Mass. Gen. Laws ch. 23J, sec. 16 — MA Code / Part I / Title II / Chapter 23J / Section 16
Climatetech tax incentive program; certification; annual report; revocation; amount of incentives
Status: in_force

[Text of section effective for tax years beginning on or after January 1, 2024. See 2024, 238, Sec. 325.]

[Text of section effective for tax years beginning on or after January 1, 2024. See 2024, 238, Sec. 325.]

Section 16. (a) There shall be established and placed within the center a climatetech tax incentive program that shall be administered by the center. The purpose of the program shall be to develop and expand climatetech related employment opportunities in the commonwealth and to promote climatetech related economic development in the commonwealth by supporting and stimulating research, development, innovation, manufacturing and deployment in the climatetech sector. A climatetech company certified pursuant to subsection (b) shall be eligible for participation in the program.

(b) The center may, upon a majority vote of the board, certify a climatetech company as eligible upon: (i) the timely receipt, as determined by the center, of a certification proposal supported by independently verifiable information, signed under the pains and penalties of perjury by a person expressly authorized to contract on behalf of the climatetech company and shall include, but shall not be limited to, an estimate of the projected new state revenue the climatetech company expects to generate during the period for which the company seeks certification, together with a plan that shall include, but shall not be limited to: (A) precise goals and objectives, by which the climatetech company proposes to achieve the projected new state revenue; (B) an estimate of the number of permanent full-time employees to be hired or retained; (C) an estimate of the year in which the company expects to hire or retain the employees; (D) an estimate of the projected average salaries of said employees; (E) an estimate of the projected taxable income pursuant to chapter 62 generated by said employees; (F) an estimate of the methods by which the company shall obtain new employees and pursue a diverse workforce; and (G) if applicable, an estimate of the company's planned capital investment in the commonwealth; and (ii) findings made by the center, based on the certification proposal, documents submitted therewith and any additional investigation by the center that shall be incorporated in its approval, that: (1) the climatetech company is likely to contribute substantially to research, development, innovation, manufacturing, commercialization or deployment of climatetech in the commonwealth; (2) the climatetech company has a substantial likelihood of meeting all statutory requirements and any other criteria that the center may prescribe, including, but not limited to, criteria in the following areas: (A) leveraging additional funding or attracting additional resources to the commonwealth; (B) increasing research, development, innovation, manufacturing, commercialization or deployment of climate technologies within the commonwealth; and (C) creating employment in the commonwealth; and (3) the climatetech company has a substantial likelihood of meeting its state revenue, employment growth and applicable capital investment projections, as specified in the certification proposal, over the period for which it receives benefits.

(c)(1) Certification granted pursuant to subsection (b) shall be valid for 5 years starting with the tax year in which certification is granted. Each certified climatetech company shall file an annual report with the center certifying whether it has met the specific targets established in the proposal pursuant to clause (i) of subsection (b) and, if not, detailing its progress towards those targets.

(2) The certification of a climatetech company may be revoked by the center after an investigation by the center and a determination that the climatetech company is in material noncompliance with its certification proposal; provided, however, that the center shall review said certified climatetech company at least annually. Revocation shall take effect on the first day of the tax year in which the center determines the certified climatetech company to be in material noncompliance. The commissioner of revenue shall, as of the effective date of the revocation, disallow any credits allowed by the original certification of tax benefits under this section. The commissioner of revenue shall issue regulations to establish a process to recapture the value of any credits allowed by the certification under this section. For the purposes of this paragraph, ''material noncompliance'' shall mean the failure of a certified climatetech company to substantially achieve the new state revenue, job growth and capital investment projections set forth in its certification proposal or any other act, omission or misrepresentation by the certified climatetech company that frustrates the public purpose of the climatetech tax incentive program.

(3) Nothing in this subsection shall limit any legal remedies available to the commonwealth against any certified climatetech company.

(d)(1) The center, in consultation with the department of revenue, may annually authorize incentives, including those established in subsections (gg) and (hh) of section 6 of chapter 62, subsection (j) of section 38M of chapter 63, section 38RR of said chapter 63, section 38SS of said chapter 63, section 38TT of said chapter 63, the second paragraph of subsection (c) of section 42B of said chapter 63 and subsection (yy) of section 6 of chapter 64H, that shall not exceed $30,000,000 annually. The center, in consultation with the department of revenue, may limit the incentives to a specific dollar amount or time duration or in any other manner deemed appropriate by the department of revenue; provided, however, that the department of revenue shall only allocate the incentives among certified climatetech companies.

(2) The center, in consultation with the department of revenue, shall provide an estimate to the secretary of administration and finance of the tax cost of extending benefits to a proposed project before certification, as approved by the commissioner of revenue, based on reasonable projections of project activities and costs. Tax incentives shall not be available to a certified climatetech company unless expressly granted by the secretary of administration and finance in writing.