"NEW SECTION.  Sec. 1   A new section is added to chapter 82.08 RCW to read as follows:
     (1) A partial exemption from the tax imposed by RCW 82.08.020 is provided in the form of a refund for sales or charges made to a qualifying business for:
     (a) Tangible personal property used at an eligible computer data center;
     (b) Labor and services rendered in respect to installing tangible personal property in an eligible computer data center;
     (c) Tangible personal property that becomes an ingredient or component of an eligible computer data center in the constructing, altering, repairing, or improving of the data center; and
     (d) Labor and services in respect to constructing, altering, repairing, or improving an eligible computer data center.
     (2)(a) A qualifying business must establish within six years of the first day of the calendar quarter in which the business first receives a refund under this section that it has:
     (i) Increased employment in the state by a minimum of thirty-five family wage jobs from the date the eligible computer data center first became operational. For purposes of this subsection, family wage jobs are new permanent employment positions requiring forty hours of weekly work, or their equivalent, on a full-time basis and paying a wage equivalent to or greater than one hundred fifty percent of the per capita personal income of the county in which the qualified project is located. The qualifying business must provide health insurance coverage for employees; and
     (ii) Spent at least two hundred million dollars on qualifying expenditures before, on, or after the effective date of this act.
     (b) All previously refunded sales and use taxes are immediately due and payable for a qualifying business that does not meet the requirements of (a) of this subsection.
     (3) Before claiming an exemption under this section or section 2 of this act, a qualifying business must submit an application to the department and the department must approve the application. The application must include any information necessary, as required by the department, to allow the department to make a determination that a business is likely to meet the requirements of this section and qualify for the exemption under this section. The department must issue a decision on the application within ninety days of receipt. If the department fails to issue a decision, the application for the exemption is deemed to have been approved.
     (4)(a) A qualifying business claiming an exemption under this section or section 2 of this act must first pay state and local sales or use tax on sales or uses eligible for exemption under this section or section 2 of this act and may then apply to the department for a refund of fifty percent of the tax paid. The fifty percent exemption provided in this section and section 2 of this act applies to both the state and local portions of sales and use taxes.
     (b) A qualifying business claiming the exemption under this section or section 2 of this act must submit an application for a refund to the department, not more often than once per calendar quarter, in a form and manner as required by the department. The application must include the amount of exemption claimed, the purchases for which the exemption is claimed, and such other information that the department determines is necessary to determine eligibility for the exemption. A qualifying business claiming the exemption under this section or section 2 of this act must keep and preserve adequate records establishing the qualifying business's eligibility for the exemption. Pending or approved applications are subject to audit verification by the department.
     (c) The department must, on a quarterly basis, refund exempted amounts to qualifying businesses that submitted applications during the previous quarter that were approved, in whole or in part, by the department. The department may not refund more than twenty million dollars of state taxes under this section and section 2 of this act. Once the twenty million dollar amount is reached, the department may not provide refunds for state and local sales and use taxes. The fifty percent of state sales or use tax not refunded under this section or section 2 of this act must be deposited in the green industries jobs training account created in RCW 43.330.310. The department may not refund sales taxes under this section or use taxes under section 2 of this act before April 1, 2010. The department may not refund sales taxes under this section or use taxes under section 2 of this act to a qualifying business unless the eligible computer data center to which the sales or use tax applies has been granted a certificate of occupancy.
     (5) A qualifying business claiming an exemption under this section or section 2 of this act must complete an annual report with the department as required under section 103, chapter . . . (Substitute House Bill No. 1597), Laws of 2009.
     (6) With respect to the construction of an eligible computer data center, a qualifying business claiming an exemption under this section or section 2 of this act must comply with the prevailing wage requirements of chapter 39.12 RCW and must also use apprentices for no less than fifteen percent of the labor hours required.
     (7) The definitions in this subsection apply to this section.
     (a) "Computer data center" means a facility comprised of one or more buildings constructed or refurbished specifically, and used primarily, to house servers, where the facility has the following characteristics: (i) Uninterruptible power supplies, generator backup power, or both; (ii) sophisticated fire suppression and prevention systems; and (iii) enhanced physical security, such as: (A) Restricted access to the facility to selected personnel; (B) permanent security guards; video camera surveillance; or an electronic system requiring passcodes, keycards, or biometric scans, such as hand scans and retinal or fingerprint recognition; or (C) security features similar to those in (a)(iii)(A) and (B) of this subsection (7).
     (b) "Eligible computer data center" means a computer data center with at least twenty thousand square feet of floor space dedicated to housing working servers and located in a rural county as defined in RCW 82.14.370(5).
     (c) "Qualifying business" means a business entity that exists for the primary purpose of engaging in commercial activity for profit. For purposes of this definition, "business entity" means a corporation, other than a municipal, quasi-municipal, and public or other corporation created by the state or federal government, tribal government, municipality, or political subdivision of the state; association; limited liability company; partnership, including general partnership, limited partnership, and limited liability partnership; or other legal entity. Consistent with this definition, "business entity" does not include the state or federal government or any of their departments, agencies, and institutions; tribal governments; and political subdivisions of this state.
     (d) "Qualifying expenditure" means capital related expenditures of at least two hundred million dollars including, but not limited to, expenditures for: Land acquisition, land preparation, land improvement, facility design, facility construction, server and other equipment, and installation of server and other equipment.
     (8) The joint legislative audit and review committee must complete a tax preference review under RCW 43.136.055 for this section and section 2 of this act by January 1, 2011.
     (9) A qualifying business may not claim an exemption under this section or section 2 of this act for purchases made after June 30, 2011, by a qualifying business for tangible personal property or labor and services otherwise qualifying for an exemption under this section.

NEW SECTION.  Sec. 2   A new section is added to chapter 82.12 RCW to read as follows:
     (1) A partial exemption from the tax imposed under this chapter is provided in the form of a refund for uses by a qualifying business of:
     (a) Tangible personal property used at an eligible computer data center;
     (b) Labor and services rendered in respect to installing tangible personal property in an eligible computer data center;
     (c) Tangible personal property that becomes an ingredient or component of an eligible computer data center in the constructing, altering, repairing, or improving of the data center; and
     (d) Labor and services in respect to constructing, altering, repairing, or improving an eligible computer data center.
     (2) All of the conditions, requirements, limitations, and definitions in section 1 of this act apply to this section."