Section 15-6-9 - State criteria used to determine business qualification(a) To qualify for enterprise zone benefits, a qualified business authorized to do business in the State shall satisfy the following requirements: (1) Be subject to chapter 235, HRS(2) Be engaged in an eligible business activity, as defined in section [] 209E-2, HRS; and(3) [] Meet the requirements under either [] subsection (c) or (d).(b) Where the department finds that a business becomes eligible to participate under the program during a business' taxable year, rather than at the start of the taxable year, the requirement that at least fifty per cent of the business' enterprise zone [] establishments' gross receipts be attributable to the active conduct of a trade or business within enterprise zones located within the same county, and the requirement that the business increase its average annual number of full-time employees by at least ten per cent by the end of its first tax year of participation, and the requirement that a business increase its gross sales of agricultural crops or agricultural products by two per cent annually, shall be determined by the actual number of months that it does business within enterprise zones located within the same county during the taxable year.(c) [] A business which begins operation of a trade or business in an eligible business activity within a zone after the date of zone designation shall meet the following requirements:(1) During each taxable year, at least fifty per cent of the business' enterprise zone [] establishments' gross receipts are attributable to the active conduct of a trade or business [] within enterprise zones located within the same county; and(2) Increases its average annual number of fulltime employees employed at the business' establishment or establishments within enterprise zones located within the same county by at least ten per cent by the end of its first tax year of participation, and during each subsequent taxable year at least maintains that higher level of employment; or(3) Increases its gross sales of agricultural crops produced, or agricultural products processed within enterprise zones located within the same county by two per cent annually.(4) If the calculation used to determine compliance with paragraph (2) results in a fractional percentage, the result should be rounded up or down to the next whole percentage.(d) A business which is actively engaged in the conduct of a trade or business in an eligible business activity in a zone prior to the time of zone designation shall meet the following requirements: (1) During each taxable year, at least fifty per cent of the business' enterprise zone establishments' gross receipts are attributable to the active conduct of a trade or business within enterprise zones located within the same county; and Either:(i) Increases its average annual number of full-time employees employed at the business' establishment or establishments within enterprise zones located within the same county by at least ten per cent by the end of the first year of operation, and by at least fifteen per cent by the end of each of the fourth, fifth, sixth, and seventh years of operation, and for businesses eligible for tax credits extending past the seventh year, at least maintains that higher level of employment during each subsequent taxable year; or(ii) Increases its gross sales of agricultural crops produced, or agricultural products processed within enterprise zones located within the same county by two per cent annually.(3) The percentage increase in paragraph (2) shall be based on the employee count at the beginning of the initial year of operation within the enterprise zone or zones.(4) If the calculations used to determine compliance with paragraph (2) results in a fractional percentage, the result should be rounded up or down to the next whole percentage.(e) Even after the certification of a business at the end of the initial year of qualification, a business must meet the requirements of this section in each year remaining in its qualification period to receive certification for the tax credits or the exemption from the general excise tax for that year. [Eff 11/3/90; am and comp2/28/2015] (Auth: HRS § 209E-8) (Imp: HRS § 209E-9)