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Am. H. B. No. 135 As Reported by the House Economic Development and Regulatory Reform CommitteeAs Reported by the House Economic Development and Regulatory Reform Committee
130th General Assembly | Regular Session | 2013-2014 |
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Representatives Pelanda, Cera
Cosponsors:
Representatives Gonzales, Adams, J., Boose, Hackett, Fedor, Sprague, Burkley, Baker, Terhar
A BILL
To amend sections 5725.98, 5726.98, 5729.98, 5747.98,
and 5749.11 and to enact sections 122.177,
5725.35, 5726.58, 5729.18, 5747.78, 5749.18, and
5749.98 of the Revised Code to authorize a
nonrefundable credit against the income tax and
certain business taxes for the rehabilitation of a
vacant industrial site.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That sections 5725.98, 5726.98, 5729.98, 5747.98,
and 5749.11 be amended and sections 122.177, 5725.35, 5726.58,
5729.18, 5747.78, 5749.18, and 5749.98 of the Revised Code be
enacted to read as follows:
Sec. 122.177. (A) As used in this section:
(1) "Vacant facility" means a building, a complex of
buildings, or the structural remains of a former building or
complex of buildings that meet all of the following criteria:
(a) The building or buildings were used, or designed and
constructed for use, in production, manufacturing, fabrication,
assembly, processing, refining, finishing, or warehousing of
tangible personal property, including tangible personal property
that is or was used for sale to third parties or for use by the
owner in the owner's business.
(b) The building or buildings were placed into service at
least fifteen years before the date of an application submitted
under division (B) of this section with respect to the building or
buildings.
(c) At least seventy-five per cent of the square footage of
the building or building complex has not been used to carry on
production, manufacturing, assembly, processing, refining,
finishing, or warehousing of tangible personal property during the
five years immediately preceding the date an application is
submitted under division (B) of this section with respect to the
building or building complex.
For the purposes of this section, a building or vacant
facility is considered to have been "placed into service" when at
least fifty per cent of the combined square footage of the
building or vacant facility has been occupied.
(2) "Vacant industrial site" means a vacant facility and the
parcel or parcels of real property upon which the vacant facility
is located. "Vacant industrial site" shall not include any parcel
that is subject to an administrative, civil, or criminal
environmental enforcement action or against which delinquent
taxes, interest, assessments, and penalties remain unpaid.
(3) "Qualified investment" means expenditures for the
rehabilitation of a vacant industrial site that has been
designated as an industrial recovery site by the development
services agency under division (C) of this section. "Qualified
investment" shall not include legal expenses, including any
expenses incurred by reason of an administrative, civil, or
criminal environmental enforcement action brought with respect to
the vacant industrial site.
(4) "Rehabilitation" means the remodeling, repair,
alteration, demolition, or redevelopment of a vacant industrial
site for the purpose of putting the site to a better or more
efficient use.
(B) Upon application by a county or municipal corporation,
the director of development services may designate a vacant
industrial site located within the municipal corporation or county
as an industrial recovery site. A municipal corporation may
request such a designation for a site located within the municipal
corporation, and a county may request such a designation for a
site located within the unincorporated territory of the county.
The application shall be in the form prescribed by the
director. In addition to any other information required by the
director, the application shall include both of the following:
(1) A detailed plan for the development and use of the vacant
industrial site;
(2) A copy of a resolution adopted by the legislative
authority of the municipal corporation or the board of county
commissioners recommending designation of the site as an
industrial recovery site.
(C) The director of development services shall review each
application submitted under this section. The director shall
determine whether, on the date the application was filed, the site
described in an application qualifies as a vacant industrial site.
