AN ACT RELATIVE TO INVESTMENTS IN EMERGING TECHNOLOGIES TO PROMOTE JOB CREATION, ECONOMIC STABILITY AND COMPETITIVENESS IN THE MASSACHUSETTS ECONOMY.
Whereas , The deferred operation of this act would tend to defeat its purpose, which is to make forthwith supplemental appropriations for one-time costs for certain capital spending, public investment, and bonded debt of the commonwealth, therefore it is hereby declared to be an emergency law, necessary for the immediate preservation of the public convenience.
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. Subparagraph (a) of paragraph (3) of subsection (j) of section 3A of said chapter 21E of the General Laws, as appearing in the 2002 Official Edition, is hereby amended by striking out clause (i) and inserting in place thereof the following clause:-
(i) the proposed redevelopment or reuse of the property will contribute to the economic or physical revitalization of the community in which it is located, and thereby provides the following public benefits, including, but not limited to redevelopment that: (a) provides new, permanent jobs, or (b) results in affordable housing benefits, or (c) provides historic preservation, or (d) creates or revitalizes open space, or (e) will provide some other public benefit to the community as determined by the attorney general; and.
SECTION 2. Subsection (b) of the third paragraph of section 6 of said chapter 21E, as so appearing, is hereby amended by striking out clauses (i), (ii) and (iii) and inserting in place thereof the following clause:-
(i) said owner or operator is not subject to an outstanding administrative or judicial enforcement action under this chapter for a release of oil or hazardous materials at the time of the transfer of the subject property, and (ii) said owner or operator records notice of the restrictions of the use of said property pursuant to section 6 of this chapter, and any regulations promulgated hereunder.
This section was vetoed by the Governor.
SECTION 3. Chapter 23A of the General Laws is hereby amended
by striking out section 3H, as so appearing, and inserting in place thereof the
following section:-
Section 3H. The secretary of economic development
shall appoint the director of the Massachusetts permit regulatory office, who
shall have experience with permitting and business development and who shall serve
as the ombudsman to new and expanding businesses to provide one-stop licensing
for businesses, and development in order to streamline and expedite the process
of obtaining state licenses, permits, state certificates, state approvals, state
registrations, state charters and other requirements of law. The ombudsman shall
communicate with municipal officials responsible for local review procedures to
determine the municipal perspective on the proposed project, and to facilitate
communication between the municipality and state agencies. The Massachusetts permit
regulatory office shall consult with each regional office of the Massachusetts
Office of Business Development, in order to better serve local businesses. Each
executive office and each of the departments of environmental protection, business
and technology, housing and community development, labor, workforce development
and consumer affairs and business regulation shall appoint a senior staff member
who shall be responsible for coordinating the efforts of the commonwealth to provide
one-stop licensing at the state level for businesses and developments in order
to streamline and expedite the process of obtaining state licenses, state permits,
state certificates, state approvals, state registrations, state charters and other
requirements of law. The senior staff members shall meet at least once a month
with the ombudsman and shall meet with each other on a regular basis. The secretary
of administration and finance shall work with the secretary of economic development,
the ombudsman and senior staff members to develop a recommended format for an
application form and procedure which shall be used by all executive offices when
possible. The ombudsman shall file an annual report with the house and senate
committees on ways and means by January 1 of each year on the activities of the
Massachusetts permit regulatory office, including legislative recommendations
on business development and expansion efforts.
SECTION 4. Section 60 of said chapter 23A, as so appearing, is hereby amended by inserting after the word "Fund", in line 110, the following words:- which shall be considered an expendable trust fund on the books of the commonwealth and,- and by striking out the second sentence and inserting in place thereof the following 4 sentences:- All monies credited under this subsection shall remain in said Redevelopment Access to Capital Fund, not subject to appropriation, to meet the obligations of the program set forth in this section. The agency shall not utilize said monies for any purpose other than the redevelopment access to capital fund as established herein. Deposits to the fund shall be made in accordance with section 34 of chapter 29 in such manner as will secure the highest interest rate available consistent with safety of the fund and with the requirement that all amounts on deposit be available for immediate withdrawal at any time. The fund shall be expended only for the purposes of this section at the direction of the agency and any unexpended balances shall be redeposited, as herein provided, for future use consistent with this section.
This section was vetoed by the Governor.
SECTION 4A. Section 9 of chapter 23D of the General Laws,
as appearing in the 2002 Official Edition, is hereby amended by striking out paragraphs
(a) to (g), inclusive, and inserting in place thereof the following paragraph:-
(a) The trust shall be governed by the board of directors of the Massachusetts
Development Finance Agency, established under chapter 23G, and such board may
promulgate, modify, supersede or rescind orders, rules and regulations, by-laws
or guidelines governing the operation of the trust.
This
section was vetoed by the Governor.
SECTION 4B. Said
section 9 of said chapter 23D, as so appearing, is hereby further amended by striking
out the letter (h), in line 58, and inserting in place thereof the letter (b),-
and by striking out, in line 64, the letter (i) and inserting in place thereof
the letter (c).
This section was vetoed by the
Governor.
SECTION 4C. Said chapter 23D is hereby amended
by striking out section 10, as so appearing, and inserting in place thereof the
following section:-
Section 10. The offices of the trust shall be
located in the offices of the Massachusetts development finance agency. The executive
director of said agency shall be the chief executive, operational and administrative
officer of the trust and shall direct the resources and staff of the trust to
achieve the purposes of the trust.
This section
was vetoed by the Governor.
SECTION 4D. Section 3 of
chapter 23G of the General Laws, as so appearing, is hereby amended by adding
the following clause:-
(34) to execute the powers of the economic
stabilization trust and other powers conferred pursuant to sections 8 to 16, inclusive
of chapter 23D.
SECTION 5. Said chapter 23G of the General Laws is hereby amended by striking out sections 27 and 28, as so appearing, and inserting in place thereof the following 2 sections:-
Section 27. (a) There is hereby established and placed within the agency the Emerging Technology Fund, referred to in this section as the fund, to which shall be credited any appropriations, bond proceeds or other monies authorized by the general court and specifically designated to be credited thereto, such additional funds as are subject to the direction and control of the agency, any pension funds, federal grants or loans or private investment capital which may properly be applied in furtherance of the objectives of the fund, any proceeds from the sale of qualified investments secured or held by the fund, any fees and charges imposed relative to the making of qualified investments, as the same shall be defined by the advisory committee created pursuant to section 28 and pursuant to rules approved by the agency for the fund, secured or held by the fund, and any other monies which may be available to the agency for the purposes of the fund from any other source or sources. The agency shall hold the fund in an account or accounts separate from other funds or accounts.
(b) The agency shall invest and reinvest the fund and the income thereof, except as hereinafter provided, only as follows: (1) in the making of qualified investments, pursuant to rules approved by the agency; (2) in defraying the ordinary and necessary expenses of administration and operation associated with the fund; (3) in the investment of any funds not required for immediate disbursement in the purchase of such securities as may be lawful investments for fiduciaries in the commonwealth; (4) for the payment of binding obligations associated with such qualified investments which are secured by the fund as the same become payable; and (5) for the payment of principal or interest on qualified investments secured by the fund or the payment of any redemption premium required to be paid when such qualified investments are redeemed prior to maturity; provided, however, that monies in the fund shall not be withdrawn at any time in such an amount as would reduce the amount of the fund to less than the minimum requirement thereof established by the agency, except for the purpose of paying binding obligations associated with qualified investments which are secured by the fund as the same become payable.
(c) The fund shall be held and applied by the agency to make qualified investments designed to advance the following public purposes: (1) to stimulate increased financing for new manufacturing, research and development and related facilities in the commonwealth by leveraging private financing for highly, productive state-of-the-art facilities, which will lead to increased and more rewarding employment opportunities for the citizens hereof by providing financing related thereto including, without limitation, financing of the construction or expansion of such new facilities, including specialized real estate improvements and specialized equipment therefor; and (2) to make matching grants to universities, colleges, public instrumentalities, companies and other entities to induce the federal government, industry and other grant-funding sources to fund advanced research and development activities in new and emerging technologies and new application of existing technologies in the commonwealth, and to thereby serve to increase and strengthen the commercial and industrial base of the commonwealth and the economic development and employment opportunities related thereto; (3) to provide bridge financing to universities, colleges, public instrumentalities, companies and other entities in anticipation of the receipt of grants of the type described in clause (2) awarded or to be awarded by the federal government, industry or other sources.
The agency shall make no such qualified investment pursuant to clause (1) of subsection (b) unless the agency finds that, to the extent possible, said qualified investment is such that a definite benefit to the economy of the commonwealth may reasonably be expected therefrom. In addition, the agency shall make no such qualified investment pursuant to said clause (1) of said subsection (b) unless such qualified investment is in conformity with rules approved by the agency.
Said rules shall define which industries within the commonwealth shall be considered "emerging technology industries" for purposes hereof, provided that such term shall include industries employing new or state-of-the-art technology in biotechnology, pharmaceuticals, defense and homeland security-related technologies, advanced materials, electronics, nanotechnology, environmental, medical device, information technology, plastics and polymers, telecommunications industries involved in the research and development of state-of-the-art medication delivery devices or any other technological field or industry which the advisory committee and the agency has classified or shall classify as an emerging technology. Said rules shall also set the terms and conditions for investments which are to constitute qualified investments, which may include, without limitation, loans, guarantees, loan insurance or reinsurance, equity investments, grants made only pursuant to clause (2) of subsection (c), or other financing or credit enhancing devices, as made by the agency directly or on its own behalf or in conjunction with other public instrumentalities, or private institutions, or the federal government, provided further, that said rules and regulations shall provide that each such qualified investment made pursuant to clause (1) of said subsection (c) shall involve a transaction with the participation of at least two at-risk private parties and that the qualified investment provided in any particular instance provides no more than 25 per cent of the overall financing of the new manufacturing, research and development or related facility referred to therein.
Said rules shall, in addition, set forth the terms, procedures, standards and conditions which the agency shall employ to identify qualified applications, process applications, make investment determinations, safeguard the fund, advance the objective of increasing employment opportunities for the citizens of the commonwealth, oversee the progress of qualified investments, and secure the participation of other public instrumentalities, private institutions, or the federal government in such qualified investments; provided, however, that said rules shall provide that each recipient of a qualified investment shall be required to pay a fee as a condition of such receipt, which fee may take the form of points, an interest rate premium or a contribution of warrants or other form of equity or consideration to the fund as prescribed by the advisory committee; and provided, further, that said rules shall provide for negotiated agreements between the agency and each recipient of a qualified investment regarding the terms and conditions by which the fund's support thereof could be reduced or withdrawn.
(d) The agency may solicit investments by private institutions or investors in the activities of the fund and may reach agreements with such private institutions or investors regarding the terms of any such investments including, without limitation, the rights of such investors to participate in the income or appropriation of the fund. In furtherance of the objective of securing investments by private institutions or investors in the activities of the fund as set forth in the preceding sentence, the agency may develop a proposal relative to the creation of a separate investment entity which would allow for the commingling of the resources of the fund with the maximum participation by such private institutions or investors in a manner which is consistent with the public purpose of the fund and under terms and conditions calculated to protect and preserve the assets of the fund; provided, however, that if the creation or operation of such a separate entity as proposed by the agency would require additional or clarifying amendments to the enabling act of the agency, said proposal shall include proposed statutory language with regard thereto.
(e) Copies of the approved rules, and any modifications thereto, shall be submitted to the chairpersons of the house and senate committees on ways and means and the clerks of the house of representatives and senate.
(f) Qualified investment transactions undertaken by the agency pursuant to the provisions of this section shall not, except as specified in this act, be subject to the provisions of chapter 175, or any successor thereto, and shall be payable solely from the Emerging Technology Fund, established by this section and shall not constitute a debt or pledge of the faith and credit of the commonwealth, the agency or any subdivision of the commonwealth.
(g) The agency shall not at any time make expenditure from or commitment of the assets of the fund, including, without limitation, the making of qualified investments secured by the fund, if following the making of said qualified investment, the amount of the fund shall be less than the minimum requirement established by law, unless the agency, at the time of making of such qualified investment, deposits in the fund from the proceeds thereof or from any fees and charges imposed relative to the making of qualified investments, or otherwise, an amount which, together with the amount in the fund, shall not be less than the minimum requirement; provided, however, that at no time shall the minimum requirement of the fund be less than the maximum amount of principal and interest becoming due in the current and succeeding fiscal year of the agency on all outstanding bonds and other obligations which are secured by the fund or such greater amount as may be set forth in the rules governing the fund.
(h) In making the initial disbursements from the fund, not less than $2,500,000 shall be disbursed over a 5 year period to each of the 5 geographic regions of the state, the central area, the greater Boston area, the north east area, the south east area and the western area, as those areas are defined generally as follows:
"Central area", the Northern Worcester Service Delivery Area and the Southern Worcester Service Delivery Area as specified in 20 CFR 661.280;
"Greater Boston Area", the Boston Service Delivery Area, the Metropolitan North Service Delivery Area and the Metropolitan South/West Service Delivery Area as specified in 20 CFR section 661.280;
"North East Area", the Lower Merrimack Valley Service Delivery Area, the Northern Middlesex Service Delivery Area and the Southern Essex Service Delivery Area as specified in 20 CFR 661.280;
"South East Area", the Bristol Service Delivery Area, the Brockton Service Delivery Area, the Cape and Islands Service Delivery Area, the New Bedford Service Delivery Area and the South Coastal Service Delivery Area as specified in 20 CFR 661.280; and
"Western Area", the Berkshire Service Delivery Area, Franklin/Hampshire Service Delivery Area and Hampden Service Delivery Area as specified in 20 CFR 661.280.
Section 28. (a) There is hereby established an advisory committee relative to the fund consisting of the director of business and technology, and 6 other persons, 3 to be appointed by the governor and 3 to be appointed by the board of the agency; provided, however, that said director of business and technology may designate another person from time to time to act in his or her place for a particular purpose, including the right to attend and vote at a meeting of the advisory committee; provided, further, that at least two members of the advisory committee appointed by the governor shall be representatives of an emerging technology industry and at least one member of the advisory committee appointed by the governor shall have knowledge of financing of emerging technology companies, and provided, further, that at least one member of the advisory committee appointed by the board of the agency shall be a representative of an emerging technology industry, and at least one member of the advisory committee appointed by the board of the agency shall have knowledge of financing of emerging technology companies and one member of the advisory committee appointed by the board of the agency shall be a member of the agency's board of directors. The executive director of the Massachusetts Technology Park Corporation shall serve as an ex-officio member of said advisory committee.
Each appointed member of the advisory committee shall serve for a term of 3 years and thereafter until such member's successor is appointed; provided, however, that of those initially appointed, 1 of each the governor's appointees and the board of the agency's appointees shall serve for a term of 1 year, 1 of each of the governor's appointees and the board of the agency's appointees shall serve for a term of 2 years, and 1 of each the governor's appointees and the board of the agency's appointees shall serve for a term of 3 years. Any person appointed to fill a vacancy on the advisory committee shall be appointed in a like manner and shall be eligible for reappointment. Any member of the advisory committee appointed by the governor may be removed by the governor for cause. Any member of the advisory committee appointed by the board of the agency may be removed by the board of the agency for cause. The advisory committee and the agency are encouraged to award 1 or more contracts with regard to the management of the fund, which may provide performance-based incentives, with regard to such management.
(b) The members shall elect annually a chairman and vice chairman and shall adopt by-laws governing the affairs of the advisory committee. Four members of the advisory committee shall constitute a quorum and the affirmative vote of a majority of the members present and eligible to vote at a meeting shall be necessary for any action to be taken by the advisory committee; and, provided, that except as set forth in the preceding clause, no vacancy in the membership of the advisory committee shall impair the right of a quorum to exercise the powers of the advisory committee.
The members shall serve without compensation, but each member shall be entitled to reimbursement for actual and necessary expenses incurred in the performance of official duties. The advisory committee may meet as often as the members shall decide provided, that it shall meet at least once in each calendar quarter and its approval shall be necessary for any expenditure from or commitment of the assets of the fund or entry into contracts of the type specified in the last sentence of subsection (a), provided, that the advisory committee may, by majority vote, elect, in its discretion, to delegate some or all of said approval rights to the board or the staff of the agency provided that any such delegation may be revoked at any time by majority vote of the advisory committee. The agency shall manage the qualified investments made from the fund including, without limitation, the closing, servicing, monitoring, underwriting, and where appropriate, the enforcement of rights with respect thereto and shall provide such staff and supporting assistance as deemed appropriate by the board of directors of the Agency to enable the advisory committee to discharge its duties in a manner consistent with its public purpose. The provisions of subsection (d), and subsections (f) to (i), inclusive, and subsection (l) of section 2 shall apply as well to the members and affairs of the advisory committee created pursuant to this section.
SECTION 6. Chapter 23H of the General Laws is hereby amended by adding the following 3 sections:-
Section 8. As used in sections 8 to 10, inclusive, the following words shall have the following meanings:
"Eligible service provider", a community-based nonprofit organization that provides workforce development services, such as job skills training, education, placement services, and supportive services.
"Potential employee target groups", persons receiving TAFDC, older adults, immigrants, persons residing in economic opportunity areas, and other persons who are underemployed or unemployed.
"Qualifying consortium", a collaborative program of service that includes a community-based nonprofit organization or union/labor-management program or institution of higher education and an employer.
Section 9. A health professions worker training grant program is established for the purpose of responding to the need for workers in various health care professions, subject to the requirements of section 2RR of chapter 29.
A qualifying consortium shall apply for grant funding from the fund in the manner specified by the director.
Applications for grants must describe targeted participants of the proposed grant application and must describe the specific critical work force shortage the program is designed to alleviate. The application must include verification that in the process of determining that a critical work force shortage exists in the target area, the applicant has (1) consulted available data on worker shortages and (2) conferred with employers in the target area.
Within the limits of available appropriations, the director shall make grants not to exceed $200,000 each to qualifying consortia to provide workforce development services which may lead to employment in the health professions. Grant awards must establish specific, measurable outcomes and timelines for achieving those outcomes.
A qualifying consortium shall implement a marketing and outreach strategy to recruit into the health care professions persons from one or more of the potential employee target groups. Recruitment strategies must include: a screening process to evaluate whether potential employees may be disqualified as the result of a required background check or are otherwise unlikely to succeed in the position for which they are being recruited; and a process for modifying course work to meet the training needs of non-English-speaking persons, when appropriate.
High school students participating in a training program shall not be permitted to work more than 20 hours per week when school is in session.
Section 10. By April 1, 2004, the state workforce investment board shall develop performance standards for workforce development and job training programs receiving state funding. The standards may vary across program types. The state workforce investment board may contract with a consultant to develop the performance standards. The state workforce investment board shall consult with stakeholder advocacy groups, community-based nonprofit service providers, and local workforce investment boards in the development of both performance standards and reporting requirements. The standards must at a minimum measure: the employability levels of individuals as defined by basic skill level, the amount of work experience, and barriers to employment prior to program entry; the individual's annual income and employability level for the 12 months prior to entering the program, the starting annual income upon placement after completing the program, employability level and annual income one year after completion of the program, and the individual's reported satisfaction; the program completion rate, placement rate, employability level upon placement, and one-year retention rate; and the cost per placement and per job retained at one year and the percentage of program funding coming from the state and other levels of government.
Commencing April 1, 2005, all workforce development services and job skills training programs receiving state funds must submit an annual performance report to the state workforce investment board. The state workforce investment board may develop a uniform format for the report and prescribe the manner in which the report is required to be submitted.
By December 31 of each odd-numbered year and commencing December 31, 2005, the director of the department of workforce development, in consultation with the state workforce investment board, shall submit recommendations to the house and senate clerks regarding modifications to, including the elimination of, existing statutory requirements with respect to workforce development and job training programs. The recommendations shall include recommendations regarding funding levels required to meet worker and employer skill development needs, with a particular focus on low income and low wage workers.
This section
was vetoed by the Governor.
SECTION 7. Chapter 26 of
the General Laws is hereby amended by inserting after section 8J the following
section:-
Section 8K. (a) There shall be an independent council to
be known as the Health Insurance Cost Containment Council.
(b) The
council shall consist of 16 voting members, composed of and appointed in accordance
with the following:
(1) the secretary of the executive office of health
and human services;
(2) the commissioner of the division of insurance;
(3) the commissioner of the division of medical assistance;
(4) two representatives of the business community, at least 1 of whom represents
small business, who are purchasers of health care, none of which is primarily
involved in the provision of health care or health insurance, 1 of whom shall
be appointed by the president of the senate and 1 of whom shall be appointed by
the speaker of the house of representatives from a list of 7 qualified persons
recommended by the Associated Industries of Massachusetts of which 3 nominees
shall be representatives of small business;
(5) two representatives
of organized labor, 1 of whom shall be appointed by the president of the senate
and one of whom shall be appointed by the speaker of the house of representatives
from a list of 5 qualified persons recommended by the Massachusetts AFL-CIO;
(6) one representative to represent consumers, appointed by the governor
from a list of 3 qualified persons recommended by the executive director of Health
Care for All;
(7) one representative of hospitals, appointed by the
governor from a list of 3 qualified hospital representatives recommended by the
Massachusetts Hospital Association; but the representative under this paragraph
may appoint a delegate to act for the representative only at meetings of committees
as provided for in subsection (g);
(8) one representative of physicians,
appointed by the governor from a list of 3 qualified physician representatives
recommended by the Massachusetts Medical Society; but the representative under
this paragraph may appoint a delegate to act for the representative only at meetings
of committees as provided for in subsection (g);
(9) one representative
of nurses, appointed by the governor from a list of 3 qualified persons recommended
by the Massachusetts Nurses Association and the Massachusetts Organization of
Nurses Executives;
(10) one representative from a health maintenance
organization, appointed by the governor from a list of 3 qualified persons recommended
by the Massachusetts Association of Health Plans;
(11) one representative
of chiropractors, appointed by the governor from a list of three qualified chiropractor
representatives recommended by the Massachusetts Chiropractic Society;
(12) one representative of a health insurer, other than a health maintenance organization,
appointed by the governor from a list of 3 qualified persons recommended by the
commissioner of insurance; and
(13) in the case of each appointment
to be made from a list supplied by a specified organization, it is incumbent upon
that organization to consult with and provide a list that reflects the input of
other equivalent organizations representing similar interests. Each appointing
authority shall have the discretion to request additions to the list originally
submitted. Additional names will be provided not later than 15 days after the
request. Appointments shall be made by the appointing authority no later than
90 days after receipt of the original list. If, for any reason, any specified
organization supplying a list should cease to exist, then the respective appointing
authority shall specify a new equivalent organization to fulfill the responsibilities
of this section.
