SUMMARY--Authorizes partial abatement of personal property taxes for certain new or expanded businesses. (BDR 32-951)
FISCAL NOTE: Effect on Local Government: Yes.
Effect on the State or on Industrial Insurance: Yes.
EXPLANATION - Matter in italics is new; matter in brackets [ ] is material to be omitted.
AN ACT relating to taxation; authorizing a partial abatement of the property taxes on the personal property of certain new or expanded businesses; and providing other matters properly relating thereto.
THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
Section 1 Chapter 361 of NRS is hereby amended by adding thereto a new section to read as follows:
1. A person who intends to locate or expand a business in this state may apply to the commission on economic development for a partial abatement from the taxes imposed by this chapter on the personal property of the new or expanded business.
2. The commission on economic development may approve an application for a partial abatement if the commission determines that:
(a) The goals of the business are consistent with the goals of the commission concerning industrial development and diversification;
(b) The abatement is a significant factor in the decision of the applicant to locate or expand a business in this state;
(c) The average hourly wage which will be paid by the new or expanded business to its employees in this state is at least 125 percent of the average statewide industrial hourly wage as established by the employment security division of the department of employment, training and rehabilitation on July 1 of each fiscal year;
(d) The business will provide a health insurance plan for all employees;
(e) The cost, to the business, for the benefits the business provides to its employees in this state, including health insurance coverage, will be at least 20 percent of the average hourly wage;
(f) A capital investment for design, planning, construction or personal property will be made to locate or expand the business in Nevada which is at least:
(1) If the personal property directly related to the establishment or expansion of the business that is located in this state is primarily located in a county whose population is 100,000 or more, $50,000,000; and
(2) For all other businessess, $20,000,000;
(g) The business will create at least the following number of new, full-time and permanent jobs in Nevada by the fourth quarter that it is in operation:
(1) If the new or expanded business will be primarily located in a county whose population is 100,000 or more, 100 jobs; and
(2) For all other businesses, 35 jobs;
(h) The business is registered pursuant to the laws of this state or the applicant commits to obtain a valid business license and all other permits required by the county, city or town in which the business operates;
(i) The proposed abatement has been approved by the appropriate affected local government as determined pursuant to the regulations adopted pursuant to subsection 8; and
(j) The applicant has executed an agreement with the commission which states that the business will continue in operation in Nevada for 10 or more years after the date on which a certificate of eligibility for the abatement is issued pursuant to subsection 5 and will continue to meet the eligibility requirements contained in this subsection. The agreement must bind the sucessors in interest of the business for the required period.
3. An applicant shall, upon the request of the executive director of the commission on economic development, furnish him with copies of all records necessary to verify that the applicant meets the requirements of subsection 2.
4. The commission on economic development shall determine the percentage of the abatement on the basis of the regulations adopted pursuant to subsection 8. The abatement must not be less than 50 percent or more than 75 percent of the taxes payable each year.
5. If an application for a partial abatement is approved, the commission on economic development shall immediately forward a certificate of eligibility for the abatement that states the percentage of the abatement to:
(a) The department; and
(b) The county assessor of each county in which personal property directly related to the establishment or expansion of the business will be located.
6. Upon receipt by the department of taxation of the certificate of eligibility, the taxpayer is eligible for an abatement, in the percentage stated on the certificate, from the tax imposed by this chapter for 10 years:
(a) For the expansion of a business, on all personal property of the business that is located in Nevada and directly related to the expansion of the business in this state.
(b) For a new business, on all personal property of the business that is located in Nevada and directly related to the establishment of the business in this state.
7. If a business for which an abatement has been approved is not maintained in this state in accordance with the agreement required in subsection 2, for at least 10 years after the commission on economic development approved the abatement, the person who applied for the abatement shall repay to the county treasurer or treasurers who would have received the taxes but for the abatement the total amount of all taxes that were abated pursuant to this section unless the commission determines that the business substantially complied with the requirements of this section. The person who applied for the abatement shall pay interest on the amount due at the rate most recently established pursuant to NRS 99.040 for each month, or portion thereof, from the last day of the month following the period for which the payment would have been made if the abatement had not been granted until the date of the actual payment of the tax.
8. The commission on economic development shall adopt regulations necessary to carry out the provisions of this section. The regulations must include:
(a) A method for determining the appropriate affected local government to approve a proposed abatement and the procedure for obtaining such approval; and
(b) Criteria for determining the percentage of abatement, which must be based on such factors as the commission determines appropriate.
9. An applicant for an abatement who is aggrieved by a final decision of the commission on economic development may petition for judicial review in the manner provided in chapter 233B of NRS.
Sec. 2. This act becomes effective upon passage and approval for the purpose of adopting regulations and on July 1, 1997, for all other purposes.