SB86: Bill Text

1997 Senate BILL 86

February 19, 1997 - Introduced by Senators Grobschmidt, Welch, Wirch, Schultz, Buettner and Burke, cosponsored by Representatives Riley, Green, La Fave, Notestein, Plale, Dobyns, Bock, Duff and Grothman. Referred to Committee on Economic Development, Housing and Government Operations.

SB86,2,2 An Act to repeal 71.07 (2di) (c), 71.07 (2dL) (d), 71.10 (4) (gd), (ge), (gg), (gm), (gr), (gs) and (gt), 71.28 (1di) (c), 71.28 (1dL) (d), 71.30 (3) (eb), (ec), (eg), (em), (en) and (eo), 71.47 (1di) (c), 71.47 (1dL) (d) and 71.49 (1) (eb), (ec), (eg), (em), (en) and (eo); to amend 71.07 (2dd) (c), 71.07 (2de) (a) (intro.), 71.07 (2de) (b), 71.07 (2di) (b) 2., 71.07 (2dj) (h), 71.07 (2dL) (c) 2., 71.07 (2ds) (h), 71.10 (4) (i), 71.28 (1dd) (c), 71.28 (1de) (a) (intro.), 71.28 (1de) (b), 71.28 (1di) (b) 2., 71.28 (1dj) (h), 71.28 (1dL) (c) 2., 71.28 (1ds) (h), 71.30 (3) (f), 71.47 (1dd) (c), 71.47 (1de) (a) (intro.), 71.47 (1de) (b), 71.47 (1di) (b) 2., 71.47 (1dj) (h), 71.47 (1dL) (c) 2., 71.47 (1ds) (h), 71.49 (1) (f), 560.745 (2) (a) and 560.75 (9) (b); to repeal and recreate 71.07 (2dr) (f); and to create 20.835 (2) (co), 20.835 (2) (cp) and 20.835 (2) (cr) of the statutes; relating to: the development zones environmental remediation credit, increasing the total tax benefits limit under the development zone program and making an appropriation.

Analysis by the Legislative Reference Bureau

Under current law, taxpayers may claim an income tax or franchise tax credit for 7.5% of the amount expended for environmental remediation in a development zone or an enterprise development zone. This bill increases the percentage to 33%.

Under current law all development zones tax credits, except the research credit, which is available only to individuals, are refundable (a check is issued if the amount of the credit exceeds the amount of tax due) if the claimant is located on an Indian reservation and is an American Indian, on Indian business or a tribal enterprise. Under this bill, all development zones tax credits are refundable regardless of the claimant.

Under the development zone program, which is administered by the department of commerce, a person conducting economic activity in an area that has been designated as a development zone may claim certain tax benefits. The department of commerce must allocate to each area that is designated as a development zone the total amount of tax benefits that may be claimed by persons conducting economic activity in the area. The amount that is allocated is a portion of the total tax benefits that may be claimed under the entire program. Under current law, $28,155,000 may be claimed in tax benefits under the entire program. The bill increases this amount to $40,000,000 and specifies that of this amount at least $3,000,000 must be allocated to development zones that are located in a 1st class city.

Also under current law, 65% of the tax benefits in a development zone that is located in a 1st class city must be used for development zones jobs credits. The bill excludes tax benefits used for development zones environmental remediation credits from the total tax benefits upon which the percentage is based.

For further information see the state fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

SB86, s. 1 Section 1. 20.835 (2) (co) of the statutes is created to read:

SB86,2,6 20.835 (2) (co) Development zones environmental remediation tax credit. A sum sufficient to make the payments under ss. 71.07 (2de) (b), 71.28 (1de) (b) and 71.47 (1de) (b).

SB86, s. 2 Section 2. 20.835 (2) (cp) of the statutes is created to read:

SB86,3,2 20.835 (2) (cp) Development zones day care credit. A sum sufficient to make the payments under ss. 71.07 (2dd) (c), 71.28 (1dd) (c) and 71.47 (1dd) (c).

SB86, s. 3 Section 3. 20.835 (2) (cr) of the statutes is created to read:

SB86,3,5 20.835 (2) (cr) Development zones research credit. A sum sufficient to make the payments under s. 71.07 (2dr).

SB86, s. 4 Section 4. 71.07 (2dd) (c) of the statutes is amended to read:

SB86,3,8 71.07 (2dd) (c) Subsection (2di) (b), (c), (d) 1., (f) and (g), as it applies to the credit under sub. (2di), applies to the credit under this subsection.