(c) The members of the council shall annually elect,
by a majority vote of the members, a chairperson and a vice chairperson of the
council.
(d) The division of insurance, the division health care finance
and policy, and the division of medical assistance shall assist the council in
the furtherance of its mission. The council may accept and expend grants, in-kind
services, and other assistance from the federal government, private non-profit
foundations, or other sources to support its work.
(e) Seven members
shall constitute a quorum for the transaction of any business, and the act by
the majority of the members present at any meeting in which there is a quorum
shall be considered to be the act of the council.
(f) All meetings
of the council shall be advertised and conducted pursuant to chapter 30A unless
otherwise provided in this section.
(1) The council shall meet
at least once every 2 months, and may provide for special meetings as it considers
necessary. Meeting dates shall be set by a majority vote of the members of the
council or by the call of the chairperson upon seven days' notice to all council
members.
(2) All meetings of the council shall be publicly advertised,
as provided for in this section, and shall be open to the public, except that
the council, through its bylaws, may provide for executive sessions of the council.
No act of the council shall be taken in an executive session as defined in section
11A of chapter 30A.
(3) The council shall file a schedule of its meetings
with the state secretary and shall publish a schedule of its meetings in at least
2 newspapers, one newspaper in general circulation in the commonwealth. The notice
shall be published and filed at least once in each calendar quarter and shall
list the schedule of meetings of the council to be held in the subsequent calendar
quarter. The notice shall specify the date, time and place of the meeting and
shall state that the council's meetings are open to the general public, except
that a notice shall not be required for executive sessions of the council.
(4) All action taken by the council shall be taken in open public session,
and action of the council shall not be taken except upon the affirmative vote
of a majority of the members of the council present during meetings at which a
quorum is present.
(g) The council shall adopt bylaws, not inconsistent
with this act, and may appoint such committees or elect such officers subordinate
to those provided for in subsection (c) as it considers advisable. The council
shall provide for the approval an participation of additional delegates appointed
under paragraphs (7) and (8) of subsection (b) so that each organization represented
by delegates under those paragraphs shall not have more than 1 vote on any committee
to which they are appointed. The council shall also appoint a technical advisory
group which shall, on an ad hoc basis, respond to issues presented to it by the
council or committees of the council and shall make recommendations to the council.
The technical advisory group shall include actuaries, researchers and biostatisticians.
The members of the council shall not receive a salary or per diem
allowance for serving as members of the council but shall be reimbursed for actual
and necessary expenses incurred in the performance of their duties. The expenses
may include reimbursement of travel and living expenses while engaged in council
business.
(i) The terms of the secretary of the executive office of
health and human services, the commissioner of the division of medical assistance
and the commissioner of the division of insurance shall be concurrent with their
holding of public office. The 9 appointed council members shall each serve for
a term of 3 years and shall continue to serve thereafter until their successor
is appointed, except that, of the members first appointed:
(1) One
of the representatives of business and the representative of consumers shall serve
for a term to expire on June 30 of the year following his initial appointment.
(2) One of the representatives of organized labor and the representative
of a carrier shall serve for a term to expire on June 30 of the second year following
his initial appointment.
(3) The other representatives of business
and organized labor and the representatives of hospitals, physicians and health
maintenance organizations shall serve for a term to expire on June 30 of the third
year following their initial appointments.
(4) Vacancies on the council
shall be filled in the same manner in which they were originally designated under
subsection (b), within 60 days of the vacancy, except that when vacancies occur
among the representatives of business or organized labor, 2 nominations shall
be submitted by the organization specified in subsection (b) for each vacancy
on the council. If the officer required subsection (b) to make appointments to
the council fails to act within 60 days of the vacancy, the council chairperson
may appoint 1 of the persons recommended for the vacancy, until the appointing
authority makes the appointment.
(j) A member may be removed for just
cause by the appointment authority after recommendation by a vote of at least
8 members of the council.
(k) (1) Within 60 days after the effective
date of this section, each organization or individual required to submit a list
of recommended persons to the governor, the president of the senate or the speaker
of the house of representatives under subsection (b) shall submit the list.
(2) Within 90 days of the effective date of this act, the governor, the
president of the senate and the speaker of the house of representatives shall
make all of the appointments called for in subsection (b), and the council shall
begin operations immediately following these appointments.
(l) Submission
of lists of recommended persons and appointments of council members for the second
and succeeding terms shall be made in the same manner as prescribed in subsection
(b), except that:-
(1) Organizations required under subsection (b)
to submit lists of recommended persons shall do so at least 60 days prior to expiration
of the council members' terms.
(2) The officer required under subsection
(b) to make appointments to the council shall make said appointments at least
30 days before expiration of the council members' terms. If the appointments are
not made within the specified time, the council chairperson may make interim appointments
from the lists of recommended individuals. An interim appointment shall be valid
only until the appropriate officer under subsection (b) makes the required appointment.
Whether the appointment is by the required officer or by the chairperson of the
council, the appointment shall become effective immediately upon expiration of
the incumbent member's term.
(m) Should any organization or individual
fail to submit a list of recommended persons as required under subsection (b)
within the time limits in subsection (k) or (m), the officer designated to make
the appointment under subsection (b) shall appoint as many acting councilors as
required under subsection (b) until such time as the list of recommended persons
is submitted by the original organization as required in subsection (b).
(n) The council shall make recommendations for administrative and legislative
reforms that encourage the use of quality and safety initiatives to promote more
cost effective delivery of health care in the commonwealth. The council shall
make recommendations relative to initiatives that will lead to more affordable
health insurance for employers and employees, including an examination of methods
of providing health care to the working uninsured of the commonwealth. The council
shall examine the feasibility and desirability of establishing a permanent health
care cost containment system to control health costs through quality improvements
that ensure successful patient outcomes. The council shall examine cost containment
systems of other lines of insurance and the impact of such systems on health insurance
premiums including but not limited to the workers' compensation system and the
unemployment insurance system and the council shall examine the impact of the
current medical liability system on health care costs.
(o) The council
shall report annually to the committees on ways and means of the house of representatives
and the senate and the joint committees on health care; insurance; and commerce
and labor, and may recommend legislation to implement its findings.
SECTION 8. Paragraph (1) of subsection (b) of section 2RR of chapter 29 of the General Laws, as appearing in the 2002 Official Edition, is hereby amended by adding the following clause:-
(ix) whether the employer has recently or plans to locate its business in the commonwealth and employ residents of the commonwealth who will benefit from training, provided that said employer shall not receive funds until said employer has located its business in the commonwealth.
This
section was vetoed by the Governor.
The Governor's
veto was overridden by the Legislature
SECTION 9. Said section
2RR of said chapter 29, as so appearing, is hereby further amended by adding the
following 6 subsections:-
(f) The director, in consultation with the secretary of economic development, shall adopt regulations to carry out the purposes of this section, including the criteria set forth in paragraph (1) of subsection (b). The regulations shall provide for a rolling applications process and shall allow employers with plans to locate in the commonwealth and employ commonwealth residents to apply for grants. The director may contract with a private organization to carry out some or all of the director's duties provided in this section.
The board may require a match or co-investment from participating organizations; provided, however, that in determining the amount of any match, the board shall establish different requirements for organizations based on the size of the organization, its profit or not-for-profit status and financial capacity.
(g) Documentary materials or data made or received by an employee of the department of workforce development, or previously by the division of employment and training, to the extent that such materials or data consist of trade secrets or commercial or financial information regarding the operation of a business conducted by an applicant for a grant from the fund established by this section, shall not be public records and shall not be subject to section 10 of chapter 66.
(h) The director shall, in accordance with section 328 of chapter 127 of the acts of 1999, prepare a performance evaluation of the workforce training grants awarded under this section. The evaluation shall assess the effectiveness of each grant awarded in terms of the (1) development of employee skills; (2) increase in employee wages; (3) improvement in employee retention rates; (4) improvement of employee productivity; (5) impact on employer's business and (6) impact on regional economy, including reduction of regional unemployment levels. The director shall require, as a condition of receiving a grant under this section, employers to provide, within a time frame following the end of the grant period as established by the director, such information and data determined by the director to be necessary to complete the performance evaluation.
(i) The director shall make no grant under this section to any person or entity from the Fund, nor shall any technical assistance be provided by the department out of the proceeds of the Fund, to any person or entity unless the person or entity applies for and receives a certificate of tax in good standing with the department of revenue with respect to all tax types for which it should be registered and for which it is obligated to file reports or returns. A certified copy of the certificate shall be presented to the director before the issuance of any grant under this section before the department's providing any technical assistance to the person or entity.
(j) There is hereby established a board to be known as the Workforce Training Fund Advisory Board, consisting of 9 members, who are citizens of the commonwealth, to be appointed by the governor. Three members shall be persons representing businesses or employers; 3 shall be persons representing employees or employees of labor organizations, 2 of whom shall be selected from a list of 5 recommended by the President of the Massachusetts AFL-CIO; and 3 shall be persons representative of the public, 2 of whom shall have expertise or experience in workforce training and 1 of whom shall represent a non-profit workforce training provider. The governor shall designate as chairman of the advisory board 1 of the members appointed as representative of the public. Members shall serve for a term of 6 years. Of the members originally appointed, 1 employer representative and 1 employee representative shall serve for a term of 4 years, and 1 employer representative and 1 employee representative shall serve for a term of 6 years; and thereafter, as their terms expire, the governor shall appoint members for terms of 6 years. Vacancies shall be filled by appointment by the governor for the remainder of the unexpired term. All members shall serve until the qualification of their respective successors. Members shall serve without compensation. The advisory board shall advise the director of the department of workforce development on the administration of the workforce training fund grant program, including but not limited to reviewing and making recommendations on grant requirements and selection criteria and reviewing grant applications and making recommendations about grant awards. The advisory board shall, from time to time, submit recommendations to the legislature on any legislative changes it deems necessary for the successful operation of the program.
(k) To provide technical assistance to increase
training opportunities available to employees. The director may provide this direct
technical assistance by using existing institutions such as local workforce investment
boards, community colleges, labor organizations, administrative entities for service
delivery areas under the federal Workforce Investment Act, or its successor statute,
and other entities that have expertise in providing technical assistance regarding
employee training or with employees of the departments of labor and workforce
development or of the commonwealth corporation. Such expenditures shall not exceed
$3,000,000 each year and the director shall demonstrate that each dollar expended
generates not less than $5 in private investment in job training. Of the $3,000,000,
not less than $75,000 shall be provided annually to the Workforce Investment Board
Association to support the activities of business, labor, education, youth councils
and community members in leading regional workforce development systems; each
of the 16 workforce investment boards shall receive $75,000 annually; and each
of the 16 workforce investment boards shall receive $20,000 annually for youth
councils.
SECTION 10. Said section 2RR of said chapter 29, as so appearing, is hereby further amended by striking out, in line 33, the figure "$250,000" and inserting in place thereof the following figure:- $1,000,000.
SECTION 11. Said section 2RR of said chapter 29 is hereby further amended by striking out the figure "$1,000,000", inserted by section 10 of this act, and inserting in place thereof the following figure:- $250,000.
SECTION 12. Notwithstanding any general or special law to the contrary, the workforce training fund advisory board shall report every 6 months on the grantees, the amount of each grant, the geographic distribution of the grants, and the number of workers served by each grant. The report shall be submitted to the joint committee on commerce and labor and the house and senate ways and means committees.
SECTION 13. Said chapter 29 is hereby further amended by inserting after section 2LLL, inserted by section 162 of chapter 26 of the acts of 2003, the following section:-
2MMM. (a) There is hereby established and set up on the books of the commonwealth a separate fund to be known as the Massachusetts Mathematics, Science, Technology and Engineering Grant Fund, hereinafter referred to as the pipeline fund, to which shall be credited any appropriations, bond proceeds or other monies authorized by the general court and specifically designated to be credited thereto, and additional funds designated by the corporation for deposit to the pipeline fund, including any pension funds, federal grants or loans, or private donations made available to the chancellor of higher education for the purpose. The board of higher education shall hold the pipeline fund in an account or accounts separate from other funds or accounts. Amounts credited to the pipeline fund shall be used by the chancellor of higher education, in consultation with the Massachusetts Development Finance Agency and the Massachusetts Technology Park Corporation to carry out the purposes of subsection (b).
(b) The public purpose of the pipeline fund shall be to increase the number of Massachusetts students who participate in programs that support careers in fields related to mathematics, science, technology, and engineering. In furtherance of this public purpose, and in a manner consistent with the recommendations of the subcommittee on science, mathematics, technology and engineering education of the Massachusetts council of economic advisors, the chancellor of higher education, in consultation with the commissioner of the department of education and the president of the University of Massachusetts, shall employ the pipeline fund through grants and other disbursements and activities that are calculated to increase the number of qualified mathematics, technology, engineering and science teachers in the commonwealth and to improve the mathematics, technology, engineering and science educational offerings available in public and private schools. The grants and other disbursements and activities may involve, without limitation, the University of Massachusetts, state and community colleges, business and industry partnerships, workforce investment boards, private colleges and universities, and public and private schools, and school districts to work together to further the purposes of the pipeline fund. The grants and other disbursements and activities may support, without limitation: (i) the development and use of innovative curricula, courses and programs in mathematics, technology, engineering and science for new teachers and in-service teachers that provide appropriate mathematics, technology, engineering and science content, and instruction in innovative ways to teach mathematics, technology, engineering and science, including but not limited to the use of hands on, experimental learning, and that are consistent with the Massachusetts standards and curriculum frameworks established pursuant to sections 1D and 1E of chapter 69 but, not less than $360,000 dollars shall be allocated to support a collaborative planning effort among six Workforce Investment Boards to develop a pilot high school Science, Technology, Engineering and Mathematics Internship program (S.T.E.M.) designed to increase the number of high school students pursuing post-secondary education in S.T.E.M. careers.; (ii) the development of a mathematics, science, technology and engineering network to create, implement, share and make broadly and publicly available best practices and innovative programs relative to mathematics, technology, engineering and science instruction and expanding and maintaining student interest in mathematics, science, technology and engineering studies and careers; (iii) effective ways to teach mathematics, technology, engineering and science; and (iv) give priority to grants that provide effective course and curricula for in-service teachers in low income schools or school districts. Not more than 20 per cent of the fund may be warded to any single institution.
(c) The board of higher education shall promulgate policies, rules and regulations consistent with this chapter to implement subsections (a) and (b). The chancellor of higher education shall file any such policies, rules, and regulations with the joint committee on education, arts, and humanities for review and comment at least 30 days before the effective date of the policies, rules, and regulations.
This
section was vetoed by the Governor.
SECTION 14. Section
1 of chapter 30A of the General Laws, as appearing in the 2002 Official Edition,
is hereby amended by inserting after paragraph (5) the following paragraph:-
(5A) "Regulatory impact statement" a statement by the promulgating agency
which shall, to a reasonable degree of completeness: (i) identify the statutory
change, problem, issue or deficiency addressed by the proposed regulation; (ii)
identify the methodology or approach, including identification of expert information
and analysis, used to address the statutory change, problem, issue or deficiency;
(iii) identify specifically who is affected and to what extent by the proposed
regulation; (iv) identify when such regulation becomes effective, when such regulation
will be changed, if known, and how and when the regulation will be reviewed in
the future, if at all; (v) identify the fiscal effect on the public and private
sectors for the first and second year of the regulation's existence, and provide
a projection of fiscal impact over the first 5 years; and (vi) identify and describe
specifically the benefits of the regulation. Any data, including written information
or material, statistics, measurements, calculations or other information used
as the basis for reasoning, recommendation or conclusions, including any such
information provided to the agency by a consultant, vendor or other third party,
shall be part of the record and available to the public upon request.
This section was vetoed by the Governor.
SECTION
15. Section 2 of said chapter 30A, as so appearing, is hereby amended
by inserting after the third paragraph the following paragraph:-
Every
agency issuing rules and regulations shall maintain a notification list of persons
and groups who are interested in the agency's rulemaking and who request preliminary
notification of agency rulemaking, with such request renewed annually by persons
or groups in December. No later than 30 days before the notice of hearing described
above, the agency shall send a preliminary notification of agency rulemaking to
each person or group who has requested preliminary notification of rulemaking
and to the appropriate committee of the general court that has jurisdiction for
the rule issuing agency, and to the ways and means committees of the house of
representatives and the senate. The preliminary notification of rulemaking shall:
(i) identify the rule to be noticed for hearing and the scope of the proposed
rule; (ii) provide the statutory authority for such proposed rulemaking; and (iii)
identify the person within the agency responsible for the rulemaking and who can
be contacted for more information.
This section
was vetoed by the Governor.
SECTION 16. Section 3 of
said chapter 30A, as so appearing, is hereby amended by inserting after the second
paragraph the following paragraph:-
Every agency issuing rules and
regulations shall maintain a notification list of persons and groups interested
in the agency's rulemaking and who request preliminary notification of agency
rulemaking, such request renewed annually by persons and groups in December. No
later than 30 days prior to the notice described above the agency shall send a
preliminary notification of agency rulemaking to each person or group who has
requested preliminary notification of agency rulemaking and to the appropriate
committee of the general court that has jurisdiction for the rule issuing agency
and to the ways and means committees of the house of representatives and the senate.
The preliminary notification shall: (i) identify the rule to be noticed and the
scope of the proposed rule; (ii) provide the statutory authority for such proposed
rulemaking; and (iii) identify the person within the agency responsible for the
rulemaking and who can be contacted for further information.
This
section was vetoed by the Governor.
SECTION 17. The second
paragraph of section 5 of said chapter 30A of the General Laws, as so appearing,
is hereby amended by striking out the first sentence and inserting in place thereof
the following 2 sentences:-
No rule or regulation so filed with the
state secretary, except those filed for the purpose of setting rates, issuing
grants or providing loans, and except those filed by the department of telecommunications
and energy or the division of insurance, shall become effective until a regulatory
impact statement has been completed, made public during the hearing process described
above and is filed with the state secretary. The secretary of economic development
shall review all regulatory impact statements prior to their filing with the state
secretary to ensure and certify that a proper methodology and approach was used
by the agency submitting said impact statement and to certify that the impact
statement as submitted complies with the definition of "regulatory impact statement"
as set forth in section 1 of chapter 30A.
SECTION 18. Chapter 40J of the General Laws is hereby amended by inserting after section 6 thereof the following section:-
Section 6A. (a) The corporation shall establish an institute for regional innovation, technology and competitiveness, to be known as the John Adams Innovation Institute, and a fund to be known as the Innovation Institute Fund, to be held by the corporation separate and apart from its other funds, to finance the activities of said institute. The executive director of the corporation shall appoint a qualified individual as director to manage the affairs of said institute. The corporation, on recommendation of the executive director, shall appoint 7 qualified individuals to a governing board to assist the corporation in matters related to said institute and said fund and in matters related to the research center matching fund established in section 4F, including a president of a state or community college, head of an emerging technology company, a representative of a regional planning agency, and a technology transfer officer or individual qualified in technology commercialization from a university in the commonwealth. The executive director, the director of the office of business and technology, and the president of the Massachusetts development finance agency shall serve as ex-officio members of said governing board. Said board shall consult with the house and senate committees on science and technology and ways and means during the preparation of a detailed plan for the operation of said institute and the matching fund. Upon approval of such detailed plan by the board of directors of the corporation, said board shall delegate such authority to the governing board of the institute as it deems appropriate to implement such plan. The members of said governing board shall be deemed to be directors for purposes of the fourth paragraph of section 3. The purpose of the institute shall be to serve as an agent of the commonwealth to create and maintain a more favorable and responsive environment in the commonwealth for the development, growth, attraction and retention of technology-intensive and innovation-driven clusters of organizations, with a particular attention paid to promoting economic growth in discrete and underserved regions of the commonwealth by harnessing local support and involvement in such economic development activities and by improving the economic infrastructure for such clusters. In furtherance of these public purposes, the institute shall endeavor to identify regions of the commonwealth in which compelling opportunities to make strategic investments appear to be present and develop strategies therefor. The institute may also provide development support more generally to organizations in regions across the commonwealth to assist the formation and growth of emerging technology sectors in those regions and may provide support to departments, agencies, and quasi-public entities of the commonwealth for activities that are consistent with the purposes of the institute. The institute may work in collaboration with the Massachusetts technology collaborative, other quasi-public and not-for-profit agencies. Successful grants should incorporate regional involvement through alliances among municipalities, colleges, business and industry, community based organizations, non-profits and labor unions. Insofar as apt, in the determination of the board, the provisions of this chapter that apply to centers and to the center fund shall apply to said institute and to the innovation institute fund, respectively. Without limiting the generality of the foregoing, the corporation may apply moneys in said fund to start-up expenses and project costs of said institute and related activities, grants to nonprofit or other organizations to develop proposals for regional economic growth in key technology sectors, business incubator development, entrepreneurial training investment in one or more privately managed emerging technology sector investment funds, development of industry-university cooperative research centers, industry networking support, business plan preparation, market research, infrastructure repair and construction, workforce development including, but not limited to, providing funds for programs that provide education and training to enhance the skills of low skilled workers, brokered business assistance services and marketing expenses, provided that written notice shall be given to the house and senate committees on ways and means at least 10 business days before any disbursement of funds amounting to $250,000 or more. The institute shall also file an annual report of its activities with the house and senate committees on science and technology and ways and means.
(b) No grant shall be awarded from the innovation institute fund without the corporation first having consulted with the appropriate regional competitiveness council or sub-regional competitiveness council established by the department of business and technology. The request for consultation shall be submitted not less than 15 business days prior to the execution of any grant award contract. All successful grant applications shall define specific goals and expected outcomes and contain corresponding accountability measures. Applicants that fail to meet these accountability measures shall be barred from pursuing any additional grants under this section for 5 years from the effective date of the grant. Notwithstanding any general or special law or rule or regulation to the contrary, in order to support regional economic development throughout the commonwealth, any organization found to be eligible to receive financial assistance from the innovation institute fund in support of certain specified purposes and activities shall be deemed to be eligible as well to receive financial assistance for such specified purposes and activities as qualified investments of the emerging technology fund established pursuant to section 27 of chapter 23G of the General Laws and a portion of the emerging technology fund shall be allocated and reserved for such application.