If the site so qualifies, the director shall determine whether
designation of the site as an industrial recovery site is in the
best interests of the state. In making that determination, the
director shall consider the following factors:
(1) The level of distress caused by job losses in the
community surrounding the vacant industrial site;
(2) The desirability of the intended use of the vacant
industrial site, as described in the plan submitted by the
municipal corporation or county, and the likelihood that
implementation of the plan will improve economic and employment
conditions in the surrounding community;
(3) Evidence that the residents, businesses, and other
private organizations in the surrounding community support
designation of the site as an industrial recovery site;
(4) Whether the vacant industrial site is located in an
enterprise zone created under sections 5709.61 to 5709.69, a joint
economic development zone created under section 715.691, or a
joint economic development district created under section 715.70
or 715.71 or sections 715.72 to 715.81 of the Revised Code;
(5) Whether the vacant industrial site is exempt from
property taxation pursuant to a resolution or ordinance adopted
under section 5709.40, 5709.41, 5709.73, or 5709.78 of the Revised
Code;
(6) Evidence of a commitment by private or public entities to
provide financial assistance in implementing the plan submitted by
the municipal corporation or county;
(7) Evidence of efforts by the municipal corporation or
county to implement the proposed plan without additional financial
assistance from the state;
(8) Any other factor the director considers relevant to the
determination.
Upon consideration of the factors described in this division,
the director shall approve or deny the application for
designation. The director shall certify the decision to the
municipal corporation or county that requested the designation.
When the director designates a site as an industrial recovery
site, the director shall list the industrial recovery site on the
development services agency's web site.
(D) The designation of a site as an industrial recovery site
is contingent upon the development and use of the site in
accordance with the plan submitted by the municipal corporation or
county under division (B) of this section. If the director
determines that the development of a site has resulted in a
violation of this condition, the director shall revoke the
industrial recovery site designation.
(E)(1) An owner or developer of an industrial recovery site
that makes a qualified investment in the site may apply to the
director of development services for a tax credit certificate. The
director may require owners or developers to include with the
application a uniform fee of not more than two thousand five
hundred dollars. In addition to any other information required by
the director, the application shall state the amount of the
qualified investment.
The director shall review the application and determine
whether all of the following criteria are met:
(a) The qualified investment was made for the rehabilitation
of property located on an industrial recovery site designated as
such by the director pursuant to division (C) of this section.
(b) The applicant is the owner or developer of the industrial
recovery site.
(c) The qualified investment was made in accordance with the
development plan submitted by the municipal corporation or county
in which the industrial recovery site is located.
(d) The applicant made all or part of the qualified
investment at least six months before submitting the application.
(e) The municipal corporation or county in which the
industrial recovery site is located has certified that the
rehabilitation of the industrial recovery site is substantially
complete.
(2) If the director determines that an application meets the
criteria in divisions (E)(1)(a) to (d) of this section, the
director shall issue a tax credit certificate. The amount of the
tax credit certificate shall equal the product obtained by
multiplying the applicant's qualified investment by one of the
following percentages:
(a) Fifteen per cent if the vacant facility that is located
on the industrial recovery site was placed into service at least
fifteen, but less than thirty, years before the date of the tax
credit certificate application;
(b) Twenty per cent if the vacant facility that is located on
the industrial recovery site was placed into service at least
thirty, but less than forty, years before the date of the tax
credit certificate application;
(c) Twenty-five per cent if the vacant facility that is
located on the industrial recovery site was placed into service
forty or more years before the date of the tax credit certificate
application.
(3) The director shall not issue any tax credit certificate
under this section after the last day of the sixtieth month after
the effective date of the enactment of this section.
(F) The owner of a tax credit certificate issued under this
section may assign the certificate to any other person. The
assignee shall provide written notice of the assignment to the tax
commissioner and the director of development services, in such
form as the tax commissioner prescribes, before the certificate
that was assigned is applied against a tax. The assignor may not
use the certificate to claim a credit to the extent that the
certificate was assigned to the assignee. The assignee may use the
certificate to claim a credit only to the extent that the assignor
has not claimed a credit on the basis of that certificate.
(G) On or before the first day of April each year, the
director shall submit to the governor, the president of the
senate, and the speaker of the house of representatives a report
on the tax credit program established under this section. The
report shall include information on the status of the
rehabilitation of each industrial recovery site designated under
this section. The director shall not be required to submit an
annual report after the sixth year after the year in which this
section becomes effective.
(H) The director shall adopt any rules necessary to
administer this section. Such rules shall include criteria for
when a municipal corporation or county may certify that the
rehabilitation of an industrial recovery site is substantially
complete under division (E)(1) of this section.
