COVID-19 ECONOMIC RECOVERY GRANTS. (NEW)

View NCGA Bill Details2019-2020 Session
Senate Bill 848 (Public) Filed Tuesday, May 26, 2020
AN ACT TO PROVIDE ECONOMIC SUPPORT TO BUSINESSES FOR JOB RETENTION, RECRUITMENT, AND REPATRIATION DURING AND AFTER THE COVID-19 3 PANDEMIC.
Intro. by Newton, Hise, Tillman.

Status:

SOG comments (1):

Long title change

Senate committee substitute to the 1st edition changed the long title.  Original title was AN ACT TO PROVIDE A TEMPORARY FRANCHISE TAX CREDIT FOR CORPORATIONS THAT RETAINED EMPLOYMENT LEVELS AND MADE INVESTMENTS IN NORTH CAROLINA DURING AND AFTER THE COVID-19 PANDEMIC AND TO APPROPRIATE FUNDS FROM THE CORONAVIRUS RELIEF RESERVE TO THE GENERAL FUND FOR THE FRANCHISE TAX CREDIT AND THE ONE NORTH CAROLINA GRANT PROGRAM.

Bill History:

No bill history found
S 848

Bill Summaries:

  • Summary date: Jun 19 2020 - More information

    Senate amendment to the 3rd edition makes the following changes. 

    Modifies eligibility under the job investment grant program established in the act to exclude businesses and nonprofits that participated in the NC Rapid Recovery Loan Program provided under SL 2020-4 (2020 COVID-19 Recovery Act).


  • Summary date: Jun 17 2020 - More information

    Senate committee substitute to the 2nd edition makes the following changes. 

    Amends Section 1 to include nonprofits as entities eligible to receive grants under the Job Retention Program. Defines nonprofit as an entity exempt from income tax under GS 105-130.11(a)(3) or GS 105-130.11(a)(6). Restricts eligibility to nonprofits whose gross receipts for the COVID-19 period, as defined, are at least 10% below its gross receipts for the same period in the preceding calendar year. Makes conforming changes to other sections.

    Amends Section 1 to change Mainstreet Loan Program to Mainstreet Lending Program. Makes conforming changes to other sections.

    Amends Section 2(c) to specify that appropriations in Sections 3(g), 4(h), and 5(c) of the act do not become effective unless funds are allowed to be expended pursuant to the federal CARES Act requirements and federal Treasury guidance.

    Adds new Section 2(d) to specify that the requirements and limitations set forth in Part I of SL 2020-4 apply to the funds appropriated.Directs the Office of State Budget and Management to include the funds transferred and appropriated in the report required under Section 1.7 of SL 2020-4.

    Amends Section 3(d) related to Job Investment grant program to specify that the total of all funds granted under the program may not exceed $50 million. Directs the Economic Investment Committee to calculate the total amount of grants requested from the applications timely filed and to proportionately reduce each grant award of the total amount requested exceeds this amount (previously, provided for a $50,000 grant award cap, provided on a first-come, first-served basis). Amends Section 3(e) to set an application deadline of September 1, 2020.

    Amends Sections 3(g), 4(h), and 5(c)  to specify that the appropriations are subject to the contingency set forth in Section 2.(c), requiring compliance with the requirements of the federal CARES Act and federal Treasury guidance.

    Amends Section 4(a) to specify that the purpose of the Increased Investment grant program is to invent increased investment in the State in 2020 and 2021. 

    Amends Section 4(c) to specify that to be eligible for a grant, the Economic Investment Committee must find that the total benefit of a business' investment to the State under the grant appropriate for the investment.  

    Amends Section 4(h) to change the date by which unexpended funds revert from December 30, 2022 to December 31, 2023.

    Adds new Section 5.1 to authorize the Department of Commerce to use up to 5% of the amount of funds appropriated to each program created pursuant to this act for administration of each program, respectively.

    Adds two new sections to reenact and incorporate the State Budget Act, GS 143C, by reference, and to provide for the continued validity of 2019 legislative appropriating funds to entities covered by the act, unless expressly repealed or amended.


  • Summary date: Jun 11 2020 - More information

    Senate committee substitute deletes the content of the 1st edition and instead provides the following.

    Section 1

    States the purpose of the act regarding the use of funds from the Coronavirus Relief Fund to help NC businesses during and business investments after the COVID-19 pandemic.  

    Section 2

    Directs the State Controller to transfer $200 million from the Coronavirus Relief Reserve to the Coronavirus Relief Fund (both established in SL 2020-4). Appropriates the transferred funds to the General Fund for 2020-21 to implement the act, subject to federal CARES Act requirements and specified US Treasury guidance, for job retention, recruitment, and repatriation. 