(c) In making the initial round of grants from the innovation institute fund, no less than $500,000 shall be distributed over a 3 year period to each of the 5 geographic regions of the state, the central area, the greater Boston area, the north east area, the south east area and the western area, as those areas are defined generally as follows:
"Central Area", the Northern Worcester Service Delivery Area and the Southern Worcester Service Delivery Area as specified in 20 CFR 661.280;
"Greater Boston Area", the Boston Service Delivery Area, the Metropolitan North Service Delivery Area and the Metropolitan South/West Service Delivery Area as specified in 20 CFR section 661.280;
"North East Area", the Lower Merrimack Valley Service Delivery Area, the Northern Middlesex Service Delivery Area and the Southern Essex Service Delivery Area as specified in 20 CFR 661.280;
"South East Area", the Bristol Service Delivery Area, the Brockton Service Delivery Area, the Cape and Islands Service Delivery Area, the New Bedford Service Delivery Area and the South Coastal Service Delivery Area as specified in 20 CFR 661.280; and
"Western Area", the Berkshire Service Delivery Area, Franklin/Hampshire Service Delivery Area and Hampden Service Delivery Area as specified in 20 CFR 661.280.
SECTION 19. Said chapter 40J is hereby further amended by inserting after section 4E the following 2 sections:-
Section 4F. (a) There is hereby established and set up on the books of the corporation the Massachusetts Research Center Matching Fund, hereinafter referred to as the "matching fund," to which shall be credited the proceeds of any bonds or notes of the commonwealth issued for the purpose, and any appropriations designated by the general court to be credited thereto. The matching fund shall be administered by the John Adams Innovation Institute established by section 6A. The corporation shall hold the matching fund in an account or accounts separate from other funds of the corporation. The purpose of the matching fund is to provide matching funds to be available to institutions of higher education and other nonprofit research institutions located in the commonwealth in connection with applications by such institutions for scientific or engineering research funding from the federal government or other sources or in connection with collaborative academic research centers and for projects to support technology platforms and industry cluster development supported by the corporation, provided, however, that any such grant awarded in accordance with this section shall leverage at least $1 for each dollar granted.
This fund shall also support Centers of Excellence, hereinafter referred to as Centers, for research and innovations in targeted emerging technologies. Centers shall (i) perform basic research relevant to its targeted sector, (ii) enhance the development of technology in the targeted sector, (iii) provide technical assistance to current or prospective companies involved in the targeted sector for product development, (iv) involve or employ higher education and secondary education students and faculty in research and in the center's operations, (v) facilitate faculty externships and student internships in targeted sector industries, and (vi) provide incumbent employee training for high level sector related skills. To be designated a Center, the following must be demonstrated: (1) an expertise in the targeted technology sector; (2) a collaboration with other institutions of higher education; (3) a collaboration with 1 or more industries and nonprofit partners; and (4) a creation of an advisory board that represents its targeted sector related stakeholders. In the first year, 3 such Centers shall target the research and development of medical devices, nanotechnology and biotechnology. One of the first 2 Centers shall be located in southwestern Massachusetts, and the other shall be located in northeastern Massachusetts. Any funds allocated for Centers shall be matched in the first year with at least $1 from federal or private funding sources for each dollar granted. The match requirements shall increase in subsequent years to at least $2 from federal or private sources for each $1 granted. Two-thirds of the matched funds may be in-kind. The corporation shall adopt rules and regulations for the administration of the matching fund, which rules and regulations shall be transmitted 60 days in advance to the executive office for administration and finance, the department of economic development, the house and senate committees on ways and means and the house and senate committees on science and technology.
(b) There shall be a broadband access oversight council within the Massachusetts Technology Park Corporation for the purpose of increasing broadband internet services in underserved communities. The council shall be comprised of 12 members, 1 of whom shall be designated by the Franklin-Hampshire Connect; 1 of whom shall be designated by the Berkshire Connect; 1 of whom shall be designated by the Massachusetts Association of Regional Planning Agencies; 1 of whom shall be designated by the Massachusetts Municipal Association; 1 of whom shall be the secretary of economic affairs; 1 of whom shall be the chairman of the commonwealth development council; 1 of whom shall be the chairman of the department of telecommunications and energy; and 5 of whom shall be appointed by the governor, one of whom shall be a representative from the telecommunications industry. The council shall develop and recommend strategies to achieve broadband internet expansion to every community in the commonwealth. Specifically the council shall: (1) identify communities that lack broadband internet service and leverage the telecommunications purchasing power of the commonwealth and the private sector to bring broadband internet service to every community in the commonwealth; (2) identify appropriate technologies and strategies to bring broadband internet service into underserved communities; (3) identify specific state properties that, if made available, would facilitate the deployment of these technologies to achieve service in under-served areas; and (4) take other action considered necessary to fulfill the goal of broadband marketplace choice in underserved communities. The council shall annually submit any recommendations and make periodic reports on progress being made towards achieving these goals to the department of business and technology, the house and senate committees on science and technology, the joint committee on commerce and labor, and the house and senate committees on ways and means.
SECTION 20. Section 6 of chapter 62 of the General Laws, as appearing in the 2002 Official Edition is hereby amended by striking out, in lines 213 and 214, the words "within five years from the effective date of this section" and inserting in place thereof the following words:- on or before August 5, 2005.
This section was vetoed by the Governor.
SECTION 21. Said section 6 of said chapter 62, as so appearing,
is hereby amended by adding the following subsection:-
(l)(1) For
the purposes of this subsection the following words shall, unless the context
clearly requires otherwise, have the following meanings:-
"Medical
device", an instrument, apparatus, implement, machine, contrivance, implant, in
vitro reagent, or other similar or related article, including a component part
or accessory which is recognized in the official National Formulary or the United
States Pharmacopoeia, or any supplement to them, intended for use in the diagnosis
of disease or other conditions, or in the cure, mitigation, treatment, or prevention
of disease, in humans or other animals, or intended to affect the structure or
any functions of the body of humans or other animals, and which does not achieve
any of its primary intended purposes through chemical action within or on the
body of a human or other animals and which is not dependent upon being metabolized
for the achievement of any of its primary intended purposes.
"Medical
device company", a sole proprietorship, partnership, limited liability company,
corporate trust, corporation or other business, in each case (i) the income of
which is taxed directly to the business or its owners under this chapter and (ii)
having a facility located in the commonwealth which develops or manufactures medical
devices.
"User fees", the monetary amount actually paid by a medical
device company to the United States Food and Drug Administration during the taxable
year for a pre-market approval to market new technologies developed or manufactured
in the commonwealth, or for a 510(k) clearance to market upgrades, changes or
enhancements to existing technologies that are developed or manufactured in the
commonwealth as stipulated in United States Public Law 107-250, the Medical Device
User Fee and Modernization Act.
(2) There shall be allowed to any
medical device company as a credit against the tax liability imposed under this
chapter, an amount equal to 50 per cent of the cost of user fees paid by such
medical device company during the taxable year for which the tax is due.
(3) The commissioner shall promulgate rules and regulations to implement
this section.
(4) The commissioner shall establish a business tax
benefit transfer program to allow medical device companies doing business in the
commonwealth with unused tax benefits to surrender such benefits for use by a
purchasing company in exchange for private financial assistance to be provided
by such company to assist in the funding of coasts incurred by the medical device
company.
The private financial assistance shall be used to fund expenses
incurred in connection with the operation of the medical device company in the
commonwealth including costs associated with fixed assets such as the construction
and acquisition and development of real estate, materials, start-up, tenant fit-out,
working capital, salaries, research and development expenditures and any other
expenses determined by the commissioner to be necessary to carry out the purposes
of the program.
A medical device company which participates in the
program shall file an application with the department of revenue, on a form prescribed
by the commissioner setting forth the tax benefit amounts eligible for transfer,
the use to which the medical device company intends to put the private financial
assistance to be provided, the identity of the purchasing company, the amount
of the financial assistance to be provided, and such other information as the
commissioner may require.
No such tax benefits may be surrendered
unless the purchasing company provides financial assistance in an amount at least
equal to 75 per cent of the tax benefit amounts eligible for transfer.
The commissioner shall review such application and, if the proposed transfer meets
the requirements set forth in this section, it shall, , upon receipt of a notarized
statement signed under the pains and penalties of perjury by an authorized representative
of the medical device company that the purchasing company reflecting the tax benefit
amounts transferred, a copy of which shall be attached to each tax return filed
by a purchasing company in which such tax benefits are used.
The purchasing
company shall treat benefit amounts purchased under the program as a credit against
its tax liability. The purchasing company must use the tax benefit amounts so
treated in tax returns filed within 5 years of the issuance of the certificate,
after which the benefits will be considered to have expired. The purchasing company
may not use the tax benefit amounts to reduce the income tax to less than the
amount due under section 4.
A medical device company surrendering
tax benefits under the program shall not use the benefits to reduce its tax liability
under this chapter.
SECTION 22. Chapter 62 of the General Laws, as appearing in the 2002 Official Edition, is hereby amended by inserting after section 6I the following section:-
Section 6J. (a) For purposes of this section, the following terms shall have the following meanings unless the context clearly requires otherwise:
"Certified rehabilitation", the rehabilitation of a qualified historic structure that has been approved and certified by the chairman of the Massachusetts historical commission as being consistent with the standards established by the Secretary of the United States Department of the Interior for rehabilitation of historic properties.
"Qualified historic structure", any building or structure, located within the commonwealth that is individually listed on the National Register of Historic Places or is a contributing building within a district that is listed on the National Register of Historic Places or which has been determined by the Massachusetts historical commission to be eligible for listing on the National Register of Historic Places, and which all or any portion of which is owned, in whole or in part, by the taxpayer.
"Qualified rehabilitation expenditure", any amount properly chargeable to a capital account and is of a character subject to federal depreciation allowance under section 47 of the Internal Revenue Code, as amended and in effect for the taxable year, incurred in connection with the certified rehabilitation of a qualified historic structure, provided that such term shall not include any personal property or the cost of acquiring any building or interest thereon.
"Substantial rehabilitation" and "substantially rehabilitated", the qualified rehabilitation expenditures of the building during the 24-month period selected by the taxpayer ending with or within the taxable year exceed 25 per cent of the taxpayer's adjusted basis in such building and its structural components as of the beginning of such period. In the case of any rehabilitation that may reasonably be expected to be completed in phases set forth in architectural plans and specifications completed before the rehabilitation begins, the applicable period referred to in this paragraph shall be 60 months.
"Taxpayer", a person, firm, partnership, trust, estate, limited liability company or other entity subject to the income tax imposed by the provisions of this chapter.
(b)(1) There is hereby established a Massachusetts historic rehabilitation tax credit. The department of revenue, in consultation with the Massachusetts historical commission may authorize annually, for the 5-year period beginning January 1, 2005, and ending December 31, 2009, under this section together with section 38R of chapter 63, an amount not to exceed $10,000,000; provided, further, that the department of revenue in consultation with the Massachusetts historical commission, shall, whenever possible, authorize no less than 25 per cent of the tax credits to projects that contain affordable housing. The Massachusetts historical commission, in consultation with the department of revenue, shall administer and determine eligibility for the Massachusetts historic rehabilitation tax credit and allocate the credit in accordance with the provisions of this section.
Any taxpayer subject to taxation under this chapter that incurs qualified rehabilitation expenditures shall be allowed a credit, to be computed as hereinafter provided, against the tax imposed by this chapter. The amount of the credit shall be equal to 20 per cent of the qualified rehabilitation expenditures made by such taxpayer with respect to a qualified historic structure, and may only be taken by the taxpayer upon completion of the rehabilitation work and approval of such work as provided for in this section.
(2) The credit allowable under this section shall be allowed for the taxable year in which the substantially rehabilitated property is placed in service, that is, when occupancy of the entire structure or some identifiable portion of the structure is permitted.
If the Massachusetts historic rehabilitation tax credit allowable for any taxable year exceeds the taxpayer's tax liability for the year in which the substantially rehabilitated property is placed in service, the amount that exceeds the taxpayer's tax liability may be carried forward for credit against the taxes imposed for the succeeding 5 years, or until the full credit is used, whichever occurs first. Historic rehabilitation tax credits allowed to a partnership, a limited liability company taxed as a partnership or multiple owners of property shall be passed through to the persons designated as partners, members or owners, respectively, pro rata or pursuant to an executed agreement among such persons designated as partners, member or owners documenting an alternative distribution method without regard to their sharing of other tax or economic attributes of such entity.
Taxpayers eligible for the Massachusetts historic rehabilitation tax credit may assign, transfer or convey the credits, in whole or in part, by sale or otherwise to any individual or entity, and such transferee shall be entitled to offset income imposed by this chapter with the same effect as if such transferee had incurred the qualified rehabilitation expenditures. The assignor shall perfect such transfer by notifying the department of revenue in writing within 90 days following the effective date of said transfer, and shall provide any information as may be required by the department of revenue to administer and carry out the provisions of this section.
(c)(1) A certified rehabilitation shall require:
(i) an initial certification by the Massachusetts historical commission that the structure meets the definition of qualified historic structure;
(ii) a second certification by the Massachusetts historical commission, to be issued prior to construction, certifying that if completed as proposed, the rehabilitation work will meet the standards required for a certified rehabilitation; and
(iii) a final certification by the Massachusetts historical commission, issued when construction is completed, certifying that the work was completed as proposed and that the costs are consistent with the work completed. Such final certification shall be acceptable as proof that the expenditures related to such construction qualify as qualified rehabilitation expenditures for purposes of the credit allowed under this section.
(2) A rehabilitation shall not be treated as complete before the date of the certification referred to in clause (iii) of paragraph (1).
(d) A taxpayer who leases his property shall be treated as the owner thereof if the remaining term of the lease as of the date determined under regulations prescribed by the department of revenue is not less than such minimum period as the regulations require.
(e) The percentage of the total expenditures made in the rehabilitation of the exterior of a building containing condominium dwelling units shall be attributed to each such unit within the building, based upon the percentage of space each unit occupies within the building, and in the case of a building where less than the entire building is used as a residence of the taxpayer, only the portion of the total expenditures made in the rehabilitation of the building that is attributable to the residence of the taxpayer shall be treated as qualified rehabilitation expenditures.
(f) For any qualified historic structure, qualified rehabilitation expenditures applicable to the historical rehabilitation tax credit shall be treated for purposes of this section as made:
(i) on the date substantial rehabilitation is completed, or
(ii) to the extent provided by the commissioner of revenue by regulation, when such expenditures are properly chargeable to a capital account. Regulations under this paragraph shall include a rule similar to the rule under section 50(a)(2) of the Internal Revenue Code, as amended an in effect for the taxable year, relating to recapture if property ceases to qualify for progress expenditures.
(g)(1) If, before the end of the 5-year period beginning on the date on which the rehabilitation of the building is completed the taxpayer disposes of such taxpayer's interest in such building, then the taxpayer's tax imposed by this chapter for the taxable year in which such disposition or cessation occurs, shall be increased by the recapture percentage of the credit allowed under this section for all prior taxable years with respect to such rehabilitation.
(2) For purposes of paragraph (1), the recapture percentage shall be the product of the amount of credit claimed by the taxpayer multiplied by a ratio, the numerator of which is the number of months the building is owned by the taxpayer or, in the case of a homeowner, used as the taxpayer's residence and the denominator of which is 60.
(h) For purposes of this section, if a credit is allowed under this section for any expenditure with respect to any property, the increase in the basis of such property which would, but for this paragraph, result from such expenditure shall be reduced by the amount of the credit so allowed.
(i) The department of revenue in consultation with the Massachusetts historical commission, shall prescribe such regulations as may be appropriate to carry out the purposes of this section, including the imposition of a fee for the processing of applications for the certification of any rehabilitation under this section; provided, however, that the amount of such fee is used only to defray expenses associated with the processing of such applications.
(j) Except for unused credits carried forward pursuant to paragraph (2) of subsection (b) of section 38R of chapter 63 and paragraph (2) of subsection (b) of this section, a taxpayer shall not be eligible for any historic rehabilitation tax credits for more than 5 taxable years.
SECTION 23. Chapter 62C of the General Laws is hereby amended by inserting after section 67C the following section:-
Section 67D. (a) When used in this section, the following words shall have the following meaning:
"Application year", the calendar year for which a biotechnology or medical device manufacturing company submits the information required for a determination as to a jobs incentive payment.
"Biotechnology company", a business primarily engaged in the research, development, production or provision of biotechnology for the purpose of developing or providing products or processes for specific commercial or public purposes including, but not limited to, medical, pharmaceutical, nutritional and other health-related purposes or a person engaged in providing services or products necessary for such research, development, production or provision. This term shall include contract manufacturers engaged in the production of biotechnology products for a biotechnology company or a medical device manufacturing company.
"Business", a corporation, sole proprietorship, partnership, limited liability company or any other form of business organization.
"Commissioner", the commissioner of revenue.
"Eligible Jobs", a number determined by first multiplying each of the local jobs created by a biotechnology or medical device manufacturing company during a single calendar year by the job qualifier for that job, and then totaling the number for all of the local jobs created.
"Full time employee", a person who is employed for consideration for at least 35 hours per week and whose salary is subject to withholding as provided in chapter 62B.
"Job qualifier fraction", in the case of either a full-time employee or a part-time employee of a biotechnology or medical device manufacturing company, the figure that determines the extent to which that employee is employed in the commonwealth during a single calendar year. The job qualifier fraction for each employer shall be determined by multiplying the following percentages together: (i) the percentage of time that an employee worked while employed by the company expressed as average hours worked per week out of 35 hours, not to exceed 100 per cent; (ii) that employee's time attributable to work in the commonwealth, as a portion of that employee's total work for the company; and (iii) the portion of the year the employee worked for the company.
"Jobs incentive payment", a business employment incentive payment for biotechnology or medical device manufacturing companies as provided for in this section.
"Local jobs created", the total number of jobs created by a biotechnology or medical device manufacturing company during a single calendar year in which the new employees perform qualified services at least 1 in-state location, including jobs performed by persons that are transferred within the company to work at an in-state location from a location based outside the state.
"Medical device manufacturing company", a business primarily engaged in manufacturing medical or surgical instruments, surgical appliances or supplies or electromedical, electrotherapeutic or irradiation apparatus. This term shall include contract manufacturers engaged in the production of such products for a medical device manufacturing company or a biotechnology company.
"Part-time employee", a person who is employed for consideration for less than 35 hours a week and whose salary is subject to withholding as provided in chapter 62B.
"Payment years", in the case of a biotechnology or medical device manufacturing company that is determined to be eligible for a jobs incentive payment, the 3 calendar years following the application year.
"Qualified services", direct production manufacturing services performed by an employee of a biotechnology or medical device manufacturing company during a calendar year that consist primarily of at least 1 of the following services: medicinal and botanical manufacturing, pharmaceutical and preparation manufacturing, in vitro diagnostic substance manufacturing, biological product, except diagnostic, manufacturing, surgical and medical instrument manufacturing, electromedical and electrotherapeutic apparatus manufacturing, surgical appliance and supplies manufacturings and irradiation apparatus manufacturing. These services are as referenced in the federal NAICS Codes for biotechnology manufacturing, numbers 325411-325414, 339112, 314510, 339113 and 334517, respectively.
"Weighted, average employment", for a calendar year, the total number of jobs maintained by a biotechnology or medical device manufacturing company in which the employees performed employment services at at least 1 in-state location. The number is to be determined by first multiplying each of the individual jobs maintained by the company for that year by the job qualifier fraction for that job and then totaling the number for all of these jobs.
(b) A biotechnology or medical device manufacturing company that creates 10 or more eligible jobs in the commonwealth during a single calendar year shall be entitled to a jobs incentive payment if its weighted average employment for such year reflects a net increase of at least 10 jobs over the company's weighted average employment for the prior calendar year. The jobs incentive payment shall be equal to 50 per cent multiplied by the applicable Massachusetts income tax rate for the salary paid to the persons who perform the newly created eligible jobs for the calendar year in question; provided, however, that such salary shall be subject to Massachusetts withholding pursuant to chapter 62B for such year. For the purposes of this provision, an eligible job shall be deemed created in the commonwealth on the first day for which Massachusetts withholding is required in connection with the compensation paid to the employee.
(c) The jobs incentive payment shall be paid to a biotechnology or medical device manufacturing company in 3 equal installments in each of the 3 calendar years commencing with the calendar year subsequent to the application year. If, for the first or second payment year, the company's weighted average employment falls below its weighted average for the application year, the company shall be disqualified from receiving its second installment payment, it may still receive its third installment payment if its weighted average employment for its second payment year is above its weighted average employment for the application year.
(d) A biotechnology or medical device manufacturing company that seeks a jobs incentive payment shall apply to the commissioner to receive such payment on a form to be prescribed by the commissioner. This form shall reference the necessary information concerning the eligible jobs created by the company in the Commonwealth during the application year and also the company's weighted average employment for such year and the prior calendar year. The commissioner shall advise the company of his determination in writing.
(e) Not later than March 1 of each calendar year for which a biotechnology or medical device manufacturing company has been approved to receive a jobs incentive payment, the company shall submit to the commissioner, in a form prescribed by the commissioner, the information necessary to evaluate the company's prior year weighted employment average.
(f) A biotechnology or medical device manufacturing company that has previously been approved to receive a jobs incentive payment is entitled to re-apply for an additional payment for a second or third application year. In such cases, the company may be entitled to receive a jobs incentive payment that relates to different application years in the same calendar year. When a company has previously been granted a jobs incentive payment for 3 application years, it shall not request an additional jobs incentive payment.
(g) The commissioner shall issue payments, as authorized in subsection (b), without further appropriation. The commissioner may issue rules and regulations as necessary or helpful to implement this section, including rules and regulations to ensure compliance with this section.
SECTION 24. Chapter 63 of the General Laws is hereby amended by inserting after section 38Q the following section:-
Section 38R. (a) For purposes of this section, the following terms shall have the following meanings unless the context clearly requires otherwise:
"Certified rehabilitation", the rehabilitation of a qualified historic structure that has been approved and certified by the chairman of the Massachusetts historical commission as being consistent with the standards established by the Secretary of the United States Department of the Interior for rehabilitation of historic properties.
"Qualified historic structure", any building or structure, located within the commonwealth that is individually listed on the National Register of Historic Places or is a contributing building within a district that is listed on the National Register of Historic Places or which has been determined by the Massachusetts historical commission to be eligible for listing on the National Register of Historic Places, and which all or any portion of which is owned, in whole or in part, by the taxpayer.