Sec. 5725.35. A nonrefundable credit is allowed against the
tax imposed under section 5725.18 of the Revised Code for an
insurance company that holds a tax credit certificate issued under
section 122.177 of the Revised Code. The credit shall equal the
dollar amount indicated on the certificate. The credit shall be
claimed in the calendar year specified on the certificate and in
the order required under section 5725.98 of the Revised Code. If
the amount of the credit exceeds the amount of tax otherwise due
under section 5725.18 of the Revised Code for the calendar year,
after allowing for any credits preceding the credit in the order
prescribed by section 5725.98 of the Revised Code, the insurance
company may carry forward the excess amount to subsequent calendar
years. The insurance company shall deduct the amount of the excess
credit allowed in any such year from the balance carried forward
to the next calendar year.
The insurance company shall make the tax credit certificate
available for inspection by the tax commissioner upon the request
of the tax commissioner.
Sec. 5725.98. (A) To provide a uniform procedure for
calculating the amount of tax imposed by section 5725.18 of the
Revised Code that is due under this chapter, a taxpayer shall
claim any credits and offsets against tax liability to which it is
entitled in the following order:
(1) The credit for an insurance company or insurance company
group under section 5729.031 of the Revised Code;
(2) The credit for eligible employee training costs under
section 5725.31 of the Revised Code;
(3) The credit for purchasers of qualified low-income
community investments under section 5725.33 of the Revised Code;
(4) The nonrefundable job retention credit under division
(B)(1) of section 122.171 of the Revised Code;
(5) The nonrefundable credit for rehabilitating a vacant
industrial site under section 5725.35 of the Revised Code;
(6) The offset of assessments by the Ohio life and health
insurance guaranty association permitted by section 3956.20 of the
Revised Code;
(6)(7) The refundable credit for rehabilitating a historic
building under section 5725.34 of the Revised Code.
(7)(8) The refundable credit for Ohio job retention under
division (B)(2) or (3) of section 122.171 of the Revised Code;
(8)(9) The refundable credit for Ohio job creation under
section 5725.32 of the Revised Code;
(9)(10) The refundable credit under section 5725.19 of the
Revised Code for losses on loans made under the Ohio venture
capital program under sections 150.01 to 150.10 of the Revised
Code.
(B) For any credit except the refundable credits enumerated
in this section, the amount of the credit for a taxable year shall
not exceed the tax due after allowing for any other credit that
precedes it in the order required under this section. Any excess
amount of a particular credit may be carried forward if authorized
under the section creating that credit. Nothing in this chapter
shall be construed to allow a taxpayer to claim, directly or
indirectly, a credit more than once for a taxable year.
Sec. 5726.58. A nonrefundable credit is allowed against the
tax imposed under section 5726.02 of the Revised Code for a
financial institution that holds a tax credit certificate issued
under section 122.177 of the Revised Code. The credit shall equal
the dollar amount indicated on the certificate. The credit shall
be claimed in the tax year specified on the certificate and in the
order required by section 5726.98 of the Revised Code. If the
amount of the credit exceeds the amount of tax otherwise due under
section 5726.02 of the Revised Code for the tax year, after
allowing for any credits preceding the credit in the order
prescribed by section 5726.98 of the Revised Code, the financial
institution may carry forward the excess amount to subsequent tax
years. The financial institution shall deduct the amount of the
excess credit allowed in any such year from the balance carried
forward to the next tax year.
The financial institution shall make the tax credit
certificate available for inspection by the tax commissioner upon
the request of the tax commissioner.
Sec. 5726.98. (A) To provide a uniform procedure for
calculating the amount of tax due under section 5726.02 of the
Revised Code, a taxpayer shall claim any credits to which the
taxpayer is entitled under this chapter in the following order:
(1) The bank organization assessment credit under section
5726.51 of the Revised Code;
(2) The nonrefundable job retention credit under division (B)
of section 5726.50 of the Revised Code;
(3) The nonrefundable credit for purchases of qualified
low-income community investments under section 5726.54 of the
Revised Code;
(4) The nonrefundable credit for qualified research expenses
under section 5726.56 of the Revised Code;
(5) The nonrefundable credit for qualifying dealer in
intangibles taxes under section 5726.57 of the Revised Code.;
(6) The nonrefundable credit for rehabilitating a vacant
industrial site under section 5726.58 of the Revised Code;
(7) The refundable credit for rehabilitating an historic
building under section 5726.52 of the Revised Code;
(7)(8) The refundable job retention or job creation credit
under division (A) of section 5726.50 of the Revised Code;
(8)(9) The refundable credit under section 5726.53 of the
Revised Code for losses on loans made under the Ohio venture
capital program under sections 150.01 to 150.10 of the Revised
Code;
(9)(10) The refundable motion picture production credit under
section 5726.55 of the Revised Code.
