The rules are not expected to impose significant costs or other impacts on small businesses because the rules address submittal of documentation only by applicants that choose to pursue tax credits for purchasing equipment which is utilized primarily to harvest or process woody biomass for use as a fuel or as a component of fuel.
Initial regulatory flexibility analysis
Types of small businesses that will be affected by the rules.
Businesses that choose to pursue the tax credits in sections
71.07 (3rm),
71.28 (3rm) and
71.47 (3rm) of the Statutes for purchasing equipment that is utilized primarily to harvest or process woody biomass for use as a fuel or as a component of fuel.
Reporting, bookkeeping and other procedures required for compliance with the rules.
An application form prescribed by the Department must be completed and submitted to the Department.
Types of professional skills necessary for compliance with the rules.
No new professional skills are necessary for compliance with the rules.
Rules have a significant economic impact on small businesses?
No.
Small business regulatory coordinator
Any inquiries for the small business regulatory coordinator for the Department of Commerce can be directed to Sam Rockweiler, as listed above.
Environmental Impact
Notice is hereby given that the Department has considered the environmental impact of the proposed rules. In accordance with chapter Comm 1, the proposed rules are a Type III action. A Type III action normally does not have the potential to cause significant environmental effects and normally does not involve unresolved conflicts in the use of available resources. The Department has reviewed these rules and finds no reason to believe that any unusual conditions exist. At this time, the Department has issued this notice to serve as a finding of no significant impact.
Fiscal Estimate
Assumptions used in arriving at fiscal estimate
Although the rules will newly result in review of documentation relating to certifying applicants as eligible to then claim allocated tax credits for investments in equipment for harvesting or processing woody biomass, the number of these reviews and allocations is expected to be too small to result in significant changes in the Department's costs for administering its business development programs. Therefore, the proposed rules are not expected to have any significant fiscal effect on the Department.
The proposed rules are not expected to impose any significant costs on the private sector, because the rules address only voluntary submittal of documentation relating to tax credits for equipment for harvesting or processing woody biomass.
State fiscal effect
None.
Local government fiscal effect
None.
Long-range fiscal implications
None known.
Agency Contact Person
Todd Jensen, Wisconsin Department of Commerce, Bureau of Business Finance, 201 West Washington Avenue, Madison, WI, 53703; telephone: (608) 266-3074; E-Mail:
Todd.Jensen@wisconsin.gov.
Notice of Hearing
Commerce
Financial Resources for Businesses and Communities, Chs.
Comm 100—
NOTICE IS HEREBY GIVEN that pursuant to section
560.2055 of the Statutes, the Department of Commerce will hold a public hearing on proposed rules in Chapter
Comm 101 relating to tax credits for jobs and training, and affecting small businesses.
Hearing Information
The hearing will be held on:
March 29, 2011
Tuesday
at 10:00 a.m.
|
Thompson Commerce Center
Third Floor, Room #B
201 W. Washington Avenue
Madison, WI 53703
|
This hearing will be held in an accessible facility. If you have special needs or circumstances that may make communication or accessibility difficult at the hearing, please call Sam Rockweiler at (608) 266-0797 or at Contact Through Relay at least 10 days prior to the hearing date. Accommodations such as interpreters, English translators, or materials in audio tape format will, to the fullest extent possible, be made available upon a request from a person with a disability.
Copies of Proposed Rule
The proposed rules and an analysis of the rules are available by entering “Comm 101" in the search engine at the following Web site:
https://health.wisconsin.gov/admrules/
public/Home. Paper copies may be obtained without cost from Sam Rockweiler at the Department of Commerce, Division of Environmental and Regulatory Services, P.O. Box 14427, Madison, WI 53707, or at
sam.rockweiler@wisconsin.gov, or at telephone (608) 266-0797, or at Contact Through Relay. Copies will also be available at the public Hearing.