"Qualified rehabilitation expenditure", any amount properly chargeable to a capital account and, in the case of a taxpayer claiming an income-producing credit, is of a character subject to federal depreciation allowance under section 47 of the Internal Revenue Code, as amended and in effect for the taxable year, incurred in connection with the certified rehabilitation of a qualified historic structure, provided that such term shall not include any personal property or the cost of acquiring any building or interest thereon.
"Substantial rehabilitation" and "substantially rehabilitated", the qualified rehabilitation expenditures of the building during the 24-month period selected by the taxpayer ending with or within the taxable year exceed 25 per cent of the taxpayer's adjusted basis in such building and its structural components as of the beginning of such period. In the case of any rehabilitation that may reasonably be expected to be completed in phases set forth in architectural plans and specifications completed before the rehabilitation begins, the applicable period referred to in this paragraph shall be 60 months.
"Taxpayer", a corporation subject to an excise imposed by this chapter.
(b)(1) There is hereby established a Massachusetts historic rehabilitation tax credit. The department of revenue in consultation with the Massachusetts historical commission, may authorize annually, for the 5 year period beginning January 1, 2005, and ending December 31, 2009, under this section together with section 6J of chapter 62, an amount not to exceed $10,000,000 provided, further, that the department of revenue in consultation with the Massachusetts historical commission, shall, whenever possible, authorize no less than 25 per cent of the tax credits to projects that contain affordable housing. The Massachusetts historical commission, in consultation with the department of revenue, shall administer and determine eligibility for the Massachusetts historic rehabilitation tax credit and allocate the credit in accordance with the provisions of this section.
A taxpayer that incurs qualified rehabilitation expenditures shall be allowed a credit, to be computed as hereinafter provided, against the tax imposed by this chapter. The amount of the credit shall be equal to 20 per cent of the qualified rehabilitation expenditures made by such taxpayer with respect to a qualified historic structure, and may only be taken by the taxpayer upon completion of the rehabilitation work and approval of such work as provided for in this section.
(2) The credit allowable under this section shall be allowed for the taxable year in which the substantially rehabilitated property is placed in service, that is, when occupancy of the entire structure or some identifiable portion of the structure is permitted.
If the credit allowed under this section for any taxable year exceeds the taxpayer's tax liability for the year in which the substantially rehabilitated property is placed in service, the amount that exceeds the taxpayer's tax liability may be carried forward for credit against the taxes imposed for the succeeding 5 years, or until the full credit is used, whichever occurs first. Any credits allowed under this section which are provided to multiple owners of property shall be passed through to the persons designated as partners, members or owners, respectively, pro rata or pursuant to an executed agreement among such persons designated as partners, member or owners documenting an alternative distribution method without regard to their sharing of other tax or economic attributes of such entity.
Any taxpayer entitled to a credit under this section may assign, transfer or convey the credits, in whole or in part, by sale or otherwise to any individual or entity, and such transferee shall be entitled to offset income imposed by this chapter with the same effect as if such transferee had incurred the qualified rehabilitation expenditures. The assignor shall perfect such transfer by notifying the department of revenue in writing within 90 days following the effective date of said transfer and shall provide any information as may be required by the department of revenue to administer and carry out this section.
(c)(1) A certified rehabilitation shall require:
(i) an initial certification by the Massachusetts historical commission that the structure meets the definition of qualified historic structure;
(ii) a second certification by the Massachusetts historical commission, to be issued prior to construction, certifying that if completed as proposed, the rehabilitation work will meet the standards required for a certified rehabilitation; and
(iii) a final certification by the Massachusetts historical commission, issued when construction is completed, certifying that the work was completed as proposed and that the costs are consistent with the work completed. Such final certification shall be acceptable as proof that the expenditures related to such construction qualify as qualified rehabilitation expenditures for purposes of the credit allowed under this section.
(2) A rehabilitation shall not be treated as complete before the date of the certification referred to in clause (iii) of paragraph (1).
(d) A taxpayer who leases its property shall be treated as the owner thereof if the remaining term of the lease as of the date determined under regulations prescribed by the commissioner of revenue is not less than such minimum period as the regulations require.
(e) The percentage of the total expenditures made in the rehabilitation of the exterior of a building containing condominium dwelling units shall be attributed to each such unit within the building, based upon the percentage of space each unit occupies within the building, and in the case of a building where less than the entire building is used as a residence of the taxpayer, only the portion of the total expenditures made in the rehabilitation of the building that is attributable to the residence of the taxpayer shall be treated as qualified rehabilitation expenditures.
(f) For any qualified historic structure, qualified rehabilitation expenditures shall be treated for purposes of this section as made:
(i) on the date substantial rehabilitation is completed, or
(ii) to the extent provided by the commissioner of revenue by regulation, when such expenditures are properly chargeable to a capital account. Regulations under this paragraph shall include a rule similar to the rule under section 50(a)(2) of the Internal Revenue Code, as amended and in effect for the taxable year, relating to recapture if property ceases to qualify for progress expenditures.
(g)(1) If, before the end of the 5-year period beginning on the date on which the rehabilitation of the building is completed the corporation disposes of such corporation's interest in such building, then the tax imposed by this chapter for the taxable year in which such disposition or cessation occurs, shall be increased by the recapture percentage of the credit allowed under this section for all prior taxable years with respect to such rehabilitation.
(2) For purposes of paragraph (1), the recapture percentage shall be the product of the amount of credit claimed by the corporation multiplied by a ratio, the numerator of which is the number of months the building is owned by the taxpayer and the denominator of which is 60.
(h) For purposes of this section, if a credit is allowed under this section for any expenditure with respect to any property, the increase in the basis of such property which would, but for this paragraph, result from such expenditure shall be reduced by the amount of the credit so allowed.
(i) The department of revenue in consultation with the Massachusetts historical commission, shall prescribe such regulations as may be appropriate to carry out the purposes of this section, including the imposition of a fee for the processing of applications for the certification of any rehabilitation under this section; provided, however, that the amount of such fee is used only to defray expenses associated with the processing of such applications.
(j) Except for unused credits carried forward pursuant to paragraph (2) of subsection (b) of section 6J of chapter 62 and paragraph (2) of subsection (b) of this section, a taxpayer shall not be eligible for any historic rehabilitation tax credits for more than 5 taxable years.
SECTION 25. Section 31A of said chapter 63, as most recently amended by section 206 of chapter 26 of the acts of 2003, is hereby further amended by striking out paragraphs (k) and (l) and inserting in place thereof the following 2 paragraphs:-
(k) Paragraphs (a) and (f) shall not be available for the taxable years ending on or after December 31, 1993.
(l) Paragraphs (i) and (j) shall be available only for the taxable years ending on or after December 31, 1993.
This
section was vetoed by the Governor.
SECTION 26. Said
chapter 63 is hereby further amended by inserting after section 31H the following
section:-
Section 31I. (a) For the purposes of this section the following
words shall have the following meanings, unless the context clearly requires otherwise:
"Medical device", an instrument, apparatus, implement, machine, contrivance,
implant, in vitro reagent, or other similar or related article, including a component
part, or accessory which is recognized in the official National Formulary, or
the United States Pharmacopoeia, or any supplement to them, intended for use in
the diagnosis of disease or other conditions, or in the cure, mitigation, treatment,
or prevention of disease, in humans or other animals, or intended to affect the
structure or any function of the body of humans or other animals, and which does
not achieve any of its primary intended purposes through chemical action within
or on the body of a human or other animals and which is not dependent upon being
metabolized for the achievement of any of its primary intended purposes.
"Medical device company", (1) a domestic corporation organized under or
subject to chapter 156B, (2) a limited liability company organized under chapter
156C and otherwise subject to this chapter, or (3) a corporation, organization
or association established, organized or chartered under laws other than those
of the commonwealth and otherwise subject to this chapter, and in each case which
has a usual place of business within the commonwealth wherein medical devices
are developed or manufactured.
"User fees", the monetary amount actually
paid by medical device companies to the United States Food and Drug Administration
during the taxable year for a pre-market approval to market new technologies developed
or manufactured in the commonwealth, or for a 510(k) clearance to market upgrades,
changes or enhancements to existing technologies that are developed or manufactured
in the commonwealth as stipulated in United States Public Laws 107-250, the Medical
Device User Fee and Modernization Act.
(b) There shall be allowed
to any medical device company as a credit against the tax liability imposed under
this chapter, an amount equal to 50 per cent of the cost of user fees paid by
the medical device company during the taxable year for which the tax is due.
(c) The commissioner shall promulgate rules and regulations to implement
this section.
(d) The commissioner shall establish a business tax
benefit transfer program to allow medical device companies doing business in the
commonwealth with unused tax benefits to surrender such benefits for use by a
purchasing company in exchange for private financial assistance to be provided
by such company to assist in the funding of costs incurred by the medical device
company.
The private financial assistance shall be used to fund expenses
incurred in connection with the operation of the medical device company in the
commonwealth including costs associated with fixed assets such as the construction
and acquisition and development of real estate, materials, start-up, tenant fit-out,
working capital, salaries, research and development expenditures and any other
expenses determined by the commissioner to be necessary to carry out the purposes
of the program.
A medical device company which participates in the
program shall file an application with the department of revenue, on a form prescribed
by the commissioner setting forth the tax benefit amounts eligible for transfer,
the use to which the medical device company intends to put the private financial
assistance to be provided, the identity of the purchasing company, the amount
of the financial assistance to be provided, and such other information as the
commissioner may require.
No such tax benefits may be surrendered
unless the purchasing company provides financial assistance in an amount at least
equal to 75 per cent of the tax benefit amounts eligible for transfer.
The commissioner shall review such application and, if the proposed transfer meets
the requirements set forth in this section, it shall, upon receipt of a notarized
statement signed under the pains and penalties of perjury by an authorized representative
of the medical device company that the purchasing company reflecting the tax benefit
amounts transferred, a copy of which shall be attached to each tax return filed
by a purchasing company in which such tax benefits are used.
The purchasing
company shall treat benefit amounts purchased under the program as a credit against
its excise under this chapter. The purchasing company shall use the tax benefit
amounts so treated in tax returns filed within 5 years of the issuance of the
certificate, after which the benefits will be considered to have expired. The
purchasing company may not use the tax benefit amounts to reduce the excise to
less than the amount due under subsection (b) of section 32, or subsection (b)
of section 39.
No medical device company surrendering tax benefits
under the program may use such benefits to reduce its tax liability under this
chapter.
SECTION 27. Said chapter 63 is hereby further amended by striking out section 38C, as amended by section 24 of chapter 4 of the acts of 2003, and inserting in place thereof the following section:-
Section 38C. Every corporation organized under or subject to chapter 156B and every limited liability company organized under chapter 156C which is not classified as a partnership and has elected to be taxed as a corporation separate from its members for federal income tax purposes which is engaged in manufacturing herein, or in research herein and development shall for the purposes of this chapter be deemed to be a domestic manufacturing corporation, or a domestic research and development corporation. Corporations that are engaged in research and development and that conduct manufacturing activities shall exclude expenditures related to manufacturing from total expenditures for the purpose of assessing whether 2/3 of expenditures are allocable to research and development, whether or not the manufacturing activities of the corporation are substantial.
A domestic research and development corporation for the purposes of this section is one whose principal activity herein is research and development and which, during the taxable year, derives more than 2/3 of its receipts attributable to the commonwealth from the activity or incurs more than 2/3 of its expenditures attributable to the commonwealth, allocable to such activity; provided however, that a corporation that qualifies as a domestic research and development corporation only by reason of its expenditures shall not be entitled to the credit provided in section 31A by virtue of its qualification as a domestic research and development corporation. Corporations engaged in both research and development and in manufacturing shall exclude expenditures related to manufacturing from total expenditures for the purpose of assessing whether 2/3 of expenditures are allocable to research and development. Receipts from research and development shall include receipts from the provision of research and development services and from royalties or fees derived from the licensing of patents, know-how or other technology developed from research and development. For purposes of this section, research and development is experimental or laboratory activity having as its ultimate goal the development of new products, the improvement of existing products, the development of new uses for existing products, the development or improvement of methods for producing products, and does not include testing or inspection for quality control purposes, efficiency surveys, management studies, consumer surveys or other market research, advertising or promotional activities, or research in connection with literacy, historical or similar projects.
Nothing in this section shall be construed to provide for an exemption from local taxation of the machinery of a corporation deemed to be a domestic research and development corporation which is not deemed to be a domestic manufacturing corporation.
SECTION 28. Section 38Q of chapter 63, of the General Laws, as appearing in the 2002 Official Edition, is hereby amended by striking out, in line 3, the words "within 5 years from the effective date of this section" and inserting in place thereof the following words:- on or before August 5, 2005.
SECTION 29. Said chapter 63 of the General Laws is hereby amended by striking out section 42B, as amended by section 29 of chapter 4 of the acts of 2003, and inserting in place thereof the following section:-
Section 42B. Every foreign limited liability company taxed as a corporation separate from its members for federal income tax purposes and every corporation, association or organization established, organized or chartered under laws other than those of the commonwealth, which has a usual place of business in the commonwealth, and is engaged in manufacturing therein, or engaged therein in research and development shall, for the purposes of this chapter, be deemed to be a foreign manufacturing corporation or a foreign research and development corporation. Every foreign manufacturing corporation shall be taxed in the same manner and shall have the same duties under this chapter and chapter 62C as other foreign corporations, except insofar as the determination of the excise under this chapter may be affected by reason of the exemption from local taxation of the machinery of a foreign manufacturing corporation. A foreign research and development corporation for the purposes of this section is one whose principal activity herein is research and development and which derives more than 2/3 of its receipts attributable to the commonwealth from the activity or incurs more than 2/3 of its expenditures attributable to the commonwealth allocable to the activity; provide however, that a corporation that qualifies as a foreign research and development corporation only by reason of its expenditures shall not be entitled to the credit provided in section 31A of chapter 63 by virtue of its qualification as a foreign research and development corporation. Corporations that are engaged in research and development and that conduct manufacturing activities shall exclude expenditures related to manufacturing from total expenditures for the purpose of assessing whether 2/3 of expenditures are allocable to research and development, whether or not the manufacturing activities of the corporation are substantial. Receipts from research and development shall include receipts from the provision of research and development services and from royalties or fees derived from the licensing of patents, know-how or other technology developed from research and development. For purposes of this section, research and development is experimental or laboratory activity having as its ultimate goal the development of new products, the improvement of existing products, the development of new uses for existing products, the development or improvement of methods for producing products; and does not include testing or inspection for quality control purposes, efficiency surveys, management studies, consumer surveys or other market research, advertising or promotional activities, or research in connection with literacy, historical or similar projects. Nothing in this section shall be construed to provide for an exemption from local taxation of the machinery of a corporation deemed to be a foreign research and development corporation which is not deemed to be a foreign manufacturing corporation.
SECTION 30. Chapter 75 of the General Laws is hereby amended by adding the following section:-
Section 45. (a) There shall be a Massachusetts Technology Transfer Center, hereinafter referred to as the center, at the University of Massachusetts, that shall facilitate the transfer of technology from the commonwealth's research institutions to the commonwealth's industries, for productive use by such industries.
(b) The center shall provide advice and assistance to public and private research institutions on strategies for technology transfer including, but not limited to, advice and assistance in the following areas:
(1) assessing the viability and value of developing technologies;
(2) defining and exploiting potential markets for such technologies;
(3) commercialization strategies;
(4) intellectual property issues, including licensing strategies; and
(5) business development.
(c) The board of trustees of the University of Massachusetts, in consultation with the director of business and technology, shall appoint an executive director of the center. The executive director shall devote his full time to the operation of the center and may be removed at the pleasure of the board of trustees. The executive director shall report annually to the department of business and technology on the number of technology transfer transactions or projects that have been consummated with the assistance of the center, the names and geographic locations of the recipient industries and the estimated number of new jobs created as a result of such transactions or projects.
(d) There shall be an advisory committee relative to the center consisting of the director of business and technology, or his designee, the director of science and technology within the department of business and technology and 7 members selected by the executive director of the center, with the approval of the board of trustees, 1 of whom shall be a representative from a technology industry, at least 1 such member shall be a representative from academia, at least 1 such member shall have experience in venture financing and at least 1 such member shall have experience in public administration. The appointed members of the committee may be removed by the executive director with or without cause, subject to the approval of the board of trustees, and shall serve without compensation, except that each member shall be entitled to reimbursement for actual and necessary expenses incurred in the performance of official duties. The advisory committee shall meet at least twice annually.
(e) There shall be a center for economic analysis and assessment within the McCormack Graduate School of Policy Studies' Center for State and Local Policy. The center shall analyze and study economic trends in the commonwealth and shall provide its analysis to elected officials. The center shall continuously research and inform elected officials on the following subject areas:
(1) effectiveness of the commonwealth's economic development incentive programs including, but not limited to, tax credits, loan and matching grant programs;
(2) job creation programs;
(3) tax policy;
(4) workforce training and development programs; and
(5) regional and national competitiveness of the state's economy.
The center shall work with existing research entities within the University of Massachusetts system and other public agencies to prepare timely analysis of the economy of the commonwealth and other economic indicators.
SECTION 31. Section 6 of chapter 136 of the General Laws, as appearing in the 2002 Official Edition, is hereby amended by striking out clause (52) and inserting in place thereof the following clause:-
(52) The retail sale of alcoholic beverages not to be drunk on the premises on Sundays by retail establishments licensed under section 15 of chapter 138; provided, however, that establishments operating under this clause shall compensate an employee, for work performed on a Sunday, at a rate of not less than one and one-half of the employee's regular rate; provided further, that a local governing board may limit the sale of alcoholic beverages to 6 days a week and choose which days retail establishments licensed under section 15 of chapter 138 may sell alcoholic beverages; and provided further, that no such sale shall occur unless such permit has been granted; and provided further, that such permit shall not allow such sale prior to the hour of twelve noon or on Christmas Day if Christmas occurs on a Sunday; provided, however, that establishments operating under this clause which employ more than 7 persons shall compensate all employees for work performed on a Sunday, at a rate of not less than one and one-half of the employee's regular rate. No employee shall be required to work on a Sunday and refusal to work on a Sunday shall not be grounds for discrimination, dismissal, discharge, deduction of hours or any other penalty.
SECTION 32. Chapter 138 of the General Laws is hereby amended by striking out section 33, as so appearing, and inserting in place thereof the following section:-
Section 33. (a) No licensee under section 15 shall sell or deliver alcoholic beverages, and no registered pharmacist acting under section 29 and no licensee under section 30A shall sell alcoholic beverages or alcohol without a physician's prescription, during polling hours on any day on which a state or municipal election, caucus or primary is held in a city or town in which such licensed place is conducted; provided that these restrictions shall not apply if the local licensing authority issues an order to that effect applicable alike to all licensees of every class subject to such restrictions. Except as provided in section 33A, no holder of a tavern license shall sell any alcoholic beverages on Sundays and no other licensee under section 12 shall sell any such beverages on Sundays between 1:00 a.m. and 12:00 noon and in any county other than Suffolk, no licensee under section 12 shall sell any such beverages on Christmas day, or on the day following when Christmas occurs on a Sunday, or on the last Monday in May, between 1:00 a.m. and 12:00 noon. In Suffolk county, no licensee under said section 12 shall sell alcoholic beverages on Christmas day or on the day following when Christmas occurs on a Sunday, or on the last Monday in May, between 2:00 a.m. and 12:00 noon. No registered pharmacist acting under section 29 and no licensee under section 30A shall sell alcoholic beverages or alcohol without a prescription on Sundays or legal holidays, no licensee under section 15 shall sell or deliver any alcoholic beverages on the last Monday in May, Thanksgiving day or Christmas day or on the day following when Christmas day occurs on a Sunday. No licensee under section 18 or 19 shall sell or deliver alcoholic beverages on a Sunday or on the last Monday in May, Thanksgiving day or Christmas day or on the day following when Christmas occurs on a Sunday; provided, however, that a licensee under section 19B may sell wine at retail by the bottle to consumers for consumption off the winery premises on Sundays and legal holidays; provided further, that a licensee under section 19C may sell malt beverages at retail by the bottle to consumers for consumption off the brewery premises on Sundays and legal holidays; provided further, that a licensee under section 19E may sell distilled products at retail by the bottle to consumers for consumption off the distillery premises on Sundays and legal holidays; provided further, that a licensee who is a natural person who observes Saturday as the Sabbath by closing his place of business from sundown Friday to sundown Saturday and who sells or delivers kosher meat or fish pursuant to clause (23) of section 6 of chapter 136, may sell or deliver kosher wine on Sundays if it has been labeled and certified as such. Notwithstanding chapter 136 or 140 to the contrary, the local licensing authorities may authorize a licensee under section 12, who is authorized to sell alcoholic beverages on Sundays between the hours of 12:00 midnight and 1:00 a.m. or 2:00 a.m., to allow dancing during that 1 or 2-hour period, as the case may be, in which he is so authorized to sell alcoholic beverages.
(b) Notwithstanding subsection (a), and clause (52) of section 136 of chapter 6, in a city or town that accepts this subsection, there shall be no retail sale of alcoholic beverages on Sundays.
(c) Notwithstanding the provisions of section 77 of chapter 138 a city or town that authorizes licensees under section 15 to conduct business on a Sunday as provided by clause 52 of section 6 of chapter 136 shall permit said licensee to cease the conduct of business on one day of the week.
SECTION 33. Section 1 of chapter 176D of the General Laws, as so appearing, is hereby amended by striking out paragraph (a) and inserting in place thereof the following paragraph:-
(a) "Person", any individual, corporation, association, partnership, reciprocal exchange, inter-insurer, Lloyds insurer, fraternal benefit society, operators of any medical service plan and hospital service plan as defined in chapters 176B, 176C, 176E and 176F, carriers and health maintenance organizations as defined in chapter 176G, insurers and sponsors of a legal services plan as defined in chapter 176H, any other legal entity or self insurer which is engaged in the business of insurance, including agents, brokers, and adjusters, the Massachusetts Insurers Insolvency Fund and any joint underwriting association established pursuant to law. For purposes of this chapter, operators of any such medical and hospital service plans and carriers and such health maintenance organizations shall be engaged in the business of insurance.
SECTION 34. Section 1 of chapter 176G of the General Laws, as so appearing, is hereby amended by inserting before the definition of "Carrier" the following definition:-
"Affiliate", an affiliate of, or person affiliated with, a specific person, is a person that directly, or indirectly through 1 or more intermediaries, controls, or is controlled by, or is under common control with, the person specified.