SB86, s. 5 Section 5. 71.07 (2de) (a) (intro.) of the statutes is amended to read:

SB86,3,18 71.07 (2de) (a) (intro.) Except as provided in s. 73.03 (35), for any taxable year for which a person is certified under s. 560.765 (3) and begins business operations in a zone under s. 560.71 after July 29, 1995, or certified under s. 560.797 (4) (a), for each zone for which the person is certified or entitled the person may claim as a credit against taxes otherwise due under this subchapter an amount equal to 7.5% 33% of the amount that the person expends to remove or contain environmental pollution, as defined in s. 299.01 (4), in the zone or to restore soil or groundwater that is affected by environmental pollution, as defined in s. 299.01 (4), in the zone if the person fulfills all of the following requirements:

SB86, s. 6 Section 6. 71.07 (2de) (b) of the statutes is amended to read:

SB86,3,21 71.07 (2de) (b) Subsection (2di) (b), (c), (d), (f) and (g), as it applies to the credit under sub. (2di), applies to the credit under this subsection.

SB86, s. 7 Section 7. 71.07 (2di) (b) 2. of the statutes is amended to read:

SB86,4,8 71.07 (2di) (b) 2. If the claimant is located on an Indian reservation, as defined in s. 560.86 (5), and is an American Indian, as defined in s. 560.86 (1), an Indian business, as defined in s. 560.86 (4), or a tribal enterprise, and if the allowable amount of the credit under this subsection exceeds the taxes otherwise due under this chapter on or measured by the claimant's income, the amount of the credit not used as an offset against those taxes shall be certified to the department of administration for payment to the claimant by check, share draft or other draft. In this subdivision, "tribal enterprise" means a business that is at least 51% owned and controlled by the governing body of one or more Indian tribes, is actively managed by the governing body, or by the designee of the governing body, of one or more Indian tribes and is currently performing a useful business function.

SB86, s. 8 Section 8. 71.07 (2di) (c) of the statutes is repealed.

SB86, s. 9 Section 9. 71.07 (2dj) (h) of the statutes is amended to read:

SB86,4,12 71.07 (2dj) (h) The rules under sub. (2di) (b) and (c) as they apply to the credit under that subsection apply to the credit under this subsection.

SB86, s. 10 Section 10. 71.07 (2dL) (c) 2. of the statutes is amended to read:

SB86,4,20 71.07 (2dL) (c) 2. If the claimant is located on an Indian reservation, as defined in s. 560.86 (5), and is an American Indian, as defined in s. 560.86 (1), an Indian business, as defined in s. 560.86 (4), or a tribal enterprise, as defined in sub. (2di) (b) 2., and if the allowable amount of the credit under par. (a) exceeds the taxes otherwise due under this chapter on or measured by the claimant's income, the amount of the credit not used as an offset against those taxes shall be certified to the department of administration for payment to the claimant by check, share draft or other draft.

SB86, s. 11 Section 11. 71.07 (2dL) (d) of the statutes is repealed.

SB86, s. 12 Section 12. 71.07 (2dr) (f) of the statutes is repealed and recreated to read:

SB86,4,24 71.07 (2dr) (f) Carry-over. The rules under sub. (2di) (b) as they apply to the credit under that subsection apply to the credit under this subsection.

SB86, s. 13 Section 13. 71.07 (2ds) (h) of the statutes is amended to read:

SB86,5,2 71.07 (2ds) (h) The rules under sub. (2di) (b) and (c) as they apply to the credit under that subsection apply to the credit under this subsection.

SB86, s. 14 Section 14. 71.10 (4) (gd), (ge), (gg), (gm), (gr), (gs) and (gt) of the statutes are repealed.

SB86, s. 15 Section 15. 71.10 (4) (i) of the statutes is amended to read:

SB86,5,15 71.10 (4) (i) The total of claim of right credit under s. 71.07 (1), farmland preservation credit under subch. IX, homestead credit under subch. VIII, development zones day care credit under s. 71.07 (2dd), development zones environmental remediation credit under s. 71.07 (2de), development zones investment credit under s. 71.07 (2di), development zones jobs credit under s. 71.07 (2dj), development zones location credit under s. 71.07 (2dL), development zones research credit under s. 71.07 (2dr), development zones sales tax credit under s. 71.07 (2ds), farmland tax relief credit under s. 71.07 (3m), farmers' drought property tax credit under s. 71.07 (2fd), earned income tax credit under s. 71.07 (9e), estimated tax payments under s. 71.09, and taxes withheld under subch. X.

SB86, s. 16 Section 16. 71.28 (1dd) (c) of the statutes is amended to read:

SB86,5,18 71.28 (1dd) (c) Subsection (1di) (b), (c), (d) 1., (f) and (g), as it applies to the credit under sub. (1di), applies to the credit under this subsection.

