 From Site Selection magazine, November 2004 
U.S. LEGISLATIVE UPDATE
|
|
Hawaii
The state's High Technology Development Corp. was authorized to issue special purpose revenue bonds worth up to $30 million to back facility and infrastructure development by Electricore in the development of unmanned vehicle and aerial systems; and up to $100 million to help Maryland-based Townsend Capital Partners fund a biotech incubator at the University of Hawaii. Separately, the state may issue up to $12 million in bonds for an agricultural processing plant, and it has extended its authority to issue such bonds until 2009. Legislators extended the state's high-tech tax credit program through 2010, while also restricting its allowable uses. That's because an audit was under way in mid-summer 2004 to evaluate 23 different companies and nearly $20 million in credits. According to the Honolulu Advertiser, the stricter law would save the state more than $65 million over the next two years. The Hawaii 3Ts school technology laboratories fund, administered by the Economic Development Alliance of Hawaii outside the state budget, was established for the continuation and expansion of the project EAST (environmental and spatial technology) initiative in Hawaii's public schools. Tax credit and bond authorization bills targeting ethanol facility development passed, with three plant projects waiting in the wings. Businesses and residents may both benefit from a renewable energy technologies income tax credit; for commercial property, which maxes out at 35 percent of the cost or $250,000 (whichever is lowest) for photovoltaic or solar systems, and 20 percent or $250,000 for wind energy systems.
Idaho
According to a measure passed in 2004, employers will receive a $1,000 state tax credit for every job they create that pays at least $15.50 an hour plus benefits. An agency merger created Idaho Commerce and Labor. The fiscal year budget devotes just under $20 million for economic development, a decrease of 5.5 percent. An extra 3-percent tax credit was extended for companies that expand broadband technology or promote R&D in new technologies. The state board of land commissioners is now authorized to lease endowment lands for industrial or commercial development for a period of up to 49 years. In addition, sales of such lands may now include minerals, so that the risk of mineral development does not reduce the value of the land.
Illinois
In a move that Connie Beard, executive director of the Illinois Chamber Tax Institute, calls "highly unusual," the state is recapturing all prior business expense deductions that have been claimed on an asset if income from the sale of the asset is treated as non-business income. Illinois Chamber and other officials were successful in limiting the recapture to only those expenses claimed in the two years prior to the asset disposition; the original proposal included an unlimited recapture period. When the Illinois General Assembly adjourned in late July 2004, the state Department of Commerce and Economic Opportunity had come out better than many of its counterparts across the nation, seeing a 12-percent rise in its funding, to $57.8 million. The employer training investment program will receive $18.5 million, 26 percent below the amount requested by Gov. Rod Blagojevich. But the Bureau of Workforce Development will receive $350 million in grants, matching his request. The governor's economic development planning request was slashed by 89 percent to $1.1 million, and his request of $76.7 million for the Bureau of Technology and Industrial Competitiveness was cut to $52.1 million. Like several other states, the appropriation to tourism was significant, coming in at $25 million above what the governor had requested, at $46.4 million. Only five of the governor's 15 tax proposals were included in the final budget. In addition, the budget restores the manufacturers purchase tax credit (now at 50 percent), the graphic arts machinery & equipment credit and the R&D credit. It rolls back some Industrial Commission fees, although wastewater discharge fees for large cities and businesses, raised in 2003, will see no decrease. The budget reduces a 1.5-percent workers' comp premium surcharge, payable to the commission, to 1.01 percent. Those who self-insure also saw their fee cut by more than half, and now must pay an annual fee equal to .0075 percent of annual wages paid. Additional workers' comp reform legislation is currently under discussion, with disagreement in the business community about its alleged benefits with regard to medical costs. A homestead exemption for property tax and a 7-percent cap on residential valuations now applies to property owners in counties with over 3 million inhabitants, thus shifting more of the property tax burden in Cook County to business. The Tooling & Manufacturing Association in Chicago says the total burden shifted is more than $450 million. Furthermore, the law allows other counties to adopt the Cook Co. classification system, which may shift their respective tax burdens accordingly. Using either total trips or mileage, purchasers of trucks and trailers may claim an exemption from the sales and use tax for "rolling stock moving in interstate commerce" if at least 50 percent of those trips or miles involve interstate commerce. The Illinois General Assembly will hold a fall veto session Nov. 8-10 and Nov. 16-18, 2004.
Indiana
The size requirement for a vacant facility to be eligible for the Industrial Recovery tax credit was reduced from 300,000 sq. ft. (27,870 sq. m.) to 250,000 sq. ft. (23,225 sq. m.). The credit applies to facilities placed into service at least 20 years ago, and which have been vacant for at least two years. However, the two-year minimum does not apply to facilities that have come into the ownership of cities or counties. A new package of incentives is available to businesses that locate in certain areas that contain a partially inactive or closed military base. The community revitalization enhancement district tax credit is available to qualified taxpayers regardless of whether incremental income or sales taxes have been deposited in the incremental tax financing fund established for that district. The 21st Century Research and Technology Fund is established to work with various entities to develop and receive R&D grants. The research expense tax credit was made permanent, and the business investment tax credit was extended by two years. A new law allows a political subdivision to borrow money to finance a public work project costing not more than $2,000,000 by issuing a note to a financial institution. Authorizes certain counties and municipalities to provide property tax abatements for logistical distribution equipment and information technology equipment installed after June 30, 2004. Authorizes local governments to impose an optional property tax abatement fee. An interim study committee on corporate taxation is looking at the utilization of passive investment corporations by companies doing business in Indiana. Provisions requiring consultation with university presidents and legislative leaders were added to the appointing procedures for the 23-member board of the Indiana Economic Development Corp., and an enterprise zone study commission was established.
Iowa
Democratic Iowa Gov. Tom Vilsack's $503-million, seven-year Iowa Values Fund was struck down by the state's Supreme Court after it had already awarded $72 million to some 36 construction projects. The ruling was in response to a Republican lawsuit regarding the Governor's line-item veto power. To keep Wells Dairy Inc. from moving its headquarters out of state, lawmakers quickly rewrote the state's New Jobs and Income incentive program to include those projects that involve new buildings that are leased as well as owned as part of an expansion project, provided the lease period is at least 10 years. Employers who hire a graduate of the state's Job Corps Center will now receive an income tax credit of up to $1,200 per graduate for the first 12 months of employment. The Iowa Corn Promotion Board now includes a financial assistance program to pay for value-added projects that use corn and expand corn markets. A bill protecting property owners from contaminated property liability under certain circumstances was vetoed by Gov. Vilsack, who said it did not go far enough in ensuring that those who do bear some responsibility are not immunized from accountability.
| ||||||||||||||||
|
| ||||||||||||||||
 | Site Selection Online | SiteNet | Feedback | Search SiteNet | ©2004 Conway Data, Inc. All rights reserved. SiteNet data is from many sources and is not warranted to be accurate or current.
|
