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Substitute House Bill No. 5431

PUBLIC ACT NO. 96-239

AN ACT CONCERNING ENTERPRISE ZONES.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. Subsection (b) of section 32-80 of the general statutes, as amended by section 1 of public act 95-250, is repealed and the following is substituted in lieu thereof:

(b) The legislative bodies of three or more contiguous municipalities, each of which is a public investment community and has a population of not more than [thirty] THIRTY-FIVE thousand, and at least fifty per cent of which municipalities are located along the same interstate highway, limited access state highway or intersecting interstate or limited access state highways, may, with the approval of the commissioner, designate industrial districts in such municipalities as an enterprise corridor zone.

Sec. 2. Subsection (a) of section 32-70 of the general statutes, as amended by section 1 of public act 95-250, is repealed and the following is substituted in lieu thereof:

(a) Any municipality that was a distressed municipality under the provisions of subsection (b) of section 32-9p on February 1, 1986, may, with the approval of the Commissioner of Economic and Community Development, designate an area of such municipality as an enterprise zone. Any such area shall consist of one or two contiguous United States census tracts, contiguous portions of such census tracts or a portion of an individual census tract, as determined in accordance with the most recent United States census and, if such area is covered by zoning, a portion of it shall be zoned to allow commercial or industrial activity. The census tracts within which such designated area is located shall also meet at least one of the following criteria: (1) Twenty-five per cent or more of the persons within the individual census tracts shall have income below the poverty level, as determined by the most recent United States census, as officially updated by the appropriate state agency or institution; (2) twenty-five per cent or more of the families within the individual census tracts shall receive public assistance or welfare income, as determined by the most recent United States census, as officially updated by the appropriate state agency or institution; or (3) the unemployment rate of the individual census tracts shall be at least two hundred per cent of the state's average, as determined by the most recent United States census, as officially updated by the appropriate state agency or institution. In calculating any such percentage for one or two contiguous census tracts, contiguous portions of census tracts or a portion of an individual census tract, the commissioner shall round up to the nearest whole percentage number. If a census tract qualifies under the eligibility criteria for designation as an enterprise zone and if the commissioner determines that a census tract which is contiguous to such tract has significant job creation potential, the commissioner may include such contiguous census tract, or a portion thereof, in the enterprise zone in lieu of a second qualified census tract if such contiguous census tract meets at least one of the following reduced criteria: (A) Fifteen per cent or more of the persons within the census tract shall have income below the poverty level, as determined by the most recent United States census, as officially updated by the appropriate state agency or institution; (B) fifteen per cent or more of the families within the census tract shall receive public assistance or welfare income, as determined by the most recent United States census, as officially updated by the appropriate state agency or institution; or (C) the unemployment rate of the census tract shall be at least one hundred fifty per cent of the state's average, as determined by the most recent United States census, as officially updated by the appropriate state agency or institution. If a census tract boundary line is the center line of a street, the commissioner may include within the enterprise zone that portion of the property fronting on such street which is outside of but adjacent to the census tract. The depth of such property so included in the enterprise zone shall be determined by the commissioner at the time of the designation of the zone. If a census tract boundary line is located along a railroad right-of-way, railroad property or natural stream of water, the commissioner may include within the enterprise zone any private properties under common ownership which are traversed by the railroad right-of-way, railroad property or natural stream of water. Any private properties so affected shall be included in the enterprise zone at the time of the designation of the zone except, in the case of an enterprise zone designated prior to October 1, 1983, the commissioner may include within the zone any such property if the municipality in which the zone is located requests the commissioner to include such property not later than sixty days after October 1, 1983. If more than twenty-five per cent of the project area of a development project under chapter 132 is located in an area eligible for designation as an enterprise zone and the project plan for such development project is approved by the Commissioner of Economic and Community Development in accordance with section 8-191, the commissioner may include the entire project area of such development project area in an enterprise zone. If more than twenty-five per cent of the project area of a municipal development project under chapter 588l is located in an area eligible for designation as an enterprise zone and the development plan for such project is approved by the Commissioner of Economic and Community Development in accordance with section 32-224, the commissioner may include the entire project area of such project in an enterprise zone. If more than fifty per cent of an approved redevelopment area under chapter 130 is located in an area eligible for designation as an enterprise zone, the commissioner may include the entire redevelopment area in an enterprise zone. The commissioner may also include in the area designated as an enterprise zone (i) any facility, as defined in section 32-9p, which is located outside of but contiguous to a census tract included in the zone [or] (ii) any private properties which are (I) under common ownership, (II) located outside of a census tract included in the zone and (III) contiguous to a railroad right-of-way which is the boundary of such a census tract OR (iii) ANY PRIVATE PROPERTIES WHICH ARE LOCATED OUTSIDE OF A CENSUS TRACT INCLUDED IN THE ZONE, BUT BETWEEN THE ZONE AND A RAILROAD RIGHT-OF-WAY, WHERE OTHER SEGMENTS OF SUCH RAILROAD RIGHT-OF-WAY SERVE AS BOUNDARIES FOR THE ZONE. The commissioner may, at any time after the designation of an area as an enterprise zone, include in such zone any area contiguous to such zone which, at the time of the designation of such zone, was eligible to be included in such zone but was not so included. The commissioner may, at any time after the designation of an area as an enterprise zone, include in such zone any property which is located within one hundred fifty feet of a stream, the center line of which is the boundary of a census tract included in such zone, and which property contains an existing building or facility, having an area equal to or greater than one hundred thousand square feet, that is or was formerly used for manufacturing purposes but is underutilized or vacant at the time the property is included in such zone. If the commissioner determines that the necessary data is not available from the most recent United States census, he may use such data as he deems appropriate.

Sec. 3. (NEW) (a) As used in this section, "qualifying corporation" means a corporation which is created on or after January 1, 1997, in an enterprise zone and which either (1) has at least three hundred seventy-five employees, at least forty per cent of whom (A) are residents of the enterprise zone or the municipality in which the enterprise zone is located and (B) qualify under the Job Training Partnership Act or (2) has less than three hundred seventy-five employees, at least one hundred fifty employees of whom (A) are residents of the enterprise zone or the municipality in which the enterprise zone is located and (B) qualify under the Job Training Partnership Act.

(b) There shall be allowed as a credit against the tax imposed on any corporation under chapter 208 of the general statutes, which is created on or after January 1, 1997, in an enterprise zone, in an amount equal to (1) one hundred per cent of the tax liability of the corporation under said chapter with respect to the first three taxable years of the corporation and (2) fifty per cent of the tax liability of the corporation under said chapter with respect to the next seven taxable years of the corporation.

Sec. 4. Subdivision (2) of subsection (c) of section 32-23x of the general statutes, as amended by section 1 of public act 95-250 and sections 12 and 21 of public act 95-257, is repealed and the following is substituted in lieu thereof: (2) The authority may make loans at the rate of interest to targeted businesses. The aggregate outstanding amount of any loans made under this subdivision to any one person, including affiliates, shall not exceed [two] THREE hundred [fifty] thousand dollars. The maximum term for repayment of any loan made under this subdivision shall not exceed (A) twenty years for real property; (B) ten years for machinery and equipment and (C) seven years for working capital. For the purposes of this subdivision and subdivision (3), working capital may include, but shall not be limited to, capital for expansion or restructuring of a business.

