LRB-1358/1
JK&CTS:nwn:rs
2011 - 2012 LEGISLATURE
April 12, 2011 - Introduced by Representatives Clark, Barca, Hintz, Fields, Roys,
Bewley
and Staskunas, cosponsored by Senators Lassa, Schultz, Holperin
and Taylor. Referred to Committee on Jobs, Economy and Small Business.
1An Act to amend 20.143 (1) (c), 20.143 (1) (er), 20.143 (1) (fi) and 20.143 (1) (ie);
2and to create 560.158 of the statutes; relating to: entrepreneurial tax credit
3access grants, providing an exemption from emergency rule procedures,
4granting rule-making authority, and making an appropriation.
Analysis by the Legislative Reference Bureau
Under current law, generally, the Department of Commerce (Commerce) may
certify a person to receive income and franchise tax credits based on the person's
expenditures to acquire, improve, or construct real property or acquire tangible
personal property in this state related to the person's business. Under this bill,
Commerce may award a grant to a person who wishes to secure financing to make
expenditures that would qualify for such tax credits. A person is eligible to receive
a grant if the expenditures are made for a business located in this state that has fewer
than 25 employees in this state or less than $5,000,000 in gross receipts. No person
may receive a grant unless the person has submitted business and financing plans
to a commercial lending institution and submitted copies of the plans to Commerce.
Before awarding a grant, Commerce must verify that the lender has approved the
person's plans and will underwrite a loan for expenditures, contingent on the person
receiving a grant. Under the bill, a person who receives a grant to secure financing
for making an expenditure that would qualify for a tax credit may not claim a credit
for that expenditure.

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:
1Section 1. 20.143 (1) (c) of the statutes is amended to read:
2 20.143 (1) (c) Wisconsin development fund; grants, loans, reimbursements, and
3assistance.
Biennially, the amounts in the schedule for grants under ss. 560.145,
4560.158,
and 560.047; for loans under s. 560.128; for grants and loans under ss.
5560.275 (2) and 560.276 and under subch. V of ch. 560; for reimbursements under s.
6560.167; for the costs specified in s. 560.607; for loans under s. 560.203 and the loan
7under 1999 Wisconsin Act 9, section 9110 (4); and for the grants under 1995
8Wisconsin Act 27
, section 9116 (7gg), 1995 Wisconsin Act 119, section 2 (1), 1997
9Wisconsin Act 27
, section 9110 (6g), 2003 Wisconsin Act 33, section 9109 (1d) and
10(2q), 2007 Wisconsin Act 20, section 9108 (4u), (6c), (7c), (7f), (8c), (8i), (9i), and (10q),
112009 Wisconsin Act 2, section 9110 (2) and (3), and 2009 Wisconsin Act 28, section
129110 (17q).
13Section 2. 20.143 (1) (er) of the statutes is amended to read:
14 20.143 (1) (er) Rural economic development program. Biennially, the amounts
15in the schedule for grants and loans under s. ss. 560.158 and 560.17.
16Section 3. 20.143 (1) (fi) of the statutes is amended to read:
17 20.143 (1) (fi) Forward innovation fund; grants and loans. Biennially, the
18amounts in the schedule for grants and loans under s. ss. 560.158 and 560.276 and
19under subch. II of ch. 560.
20Section 4. 20.143 (1) (ie) of the statutes is amended to read:

