HF 413

1st Engrossment - 80th Legislature (1997 - 1998) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act
  1.2             relating to taxation; income; allowing a job training 
  1.3             credit; proposing coding for new law in Minnesota 
  1.4             Statutes, chapter 290. 
  1.5   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.6      Section 1.  [290.0672] [JOB TRAINING PROGRAM CREDIT.] 
  1.7      Subdivision 1.  [CREDIT ALLOWED.] (a) A credit is allowed 
  1.8   against the tax imposed by section 290.06, subdivision 1, equal 
  1.9   to the sum of: 
  1.10     (1) placement fees paid to a job training program upon 
  1.11  hiring a qualified graduate of the program; and 
  1.12     (2) retention fees paid to a job training program for 
  1.13  retention of a qualified graduate of the program. 
  1.14     (b) The maximum placement fee qualifying for a credit under 
  1.15  this section is $8,000 per qualified graduate in the year 
  1.16  hired.  The maximum retention fee qualifying for a credit under 
  1.17  this section is $6,000 per qualified graduate retained as an 
  1.18  employee per year.  Only retention fees paid in the second and 
  1.19  third years after the qualified graduate is hired qualify for 
  1.20  the credit. 
  1.21     (c) A credit is allowed only up to the dollar amount of 
  1.22  certificates, issued under subdivision 4, and provided by the 
  1.23  job training program to the taxpayer. 
  1.24     Subd. 2.  [QUALIFIED JOB TRAINING PROGRAM.] (a) To qualify 
  1.25  for credits under this section, a job training program must 
  2.1   satisfy the following requirements: 
  2.2      (1) It must be operated by a nonprofit corporation that 
  2.3   qualifies under section 501(c)(3) of the Internal Revenue Code. 
  2.4      (2) The organization must spend at least $5,000 per 
  2.5   graduate of the program. 
  2.6      (3) The program must provide education and training in: 
  2.7      (i) basic skills, such as reading, writing, mathematics, 
  2.8   and communications; 
  2.9      (ii) thinking skills, such as reasoning, creative thinking, 
  2.10  decision making, and problem solving; and 
  2.11     (iii) personal qualities, such as responsibility, 
  2.12  self-esteem, self-management, honesty, and integrity. 
  2.13     (4) The program must provide income supplements, when 
  2.14  needed, to participants for housing, counseling, tuition, and 
  2.15  other basic needs. 
  2.16     (5) The education and training course must last for at 
  2.17  least six months. 
  2.18     (6) Individuals served by the program must: 
  2.19     (i) be 18 years old or older; 
  2.20     (ii) have had federal adjusted gross income of no more than 
  2.21  $10,000 per year in the last two years; 
  2.22     (iii) have assets of no more than $5,000, excluding the 
  2.23  value of a homestead; and 
  2.24     (iv) not have been claimed as a dependent on the federal 
  2.25  tax return of another person in the previous taxable year. 
  2.26     (7) The program must charge placement and retention fees 
  2.27  that exceed the amount of credit certificates provided to the 
  2.28  employer by at least ten percent of wages paid to graduates. 
  2.29     (b) The program must be certified by the commissioner of 
  2.30  children, families, and learning as meeting the requirements of 
  2.31  this subdivision. 
  2.32     Subd. 3.  [QUALIFIED GRADUATE.] A qualified graduate is a 
  2.33  graduate of a job training program qualifying under subdivision 
  2.34  1, who is placed in a job that is located in Minnesota and pays 
  2.35  at least $9 per hour or its equivalent.  To qualify for a credit 
  2.36  under this section for a retention fee, the job in which the 
  3.1   graduate is retained must pay at least $10 per hour.  A 
  3.2   business, other than the business that originally hired the 
  3.3   graduate, may pay a retention fee for the graduate and qualify 
  3.4   for the credit. 
  3.5      Subd. 4.  [DUTIES OF PROGRAM.] (a) Each program certified 
  3.6   by the commissioner under subdivision 2 must comply with the 
  3.7   requirements of this subdivision. 
  3.8      (b) Each program must maintain records for each graduate 
  3.9   for which the program provides a credit certificate to an 
  3.10  employer.  These records must include information sufficient to 
  3.11  verify the graduate's eligibility under this section, identify 
  3.12  the employer, describe the job including its compensation rate 
  3.13  and benefits, and determine the amount of placement and 
  3.14  retention fees received. 
  3.15     (c) Each program must report to the commissioner of revenue 
  3.16  by January 1, 2001, on its use of the credit.  The report must 
  3.17  include, at least, information on: 
  3.18     (1) the number of graduates placed; 
  3.19     (2) demographic information on the graduates; 
  3.20     (3) the types of positions in which the graduates are 
  3.21  placed, including compensation information; 
  3.22     (4) the tenure of graduates at the placed position or in 
  3.23  other jobs; 
  3.24     (5) the amount of employer fees paid to the program; 
  3.25     (6) the amount of money raised by the program from other 
  3.26  sources; and 
  3.27     (7) the types and sizes of employers with which graduates 
  3.28  have been placed and retained. 
  3.29     (d) The commissioner shall compile and summarize this 
  3.30  information and report to the legislature by February 15, 2001.  
  3.31     Subd. 5.  [ISSUANCE OF CREDIT CERTIFICATES.] (a) The total 
  3.32  amount of credits under this section is limited to $1,700,000 
  3.33  for taxable years beginning after December 31, 1996, and before 
  3.34  January 1, 2002.  The commissioner may issue under paragraph (b) 
  3.35  no more than the specified amount of certificates for taxable 
  3.36  years beginning during each calendar year: 
  4.1          1997            $200,000
  4.2          1998            $400,000
  4.3          1999            $600,000
  4.4          2000            $340,000
  4.5          2001            $160,000
  4.6      Unused certificates for a taxable year carry over and may 
  4.7   be used for a later taxable year, regardless of whether issued 
  4.8   by the commissioner. 
  4.9      (b) Upon application, the commissioner of children, 
  4.10  families, and learning shall issue certificates to job training 
  4.11  programs, certified under subdivision 2, up to the dollar amount 
  4.12  available for the taxable year.  The certificates must be in a 
  4.13  dollar amount that is no greater than the dollar amount applied 
  4.14  for, and reflects the commissioner's estimate of the job 
  4.15  training program's projected fees for placements and retentions 
  4.16  of qualifying graduates.  The commissioner shall issue the 
  4.17  certificates in the order in which applications are received 
  4.18  until the available authority has been issued. 
  4.19     (c) To the extent available, the job training program must 
  4.20  provide to employers of its qualified graduates certificates 
  4.21  issued by the commissioner of children, families, and learning 
  4.22  under this subdivision. 
  4.23     Subd. 6.  [NONREFUNDABLE; CARRYOVER.] (a) The credit for 
  4.24  the taxable year may not exceed the liability for tax under 
  4.25  section 290.06, subdivision 1, for the taxable year, reduced by 
  4.26  the sum of nonrefundable credits allowed under this chapter. 
  4.27     (b) If the credit for a taxable year exceeds the limitation 
  4.28  under paragraph (a), the excess is a carryover to each of the 
  4.29  five succeeding taxable years.  All of the carryover must be 
  4.30  carried to the earliest of the taxable years to which it may be 
  4.31  carried and then to each later year.  The carryover may not 
  4.32  exceed the taxpayer's tax under section 290.06, subdivision 1, 
  4.33  for the taxable year after deducting the credit for the taxable 
  4.34  year. 
  4.35     Subd. 7.  [EXPIRATION.] This section expires effective for 
  4.36  taxable years beginning after December 31, 2001.