Business Facilities - January 2008 - (Page 21) the state (125% of the average annual wage paid to all covered workers in 2004 was equal to $46,351); or • The average annual wage paid to the employer’s full-time equivalent employees classified as production workers (as defined by the Department of Labor and Training) is greater than the average annual wage paid to all production workers in the state in the same two-digit SIC code; or • The firm invests at least 2% of total payroll costs in worker training or retraining. Biotechnology-related firms wishing to use the Investment Tax Credit beyond seven years must, for each tax year, maintain an average quarterly employment level that is at least 9.5% above the level maintained in the fourth year of the initial credit, and pay an average quarterly median wage is at least equal to the quarterly median wage for the previous three calendar years. RESEARCH & DEVELOPMENT EXPENSE CREDIT: Rhode Island offers a 22.5% tax credit for increases in qualified research expenses—the highest rate in America. Unused credits may be carried forward for up to seven years. JOB TRAINING TAX CREDIT: Rhode Island law grants a credit against the corporate income tax (or the insurance premium tax) equal to 50% of eligible training expenditures for new or existing employees, in accordance with an approved training plan. Employees must be full-time, and after training, the employee must earn at least 150% of the Rhode Island minimum wage. The credit is capped at $5,000 per employee over a three-year period. SOUTH CAROLINA SOUTH CAROLINA CREDIT FOR INFRASTRUCTURE CONSTRUCTION allows a corporation a credit against corporate income tax or bank tax equal to 50% of the contributions or expenses paid or accrued by the taxpayer for the construction or improvement of water lines, sewer lines, and road projects that are eventually dedicated to public use or a qualifying private entity. The COMMERCIAL PRODUCTION CREDIT allows a production company producing commercials for multi-market distribution via television networks, cable, satellite, or motion picture theaters an income tax credit equal to 10% of its South Carolina investment in such commercials during the calendar year. Any unused credit may be carried forward for 10 years. BROWNFIELDS VOLUNTARY CLEANUP CREDIT allows a corporation a credit against corporate income taxes for costs of voluntary cleanup activity by a non-responsible party pursuant to the Brownfields Voluntary Cleanup Program. The “basic”credit amount is equal to 50% of the cleanup expenses paid or accrued or cash contributions for site cleanup conducted during the tax year the tax credit application is submitted, not to exceed $50,000 in a tax year. An “additional” credit equal to 10% of the total cleanup costs, not to exceed $50,000, is allowed in the final year of cleanup. THE CORPORATE HEADQUARTERS CREDIT is available to a corporation that establishes a corporate headquarters in the state, or expands or adds to an existing corporate headquarters. The credit may be taken against corporate income tax or corporate license fees imposed and equals 20% of the qualifying costs. The credit may be carried forward for 10 years, up to 15 years. THE PALMETTO SEED CAPITAL CREDIT allows a business credit for qualified investments in the Palmetto Seed Capital Corporation or the Palmetto Seed Capital Fund Limited Partnership against income or bank taxes or insurance premium taxes. The credit is equal to the lesser of all qualified investments during the tax year multiplied by 30%, plus any credit carryover. SOUTH DAKOTA The AGRICULTURAL PROCESSING AND EXPORT (APEX) FUND provides up to 75% of the total project cost and requires the applicant to secure the other funds before applying for the APEX loan, including a 10% minimum equity contribution. The maximum loan amount available from the APEX program is $237,500. Eligible project costs include the purchase of land and the associated site improvements; the purchase and installation of machinery and equipment; the construction, acquisition, or renovation of a building; and fees, services, and other costs associated with construction. Interest rates are between 5% and 7%, depending upon the risk of the project and the amount of participation by APEX. The REVOLVING ECONOMIC DEVELOPMENT AND INITIATIVE (REDI) FUND is a lowinterest loan fund available to start-up firms, businesses that are expanding or relocating, and local economic development corporations. The REDI Fund provides up to 45% of a project’s total cost. THE MICROLOAN SOUTH DAKOTA LOAN PROGRAM: These loans are made available to small businesses within the borders of South Dakota and to South Dakota residents, including main street and retail operations. The loan is for working capital, equipment, real estate, or other fixed asset project costs. TENNESSEE The SMALL BUSINESS ENERGY LOAN PROGRAM provides low-interest loans of up to $300,000 to qualified Tennessee-based businesses to help upgrade the level of energy efficiency in their buildings, plants, and to improve manufacturing processes. Companies with fewer than 300 employees or less than $3.5 million in annual gross sales or receipts are eligible to apply for loans to install insulation, double pane windows, energy efficient heating, cooling and ventilation equipment, and energy efficient lighting. CORPORATE EXCISE TAX CREDIT: Business receive a 1% excise tax credit for the purchase, installation, and/or repair of qualified industrial machinery; the purchase of qualified equipment associated with the required $500,000 capital investment by a distribution or warehouse facility; the purchase of computers, computer networks, software, computer systems, telephone systems, and any peripheral devices purchased to reach the “required capital investment” to qualify for the jobs tax credit. FRANCHISE TAX CREDIT: A tax credit of $2,000 (or $4,500 in special enhancement counties) per new full-time employee is available to businesses. To qualify for this assisBUSINESS FACILITIES 21
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