SF 1790

as introduced - 90th Legislature (2017 - 2018) Posted on 03/07/2017 09:20am

A bill for an act
relating to taxation; providing for career and technical education; establishing a
high school apprenticeship pilot program with a refundable income tax credit for
employers; appropriating money; requiring a report.

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

Section 1. new text begin HIGH SCHOOL APPRENTICESHIP CREDIT.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) For the purposes of this section, the terms defined in this
subdivision have the meanings given them.
new text end

new text begin (b) "Commissioner" means the commissioner of revenue.
new text end

new text begin (c) "Eligible student" means a high school student, age 16 or older.
new text end

new text begin (d) "Employer" means a taxpayer under Minnesota Statutes, section 290.01, with
employees located in Minnesota.
new text end

new text begin (e) "Greater Minnesota" means the area of Minnesota located outside the metropolitan
area as defined in Minnesota Statutes, section 473.121, subdivision 2.
new text end

new text begin Subd. 2. new text end

new text begin Program established. new text end

new text begin The commissioner shall administer a high school
apprenticeship pilot program in the 2018-2019 school year to provide career and technical
experience to high school students and tax credits for employers who provide apprenticeships
to high school students. The pilot program must operate at ten high schools. At least three
participating high schools must be located in each of the following areas:
new text end

new text begin (1) greater Minnesota;
new text end

new text begin (2) the city of Minneapolis or the city of St. Paul; and
new text end

new text begin (3) a Minnesota school district that is not located in the areas identified in clause (1) or
(2).
new text end

new text begin Subd. 3. new text end

new text begin Program components. new text end

new text begin (a) An apprentice must be an eligible student who is
enrolled in a career and technical education class related to the apprenticeship experience
as determined by the high school.
new text end

new text begin (b) To participate in the program, a high school must:
new text end

new text begin (1) enter into written agreements with one or more employers to provide apprenticeships
that are concurrent with a career and technical education class and continue for at least eight
weeks, during which the apprentice averages ten hours per week at the apprenticeship; and
new text end

new text begin (2) provide academic credit for the successful completion of the apprenticeship as part
of a career and technical education class.
new text end

new text begin (c) To participate in the program, an employer must enter into a written agreement with
a high school specifying that the apprentice:
new text end

new text begin (1) would not have been offered an apprenticeship without the tax credit described in
subdivision 5;
new text end

new text begin (2) does not and did not previously work for the employer in a position with the same
or similar responsibilities and duties as those that will be provided under the apprenticeship;
new text end

new text begin (3) does not replace an existing employee;
new text end

new text begin (4) has not previously participated in the program; and
new text end

new text begin (5) will be supervised and evaluated by the employer.
new text end

new text begin (d) The written agreement between the high school and the employer must certify a
credit amount to the employer, not to exceed $2,000 per apprentice, and must specify the
amount certified for apprenticeships in calendar years 2018 and 2019. The total dollar
amount of credits that a high school certifies to employers may not exceed the amount of
its allocation under subdivision 4. If the amount certified in the written agreement for
calendar year 2018 is not fully used, the high school and employer may revise the written
agreement to transfer the unused amount to calendar year 2019.
new text end

new text begin (e) The written agreement must specify the calendar months in which each apprenticeship
and corresponding career and technical education class is to begin and end.
new text end

new text begin (f) The written agreement between the high school and the employer must certify that
the employer is aware of and intends to comply with all applicable state and federal child
labor laws, including securing any necessary approvals under Minnesota Rules, parts
5200.0940 and 5200.0950.
new text end

new text begin (g) Employers participating in the program under this section do not have to comply
with Minnesota Statutes, chapter 177, with respect to eligible students participating in the
program. The written agreement between the high school and the employer must certify
that the school and employer intend to comply with the federal Fair Labor Standards Act
including federal Department of Labor guidance on unpaid internships.
new text end

new text begin (h) Participating high schools and employers must report annually to the commissioner.
The report must include at least the following:
new text end

new text begin (1) the number of apprenticeships provided;
new text end

new text begin (2) the number of hours and weeks for apprenticeships; and
new text end

new text begin (3) academic credits earned by apprentices.
new text end

new text begin Subd. 4. new text end

new text begin Credit allocation. new text end

new text begin (a) The total amount of credits allocated must not exceed
$1,000,000. The commissioner shall allocate equal amounts of credits to each participating
high school.
new text end

new text begin (b) A high school may apply to the commissioner to participate in the high school
apprenticeship pilot program. The application must be made in the form and manner specified
by the commissioner. The application must provide information sufficient for the
commissioner to determine:
new text end

new text begin (1) the location of the high school;
new text end

new text begin (2) the career and technical education classes the high school offers that would be part
of the high school apprenticeship pilot program;
new text end

new text begin (3) employer interest in participating in the high school apprenticeship pilot program;
and
new text end

new text begin (4) any other information that the commissioner deems appropriate.
new text end

new text begin (c) The commissioner must make applications available by October 1, 2017, and must
begin accepting applications by November 1, 2017. By December 31, 2017, the commissioner
must select high schools for participation on a first-come, first-served basis, subject to the
geographic requirements in subdivision 2, and may reject applications from high schools
that fail to identify career and technical education classes that would be part of the high
school apprenticeship pilot program or employer interest in participating.
new text end

new text begin Subd. 5. new text end

new text begin Tax credit allowed. new text end

new text begin (a) An employer is allowed a credit against the taxes
imposed by Minnesota Statutes, chapter 290, equal to the lesser of:
new text end

new text begin (1) $2,000 per apprentice; or
new text end

new text begin (2) the amount certified to the taxpayer by a high school. The taxpayer must claim the
credit in the taxable year in which the eligible student completes the apprenticeship, as
specified in the written agreement between the high school and the employer.
new text end

new text begin (b) Credits allowed to a partnership, a limited liability company taxed as a partnership,
an S corporation, or multiple owners of property are passed through to the partners, members,
shareholders, or owners, respectively, pro rata to each partner, member, shareholder, or
owner based on their share of the entity's income for the taxable year.
new text end

new text begin (c) If the amount of credit that the taxpayer is eligible to receive under this section
exceeds the taxpayer's tax liability under Minnesota Statutes, chapter 290, the commissioner
of revenue shall refund the excess to the taxpayer.
new text end

new text begin (d) An amount necessary to pay claims for refund provided in this section is appropriated
from the general fund to the commissioner of revenue.
new text end

new text begin (e) Notwithstanding the certification of credits to employers by high schools, the
commissioner of revenue may use any audit and examination powers under Minnesota
Statutes, chapter 270C or 289A, to the extent necessary to verify that the taxpayer is eligible
for the credit and to assess for the amount of any improperly claimed credit.
new text end

new text begin Subd. 6. new text end

new text begin Reports to the legislature. new text end

new text begin (a) By February 1, 2020, the commissioner shall
report to the committees of the legislature with jurisdiction over education and taxes on the
high school apprenticeship program. The report must include the following:
new text end

new text begin (1) the number and dollar amount of credits allowed;
new text end

new text begin (2) the number of apprenticeships provided under the program;
new text end

new text begin (3) the cost of administering the program; and
new text end

new text begin (4) an analysis of the effectiveness of the program in stimulating businesses to offer
apprenticeships.
new text end

new text begin (b) The report required under this subdivision must comply with Minnesota Statutes,
sections 3.195 and 3.197.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment and
credits are allowed for taxable years beginning after December 31, 2017, and before January
1, 2020.
new text end