Economic Development Incentives Legislative Update

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Economic Development Incentives Legislative Update

• Burnet R. Maybank III
• Nexsen Pruet, LLC
• SCEDA
• August 28, 2007

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Income Taxes Jobs Tax Credit

• Retail now qualifies for JTC in counties that are
  classified as underdeveloped and not traversed by
  interstate highway.

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Income Taxes

• Entities which are not corporations (i.e. LLCs)
  now qualify for RD income tax credit

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Income Taxes Multistate Taxpayers

• Numerous substantive and technical corrections
  were made to allocation and apportionment
  formulas for multistate manufacturers.

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Income Taxes JTC/MCBP

• Company receives higher JTC if the MCBP is
  developed and established on geographical
  boundary of adjacent counties, and revenue is
  split equally between the counties.

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Income Taxes

• A taxpayer who employs an apprentice pursuant to
  an apprentice agreement registered with the
  Office of Apprenticeships of the Employment and
  Training Administration of the United States
  Department of Labor is allowed a 1,000 income
  tax credit.

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Income Taxes Job Tax Credit

• A county may not drop more than one tier in a
  calendar year.

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Income Taxes Job Tax Credit

• The definition of corporate headquarters was
  clarified to include licensed general contractors.

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Sales Taxes

• Sales tax exemption created for purchases of
  machinery equipment by large theme parks, which
  consist of a 250 million capital investment, and
  250 full time/500 part time jobs.

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Sales Taxes

• The current sales tax exemption for construction
  materials used in the construction of large
  manufacturing and distribution facilities was
  clarified to make explicit that the exemption
  applies to both new, as well as expanded,
  facilities and

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Property Taxes Super Fee

• The requirements for a super fee under the
  Simplified Fee Act are
• 150 million capital investment and 125 New Jobs
  or
• 400 million capital investment (no longer have
  to create 200 jobs)

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Property Taxes

• Allows County Council to extend expiring
  fee-in-lieus by ten years this amendment is very
  important as the original fee-in-lieus are close
  to expiration.

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Property Taxes

• Numerous technical corrections to fee-in-lieu
  statutes.

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Admission Taxes

• Make it easier for Bass Pro Shops or other
  business to qualify as an extraordinary retail
  facility.

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Utility Tax Credit

• Clarifies that counties which utilize the Utility
  Tax Credit to construct industrial park and shell
  buildings may subsequently sell such facilities.
  (Fricks Law)

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Other

• Important technical corrections to the Venture
  Capital Act
• 20 Million to PRT for Product Development and
  Tourism
• 3 Million in Budget for Regional Development
  Alliances

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Other

• Funding for Regional Development Alliances
• 2.7 Million appropriated to
• Central SC Economic Development Alliance
• Charleston Regional Development Alliance
• Economic Development Partnership
• NESA
• South Carolina Alliance and
• Upstate Alliance

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Other

• Funding for Regional Development Alliances
• 300K to
• Chester
• Lancaster
• Union and
• York

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Other

• Funding for Regional Development Alliances
• The maximum funds dispersed to each organization
  shall be 450,000 and each dollar of state funds
  must be matched with one dollar of private funds.
  The organization receiving state funds must
  certify that the private funds are new dollars
  specifically designated for the purpose of
  matching state funds and have not been previously
  allocated or designated for economic development.

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Other

• Banks may now take tax credit for contributions
  to Industry Partnership Fund at SCRA.

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Other Non-Tax Items

• Workers Compensation
• Funding provided in budget for port access road
  as well as harbor dredging.
• Joint Municipal electric Power and Energy and
  Joint Municipal Water Systems Acts were updated.
• Conflict of interest rules relaxed for public
  members who serve on local boards and commissions.

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