120.143 (1) (ie) Wisconsin development fund, repayments. All moneys received
2in repayment of grants or loans under s. 560.085 (4) (b), 1985 stats., s. 560.10, 2005
3stats., s. 560.147, 2005 stats., s. 560.16, 1995 stats., s. 560.165, 1993 stats., s. 560.275
4(2), s. 560.62, 2005 stats., s. 560.63, 2005 stats., s. 560.66, 2005 stats., ss. 560.145,
5560.157, 560.158, and 560.45, subch. V of ch. 560, 1989 Wisconsin Act 336, section
63015 (1m), 1989 Wisconsin Act 336, section 3015 (2m), 1989 Wisconsin Act 336,
7section 3015 (3gx), 1997 Wisconsin Act 27, section 9110 (7f), 1997 Wisconsin Act 310,
8section 2 (2d), 1999 Wisconsin Act 9, section 9110 (4), and 2007 Wisconsin Act 20,
9section 9108 (5x), not appropriated under par. (gv) to be used for grants and loans
10under ss. 560.275 (2), 560.276, and 560.45 and subch. V of ch. 560, for loans under
11s. 560.128, for the loan under 1999 Wisconsin Act 9, section 9110 (4), for the grant
12under 2001 Wisconsin Act 16, section 9110 (7g), for the grants under 2003 Wisconsin
13Act 33
, section 9109 (1d) and (2q), for grants under 2009 Wisconsin Act 265, section
1445 (1), for the study under 2009 Wisconsin Act 28, section 9110 (15u), and for
15reimbursements under s. 560.167.
16Section 5. 560.158 of the statutes is created to read:
17560.158 Entrepreneurial tax credit access grants. (1) The department
18may award a grant to a person who intends to use the grant to secure financing for
19making expenditures that would qualify for a credit under s. 71.07 (2dy), (3g) (a) 2.,
20(3n), (3p), (3r), (3rm), or (3rn), 71.28 (1dy), (3g) (a) 2., (3n), (3p), (3r), (3rm), or (3rn),
21or 71.47 (1dy), (3g) (a) 2., (3n), (3p), (3r), (3rm), or (3rn), if the expenditures are made
22for a business located in this state that has fewer than 25 employees in this state or
23less than $5,000,000 in gross receipts for the taxable year in which the person applies
24for a grant under this section.

1(2) Any person who wishes to receive a grant under this section shall complete
2and submit an application to the department and enter into an agreement with the
3department to use the grant to secure financing for making expenditures described
4under sub. (1) and to repay any or all of the grant proceeds to the department if the
5person fails to comply with the agreement. An agreement under this subsection may
6provide that repayment shall be obtained through full or partial repayment of the
7principal amount of the grant plus interest, through receipt of a share of future
8profits from or an interest in a product or process, or through any other appropriate
9means.
10(3) (a) No person may receive a grant under this section unless the person has
11submitted business and financing plans to a commercial lending institution and
12submitted copies of the plans to the department. Before awarding a grant, the
13department shall verify that the lender has approved the person's plans and will
14underwrite a loan for expenditures described under sub. (1), contingent on the
15person receiving a grant under this section.
16 (b) The amount of any grant awarded under this section is the amount equal
17to 95 percent of the tax credit that the recipient could otherwise receive for making
18expenditures described under sub. (1), except that the amount of the grant may not
19exceed an amount equal to 20 percent of the cost of the project that is being
20financed.(c) The department shall require, as a condition of the grant, that the
21recipient contribute to a project an amount that is not less than the amount the
22recipient receives as a grant under this section.
23(4) A person who receives a grant under this section to secure financing for
24making an expenditure described under sub. (1) may not claim a credit under s. 71.07
25(2dy), (3g) (a) 2., (3n), (3p), (3r), (3rm), or (3rn), 71.28 (1dy), (3g) (a) 2., (3n), (3p), (3r),

1(3rm), or (3rn), or 71.47 (1dy), (3g) (a) 2., (3n), (3p), (3r), (3rm), or (3rn) for that
2expenditure.
3(5) (a) The department shall pay grants from the appropriations under s.
420.143 (1) (c), (er), (ie), and (fi). The total amount that the department may award
5under this section in a financial year is $8,000,000.
6 (b) The department shall promulgate rules to administer this section.
7 (c) The department may not award grants under this section after January 1,
82015.
9Section 6. Nonstatutory provisions.
10 (1) Entrepreneurial tax credit access grants. Using the procedure under
11section 227.24 of the statutes, the department of commerce shall promulgate the
12rules required under section 560.158 (5) (b) of the statutes, as created by this act, for
13the period before the effective date of the permanent rule promulgated under section
14560.158 (5) (b) of the statutes, as created by this act, but not to exceed the period
15authorized under section 227.24 (1) (c) of the statutes, subject to the extension under
16section 227.24 (2) of the statutes. Notwithstanding section 227.24 (1) (a), (2) (b), and
17(3) of the statutes, the department is not required to provide evidence that
18promulgating a rule under this subsection as an emergency rule is necessary for the
19preservation of the public peace, health, safety, or welfare and is not required to
20provide a finding of emergency for a rule promulgated under this subsection.
21 (End)
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