SB86, s. 17 Section 17. 71.28 (1de) (a) (intro.) of the statutes is amended to read:

SB86,6,4 71.28 (1de) (a) (intro.) Except as provided in s. 73.03 (35), for any taxable year for which a person is certified under s. 560.765 (3) and begins business operations in a zone under s. 560.71 after July 29, 1995, entitled under s. 560.795 (3) (a) and begins business operations in a zone under s. 560.795 after July 29, 1995, or certified under s. 560.797 (4) (a), for each zone for which the person is certified or entitled the person may claim as a credit against taxes otherwise due under this subchapter an amount equal to 7.5% 33% of the amount that the person expends to remove or contain environmental pollution, as defined in s. 299.01 (4), in the zone or to restore soil or groundwater that is affected by environmental pollution, as defined in s. 299.01 (4), in the zone if the person fulfills all of the following requirements:

SB86, s. 18 Section 18. 71.28 (1de) (b) of the statutes is amended to read:

SB86,6,7 71.28 (1de) (b) Subsection (1di) (b), (c), (d), (f) and (g), as it applies to the credit under sub. (1di), applies to the credit under this subsection.

SB86, s. 19 Section 19. 71.28 (1di) (b) 2. of the statutes is amended to read:

SB86,6,16 71.28 (1di) (b) 2. If the claimant is located on an Indian reservation, as defined in s. 560.86 (5), and is an American Indian, as defined in s. 560.86 (1), an Indian business, as defined in s. 560.86 (4), or a tribal enterprise, as defined in s. 71.07 (2di) (b) 2., and if the allowable amount of the credit under this subsection exceeds the taxes otherwise due under this chapter on or measured by the claimant's income, the amount of the credit not used as an offset against those taxes shall be certified to the department of administration for payment to the claimant by check, share draft or other draft.

SB86, s. 20 Section 20. 71.28 (1di) (c) of the statutes is repealed.

SB86, s. 21 Section 21. 71.28 (1dj) (h) of the statutes is amended to read:

SB86,6,20 71.28 (1dj) (h) The rules under sub. (1di) (b) and (c) as they apply to the credit under that subsection apply to the credit under this subsection.

SB86, s. 22 Section 22. 71.28 (1dL) (c) 2. of the statutes is amended to read:

SB86,7,4 71.28 (1dL) (c) 2. If the claimant is located on an Indian reservation, as defined in s. 560.86 (5), and is an American Indian, as defined in s. 560.86 (1), an Indian business, as defined in s. 560.86 (4), or a tribal enterprise, as defined in s. 71.07 (2di) (b) 2., and if the allowable amount of the credit under par. (a) exceeds the taxes otherwise due under this chapter on or measured by the claimant's income, the amount of the credit not used as an offset against those taxes shall be certified to the department of administration for payment to the claimant by check, share draft or other draft.

SB86, s. 23 Section 23. 71.28 (1dL) (d) of the statutes is repealed.

SB86, s. 24 Section 24. 71.28 (1ds) (h) of the statutes is amended to read:

SB86,7,8 71.28 (1ds) (h) The rules under sub. (1di) (b) and (c) as they apply to the credit under that subsection apply to the credit under this subsection.

SB86, s. 25 Section 25. 71.30 (3) (eb), (ec), (eg), (em), (en) and (eo) of the statutes are repealed.

SB86, s. 26 Section 26. 71.30 (3) (f) of the statutes is amended to read:

SB86,7,19 71.30 (3) (f) The total of farmers' drought property tax credit under s. 71.28 (1fd), farmland preservation credit under subch. IX, development zones day care credit under s. 71.28 (1dd), development zones environmental remediation credit under s. 71.28 (1de), development zones investment credit under s. 71.28 (1di), development zones jobs credit under s. 71.28 (1dj), development zones location credit under s. 71.28 (1dL), development zones sales tax credit under s. 71.28 (1ds), farmland tax relief credit under s. 71.28 (2m) and estimated tax payments under s. 71.29.

SB86, s. 27 Section 27. 71.47 (1dd) (c) of the statutes is amended to read:

SB86,7,22 71.47 (1dd) (c) Subsection (1di) (b), (c), (d) 1., (f) and (g), as it applies to the credit under sub. (1di), applies to the credit under this subsection.

SB86, s. 28 Section 28. 71.47 (1de) (a) (intro.) of the statutes is amended to read:

SB86,8,7 71.47 (1de) (a) (intro.) Except as provided in s. 73.03 (35), for any taxable year for which a person is certified under s. 560.765 (3) and begins business operations in a zone under s. 560.71 after July 29, 1995, or certified under s. 560.797 (4) (a), for each zone for which the person is certified or entitled the person may claim as a credit against taxes otherwise due under this subchapter an amount equal to 7.5% 33% of the amount that the person expends to remove or contain environmental pollution, as defined in s. 299.01 (4), in the zone or to restore soil or groundwater that is affected by environmental pollution, as defined in s. 299.01 (4), in the zone if the person fulfills all of the following requirements:

SB86, s. 29 Section 29. 71.47 (1de) (b) of the statutes is amended to read:

SB86,8,10 71.47 (1de) (b) Subsection (1di) (b), (c), (d), (f) and (g), as it applies to the credit under s. 71.07 (2di), applies to the credit under this subsection.