Sec. 5. Section 32-9l of the general statutes is repealed and the following is substituted in lieu thereof:

(a) An eligible business facility shall be granted an amount determined by multiplying [five hundred] SEVEN HUNDRED FIFTY dollars or, in the case of any facility used primarily for the manufacturing, processing or assembling of raw materials or manufactured products, or for research or industrial warehousing, or any combination thereof, and located in an enterprise zone designated pursuant to section 32-70, AS AMENDED BY SECTION 2 OF THIS ACT for which not less than one hundred fifty full-time employees or [thirty] FIFTY per cent of the full-time employment positions created by the facility are held by (1) residents of such zone, or (2) residents of such municipality who, at the time of employment, were eligible for training under the Federal Comprehensive Employment Training Act or any other training program that replaces the Comprehensive Employment Training Act, [one thousand five hundred] TWO THOUSAND TWO HUNDRED FIFTY dollars, by the increase in the number of full-time employment positions, the costs of which are paid by the eligible business, directly resulting from the construction, renovation or expansion of the business facility, as determined by the department taking into account the employment requirements of business expansion, historical levels of employment and employment positions prior to the expansion, and such other factors as the department may deem appropriate.

(b) Each business expansion of an applicant shall be treated separately by the department, and the department may establish a maximum number of employment positions for which benefits will be awarded under this section and sections 32-9j and 32-9p in order to make most effective use of the resources available for the job incentive grant program. The commissioner shall adopt regulations, in accordance with chapter 54, for the job incentive grant program and for grant eligibility thereunder.

Sec. 6. Section 32-9l of the general statutes, as amended by section 1 of public act 95-250, is repealed and the following is substituted in lieu thereof:

(a) An eligible business facility shall be granted an amount determined by multiplying five hundred dollars or, in the case of any facility used primarily for the manufacturing, processing or assembling of raw materials or manufactured products, or for research or industrial warehousing, or any combination thereof, and located in an enterprise zone designated pursuant to section 32-70, for which not less than one hundred fifty full-time employees or thirty per cent of the full-time employment positions created by the facility are held by (1) residents of such zone, or (2) residents of such municipality who, at the time of employment, were eligible for training under the Federal Comprehensive Employment Training Act or any other training program that replaces the Comprehensive Employment Training Act, one thousand five hundred dollars, by the increase in the number of full-time employment positions, the costs of which are paid by the eligible business, directly resulting from the construction, renovation or expansion of the business facility, as determined by the department taking into account the employment requirements of business expansion, historical levels of employment and employment positions prior to the expansion, and such other factors as the department may deem appropriate. IN THE CASE OF AN ELIGIBLE BUSINESS FACILITY LOCATED IN AN INDUSTRIAL DISTRICT DESIGNATED AS PART OF AN ENTERPRISE CORRIDOR ZONE UNDER SECTION 32-80, AS AMENDED BY SECTION 1 OF THIS ACT, THE TERM "SUCH MUNICIPALITY", AS USED IN THIS SUBSECTION, SHALL MEAN EITHER THE MUNICIPALITY IN WHICH THE FACILITY IS LOCATED OR ANY OTHER MUNICIPALITY HAVING AN INDUSTRIAL DISTRICT WHICH IS DESIGNATED AS PART OF THE SAME ENTERPRISE CORRIDOR ZONE.

(b) Each business expansion of an applicant shall be treated separately by the department, and the department may establish a maximum number of employment positions for which benefits will be awarded under this section and sections 32-9j and 32-9p in order to make most effective use of the resources available for the job incentive grant program. The commissioner shall adopt regulations, in accordance with chapter 54, for the job incentive grant program and for grant eligibility thereunder.

Sec. 7. (NEW) A municipality which has an enterprise zone designated under section 32-70 of the general statutes, as amended by section 2 of this act, and an abandoned or underutilized railroad depot which is located outside of the enterprise zone may, with the approval of the Commissioner of Economic and Community Development, designate the property on which such depot is located and the properties adjacent to such property as a railroad depot zone. Businesses located within a railroad depot zone shall be entitled to the same benefits, subject to the same conditions, under the general statutes for which businesses located in an enterprise zone qualify. The commissioner shall adopt regulations in accordance with the provisions of chapter 54 of the general statutes which (1) further define the term "railroad depot" for the purposes of this section, (2) establish an application procedure for municipalities seeking the approval of the commissioner for railroad depot zone designations, and (3) establish criteria for the issuance by the commissioner of approvals for such designations.

Sec. 8. (NEW) A municipality which has an enterprise zone designated under section 32-70 of the general statutes, as amended by section 2 of this act, and a manufacturing plant having an area of at least five hundred thousand square feet which is located outside of the enterprise zone may, with the approval of the Commissioner of Economic and Community Development, designate the manufacturing plant. A qualified manufacturing plant shall be entitled to the same benefits, subject to the same conditions, under the general statutes for which businesses located in an enterprise zone qualify. The commissioner shall adopt regulations in accordance with the provisions of chapter 54 of the general statutes which (1) further define the term "manufacturing plant" for the purposes of this section, (2) establish an application procedure for municipalities seeking the approval of the commissioner for qualified manufacturing plant designations, and (3) establish criteria for the issuance by the commissioner of approvals for such designations.

Sec. 9. Subsection (a) of section 32-222 of the general statutes, as amended by section 1 of public act 95-250, is repealed and the following is substituted in lieu thereof:

(a) "Business development project" means a project undertaken by an eligible applicant involving one or more of the activities described in subdivision (1), satisfying one or more of the criteria set forth in subdivision (2) or involving the activities described in subdivision (3), as follows: The project involves (A) the construction, substantial renovation, improvement or expansion of a facility; (B) the acquisition of an existing facility that has been idle for at least one year prior to such acquisition, provided if such facility is acquired through a lease, such lease: (i) Shall be for an initial term of not less than five years and (ii) shall be renewable at the option of the lessee for an additional term of not less than five years, provided the lease may be subject to the option of the lessee to purchase the facility at any time during the lease term or thereafter. The commissioner may waive the one year idleness requirement upon determination that there is a high likelihood that the facility will remain idle for one year. In making such determination, the commissioner shall consider the marketability of the facility, the general economic condition of the municipality in which the facility is located, the size of the facility, the economic benefit of the proposed acquisition to the municipality and the state, including, but not limited to, the number of employment positions proposed to be established at the facility, and the degree to which the provision of financial assistance under sections 32-220 to 32-234, inclusive, is necessary as an inducement to the eligible applicant to acquire the facility; (C) the acquisition of new machinery and equipment used directly in the manufacturing of goods or products and acquired through purchase as part of the technological upgrading of the manufacturing process of a facility used in the operation of a manufacturing or economic base business which (i) has been in continuous operation in the state for not less than five years; and (ii) has incurred costs in acquiring such machinery and equipment not less than the greater of two hundred thousand dollars, or two hundred per cent of the average annual expenditure of the manufacturing or economic base business for the acquisition of new machinery and equipment used directly in the manufacturing of goods or products at the facility during the three years prior to the date upon which an application for financial assistance is submitted pursuant to subsection (c) of section 32-222, or (D) the acquisition, improvement, demolition or disposition of real property, or combinations thereof, used or to be used in connection with the operation of a manufacturing or economic base business, provided, if the eligible applicant is not a municipality or implementing agency, the commissioner has determined that such project would not be undertaken or completed in a timely manner except for the provision of financial assistance pursuant to sections 32-220 to 32-234, inclusive, and that such project promotes the economic stability and growth of the state or any region thereof; (2) A project which will: (A) Create at a facility, within twenty-four months of the initiation of a hiring program, not less than ten new jobs or an increase in the number of persons employed at the facility of twenty per cent, whichever is greater; (B) promote the diversification of the economy of an area of the state or manufacturing or other economic base business where such area or business is substantially reliant upon defense and related industry; (C) assist in the avoidance of an imminent plant closing or relocation by a manufacturing or other economic base business or assist or improve the economy of an area of the state which has been or is likely to be significantly and adversely impacted by one or more major plant closings or relocations; (D) support research and development or commercialization of technologies, products, processes or techniques of a manufacturing or other economic base business; [or] (E) promote community conservation or development or improvement of the quality of life for urban residents of the state; OR (F) PROMOTE THE REVITALIZATION OF UNDERUTILIZED, STATE-OWNED FORMER RAILROAD DEPOTS AND AREAS ADJACENT TO SUCH DEPOTS (3) The project involves the creation of an inventors workshop by an eligible applicant, to enable (A) small manufacturing subcontractors which manufacture parts and components exclusively for other companies or (B) current or former manufacturing employees or higher education faculty or researchers, to design, test, manufacture and market new products and manufacturing techniques.

