1997 Minnesota Statutes

     290.0673 Job training program credit. 

    Subdivision 1.    Credit allowed.  (a) A credit is 
 allowed against the tax imposed by section 290.06, subdivision 
 1, equal to the sum of: 

    (1) placement fees paid to a job training program upon 
 hiring a qualified graduate of the program; and 

    (2) retention fees paid to a job training program for 
 retention of a qualified graduate of the program. 

    (b) The maximum placement fee qualifying for a credit under 
 this section is $8,000 per qualified graduate in the year 
 hired.  The maximum retention fee qualifying for a credit under 
 this section is $6,000 per qualified graduate retained as an 
 employee per year.  Only retention fees paid in the second and 
 third years after the qualified graduate is hired qualify for 
 the credit. 

    (c) A credit is allowed only up to the dollar amount of 
 certificates, issued under subdivision 4, and provided by the 
 job training program to the taxpayer. 

    Subd. 2.    Qualified job training program.  (a) To 
 qualify for credits under this section, a job training program 
 must satisfy the following requirements: 

    (1) It must be operated by a nonprofit corporation that 
 qualifies under section 501(c)(3) of the Internal Revenue Code. 

    (2) The organization must spend at least $5,000 per 
 graduate of the program. 

    (3) The program must provide education and training in: 

    (i) basic skills, such as reading, writing, mathematics, 
 and communications; 

    (ii) thinking skills, such as reasoning, creative thinking, 
 decision making, and problem solving; and 

    (iii) personal qualities, such as responsibility, 
 self-esteem, self-management, honesty, and integrity. 

    (4) The program must provide income supplements, when 
 needed, to participants for housing, counseling, tuition, and 
 other basic needs. 

    (5) The education and training course must last for at 
 least six months. 

    (6) Individuals served by the program must: 

    (i) be 18 years old or older; 

    (ii) have had federal adjusted gross income of no more than 
 $10,000 per year in the last two years; 

    (iii) have assets of no more than $5,000, excluding the 
 value of a homestead; and 

    (iv) not have been claimed as a dependent on the federal 
 tax return of another person in the previous taxable year. 

    (7) The program must charge placement and retention fees 
 that exceed the amount of credit certificates provided to the 
 employer by at least 20 percent. 

    (b) The program must be certified by the commissioner of 
 children, families, and learning as meeting the requirements of 
 this subdivision. 

    Subd. 3.    Qualified graduate.  A qualified graduate is 
 a graduate of a job training program qualifying under 
 subdivision 1, who is placed in a job in Minnesota that pays at 
 least $9 per hour or its equivalent.  To qualify for a credit 
 under this section for a retention fee, a job in which the 
 graduate is retained must pay at least $10 per hour at the end 
 for the first and second years of employment.  A business, other 
 than the business that originally hired the graduate, may pay a 
 retention fee for the graduate and qualify for the credit. 

    Subd. 4.    Duties of program.  (a) Each program 
 certified by the commissioner under subdivision 2 must comply 
 with the requirements of this subdivision. 

    (b) Each program must maintain records for each graduate 
 for which the program provides a credit certificate to an 
 employer.  These records must include information sufficient to 
 verify the graduate's eligibility under this section, identify 
 the employer, describe the job including its compensation rate 
 and benefits, and determine the amount of placement and 
 retention fees received. 

    (c) Each program must report to the commissioner of revenue 
 by January 1, 1999, and by January 1, 2001, on its use of the 
 credit.  Each report must include, at least, information on: 

    (1) the number of graduates placed; 

    (2) demographic information on the graduates; 

    (3) the types of position in which each graduate is placed, 
 including compensation information; 

    (4) the tenure of each graduate at the placed position or 
 in other jobs; 

    (5) the amount of employer fees paid to the program; 

    (6) the amount of money raised by the program from other 
 sources; and 

    (7) the types and sizes of employers with which graduates 
 have been placed and retained. 

    (d) The commissioner shall compile and summarize this 
 information and report to the legislature by February 15, 1999, 
 and February 15, 2001.  

    Subd. 5.    Issuance of credit certificates.  (a) The 
 total amount of credits under this section is limited to 
 $1,200,000 for taxable years beginning after December 31, 1996, 
 and before January 1, 2002.  The commissioner may issue under 
 paragraph (b) no more than the specified amount of certificates 
 for taxable years beginning during each calendar year: 

        1997            $100,000
        1998            $200,000
        1999            $300,000
        2000            $300,000
        2001            $300,000

    Unused certificates for a taxable year carry over and may 
 be used for a later taxable year, regardless of when issued by 
 the commissioner. 

    (b) Upon application, the commissioner of children, 
 families, and learning shall issue certificates to job training 
 programs, certified under subdivision 2, up to the dollar amount 
 available for the taxable year.  The certificates must be in a 
 dollar amount that is no greater than the dollar amount applied 
 for, and reflects the commissioner's estimate of the job 
 training program's projected fees for placements and retentions 
 of qualifying graduates.  The commissioner shall issue the 
 certificates in the order in which applications are received 
 until the available authority has been issued. 

    (c) To the extent available, the job training program must 
 provide to employers of its qualified graduates certificates 
 issued by the commissioner of children, families, and learning 
 under this subdivision. 

    Subd. 6.    Nonrefundable.  The taxpayer must use the 
 tax credit for the taxable year in which the certificate is 
 issued to the employer.  The credit for the taxable year may not 
 exceed the liability for tax under section 290.06, subdivision 
 1, for the taxable year, before reduction by the nonrefundable 
 credits allowed under this chapter. 

    Subd. 7.    Manner of claiming.  The commissioner shall 
 prescribe the manner in which the credit may be claimed.  This 
 may include allowing the credit only as a separately processed 
 claim for a refund. 

    Subd. 8.    Expiration.  This section expires effective 
 for taxable years beginning after December 31, 2001. 

    HIST: 1997 c 231 art 5 s 8