SECTION 35. Said section 1 of said chapter 176G, as so appearing, is hereby further amended by inserting after the definition of "Company" the following definition:-
"Control", including controlling, controlled by and under common control with, the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting securities, by contract other than a commercial contract for goods or non-management services, or otherwise, unless the power is the result of an official position with or corporate office held by the person. Control shall be presumed to exist if any person, directly or indirectly, owns, controls, holds with the power to vote, or holds proxies representing, 10 per cent or more of the voting securities of any other person. In the case of a person subject to chapter 180, control shall be presumed to exist if any other person shall, directly or indirectly, own, control or hold, more than 10 per cent of the aggregate rights in any membership class or shall, directly or indirectly, have the right to appoint or elect more than 10 per cent of the directors serving on the person's board of directors. Any of these aforementioned presumptions may be rebutted by a showing made in the manner provided with respect to insurers under subsection (k) of section 206C of chapter 175 that control does not exist in fact. The commissioner may determine, after furnishing all persons in interest notice and opportunity to be heard and making specific findings of fact to support such determination, that such control exists in fact, notwithstanding the absence of a presumption to that effect.
SECTION 36. Said section 1 of said chapter 176G, as so appearing, is hereby further amended by inserting after the definition of "Evidence of Coverage" the following definition:-
"Foreign health maintenance organization", a health maintenance organization formed by authority of any state or government other than the commonwealth and qualified to conduct business in the commonwealth.
SECTION 37. Said section 1 of said chapter 176G, as so appearing, is hereby further amended by inserting after the definition of "Health maintenance organization" the following definition:-
"Health maintenance organization holding company system", a health maintenance organization holding company system consists of 2 or more affiliates, 1 or more of which is a health maintenance organization.
SECTION 38. Said section 1 of said chapter 176G, as so appearing, is hereby further amended by striking out the definition of "Member" and inserting in place thereof the following 3 definitions:-
"Managed hospital payment basis", agreements wherein the financial risk is primarily related to the degree of utilization rather than to the cost of the services.
"Member", any individual who has entered into a health maintenance contract, or on whose behalf such an arrangement has been made, with a health maintenance organization or carrier or both for health services and any dependent of such individual who is covered by the same contract; provided that in sections 25 to 29, inclusive. "Enrolled member" shall mean any such individual, and "Member" shall have the same meaning as set forth in chapter 180.
"Net worth", the excess of total admitted assets over total liabilities, but the liabilities shall not include fully subordinated debt pursuant to subsection (d) of section 24.
SECTION 39. Said section 1 of said chapter 176G, as so appearing, is hereby further amended by adding the following 4 definitions:-
"Person", shall have the meaning set forth in section 206 of chapter 175.
"Subsidiary", shall have the meaning set forth in section 206 of chapter 175.
"Uncovered expenditures", the cost to a health maintenance organization for health care services that are the obligation of such a health maintenance organization, for which an enrollee may also be liable in the event of the health maintenance organizations' insolvency and for which no alternative arrangements have been made to cover such costs that are acceptable to the commissioner.
"Voting security", shall have the meaning set forth in section 206 of chapter 175.
SECTION 40. Section 3 of said chapter 176G, as so appearing, is hereby amended by striking out, clause (1) and inserting in place thereof the following clause:-
(1) organize and operate a health maintenance organization as a line of business, division, department, subsidiary or affiliate under the provisions of this chapter provided that where such is organized as a line of business, division, department, subsidiary or affiliate, the operation of the health maintenance organization shall be separately accounted for, the income and expenses shall be allocated in accordance with statutory accounting practices and procedures prescribed or permitted by the commissioner, and the carrier or companies shall not utilize the income from such health maintenance organization for unrelated activities.
SECTION 41. Said chapter 176G is hereby further amended by striking out section 10, as so appearing, and inserting in place thereof the following section:-
Section 10. Every health maintenance organization shall annually file with the commissioner, within 60 days of the close of its fiscal year, a report verified by at least 2 principal officers and covering its preceding fiscal year; provided that, if the commissioner determines that a threat of insolvency exists with respect to a health maintenance organization, he may require that such report be made available prior to the expiration of said 60 days. The report shall include:-
(1) financial statements of the health maintenance organization on the latest applicable form of annual statement approved by the National Association of Insurance Commissioners for health maintenance organizations, with any additional information the commissioner may require for the purpose of eliciting a complete and accurate exhibit of the condition and transactions of the health maintenance organization;
(2) statistics relating to the cost of operations and the pattern of utilization of services in the previous fiscal year; and
(3) such other information as the commissioner may reasonably require relating to the past performance of the organization.
All financial information reflected in the annual report shall be maintained and prepared in accordance with statutory accounting practices and procedures prescribed or permitted by the commissioner.
The commissioner shall require that the annual report be maintained and prepared in accordance with the Annual Statement Instructions and Accounting Practices and Procedures Manual adopted by the National Association of Insurance Commissioners unless further modified by the commissioner as deemed appropriate.
The commissioner may make an examination of the affairs of a health maintenance organization when the commissioner deems prudent but, in any event, not less frequently than once every 5 years. Health maintenance organizations shall be examined in all respects as companies subject to and pursuant to section 4 of chapter 175.
Notwithstanding any other provisions of the General Laws, including clause Twenty-sixth of section 7 of chapter 4, chapter 66, or section 4 of chapter 175, the records of any such audit, examination or other inspection and the information contained in the records, reports or books of a health maintenance organization examined pursuant to this section shall be confidential and open only to the inspection of the commissioner, his examiners and assistants. Access to the confidential material may be granted by the commissioner to the National Association of Insurance Commissioners, to the insurance department of any other state or country or to law enforcement officials of the commonwealth or any other state or agency of the federal government at any time, so long as the agency or office receiving the information agrees in writing to hold the material confidential. Nothing in this section shall be construed to prohibit the required production of such records, and information contained in the reports of such health maintenance organization, before any court of the commonwealth or any master or auditor appointed by any such court, in any criminal or civil proceeding, affecting such health maintenance organization, its officers, directors or employees.
The final report of any such audit, examination or other inspection by or on behalf of the division shall be a public record.
SECTION 42. Section 14 of said chapter 176G, as so appearing, is hereby amended by striking out the first sentence and inserting in place thereof the following 2 sentences:- Each applicant for a health maintenance organization license shall upon initial application submit to the commissioner for his approval such materials as the commissioner shall by regulation require, in a form approved by the commissioner. A health maintenance organization shall annually notify the commissioner of any material change to the information submitted, in a form and at a time approved by the commissioner.
SECTION 43. Section 20 of said chapter 176G, as so appearing, is hereby amended by inserting, after the figure "175", in line 6, the following words:- , and sections 20A and 29 of chapter 176G.
SECTION 44. Said section 20 of said chapter 176G, as so appearing, is hereby further amended by striking out, in lines 7 to 18, inclusive, the words ", the following: the health maintenance organization is insolvent or in unsound financial condition, the health maintenance organization's business policies or methods are unsound or improper, the health maintenance organization's condition or management is such as to render its further transaction of business hazardous to the public or to its members or creditors, the health maintenance organization is transacting business fraudulently, the health maintenance organization or its officers or agents have refused to submit an examination under section 10, the health maintenance organization has attempted or is attempting to compromise with its creditors on the ground that it is financially unable to pay its claims in full or the health maintenance organization has inadequately reserved for unearned premiums." and inserting in place thereof the following words: any ground identified in section 20A and in chapter 175J.
SECTION 45. Said chapter 176G is hereby amended by inserting after section 20, as so appearing, the following section:-
Section 20A. If the commissioner is satisfied, upon examination or other evidence submitted to him, that (1) any health maintenance organization is insolvent or is in an unsound financial condition, (2) its business policies or methods are unsound or improper, (3) its condition or management is such as to render its further transaction of business hazardous to the public or its members or creditors, (4) it is transacting business fraudulently, (5) the health maintenance organization or its officers or agents have refused to submit to an examination under section 10 or to perform any legal obligation relative thereto, (6) the amount of its funds, net cash or contingent assets is deficient, (7) the health maintenance organization has attempted or is attempting to compromise with its creditors on the ground that it is financially unable to pay its claims in full, or (8) the health maintenance organization has inadequately reserved for unearned premiums, he may seek administrative supervision, rehabilitation or liquidation pursuant to section 20 or revoke or suspend the license issued to the health maintenance organization under section 14 for a period not exceeding the unexpired terms thereof.
In the case of revocation or suspension, the commissioner shall give written notice to the company specifying the date on which such revocation or suspension shall be effective, the term of any such suspension and the ground for such revocation or suspension; provided, that if the ground for revocation or suspension is that the health maintenance organization has violated any provision of law or has failed to comply with its charter, the effective date of such revocation or suspension shall be not less than 10 days from the date of issue of the notice, and the particulars of such violation or failure to comply with its charter shall be specified in said notice. Such notice may be served by registered mail, sent postage prepaid, addressed to the health maintenance organization at its last home office address or to the last known address of the resident agent. An affidavit of the commissioner, in such form as he may prescribe, or of anyone authorized by him to give such notice, appended to a copy thereof, that such notice has been mailed as aforesaid shall be prima facie evidence that such notice has been duly given. He shall also cause notice of such revocation or suspension to be published in such manner as he may deem necessary for the protection of the public. A health maintenance organization aggrieved by a revocation or suspension of its license under this section, may within 10 days from the effective date of such revocation or suspension file a petition in the supreme judicial court for the county of Suffolk for a review of such action of the commissioner. The court shall summarily hear and determine the question whether the ground for revocation or suspension specified in the notice of the commissioner exists and may make any appropriate order or decree. If the order or decree is adverse to the petitioning health maintenance organization it may within 10 days therefrom appeal to the full court and in case of such an appeal the revocation or suspension of the license of the health maintenance organization shall continue in full force until the final determination of the question by the full court, unless vacated by the commissioner during the pendency of such appeal.
SECTION 46. Said chapter 176G is hereby further amended by adding the following 5 sections:-
Section 25. (a) The commissioner shall require upon issuance of an initial license under this chapter that a health maintenance organization shall have an initial adjusted net worth of $1,500,000.
(b) Except as provided by subsection (c) or (d), the commissioner shall require that the adjusted net worth of a health maintenance organization be maintained subsequent to initial licensure in an amount equal to the greater of the following amounts:
(1) $1,000,000; or
(2) 2 per cent of annual premium revenues as reported on the most recent annual financial statement filed with the commissioner on the first $150,000,000 of premium and 1 per cent of annual premium on the premium in excess of $150,000,000; or
(3) An amount equal to the sum of 3 months uncovered health care expenditures as reported on the most recent financial statement filed with the commissioner; or
(4) An amount equal to the sum of:
(i) 8 per cent of annual health care expenditures except those paid on a capitated basis or managed hospital payment basis as reported on the most recent financial statement filed with the commissioner; and
(ii) 4 per cent of annual hospital expenditures paid on a managed hospital payment basis as reported on the most recent financial statement filed with the commissioner.
(c) A health maintenance organization licensed before January 1, 2004 must maintain a minimum adjusted net worth of:
(1) 10 per cent of the amount required by subsection (b) by December 31, 2004;
(2) 25 per cent of the amount required by subsection (b) by December 31, 2005;
(3) 40 per cent of the amount required by subsection (b) by December 31, 2006;
(4) 55 per cent of the amount required by subsection (b) by December 31, 2007;
(5) 70 per cent of the amount required by subsection (b) by December 31, 2008;
(6) 85 per cent of the amount required by subsection (b) by December 31, 2009; and
(7) 100 per cent of the amount required by subsection (b) by December 31, 2010.
(d) In determining adjusted net worth, no debt shall be considered fully subordinated unless the subordination clause is in a form acceptable to the commissioner, which shall at a minimum meet the following requirements:
(1) The effective date, amount, interest and parties involved in such debt are clearly set forth;
(2) The principal sum and any interest accrued thereon are subject to and subordinate to all other liabilities of the health maintenance organization, and upon dissolution or liquidation, no payment of any kind shall be made until all other liabilities of the health maintenance organization have been paid;
(3) The instrument states that the parties agree that the health maintenance organization must obtain written approval from the commissioner prior to any payment of interest or repayment of principal; and
(4) The debt is deemed fully subordinated by the commissioner in his discretion.
(e) Any debt incurred by a note meeting the requirements of subsection (d) shall not be considered a liability and shall be recorded as equity.
(f) The commissioner may adopt rules, regulations and guidelines, from time to time, requiring any health maintenance organization incorporated, licensed, approved or authorized to engage in business pursuant to this chapter to possess and constantly maintain capital and surplus levels in excess of the statutory levels required by this chapter based upon any of the following factors:
(1) the nature and type of health maintenance contracts that a health maintenance organization provides, arranges for or otherwise participates in, the nature and type of such contracts in effect in the overall health maintenance organization market in the commonwealth, and the capability of the health maintenance organization to provide protection against loss of prepaid fees or other revenues or unavailability of covered health services or from other financial impairment of its obligations to its members;
(2) the volume of contract premiums or fees relative to health maintenance contracts that a health maintenance organization provides, arranges for or otherwise participates in;
(3) the composition, quality, duration or liquidity of a health maintenance organization's investment portfolio;
(4) fluctuations in the market value of securities or other assets a health maintenance organization holds;
(5) the adequacy of a health maintenance organization's reserves; or
(6) the size of a health maintenance organization's asset valuation reserves and interest maintenance reserves.
The rules, regulations or guidelines adopted under this section shall be designed to assure the financial solvency of health maintenance organizations for the protection of policyholders, enrolled members, shareholders and the general public. The commissioner may establish, by rule, regulation or guideline, a procedure that shall require a health maintenance organization to increase its capital and surplus amounts over a specified period of time until the required statutory minimums established by this chapter, or higher levels as ordered by the commissioner, are met.
Section 26. (a) Except as provided in subsections (b) and (d), each health maintenance organization shall maintain a deposit with a trustee acceptable to the commissioner through which a custodial or controlled account is utilized of cash, securities or any combination of these or other measures that are acceptable to him, which is to be used exclusively to protect the interests of policyholders, enrolled members, and the general public and which at all times shall have a value of not less than $1,000,000.
(b) Each health maintenance organization approved by the commissioner before January 1, 2004 shall provide evidence of and maintain at all times a deposit as described in subsection (a) in the amount of $500,000 not later than July 1, 2004. Not later than January 1, 2005, the health maintenance organization shall provide evidence of and maintain a deposit in the amount of an additional $500,000 to constitute the required $1,000,000 deposit.
(c) All income from the deposit shall be an asset of the health maintenance organization. A health maintenance organization that has made a securities deposit may withdraw that deposit or any part thereof after making a substitute deposit of cash, securities or any combination of these or other measures of equal amount and value. The commissioner shall approve any securities before they are deposited or substituted.
(d) The commissioner may reduce or eliminate the deposit requirement if the health maintenance organization deposits with the state treasurer, insurance commissioner or other official body of the state or jurisdiction of domicile, for the protection of policyholders, enrolled members and subscribers of such health maintenance organization and the general public, cash, acceptable securities or surety, and delivers to the commissioner a certificate to such effect, duly authenticated by the appropriate entity holding the deposit.
(e) If in the opinion of the commissioner the deposit requirement as established above would be inadequate to protect the interests of enrolled members, the deposit shall be appropriately adjusted in order to protect the interests of policyholders, enrolled members and subscribers of the health maintenance organization and the general public.
(f) The deposit shall be an admitted asset of the health maintenance organization in the determination of net worth pursuant to section 25. The commissioner may use the deposit for administrative costs directly attributable to any receivership, administrative supervision, rehabilitation or liquidation pursuant to section 20. If the health maintenance organization is ordered into receivership, administrative supervision, rehabilitation or liquidation, the deposit shall be an asset subject to the provisions of section 20.
Section 27. (a) No person other than the health maintenance organization shall make a tender offer for or a request or invitation for tenders of, or enter into any agreement to exchange securities, or seek to acquire, or acquire, in the open market or otherwise, any voting security of, any membership rights in, or any right to appoint or elect members of the board of directors of a domestic health maintenance organization if, after the consummation thereof, such person would, directly or indirectly, or by conversion or by exercise of any right to acquire, be in control of such health maintenance organization. A person shall not enter into an agreement to merge with or otherwise to acquire control of a domestic health maintenance organization or any person controlling a domestic health maintenance organization unless, at the time any such offer, request or invitation is made or any such agreement is entered into, or prior to the acquisition of such securities, membership rights, or board of directors appointment or election rights, if no offer or agreement is involved, such person has filed with the commissioner and has sent to such health maintenance organization, a statement containing the information required by this section, and such offer, request, invitation, agreement or acquisition has been approved by the commissioner in the manner hereinafter described. For purposes of this section a domestic health maintenance organization shall include any person controlling a domestic health maintenance organization. For the purposes of this section, a person shall not include any securities broker holding, in the usual and customary broker's function, less than 10 per cent of the voting securities, membership rights, or board of directors appointment or election rights, of a domestic health maintenance organization or of any person which controls a domestic health maintenance organization.
(b) The statement to be filed with the commissioner pursuant to subsection (a) shall be made under oath or affirmation and shall contain the following information:
(1) The name and address of each person by whom or on whose behalf the merger or other acquisition of control referred to in subsection (a) is to be effected, hereinafter called the acquiring party, and (i) if such person is an individual, his principal occupation and all offices and positions held during the past 5 years, and any convictions of crimes other than minor traffic violations during the past 10 years; (ii) if such person is not an individual, a report of the nature of its business operations during the past 5 years or for such lesser period as such person and any predecessors thereof shall have been in existence; an informative description of the business intended to be done by such person and such person's subsidiaries; and a list of all individuals who are or who have been selected to become directors or executive officers of such person, or who perform or will perform functions appropriate to such positions. Such list shall include for each such individual the information required by this subparagraph.
(2) The source, nature and amount of the consideration used or to be used in effecting the merger or other acquisition of control, a description of any transaction wherein funds were or are to be obtained for any such purpose, including any pledge of the health maintenance organization's stock or assets, or the stock or assets of any of its subsidiaries, or controlling affiliates, and the identity of persons furnishing such consideration; provided, however, that where the source of such consideration is a loan made in the lender's ordinary course of business, the identity of the lender shall remain confidential, if the person filing such statement so requests.
(3) Fully audited financial information as to the earnings and financial condition of each acquiring party for the preceding 5 fiscal years of each such acquiring party or for such lesser period as such acquiring party and any predecessors thereof shall have been in existence, and similar unaudited information as of a date not earlier than 90 days prior to the filing of the statement.
(4) Any plans or proposals which each acquiring party may have to liquidate such health maintenance organization, to sell its assets or merge or consolidate it with any person, or to make any other material change in its business or corporate structure or management. A person who omits from the statement filed hereunder any plans or proposals that should have been included pursuant to this subsection, and shall be granted approval for a change of control without the disclosure of the plans or proposals, shall be prohibited for a period of 2 years from the date of the approval from engaging in or taking any steps preparatory to engaging in any transaction described or referenced in or contemplated by the plans or proposals except with the specific approval of the commissioner.
(5) The number of any shares of any security, or the extent of any membership rights, or board of directors appointment or election rights, as the case may be, referred to in subsection (a) which each acquiring party proposes to acquire, and the terms of the offer, request, invitation, agreement or acquisition referred to in said subsection (a), and a statement as to the method by which the fairness of the proposal was arrived at.
(6) The amount of each class of any security, membership right, board of directors appointment or election rights referred to in said subsection (a), as the case may be, which is beneficially owned or concerning which there is a right to acquire beneficial ownership by each acquiring party.
(7) A full description of any contracts, arrangements or understandings with respect to any security, membership right, board of directors appointment or election rights, as the case may be, referred to in said subsection (a) in which any acquiring party is involved, including but not limited to transfer of any of the securities, joint ventures, loan or option arrangements, put or calls, guarantees of loans, guarantees against loss or guarantees of profits, division of losses or profits or the giving or withholding of proxies. The description shall identify the persons with whom such contracts, arrangements or understandings have been entered into.
(8) A description of the purchase of any security, membership right, board of directors appointment or election rights, as the case may be, referred to in said subsection (a) during the 12 calendar months preceding the filing of the statement, by the acquiring party, including the dates of purchase, names of the purchasers and consideration paid or agreed to be paid therefore.
(9) A description of any recommendations to purchase any security, membership right, board of directors appointment or election rights, as the case may be, referred to in said subsection (a) made during the 12 calendar months preceding the filing of the statement, by any acquiring party, or by anyone based on interviews or at the suggestion of such acquiring party.
(10) Copies of all tender offers for, requests, or invitations for tenders of, exchange offers for, and agreements to acquire or exchange any securities, membership rights, board of directors appointment or election rights, as the case may be, referred to in said subsection (a), and, if distributed, of additional soliciting material relating thereto.
(11) The term of any agreement, contract or understanding made with or proposed to be made with any broker-dealer as to solicitation of securities, membership rights, board of directors appointment or election rights, as the case may be, referred to in said subsection (a) for tender or the like, and the amount of any fees, commissions or other compensation to be paid to broker-dealers with regard thereto.
(12) Such additional information as the commissioner may by rule or regulation prescribe as necessary or appropriate for the protection of enrolled members, policyholders, stockholders and members of the health maintenance organization or in the public interest.
If the person required to file the statement pursuant to subsection (a) is a partnership, limited partnership, limited liability company, syndicate or other group, the commissioner may require that the information required by subparagraphs (1) to (12), inclusive, shall be given with respect to each partner of such partnership or limited partnership, each member or manager of such limited liability company, each member of such syndicate or group and each person who controls such partner, member or manager. If any such partner, member, manager or person is a corporation or the person required to file the statement referred to in said subsection (a) is a corporation, the commissioner may require that the information called for by said subparagraphs (1) to (12), inclusive, shall be given with respect to such corporation, each officer and director of such corporation and each person who is directly or indirectly the beneficial owner of more than ten percent of the outstanding voting securities of such corporation. If any material change occurs in the facts set forth in the statement filed with the commissioner and sent to such health maintenance organization pursuant to this section, an amendment setting forth such change, together with copies of all documents and other material relevant to such change, shall be filed with the commissioner and sent to such health maintenance organization within two business days after the person learns of such change.
(c) If any offer, request, invitation, agreement or acquisition referred to in subsection (a) is proposed to be made by means of a registration statement under the Securities Act of 1933, 5 U.S.C. section 77, et seq., or in circumstances requiring the disclosure of similar information under the Securities Act of 1934, 15 U.S.C. sections 78a to 78k, inclusive, or under a law of any state requiring similar registration or disclosure, the person required to file the statement referred to in said subsection (a) may utilize such documents in furnishing the information called for by that statement.
