Section 238.395. Development opportunity zones.

 

(1)   Designation of development opportunity zones. The following areas are designated as development opportunity zones:

(a) An area in the city of Beloit, the legal description of which is provided to the corporation by the local governing body of the city of Beloit.

(b) An area in the city of West Allis, the legal description of which is provided to the corporation by the local governing body of the city of West Allis.

(c) An area in the city of Eau Claire, the legal description of which is provided to the corporation by the local governing body of the city of Eau Claire.

(d) An area in the city of Kenosha, the legal description of which is provided to the corporation by the local governing body of the city of Kenosha.

(e) An area in the city of Milwaukee, the legal description of which is provided to the corporation by the local governing body of the city of Milwaukee.

(f) For the Gateway Project, an area in the city of Beloit, the legal description of which is provided to the corporation by the local governing body of the city of Beloit.

(g) An area in the city of Janesville, the legal description of which is provided to the corporation by the local governing body of the city of Janesville.

(h) An area in the city of Kenosha, the legal description of which is provided to the corporation by the local governing body of the city of Kenosha.

(i) An area in the city of Beloit, the legal description of which is provided to the corporation by the local governing body of the city of Beloit.

(2)   Duration, limits and expiration.

(a) Except as provided in par. (d) , the designation of each area under sub. (1) (a) , (b) , and (c) as a development opportunity zone shall be effective for 36 months, with the designation of the areas under sub. (1) (a) and (b) beginning on April 23, 1994, and the designation of the area under sub. (1) (c) beginning on April 28, 1995. Except as provided in par. (d) , the designation of each area under sub. (1) (d) and (e) as a development opportunity zone shall be effective for 84 months, with the designation of the area under sub. (1) (d) beginning on January 1, 2000, and the designation of the area under sub. (1) (e) beginning on September 1, 2001. Except as provided in par. (d) , the designation of the area under sub. (1) (f) as a development opportunity zone shall be effective for 108 months, beginning on September 1, 2001. Except as provided in pars. (d) and (e) , the designation of each area under sub. (1) (g) and (h) as a development opportunity zone shall be effective for 60 months, beginning on the date on which the area is designated under sub. (1) . Except as provided in pars. (d) and (e) , the designation of the area under sub. (1) (i) shall be effective for 60 months, beginning on August 1, 2011.

(b)

1. The limit for tax benefits for the development opportunity zone under sub. (1) (a) is $7,000,000.

2. The limit for tax benefits for the development opportunity zone under sub. (1) (b) is $3,000,000.

3. The limit for tax benefits for the development opportunity zone under sub. (1) (c) is $3,000,000.

4. The limit for tax benefits for the development opportunity zone under sub. (1) (d) is $7,000,000.

5. The limit for tax benefits for the development opportunity zone under sub. (1) (e) is $4,700,000.

6. The limit for tax benefits for the development opportunity zone under sub. (1) (f) is $6,700,000.

7. Except as provided in par. (e) 1. , the limit for tax benefits for the development opportunity zone under sub. (1) (g) is $5,000,000.

8. Except as provided in par. (e) 2. , the limit for tax benefits for the development opportunity zone under sub. (1) (h) is $5,000,000.

9. Except as provided in par. (e) 3. , the limit for tax benefits for the development opportunity zone under sub. (1) (i) is $5,000,000.

(c) Annually, the corporation shall estimate the amount of forgone state revenue because of tax benefits claimed by persons in each development opportunity zone.

(d)

1. Notwithstanding pars. (a) and (e) , the designation of an area as a development opportunity zone shall expire 90 days after the day on which the corporation determines that the forgone tax revenues under par. (c) will equal or exceed the limit for the development opportunity zone.

2. The corporation shall immediately notify the local governing body of the city in which the development opportunity zone is located of a change in the expiration date of the development opportunity zone under this paragraph.

(e)

1. The corporation may extend the designation of an area under sub. (1) (g) as a development opportunity zone for an additional 60 months if the corporation determines that an extension under this subdivision would support economic development within the city. If the corporation extends the designation of the area as a development opportunity zone, the limit for tax benefits for the development opportunity zone under sub. (1) (g) is increased by $5,000,000.

2. The corporation may extend the designation of an area under sub. (1) (h) as a development opportunity zone for an additional 60 months if the corporation determines that an extension under this subdivision would support economic development within the city. If the corporation extends the designation of the area as a development opportunity zone, the limit for tax benefits for the development opportunity zone under sub. (1) (h) is increased by $5,000,000.

3. The corporation may extend the designation of an area under sub. (1) (i) as a development opportunity zone for an additional 60 months if the corporation determines that an extension will support economic development within the city. If the corporation grants an extension under this subdivision, the limit for tax benefits for the development opportunity zone under sub. (1) (i) is increased by $5,000,000.

(3)   Application and entitlement to tax benefits.