SB86, s. 30 Section 30. 71.47 (1di) (b) 2. of the statutes is amended to read:

SB86,8,19 71.47 (1di) (b) 2. If the claimant is located on an Indian reservation, as defined in s. 560.86 (5), and is an American Indian, as defined in s. 560.86 (1), an Indian business, as defined in s. 560.86 (4), or a tribal enterprise, as defined in s. 71.07 (2di) (b) 2., and if the allowable amount of the credit under this subsection exceeds the taxes otherwise due under this chapter on or measured by the claimant's income, the amount of the credit not used as an offset against those taxes shall be certified to the department of administration for payment to the claimant by check, share draft or other draft.

SB86, s. 31 Section 31. 71.47 (1di) (c) of the statutes is repealed.

SB86, s. 32 Section 32. 71.47 (1dj) (h) of the statutes is amended to read:

SB86,8,23 71.47 (1dj) (h) The rules under sub. (1di) (b) and (c) as they apply to the credit under that subsection apply to the credit under this subsection.

SB86, s. 33 Section 33. 71.47 (1dL) (c) 2. of the statutes is amended to read:

SB86,9,8 71.47 (1dL) (c) 2. If the claimant is located on an Indian reservation, as defined in s. 560.86 (5), and is an American Indian, as defined in s. 560.86 (1), an Indian business, as defined in s. 560.86 (4), or a tribal enterprise, as defined in s. 71.07 (2di) (b) 2., and if the allowable amount of the credit under par. (a) exceeds the taxes otherwise due under this chapter on or measured by the claimant's income, the amount of the credit not used as an offset against those taxes shall be certified to the department of administration for payment to the claimant by check, share draft or other draft.

SB86, s. 34 Section 34. 71.47 (1dL) (d) of the statutes is repealed.

SB86, s. 35 Section 35. 71.47 (1ds) (h) of the statutes is amended to read:

SB86,9,12 71.47 (1ds) (h) The rules under sub. (1di) (b) and (c) as they apply to the credit under that subsection apply to the credit under this subsection.

SB86, s. 36 Section 36. 71.49 (1) (eb), (ec), (eg), (em), (en) and (eo) of the statutes are repealed.

SB86, s. 37 Section 37. 71.49 (1) (f) of the statutes is amended to read:

SB86,9,23 71.49 (1) (f) The total of farmers' drought property tax credit under s. 71.47 (1fd), farmland preservation credit under subch. IX, development zones day care credit under s. 71.47 (1dd), development zones environmental remediation credit under s. 71.47 (1de), development zones investment credit under s. 71.47 (1di), development zones jobs credit under s. 71.47 (1dj), development zones location credit under s. 71.47 (1dL), development zones sales tax credit under s. 71.47 (1ds), farmland tax relief credit under s. 71.47 (2m) and estimated tax payments under s. 71.48.

SB86, s. 38 Section 38. 560.745 (2) (a) of the statutes is amended to read:

SB86,10,5 560.745 (2) (a) When the department designates a development zone under s. 560.71, it shall establish a limit for tax benefits for the development zone determined by allocating to the development zone a portion of $28,155,000 $40,000,000. Of the total amount under this paragraph, the department shall allocate not less than $3,000,000 to development zones located in a 1st class city.

SB86, s. 39 Section 39. 560.75 (9) (b) of the statutes is amended to read:

SB86,10,11 560.75 (9) (b) With respect to a development zone located in a 1st class city, ensure that at all times in the development zone at least 65% of the tax benefits in the development zone, excluding the development zones environmental remediation credit under ss. 71.07 (2de), 71.28 (1de) and 71.47 (1de), is used for development zones jobs credits under ss. 71.07 (2dj), 71.28 (1dj) and 71.47 (1dj).

SB86, s. 40 Section 40. Nonstatutory provisions.

SB86,10,17 (1) Carry-over. All credits under sections 71.07 (2dd), (2de), (2di), (2dj), (2dL), (2dr) and (2ds), 71.28 (1dd), (1de), (1di), (1dj), (1dL) and (1ds) and 71.47 (1dd), (1de), (1di), (1dj), (1dL) and (1ds) of the statutes that have not been offset against taxes for taxable years that begin before January 1, 1998, may be offset for taxable years that begin on January 1, 1998, or thereafter.

SB86, s. 41 Section 41. Initial applicability.

SB86,10,19 (1) This act first applies to taxable years beginning on January 1, 1998.

SB86,10,20 (End)