(d)(1) The commissioner shall approve any merger or other acquisition of control referred to in subsection (a) unless, after a public hearing on the merger or other acquisition, he finds that:
(i) after the change of control, the domestic health maintenance organization referred to in said subsection (a) would not be able to satisfy such requirements as the commissioner may, by rule or regulation, establish for an organization seeking approval as a health maintenance organization under this chapter;
(ii) the effect of the merger or other acquisition of control would be substantially to lessen competition in the health care insurance market in this commonwealth or tend to create a monopoly in the commonwealth;
(iii) the financial condition of any acquiring party is such as might jeopardize the financial stability of the health maintenance organization, or prejudice the interests of its subscribers, policyholders or enrolled members;
(iv) the terms of the offer, request, invitation, agreement or acquisition referred to in said subsection (a) are unfair and unreasonable to the subscribers, policyholders or enrolled members of the health maintenance organization;
(v) the plans or proposals which the acquiring party has to liquidate the health maintenance organization, sell its assets or any seat on its board of directors, or consolidate or merge it with any person, or to make any other material change in its business or corporate structure or management, are unfair and unreasonable to the subscribers, policyholders or enrolled members of the health maintenance organization and not in the public interest;
(vi) the competence, experience and integrity of those persons who would control the operation of the health maintenance organization are such that it would not be in the interest of the subscribers, policyholders or enrolled members of the health maintenance organization or of the public to permit the merger or other acquisition of control; or
(vii) the acquisition is likely to be hazardous or prejudicial to the health insurance buying public or to the actual enrollees under health insurance plans in the commonwealth.
(2) The public hearing referred to in subparagraph (1) of subsection (d) shall be held within 30 days after the statement required by subsection (a) is filed, and at least 20 days notice thereof shall be given by the commissioner to the person filing the statement. The person filing the statement shall give not less than 7 days notice of such public hearing to the health maintenance organization and to such other persons as the commissioner may designate. The commissioner shall make a determination within 30 days after the conclusion of such hearing. At the hearing, the person filing the statement, the health maintenance organization, any person to whom notice of hearing was sent, and any other person whose interest may be affected thereby, shall have the right to present evidence, examine and cross-examine witnesses, offer oral or written arguments in connection therewith, and shall be entitled to conduct discovery proceedings in the same manner as is presently allowed in the superior court department of the trial court. All discovery proceedings shall be concluded not later than 3 days before the commencement of the public hearing.
(3) The commissioner may retain at the acquiring party's expense any attorneys, actuaries, accountants and other experts not otherwise a part of the commissioner's staff as may be reasonably necessary to assist the commissioner in reviewing the proposed acquisition of control.
(4) The commissioner may condition the approval of the merger or other acquisition on the removal of the basis of disapproval within a specified period of time.
(e) This section shall not apply to any offer, request, invitation, agreement or acquisition that the commissioner by order shall exempt from this section as:
(1) not having been made or entered into for the purpose, and not having the effect, of changing or influencing the control of a domestic health maintenance organization, or
(2) otherwise not comprehended within the purposes of this section.
(f) The following shall be violations of this section:
(1) The failure to file any statement, amendment or other material required to be filed pursuant to subsection (a) or (b); or
(2) The effectuation or any attempt to effectuate an acquisition of control of, or merger with, a domestic health maintenance organization unless the commissioner has given his approval thereto.
(g) The courts of the commonwealth shall be vested with jurisdiction over any person not resident, domiciled or authorized to do business in the commonwealth who files a statement with the commissioner under this section and over all actions involving such person arising out of violations of this section, and each such person shall be deemed to have performed acts equivalent to and constituting an appointment by such a person of the commissioner to be his true and lawful attorney upon whom may be served all lawful process in any action, suit or proceeding arising out of violations of this section. Copies of all such lawful process shall be served on the commissioner and transmitted by registered or certified mail by the commissioner to such person at his last known address.
(h) Nothing in this section shall be construed to relieve any health maintenance organization or any person acquiring control of a health maintenance organization of any obligation arising on their part under chapter 180 with respect to any transaction contemplated under this section; and to the extent that any transaction contemplated under this section requires the approval, consent or endorsement of the attorney general pursuant to chapter 180, or otherwise, such approval, consent or endorsement shall first be obtained in writing from the attorney general prior to the filing of the statement required by subsection (b), and such written approval, consent or endorsement shall be filed with the commissioner along with the statement required by subsection (b).
Section 28. (a) Every health maintenance organization which may do business in the commonwealth and which is a member of a health maintenance organization holding company system, shall register with the commissioner. Notwithstanding the foregoing, a foreign health maintenance organization shall not be required to register with the commissioner if the foreign health maintenance organization is subject to registration requirements and standards adopted by statute or regulation in the jurisdiction of its domicile which are substantially similar to those contained in subsection (a) to subsection (m), inclusive, subsection (q) and subsection (s). Any health maintenance organization which is subject to registration under this section shall register within 15 days after it becomes subject to registration, or 180 days after the effective date of this section, whichever is later, and annually thereafter for the previous calendar year, unless the commissioner for good cause shown extends the time for registration, and then within such extended time. The commissioner may require any foreign health maintenance organization authorized to do business in the commonwealth that is a member of a health maintenance organization holding company system and that is not subject to registration under this section to furnish a copy of the registration statement, the summary specified in subsection (c), or other information filed by such health maintenance organization with the insurance regulatory authority of the jurisdiction of its domicile.
(b) Every health maintenance organization subject to registration shall file the registration statement on a form prescribed by the commissioner, which shall contain the following current information:
(1) any material change to the information submitted pursuant to section 14;
(2) the identity and relationship of every member of the health maintenance organization holding company system;
(3) the following agreements in force, and transactions currently outstanding or which have occurred during the last calendar year between such health maintenance organization and any affiliates:
(i) loans, other investments, or purchases, sales or exchanges of securities of any affiliates by the health maintenance organization or of the health maintenance organization by its affiliates;
(ii) purchases, sales or exchange of assets;
(iii) transactions not in the ordinary course of business;
(iv) guarantees or undertakings for the benefit of an affiliate which result in an actual or contingent exposure of the health maintenance organization's assets to liability, other than health maintenance contracts entered into in the ordinary course of the health maintenance organization's business;
(v) all management agreements, service contracts and cost-sharing arrangements; but, all records and information regarding contracts entered into with providers disclosed under this clause shall be confidential and open only to the inspection of the commissioner, his examiners and assistants. Nothing herein shall be construed to prohibit the required production of the records, and information contained in the reports of the health maintenance organization, before a court of the commonwealth or a master or auditor appointed by the court, in a criminal or civil proceeding, affecting the health maintenance organization, its officers, directors or employees;
(vi) reinsurance agreements;
(vii) dividends and other distributions to shareholders or members; and
(viii) consolidated tax allocation agreements;
(4) any pledge of the health maintenance organization's stock or assets, including stock or assets of any subsidiary or controlling affiliate, for a loan made to any member of a health maintenance organization holding company system; and
(5) other matters concerning transactions between the health maintenance organization and any affiliates as may be included from time to time in any registration forms adopted or approved by the commissioner.
(c) All registration statements shall contain a summary outlining all items in the current registration statement representing changes from the prior registration statement.
(d) No information need be disclosed on the registration statement filed pursuant to subsection (b) if such information is not material for the purposes of this section. Unless the commissioner by rule, regulation or order provides otherwise, sales, purchases, exchanges, loans or extensions of credit, investments or guarantees or any transaction involving one-half of one percent or less of a health maintenance organization's admitted assets as of the next preceding December 31 shall not be deemed material for purposes of this section.
(e) Subject to subsection (q), each domestic health maintenance organization shall report to the commissioner all dividends and other distributions to its shareholders or members within 5 business days following the declaration thereof, and at least 10 business days, commencing from the date of receipt by the commissioner, prior to the payment thereof. No domestic health maintenance organization shall pay any dividend or make any distribution to its shareholders or members from other than unassigned funds unless the commissioner shall have approved such dividend or distribution. For purposes of this section, the term "unassigned funds" shall have the same meaning as that term is used in the latest applicable form approved by the National Association of Insurance Commissioners.
(f) Any person within a health maintenance organization holding company system subject to registration shall be required to provide complete and accurate information to a health maintenance organization, where such information is reasonably necessary to enable the health maintenance organization to comply with sections 27 to 29, inclusive.
(g) The commissioner may require or allow 2 or more affiliated health maintenance organizations subject to registration hereunder to file a consolidated registration statement.
(h) The commissioner may allow a health maintenance organization that is authorized to do business in the commonwealth and that is part of a health maintenance organization holding company system to register on behalf of any affiliated health maintenance organization that is required to register under subsection (a) and to file all information and material required to be filed under this section.
(i) This section shall not apply to any health maintenance organization, information or transaction if and to the extent that the commissioner by rule, regulation or order shall exempt the same from the provisions of this section.
(j) Any person that has in the past filed a registration statement indicating affiliation with any other health maintenance organization or membership in a health maintenance organization holding company system may file with the commissioner a disclaimer of affiliation with any authorized health maintenance organization or such a disclaimer may be filed by such health maintenance organization or any member of a health maintenance organization holding company system. The disclaimer shall fully disclose all material relationships and bases for affiliation between such person and such health maintenance organization as well as the basis for disclaiming such affiliation. After a disclaimer has been filed, the health maintenance organization shall not be relieved of any duty to register or report under this section which may arise out of the health maintenance organization's relationship with such person unless and until the commissioner allows such a disclaimer. The commissioner shall disallow such a disclaimer only after furnishing all parties in interest with notice and opportunity to be heard and after making specific findings of fact to support such disallowance.
(k) The failure to file a registration statement or any summary of the registration statement thereto required by this section within the time specified for such filing shall be a violation of this section.
(l) Transactions within a health maintenance organization holding company system to which a health maintenance organization subject to registration is a party shall be subject to the standards specified by the commissioner by rule, regulation or order, including the following:
(1) the terms shall be fair and reasonable;
(2) charges or fees for services performed shall be reasonable;
(3) expenses incurred and payment received shall be allocated to the health maintenance organization in conformity with section 10;
(4) the books, accounts and records of each party to all such transactions shall be so maintained as to clearly and accurately disclose the nature and details of the transactions including such accounting information as is necessary to support the reasonableness of the charges or fees to the respective parties; and
(5) the health maintenance organization's net worth following any dividends or distributions to affiliates shall be reasonable in relation to the health maintenance organization's outstanding liabilities, adequate to its financial needs, and otherwise in conformance with the provisions of this chapter.
(m) The following transactions involving a domestic health maintenance organization and any person in its holding company system may not be entered into unless the health maintenance organization has notified the commissioner in writing of its intention to enter into any such transaction at least 30 days prior thereto, or such shorter period as the commissioner may permit, and the commissioner has not disapproved it within such period.
(1) sales, purchases, exchanges, loans or extensions of credit, guarantees, or investments provided such transactions are equal to or exceed the lesser of 3 per cent of the health maintenance organization's admitted assets or 25 per cent of net worth as of the next preceding December 31;
(2) loans or extensions of credit to any person who is not an affiliate, where the health maintenance organization makes such loans or extensions of credit with the agreement or understanding that the proceeds of such transactions, in whole or in substantial part, are to be used to make loans or extensions of credit to, to purchase assets of, or to make investments in, any affiliate of the health maintenance organization making such loans or extensions of credit provided such transactions are equal to or exceed the lesser of 3 per cent of the health maintenance organization's admitted assets or 25 per cent of net worth as of the next preceding December 31;
(3) reinsurance agreements or modifications to the agreements in which the reinsurance premium or a change in the health maintenance organization's liabilities equals or exceeds the lesser of 3 per cent of the health maintenance organization's admitted assets or 25 per cent of net worth as of the next preceding December 31, including those agreements which may require as consideration the transfer of assets from a health maintenance organization to a non-affiliate, if an agreement or understanding exists between the health maintenance organization and non-affiliate that any portion of such assets will be transferred to one or more affiliates of the health maintenance organization;
(4) all management agreements, service contracts, all cost-sharing arrangements which are not based on statutory accounting principles and all cost-sharing arrangements which would be reportable as transactions on the health maintenance organization's annual report under section 10. The commissioner may exempt from the requirements of this subsection any management agreement, service contract or cost-sharing arrangement; and
(5) any transactions, specified by regulation, which the commissioner determines may adversely affect the interests of the health maintenance organization's policyholders or enrolled members.
Notification shall be provided to the commissioner for transactions in clauses (1) to (5), inclusive, which increase or decrease the health maintenance organization's net worth as of the next preceding December 31 by 5 per cent or more. The notification shall accompany the next quarterly financial statement filing. Nothing in this section shall authorize or permit any transactions which would otherwise be contrary to law, or to relieve any health maintenance organization or other person of any obligation arising under chapter 180.
(n) A domestic health maintenance organization may not enter into transactions that are part of a plan or series of like transactions with persons within the holding company system if the purpose of those separate transactions is to avoid the statutory threshold amount and thus avoid the review that would occur otherwise. If the commissioner determines that such separate transactions were entered into over any 12-month period for the purpose of avoiding the statutory threshold amount, he may exercise his authority under subsection (b) of section 29.
(o) The commissioner, in reviewing transactions pursuant to subsections (1) and (m), shall consider whether the transactions comply with the standards set forth in subsection (1) and whether they may adversely affect the interests of policyholders or enrolled members.
(p) The commissioner shall be notified within 30 days of any investment of the domestic health maintenance organization in any one corporation if the total investment in such corporation by the health maintenance organization holding company system of which the health maintenance organization is a member exceeds ten percent of such corporation's voting securities or ownership interest.
(q) No domestic health maintenance organization shall pay any extraordinary dividend or make any other extraordinary distributions to its shareholders, members or officers until 30 days after the commissioner receives notice of the declaration thereof and has not within such period disapproved such payment, or the commissioner approves such payment. For purposes of this section, an extraordinary dividend or distribution includes any dividend or distribution of cash or other property, whose fair market value together with other dividends or distributions made within the preceding 12 months exceeds the greater of (i) 10 per cent of such health maintenance organization's net worth as of the next preceding December 31, or (ii) the net income of the health maintenance organization for the 12-month period ending the next preceding December 31.
Notwithstanding any other general law to the contrary, a health maintenance organization may declare an extraordinary dividend or distribution which is conditional on the commissioner's approval thereof, and such a declaration shall confer no rights upon any person until the commissioner has approved the payment of such dividend or distribution or the commissioner has not disapproved such payment within the 30 day period set by this subsection.
(r)(1) Notwithstanding the control of a domestic health maintenance organization by any person, the officers and directors of the health maintenance organization shall not thereby be relieved of any obligation or liability to which they would otherwise be subject by law, and the health maintenance organization shall be managed so as to assure its separate operating identity consistent with this chapter, and other applicable law.
(2) Nothing herein shall preclude a domestic health maintenance organization from having or sharing a common management or cooperative or joint use of personnel, property or services with one or more other persons under arrangements meeting the standards of subsection (1).
(s) For purposes of sections 27 to 29, inclusive, in determining whether a health maintenance organization's net worth is reasonable in relation to the health maintenance organization's outstanding liabilities and adequate to its financial needs, the following factors, among others, shall be considered:
(1) the size of the health maintenance organization as measured by its assets, capital and net worth, reserves, premium writings, insurance in force and other appropriate criteria;
(2) the nature and extent of the health maintenance organization's reinsurance program;
(3) the quality, diversification and liquidity of the health maintenance organization's investment portfolio;
(4) the recent past and projected future trend in the size of the health maintenance organization's investment portfolio and net worth;
(5) the net worth maintained by other comparable health maintenance organizations;
(6) the adequacy of the health maintenance organization's reserves;
(7) the quality and liquidity of investments of the health maintenance organization and any members of its holding company system. The commissioner may treat any such investment as a disallowed asset for purposes of determining the adequacy of net worth whenever in his judgment such investment so warrants;
(8) the quality of the health maintenance organization's earnings and the extent to which the reported earnings include extraordinary items;
(9) the extent to which the insurer's business is diversified among the several lines of insurance; and
(10) the number and size of risks insured in each line of business.
(t)(1) Subject to the limitation contained in this section and in addition to the powers conferred upon the commissioner by section 10 relating to the examination of health maintenance organizations, the commissioner shall also have the power to order any health maintenance organization approved under this chapter to produce such records, books, or other information papers in the possession of the health maintenance organization or its affiliates as are reasonably necessary to ascertain the financial condition of such health maintenance organization or to determine compliance with this chapter. In the event such health maintenance organization fails to comply with such order, the commissioner shall have the power to examine the health maintenance organization and such affiliates to obtain such information.
(2) The commissioner may retain, at the expense of the health maintenance organization, such attorneys, actuaries, accountants and other experts not otherwise a part of the commissioner's staff as shall be reasonably necessary to assist in the conduct of the examination under subparagraph (1). Any persons so retained shall be under the direction and control of the commissioner and shall act in a purely advisory capacity.
(3) Each registered health maintenance organization producing records, books and papers for said examination pursuant to said subparagraph (1) shall be liable for and shall pay the expense of such examination.
(u) Notwithstanding any other provisions of the General Laws, including clause Twenty-sixth of section 7 of chapter 4 and chapter 66, all information, documents and copies thereof obtained by or disclosed to the commissioner or any other person in the course of an examination or investigation made pursuant to subsection (t) and all information reported pursuant to section 28, shall be given confidential treatment and shall be open only to the inspection of the commissioner, or examiners and assistants. Access to such confidential material may be granted by the commissioner to the National Association of Insurance Commissioners, to the insurance department of any other state or country or to law enforcement officials of the commonwealth or any other state or agency of the federal government at any time, so long as the agency or office receiving the information agrees in writing to hold such material confidential. Such confidential materials shall not be subject to subpoena and shall not be made public by the commissioner, the National Association of Insurance Commissioners, or any other person, without the prior written consent of the health maintenance organization to which it pertains unless the commissioner, after giving the health maintenance organization who would be affected thereby, notice and opportunity to be heard, determines that the interest of policyholders, members, shareholders, enrolled members or the public will be served by the publication thereof, in which event he may publish all or any part thereof in such manner as he may deem appropriate.
(v) The commissioner may, pursuant to chapter 30A, upon notice and opportunity for all interested parties to be heard, issue such rules, regulations and orders as shall be necessary to carry out sections 27 to 29, inclusive.
Section 29. (a)(1) Whenever it appears to the commissioner that any health maintenance organization or any director, officer, employee or agent thereof has committed or is about to commit a violation of sections 27 to 29, inclusive, or any rule, regulation or order issued by the commissioner thereunder, the commissioner may apply to the superior court department of the trial court for Suffolk county for an order enjoining such health maintenance organization or such director, officer, employee or agent thereof from violating or continuing to violate said sections 27 to 29, inclusive, or any such rule, regulation or order, and for such other equitable relief as the nature of the case and the interest of the health maintenance organization's policyholders, enrolled members, creditors, shareholders, members or the public may require.
(2) No security which is the subject of any agreement or arrangement regarding acquisition, or which is acquired or to be acquired, in contravention of sections 27 to 29, inclusive, or of any rule, regulation or order issued by the commissioner thereunder, may be voted at any shareholder's meeting, or may be counted for quorum purposes, and any action of shareholders requiring the affirmative vote of a percentage of shares may be taken as though such securities were not issued and outstanding; but no action taken at any such meeting shall be invalidated by the voting of such securities, unless the action would materially affect control of the health maintenance organization or unless the courts of this commonwealth have so ordered. If a health maintenance organization or the commissioner has reason to believe that any security, membership or board of directors appointment or election rights of the health maintenance organization has been or is about to be acquired in contravention of sections 27 to 29, inclusive, of any rule, regulation or order issued by the commissioner thereunder, the health maintenance organization or the commissioner may apply to the superior court department of the trial court for Suffolk county to enjoin any offer, request, invitation, agreement or acquisition made in contravention of sections 27 to 29, inclusive, or any rule, regulation or order issued by the commissioner thereunder, to enjoin the voting of any security so acquired, to void any vote of such security already cast at any meeting of shareholders, and for such other equitable relief as the nature of the case and the interest of the health maintenance organization's policyholders, enrolled members, creditors, shareholders, members or the public may require.
(3) In any case where a person has acquired or is proposing to acquire any voting securities, membership or board of directors appointment or election rights of a health maintenance organization in violation of sections 27 to 29, inclusive, or any rule, regulation or order issued by the commissioner thereunder, the superior court department of the trial court for Suffolk county, or the superior court department of the trial court for the county in which the health maintenance organization has its principal place of business, may, on such notice as the court deems appropriate, upon the application of the health maintenance organization or the commissioner seize or sequester any voting securities of the health maintenance organization owned directly or indirectly by such person, and issue such order with respect thereto as may be appropriate to effectuate sections 27 to 29, inclusive. Notwithstanding any other provision of law, for the purposes of said sections 27 to 29, inclusive, the sites of the ownership of the securities of domestic health maintenance organizations shall be deemed to be in the commonwealth.
(b)(1) Any health maintenance organization failing, without just cause, to file any registration statement as required in sections 27 to 29, inclusive, may be required, after notice and hearing, to pay a penalty of $500 for each day's delay. The maximum penalty under this section shall be $10,000. The commissioner may reduce the penalty if the health maintenance organization demonstrates to the commissioner that the imposition of the penalty would constitute a financial hardship to the health maintenance organization.
(2) Every director or officer of a health maintenance organization holding company system who knowingly violates, participates in, or assents to, or who knowingly shall permit any of the officers or agents of the health maintenance organization to engage in transactions or make investments which have not been properly reported or submitted pursuant to subsection (a), (m) or (q) of section 28, or which violate any provisions of sections 27 to 29, inclusive, may if so determined by the commissioner, pay, in their individual capacity, a civil forfeiture of not more than $5,000 per violation, after notice and hearing before the commissioner. In determining the amount of the civil forfeiture, the commissioner shall take into account the appropriateness of the forfeiture with respect to the gravity of the violation, the history of previous violations and such other matters as justice may require.
(3) Whenever it appears to the commissioner that any health maintenance organization subject to sections 27 to 29, inclusive, or any director, officer, employee or agent thereof has engaged in any transaction or entered into a contract which is subject to subsections (i) to (v), inclusive, of section 28 and which would not have been approved had such approval been requested, the commissioner may order the health maintenance organization to cease and desist immediately any further activity under that transaction or contract. After notice and hearing the commissioner may also order the health maintenance organization to void any such contracts and restore the status quo if such action is in the best interest of the health maintenance organization's policyholders, enrolled members, creditors, subscribers or the public.
