Creation of economic development zones -- Tax credits -- Assignment of tax credit.
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(1) The office may create an economic development zone in the state if the following requirements are satisfied:
(a) the area is zoned agricultural, commercial, industrial, manufacturing, business park, research park, or other appropriate business related use in a community-approved master plan that contemplates future growth;
(b) the request to create a development zone has first been approved by an appropriate local government entity; and
(c) local incentives have been or will be committed to be provided within the area in accordance with the community's approved incentive policy and application process.
(2)
(a) In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the office shall make rules establishing the requirements for a business entity or local government entity to qualify for a tax credit for a new commercial project in a development zone under this part.
(b) The office shall ensure that the requirements described in Subsection (2)(a) include the following:
(i) the new commercial project is within the development zone;
(ii) the new commercial project includes direct investment within the geographic boundaries of the development zone;
(iii) the new commercial project brings new incremental jobs to Utah;
(iv) the new commercial project includes the creation of high paying jobs in the state, significant capital investment in the state, or significant purchases from vendors, contractors, or service providers in the state, or a combination of these three economic factors;
(v) the new commercial project generates new state revenues;
(vi) a business entity, a local government entity, or a community reinvestment agency to which a local government entity assigns a tax credit under this section meets the requirements of Section 63N-2-105; and
(vii) unless otherwise advisable in light of economic circumstances, the new commercial project relates to the industry clusters identified by the commission under Section 63N-1a-202.
(3)
(a) The office, after consultation with the GO Utah board, may enter into a written agreement with a business entity or local government entity authorizing a tax credit to the business entity or local government entity if the business entity or local government entity meets the requirements described in this section.
(b)
(i) With respect to a new commercial project, the office may authorize a tax credit to a business entity or a local government entity, but not both.
(ii) In determining whether to authorize a tax credit with respect to a new commercial project to a business entity or a local government entity, the office shall authorize the tax credit in a manner that the office determines will result in providing the most effective incentive for the new commercial project.
(c)
(i) Except as provided in Subsection (3)(c)(ii)(A), for a new commercial project that is located within the boundary of a county of the first or second class, the office may not authorize or commit to authorize a tax credit that exceeds:
(A) 50% of the new state revenues from the new commercial project in any given year; or
(B) 30% of the new state revenues from the new commercial project over the lesser of the life of a new commercial project or 20 years.
(ii) If the office authorizes or commits to authorize a tax credit for a new commercial project located within the boundary of:
(A) a municipality with a population of 10,000 or less located within a county of the second class and that is experiencing economic hardship as determined by the office, the office shall authorize a tax credit of up to 50% of new state revenues from the new commercial project over the lesser of the life of the new commercial project or 20 years;
(B) a county of the third class, the office shall authorize a tax credit of up to 50% of new state revenues from the new commercial project over the lesser of the life of the new commercial project or 20 years; and
(C) a county of the fourth, fifth, or sixth class, the office shall authorize a tax credit of 50% of new state revenues from the new commercial project over the lesser of the life of the new commercial project or 20 years.
(iii) Notwithstanding any other provisions of this section, the office may not authorize a tax credit under this section for a new commercial project:
(A) to a business entity that has claimed a High Cost Infrastructure Development Tax Credit described in Section 79-6-603 related to the same new commercial project; or
(B) in an amount more than the amount of the capital investment in the new commercial project.
(d)
(i) A local government entity may by resolution assign a tax credit authorized by the office to a community reinvestment agency.
(ii) The local government entity shall provide a copy of the resolution described in Subsection (3)(d)(i) to the office.
(iii) If a local government entity assigns a tax credit to a community reinvestment agency, the written agreement described in Subsection (3)(a) shall:
(A) be between the office, the local government entity, and the community reinvestment agency;
(B) establish the obligations of the local government entity and the community reinvestment agency; and
(C) establish the extent to which any of the local government entity's obligations are transferred to the community reinvestment agency.
(iv) If a local government entity assigns a tax credit to a community reinvestment agency:
(A) the community reinvestment agency shall retain records as described in Subsection (4)(d); and
(B) a tax credit certificate issued in accordance with Section 63N-2-105 shall list the community reinvestment agency as the named applicant.
(4) The office shall ensure that the written agreement described in Subsection (3):
(a) specifies the requirements that the business entity or local government entity shall meet to qualify for a tax credit under this part;
(b) specifies the maximum amount of tax credit that the business entity or local government entity may be authorized for a taxable year and over the life of the new commercial project;
(c) establishes the length of time the business entity or local government entity may claim a tax credit;
(d) requires the business entity or local government entity to retain records supporting a claim for a tax credit for at least four years after the business entity or local government entity claims a tax credit under this part; and
(e) requires the business entity or local government entity to submit to audits for verification of the tax credit claimed.
(5) The office may attribute an incremental job or a high paying job to a new commercial project regardless of whether the job is performed in person, within the development zone or remotely from elsewhere in the state.