2009 Wisconsin Act 2

2,803 Section 803. Subchapter VI (title) of chapter 560 [precedes 560.70] of the statutes is repealed and recreated to read:

CHAPTER 560

SUBCHAPTER VI
Tax incentives for business
development in Wisconsin

2,804 Section 804. 560.70 (2g) of the statutes is created to read:

560.70 (2g) "Eligible activity" means an activity described under s. 560.702.

2,805 Section 805. 560.70 (2m) of the statutes is renumbered 560.70 (2m) (a) and amended to read:

560.70 (2m) (a) "Full Except as provided in par. (b), "full-time job" means a regular, nonseasonal full-time position in which an individual, as a condition of employment, is required to work at least 2,080 hours per year, including paid leave and holidays, and for which the individual receives pay that is equal to at least 150% of the federal minimum wage and benefits that are not required by federal or state law. "Full-time job" does not include initial training before an employment position begins.

2,806 Section 806. 560.70 (2m) (b) of the statutes is created to read:

560.70 (2m) (b) The department may by rule specify circumstances under which the department may grant exceptions to the requirement under par. (a) that a full-time job means a job in which an individual, as a condition of employment, is required to work at least 2,080 hours per year, but under no circumstances may a full-time job mean a job in which an individual, as a condition of employment, is required to work less than 37.5 hours per week.

2,807 Section 807. 560.70 (4m) of the statutes is created to read:

560.70 (4m) "Member of a targeted group" means a person who resides in an area designated by the federal government as an economic revitalization area, a person who is employed in an unsubsidized job but meets the eligibility requirements under s. 49.145 (2) and (3) for a Wisconsin Works employment position, a person who is employed in a trial job, as defined in s. 49.141 (1) (n), or in a real work, real pay project position under s. 49.147 (3m), a person who is eligible for child care assistance under s. 49.155, a person who is a vocational rehabilitation referral, an economically disadvantaged youth, an economically disadvantaged veteran, a supplemental security income recipient, a general assistance recipient, an economically disadvantaged ex-convict, a dislocated worker, as defined in 29 USC 2801 (9), or a food stamp recipient, if the person has been certified in the manner under 26 USC 51 (d) (13) (A) by a designated local agency, as defined in 26 USC 51 (d) (12).

2,808 Section 808. 560.70 (7) (a) of the statutes is amended to read:

560.70 (7) (a) Except as provided in pars. (b) and, (c), and (d), "tax benefits" means the development zones credit under ss. 71.07 (2dx), 71.28 (1dx), 71.47 (1dx), and 76.636.

2,809 Section 809. 560.70 (7) (d) of the statutes is created to read:

560.70 (7) (d) In ss. 560.701 to 560.706, "tax benefits" means the economic development tax credit under ss. 71.07 (2dy), 71.28 (1dy), 71.47 (1dy), and 76.637.

2,810 Section 810. 560.701 of the statutes is created to read:

560.701 Certification for tax benefits. (1) Application. Any person may apply to the department on a form prepared by the department for certification under this section. The application shall include all of the following:

(a) The name and address of the person.

(b) The federal tax identification number of the person.

(c) The names and addresses of the locations where the person conducts business and a description of the business activities conducted at those locations.

(d) A description of each eligible activity conducted or proposed to be conducted by the person.

(e) Other information required by the department or the department of revenue.

(2) Certification. (a) The department may certify a person who submits an application under sub. (1) if, after conducting an investigation, the department determines that the person is conducting or intends to conduct at least one eligible activity.

(b) The department shall provide a person certified under this section and the department of revenue with a copy of the certification.

(3) Contract. A person certified under this section shall enter into a written contract with the department. The contract shall include provisions that detail all of the following:

(a) A description of each eligible activity being conducted or proposed to be conducted by the person.

(b) Whether any of the eligible activities will occur in an economically distressed area, as designated by the department under s. 560.704 (1).

(c) Whether any of the eligible activities will benefit members of a targeted group, as determined by the department under s. 560.704 (2).

(d) A compliance schedule that includes a sequence of anticipated actions to be taken or goals to be achieved by the person before the person may receive tax benefits under s. 560.703.