(4) Whenever it appears to the commissioner that any health maintenance organization or any director, officer, employee or agent thereof has committed a willful violation of sections 27 to 29, inclusive, the commissioner may report the facts to the attorney general or to the proper district attorneys. Any health maintenance organization that willfully violates any provision of sections 27 to 29, inclusive, may be fined not more than $10,000. Any individual who willfully violates any provision of said sections 27 to 29, inclusive, may be fined in his individual capacity not more than $5,000 per violation.
(5) Any officer, director, or employee of a health maintenance organization holding company system who willfully and knowingly subscribes to or makes or causes to be made any false statements, false reports or false filings with the intent to deceive the commissioner in the performance of his duties under sections 27 to 29, inclusive, upon conviction thereof, shall be imprisoned for not more than two years or fined $5,000, or both. The officer, director or employee shall pay any fines imposed in his individual capacity.
(c) Whenever it appears to the commissioner that any person has committed a violation of sections 27 to 29, inclusive, which so impairs the financial condition of a domestic health maintenance organization as to threaten insolvency or make the further transaction of business by it hazardous to its policyholders, enrolled members, creditors, subscribers, or the public, then the commissioner may proceed as provided in sections 20 and 20A and chapter 175J.
(d)(1) If an order for liquidation or rehabilitation of a domestic health maintenance organization has been entered, the receiver appointed under such order shall have a right to recover on behalf of the health maintenance organization, (i) from any parent corporation or holding company or person or affiliate who otherwise controlled the health maintenance organization, the amount of distributions, other than distributions of shares of the same class of stock, paid by the health maintenance organization on its capital stock, or (ii) any payment in the form of a bonus, termination settlement or extraordinary lump sum salary adjustment made by the health maintenance organization or its subsidiaries to a director, officer or employee, where the distribution or payment pursuant to clauses (i) or (ii) is made at any time during the one year preceding the petition for liquidation, conservation or rehabilitation, as the case may be, subject to the limitations of paragraphs (2), (3) and (4) of this subsection.
(2) No such distribution shall be recoverable if the parent corporation or affiliate shows that when paid such distribution was lawful and reasonable, and that the health maintenance organization did not know and could not reasonably have known that such distribution might adversely affect the ability of the health maintenance organization to fulfill its contractual obligations.
(3) Any person who was a parent corporation or holding company or a person who otherwise controlled the health maintenance organization or affiliate at the time such distributions were paid shall be liable up to the amount of distributions or payments under paragraph (1) such person received. Any person who otherwise controlled the health maintenance organization at the time such distributions were declared shall be liable up to the amount of distributions he would have received if they had been paid immediately. If 2 or more persons are liable with respect to the same distributions, they shall be jointly and severally liable.
(4) The maximum amount recoverable under this subsection shall be the amount needed in excess of all other available assets of the impaired or insolvent health maintenance organization to pay the contractual obligations of the impaired or insolvent health maintenance organization.
(5) To the extent any person liable under paragraph (3) is insolvent or otherwise fails to pay claims due from it pursuant to said paragraph (3), its parent corporation or holding company or person who otherwise controlled the health maintenance organization or affiliate at the time the distribution was paid, shall be jointly and severally liable for any resulting deficiency in the amount recovered from such parent corporation or holding company or person who otherwise controlled it.
(e) Whenever it appears to the commissioner that any person has committed a violation of sections 27 to 29, inclusive, which makes the continued operation of a health maintenance organization contrary to the interest of the policyholders, enrolled members or the public, the commissioner may, after giving notice and an opportunity to be heard, suspend, revoke or refuse to renew such health maintenance organization's license or authority to do business in the commonwealth for such period as he finds is required to protect the interests of the policyholders, enrolled members or the public. Any such determination shall be accompanied by specific findings of fact and conclusions of law.
(f)(1) Any person aggrieved by any act, determination, rule, regulation or order or any other action of the commissioner pursuant to sections 27 to 29, inclusive, may appeal therefrom to the superior court department of the trial court for Suffolk county. The court shall conduct its review without a jury and by trial de novo, except that if all parties, including the commissioner, so stipulate, the review shall be confined to the record. Portions of the record may be introduced by stipulation into evidence in a trial de novo as to those parties so stipulating.
(2) The filing of an appeal pursuant to this subsection shall stay the application of any such rule, regulation, order or other action of the commissioner to the appealing party unless the court, after giving such party notice and an opportunity to be heard, determines that such a stay would be detrimental to the interest of policyholders, enrolled members, shareholders, creditors, members or the public.
(3) Any person aggrieved by any failure of the commissioner to act or make a determination required by sections 27 to 29, inclusive, may petition the superior court department of the trial court for Suffolk county for a writ in the nature of a mandamus or a peremptory mandamus directing the commissioner to act or make such determination forthwith.
SECTION 47. Section 31 of chapter 19 of the acts of 1993 is hereby repealed.
SECTION 48. Chapter 133 of the acts of 1992 is hereby amended by striking out section 137 and inserting in place thereof the following section:-
Section 137. (a) Notwithstanding any general or special law, rule or regulation to the contrary, there shall be established an Urban Initiative Fund, a loan and grant program for inner-city neighborhoods; provided that grants shall be made available for the purposes of education, job training, business development, health care, day care, youth activities, including athletic and recreation programs, violence and crime prevention, and housing; provided, that loans shall be for the purpose of business development, employment creation and employment preservation; provided further, that loans shall be made to non-profit organizations and profit-motivated businesses located in targeted communities; provided further, that said organizations and businesses shall be owned and controlled by minority group members; provided further that, notwithstanding sections 4, 4A, and 5 of chapter 40F of the General Laws to the contrary, the community development finance corporation shall administer the Urban Initiative Fund for the purposes of the loan and grant program; provided further, that all interest income received from loans issued pursuant to the Urban Initiative Fund program shall be applied to the administrative costs of the community development finance corporation; and provided further, that all expenditures made pursuant to the program shall be reviewed as part of the state auditor's annual field audit of the Massachusetts Community Development Finance Corporation, pursuant to section 7A of chapter 324 of the acts of 1987.
SECTION 49. The definition of "project" in subsection (a) of section 11 of chapter 294 of the acts of 1996 is hereby amended by inserting after the word "park", in line 2, the following words:- and residential housing.
SECTION 50. Item 6033-9015 of section 2 of chapter 246 of the acts of 2002 is hereby amended by striking out the words "For the Mystic Valley development commission to be allocated for engineering and construction costs", in lines 1 and 2, and inserting in place thereof the following words:- For the Mystic Valley development commission to pay for and reimburse the costs of, the acquisition of parcels of land designated as parcels numbered 4-7, 4-8, 4-12 and 4-14 on a plan of land entitled "Plan of Land in the Cities of Malden, Medford and Everett, MA; Mystic Valley Development Commission; Composite Plan of Property Acquisitions in a Portion of Land in the Telecom City Project; Fay, Spofford & Thorndike, LLC; May 1, 2003" and the relocation of occupants therefrom.
This section was vetoed by the Governor.
SECTION 51. Said item 6033-9015 of said section 2 of said chapter
246 is hereby further amended by adding the following words:- provided, however,
that said payment and reimbursement shall not diminish the portion of the bond
cap available to the department of highways in any year in which payment and reimbursement
is made.
This section was vetoed by the Governor.
SECTION 52. (a) Notwithstanding any special or general law to the
contrary, the department of revenue shall institute a Massachusetts Corporation
Tax Benefit Certificate program.
As used in this section, the following
words shall have the following meanings:-
"Affiliated company", a
company that directly or indirectly owns or controls 5 per cent or more of the
voting rights or 5 per cent or more of the value of all classes of stock of the
corporation surrendering the tax benefit.
"Department", the Massachusetts
department of revenue.
"Job growth", the increase in the number of
persons employed by a new or expanding company from the beginning to the end of
a calendar year.
"New or expanding company", a corporation that satisfies
the criteria set forth in subsection (d).
"Program", the Massachusetts
Corporation Tax Benefit Certificate program.
"Purchasing corporation",
a corporation that is subject to tax under chapter 63 of the General Laws and
that provides financial assistance to a new or expanding company in exchange for
a tax benefit certificate. The purchasing corporation may not be an affiliated
company.
"Tax benefit", net operating loss carry forward described
in paragraph 5 of section 30 of said chapter 63 and the credit for research expenses
set forth in section 38M of chapter 63.
"Tax benefit amounts eligible
for transfer", in the case of credits, the aggregate amount of credits that the
corporation generated but was not able to use as of the close of the last taxable
year for which a return was filed, because of limited tax liability or any limitations
upon use of credits set forth in this section; in the case of net operating loss
carry forwards, the aggregate amount of the net operating loss carry forwards
that the corporation generated but was not able to use as of the close of the
last taxable year for which a return was filed, because of limited tax liability
or any limitations upon use of such carry forwards set forth in said chapter 63,
multiplied by the Massachusetts apportionment factor of the corporation that generated
the carry forwards for the last taxable year for which a return was filed, multiplied
by 9 1/2 per cent.
(b) The department shall establish the Massachusetts
Tax Credit Certificate Program to allow new or expanding companies doing business
in the commonwealth with unused tax benefits to surrender those tax benefits for
use by purchasing corporations in exchange for private financial assistance to
be provided by the corporations to assist in the funding of costs incurred by
the new or expanding companies. The private financial assistance shall be used
to fund expenses incurred in connection with the operation of the new or expanding
company in the commonwealth, including but not limited to, costs associated with
fixed assets, such as the construction and acquisition and development of real
estate, materials, start-up, tenant fit-out, working capital, salaries, research
and development expenditures, and any other expenses determined by the department,
with the assistance of the Massachusetts office of business development and the
Massachusetts Technology Park Corporation, to be necessary to carry out the purposes
of the program.
(c) A new or expanding company that wishes to participate
in the program shall file an application with the department, on a form prescribed
by the department, that sets forth the tax benefit amounts eligible for transfer,
the use to which the new or expanding company intends to put the private financial
assistance to be provided, the identity of the purchasing corporation, the amount
of the financial assistance to be provided, and such other information as the
department may require. The tax benefits shall not be surrendered unless the purchasing
corporation provides financial assistance in an amount at least equal to 75 per
cent of the tax benefit amounts eligible for transfer.
(d) The department,
with the assistance of the Massachusetts office of business development and the
Massachusetts Technology Park Corporation, shall review the applications and,
if the proposed transfer meets the requirements set forth in this section, it
may, upon receipt of adequate evidence that the purchasing corporation has provided
the specified financial assistance, issue a tax benefit certificate to the purchasing
corporation reflecting the tax benefit amounts transferred, a copy of which shall
be attached to each tax return filed by a purchasing corporation in which the
tax benefits are used. All applications shall be received on or before June 30
for the next succeeding state fiscal year.
(e) To receive approval,
an applicant shall meet the following criteria:-
(1) the applicant
shall have more than 15 full-time employees but fewer than 150 full-time employees;
(2) the applicant shall satisfy one of the following criteria;
(i) At least 10 per cent job growth in each of the last 2 years;
(ii) At least 20 per cent cumulative job growth over the last 2 years; or for
companies in existence for less than 2 years as of the date of application, job
growth that exceeds 10 per cent per calendar year on a pro-rate basis;
(3) applicants that have surrendered benefits in the past shall demonstrate job
growth of not less than 10 per cent in each of the years in which it surrendered
benefits; and
(4) Applicants shall not be established solely for the
purpose of obtaining and transferring tax credits under this section.
(f) The department may also consider the following criteria:
(1) whether
the company has existing contractual relationships with other companies in the
commonwealth, charitable corporations, institutions of higher learning or state,
regional or local governments;
(2) whether the company's products
are sufficiently innovative to provide a competitive advantage;
(3)
whether the company has sufficient resources to operate in the short term; and
(4) whether the proposed financial assistance will result in significant
growth in permanent, full-time employment in the commonwealth.
(g)
The department may require certifications or audits to determine compliance with
the requirements of subsections (e) and (f).
(h) The total amount
of the tax credit transfers authorized by the department shall not exceed $2,000,000
for any given year. The maximum annual value of tax benefits that a corporation
may surrender under the program is $200,000. The maximum cumulative value of tax
benefits that a corporation may surrender under the program shall not exceed $1,000,000.
No application shall be approved in which the new or expanding company: (1) has
demonstrated positive net income in any of the two previous full years of ongoing
operations as determined on its financial statements; or (2) has demonstrated
a ratio in excess of 110 per cent or greater of operating revenues divided by
operating expenses in any of the two previous full years of operations as determined
on its financial statements; or (3) is directly or indirectly at least 50 per
cent owned or controlled by another corporation that has demonstrated positive
net income in any of the 2 previous full years of ongoing operations as determined
on its financial statements or is part of a consolidated group of affiliated corporations,
as filed for federal income tax purposes, that in the aggregate has demonstrated
positive net income in any of the 2 previous full years of ongoing operations
as determined on its combined financial statements.
(i) The purchasing
corporation shall enter into a written agreement with the new or expanding company
concerning the terms and conditions of the private financial assistance made in
exchange for the tax benefit certificate. A copy of the agreement shall be filed
with the application. The copy of the agreement shall be subject to section 21
of chapter 62C of the General Laws, but the department may publish statistics
so classified as to prevent the identification of particular agreements or parties
thereto.
(j) The purchasing corporation shall treat the tax benefit
amounts purchased under the program as a credit against its excise under chapter
63 of the General Laws. The purchasing corporation shall use the tax benefit amounts
so treated in tax returns filed within 5 years of the issuance of the certificate,
after which the benefits will be considered to have expired. The purchasing corporation
may not use the tax benefit amounts to reduce the excise to less than the amount
due under subsection (b) of section 32 of said chapter 63, subsection (b) of section
39 of said chapter 63, or section 67 of said chapter 63.
(k) Any new
or expanding company that applies for a tax benefit certificate under this program
shall pay a non-refundable fee of $1000 for its first application and a $500 fee
for its second and subsequent applications.
(l) No new or expanding
company that has surrendered tax benefits under the program may use the benefits
to reduce its tax liability under said chapter 63.
(m) Tax benefits
transferred pursuant to this section may only be used as a credit under the excise
due under said chapter 63 for taxable years beginning on or after January 1, 2004.
The department of revenue shall not issue any certificates pursuant to this section
after July 1, 2009.
(n) The commissioner of revenue shall report on
the results of the Massachusetts Corporation Tax Benefit Certificate program set
forth in this section, including the numbers of applications received and granted,
the amounts of the tax benefits transferred and the forms and uses of private
financial assistance provided under the written agreements for the assistance.
The commissioner shall file an interim report of results on or before July 1,
2007 with the joint committee on taxation and the house and senate committees
on ways and means, and shall file a final report with recommendations for further
legislative action with the joint committee on taxation and the house and senate
committees on ways and means by December 31, 2009.
(o) The commissioner
of revenue shall promulgate regulations necessary to implement this sections.
This section was vetoed by the Governor.
The Governor's veto was overridden by the Legislature
SECTION 53. (a) There shall be established within the department of business
and technology a small business and very small firms assistance advisory council,
in this section called council, which shall make policy recommendations to the
department regarding the commonwealth's small business and very small firms assistance
programs and funding activities. For the purposes of this act, the term "very
small firms" shall include entrepreneurs whose businesses employ less than 20
people and are less likely and less able to tap traditional sources of business
consulting, assistance and finance.
(b) The council shall be comprised of the following members: the director of the department of business and technology or his designee, who shall serve as the chair of the council; the director of the department of housing and community development or his designee; the director of Massachusetts Development or his designee; the President of the Massachusetts Community Development Finance Agency; the director of the state office of minority and women business assistance; a representative of the Massachusetts Entrepreneurial Opportunity Network; a representative of the Massachusetts Association of Community Development Corporations; a representative of the Massachusetts Community Action Program Director's Association; a representative of the Massachusetts Bankers Association; a representative of the Massachusetts Community Banking Council; the director of the Massachusetts office of the Small Business Administration or his designee; and the following 4 members to be appointed by the director of the department of business and technology: a representative of the commonwealth's small business centers, the director of a community development financial institution, a small business owner, and, a member of an organization that provides technical assistance or training to very small firms.
(c) Members of the council shall serve for 2 year terms and shall be appointed within 3 months of the effective date of this act.
(d) The council shall: conduct an evaluation of the current state system of delivering assistance to small businesses and very small firms; produce data on the number and types of small businesses and very small firms in the commonwealth; research and investigate strategies for the delivery of state assistance to small businesses and very small firms; make recommendations to the department of business and technology and the legislature for improving the delivery system for assistance to small businesses and very small firms, including recommendations for a more efficient and effective strategy for reaching and providing assistance to very small firms, cost-effective delivery methods for providing technical assistance, better coordination of assistance programs, and better coordination with other state programs, agencies, and public instrumentalities so that state assistance can leverage charitable foundation support, federal program funding and private sector support for small businesses and very small firms; and, conduct continual evaluations of the commonwealth's delivery system.
(e) The council shall meet on a monthly basis or as needed and shall produce an initial report within 6 months of its first meeting to the governor, the secretary of economic affairs, and the clerks of the house of representatives and the senate who shall forward the same to the president of the senate, the minority leader of the house, the minority leader of the senate, the speaker of the house of representatives and the chairpersons of the house and senate committees on labor and commerce. The report shall contain the evaluation of the current state system of delivering assistance to small businesses and very small firms. The council shall also report within 1 year of first meeting, which report shall outline best practices for state-level delivery of assistance to small businesses and very small firms and make recommendations to the department of business and technology for improving the delivery system. Thereafter, the council shall meet at least quarterly and additionally as needed. The council shall report annually, evaluating the state system of delivering assistance to small businesses and very small firms with recommendations for improvements.
This section was reduced and words were striken by the
Governor.
The Governor's veto was overridden
by the Legislature
SECTION 54. Notwithstanding any general or
special law to the contrary, not later than 10 days after the effective date of
this act, $6,000,000 shall be made available from the Economic Stimulus Trust
Fund to the department of workforce development for grants administered by the
department for the following purposes:
Of the total transfer, not less than $3,000,000 shall be expended for the operation of programs whose primary purpose is workplace education and training grants managed by industry-driven partnerships that include, but are not limited to, workforce development providers, institutions of higher education, and employers to promote the career advancement of workers and the productivity of businesses in the commonwealth, including for the operation of the Building Essential Skills through Training Initiative.
Not more than $250,000 shall be made available to the Massachusetts Council of Human Service Providers, Inc. to develop an industry-guided, internet-based workforce development program for direct care workers who provide direct care services pursuant to purchase of service contracts with the executive office of health and human services or agencies within that executive office.
The workforce development grant program shall: (1) provide essential training and credentialing for the direct care workforce in an industry; (2) improve the quality of services provided to clients; and (3) improve recruitment and retention of a well-trained direct care workforce. The council may expend these funds to hire a program director as well as consultants with expertise in the field of human services training to develop a curriculum and to administer the program using an e-learning, or web or internet based environment.
Not less than $1,250,000 of the funds allocated herein shall be for grants under the health professions worker training program established pursuant to section 9 of chapter 23H of the General Laws; provided, that not less than $500,000 shall be provided for grants to providers of workforce development and job skills training services for projects benefiting older adults; provided further, that not less than $1,000,000 shall be made available for grants under a competitive application process to community-based nonprofit organizations that provide workforce development and job training services, utilizing the following criteria; whether the project will lead to employment on the part of unemployed individuals and improved employment for low wage workers; whether the project will result in employment at wages sufficient to support a family or place individuals on a career path leading to such employment and wages; and whether the project will have a positive economic impact on a region with high levels of unemployment or a high concentration of low-skilled workers. Grants awarded under this section shall observe the following guidelines: the educational or eligible service provider, as defined in section 8 of chapter 23H, is an existing, experienced, and effective provider of workforce development services within the state; the program involves workforce development services that is an area of local employment need, particularly for low income residents or low wage workers; and preference will be given to educational and eligible service providers, as defined in section 8 of chapter 23H, which provide workforce development services which operate in economic opportunity areas as defined in section 3E of chapter 23A of the General Laws or serve residents of economic opportunity areas.
Recipients of grants under this section must match such grant funding in an amount equal to thirty percent of the value of such grant. The match may be in the form of funding, equipment, or personnel.
The director shall annually, by September 31, 2005, report to the secretary of administration and finance, the house and senate committees on ways and means, the joint committee on education, arts and humanities, the joint committee on state administration, and the joint committee on commerce and labor the status of grants awarded under this section, including the number of educational and eligible service provider s receiving grants, the number of participants receiving services, the number of participants placed in employment, the salary and benefits that participants receive post placement, and the cost per participant, and job retention or promotion rates one year after training ends.
The director, working with and through the state workforce investment board, may collect and disseminate information concerning areas of projected employment need. The state workforce investment board may also prepare and publish studies, organize conferences, and conduct special projects which will increase knowledge and communication in the areas of employment need, skills training, and education.
The director of the department of workforce development shall adopt regulations to carry out the purposes of this section.
SECTION 55. Notwithstanding any general or special law to the contrary, for the day of August 14, 2004, no excise shall be imposed upon non-business sales at retail in the commonwealth of tangible personal property, as defined in section 1 of chapter 64H of the General Laws, but for the purposes of this act, tangible personal property shall not include telecommunications, gas, steam, electricity, motor vehicles, boats, meals, or any single item whose price is in excess of $2,500.
SECTION 56. Notwithstanding any general or special law to the contrary, for the day of August 14, 2004 , no vendor in the commonwealth shall add to the sales price or collect from any purchaser any excise upon sales at retail of tangible personal property, as defined in section 1 of chapter 64H of the General Laws. The commissioner of revenue shall not require any vendor to collect and pay excise upon sales at retail of tangible personal property purchased on August 14, 2004 but any excise erroneously or improperly collected during the day of August 14, 2004 shall be remitted to the department of revenue. The provisions of this section shall not apply to the sale of telecommunications, gas, steam, electricity, motor vehicles, boats, meals, or any single item whose price is in excess of $2,500.
SECTION 57. Any reporting requirements imposed upon vendors of tangible personal property, by law or by regulation, including, but not limited to the requirements for filing returns required by chapter 62C of the General Laws, shall remain in effect for sales for the day of August 14, 2004.
SECTION 58. On or before December 31, 2004, the commissioner of revenue shall certify to the comptroller the amount of sales tax revenue forgone due to the operation of this act. The commissioner shall issue a report, detailing by fund the amounts under general and special laws governing the distribution of revenues under chapter 64H of the General Laws which would have been deposited in each fund, notwithstanding this act.
