R.I. Gen. Laws § 42-64.5-2

Current through 2024 Public Law 457

Section 42-64.5-2 - Definitions

As used in this chapter, unless the context clearly indicates otherwise:

(1) "Adjusted current employment" means, for any taxable year ending on or after July 1, 1995, the aggregate of the average daily number of full-time equivalent active employees employed within the State by an eligible company and its eligible subsidiaries during each taxable year.

(2) "Affiliated entity" means any corporation owned or controlled by the same persons or shareholders who own or control an eligible company.

(3) "Base employment" means, except as otherwise provided in § 42-64.5-7, the aggregate number of full-time equivalent active employees employed within the State by an eligible company and its eligible subsidiaries on July 1, 1994, or at the election of the eligible company, on an alternative date as provided by § 42-64.5-5. In the case of a manufacturing company which is ruined by disaster, the aggregate number of full-time equivalent active employees employed at the destroyed facility would be zero, under which circumstance the base employment date shall be July 1 of the calendar year in which the disaster occurred. Only one base employment period can be elected for purposes of a rate reduction by an eligible company.

(4) "Disaster" means an occurrence, natural or otherwise, which results in the destruction of sixty percent (60%) or more of an operating manufacturing business facility in this state, thereby making the production of products by the eligible company impossible and as a result active employees of the facility are without employment in that facility. However, disaster does not include any damage resulting from the willful act of the owner(s) of the manufacturing business facility.

(5) "Eligible company" means any corporation, state bank, federal savings bank, trust company, national banking association, bank holding company, loan and investment company, mutual savings bank, credit union, building and loan association, insurance company, investment company, broker-dealer company, manufacturing company, telecommunications company or surety company or an eligible subsidiary of any of the foregoing. An eligible company does not have to be in existence, be qualified to do business in the state or have any employees in this state at the time its base employment is determined.

(6) "Eligible subsidiary" means each corporation eighty percent (80%) or more of the outstanding common stock of which is owned by an eligible company.

(7) "Full-time equivalent active employee" means any employee of an eligible company who:

(1) works a minimum of thirty (30) hours per week within the State, or two (2) or more part-time employees whose combined weekly hours equal or exceed thirty (30) hours per week within the State; and

(2) earns no less than one hundred fifty percent (150%) of the hourly minimum wage prescribed by Rhode Island law; provided, however, for tax years ending after the later of July 1, 2003 and the first tax year that an eligible company qualifies for a rate reduction pursuant to § 42-64.5-3, for purposes of this section, one hundred fifty percent (150%) of the hourly minimum wage prescribed by Rhode Island law shall mean one hundred fifty percent (150%) of the hourly minimum wage prescribed by Rhode Island law at:

(a) the time the employee was first treated as a full-time equivalent active employee during a tax year that the eligible company qualified for a rate reduction pursuant to § 42-64.5-3, or, if later,

(b) the time the employee first earned at least one hundred fifty percent (150%) of the hourly minimum wage prescribed by Rhode Island law as an employee of the eligible company. For eligible companies qualifying on or after July 1, 2009 for a rate reduction pursuant to § 42-64.5-3, the term "full-time equivalent active employee" means any employee of an eligible company who:

(1) works a minimum of thirty (30) hours per week within the state;

(2) earns healthcare insurance benefits, and retirement benefits; and

(3) earns no less than two hundred fifty percent (250%) of the hourly minimum wage prescribed by Rhode Island law at the later of:

(i) the time the employee was first treated as a full-time equivalent active employee during a tax year that the eligible company qualified for a rate reduction pursuant to § 42-64.5-3; or

(ii) the time the employee first earned at least two hundred fifty percent (250%) of the hourly minimum wage prescribed by Rhode Island law as an employee of the eligible company. For eligible companies qualifying before July 1, 2009 for a rate reduction pursuant to § 42-64.5-3, any new "full-time equivalent active employee," who replaces an existing "full-time equivalent active employee," shall meet the following standards to remain eligible:

(1) works a minimum of thirty (30) hours per week within the state;

(2) earns healthcare insurance benefits, and retirement benefits; and

(3) earns no less than two hundred fifty percent (250%) of the hourly minimum wage prescribed by Rhode Island law at the later of:

(i) the time the employee was first treated as a full-time equivalent active employee during a tax year that the eligible company qualified for a rate reduction pursuant to § 42-64.5-3; or

(ii) the time the employee first earned at least two hundred fifty percent (250%) of the hourly minimum wage prescribed by Rhode Island law as an employee of the eligible company.

(8) "Initial new employment level" means the number of units of new employment reported by an eligible company in 1997, or, if applicable, the third taxable year following the base employment period election set forth in § 42-64.5-5.

(9)

(i) "New employment" means for each taxable year the amount of adjusted current employment for each taxable year minus the amount of base employment, but in no event less than zero; provided, however, no eligible company is permitted to transfer, assign or hire employees who are already employed within the State by such eligible company from itself or any affiliated entity or utilize any other artifice or device for the purpose of artificially creating new employees in order to qualify for the rate reduction provided for in this chapter.

(ii) Except as provided in § 42-64.5-7, "new employment" shall not include employees already employed in this state who become employees of an eligible company as a result of an acquisition of an existing company by purchase, merger, or otherwise, if the existing company was eligible for a rate reduction. In the case of a manufacturing company that suffers a disaster, it shall mean any employment retained or added as the result of reconstruction of the manufacturing facility.

(10) "Rate reduction" means the reduction in tax rate specified in § 42-64.5-4.

(11) "Small business concern" means, except as otherwise provided in § 42-64.5-7, any eligible company which has a base employment level of less than one hundred (100); provided, however, that a telecommunications company may not qualify as a small business concern.

(12) "State" means the State of Rhode Island.

(13) "Telecommunications company" means any public service company or corporation whose rate of taxation is determined under § 44-13-4(4).

(14) "Total employment" for an eligible company as of any date means the total number of full-time equivalent active employees employed within the State by the eligible company and its eligible subsidiaries on such date.

(15) "Units of new employment" means:

(i) for eligible companies which are not small business concerns, the amount of new employment divided by fifty (50), rounded down to the nearest multiple of fifty (50), and

(ii) for eligible companies which are small business concerns the amount of new employment divided by ten (10), rounded down to the nearest multiple of ten (10); provided, however, that an eligible company (other than an eligible company that is a telecommunications company) with adjusted current employment of one hundred (100) or more employees in its first year of operation or in any other period following the date its base employment is determined shall determine its units of new employment by dividing the first one hundred (100) employees less its base employment by ten (10), rounded down to the nearest multiple of ten (10), and by dividing the number of additional employees in excess of one hundred (100) by fifty (50), rounded down to the nearest multiple of fifty (50).

R.I. Gen. Laws § 42-64.5-2

P.L. 1994 , ch. 84, § 1; P.L. 1998 , ch. 111, § 1; P.L. 2000 , ch. 279, § 1; P.L. 2001 , ch. 77, art. 7, §4; P.L. 2003 , ch. 383, § 2; P.L. 2003 , ch. 385, § 2; P.L. 2004 , ch. 333, § 1; P.L. 2004 , ch. 396, § 1; P.L. 2006 , ch. 216, § 41; P.L. 2009 , ch. 68, art. 16, § 12.