    Section 3

    Establishes the COVID-19 Job Retention Program (program), administered by the Economic Investment Committee (Committee), to provide one-time grants of up to $500,000 to a business that retained jobs during and after the COVID-19 pandemic and meets program requirements. Limits program eligibility to businesses that: (1) employ at least 90% of the number of full-time or equivalent employees during the COVID-19 period in NC as it employed for the pay period ending on or about February 28, 2020; (2) have sales for the COVID-19 period that are at least 10% below its sales during the same period in the preceding calendar year; and (3) did not participate in the Paycheck Protection Program (PPP) or the Mainstreet Loan Program. Provides nine defined terms. Defines a business to mean an entity subject to income tax, and defines the COVID-19 period to mean the period beginning March 1, 2020, and ending May 31, 2020. Provides for grants awards to be up to two months of the business's average monthly payroll costs, as defined, from the last year plus an additional 25%. Provides for the grants to be awarded on a first-come, first-served basis upon application to the Committee. 

    Additionally appropriates $50 million from the General Fund to the Department of Commerce to be used for the program. Directs funds unexpended on December 30, 2020, to be transferred to the COVID-19 Increased Investment in North Carolina Program (investment program), established by the act, for investment program grants. 

    Section 4

    Establishes the increased investment program, administered by the Committee, to provide grants to businesses that increase its investment in the State to help the State economy recover from the economic losses sustained during and after the COVID-19 pandemic. Defines eligibility to include businesses that increase its actual investment in tangible property in the State from the previous taxable year, as specified. Defines a business to mean a corporation subject to franchise tax. Provides for grant amounts to equal five times the increased investment amount multiplied by 15%, payable to businesses in five equal installments over a five-year period. Provides for the grants to be awarded on a first-come, first-served basis upon application to the Committee. Conditions the grant award on the business's commitment to maintain operations in NC for the term of the grant with Committee authority to recapture awarded funds in the event of noncompliance. 

    Appropriates $50 million from the General Fund to the Department of Commerce to be used for the investment program. Directs funds unexpended on December 30, 2022, to be transferred to the COVID-19 Local Government New Infrastructure Program (local government program), established by the act.

    Section 5

    Establishes the local government new infrastructure program, administered consistent with the One North Carolina Fund provisions set out in Part 2H, Article 10 of GS Chapter 143B, to expedite recovery from economic loss during and after the COVID-19 pandemic. Explicitly states that no local matching is required for awards under the local government program. Restricts awards to availability of funds provided in the section.

    Appropriates $100 million from the General Fund to the Department of Commerce. Allows up to $6 million to be allocated to one or more of the State's eight prosperity zones upon recommendation of the Committee, with no prosperity zone receiving more than $750,000 and restricts the use of funds for State match purposes. Allocates the remainder of the funds for the local government program.

    Directs the Department of Commerce to notify the Office for Historically Underutilized Businesses as soon as practicable about the three programs created by the act, and directs the Office to identify and inform minority owned businesses that may be eligible for program grants.

    Directs the Committee to report to the specified NCGA committee by January 1, 2021, on program awards, including the total number, of awards and amounts, and the percentage of grants awarded to historically underutilized businesses. 

    Changes the act's titles.


  • Summary date: May 27 2020 - More information

    Enacts GS 105-122.2 to establish a tax credit for corporations, effective for taxable years beginning on or after January 1, 2020, and applicable to the calculation of franchise tax reported on 2019 and later corporate income tax returns. Limits credit eligibility to corporations which either (1) increases its total actual investment in tangible personal property in the State from the previous taxable year, or (2) retains employment for the taxable year at a level at least equal to 90% of the number of full-time employees employed on March 31, 2020, and the average wage paid is at least equal to 90% of the average wages paid to full-time employees employed on March 31, 2020, based on the unemployment tax filing for the quarter, excluding employee salaries in excess of $200,000, and wage of part-time employees. Bars holding companies from eligibility based upon investment in the State, but allows for eligibility of a holding company if the only asset is an investment in a wholly owned operating subsidiary in the State, or an investment in a wholly owned holding company in the State whose only asset is an investment in a wholly owned operating subsidiary in the State who meets the employment retention eligibility requirements of the statute. Provides for credit application and requires application by October 15. Caps the credit amount for taxable years 2020 and 2021 at $50 million each. Prohibits the credit amount from exceeding the tax imposed, but allows for proportional allocation of the credit. Bars credit carry forward. Bars adjustments to account for credits. Requires refund of the credit amount by the last day of the calendar year. Repeals the credit for taxable years beginning on or after January 1, 2022.

    Directs the State Controller to transfer $100 million from the Coronavirus Relief Reserve to the Coronavirus Relief Fund (both established by SL 2020-4). Appropriates the $50 million of the transferred funds to the General Fund for each of the 2020-21 and 2021-22 fiscal years to provide the tax relief authorized. Requires expenditures to be consistent with the federal CARES Act.

    Directs the State Controller to transfer $50 million from the Coronavirus Relief Reserve to the Coronavirus Relief Fund (both established by SL 2020-4). Appropriates the transferred funds to the Department of Commerce for the 2020-21 fiscal year to provide grants to businesses to be used for purposes for authorized for a One North Carolina Fund grant as specified under state law governing that Fund. Restricts grant eligibility to businesses who are current recipients of a Job Development Investment Grant or a Job Maintenance and Capital Development grant. Otherwise, requires businesses to apply to the Secretary of Commerce. Provides for the grant terms to be similar to those under specified state law regarding such grants and community development agreements. Requires expenditures to be consistent with the federal CARES Act. 


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