Bill H.4067

FILED ON: 12/6/2017

HOUSE . . . . . . . . . . . . . . . No. 4067

The Commonwealth of Massachusetts

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In the One Hundred and Ninetieth General Court
(2017-2018)

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An Act relative to a cranberry bog renovation tax credit.

Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority of the same, as follows:

SECTION 1. Section 6 of chapter 62 of the General Laws, as appearing in the 2016 Official Edition, is hereby amended by adding at the end thereof the following subsection:-

(u) (1) For the purposes of this subsection, the following words shall have the following meanings unless the context clearly requires otherwise:-

“Cranberry bog” or “bog”, an area actively cultivated for the harvesting or production of any variety of cranberry.

"Qualified renovation'', any renovation, repair, replacement, re-grading or restoration of a cranberry bog for the purpose of cultivating, harvesting or producing any variety of cranberry, or otherwise any other activity or action associated with the renovation of an abandoned cranberry bog. The term “qualified renovation” shall not include the construction of facilities or structures for the purpose of processing cranberries.

“Qualified renovation expenditure”, any expenditure or cost directly incurred in connection with the qualified renovation of a cranberry bog. The term “qualified renovation expenditure” shall not include costs incurred in acquiring or purchasing property in relation to the construction of structures for the purpose of cultivating, harvesting or producing cranberries.

“Secretary”, the secretary of energy and environmental affairs.

(2)(i) A taxpayer primarily engaged in cranberry production shall be allowed a refundable credit against the taxes imposed by this chapter equal to 25 per cent of the total qualified renovation expenditures incurred in connection with the qualified renovation of a cranberry bog during the taxable year; provided, however, that the amount of the credit that may be claimed by a taxpayer under this subsection shall not exceed $100,000. If the amount of the credit allowed under this subsection exceeds the taxpayer's tax liability, the commissioner shall treat the excess as an overpayment and shall pay the taxpayer the amount of the excess, without interest. Alternatively, at the option of the taxpayer, a taxpayer entitled to a credit under this subsection for a taxable year may carry over and apply against the taxpayer's tax liability for any 1 or more of the succeeding 5 taxable years, the portion, as reduced from year to year, of the credit which exceeds the tax for the taxable year. If the taxpayer elects to carry over a credit balance, then the credit refund provision allowed by this subsection shall not apply.

(ii) The secretary, in consultation with the commissioner of agricultural resources, shall authorize annually, for the period beginning January 1, 2018 and ending December 31, 2022, tax credits under this subsection together with section 38GG of chapter 63. The total cumulative value of the tax credits authorized pursuant to this section and section 38GG of chapter 63 shall not exceed $2,000,000 annually. No credits shall be allowed under this subsection except to the extent authorized in this paragraph.

(3) For a taxpayer to qualify for the credit provided for under this subsection, the taxpayer shall file with the secretary a summary of qualified renovation expenditures in connection with the qualified renovation. The secretary shall approve the summary of qualified renovation expenditures and provide notice to the commissioner. Any qualified renovation expenditures applicable to this credit shall be treated for purposes of this subsection as made on the date that the secretary provides notice of the certification to the commissioner.

(4) Any portion of tax credits not awarded by the secretary in a calendar year shall not be applied to awards in a subsequent year. The secretary shall provide any documentation that the commissioner may deem necessary to confirm compliance with subparagraph (ii) of paragraph (2) and the commissioner shall provide a report confirming compliance to the secretary of administration and finance.

(5) The secretary shall annually, not later than September 1, file a report with the house and senate committees on ways and means, the chairs of the joint committee on environment, natural resources, and agriculture and the chairs of the joint committee on revenue identifying the total amount of tax credits claimed and the total amount of tax credits refunded pursuant to this subsection in the preceding fiscal year.

(6) The commissioner, in consultation with the secretary and the commissioner of agricultural resources, shall promulgate regulations or other guidelines necessary for the administration and implementation of this subsection.

SECTION 2. Chapter 63 of the General Laws is hereby amended by inserting after section 38FF the following section:-

Section 38GG. (a) For purposes of this section, the following terms shall have the following meanings unless the context clearly requires otherwise:

“Commissioner”, the commissioner of revenue

“Cranberry bog” or “bog”, an area actively cultivated for the harvesting or production of any variety of cranberry.

“Secretary”, the secretary of energy and environmental affairs.

(b)(1) A taxpayer primarily engaged in cranberry production shall be allowed a refundable credit against the taxes imposed by this chapter equal to 25 per cent of the total qualified renovation expenditures incurred in connection with the qualified renovation of a cranberry bog during the taxable year; provided, however, that the amount of the credit that may be claimed by a taxpayer under this section shall not exceed $100,000. If the amount of the credit allowed under this section exceeds the taxpayer's tax liability, the commissioner shall treat the excess as an overpayment and shall pay the taxpayer the amount of the excess, without interest. Alternatively, at the option of the taxpayer, a taxpayer entitled to a credit under this subsection for a taxable year may carry over and apply against the taxpayer's tax liability for any 1 or more of the succeeding 5 taxable years, the portion, as reduced from year to year, of the credit which exceeds the tax for the taxable year. If the taxpayer elects to carry over a credit balance, then the credit refund provision allowed by this section shall not apply.

(2) The secretary, in consultation with the commissioner of agricultural resources, shall authorize annually, for the period beginning January 1, 2018 and ending December 31, 2022, tax credits under this subsection together with subsection (u) of section 6 of chapter 62. The total cumulative value of the tax credits authorized pursuant to this section and subsection (u) of section 6 of chapter 62 shall not exceed $2,000,000 annually. No credits shall be allowed under this section except to the extent authorized in this subsection.

(c) For a taxpayer to qualify for the credit provided for under this section, the taxpayer shall file with the secretary a summary of qualified renovation expenditures in connection with the qualified renovation. The secretary shall approve the summary of qualified renovation expenditures and provide notice to the commissioner. Any qualified renovation expenditures applicable to this credit shall be treated for purposes of this section as made on the date that the secretary provides notice of the certification to the commissioner.

(d) Any portion of tax credits not awarded by the secretary in a calendar year shall not be applied to awards in a subsequent year. The secretary shall provide any documentation that the commissioner may deem necessary to confirm compliance with paragraph (2) of subsection (b) and the commissioner shall provide a report confirming compliance to the secretary of administration and finance.

(e) The secretary shall annually, not later than September 1, file a report with the house and senate committees on ways and means, the chairs of the joint committee on environment, natural resources, and agriculture and the chairs of the joint committee on revenue identifying the total amount of tax credits claimed and the total amount of tax credits refunded pursuant to this section in the preceding fiscal year.

(f) The commissioner, in consultation with the secretary and the commissioner of agricultural resources, shall promulgate regulations or other guidelines necessary for the administration and implementation of this section.