-64-20 authorizes the Rhode Island Economic Development Corporation to engage in projects which are sales tax exempt subject to approval of the General assembly; and
WHEREAS, Rhode Island General Laws 42-64-20.1 establishes the procedure whereby the Rhode Island Economic Development Corporation adopts and submits a request for approval by the General Assembly that includes:
(1) A full description of the project to which the tax exemption is related;
(2) The corporation's findings required by section 42-64-10(a)(1); and
(3) The corporation's analysis of impact required by section 42-64-10(a)(2); and
WHEREAS, The General Assembly, through its finance committees, thoroughly reviews the request for approval submitted by the Economic Development Corporation in order to ensure that the HTP, MED. Inc. project complies with all conditions established by the corporation; and
WHEREAS, The corporation has estimated the number of new full time jobs to be 109, the amount of personal income tax revenue received to be $339,000 over three years, and the estimated loss of sales tax revenue to be $276,500 in FY 2008; and
WHEREAS, The General Assembly must assure that the project is in the best interests of the citizens of Rhode Island prior to approval;
Now, therefore, be it
RESOLVED, Project status is hereby approved for HTP, MED. Inc. subject to the following additional requirements:
The total sales tax exemption benefit identified in the project status request, $276,500, will be implemented through a reimbursement process rather than up-front purchase exemption;
The sales tax benefits granted pursuant to RIGL 42-64-20(c) shall only apply to materials used in the construction, reconstruction or rehabilitation of the project and to the acquisition of furniture, fixtures and equipment, except automobiles, trucks or other motor vehicles for the project for a period not to exceed six (6) months after receipt of a certificate of occupancy for any given phase of the project for which sales tax benefits are utilized.
The corporation shall send the analysis required by RIGL 42-64-10(a)(2) to the house and senate fiscal committee chairs, the house and senate fiscal advisors, the department of labor and training and the division of taxation promptly upon completion. Annually thereafter, the department of labor and training shall certify to the house and senate fiscal committee chairs, the house and senate fiscal advisors, the corporation and the division of taxation that the actual number of new full-time jobs with benefits created by the project, not including construction jobs, is on target to meet or exceed the estimated number of new jobs identified in the analysis above, which in the case of HTP, MED. Inc. is 109 jobs. This certification shall no longer be required when the total amount of new income tax revenue received by the state exceeds the amount of the sales tax exemption benefit granted above. For purposes of this section, "full-time jobs with benefits" means jobs that require working a minimum of thirty (30) hours per week within the state, with a medium wage that exceeds by 5.0% the median annual wage for full-time jobs in Rhode Island or within the lessee's industry, with a benefit package that is typical of companies within the lessee's industry.
The department of labor and training shall certify to the house and senate fiscal committee chairs, the house and senate fiscal advisors, and the division of taxation that jobs created by the project are "new jobs" in the state of Rhode Island, meaning that the employees of the project are in addition to, and without a reduction of, those employees of the lessee currently employed in Rhode Island, are not relocated from another facility of the lessee's in Rhode Island or are employees assumed by the lessee as the result of a merger or acquisition of a company already located in Rhode Island. Additionally, the corporation, with the assistance of the lessee, the department of labor and training, the department of human services and the division of taxation shall provide annually an analysis of whether any of the employees of the project qualify for RIte Care or RIte Share benefits and the impact such benefits or assistance may have on the state budget.
Notwithstanding any other provision of law, the division of taxation, the department of labor and training and the department of human services are authorized to present, review and discuss lessee specific tax or employment information or data with the corporation, the house and senate fiscal committee chairs, and/or the house and senate fiscal advisors for the purpose of verification and compliance with this resolution; and
The corporation and the project lessee shall agree that, if at any time prior to pay back of the amount of the sales tax exemption through new income tax collections, not including construction job income taxes, the lessee will be unable to continue the project, or otherwise defaults on its obligations to the corporation, the lessee shall be liable to the state for all the sales tax benefits granted to the project plus interest, as determined in RIGL 44-1-7, calculated from the date the lessee received the sales tax benefits.