Act No. 323

Public Acts of 2006

Approved by the Governor

July 20, 2006

Filed with the Secretary of State

July 20, 2006

EFFECTIVE DATE: July 20, 2006

STATE OF MICHIGAN

93RD LEGISLATURE

REGULAR SESSION OF 2006

Introduced by Reps. Sheen, Drolet, Waters, McConico, Anderson, Stewart, Zelenko, Kolb, Lipsey, Kooiman, Meyer, Hummel, Vander Veen, Williams, Adamini, Brown, Gaffney, Virgil Smith, Hunter, Tobocman, Farrah, LaJoy, Hopgood, Kathleen Law, Bieda, Meisner, Wojno, Clack, Condino, Vagnozzi, Taub, Accavitti, Stakoe, Garfield, Hune, Gleason, Hoogendyk, Nofs, Wenke, Byrum, Steil, Sak, Nitz, Stahl, Huizenga, Moolenaar, Gillard, Dillon, Angerer, Ball, Baxter, Bennett, Booher, Byrnes, Caul, Cheeks, Clemente, Cushingberry, Donigan, Elsenheimer, Espinoza, Gonzales, Gosselin, Green, Hansen, Hildenbrand, Jones, Kahn, David Law, Leland, Lemmons, III, Lemmons, Jr., Marleau, McDowell, Miller, Moore, Palmer, Pavlov, Pearce, Polidori, Proos, Rocca, Schuitmaker, Sheltrown, Spade and Murphy

ENROLLED HOUSE BILL No. 4971

AN ACT to amend 1975 PA 228, entitled "An act to provide for the imposition, levy, computation, collection, assessment and enforcement, by lien or otherwise, of taxes on certain commercial, business, and financial activities; to prescribe the manner and times of making certain reports and paying taxes; to prescribe the powers and duties of public officers and state departments; to permit the inspection of records of taxpayers; to provide for interest and penalties on unpaid taxes; to provide exemptions, credits, and refunds; to provide penalties; to provide for the disposition of funds; to provide for the interrelation of this act with other acts; and to provide an appropriation," (MCL 208.1 to 208.145) by adding section 32.

The People of the State of Michigan enact:

Sec. 32. (1) For tax years that begin on or after January 1, 2006 and end before January 1, 2016, a taxpayer that is engaged in research and development of a qualified technology may claim a credit against the tax imposed by this act equal to 3.9% of the compensation as defined in section 4 for services performed in a qualified facility, paid to the employees at the qualified facility in the tax year, if the taxpayer has entered into an agreement before January 1, 2007 with the Michigan economic growth authority that provides all of the following:

(a) The type and number of jobs at the qualified facility to which the agreement applies.

(b) The type of work to be performed by the employees performing the jobs provided under subdivision (a) by the taxpayer.

(c) Any other terms and conditions that the Michigan economic growth authority considers to be in the public interest.

(2) If the credit allowed under this section exceeds the tax liability of the taxpayer for the tax year, that portion that exceeds the tax liability shall be refundable.

(3) The maximum amount of the credit allowed under this section that any 1 taxpayer may claim shall not exceed $3,000,000.00 in a single tax year.

(4) As used in this section:

(a) "Michigan economic growth authority" means the Michigan economic growth authority created in the Michigan economic growth authority act, 1995 PA 24, MCL 207.801 to 207.810.

(b) "Motor vehicle" means a motor vehicle as defined in section 33 of the Michigan vehicle code, 1949 PA 300, MCL257.33, that is designed as a passenger vehicle, or sport utility vehicle, but does not include a motor home, bus, truck other than a pickup truck or van, or a vehicle designed to travel on less than 4 wheels.

(c) "Qualified city" means a city that meets both of the following criteria:

(i) Has a population of not less than 80,000 and not more than 82,000 as designated by the United States bureau of the census in the 2000 census.

(ii) Is located in a county that has a population of not less than 1,000,000 and not more than 1,300,000 as designated by the United States bureau of the census in the 2000 census.

(d) "Qualified facility" means a leased facility in a qualified city used exclusively for the research and development of a qualified technology.

(e) "Qualified technology" means a 2-mode hybrid system the primary purpose of which is the propulsion of a motor vehicle.

(f) "Research and development" means "qualified research" as that term is defined in section 41(d) of the internal revenue code.

This act is ordered to take immediate effect.

Clerk of the House of Representatives

Secretary of the Senate

Approved

Governor