Current through Register Vol. 43, No. 02, November 27, 2024
(1) Scope. This
regulation applies to the minimum criteria required for a Project to qualify
for the Capital Credit and continuing availability requirements.
(2) Definition. Terms defined in Reg.
810-2-7-.01 are incorporated
herein by reference for purposes of this regulation, unless the context clearly
indicates otherwise.
(3) Purpose.
The purpose of this regulation is to specify the minimum criteria required in
order to qualify a Project to receive the credit against the Alabama income tax
liability and continuing availability requirements.
(4) Procedure. A project sponsored or
undertaken by one or more Investing Companies which is in compliance with the
capital cost requirements and which is in compliance during the tax year with,
the new employees requirements, the base wage requirements, and the continuing
availability requirements shall entitle the Investing Company or Companies, or
the shareholders, partners, members, owners, or beneficiaries to the Capital
Credit.
(a) Minimum Capital Costs
1. Capital Costs incurred which are not less
than $2,000,000 and the Predominant Trade or Business Activity conducted at the
Project will constitute an Industrial, Warehousing or Research
activity.
2. A Small Business
Addition the Capital Costs incurred which are not less than $1,000,000 and the
Predominant Trade or Business Activity conducted at the Project will constitute
and Industrial, Warehousing or Research activity.
3. A Headquarters Facility the capital cost
of which is not less than $2,000,000.
(b) Minimum New Employees
1. Not less than 20 jobs for New Employees at
a Qualifying Project other than a Small Business Addition must be provided
beginning with the date which is not later than one year after the Qualifying
Project is Placed in Service and the average wages for all New Employees at the
Qualifying Project be not less than the Base Wage Requirement by the date which
is not later than one year after the Qualifying Project is Placed in Service
and during each year during which all or part of the Capital Credit is
available with respect to the Qualifying Project.
2. Not less than 15 jobs for New Employees at
a Qualifying Project which is a Small Business Addition must be provided
beginning with the date which is not later than one year after the Qualifying
Project is Placed in Service and the average wages for each all New Employees
at the Qualifying Project be not less than the Base Wage Requirement of this
regulation by the date which is not later than one year after the Qualifying
Project is Placed in Service and during each year during which all or part of
the Capital Credit is available with respect to the Qualifying
Project.
3. If an Investing Company
closes an existing facility in this sate and within two years following the
closing of the existing facility places a Qualifying Project in service, only
the number of jobs for New Employees in excess of the number of employees who
worked at the existing facility at the time of the closure shall be deemed jobs
for New Employees for the purposes of determining the number of jobs for New
Employees.
4. A company shall be
considered to have met the employment requirement for the portion of the year
following the date upon which such requirement is first met and for each year
thereafter (such portion of a year and each full year thereafter during the 20
year credit period is hereinafter referred to as a Compliance Year) if the
employment requirement is satisfied for at least 11/12 of each Compliance
Year.
(c) Base Wage
Requirements
1. Unless a Qualifying Project
is a direct project is a direct processor of agricultural food products, all
New Employees at a Qualified Project must either have an average hourly wage of
at least eight dollar ($8) per hour or an average Total Compensation of at
least ten dollars ($10) per hour. Direct processors of agricultural food
products are subject to the local labor market.
2. A company shall be considered to have met
the wage requirement for the portion of the year following the date upon which
such requirement is first met and for each year thereafter (such portion of a
year and each full year thereafter during the 20 year credit period is
hereinafter referred to as a Compliance Year) if the wage requirement is met
based on an average determined over each Compliance Year.
(d) Continuing Availability Requirements. Any
Investing Company that meets the employment and wage requirements by a date
which is no later than one year after the date on which the Qualifying Project
is Placed in Service, but fails to meet such requirements in any subsequent
Compliance Year, may still claim the Capital Credit for each Compliance Year in
which such Investing Company again meets the employment and wage requirements
of this section. In no event, however, shall an Investing Company be able to
claim a Capital Credit in a Compliance Year beginning after the third
Compliance Year (whether or not consecutive) in which the Investing Company
fails to meet the employment and wage requirements of this section or more than
nineteen (19) years after the year in which the Qualifying Project is first
Placed in Service.
Author: Verlon Frost, Melody Moncrief, Jeff
Taylor