Appearances at the Hearing and Submittal of Written Comments
Interested persons are invited to appear at the hearing and present comments on the proposed rules. Persons making oral presentations are requested to submit their comments in writing, via e-mail. Persons submitting comments will not receive individual responses. The hearing record on this rulemaking will remain open until
April 4, 2011, to permit submittal of written comments from persons who are unable to attend the hearing or who wish to supplement testimony offered at the hearing. E-mail comments should be sent to
sam.rockweiler@wisconsin.gov. If e-mail submittal is not possible, written comments may be submitted to Sam Rockweiler, Department of Commerce, Division of Environmental and Regulatory Services, P.O. Box 14427, Madison, WI 53708-0427.
Analysis Prepared by the Department of Commerce
Statute(s) interpreted
Statutory authority
Explanation of agency authority
Section
227.11 (2) (a) of the Statutes authorizes the Department to promulgate rules interpreting the provisions of any Statute administered by the Department. Section
560.2055 (5) (f) requires the Department to promulgate rules for implementing and operating section 560.2055, including rules that (1) define tier I and tier II counties and municipalities, (2) establish a schedule of the tax credits that can be claimed for costs incurred to undertake training, (3) establish conditions for revoking a certification of eligibility for tax credits and (4) establish conditions for repayment of the tax credits.
Related statute or rule
Several statutes and other Departmental rules address tax incentives for business development in Wisconsin, but those rules do not include the proposed definitions for tier I and tier II counties and municipalities, and do not specifically include the proposed rule text for earning refundable business tax credits by increasing net employment that either has an annual salary of $20,000 to $100,000 or is accompanied with employee training. Chapter
Comm 100 defines “full-time job" in a manner similar to the proposed definition.
Plain language analysis
The rules in this order include (1) definitions for tier I and tier II counties and municipalities; (2) the eligibility requirements for applicants; (3) the documentation that must be submitted by applicants to become certified as eligible for tax credits for jobs and training, and to receive acceptance of incurred expenses; (3) the Department's response to the submitted documentation and (4) filing a claim with the Department of Revenue for the corresponding tax credit.
Comparison with existing or proposed federal regulations
In researching federal tax incentives, the Department did not find any tax credits at the federal level that are exactly like the jobs tax credit in sections
71.07 (3q),
71.28 (3q),
71.47 (3q) and
560.2055 of the Statutes. The following federal tax credit may apply to some of the activities that may be addressed by the proposed rules, but this federal tax credit is structured differently than the credit in these sections of the Statutes.
Job creation that would be eligible for tax credits under the proposed rules may qualify for the federal consolidated Work Opportunity Tax Credit – which includes tax credits for an employer that hires an individual who is (1) a qualifying Hurricane Katrina employee, (2) a member of a qualifying family with long-term or recent receipt of Temporary Assistance to Needy Families payments, (3) a qualifying food stamp recipient, (4) a qualifying veteran, (5) a qualifying ex-felon, (6) a resident of a designated community, (7) a qualifying summer youth employee, (8) a qualifying recipient of vocational rehabilitative services, or (9) a qualifying recipient of Supplemental Security income.
Comparison with similar rules in adjacent states
Michigan:
Michigan has several tax credit and tax abatement programs targeting specific business activities: development, manufacture and commercialization of advanced batteries; brownfield clean-up; manufacturers seeking defense contracts; promotion of renewable energy operations; tool and die operations; agricultural processing facilities; and forest products processing facilities.
The Michigan Economic Growth Authority Job Creation Tax Credits and Job Retention Tax Credits may be awarded for up to 20 years and up to 100 percent of an amount equal to the salaries and wages and employer-paid health care benefits multiplied by the personal income tax rate.