Sec. 10. Section 32-9p of the general statutes, as amended by section 1 of public act 95-250, is repealed and the following is substituted in lieu thereof:

As used in subdivisions (59) and (60) of section 12-81 AS AMENDED BY SECTION 11 OF THIS ACT and sections 12-217e, AS AMENDED BY SECTION 12 OF THIS ACT 32-9p to 32-9s, inclusive, AS AMENDED 32-23n and 32-23p, the following words and terms have the following meanings:

(a) "Area of high unemployment" means, as of the date of any final and official determination by the authority or the department to extend assistance under said sections, any municipality which is a distressed municipality as defined in subsection (b) of this section, and any other municipality in the state which in the calendar year preceding such determination had a rate of unemployment which exceeded one hundred ten per cent of the average rate of unemployment in the state for the same calendar year, as determined by the Labor Department, provided no such other municipality with an unemployment rate of less than six per cent shall be an area of high unemployment.

(b) "Distressed municipality" means, as of the date of the issuance of an eligibility certificate, any municipality in the state which, according to the United States Department of Housing and Urban Development meets the necessary number of quantitative physical and economic distress thresholds which are then applicable for eligibility for the urban development action grant program under the Housing and Community Development Act of 1977, as amended, or any town within which is located an unconsolidated city or borough which meets such distress thresholds. Any municipality which, at any time subsequent to July 1, 1978, has met such thresholds but which at any time thereafter fails to meet such thresholds, according to said department, shall be deemed to be a distressed municipality for a period of five years subsequent to the date of the determination that such municipality fails to meet such thresholds, unless such municipality elects to terminate its designation as a "distressed municipality", by vote of its legislative body, not later than September 1, 1985, or not later than three months after receiving notification from the commissioner that it no longer meets such thresholds, whichever is later. In the event a distressed municipality elects to terminate its designation, the municipality shall notify the commissioner and the Secretary of the Office of Policy and Management in writing within thirty days. In the event that the commissioner determines that amendatory federal legislation or administrative regulation has materially changed the distress thresholds thereby established, "distressed municipality" shall mean any municipality in the state which meets comparable thresholds of distress which are then applicable in the areas of high unemployment and poverty, aging housing stock and low or declining rates of growth in job creation, population and per capita income as established by the commissioner, consistent with the purposes of subdivisions (59) and (60) of section 12-81 AS AMENDED BY SECTION 11 OF THIS ACT and sections 12-217e, AS AMENDED BY SECTION 12 OF THIS ACT 32-9p to 32-9s, inclusive, AS AMENDED 32-23n and 32-23p, in regulations adopted in accordance with chapter 54. For purposes of sections 32-9p to 32-9s, inclusive, AS AMENDED "distressed municipality" shall also mean any municipality adversely impacted by a major plant closing, relocation or layoff, provided the eligibility of a municipality shall not exceed two years from the date of such closing, relocation or layoff. The Commissioner of Economic and Community Development shall adopt regulations, in accordance with the provisions of chapter 54, which define what constitutes a "major plant closing, relocation or layoff" for purposes of sections 32-9p to 32-9s, inclusive AS AMENDED. "Distressed municipality" shall also mean the portion of any municipality which is eligible for designation as an enterprise zone pursuant to subdivision (2) of subsection (b) of section 32-70.

(c) "Eligibility certificate" means a certificate issued by the department pursuant to section 32-9r AS AMENDED BY SECTION 13 OF THIS ACT evidencing its determination that a facility for which an application for assistance has been submitted qualifies as a manufacturing facility and is eligible for assistance under section 12-217e AS AMENDED BY SECTION 12 OF THIS ACT and subdivisions (59) and (60) of section 12-81 AS AMENDED BY SECTION 11 OF THIS ACT.

(d) "Manufacturing facility" means any plant, building, other real property improvement, or part thereof, (1) which (A) is constructed or substantially renovated or expanded on or after July 1, 1978, in a distressed municipality, a targeted investment community as defined in section 32-222, or an enterprise zone designated pursuant to section 32-70, AS AMENDED BY SECTION 2 OF THIS ACT or (B) is acquired on or after July 1, 1978, in a distressed municipality, a targeted investment community as defined in section 32-222, or an enterprise zone designated pursuant to said section 32-70, by a business organization which is unrelated to and unaffiliated with the seller, after having been idle for at least one year prior to its acquisition and regardless of its previous use; (2) which is to be used for the manufacturing, processing or assembling of raw materials, parts or manufactured products, for research and development facilities directly related to manufacturing, for the significant servicing, overhauling or rebuilding of machinery and equipment for industrial use, or, except as provided in this subsection, for the warehousing and distribution in bulk of manufactured products on other than a retail basis or, (i) if located in an enterprise zone designated pursuant to said section 32-70, which is to be used by an establishment, an auxiliary or an operating unit of an establishment as such terms are defined in the Standard Industrial Classification Manual, in the categories of depository institutions, nondepository credit institutions, insurance carriers, holding or other investment offices, business services, health services, fishing, hunting and trapping, motor freight transportation and warehousing, water transportation, transportation by air, transportation services, security and commodity brokers, dealers, exchanges and services TELEMARKETING or engineering, accounting, research, management and related services from the Standard Industrial Classification Manual, which establishment, auxiliary or operating unit shows a strong performance in exporting goods and services, as defined by the commissioner through regulations adopted under chapter 54 or (ii) if located in a municipality with an entertainment district designated under section 32-76 or established under section 2 of public act 93-311, is to be used in the production of entertainment products, including multimedia products, or as part of the airing, display or provision of live entertainment for stage or broadcast, including support services such as set manufacturers, scenery makers, sound and video equipment providers and manufacturers, stage and screen writers, providers of capital for the entertainment industry and agents for talent, writers, producers and music properties and technological infrastructure support including, but not limited to, fiber optics, necessary to support multimedia and other entertainment formats, except entertainment provided by or shown at a gambling or gaming facility or a facility whose primary business is the sale or serving of alcoholic beverages; and (3) for which the department has issued an eligibility certificate in accordance with section 32-9r AS AMENDED BY SECTION 13 OF THIS ACT. In the case of facilities which are acquired, the department may waive the requirement of one year of idleness if it determines that, absent qualification as a manufacturing facility under subdivisions (59) and (60) of section 12-81, AS AMENDED BY SECTION 11 OF THIS ACT and sections 12-217e, AS AMENDED BY SECTION 12 OF THIS ACT 32-9p to 32-9s, inclusive, AS AMENDED 32-23n and 32-23p, there is a high likelihood that the facility will remain idle for one year. In the case of facilities located in an enterprise zone designated pursuant to said section 32-70, (i) the idleness requirement in subparagraph (B) of subdivision (1), for business organizations which over the six months preceding such acquisition have had an average total employment of between six and nineteen employees, inclusive, shall be reduced to a minimum of six months, and (ii) the idleness requirement shall not apply to business organizations with an average total employment of five or fewer employees, provided no more than one eligibility certificate shall be issued under this subparagraph (ii) for the same facility within a three-year period. Of those facilities which are for the warehousing and distribution of manufactured products on other than a retail basis, only those which are newly constructed or which represent an expansion of an existing facility qualify as manufacturing facilities. In the event that only a portion of a plant is acquired, constructed, renovated or expanded, only the portion acquired, constructed, renovated or expanded constitutes the manufacturing facility. A manufacturing facility which is leased may for the purposes of subdivisions (59) and (60) of section 12-81 AS AMENDED BY SECTION 11 OF THIS ACT and sections 12-217e, AS AMENDED BY SECTION 12 OF THIS ACT 32-9p to 32-9s, inclusive, AS AMENDED 32-23n and 32-23p, be treated in the same manner as a facility which is acquired if the provisions of the lease serve to further the purposes of subdivisions (59) and (60) of section 12-81, AS AMENDED BY SECTION 11 OF THIS ACT and sections 12-217e, AS AMENDED BY SECTION 12 OF THIS ACT 32-9p to 32-9s, inclusive, AS AMENDED 32-23n and 32-23p and demonstrate a substantial, long-term commitment by the occupant to use the manufacturing facility, including a contract for lease for an initial minimum term of five years with provisions for the extension of the lease at the request of the lessee for an aggregate term which shall not be less than ten years, or the right of the lessee to purchase the facility at any time after the initial five-year term, or both. For a facility located in an enterprise zone designated pursuant to said section 32-70, and occupied by a business organization with an average total employment of ten or fewer employees over the six-month period preceding acquisition, such contract for lease may be for an initial minimum term of three years with provisions for the extension of the lease at the request of the lessee for an aggregate term which shall not be less than six years, or the right of the lessee to purchase the facility at any time after the initial three-year term, or both, and may also include the right for the lessee to relocate to other space within the same enterprise zone, provided such space is under the same ownership or control as the originally leased space or if such space is not under such same ownership or control as the originally leased space, permission to relocate is granted by the lessor of such originally leased space, and such relocation shall not extend the duration of benefits granted under the original eligibility certificate. Except as provided in subparagraph (B) above, a manufacturing facility does not include any plant, building, other real property improvement, or part thereof used or usable for such purposes which existed before July 1, 1978.

(e) "SERVICE FACILITY" MEANS A MANUFACTURING FACILITY DESCRIBED IN SUBPARAGRAPH (i) OF SUBDIVISION (2) OF SUBSECTION (d) OF THIS SECTION, PROVIDED SUCH FACILITY IS LOCATED OUTSIDE OF AN ENTERPRISE ZONE IN A TARGETED INVESTMENT COMMUNITY.

[(e)] (f) "Authority", "capital reserve fund bond", "commissioner", "department", "industrial project" and "insurance fund" shall have the meaning such words and terms are given in section 32-23d.

[(f)] (g) "Municipality" means any town, city or borough in the state.

Sec. 11. Subsections (59) and (60) of section 12-81 of the general statutes are repealed and the following is substituted in lieu thereof:

(59) (a) Any manufacturing facility, as defined in section 32-9p, AS AMENDED BY SECTION 10 OF THIS ACT acquired, constructed, substantially renovated or expanded on or after July 1, 1978, in a distressed municipality, as defined in said section or in a targeted investment community, as defined in section 32-222, or in an enterprise zone designated pursuant to section 32-70 AS AMENDED BY SECTION 2 OF THIS ACT and for which an eligibility certificate has been issued by the department, as follows: To the extent of eighty per cent of its valuation for purposes of assessment in each of the five full assessment years following the assessment year in which the acquisition, construction, renovation or expansion of the manufacturing facility is completed

(b) ANY SERVICE FACILITY, AS DEFINED IN SECTION 32-9p, AS AMENDED BY SECTION 10 OF THIS ACT, ACQUIRED, CONSTRUCTED, SUBSTANTIALLY RENOVATED OR EXPANDED ON OR AFTER THE EFFECTIVE DATE OF THIS ACT, AND FOR WHICH AN ELIGIBILITY CERTIFICATE HAS BEEN ISSUED BY THE DEPARTMENT, AS FOLLOWS: (i) IN THE CASE OF AN INVESTMENT OF TWENTY MILLION DOLLARS OR MORE BUT NOT MORE THAN THIRTY-NINE MILLION DOLLARS IN THE SERVICE FACILITY, TO THE EXTENT OF FORTY PER CENT OF ITS VALUATION FOR PURPOSES OF ASSESSMENT IN EACH OF THE FIVE FULL ASSESSMENT YEARS FOLLOWING THE ASSESSMENT YEAR IN WHICH THE ACQUISITION, CONSTRUCTION, RENOVATION OR EXPANSION OF THE SERVICE FACILITY IS COMPLETED; (ii) IN THE CASE OF AN INVESTMENT OF MORE THAN THIRTY-NINE MILLION DOLLARS BUT NOT MORE THAN FIFTY-NINE MILLION DOLLARS IN THE SERVICE FACILITY, TO THE EXTENT OF FIFTY PER CENT OF ITS VALUATION FOR PURPOSES OF ASSESSMENT IN EACH OF THE FIVE FULL ASSESSMENT YEARS FOLLOWING THE ASSESSMENT YEAR IN WHICH THE ACQUISITION, CONSTRUCTION, RENOVATION OR EXPANSION OF THE SERVICE FACILITY IS COMPLETED; (iii) IN THE CASE OF AN INVESTMENT OF MORE THAN FIFTY-NINE MILLION DOLLARS BUT NOT MORE THAN SEVENTY-NINE MILLION DOLLARS IN THE SERVICE FACILITY, TO THE EXTENT OF SIXTY PER CENT OF ITS VALUATION FOR PURPOSES OF ASSESSMENT IN EACH OF THE FIVE FULL ASSESSMENT YEARS FOLLOWING THE ASSESSMENT YEAR IN WHICH THE ACQUISITION, CONSTRUCTION, RENOVATION OR EXPANSION OF THE SERVICE FACILITY IS COMPLETED; (iv) IN THE CASE OF AN INVESTMENT OF MORE THAN SEVENTY-NINE MILLION DOLLARS BUT NOT MORE THAN NINETY MILLION DOLLARS IN THE SERVICE FACILITY, TO THE EXTENT OF SEVENTY PER CENT OF ITS VALUATION FOR PURPOSES OF ASSESSMENT IN EACH OF THE FIVE FULL ASSESSMENT YEARS FOLLOWING THE ASSESSMENT YEAR IN WHICH THE ACQUISITION, CONSTRUCTION, RENOVATION OR EXPANSION OF THE SERVICE FACILITY IS COMPLETED; OR (v) IN THE CASE OF AN INVESTMENT OF MORE THAN NINETY MILLION DOLLARS IN THE SERVICE FACILITY, TO THE EXTENT OF EIGHTY PER CENT OF ITS VALUATION FOR PURPOSES OF ASSESSMENT IN EACH OF THE FIVE FULL ASSESSMENT YEARS FOLLOWING THE ASSESSMENT YEAR IN WHICH THE ACQUISITION, CONSTRUCTION, RENOVATION OR EXPANSION OF THE SERVICE FACILITY IS COMPLETED

(c) The completion date OF A MANUFACTURING FACILITY OR A SERVICE FACILITY will be determined by the department taking into account the issuance of occupancy certificates and such other factors as it deems relevant. In the case of a manufacturing facility OR A SERVICE FACILITY which consists of a constructed, renovated or expanded portion of an existing plant, the assessed valuation of the [manufacturing] facility is the difference between the assessed valuation of the plant prior to its being improved and the assessed valuation of the plant upon completion of the improvements. In the case of a manufacturing facility OR A SERVICE FACILITY which consists of an acquired portion of an existing plant, the assessed valuation of the [manufacturing] facility is the assessed valuation of the portion acquired. This exemption shall be applicable during each such assessment year regardless of any change in the ownership or occupancy of the [manufacturing] facility. If during any such assessment year, however, any facility for which an eligibility certificate has been issued ceases to qualify as a manufacturing facility OR A SERVICE FACILITY, the entitlement to the exemption allowed by this subdivision shall terminate for the assessment year following the date on which the qualification ceases, and there shall not be a pro rata application of the exemption. Any person who desires to claim the exemption provided in this subdivision shall file annually with the assessor or board of assessors in the distressed municipality, targeted investment community or enterprise zone designated pursuant to section 32-70 AS AMENDED BY SECTION 2 OF THIS ACT in which the manufacturing facility OR SERVICE FACILITY is located, on or before the first day of November, written application claiming such exemption on a form prescribed by the Secretary of the Office of Policy and Management. Failure to file such application in this manner and form within the time limit prescribed shall constitute a waiver of the right to such exemption for such assessment year, unless an extension of time is allowed by the Secretary of the Office of Policy and Management as set forth in section 12-81k, and upon payment of the required fee for late filing;

(60) (a) (1) Machinery and equipment which represents an addition to the assessment or grand list of the municipality in which this exemption is claimed and is installed in any manufacturing facility, as defined in section 32-9p, AS AMENDED BY SECTION 10 OF THIS ACT which facility is or has been constructed, or substantially renovated or expanded on or after July 1, 1978, in a distressed municipality or targeted investment community or enterprise zone designated pursuant to section 32-70 AS AMENDED BY SECTION 2 OF THIS ACT and for which an eligibility certificate has been issued by the department, concurrently with and directly attributable to such construction, renovation or expansion, (2) machinery and equipment which represents an addition to the assessment or grand list of the municipality in which this exemption is claimed and is installed, or machinery and equipment existing, in any manufacturing facility, as defined in section 32-9p, AS AMENDED BY SECTION 10 OF THIS ACT which facility is or has been acquired on or after July 1, 1978, in a distressed municipality, targeted investment community or enterprise zone designated pursuant to section 32-70 AS AMENDED BY SECTION 2 OF THIS ACT and for which an eligibility certificate has been issued by the department, and (3) machinery and equipment acquired and installed on or after October 1, 1986, in a manufacturing facility that is or has at one time been certified as eligible for the exemption under this [section] SUBPARAGRAPH in accordance with section 32-9r, AS AMENDED BY SECTION 13 OF THIS ACT and which continues to be used for manufacturing purposes, provided such machinery and equipment is installed in conjunction with an expansion program that satisfies the requirements for a manufacturing facility, as defined in section 32-9p, AS AMENDED BY SECTION 10 OF THIS ACT and is contiguous to and represents an increase in square feet of floor space of not less than fifty per cent of the floor space in the certified manufacturing facility, as follows: To the extent of eighty per cent of its valuation for purposes of assessment in each of the five full assessment years for which the manufacturing facility in which it is installed qualifies for an exemption under subdivision (59) of this section

(b) (1) MACHINERY AND EQUIPMENT WHICH REPRESENTS AN ADDITION TO THE ASSESSMENT OR GRAND LIST OF THE MUNICIPALITY IN WHICH THIS EXEMPTION IS CLAIMED AND IS INSTALLED IN ANY SERVICE FACILITY, AS DEFINED IN SECTION 32-9p, AS AMENDED BY SECTION 10 OF THIS ACT, WHICH FACILITY IS OR HAS BEEN CONSTRUCTED, OR SUBSTANTIALLY RENOVATED OR EXPANDED ON OR AFTER THE EFFECTIVE DATE OF THIS ACT, AND FOR WHICH AN ELIGIBILITY CERTIFICATE HAS BEEN ISSUED BY THE DEPARTMENT, CONCURRENTLY WITH AND DIRECTLY ATTRIBUTABLE TO SUCH CONSTRUCTION, RENOVATION OR EXPANSION, (2) MACHINERY AND EQUIPMENT WHICH REPRESENTS AN ADDITION TO THE ASSESSMENT OR GRAND LIST OF THE MUNICIPALITY IN WHICH THIS EXEMPTION IS CLAIMED AND IS INSTALLED, OR MACHINERY AND EQUIPMENT EXISTING, IN ANY SERVICE FACILITY, AS DEFINED IN SECTION 32-9p, AS AMENDED BY SECTION 10 OF THIS ACT, WHICH FACILITY IS OR HAS BEEN ACQUIRED ON OR AFTER THE EFFECTIVE DATE OF THIS ACT, AND FOR WHICH AN ELIGIBILITY CERTIFICATE HAS BEEN ISSUED BY THE DEPARTMENT, AND (3) MACHINERY AND EQUIPMENT ACQUIRED AND INSTALLED ON OR AFTER THE EFFECTIVE DATE OF THIS ACT IN A SERVICE FACILITY THAT IS OR HAS AT ONE TIME BEEN CERTIFIED AS ELIGIBLE FOR THE EXEMPTION UNDER THIS SUBPARAGRAPH IN ACCORDANCE WITH SECTION 32-9r, AS AMENDED BY SECTION 13 OF THIS ACT, AND WHICH CONTINUES TO BE USED FOR SERVICE PURPOSES, PROVIDED SUCH MACHINERY AND EQUIPMENT IS INSTALLED IN CONJUNCTION WITH AN EXPANSION PROGRAM THAT SATISFIES THE REQUIREMENTS FOR A SERVICE FACILITY, AS DEFINED IN SECTION 32-9p, AS AMENDED BY SECTION 10 OF THIS ACT, AND IS CONTIGUOUS TO AND REPRESENTS AN INCREASE IN SQUARE FEET OF FLOOR SPACE OF NOT LESS THAN FIFTY PER CENT OF THE FLOOR SPACE IN THE CERTIFIED SERVICE FACILITY, AS FOLLOWS: (i) IN THE CASE OF AN INVESTMENT OF TWENTY MILLION DOLLARS OR MORE BUT NOT MORE THAN THIRTY-NINE MILLION DOLLARS IN THE SERVICE FACILITY, TO THE EXTENT OF FORTY PER CENT OF ITS VALUATION FOR PURPOSES OF ASSESSMENT IN EACH OF THE FIVE FULL ASSESSMENT YEARS FOR WHICH THE SERVICE FACILITY IN WHICH IT IS INSTALLED QUALIFIES FOR AN EXEMPTION UNDER SUBDIVISION (59) OF THIS SECTION; (ii) IN THE CASE OF AN INVESTMENT OF MORE THAN THIRTY-NINE MILLION DOLLARS BUT NOT MORE THAN FIFTY-NINE MILLION DOLLARS IN THE SERVICE FACILITY, TO THE EXTENT OF FIFTY PER CENT OF ITS VALUATION FOR PURPOSES OF ASSESSMENT IN EACH OF THE FIVE FULL ASSESSMENT YEARS FOR WHICH THE SERVICE FACILITY IN WHICH IT IS INSTALLED QUALIFIES FOR AN EXEMPTION UNDER SUBDIVISION (59) OF THIS SECTION; (iii) IN THE CASE OF AN INVESTMENT OF MORE THAN FIFTY-NINE MILLION DOLLARS BUT NOT MORE THAN SEVENTY-NINE MILLION DOLLARS IN THE SERVICE FACILITY, TO THE EXTENT OF SIXTY PER CENT OF ITS VALUATION FOR PURPOSES OF ASSESSMENT IN EACH OF THE FIVE FULL ASSESSMENT YEARS FOR WHICH THE SERVICE FACILITY IN WHICH IT IS INSTALLED QUALIFIES FOR AN EXEMPTION UNDER SUBDIVISION (59) OF THIS SECTION; (iv) IN THE CASE OF AN INVESTMENT OF MORE THAN SEVENTY-NINE MILLION DOLLARS BUT NOT MORE THAN NINETY MILLION DOLLARS IN THE SERVICE FACILITY, TO THE EXTENT OF SEVENTY PER CENT OF ITS VALUATION FOR PURPOSES OF ASSESSMENT IN EACH OF THE FIVE FULL ASSESSMENT YEARS FOR WHICH THE SERVICE FACILITY IN WHICH IT IS INSTALLED QUALIFIES FOR AN EXEMPTION UNDER SUBDIVISION (59) OF THIS SECTION; OR (v) IN THE CASE OF AN INVESTMENT OF MORE THAN NINETY MILLION DOLLARS IN THE SERVICE FACILITY, TO THE EXTENT OF EIGHTY PER CENT OF ITS VALUATION FOR PURPOSES OF ASSESSMENT IN EACH OF THE FIVE FULL ASSESSMENT YEARS FOR WHICH THE SERVICE FACILITY IN WHICH IT IS INSTALLED QUALIFIES FOR AN EXEMPTION UNDER SUBDIVISION (59) OF THIS SECTION

(c) This exemption shall terminate for the assessment year next following if the manufacturing facility OR SERVICE FACILITY in which such machinery and equipment is installed no longer qualifies for an exemption under said subdivision (59), and there shall not be a pro rata application of the exemption of such machinery and equipment in the assessment year of such termination. Any person who desires to claim the exemption provided in this subdivision shall file annually with the assessor or board of assessors in the distressed municipality, targeted investment community or enterprise zone designated pursuant to section 32-70 AS AMENDED BY SECTION 2 OF THIS ACT in which the manufacturing facility OR SERVICE FACILITY is located, on or before the first day of November, written application claiming such exemption on a form prescribed by the Secretary of the Office of Policy and Management. Failure to file such application in this manner and form within the time limit prescribed shall constitute a waiver of the right to such exemption for such assessment year, unless an extension of time is allowed by the Secretary of the Office of Policy and Management as set forth in section 12-81k, and upon payment of the required fee for late filing.

Sec. 12. Section 12-217e of the general statutes is repealed and the following is substituted in lieu thereof:

(a) There shall be allowed as a credit against the tax imposed by this chapter an amount equal to twenty-five per cent of that portion of such tax which is allocable to any manufacturing facility, provided, for any such facility which is located in an enterprise zone designated pursuant to section 32-70 or in a municipality with an entertainment district designated under section 32-76 or established under section 2 of public act 93-311 and which became eligible as a manufacturing facility after the designation of such zone and for which not less than one hundred fifty full-time employees or thirty per cent of the full-time employment positions directly attributable to the manufacturing facility were, during the last quarter of the income year of the taxpayer, held by employees of the taxpayer who at the time of employment were (1) residents of such zone, or (2) residents of such municipality and eligible for training under the Federal Comprehensive Employment Training Act or any other training program that may replace the Comprehensive Employment Training Act, a credit of fifty per cent shall be allowed. A position is directly attributable to the manufacturing facility if: (A) The work is performed or the base of operations is at the facility; (B) the position did not exist prior to the construction, renovation, expansion or acquisition of the facility; and (C) but for the construction, renovation, expansion or acquisition of the facility, the position would not have existed.

(b) THERE SHALL BE ALLOWED AS A CREDIT AGAINST THE TAX IMPOSED BY THIS CHAPTER AN AMOUNT EQUAL TO THE FOLLOWING PERCENTAGE OF THAT PORTION OF SUCH TAX WHICH IS ALLOCABLE TO ANY SERVICE FACILITY: (1) FIFTEEN PER CENT, IF THERE ARE THREE HUNDRED OR MORE BUT NOT MORE THAN FIVE HUNDRED NINETY-NINE NEW EMPLOYEES WORKING AT SUCH FACILITY; (2) TWENTY PER CENT IF THERE ARE SIX HUNDRED OR MORE BUT NOT MORE THAN EIGHT HUNDRED NINETY-NINE NEW EMPLOYEES WORKING AT SUCH FACILITY; (3) TWENTY-FIVE PER CENT, IF THERE ARE NINE HUNDRED OR MORE BUT NOT MORE THAN ONE THOUSAND ONE HUNDRED NINETY-NINE NEW EMPLOYEES WORKING AT SUCH FACILITY; (4) THIRTY PER CENT IF THERE ARE ONE THOUSAND TWO HUNDRED OR MORE BUT NOT MORE THAN ONE THOUSAND FOUR HUNDRED NINETY-NINE NEW EMPLOYEES WORKING AT SUCH FACILITY; (5) FORTY PER CENT, IF THERE ARE ONE THOUSAND FIVE HUNDRED OR MORE BUT NOT MORE THAN ONE THOUSAND NINE HUNDRED NINETY-NINE NEW EMPLOYEES WORKING AT SUCH FACILITY; OR (6) FIFTY PER CENT IF THERE ARE TWO THOUSAND OR MORE NEW EMPLOYEES WORKING AT SUCH FACILITY. AS USED IN THIS SUBSECTION: (A) "NEW EMPLOYEE" MEANS A PERSON HIRED BY A TAXPAYER TO FILL A POSITION FOR A NEW JOB OR A PERSON SHIFTED FROM AN EXISTING LOCATION OF THE TAXPAYER OUTSIDE THIS STATE TO A SERVICE FACILITY IN THIS STATE, PROVIDED (i) IN NO CASE SHALL THE TOTAL NUMBER OF NEW EMPLOYEES ALLOWED FOR PURPOSES OF THIS CREDIT EXCEED THE TOTAL INCREASE IN THE TAXPAYER'S EMPLOYMENT IN THIS STATE, WHICH INCREASE SHALL BE THE DIFFERENCE BETWEEN (I) THE NUMBER OF EMPLOYEES EMPLOYED BY THE TAXPAYER IN THIS STATE AT THE TIME OF APPLICATION TO THE COMMISSIONER OF REVENUE SERVICES FOR SUCH CREDIT PLUS THE NUMBER OF NEW EMPLOYEES WHO WOULD BE ELIGIBLE FOR INCLUSION UNDER THE CREDIT ALLOWED UNDER THIS SUBSECTION WITHOUT REGARD TO THIS CALCULATION, AND (II) THE HIGHEST NUMBER OF EMPLOYEES EMPLOYED BY THE TAXPAYER IN THIS STATE IN THE YEAR PRECEDING THE TAXPAYER'S APPLICATION TO THE COMMISSIONER OF REVENUE SERVICES FOR SUCH CREDIT, AND (ii) A PERSON SHALL BE DEEMED TO BE A "NEW EMPLOYEE" ONLY IF SUCH PERSON'S DUTIES IN CONNECTION WITH THE OPERATION OF THE FACILITY ARE ON A REGULAR, FULL-TIME OR EQUIVALENT OR FULL-TIME AND PERMANENT BASIS; AND (B) "NEW JOB" MEANS A JOB THAT DID NOT EXIST IN THE BUSINESS OF A TAXPAYER IN THIS STATE PRIOR TO THE TAXPAYER'S APPLICATION TO THE COMMISSIONER OF REVENUE SERVICES FOR SUCH CREDIT AND THAT IS FILLED BY A NEW EMPLOYEE, BUT DOES NOT INCLUDE A JOB CREATED WHEN AN EMPLOYEE IS SHIFTED FROM AN EXISTING LOCATION OF THE TAXPAYER IN THIS STATE TO A SERVICE FACILITY.

[(b)] (c) The portion of such tax which is allocable to such a manufacturing facility OR SERVICE FACILITY shall be determined by multiplying such tax by a fraction computed as the simple arithmetical mean of the following fractions: First, a fraction the numerator of which is the average monthly net book value in the income year of the manufacturing facility OR SERVICE FACILITY and machinery and equipment acquired for and installed in the manufacturing facility OR SERVICE FACILITY, without deduction on account of any encumbrance thereon, or if rented to the taxpayer, the value of the manufacturing facility OR SERVICE FACILITY and machinery and equipment acquired for and installed in the manufacturing facility OR SERVICE FACILITY, computed by multiplying the gross rents payable by the taxpayer for the manufacturing facility OR SERVICE FACILITY and such machinery and equipment during the income year or period by eight, and the denominator of which is the sum of the average monthly net book value of all real property and machinery and equipment held and owned by the taxpayer in the state, without deduction on account of any encumbrance thereon and the value of all real property and machinery and equipment rented to the taxpayer in the state, computed by multiplying the gross rents payable during the income year by eight; and second, a fraction the numerator of which is all wages, salaries and other compensation paid during the income year to employees of the taxpayer whose positions are directly attributable to the manufacturing facility OR SERVICE FACILITY and the denominator of which is the wages, salaries and other compensation paid during the income year to all employees of the taxpayer in the state. An employee's position is directly so attributable if (1) the employee's service is performed or his base of operations is at the manufacturing facility OR SERVICE FACILITY, (2) the position did not exist prior to the construction, renovation, expansion or acquisition of the manufacturing facility OR SERVICE FACILITY, and (3) but for the construction, renovation, expansion or acquisition of the manufacturing facility OR SERVICE FACILITY the position would not have existed. For the purposes of this subsection, "gross rents" means gross rents as defined in section 12-218.

[(c)] (d) The credit allowed by this section may be claimed only by the initial occupant or occupants of the manufacturing facility OR SERVICE FACILITY. The owner of the manufacturing facility OR SERVICE FACILITY may not claim the credit unless the owner is also an occupant. The credit may not be claimed before the first full income year following the issuance of an eligibility certificate, but may be claimed in such income year and in each of the following nine income years. If within such period, however, any facility for which an eligibility certificate has been issued ceases to qualify as a manufacturing facility OR SERVICE FACILITY or any occupant of a manufacturing facility OR SERVICE FACILITY ceases to be an occupant, the entitlement to the credit allowed by this section shall terminate in the income year in which the qualification or occupancy ceases, and there shall not be a pro rata application of the credit to such income year.

[(d)] (e) Any subsequent occupant or occupants of a manufacturing facility OR SERVICE FACILITY for which an eligibility certificate has been issued may claim the credit allowed by this section in accordance with subsection (c) of this section but only after obtaining a new eligibility certificate with respect to the manufacturing facility OR SERVICE FACILITY being occupied in the manner provided in section 32-9r AS AMENDED BY SECTION 13 OF THIS ACT.

[(e)] (f) Any taxpayer claiming the credit allowed by this section shall submit to the Commissioner of Revenue Services a copy of the applicable eligibility certificate with his tax return in each income year for which a deduction is claimed.

Sec. 13. Section 32-9r of the general statutes, as amended by section 11 of public act 95-334, is repealed and the following is substituted in lieu thereof:

(a) Any person may apply to the department for a determination as to whether the facility described in an application qualifies as a manufacturing facility OR SERVICE FACILITY. Applications for eligibility certificates are to be made on the forms and in the manner prescribed by the department. In evaluating each application the department may require the submission of all books, records, documents, drawings, specifications, certifications and other evidentiary items which it deems appropriate. No eligibility certificate shall be issued after March 1, 1991, for a manufacturing facility located in a distressed municipality which does not qualify as a targeted investment community unless the department has issued to the applicant a commitment letter for such facility prior to March 1, 1991. Notwithstanding the provisions of this subsection, an eligibility certificate may be issued by the department after March 1, 1991, for a qualified manufacturing facility acquired, constructed or substantially renovated in a distressed municipality provided the commissioner determines that such acquisition, construction or substantial renovation was initiated prior to March 1, 1991, and was legitimately induced by the prospect of assistance under section 12-217e AS AMENDED BY SECTION 12 OF THIS ACT and subdivisions (59) and (60) of section 12-81, AS AMENDED BY SECTION 11 OF THIS ACT respectively. The department may issue an eligibility certificate for a qualified manufacturing facility OR A QUALIFIED SERVICE FACILITY located in a targeted investment community upon determination by the commissioner (A) that the acquisition, construction or substantial renovation relating to the qualified manufacturing facility OR QUALIFIED SERVICE FACILITY in such community was induced by the prospect of assistance under section 12-217e AS AMENDED BY SECTION 12 OF THIS ACT and subdivisions (59) and (60) of said section 12-81; and (B) the applicant demonstrates an economic need or there is an economic benefit to the state. The department shall issue an eligibility certificate if the commissioner determines (1) that the MANUFACTURING facility is located in an enterprise zone designated pursuant to section 32-70 AS AMENDED BY SECTION 2 OF THIS ACT and is a qualified manufacturing facility or (2) that the facility is a plant, building, other real property improvement, or part thereof, which is located in a municipality with an entertainment district designated under section 32-76 or established under section 2 of public act 93-311, and which qualifies as a "manufacturing facility" under subsection (d) of section 32-9p AS AMENDED BY SECTION 10 OF THIS ACT in that it is to be used in the production of entertainment products, including multimedia products, or as part of the airing, display or provision of live entertainment for stage or broadcast, including support services such as set manufacturers, scenery makers, sound and video equipment providers and manufacturers, stage and screen writers, providers of capital for the entertainment industry and agents for talent, writers, producers and music properties and technological infrastructure support including, but not limited to, fiber optics, necessary to support multimedia and other entertainment formats, except entertainment provided by or shown at a gambling or gaming facility or a facility whose primary business is the sale or serving of alcoholic beverages.

(b) The department shall reach a determination as to the eligibility of a facility within a reasonable time period, but may postpone the determination to the extent required to verify to its satisfaction that there is a high likelihood that any proposed facility will actually be constructed, expanded, substantially renovated or acquired. Upon a favorable finding, the department shall issue to the applicant a certificate to the effect that the facility concerned is a manufacturing facility OR A SERVICE FACILITY and is eligible for assistance under section 12-217e AS AMENDED BY SECTION 12 OF THIS ACT and subdivisions (59) and (60) of section 12-81 AS AMENDED BY SECTION 11 OF THIS ACT.

(c) Upon an unfavorable determination the department shall issue a notice to the applicant to the effect that the facility concerned has been determined not to be a manufacturing facility OR A SERVICE FACILITY, together with a statement in reasonable detail as to the reasons for the unfavorable determination. Any aggrieved applicant shall be afforded an opportunity for a public hearing on the matter within thirty days following issuance of the notice. The department shall reconsider the application based upon the information presented at the public hearing and reaffirm or change its earlier determination within ten days of the hearing.

(d) The decision of the department to issue an eligibility certificate or to deny an application for the issuance of an eligibility certificate either upon the expiration of thirty days without a public hearing following an initial unfavorable determination or upon any reconsideration of the application pursuant to subsection (c) of this section is conclusive and final as to the matters thereby decided, and chapter 54 shall not apply to the administrative determinations authorized to be made by this section.

(e) Any person who claims a benefit under section 12-217e AS AMENDED BY SECTION 12 OF THIS ACT or subdivisions (59) and (60) of section 12-81 AS AMENDED BY SECTION 11 OF THIS ACT shall notify the department of any change in fact or circumstance which may bear upon the continued qualification as a manufacturing facility OR A SERVICE FACILITY for which an eligibility certificate has been issued. Upon receipt of such information or upon independent investigation, the department may revoke the eligibility certificate in the manner provided in subsection (c) of this section.

(f) The commissioner shall adopt regulations in accordance with chapter 54 to carry out the provisions of this section. Such regulations shall provide that establishments in the category of business services, as defined in the Standard Industrial Classification Manual, shall be eligible for a certificate if they are located in an enterprise zone.

Sec. 14. Section 32-9s of the general statutes is repealed and the following is substituted in lieu thereof:

The state shall make an annual grant payment to each municipality, to each district, as defined in section 7-325, which is located in a distressed municipality, targeted investment community or enterprise zone and to each special services district created pursuant to chapter 105a which is located in a distressed municipality, targeted investment community or enterprise zone (1) in the amount of fifty per cent of the amount of that tax revenue which the municipality or district would have received except for the provisions of subdivisions (59) and (60) of section 12-81, AS AMENDED BY SECTION 11 OF THIS ACT except as provided in subdivision (3) of this section, (2) in the amount of fifty per cent of the amount of the tax revenue which the municipality or district would have received except for the provisions of subdivision (70) of section 12-81, and (3) in the case of a certified manufacturing facility located in an enterprise zone designated pursuant to section 32-70 and used by an establishment, an auxiliary or an operating unit of an establishment as such terms are defined in the Standard Industrial Classification Manual in the categories of depository institutions, nondepository credit institutions, insurance carriers, holding or other investment offices, business services, health services, fishing, hunting and trapping, motor freight transportation and warehousing, water transportation, transportation by air, transportation services, security and commodity brokers, dealers, exchanges and services TELEMARKETING or engineering, accounting, research, management and related services from the Standard Industrial Classification Manual, which establishment, auxiliary or operating unit shows a strong performance in exporting goods and services, as defined by the commissioner through regulations adopted in accordance with the provisions of chapter 54, in the amount of fifty per cent of the amount of tax revenue which the municipality or district would have received from such facility except for the provisions of subdivisions (59) and (60) of section 12-81 AS AMENDED BY SECTION 11 OF THIS ACT. On or before the first day of August of each year, each municipality and district shall file a claim with the Secretary of the Office of Policy and Management for the amount of such grant payment to which such municipality or district is entitled under this section. The claim shall be made on forms prescribed by the Secretary of the Office of Policy and Management and shall be accompanied by such supporting information as the Secretary of the Office of Policy and Management may require. Any municipality or district which neglects to transmit to the Secretary of the Office of Policy and Management such claim and supporting documentation as required by this section shall forfeit two hundred fifty dollars to the state, provided the secretary may waive such forfeiture in accordance with procedures and standards adopted by regulation in accordance with chapter 54. The Secretary of the Office of Policy and Management shall notify each municipality or district which has made such a claim of his acceptance or modification of the claim not later than the August first next succeeding the deadline for the receipt of such claims. Any municipality or district aggrieved by the action of the Secretary of the Office of Policy and Management under the provisions of this section may appeal, within one month of receipt of any notice made pursuant to this section, to the superior court for the judicial district in which such municipality or district is located. The secretary of the office of policy and management shall, on or before the December first next succeeding the deadline for the receipt of such claims, certify to the Comptroller the amount due under this section, including any modification of such claim made prior to December first, to each municipality or district which has made a claim under the provisions of this section. The Comptroller shall draw his order on the Treasurer on or before the following December fifteenth, and the Treasurer shall pay the amount thereof to each such municipality or district on or before the following December thirty-first. If any modification is made as the result of the provisions of this section on or after the December first following the date on which the municipality or district has provided the amount of tax revenue in question, any adjustment to the amount due to any municipality or district for the period for which such modification was made shall be made in the next payment the Treasurer shall make to such municipality or district pursuant to this section.

Sec. 15. Section 32-9s of the general statutes, as amended by section 21 of public act 95-283, is repealed and the following is substituted in lieu thereof:

The state shall make an annual grant payment to each municipality, to each district, as defined in section 7-325, which is located in a distressed municipality, targeted investment community or enterprise zone and to each special services district created pursuant to chapter 105a which is located in a distressed municipality, targeted investment community or enterprise zone (1) in the amount of fifty per cent of the amount of that tax revenue which the municipality or district would have received except for the provisions of subdivisions (59) and (60) of section 12-81, AS AMENDED BY SECTION 11 OF THIS ACT except as provided in subdivision (3) of this section, (2) in the amount of fifty per cent of the amount of the tax revenue which the municipality or district would have received except for the provisions of subdivision (70) of section 12-81, and (3) in the case of a certified manufacturing facility located in an enterprise zone designated pursuant to section 32-70AS AMENDED BY SECTION 2 OF THIS ACT and used by an establishment, an auxiliary or an operating unit of an establishment as such terms are defined in the Standard Industrial Classification Manual in the categories of depository institutions, nondepository credit institutions, insurance carriers, holding or other investment offices, business services, health services, fishing, hunting and trapping, motor freight transportation and warehousing, water transportation, transportation by air, transportation services, security and commodity brokers, dealers, exchanges and services TELEMARKETING or engineering, accounting, research, management and related services from the Standard Industrial Classification Manual, which establishment, auxiliary or operating unit shows a strong performance in exporting goods and services, as defined by the commissioner through regulations adopted in accordance with the provisions of chapter 54, in the amount of fifty per cent of the amount of tax revenue which the municipality or district would have received from such facility except for the provisions of subdivisions (59) and (60) of section 12-81 AS AMENDED BY SECTION 11 OF THIS ACT. On or before the first day of August of each year, each municipality and district shall file a claim with the Secretary of the Office of Policy and Management for the amount of such grant payment to which such municipality or district is entitled under this section. The claim shall be made on forms prescribed by the Secretary of the Office of Policy and Management and shall be accompanied by such supporting information as the Secretary of the Office of Policy and Management may require. Any municipality or district which neglects to transmit to the Secretary of the Office of Policy and Management such claim and supporting documentation as required by this section shall forfeit two hundred fifty dollars to the state, provided the secretary may waive such forfeiture in accordance with procedures and standards adopted by regulation in accordance with chapter 54. The Secretary of the Office of Policy and Management shall notify each municipality or district which has made such a claim of his acceptance or modification of the claim not later than the August first next succeeding the deadline for the receipt of such claims. Any municipality or district aggrieved by the action of the Secretary of the Office of Policy and Management under the provisions of this section may appeal, within one month of receipt of any notice made pursuant to this section, to the superior court for the judicial district of Hartford-New Britain pursuant to section 12-39l. The Secretary of the Office of Policy and Management shall, on or before the December first next succeeding the deadline for the receipt of such claims, certify to the Comptroller the amount due under this section, including any modification of such claim made prior to December first, to each municipality or district which has made a claim under the provisions of this section. The Comptroller shall draw his order on the Treasurer on or before the following December fifteenth, and the Treasurer shall pay the amount thereof to each such municipality or district on or before the following December thirty-first. If any modification is made as the result of the provisions of this section on or after the December first following the date on which the municipality or district has provided the amount of tax revenue in question, any adjustment to the amount due to any municipality or district for the period for which such modification was made shall be made in the next payment the Treasurer shall make to such municipality or district pursuant to this section.

Sec. 16. During the fiscal year ending June 30, 1997, the Commissioner of Economic and Community Development shall conduct a marketing campaign to promote the enterprise corridor zones established under section 32-80 of the general statutes, as amended by section 1 of this act.

Sec. 17. This act shall take effect July 1, 1996, except that section 15 shall take effect October 1, 1996.

Approved June 7, 1996. Effective as provided in section 17.

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