(a)

1. Any person that is conducting or that intends to conduct economic activity in a development opportunity zone under sub. (1) (a) or (b) and that, in conjunction with the local governing body of the city in which the development opportunity zone is located, submits a project plan as described in par. (b) to the corporation no later than 6 months after April 23, 1994, shall be entitled to claim tax benefits while the area is designated as a development opportunity zone.

2. Any person that is conducting or that intends to conduct economic activity in a development opportunity zone under sub. (1) (c) and that, in conjunction with the local governing body of the city in which the development opportunity zone is located, submits a project plan as described in par. (b) to the corporation no later than 6 months after April 28, 1995, shall be entitled to claim tax benefits while the area is designated as a development opportunity zone.

3. Any person that is conducting or that intends to conduct economic activity in a development opportunity zone under sub. (1) (d) and that, in conjunction with the local governing body of the city in which the development opportunity zone is located, submits a project plan as described in par. (b) to the corporation no later than July 1, 2000, shall be entitled to claim tax benefits while the area is designated as a development opportunity zone.

4. Any person that is conducting or that intends to conduct economic activity in a development opportunity zone under sub. (1) (e) , (f) , (g) , (h) , or (i) and that, in conjunction with the local governing body of the city in which the development opportunity zone is located, submits a project plan as described in par. (b) to the corporation shall be entitled to claim tax benefits while the area is designated as a development opportunity zone.

(b) A project plan under par. (a) shall include all of the following:

1. The name and address of the person's business for which tax benefits will be claimed.

2. The appropriate federal tax identification number of the person.

3. The names and addresses of other locations outside of the development opportunity zone where the person conducts business and a description of the business activities conducted at those locations.

4. The amount that the person proposes to invest in a business, or spend on the construction, rehabilitation, repair, or remodeling of a building, located within the development opportunity zone.

5. The estimated total investment of the person in the development opportunity zone.

6. The number of full-time jobs that will be created, retained, or substantially upgraded as a result of the person's economic activity in relation to the amount of tax benefits estimated for the person.

7. The person's plans to make reasonable attempts to hire employees from the targeted population.

8. A description of the commitment of the local governing body of the city in which the development opportunity zone is located to the person's project.

9. Other information required by the corporation or the department of revenue.

(d) The corporation annually shall verify information submitted to the corporation under s. 71.07 (2dm) or (2dx) , 71.28 (1dm) or (1dx) , 71.47 (1dm) or (1dx) , or 76.636 .

(4)  The corporation shall revoke the entitlement of a person to claim tax benefits under sub. (3) if the person does any of the following:

(a) Supplies false or misleading information to obtain the tax benefits.

(b) Leaves the development opportunity zone to conduct substantially the same business outside of the development opportunity zone.

(c) Ceases operations in the development opportunity zone and does not renew operation of the trade or business or a similar trade or business in the development opportunity zone within 12 months.

(5)   Certification based on the activity of another.

(a) The corporation may certify for tax benefits a person that is conducting economic activity in the development opportunity zone under sub. (1) (e) or (f) and that is not otherwise entitled to claim tax benefits if all of the following apply:

1. The person's economic activity is instrumental in enabling another person to conduct economic activity in the development opportunity zone under sub. (1) (e) or (f) .

2. The corporation determines that the economic activity of the other person under subd. 1. would not have occurred but for the involvement of the person to be certified for tax benefits under this subsection.

3. The person to be certified for tax benefits under this subsection will pass the benefits through to the other person conducting the economic activity under subd. 1. , as determined by the corporation.

4. The other person conducting the economic activity under subd. 1. does not claim tax benefits under sub. (3) .

(b) A person intending to claim tax benefits under this subsection shall submit to the corporation an application, in the form required by the corporation, containing information required by the corporation and by the department of revenue.

(c) The corporation shall notify the department of revenue of all persons certified to claim tax benefits under this subsection.

(d) The corporation annually shall verify information submitted to the corporation under s. 71.07 (2dm) or (2dx) , 71.28 (1dm) or (1dx) , 71.47 (1dm) or (1dx) , or 76.636 .

(e) The corporation shall revoke the entitlement of a person to claim tax benefits under this subsection if the person does any of the following:

1. Supplies false or misleading information to obtain the tax benefits.

2. Ceases operations in the development opportunity zone under sub. (1) (e) or (f) .

3. Does not pass the benefits through to the other person conducting the economic activity under par. (a) 1. , as determined by the corporation.

(f) The corporation shall notify the department of revenue within 30 days after revoking an entitlement under par. (e) .

1993 a. 232 ; 1995 a. 2 ; 1995 a. 27 ss. 6936p , 6936r , 9130 (4) ; 1997 a. 3 , 27 ; 1999 a. 9 , 32 ; 2001 a. 16 , 104 ; 2003 a. 33 ; 2005 a. 259 ; 2007 a. 20 ; 2009 a. 28 ; 2011 a. 32 s. 3434 ; Stats. 2011 s. 238.395; 2011 a. 37 ss. 2 to 6 ; 2013 a. 166 ss. 52 , 53 , 59 , 76 ; 2015 a. 55 .