(B) For any credit except the refundable credits enumerated
in this section, the amount of the credit for a taxable year shall
not exceed the tax due after allowing for any other credit that
precedes it in the order required under this section. Any excess
amount of a particular credit may be carried forward if authorized
under the section creating that credit. Nothing in this chapter
shall be construed to allow a taxpayer to claim, directly or
indirectly, a credit more than once for a taxable year.
Sec. 5729.18. A nonrefundable credit is allowed against the
tax imposed under section 5729.03 of the Revised Code for an
insurance company that holds a tax credit certificate issued under
section 122.177 of the Revised Code. The credit shall equal the
dollar amount indicated on the certificate. The credit shall be
claimed in the calendar year specified on the certificate and in
the order required by section 5729.98 of the Revised Code. If the
amount of the credit exceeds the amount of tax otherwise due under
section 5729.03 of the Revised Code for the calendar year, after
allowing for any credits preceding the credit in the order
prescribed by section 5729.98 of the Revised Code, the insurance
company may carry forward the excess amount to subsequent calendar
years. The insurance company shall deduct the amount of the excess
credit allowed in any such year from the balance carried forward
to the next calendar year.
The insurance company shall make the tax credit certificate
available for inspection by the tax commissioner upon the request
of the tax commissioner.
Sec. 5729.98. (A) To provide a uniform procedure for
calculating the amount of tax due under this chapter, a taxpayer
shall claim any credits and offsets against tax liability to which
it is entitled in the following order:
(1) The credit for an insurance company or insurance company
group under section 5729.031 of the Revised Code;
(2) The credit for eligible employee training costs under
section 5729.07 of the Revised Code;
(3) The credit for purchases of qualified low-income
community investments under section 5729.16 of the Revised Code;
(4) The nonrefundable job retention credit under division
(B)(1) of section 122.171 of the Revised Code;
(5) The nonrefundable credit for rehabilitating a vacant
industrial site under section 5729.18 of the Revised Code;
(6) The offset of assessments by the Ohio life and health
insurance guaranty association against tax liability permitted by
section 3956.20 of the Revised Code;
(6)(7) The refundable credit for rehabilitating a historic
building under section 5729.17 of the Revised Code.
(7)(8) The refundable credit for Ohio job retention under
division (B)(2) or (3) of section 122.171 of the Revised Code;
(8)(9) The refundable credit for Ohio job creation under
section 5729.032 of the Revised Code;
(9)(10) The refundable credit under section 5729.08 of the
Revised Code for losses on loans made under the Ohio venture
capital program under sections 150.01 to 150.10 of the Revised
Code.
(B) For any credit except the refundable credits enumerated
in this section, the amount of the credit for a taxable year shall
not exceed the tax due after allowing for any other credit that
precedes it in the order required under this section. Any excess
amount of a particular credit may be carried forward if authorized
under the section creating that credit. Nothing in this chapter
shall be construed to allow a taxpayer to claim, directly or
indirectly, a credit more than once for a taxable year.
Sec. 5747.78. (A) A nonrefundable credit is allowed against
the tax imposed by section 5747.02 of the Revised Code for a
taxpayer that holds a tax credit certificate issued under section
122.177 of the Revised Code. The credit shall equal the dollar
amount indicated on the certificate. The credit shall be claimed
in the taxable year specified on the certificate and in the order
required under section 5747.98 of the Revised Code. If the amount
of the credit exceeds the amount of tax otherwise due under
section 5747.02 of the Revised Code for the taxable year, after
allowing for any credits preceding the credit in the order
prescribed by section 5747.98 of the Revised Code, the taxpayer
may carry forward the excess amount to subsequent taxable years.
The taxpayer shall deduct the amount of the excess credit allowed
in any such year from the balance carried forward to the next
taxable year.
