S-1767

AN ACT Relating to business tax credits for assisting in the provision of child care; adding new sections to chapter 82.04 RCW; providing an effective date; and declaring an emergency.

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

NEW SECTION. Sec. 1. (1) The legislature finds that all benefit when employers and child care providers forge partnerships that enhance the stability of the family and facilitate expanded economic prosperity in this state. The participation of both parents in the work force has resulted in the demand for affordable child care exceeding the supply in many communities. When child care is conveniently available to workplaces and in neighborhoods, the benefits to families, children, and the employer are many. For both the employer and employee, the benefits include reduced absenteeism, improved recruitment opportunities, and improved morale. Community agencies that assist employers and employees in establishing and locating child care exist in many communities and can also be part of the partnership between employers and employees.

(2) It is the intent of the legislature to change the state tax structure to encourage the stability of families and the work force through the delivery of child care in partnership with employers.

NEW SECTION. Sec. 2. (1) In computing the tax due under this chapter, a credit against the amount of tax is allowed for money spent or space provided for child care or assisting off-site child care programs, as provided in this section and sections 3 and 4 of this act. (2) For on-site child care space provided by a single taxpayer, the available credit in each tax year is three dollars per square foot for space provided exclusively for child care. In each tax year, an additional one dollar per square foot of space may be taken as a credit for each of the following provided by a child care facility: (a) A quality outside play area, (b) sick leave, vacation, and health benefits for employees of the child care facility, (c) care for handicapped children, and (d) after one year of operation, accreditation by the national association of the education of young people.

(3) For centrally located on-site or off-site child care space that is provided jointly by two or more taxpayers, the available credit is based on the criteria in subsection (1) of this section but is prorated between the taxpayers providing the child care.

(4) For assisting off-site child care that does not fall under subsection (2) or (3) of this section, such as subsidizing local child care centers, establishing or subsidizing a local family child care home network, or otherwise working with community organizations to provide child care services, the available credit is up to twenty-five percent of the amount expended in any tax year.

(5) The credits allowed under this section are per child care facility or program established or assisted by a taxpayer. A taxpayer may take credits for one or more child care facilities or programs.

NEW SECTION. Sec. 3. (1) The credits allowed under section 2 of this act are available only if the child care is provided in this state and meets all the state and local requirements regarding the provision of child care, including licensing and operating the child care facility.

(2) The child care facility may, when space is available, provide care for the children of persons not employed by the taxpayer requesting the credit under section 2 of this act. However, if the taxpayer is providing child care for its own employees, the taxpayer's involvement in child care shall be generally proportionate to the expected needs of the employees or, if the taxpayer is a property owner, to the expected needs of employees of businesses located on the property.

(3) Credits allowed under section 2 of this act are not available when any space provided for child care is donated.

(4) Credits allowed under section 2 of this act shall be limited to a maximum of three hundred square feet per full-time child. The number of full-time children shall be certified to the department by the taxpayer as of the last day of the last month of the taxpayer's tax year. For the purposes of this subsection, "full-time child" is a child that receives child care for an average of at least six hours per day.

NEW SECTION. Sec. 4. The total amount of credits allowed to taxpayers under section 2 of this act shall not exceed one million two hundred fifty thousand dollars in fiscal year 1991 and two million five hundred thousand dollars for each fiscal year thereafter.

NEW SECTION. Sec. 5. The department of trade and economic development in consultation with the business assistance center and the department of revenue shall jointly adopt rules deemed necessary by the departments to carry out sections 1 through 4 of this act, including rules for applying for the credits allowed under sections 1 through 4 of this act and for prioritizing credits on the basis of need and the greatest public benefit when the limits established under section 4 of this act may be exceeded. These departments shall report to the house of representatives commerce and labor committee and the senate commerce and labor committee in writing on sections 1 through 4 of this act in December 1993, and shall include any recommendations the departments may have.

NEW SECTION. Sec. 6. Sections 1 through 5 of this act are each added to chapter 82.04 RCW.

NEW SECTION. Sec. 7. This act is necessary for the immediate preservation of the public peace, health, or safety, or support of the state government and its existing public institutions, and shall take effect July 1, 1991.