SF 1091

as introduced - 91st Legislature (2019 - 2020) Posted on 02/11/2019 03:03pm

A bill for an act
relating to emergency management; providing exemption from tax nexus and
certain business licensing and registration requirements for the presence of
out-of-state employees and critical infrastructure companies, including affiliates
of in-state critical infrastructure companies, that temporarily provide resources
and personnel in the state during a state of emergency; proposing coding for new
law in Minnesota Statutes, chapter 12.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [12.71] CITATION.
new text end

new text begin Sections 12.71 to 12.75 may be cited as the "Facilitating Business Rapid Response to
Declared State Disaster Act."
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 2.

new text begin [12.72] DEFINITIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Terms. new text end

new text begin For purposes of sections 12.71 to 12.75, the following terms have
the meanings given them.
new text end

new text begin Subd. 2. new text end

new text begin Registered business in the state; registered business. new text end

new text begin "Registered business
in the state" or "registered business" means a business entity that is authorized to do business
in the state prior to the declared state disaster or emergency.
new text end

new text begin Subd. 3. new text end

new text begin Out-of-state business. new text end

new text begin (a) "Out-of-state business" means a business entity that:
new text end

new text begin (1) except for prior or current disaster or emergency-related work, has no presence in
the state and conducts no business in the state;
new text end

new text begin (2) has no requirement to register, file, or remit state or local taxes other than for disaster-
or emergency-related work during the tax year immediately preceding the tax year of declared
state disaster or emergency; and
new text end

new text begin (3) whose services are requested by a registered business, or by the federal government
or a state or local government, for purposes of performing disaster- or emergency-related
work in the state.
new text end

new text begin (b) Out-of-state business includes a business entity that is affiliated with the registered
business in the state solely through common ownership.
new text end

new text begin Subd. 4. new text end

new text begin Out-of-state employee. new text end

new text begin "Out-of-state employee" means an employee who does
not work in the state, except for disaster- or emergency-related work during the disaster
response period.
new text end

new text begin Subd. 5. new text end

new text begin Critical infrastructure. new text end

new text begin "Critical infrastructure" means property and equipment
owned or used by telecommunications, communications, Internet access, or video and
direct-to-home satellite television programming service facilities or networks; electric
generation, transmission, and distribution systems; gas distribution systems; water pipelines;
and related support facilities that service multiple customers or citizens including but not
limited to real and personal property such as buildings, offices, lines, poles, pipes, structures,
and equipment.
new text end

new text begin Subd. 6. new text end

new text begin Declared state disaster or emergency. new text end

new text begin "Declared state disaster or emergency"
means:
new text end

new text begin (1) a disaster or emergency event for which a governor's state of emergency proclamation
has been issued under section 12.31;
new text end

new text begin (2) a local emergency within the state declared by a local official as specified under
section 12.29;
new text end

new text begin (3) a disaster or emergency event for which a presidential declaration of a federal major
disaster or emergency has been issued; or
new text end

new text begin (4) other imminent disaster or emergency event within the state for which a good faith
response effort is required, and for which another authorized official of the state is given
notification from the registered business and such official designates such event as a disaster
or emergency thereby invoking the provisions of sections 12.71 to 12.75.
new text end

new text begin Subd. 7. new text end

new text begin Disaster response period. new text end

new text begin "Disaster response period" means a period that
begins ten days prior to the first day of a declared state disaster or emergency and that
extends 60 days after the conclusion of a declared state disaster or emergency, or any longer
period so authorized in section 12.31 by the governor.
new text end

new text begin Subd. 8. new text end

new text begin Disaster- or emergency-related work. new text end

new text begin "Disaster- or emergency-related work"
means repairing, renovating, installing, building, rendering services, or other business
activities that relate to critical infrastructure that has been damaged, impaired, or destroyed
by the declared state disaster or emergency.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 3.

new text begin [12.73] OBLIGATIONS DURING DISASTER RESPONSE PERIOD.
new text end

new text begin Subdivision 1. new text end

new text begin Business and employee status during disaster response period. new text end

new text begin (a)
An out-of-state business shall not be considered to have established a level of presence that
would require the business to register, file, or remit state or local taxes, or that would require
the business or its out-of-state employees to be subject to any state certification, licensing,
or registration requirements. This includes any and all state or local business certification,
licensing, or registration requirements or state and local taxes or fees including but not
limited to unemployment insurance, state or local occupational licensing fees, sales and use
tax, or ad valorem tax on equipment brought into the state temporarily for use during the
disaster response period and subsequently removed from the state, public utility commission
or secretary of state certification, and licensing and regulatory requirements.
new text end

new text begin (b) All activity of the out-of-state business that is conducted in this state pursuant to
sections 12.71 to 12.75 is disregarded with respect to:
new text end

new text begin (1) the allocation and apportionment of income under sections 290.17 and 290.191; and
new text end

new text begin (2) any filing requirements for unitary businesses, as defined in section 290.17,
subdivision 4, as required under sections 290.17 and 290.34, subdivision 2, or Minnesota
Rules, part 8019.0405, subpart 1.
new text end

new text begin (c) Presence in this state by an out-of-state employee is disregarded for purposes of
determining individual residency under section 290.01, subdivision 7, and employer
withholding tax requirements under section 290.92.
new text end

new text begin Subd. 2. new text end

new text begin Transaction taxes and fees. new text end

new text begin Out-of-state businesses and out-of-state employees
must pay transaction taxes and fees including but not limited to fuel taxes, state and local
sales taxes, hotel taxes, car rental taxes, or fees that apply to materials or services the
out-of-state business or out-of-state employee purchases for use or consumption in the state
during the disaster response period, unless the out-of-state business or out-of-state employee
is otherwise exempt from tax under sections 12.71 to 12.75.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 4.

new text begin [12.74] BUSINESS OR EMPLOYEE ACTIVITY AFTER DISASTER
RESPONSE PERIOD.
new text end

new text begin An out-of-state business or out-of-state employee that remains in the state after the
disaster response period is subject to the state's normal standards for establishing presence,
residency, or doing business in the state and will therefore become responsible for any
business or tax requirements that ensue.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end

Sec. 5.

new text begin [12.75] ADMINISTRATION.
new text end

new text begin Subdivision 1. new text end

new text begin Notification of out-of-state business during disaster response
period. new text end

new text begin (a) An out-of-state business that enters the state shall, upon request, provide to the
secretary of state a statement that it is in the state for purposes of responding to the disaster
or emergency. The statement must include the business name, state of domicile, principal
business address, federal tax identification number, date of entry, and contact information.
new text end

new text begin (b) A registered business in the state shall, upon request, provide the information required
in paragraph (a) for any affiliate that enters the state that is an out-of-state business. The
notification shall also include contact information for the registered business in the state.
new text end

new text begin Subd. 2. new text end

new text begin Notification of intent to remain in state. new text end

new text begin An out-of-state business or an
out-of-state employee that remains in the state after the disaster response period is subject
to state and local registration, licensing, and filing requirements that ensue as a result of
establishing a business presence or residency in the state applicable under state law.
new text end

new text begin Subd. 3. new text end

new text begin Rulemaking forms; records. new text end

new text begin The secretary of state shall: (1) promulgate
necessary rules; (2) develop and issue forms or online processes; and (3) maintain and make
available an annual record of any designations required under sections 12.71 to 12.75 to
carry out these administrative procedures.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2019.
new text end