(B) Nothing in this section limits or disallows pass-through
treatment of the credit if the person issued the tax credit
certificate under section 122.177 of the Revised Code is a
pass-through entity. If the certificate is issued to a
pass-through entity, the credit may be allocated among the
entity's equity owners in proportion to their ownership interests
or in such proportions or amounts as the equity owners mutually
agree.
(C) A credit may not be claimed under this section if a
credit is or was claimed under any other section of the Revised
Code on the basis of the same tax certificate issued under section
122.177 of the Revised Code.
(D) The taxpayer shall make the tax credit certificate
available for inspection by the tax commissioner upon the request
of the tax commissioner.
Sec. 5747.98. (A) To provide a uniform procedure for
calculating the amount of tax due under section 5747.02 of the
Revised Code, a taxpayer shall claim any credits to which the
taxpayer is entitled in the following order:
(1) The retirement income credit under division (B) of
section 5747.055 of the Revised Code;
(2) The senior citizen credit under division (C) of section
5747.05 of the Revised Code;
(3) The lump sum distribution credit under division (D) of
section 5747.05 of the Revised Code;
(4) The dependent care credit under section 5747.054 of the
Revised Code;
(5) The lump sum retirement income credit under division (C)
of section 5747.055 of the Revised Code;
(6) The lump sum retirement income credit under division (D)
of section 5747.055 of the Revised Code;
(7) The lump sum retirement income credit under division (E)
of section 5747.055 of the Revised Code;
(8) The low-income credit under section 5747.056 of the
Revised Code;
(9) The credit for displaced workers who pay for job training
under section 5747.27 of the Revised Code;
(10) The campaign contribution credit under section 5747.29
of the Revised Code;
(11) The twenty-dollar personal exemption credit under
section 5747.022 of the Revised Code;
(12) The joint filing credit under division (G) of section
5747.05 of the Revised Code;
(13) The nonresident credit under division (A) of section
5747.05 of the Revised Code;
(14) The credit for a resident's out-of-state income under
division (B) of section 5747.05 of the Revised Code;
(15) The credit for employers that enter into agreements with
child day-care centers under section 5747.34 of the Revised Code;
(16) The credit for employers that reimburse employee child
care expenses under section 5747.36 of the Revised Code;
(17) The credit for adoption of a minor child under section
5747.37 of the Revised Code;
(18) The credit for purchases of lights and reflectors under
section 5747.38 of the Revised Code;
(19) The nonrefundable job retention credit under division
(B) of section 5747.058 of the Revised Code;
(20) The credit for selling alternative fuel under section
5747.77 of the Revised Code;
(21) The second credit for purchases of new manufacturing
machinery and equipment and the credit for using Ohio coal under
section 5747.31 of the Revised Code;
(22) The job training credit under section 5747.39 of the
Revised Code;
(23) The enterprise zone credit under section 5709.66 of the
Revised Code;
(24) The credit for the eligible costs associated with a
voluntary action under section 5747.32 of the Revised Code;
(25) The credit for employers that establish on-site child
day-care centers under section 5747.35 of the Revised Code;
(26) The ethanol plant investment credit under section
5747.75 of the Revised Code;
(27) The credit for purchases of qualifying grape production
property under section 5747.28 of the Revised Code;
(28) The small business investment credit under section
5747.81 of the Revised Code;
(29) The credit for research and development and technology
transfer investors under section 5747.33 of the Revised Code;
(30) The enterprise zone credits under section 5709.65 of the
Revised Code;
(31) The research and development credit under section
5747.331 of the Revised Code;
(32) The credit for rehabilitating a vacant industrial site
under section 5747.78 of the Revised Code;
(33) The credit for rehabilitating a historic building under
section 5747.76 of the Revised Code;
(33)(34) The refundable credit for rehabilitating a historic
building under section 5747.76 of the Revised Code;
(34)(35) The refundable jobs creation credit or job retention
credit under division (A) of section 5747.058 of the Revised Code;
(35)(36) The refundable credit for taxes paid by a qualifying
entity granted under section 5747.059 of the Revised Code;
(36)(37) The refundable credits for taxes paid by a
qualifying pass-through entity granted under division (J) of
section 5747.08 of the Revised Code;
(37)(38) The refundable credit under section 5747.80 of the
Revised Code for losses on loans made to the Ohio venture capital
program under sections 150.01 to 150.10 of the Revised Code;
(38)(39) The refundable motion picture production credit
under section 5747.66 of the Revised Code.;
(39)(40) The refundable credit for financial institution
taxes paid by a pass-through entity granted under section 5747.65
of the Revised Code.
