 From Site Selection magazine, November 2002
U.S. LEGISLATIVE UPDATE
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Oklahoma
Oklahoma passed right-to-work legislation in 2001, which is the most significant recent development in the state's business climate. The Sooner State also passed a number of other measures that enhance the business climate, including the Small Employer Quality Jobs Incentive Act, which provides annual cash payments for as much as 5 percent of new taxable payroll for up to seven years. Qualifying payroll must be attributable to annual salaries that average at least 110 percent to 125 percent of the average wage of the county in which the jobs are located. Companies must be a basic industry as listed in the Quality Jobs Program except companies engaged in mining oil and gas. Oklahoma encourages alternative, zero-emission fuel production by providing tax credits to producers of electricity using such sources and to small wood turbine manufacturers. Producers may receive 75 one-hundredths of one percent per kilowatt-hour until 2005. Th credit gradually decreases until it ceases in 2012. Enhanced Work Opportunity Tax Credit and Welfare to Work credits are applicable within Oklahoma Empowerment Zones (EZ), and tax credits of up to $3,000 annually per new or existing employee that lives and works in the zone is available to businesses within the zone. Qualifying salary amounts are an offset when taking more than one of these credits. Also, capital gains on original stock, business interests and property purchased after 2000 and held for more than one year in an EZ business is excluded from income if placed in another EZ business within 60 days.
Oregon
Oregon's Economic and Community Development Department presented an economic stimulus plan to the Oregon State Legislative Emergency Board in April 2002. Part of the report reviewed measures put in place by the 2001 legislative session, including targeted marketing for industrial investment, industrial location and expansion assistance and incentives, international trade assistance, loan guarantees, business retention assistance and tax incentives for industrial investment among other provisions. The Department also made short- and long-term recommendations to the Board in its April presentation. Short-term considerations include a recommendation to provide an additional $3 million for the Strategic Reserve Fund for business retention and expansion incentives, increased tourism advertising, increased industrial investment promotion, incentives for film and video production and increased technology transfer from universities. It also recommends authorizing bond-backed funding for transportation improvements by implementing an increase of $15 per year in the vehicle registration fee. Long-term recommendations include continued support of Engineering and Technology Industry Council initiatives, support of recommendations of the Council for Knowledge and Economic Development, an increase in state incentives for targeted training to add or retain jobs and help business compete and educational reforms. Other recommendations include bolstering the department's loan and grant resources for local infrastructure and community facilities, increasing funding for transportation infrastructure, developing investment incentive mechanisms in the telecommunications arena, streamlining regulatory processes and developing a more balanced tax structure.
Pennsylvania
Gov. Mark Schweiker signed an executive order in June that creates a "PA Open for Business" project team office and governance structure aimed at making Pennsylvania a national leader in online interactions between business and government. The PA Open for Business Web site, which went online in 1999, provides a single service through which firms can register with government agencies. More than $4 million in funding was earmarked in the spring for 16 Critical Job Training Grants (CJTG), which provide training and education for high-demand jobs. Applicants for CJTG training include school districts, vocational-technical schools, local work force investment boards and public agencies that provide work-force services. Businesses and third-party service providers can now register online through the Electronic Tax Information and Data Exchange System (e-TIDES) to remit tax payments by electronic funds transfer. Businesses with liabilities of $20,000 or more must remit payments by EFT; now, all businesses may do so. A fifth Ben Franklin Technology Center was established in April, serving northwest Pennsylvania. Ben Franklin funding supports information technology development, e-training and outreach programs for local businesses. The Center, located at Penn State Erie, will involve participation from the region's universities. Work will focus on next-generation technologies, such as remote diagnostics. Gov. Schweiker and the General Assembly continued the planned reduction of the Capital Stock and Franchise Tax, reducing it by a quarter of a mill. The governor also called on the legislature to approve two key reforms the medical malpractice system and the doctrine of joint and several liability.
Puerto Rico
Gov. Sila M. Calderon enacted Law No. 109 last fall granting a tax credit equal to 50 percent of the cash used to acquire an exempt business that would otherwise close operations in Puerto Rico. The credit can be applied to the purchase of a majority of shares; the construction or improvement of physical facilities; and the purchase of a company's machinery and equipment. Gov. Calderon signed Law No. 112, which allows businesses in Puerto Rico to depreciate on an accelerated basis the costs incurred in the purchase or construction of buildings, structures, machinery and equipment. Gov. Calderon signed Law No. 145, which provides additional tax advantages to companies that bring innovative technologies to Puerto Rico. The law classifies these firms as "Pioneer Industries."
Rhode Island
The Ocean State's General Assembly passed the Industrial Property Remediation and Reuse Act, a brownfields redevelopment bill. The legislation specifies who is liable for costs or damages associated with hazardous substances; identifies properties of critical economic concern, which qualify for expedited remidiation; ensures that Rhode Island brownfield projects have access to environmental insurance at a reasonable cost; and requires the state economic development corporation to maintain an inventory of potential sites for development and act as a clearinghouse for investors and businesses that want to expand or locate in Rhode Island. A Lead Hazard Mitigation bill in the works for five years was signed into law. It reduces exposure to environmental lead and addresses issues of liability and insurance.
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