63N-2-104.2. Written agreement — Contents — Grounds for amendment or termination.
(1)
If the office determines that a business entity is eligible for a tax credit under Section 63N-2-104.1, the office may enter into a written agreement with the business entity that:
Terms Used In Utah Code 63N-2-104.2
Amendment: A proposal to alter the text of a pending bill or other measure by striking out some of it, by inserting new language, or both. Before an amendment becomes part of the measure, thelegislature must agree to it.
Local government entity: means a county, city, town, or metro township. See Utah Code 63N-2-103
New commercial project: means an economic development opportunity that:
(a)
involves a targeted industry;
(b)
is located within:
(i)
a county of the third, fourth, fifth, or sixth class; or
(ii)
a municipality that has a population of 10,000 or less and the municipality is located within a county of the second class; or
(c)
involves an economic development opportunity that the commission determines to be eligible for a tax credit under this part. See Utah Code 63N-2-103
New state revenue: means the state revenue collected from a business entity or a business entity's employees during a calendar year minus the baseline state revenue calculation. See Utah Code 63N-1a-102
Process: means a writ or summons issued in the course of a judicial proceeding. See Utah Code 68-3-12.5
Remote work opportunity: means a new commercial project that:
(a)
does not require a physical office in the state where employees associated with the new commercial project are required to work; and
(b)
requires employees associated with the new commercial project to:
(i)
work remotely from a location within the state; and
State: when applied to the different parts of the United States, includes a state, district, or territory of the United States. See Utah Code 68-3-12.5
State revenue: means state tax liability paid by a business entity or a business entity's employees under any combination of the following provisions:
Written agreement: means a written agreement entered into between the office and a business entity under Section 63N-2-104. See Utah Code 63N-2-103
(a)
establishes performance benchmarks for the business entity to claim a tax credit, including any minimum wage requirements;
(b)
specifies the maximum amount of tax credit that the business entity may be authorized for a taxable year and over the life of the new commercial project, subject to the limitations in Section 63N-2-104.3;
(c)
establishes the length of time the business entity may claim a tax credit;
(d)
requires the business entity to retain records supporting a claim for a tax credit for at least four years after the business entity claims the tax credit;
(e)
requires the business entity to submit to audits for verification of any tax credit claimed; and
(f)
requires the business entity, in order to claim a tax credit, to meet the requirements of Section 63N-2-105.
(2)
In establishing the terms of a written agreement, including the duration and amount of tax credit that the business entity may be authorized to receive, the office shall:
(a)
authorize the tax credit in a manner that provides the most effective incentive for the new commercial project;
(b)
consider the following factors:
(i)
whether the new commercial project provides vital or specialized support to supply chains;
(ii)
whether the new commercial project provides an innovative product, technology, or service;
(iii)
the number and wages of new incremental jobs associated with the new commercial project;
(iv)
the amount of financial support provided by local government entities for the new commercial project;
(v)
the amount of capital expenditures associated with the new commercial project;
(vi)
whether the new commercial project returns jobs transferred overseas;
(vii)
the rate of unemployment in the county in which the new commercial project is located;
(viii)
whether the new commercial project creates a remote work opportunity;
(ix)
whether the new commercial project is located in a development zone created by a local government entity as described in Subsection 63N-2-104(2);
(x)
whether the business entity commits to hiring Utah workers for the new commercial project;
(xi)
whether the business entity adopts a corporate citizenry plan or supports initiatives in the state that advance education, gender equality, diversity and inclusion, work-life balance, environmental or social good, or other similar causes;
(xii)
whether the business entity’s headquarters are located within the state;
(xiii)
the likelihood of other business entities relocating to another state as a result of the new commercial project;
(xiv)
the necessity of the tax credit for the business entity’s expansion in the state or relocation from another state; and
(xv)
the location and impact of the new commercial project on existing and planned transportation facilities, existing and planned housing, including affordable housing, and public infrastructure; and
(c)
consult with the GO Utah board.
(3)
(a)
In determining the amount of tax credit that a business entity may be authorized to receive under a written agreement, the office may:
(i)
authorize a higher or optimized amount of tax credit for a new commercial project located within a development zone created by a local government entity as described in Subsection 63N-2-104(2); and
The office may apply a process described in Subsection (3)(a)(ii) to a business entity only with respect to a new or amended written agreement that takes effect on or after January 1, 2022.
(4)
If the office identifies any of the following events after entering into a written agreement with a business entity, the office and the business entity shall amend, or the office may terminate, the written agreement:
(a)
a change in the business entity’s organization resulting from a merger with or acquisition of another entity located in the state;
(b)
a material increase in the business entity’s retail operations that results in new state revenue not subject to the incentive; or
(c)
an increase in the business entity’s operations that:
(i)
is outside the scope of the written agreement or outside the boundaries of a development zone; and
(ii)
results in new state revenue not subject to the incentive.