(B) For any credit, except the refundable credits enumerated
in this section and the credit granted under division (I) of
section 5747.08 of the Revised Code, the amount of the credit for
a taxable year shall not exceed the tax due after allowing for any
other credit that precedes it in the order required under this
section. Any excess amount of a particular credit may be carried
forward if authorized under the section creating that credit.
Nothing in this chapter shall be construed to allow a taxpayer to
claim, directly or indirectly, a credit more than once for a
taxable year.
Sec. 5749.11. (A) There is hereby allowed a nonrefundable
credit against the taxes imposed under division (A)(8) of section
5749.02 of the Revised Code for any severer to which a reclamation
tax credit certificate is issued under section 1513.171 of the
Revised Code. The credit shall be claimed in the amount shown on
the certificate. The credit shall be claimed by deducting the
amount of the credit from the amount of the first tax payment due
under section 5749.06 of the Revised Code after the certificate is
issued.
If the amount of the credit shown on a certificate exceeds
the amount of the tax otherwise due with that first payment, the
excess shall be claimed against the amount of tax otherwise due on
succeeding payment dates until the entire credit amount has been
deducted. The total amount of credit claimed against payments
shall not exceed the total amount of credit shown on the
certificate.
The severer shall claim the credit in the order required by
section 5749.98 of the Revised Code.
(B) A severer claiming a credit under this section shall
retain a reclamation tax credit certificate for not less than four
years following the date of the last tax payment against which the
credit allowed under that certificate was applied. Severers shall
make tax credit certificates available for inspection by the tax
commissioner upon the tax commissioner's request.
Sec. 5749.18. A nonrefundable credit is allowed against the
tax imposed under section 5749.02 of the Revised Code for a
severer that holds a tax credit certificate issued under section
122.177 of the Revised Code. The credit shall equal the dollar
amount indicated on the certificate. The credit shall be claimed
by deducting the amount of the credit from the amount of the first
tax payment due under section 5749.06 of the Revised Code after
the certificate is issued. If the amount of the credit shown on a
certificate exceeds the amount of the tax otherwise due with that
first payment, the excess shall be claimed against the amount of
tax otherwise due on succeeding payment dates until the entire
credit amount has been deducted. The total amount of credit
claimed against payments shall not exceed the total amount of
credit shown on the certificate.
The severer shall claim the credit in the order required by
section 5749.98 of the Revised Code.
The severer shall make the tax credit certificate available
for inspection by the tax commissioner upon the request of the tax
commissioner.
Sec. 5749.98. (A) To provide a uniform procedure for
calculating the amount of tax imposed by section 5749.02 of the
Revised Code that is due under this chapter, a taxpayer shall
claim any credits to which it is entitled in the following order:
(1) The nonrefundable credit for the reclamation of land or
water resources under section 5749.11 of the Revised Code;
(2) The nonrefundable credit for rehabilitating a vacant
industrial site under section 5749.18 of the Revised Code.
(B) For any credit, the amount of the credit for a tax period
shall not exceed the tax due after allowing for any other credit
that precedes it in the order required under this section. Any
excess amount of a particular credit may be carried forward if
authorized under the section creating that credit. Nothing in this
chapter shall be construed to allow a taxpayer to claim, directly
or indirectly, a credit more than once for a single tax period.
Section 2. That existing sections 5725.98, 5726.98, 5729.98,
5747.98, and 5749.11 of the Revised Code are hereby repealed.
Section 3. Section 5747.98 of the Revised Code is presented
in this act as a composite of the section as amended by both Am.
Sub. H.B. 386 and Am. Sub. H.B. 510 of the 129th General Assembly.
The General Assembly, applying the principle stated in division
(B) of section 1.52 of the Revised Code that amendments are to be
harmonized if reasonably capable of simultaneous operation, finds
that the composite is the resulting version of the section in
effect prior to the effective date of the section as presented in
this act.
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