BP BHEAD INT S [atlas:bill]

AN ACT Relating to providing tax credits for businesses making expenditures for work force training; adding a new section to chapter 82.04 RCW; adding a new section to chapter 82.16 RCW; and providing an effective date.

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

NEW SECTION. Sec. 1. A new section is added to chapter 82.04 RCW to read as follows:

(1) A person whose application has been approved by the department under this section may take a credit against tax imposed by this chapter, subject to the limitations in this section. For the purposes of this section, "employer" means the same as "person" as defined in this chapter. The credit under this program is only available to persons with five hundred or fewer employees.

(2)(a) The credit under this section is equal to fifty percent of the amount of qualifying costs for work force training payments. A person may not receive credit for amounts over five thousand dollars annual training costs per employee. A person is not eligible to receive total credits over two hundred fifty thousand dollars per calendar year. A person may only receive credit for amounts expended on job classes covered by the federal fair labor standards act.

(b) As a precondition to approval by the department under subsection (4) of this section, the person must have entered into a training contract with a public or private accredited training institution. The work force training and education coordinating board shall provide a list of accredited institutions to interested persons and to the department. The training contracts must be for the training of at least five employees. If am employer does not have five employees to train, the person may coordinate with other employers who have identical training needs to create groups to meet the five person threshold.

(3) "Work force training payments" means the direct payments made under a contract with a public or private accredited training institution for formal technical or skill training, including basic skills. The term includes amounts in the contract for costs of instruction, materials, equipment, rental of class space, marketing, and overhead. "Work force training payments" do not include employee tuition reimbursements. Unless the tuition reimbursement is specifically included in a contract under subsection (2)(b) of this section.

(4) Application for credits under this section shall be made to the department in a form and manner as required by the department. The application shall include an affidavit affirming the person's compliance with this section. The department shall approve or deny application for credits using the criteria under this section. The department shall require the person receiving approval to keep such records as are necessary for the department to verify eligibility under this section. A person shall apply for the credit after making an expenditure. Tax credit applications shall not be approved for expenditures that occurred before the effective date of this act.

(5) Tax credits are available on a first-come basis, with priority based on the date and time the application is received by the department. The total of credits granted under this section and section 2 of this act shall be no more than ten million dollars of credits each fiscal year, with two million five hundred thousand dollars of the ten million dollars to be set aside and allocated exclusively for training for jobs in a distressed county. "Distressed county" means a county in which the average level of unemployment for the three years before the year in which an application is filed under this section exceeds the average state unemployment for those years by twenty percent. The department shall keep a running total of all credits approved. If the amount submitted for a credit will cause the cap to be exceeded, the department shall give a partial approval of the application, equal to the amount of remaining credit available for the fiscal year.

(6) No person is eligible for tax credits under this section in excess of the amount of tax that would otherwise be due under this chapter. Approved credit may not be carried over to subsequent calendar years. The credit must be claimed by the due date of the last tax return for the calendar year in which the payment is made. Any unused credit expires. Refunds shall not be given in place of credits.

(7) If a person has used a credit granted under this section against tax due under chapter 82.16 RCW the person may not use the same credit for tax due under this chapter.

(8) A person who takes credits under RCW 82.04.4333 may not take a credit under this section for the same training.

NEW SECTION. Sec. 2. A new section is added to chapter 82.16 RCW to read as follows:

The tax credit program under section 1 of this act is available to persons for tax due under this chapter. If a person has used a credit granted under this section against tax due under chapter 82.04 RCW, the person may not use the same credit for tax due under this chapter. A person who takes credits under RCW 82.04.4333 may not take a credit under this section for the same training.

NEW SECTION. Sec. 3. This act takes effect July 1, 1998.