(e) The reporting requirements with which the person must comply.

(f) If feasible, a determination of the tax benefits the person will be authorized to claim under s. 560.703 (2) if the person fulfills the terms of the contract.

2,811 Section 811. 560.702 of the statutes is created to read:

560.702 Eligible activities. A person who conducts or proposes to conduct any of the following may be certified under s. 560.701 (2):

(1) Job creation project. A project that creates and maintains for a period of time established by the department by rule full-time jobs in addition to any existing full-time jobs provided by the person.

(2) Capital investment project. A project that involves a significant investment of capital, as defined by the department by rule under s. 560.706 (2) (b), by the person in new equipment, machinery, real property, or depreciable personal property.

(3) Employee training project. A project that involves significant investments in the training or reeducation of employees, as defined by the department by rule under s. 560.706 (2) (c), by the person for the purpose of improving the productivity or competitiveness of the business of the person.

(4) Project related to persons with corporate headquarters in Wisconsin. A project that will result in the location or retention of a person's corporate headquarters in Wisconsin or that will result in the retention of employees holding full-time jobs in Wisconsin if the person's corporate headquarters are located in Wisconsin.

2,812 Section 812. 560.703 of the statutes is created to read:

560.703 Limits on tax benefits and claiming tax benefits. (1) Limits. (a) Except as provided in par. (b), the total tax benefits available to be allocated by the department under ss. 560.701 to 560.706 may not exceed the sum of the tax benefits remaining to be allocated under ss. 560.71 to 560.785, 560.797, 560.798, 560.7995, and 560.96 on the effective date of this paragraph .... [LRB inserts date].

(b) The department may submit to the joint committee on finance a request in writing to exceed the total tax benefits specified in par. (a). The department shall submit with its request a justification for seeking an increase under this paragraph. The joint committee on finance, following its review, may approve or disapprove an increase in the total tax benefits available to be allocated under ss. 560.701 to 560.706.

(2) Authority to claim tax benefits. The department may authorize a person certified under s. 560.701 (2) to claim tax benefits only after the person has submitted a report to the department that documents to the satisfaction of the department that the person has complied with the terms of the contract under s. 560.701 (3) and the requirements of any applicable rules promulgated under s. 560.706 (2).

(3) Notice of eligibility. The department shall provide to the person and to the department of revenue a notice of eligibility to receive tax benefits that reports the amount of tax benefits for which the person is eligible.

2,813 Section 813. 560.704 of the statutes is created to read:

560.704 Eligible activities in economically distressed areas and benefiting members of targeted groups. The department may authorize a person certified under s. 560.701 (2) to claim additional tax benefits under s. 560.703 if, after conducting an investigation, the department determines any of the following:

(1) The person conducts at least one eligible activity in an area designated by the department as economically distressed. In designating an area as economically distressed under this subsection, the department shall follow the methodology established by rule under s. 560.706 (2) (e).

(2) The person conducts at least one eligible activity that benefits, creates, retains, or significantly upgrades full-time jobs for, that trains, or that reeducates, members of a targeted group.

2,814 Section 814. 560.705 of the statutes is created to read:

560.705 Revocation of certification. The department shall revoke the certification of a person who does any of the following:

(1) Supplies false or misleading information to obtain certification under s. 560.701 (2).

(2) Supplies false or misleading information to obtain tax benefits under s. 560.703.

(3) Leaves the state to conduct substantially the same business outside of the state.

(4) Ceases operations in the state and does not renew operation of the business or a similar business within 12 months.

2,815 Section 815. 560.706 of the statutes is created to read:

560.706 Responsibilities of the department. The department shall do all of the following:

(1) Accountability. (a) Annually verify information submitted to the department of revenue under ss. 71.07 (2dy), 71.28 (1dy), 71.47 (1dy), and 76.637 by persons certified under s. 560.701 (2) and eligible to receive tax benefits under s. 560.703.

(b) Notify and obtain written approval from the secretary for any certification under sub. (2) (j).

(2) Rules. Establish by rule all of the following:

(a) A schedule of hourly wage ranges to be paid, and health insurance benefits to be provided, to an employee by a person certified under s. 560.701 (2) and the corresponding per employee tax benefit for which a person certified under s. 560.701 (2) may be eligible.