Minnesota:
Minnesota's Job Opportunity Building Zone program offers a variety of tax exemptions and tax credits to businesses beginning operations in a designated zone, expanding in a zone, relocating to a zone from another state or relocating to a zone from another Minnesota location, if employment is increased by five jobs or 20 percent, whichever is greater, within the first full year of operation in the zone. Businesses may qualify for exemptions to corporate franchise taxes, and income taxes for operators or investors, including capital gains taxes; sales taxes on goods and services used in the zone; property taxes on commercial and industrial improvements; and wind energy production taxes. The program also includes a refundable job credit that is calculated in much the same manner as Wisconsin's tax credit for jobs and training.
Iowa:
Iowa's High Quality Job Creation program offers businesses various combinations of the following: a local property tax exemption of up to 100 percent of the value added to the property for up to 20 years; a refund of state sales, service or use taxes paid to contractors during construction; and an investment credit equal to a percentage of the qualifying investment, amortized over 5 years.
Illinois:
The Illinois Economic Development for a Growing Economy (EDGE) program offers tax credits as high as the amount of tax receipts collected from state income taxes paid by newly-hired or retained employees as pertaining to the project. Each project must add to the export potential of Illinois, involve capital investment of at least $5 million and create at least 25 new jobs, or meet requirements set forth by the Illinois Department of Commerce and Economic Opportunity. EDGE credits are available for up to 10 years for each project. Jobs and capital investments must be maintained for the period in which the credits are claimed.
In addition to a variety of tax exemptions, the Illinois Enterprise Zone program offers an investment credit of 0.5 percent and a jobs credit of $500 per eligible employee hired to work in a zone during a taxable year. Eligible employees are individuals who are certified as economically disadvantaged or as dislocated workers.
Summary of factual data and analytical methodologies
The data and methodology for developing these rules were derived from and consisted of (1) incorporating the criteria in section
560.2055 of the Statutes, which were enacted in
2009 Wisconsin Act 28; and (2) incorporating applicable best practices the Department has developed in administering similar programs for economic development, business development, and tax-credit verification.
Analysis and supporting documents used to determine effect on small business
The primary document that was used to determine the effect of the rules on small business was
2009 Wisconsin Act 28. This Act applies its private-sector requirements only to businesses for which a corresponding tax credit is desired.
Effect on Small Business
The rules are not expected to impose significant costs or other adverse impacts on small businesses because the rules address submittal of documentation, and other activities, only by applicants that choose to pursue tax credits for jobs and training.
Initial regulatory flexibility analysis
Types of small businesses that will be affected by the rules.
These rules may affect any business that elects to pursue tax credits under section
560.2055 of the Statutes for increasing net employment that either has an annual salary of $20,000 to $100,000 or is accompanied with employee training.
Reporting, bookkeeping and other procedures required for compliance with the rules.
A business certified under the rules must enter into a written contract with the Department that establishes the responsibilities which the business will fulfill with regard to the Department's terms and conditions in allocating a tax credit, such as submitting an annual project report to the Department.
Types of professional skills necessary for compliance with the rules.
No new professional skills are necessary for compliance with the rules.
Rules have a significant economic impact on small businesses?
No.
Small business regulatory coordinator
Any inquiries for the small business regulatory coordinator for the Department of Commerce can be directed to Sam Rockweiler, as listed above.
Environmental Impact
Notice is hereby given that the Department has considered the environmental impact of the proposed rules. In accordance with chapter Comm 1, the proposed rules are a Type III action. A Type III action normally does not have the potential to cause significant environmental effects and normally does not involve unresolved conflicts in the use of available resources. The Department has reviewed these rules and finds no reason to believe that any unusual conditions exist. At this time, the Department has issued this notice to serve as a finding of no significant impact.
Fiscal Estimate
Assumptions used in arriving at fiscal estimate
The rules are not expected to have any significant fiscal effect on the Department because they are not expected to result in any substantial increase in workload.
The rules are not expected to impose any significant costs on the private sector because the rules would only affect businesses that choose to pursue tax credits under section
560.2055 of the Statutes for increasing net employment which either has an annual salary of $20,000 to $100,000 or is accompanied with employee training.
State fiscal effect
None.
Local government fiscal effect
