1.1                          A bill for an act
  1.2             relating to taxation; corporate franchise tax; 
  1.3             allowing a tax credit for participation in a targeted 
  1.4             job training program; proposing coding for new law in 
  1.5             Minnesota Statutes, chapter 290. 
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  [290.0672] [JOB TRAINING CREDIT.] 
  1.8      Subdivision 1.  [CREDIT ALLOWED.] (a) A credit is allowed 
  1.9   against the tax imposed by section 290.06, subdivision 1, equal 
  1.10  to the sum of: 
  1.11     (1) placement fees paid to a job training program upon 
  1.12  hiring a qualified graduate of the program; and 
  1.13     (2) retention fees paid to a job training program for 
  1.14  retention of a qualified graduate of the program. 
  1.15     (b) The maximum placement fee qualifying for a credit under 
  1.16  this section is $12,000 per qualified graduate in the year 
  1.17  hired.  The maximum retention fee qualifying for a credit under 
  1.18  this section is $6,000 per qualified graduate retained as an 
  1.19  employee per year.  Only retention fees paid in the second year 
  1.20  and third year after the qualified graduate is hired qualify for 
  1.21  the credit. 
  1.22     (c) A credit is allowed only up to the dollar amount of 
  1.23  certificates, issued under subdivision 4, and provided by the 
  1.24  job training program to the taxpayer. 
  1.25     Subd. 2.  [QUALIFIED JOB TRAINING PROGRAM.] (a) To qualify 
  2.1   for credits under this section, a job training program must 
  2.2   satisfy the following requirements: 
  2.3      (1) It must be operated by a nonprofit corporation, 
  2.4   qualifying under section 501(c)(3) of the Internal Revenue Code. 
  2.5      (2) The organization must spend an average of $5,000 per 
  2.6   participant in the program. 
  2.7      (3) The program must provide education and training in: 
  2.8      (i) basic skills, such as reading, writing, mathematics, 
  2.9   and communications; 
  2.10     (ii) thinking skills, such as reasoning, creative thinking, 
  2.11  decision making, and problem solving; and 
  2.12     (iii) personal qualities, such as responsibility, 
  2.13  self-esteem, self-management, honesty, and integrity. 
  2.14     (4) The program must provide income supplements, when 
  2.15  needed, to participants for housing, counseling, tuition, and 
  2.16  other basic needs. 
  2.17     (5) The education and training course must last for at 
  2.18  least six months. 
  2.19     (6) Individuals served by the program must: 
  2.20     (i) be over 18 years old; 
  2.21     (ii) have had income of no more than $10,000 per year in 
  2.22  the last two years; 
  2.23     (iii) have assets of no more than $5,000; 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     (b) In addition, the program must be certified by the 
  2.27  commissioner of revenue as meeting the requirements of this 
  2.28  subdivision. 
  2.29     Subd. 3.  [QUALIFIED GRADUATE.] A qualified graduate is a 
  2.30  graduate of a job training program qualifying under subdivision 
  2.31  1, who is placed in a job paying at least $9 per hour or its 
  2.32  equivalent. 
  2.33     Subd. 4.  [ISSUANCE OF CREDIT CERTIFICATES.] (a) The total 
  2.34  amount of credits under this section is limited to $1,500,000 
  2.35  for taxable years beginning after December 31, 1995, and before 
  2.36  January 1, 2002.  No more than $250,000 in credits may be 
  3.1   allowed for the taxable years beginning during a calendar year. 
  3.2      (b) Upon application, the commissioner shall issue 
  3.3   certificates to job training programs, certified under 
  3.4   subdivision 2, up to the dollar amount available for the taxable 
  3.5   year.  The certificates must be in a dollar amount (1) up to the 
  3.6   dollar amount applied for, and (2) that reflects the 
  3.7   commissioner's estimate of the job training program's projected 
  3.8   fees for placements and retentions of qualifying graduates.  The 
  3.9   commissioner shall issue the certificates in the order in which 
  3.10  applications are received until the available authority has been 
  3.11  issued. 
  3.12     (c) To the extent available, the job training program must 
  3.13  provide to employers of its qualified graduates certificates 
  3.14  issued by the commissioner under this subdivision. 
  3.15     Subd. 5.  [NONREFUNDABLE; CARRYOVER.] (a) The credit for 
  3.16  the taxable year may not exceed the liability for tax under 
  3.17  section 290.06, subdivision 1, for the taxable year, reduced by 
  3.18  the sum of nonrefundable credits allowed under this chapter. 
  3.19     (b) If the credit for a taxable year exceeds the limitation 
  3.20  under paragraph (a), the rest is a carryover to each of the five 
  3.21  succeeding taxable years.  All of the carryover must be carried 
  3.22  to the earliest of the taxable years to which it may be carried 
  3.23  and then to each later year.  The carryover may not exceed the 
  3.24  taxpayer's tax under section 290.06, subdivision 1, for the 
  3.25  taxable year after deducting the credit for the taxable year. 
  3.26     Subd. 6.  [EXPIRATION.] This section expires effective for 
  3.27  taxable years beginning after December 31, 2001. 
  3.28     Sec. 2.  [EFFECTIVE DATE.] 
  3.29     Section 1 is effective for taxable years beginning after 
  3.30  December 31, 1995.