(b) A definition of "significant investment of capital" for purposes of s. 560.702 (2), together with a corresponding schedule of tax benefits for which a person who is certified under s. 560.701 (2) and who conducts a project described in s. 560.702 (2) may be eligible. The department shall include in the definition required under this paragraph a schedule of investments that takes into consideration the size or nature of the business.

(c) A definition of "significant investments in the training or reeducation of employees" for purposes of s. 560.702 (3), together with a corresponding schedule of tax benefits for which a person who is certified under s. 560.701 (2) and who conducts a project under s. 560.702 (3) may be eligible.

(d) A schedule of tax benefits for which a person who is certified under s. 560.701 (2) and who conducts a project that will result in the location or retention of a person's corporate headquarters in Wisconsin may be eligible.

(e) The methodology for designating an area as economically distressed under s. 560.704 (1). The methodology under this paragraph shall require the department to consider the most current data available for the area and for the state on the following indicators:

1. Unemployment rate.

2. Percentage of families with incomes below the poverty line established under 42 USC 9902 (2).

3. Median family income.

4. Median per capita income.

5. Average annual wage.

6. Real property values.

7. Other significant or irregular indicators of economic distress, such as a natural disaster.

(f) A schedule of additional tax benefits for which a person who is certified under s. 560.701 (2) and who conducts an eligible activity described under s. 560.704 may be eligible.

(g) Reporting requirements, minimum benchmarks, and outcomes expected of a person certified under s. 560.701 (2) before that person may receive tax benefits under s. 560.703.

(h) Policies, criteria, and methodology for allocating a portion of the tax benefits available under s. 560.703 to rural areas.

(i) Policies, criteria, and methodology for allocating a portion of the tax benefits available under s. 560.703 to small businesses.

(j) Policies and criteria for certifying a person who may be eligible for tax benefits greater than or equal to $3,000,000.

(k) Procedures for implementing ss. 560.701 to 560.706.

(3) Reporting. Annually, 6 months after the report has been submitted under s. 560.01 (2) (am), submit to the joint legislative audit committee and to the appropriate standing committees of the legislature under s. 13.172 (3) a comprehensive report assessing the program under ss. 560.701 to 560.706. The report under this subsection shall update the applicable information provided in the report under s. 560.01 (2) (am).

2,816 Section 816. 560.71 (4) of the statutes is created to read:

560.71 (4) No development zone may be designated under this section after the effective date of this subsection .... [LRB inserts date].

2,817 Section 817. 560.737 (4) of the statutes is created to read:

560.737 (4) No premises of a business incubator may be designated as part of a development zone under this section after the effective date of this subsection .... [LRB inserts date].

2,818 Section 818. 560.74 (1) of the statutes is amended to read:

560.74 (1) At Except as provided under sub. (6), at any time after a development zone is designated by the department, a local governing body may submit an application to change the boundaries of the development zone. If the boundary change reduces the size of a development zone, the local governing body shall explain why the area excluded should no longer be in a development zone. The department may require the local governing body to submit additional information.

2,819 Section 819. 560.74 (6) of the statutes is created to read:

560.74 (6) The department may not accept any applications under sub. (1) to change the boundaries of a development zone designated under s. 560.71 on or after the effective date of this subsection .... [LRB inserts date].

2,820 Section 820. 560.745 (1) (b) of the statutes is amended to read:

560.745 (1) (b) The local governing body may apply to the department for one 60-month extension of the designation. The department shall promulgate rules establishing criteria for approving an extension of a designation of an area as a development zone under this subsection. No applications may be accepted by the department under this paragraph on or after the effective date of this paragraph .... [LRB inserts date].

2,821 Section 821. 560.745 (2) (am) of the statutes is amended to read:

560.745 (2) (am) Notwithstanding par. (a), the department may increase the established limit for tax benefits for a development zone. The department may not increase the limit for tax benefits established for any development zone designated under s. 560.71 on or after the effective date of this paragraph .... [LRB inserts date].

2,822 Section 822. 560.78 (1m) of the statutes is created to read: