MEGA: HIGH TECH. BUSINESS H.B. 6034: FLOOR ANALYSIS
House Bill 6034 (as reported without amendment)
Sponsor: Representative Bill Huizenga
House Committee: Commerce
Senate Committee: Commerce and Labor
CONTENT
The bill would amend the Michigan Economic Growth Authority (MEGA) Act to include a "facility", in addition to a "business", in the Act's definition of "qualified high-technology business".
The Act allows MEGA to enter into agreements providing single business tax (SBT) credits to firms that create and maintain jobs in the State. These include a qualified high-technology business that meets certain job creation and retention and wage criteria. "Qualified high-technology business" means a business with at least 25% of its total operating expenses used for research and development or whose primary business activity is high-technology activity. Under the bill, the term would mean a business or facility that was either 1) a business meeting the research and development criterion, or 2) a business or facility whose primary business activity was high-technology activity.
The Act defines "facility" as a site or sites within Michigan in which an authorized business or subsidiary businesses maintain retained jobs or create qualified new jobs. "Business" means a proprietorship, joint venture, partnership, limited liability partnership, trust, business trust, syndicate, association, joint stock company, corporation, cooperative, limited liability company, or any other organization.
"High-technology activity" means advanced computing; advanced materials; biotechnology, other than human cloning or stem cell research with embryonic tissue; electronic device technology; engineering or laboratory testing related to the development of a product; technology that assists in the assessment or prevention of threats or damage to human health or the environment; medical device technology; product research and development; advanced vehicle technology; or tool and die manufacturing.
MCL 207.803 Legislative Analyst: Patrick Affholter
FISCAL IMPACT
While the bill would likely expand the number of businesses that would be eligible for high-technology MEGA tax credits, the number of credits that could be granted each year would not change from the current maximum of 50. Therefore, the bill would potentially change the mix of businesses that are granted MEGA tax credits, but it is not possible to make a reasonable estimate of the bill's fiscal impact at this time because there is no way to know how the proposed changes would affect the dollar value of the tax credits that would be granted to eligible businesses compared with the total dollar value of the tax credits under current law.
Date Completed: 5-31-06 Fiscal Analyst: Jay Wortley
Analysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations and does not constitute an official statement of legislative intent. hb6034/0506