SECTION 59. The commissioner of revenue shall issue any instructions or forms, or promulgate rules or regulations, necessary to carry out the purposes of this act.
This section was vetoed by the Governor.
Overridden by the Legislature
SECTION 60.
(a) The Massachusetts International Trade Council shall establish the Massachusetts
International Tourism Fund, which shall be the fund in which private and in-kind
international travel, and tourism donations shall be accepted and recorded. The
fund shall be administered by the Massachusetts International Trade Council with
monthly lists of deposits, expenses and in-kind services submitted to the house
and senate committees on ways and means, the house and senate clerk, the office
of the state auditor, and the executive office of administration and finance by
the third Wednesday in January.
(b) The Massachusetts International Trade Council, in consultation with the advisory board established by this section, shall award a contract to a non-profit organization to provide international marketing and tourism promotion services on behalf of the commonwealth. The nonprofit organization shall be selected through a competitive procurement process, which process shall include without limitation a written request for proposals. Expenditures for the contract shall not exceed $2,000,000 and shall be funded from the Economic Stimulus Trust Fund established herein. The nonprofit organization shall match the amount of the contract with a binding pledge of funds or in-kind contributions equal to the amount of the contract award from nongovernmental sources to be expended for the purposes established in this section.
(c) Any in-kind contributions pledged by a nonprofit organization under this section shall be considered to have the value determined by the Massachusetts international trade council. The nonprofit organization shall not expend more than 20 per cent of the contract funds for the cost of administrative services. The organization shall, as a condition of receiving the grant, submit, by every third Wednesday in January for the duration of the contract, a total operating budget which shall identify each source and use of operating funds, and an operating plan which shall demonstrate how the grant promotes tourism. The office shall reserve the right to withhold the grants if the conditions outlined in this section are not met. Not more than 2 per cent of the amount shall be expended by the Massachusetts international trade council for administrative costs incurred by the council in connection with the administration of the contract.
(d) The International Trade Council shall establish an advisory board to advise it on the scope of services to be provided under the contract with the nonprofit organization and to provide ongoing guidance assistance to the International Trade Council regarding the management and oversight of the contract; provided, however, that the advisory board shall consist of not more than 17 members, as follows: the president of the senate or his designee; the speaker of the house or his designee; the chairman of the senate committee on ways and means or his designee; the chairman of the house committee on ways and means or his designee; 1 member to be appointed by the minority leader of the senate; 1 member to be appointed by the minority leader of the house; provided, however, that those members shall be broadly representative of the tourism industries in the commonwealth; 1 member to be appointed by the Massachusetts office of travel and tourism; 1 member to be appointed by the Greater Boston Convention and Visitors Bureau; 1 member to be appointed by the Greater Springfield Convention and Visitors bureau; 1 member to be appointed by the Massachusetts Restaurant Association; 2 members to be appointed by the Berkshire Visitors Bureau, 1 of whom shall be from a Berkshire area hotel; 2 members to be appointed by the Cape Cod Chamber of Commerce, 1 of whom shall be from a Cape Cod area hotel; 1 member to be appointed by the Bristol County Convention and Visitors Bureau; 1 member to be appointed by the Massachusetts Cultural Council; and 1 member to be appointed by the Massachusetts Lodging Association; provided further, that the members of the advisory board shall serve without compensation and at the pleasure of their appointing authorities; provided further that the advisory board shall seek additional funding from private funding sources; and provided further, that notwithstanding any general or special law to the contrary, advisory board members shall not be deemed state employees for the purposes of chapter 268A of the General Laws as a result of their service on the advisory board.
SECTION 61. Notwithstanding any general or special law to the contrary, $20,750,000 of the unexpended balance of the Workforce Training Fund as of July 1, 2003, established pursuant to section 2RR of chapter 29 of the General Laws, may be expended in fiscal year 2004, without further appropriation, for workforce development grants committed to prior to July 1, 2003, under the terms of said section.
This section was vetoed by
the Governor.
SECTION 62. Notwithstanding any general
or special law to the contrary, (a) there shall be a council of economic advisors,
in this section called the "council", to develop long-term policies to support
economic development in the commonwealth. The council shall serve as an advisor
to the governor and the general court and shall be administered by the secretary
of economic affairs. The council shall consist of equal numbers appointed by the
governor, the senate president and the speaker of the house. Members shall include,
but not be limited to, representatives from relevant industry sectors, institutions
of higher learning, labor organizations, nonprofit organizations, financial institutions,
and relevant quasi-public organizations.
(b) At a minimum, the council
shall conduct studies and make recommendations relating to policy development
in the following areas: e-government and e-commerce, emerging technologies and
the labor market for scientists, engineers and science and math educators in the
commonwealth. The council shall make recommendations as to how the commonwealth
may encourage companies to conduct business within the commonwealth, and shall
place an emphasis on promoting greater minority and women involvement in emerging
technology sectors.
(c) The council shall establish the following
task force and others that it deems to be needed from time to time: a task force
on science, math, engineering and technology education to investigate, study and
make legislative recommendations on maintaining a specialized workforce to support
and expand the science, math, engineering and technology sectors in the commonwealth,
preparing students for the demands of a knowledge-based economy of the future
and attracting and retaining students entering science, math, engineering and
technology fields of study. The task force shall also investigate the public college
and university system, including community colleges, to establish job training
programs specifically geared toward creating manufacturing, science, math, engineering
and technology employment opportunities and to identify and establish career ladders
within science, math, engineering and technology employment opportunities. The
task force shall also investigate the impact of changing demographics on the state
and make recommendations on ways to incorporate such changes in order to enhance
the state's capacity to build a strong and competitive workforce. The task force
shall include the following members, among others: the commissioner of the department
of education or his designee; the director of workforce development, or his designee;
a labor economist; a CEO of a life-science firm; a CEO of a technology firm; a
CEO of a health care corporation; a representative of a woman-led firm and minority-led
firm; the chair of the board of higher education, or his designee; a chancellor
of a state university or college; a president of a state college; a president
of a community college; a superintendent of a Massachusetts public school system;
the executive director of the Massachusetts Technology Collaborative; the executive
director of the Massachusetts Development Finance Agency; the President of Associated
Industries of Massachusetts; the President of the Massachusetts Federation of
Teachers; 3 members of the senate to be appointed by the senate president, 1 of
whom shall serve as co-chair and 1 of whom shall be a member of the minority party;
and three members of the house of representatives to be appointed by the speaker
of the house, 1 of whom shall serve as co-chair and 1 of whom shall be a member
of the minority party. The taskforce shall conduct hearings and file a report
on the results of its study, along with recommendations and any legislation necessary
to carry out its recommendations with the clerks of the house of representatives
and the senate, not later than June 1, 2004. The taskforce shall be administered
by the Massachusetts Technology Park Corporation, established pursuant to chapter
40J of the General Laws.
SECTION 63. Notwithstanding any general or special law to the contrary, the board of higher education shall, in consultation with the presidents and chancellors of the Massachusetts state universities, colleges, and community colleges, or their designees, conduct a study of the feasibility of creating courses at the request of businesses residing in Massachusetts, customized to address the special workforce needs of said businesses, for which said businesses will pay the state institution providing the educational service a tuition fee to be set by an agreement between said institution and said businesses. The board shall solicit opinions from state business leaders, including, but not limited to, executives, managers, and other business officials who have a vested interest in the effective education of the state workforce. The board shall issue a report to the joint committee on education, arts and humanities, the joint committee on commerce and labor, and the clerks of the house of representatives and the senate, no later than September 1, 2004, which shall state the findings of the board; provided, that said findings shall include: the cost effectiveness for businesses to utilize state higher education resources for the education and training of their workforce; estimates of the tuition revenue generated by providing customized courses for the education and training of the employees of state businesses, which would be available for the supplementation of the operating budget and endowment of a given state institution of higher education; a detailed synopsis of the proposed subject matter and structure of courses that could be created at the request of businesses for the purpose of workforce education and training; testimonies from state business leaders regarding their interest in utilizing state higher education resources for the purpose of workforce education and training; and any other item the board feels would provide an accurate representation of the feasibility of such policy. The board shall also consider in the course of its study, and include in its report, as provided in this section, the structure of customized business courses provided by business graduate schools for large blue chip and other companies, which are generating hundreds of thousands of dollars in additional revenue for said business graduate schools. The board shall also consider in the course of its study, and include in its report, as provided in this section, the feasibility of customized courses for the purpose of workforce education and training for workers of all skill levels, across all industries. The board shall consider said study and said report, as provided in this section, to be an important initiative in the state strategy to better integrate the workforce education and training needs of state workers and businesses with the extensive educational resources of the institutions of higher education of the commonwealth, and shall pursue this study, as provided in this section, and follow the intent of this section, with all appropriate due diligence.
This section
was reduced by the Governor.
Overridden by the
Legislature
SECTION 64. Notwithstanding any general or special
law to the contrary, 10 days after the effective date of this act, the comptroller
shall transfer $2,400,000 from the Economic Stimulus Trust Fund to the Massachusetts
Technology Transfer Center at the University of Massachusetts established in section
45 of chapter 75 of the General Laws. Of that amount not less than $500,000 shall
be made available as a one-time grant to the center for economic analysis and
assessment within the McCormack Graduate School of Policy Studies' Center for
State and Local Policy.
This section was reduced
by the Governor.
Overridden
by the Legislature
SECTION 65. Notwithstanding any general or
special law to the contrary, not less than $1,000,000 from the Economic
Stimulus Trust Fund shall be made available to the Massachusetts Community Development
Finance Corporation for the recapitalization of said corporation.
SECTION 66. Notwithstanding any general or special law to the contrary, all assets of the Urban Initiative Fund as of the effective date of this act shall be transferred to the sole control of the Massachusetts Community Development Finance Corporation; provided, that the transfer shall take effect upon the effective date of this act; provided further, that all loans issued pursuant to the Urban Initiative Fund loan program and outstanding as of the effective date of this act shall remain in full force and effect and shall be administered by the Massachusetts Community Development Finance Corporation; provided further, that 5 per cent of any cash assets of the Urban Initiative Fund transferred to the sole control of the corporation pursuant to this section shall fund loans to newly-organized and start-up, profit-motivated businesses, and to existing businesses that do not generate more than $500,000 in yearly gross receipts, for the purposes of education, job training, business development, health care, day care, youth activities, violence and crime prevention, and housing; provided further, that the businesses shall be located in targeted communities and shall be owned and controlled by minority group members; provided further, that all funds received by the Massachusetts Community Development Finance Corporation as payments of principal on said outstanding loans shall be considered funds available for loans to newly-organized and start-up, profit-motivated businesses, and to existing businesses that do not generate more than $500,000 in yearly gross receipts, for the purposes of education, job training, business development, health care, day care, youth activities, violence and crime prevention, and housing; provided further, that the businesses shall be located in targeted communities and shall be owned and controlled by minority group members; provided further, that all funds received by the Massachusetts Community Development Finance Corporation as interest payments on the outstanding loans shall be applied to the administrative costs of the corporation; and provided further, that any other assets of the Urban Initiative Fund transferred to the sole control of the Massachusetts Community Development Finance Corporation pursuant to this section shall be available for loans and grants pursuant to this act.
This section
was vetoed by the Governor.
SECTION 67. Notwithstanding
any general or special law to the contrary, there shall be a special commission
to study and report legislative findings relative to sections 14 to 17, inclusive,
of this act and on the laws, rules and procedures used by state agencies to promulgate
regulations, including, but not limited to the cost impact of such regulatory
changes. The commission shall further study the effect of reauthorizing regulations
every 5 years, the advantages and disadvantages of regulatory impact statements,
the type of notice parties to regulation receive and the agencies' legislative
reporting requirements. This commission shall consist of 9 members, 3 of which
shall be appointed by the senate president, including the minority leader of the
senate, and the senate chair of the joint committee on commerce and labor who
shall act as the co-chair, the 3 of which shall be appointed by the speaker of
the house, including the minority leader of the house, and the house chair of
the joint committee on commerce and labor who shall act as the co-chair and 3
members appointed by the attorney general. This commission shall conduct hearings
and file a report on the results of its study, along with recommendations and
any legislation necessary to carry out its recommendations with the clerks of
the house of representatives and the senate not later than April 30, 2004.
SECTION 68. Notwithstanding any general or special law to the contrary, there is hereby established and set up on the books of the commonwealth the Economic Stimulus Trust Fund, the purposes of which shall be to fund programs established in this act. Not later than 10 days after the effective date of this act, the comptroller shall transfer the following amounts to said Economic Stimulus Trust Fund: (i) the amount of $33,633,333 from the Health Care Security Trust Fund, established pursuant to section 1 of chapter 29D of the General Laws, (ii) the amount of $33,633,333 from the Stabilization Fund, established pursuant to section 2H of chapter 29 of the General Laws and (iii) the amount of $33,633,334 from any monies received by the commonwealth in accordance with the federal Jobs Growth Act of 2003. Said fund shall be a separate expendable trust, subject to the control of the state comptroller, who shall serve as the trustee of the fund. The fund shall be a separate expendable trust, shall not be subject to appropriation and shall be administered in accordance with this act. Said fund shall expire on June 30, 2004.
SECTION 69. The department of revenue shall certify by December 31, 2004 the amount necessary to reconcile General Fund revenues lost pursuant to sections 21 and 25, 27 and 29, sections 55, 56 and 57, and section 52. The comptroller shall transfer an amount not to exceed $16,000,000 not later than June 30, 2004 from the Stabilization Fund to the General Fund for these purposes.
This section was reduced by the Governor.
Overridden by the Legislature
SECTION 70.
Notwithstanding any general or special law to the contrary, the comptroller shall
transfer, effective December 31, 2003, to the Massachusetts Technology Park Corporation
established pursuant to section 3 of chapter 40J of the General Laws, the amount
of $15,000,000 from the Economic Stimulus Trust Fund, established pursuant to
this act, for the creation and operation of the John Adams Innovation Institute
under said Massachusetts Technology Park Corporation, established pursuant to
section 6A of chapter 40J. Said amount shall be deposited in a separate fund,
administered by said corporation, which shall be expended exclusively for the
uses established in said section 6A. Commencing on April 1, 2004, the executive
director of said corporation shall report quarterly to the house and senate committees
on ways and means, the house and senate committees on science and technology,
and the joint committee on commerce and labor on the following: (i) a detailed
description of purposes and amounts of administrative costs charged to the fund,
(ii) the annual budget of the John Adams Innovation Enterprise, (iii) a quarterly
statement of cash inflows and outflows detailing the sources and uses of funds,
(iv) a description of the organizations receiving funds from this fund, the purposes
to which the funding will be used by said organizations, (v) the associated amounts
received by each organization, (vi) the amounts of non-state funding leveraged
as a result of the funding, a potential projection of the number and nature of
employment opportunities that may be created in the commonwealth as a result of
the various forms of assistance disbursed from said fund, and (vii) an analysis
of the purposes and geographical location of projects funded through the John
Adams Innovation Enterprise.
This section was reduced
and words struck out by the Governor.
Overridden
by the Legislature
SECTION 71. Notwithstanding any general or
special law to the contrary, the comptroller shall transfer, effective December
31, 2003, the amount of $25,000,000 from the from the Economic Stimulus Trust
Fund, established pursuant this act, to the Emerging Technology Fund, established
pursuant to section 27 of chapter 23G of the General Laws. Commencing on April
1, 2004, the executive director of the Massachusetts Development Finance Agency,
established pursuant to section 2 of said chapter 23G, shall file a report on
a quarterly basis with the house and senate committees on ways and means, the
house and senate committees on science and technology and the joint committee
on commerce and labor on the following: the number and amounts of qualified investments
made to further the goals of the fund, the number of loans and guarantees approved
by said agency from said fund for facilities or specialized equipment for technology-based
companies, a description of any financial and technical assistance that has been
provided to such technology based companies as a result of the utilization of
revenues within said fund, administrative costs charged to the fund, return on
investment in qualified investments, return on investments in funds not required
for immediate disbursement, a forecast of future payments based on current binding
obligations, and an analysis of the purposes and geographical location of qualified
investments; provided, that not less than $250,000 shall be transferred to the
Small Business Association of New England for the layoff aversion through management
assistance program for consultant and technical assistance to manufacturing companies
in Massachusetts to prevent business closure and employee displacement. Any such
expenditure of the layoff aversion through management program as provided for
in accordance with this section shall leverage at least $1 for each dollar granted
pursuant to this section. Commencing on January 1, 2004, the president of the
small business association of new england shall file a report on a quarterly basis
with the house and senate committees on ways and means, the house and senate committees
on science and technology, and the joint committee on commerce and labor on the
number of employees and manufacturing based companies that have received financial
assistance through this section, a detailed description of the services provided
to manufacturing companies in Massachusetts through the layoff aversion through
management program, and a detailed account of the expenditures of the layoff aversion
program, including administrative costs.
This section
was vetoed by the Governor.
The Governor's veto
was overridden by the Legislature
SECTION 72. Notwithstanding
any general or special law to the contrary, the comptroller shall transfer, effective
December 31, 2003, to the Massachusetts Technology Development Corporation, established
pursuant to section 3 of chapter 40G of the General Laws, the amount of $5,000,000
from the Economic Stimulus Trust Fund, established pursuant to this act. Commencing
on April 1, 2004, the board of directors of the Massachusetts Technology Development
Corporation shall submit a quarterly report to the house and senate committees
on ways and means, the house and senate committees on science and technology,
and the joint committee on commerce and labor on the number and nature of early
stage technology companies, both startup and expansion, operating in the commonwealth
that said corporation has invested in as a result of funds transferred to said
corporation pursuant to this section, the number and nature of jobs created in
Massachusetts as a result of investments made by said corporation from funds transferred
to said corporation pursuant to this section, the amount of private investments
leveraged for said companies as a result of investments made by said corporation,
the internal rate of return on the entire portfolio of investments made by said
corporation from funds transferred pursuant to this section, the cumulative realized
gains on equity investments made by said corporation since the transfer of funds
authorized by this section and the cumulative realized losses on both debt and
equity investments made by said corporation since the transfer of funds authorized
by this section.
This section was reduced by the
Governor.
Overridden by the Legislature
SECTION 73. Notwithstanding any general or special law to the contrary,
the comptroller shall transfer, effective December 31, 2003, to the Massachusetts
Mathematics, Science, Technology and Engineering Grant Fund, established pursuant
to this act, the amount of $2,500,000 from the Economic Stimulus Trust Fund, established
pursuant to this act for the creation and operation of said fund in accordance
with this act. Commencing on April 1, 2004, chancellor of higher education shall
report quarterly to the house and senate committees on ways and means, the house
and senate committees on science and technology, and the joint committee on commerce
and labor and the joint committee on education, arts and humanities on the following:
(i) a list of grant recipients, (ii) the associated grant amounts, (iii) the amounts
of nonstate funding leveraged as a result of the grants, (iv) the purposes of
the grants, (v) an annual statement of cash inflows and outflows detailing the
sources and uses of funds, (vi) a forecast of future payments based on current
binding obligations, and (vii) a detailed breakdown of the purposes and amounts
of administrative costs charged to the fund.
This
section was reduced by the Governor.
Overridden
by the Legislature
SECTION 74. Notwithstanding any general or
special law to the contrary, the comptroller shall transfer, effective December
31, 2003, $20,000,000 from the Economic Stimulus Trust Fund, established pursuant
to this act, to the Massachusetts Research Center Matching Fund, established pursuant
to section 4F of chapter 40J of the General Laws for the creation and operation
of the fund under the Massachusetts Technology Park Corporation. Commencing on
April 1, 2004, the executive director of the corporation shall report quarterly
to the house and senate committees on ways and means, the house and senate committees
on science and technology, and the joint committee on commerce and labor the following:
a list of grant recipients, the associated grant amounts, the amounts of non-state
funding leveraged as a result of the grants, the purposes of the grants, a quarterly
statement of cash inflows and outflows detailing the sources and uses of funds,
a forecast of future payments based on current binding obligations, and a detailed
breakdown of the purposes and amounts of administrative costs charged to the fund.
This section was reduced by the Governor.
The Governor's reduction was overridden by the Legislature
SECTION 75. Notwithstanding any general or special law to the
contrary, effective December 31, 2003, the comptroller shall transfer $6,000,000
shall be made available to the Brownfields Redevelopment Access to Capital Fund
from the Economic Stimulus Trust Fund. Commencing on April 1, 2004, the secretary
of economic development shall report quarterly to the house and senate committees
on ways and means, the house and senate committees on science and technology,
the joint committee on commerce and labor and the joint committee on natural resources
on the location and amounts of financing provided to applicants under this program
and the administrative costs charged to the fund.
This
section was vetoed by the Governor.
SECTION 76. (a) Notwithstanding
any general law or special law to the contrary, the Economic Stabilization Trust,
established pursuant to sections 8 to 16 of chapter 23D of the General Laws, shall
be solely within the Massachusetts Development Finance Agency, established pursuant
to chapter 23G of the General Laws. The trust shall continue to be a public instrumentality
and the exercise of its powers shall continue to be deemed the performance of
an essential government function and all approvals, agreements and obligations
of the trust on the effective date hereof shall remain in force. The trust shall,
pursuant to this act, exercise the powers of the trust as set forth in the commonwealth's
laws, and continue to own all of its assets and retain all of its liabilities.
This section was vetoed by the Governor.
SECTION 77. Sections 4A to 4D, inclusive, and section 76 of this
act shall take effect on June 30, 2004.
SECTION 78. Section 67D of chapter 62C of the General Laws shall be effective as to jobs incentive payment requests made by biotechnology companies or medical device manufacturing companies for calendar years 2005 to 2009, inclusive.
SECTION 79. Section 11 shall take effect on June 30, 2005.
This section
was vetoed by the Governor.
SECTION 80. Sections 14 to
17 inclusive, shall take effect on January 1, 2005.
SECTION 81. Sections 22 and 24 shall take effect on January 1, 2005 and shall apply to taxable years commencing on or after such date; provided, however that before the effective date of this act, the department of revenue, in consultation with the chairman of the Massachusetts historical commission may promulgate regulations necessary to implement and facilitate the implementation of this act.
This
section was vetoed by the Governor.
SECTION 82. Sections
21 and 26 shall take effect on January 1, 2004 and shall not apply to tax expenditures
granted or applied for before the effective date.
SECTION 83. Sections 33 to 46, inclusive, shall take effect on January 1, 2004.
Approved (in part) November 26, 2003.