Senator SHIRLEY K. TURNER
District 15 (Hunterdon and Mercer)
Prohibits award of State contracts and development subsidies to inverted domestic corporations.
CURRENT VERSION OF TEXT
An Act prohibiting the award of State contracts and development subsidies to inverted domestic corporations, supplementing Title 52 of the Revised Statutes and amending P.L.2007, c.200.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. (New section) As used in this section, “inverted domestic corporation” means a company that has been determined to be an inverted corporation by the Internal Revenue Service pursuant to section 7874 of the federal Internal Revenue Code (26 U.S.C.s.7874).
An inverted domestic corporation shall be ineligible to be awarded any contract or subcontract for the purchase of goods or services, or any contract or subcontract for the construction or renovation of any public building or facility, that is paid, in whole or in part, with or out of State funds or the funds of any independent State authority. Every corporation seeking to be awarded any such contract or subcontract shall certify in writing that it is not an inverted domestic corporation.
The provisions of this section shall not apply if application thereof would violate any provision of federal law or prevent the receipt of federal funds by the State or a State independent authority.
The State Treasurer shall promulgate, pursuant to the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.), such rules and regulations as may be necessary to effectuate the purposes of this section.
2. Section 4 of P.L.2007, c.200 (C.52:39-4) is amended to read as follows:
4. a. Each applicant for a development subsidy shall submit to the granting body an application for the development subsidy on a form prepared by the State Treasurer. The information required on the application, or in supplements accompanying the application, shall include the following:
(1) An application tracking number provided by the granting body;
(2) The names, street and mailing addresses, and phone numbers of the chief officer of the granting body, the chief officer of the applicant's corporate parent and the applicant, and the street address and three-digit North American Industry Classification System number of the project site;
(3) The start date and the end date, if any, of the development subsidy;
(4) A list of all development subsidies that the applicant is requesting or receiving, the name of any other granting body from which development subsidies are sought or obtained, the value of each development subsidy and the aggregate value of all development subsidies requested or received from all sources;
(5) A signed certification by the chief officer of the recipient corporation that the application is accurate and meets the requirements of [this act] P.L.2007, c.200 (C.52:39-1 et seq.);
(6) The total number of individuals employed by the applicant at the project site on the date of the application, the anticipated number of jobs that will be retained as a result of the development subsidy and the number of new jobs to be created by the applicant at the project site if the development subsidy is granted, broken down by full-time, part-time, and temporary jobs;
(7) The average annual wage and benefit rates of current employees and the anticipated average annual wage and benefit rates of new employees;
(8) The number of current employees provided health benefits, and the number of new employees anticipated to be provided health benefits;
(9) How many of the current employees and how many of the anticipated new employees are represented by a collective bargaining unit;
(10) The average total number of individuals employed in New Jersey during the calendar year preceding the submission of the application by the applicant's corporate parent and all subsidiaries thereof, broken down by full-time, part-time, and temporary jobs;
(11) A statement as to whether the development subsidy may reduce employment at any other site controlled by the applicant or its corporate parent, inside the State, resulting from automation, merger, acquisition, corporate restructuring, or other business activity;
(12) A statement as to whether or not the project involves the relocation of work from another address and if so, the number of jobs to be relocated and the address from which they are to be relocated; [and]
(13) Any other information deemed useful or necessary by the State Treasurer for the implementation of [this act] P.L.2007, c.200 (C.52:39-1 et seq.); and
(14) A standing certificate attesting to the legal status of the applicant.
b. Any granting body, other than the State Treasurer approving the application, shall send a copy to the State Treasurer not more than 15 business days after approval. If the application is not approved, the granting body shall retain the application.
c. A granting body shall not approve an application for a development subsidy if the applicant or its corporate parent became an inverted domestic corporation prior to its application.
d. A recipient corporation shall submit to the granting body a standing certificate attesting to the legal status of the recipient corporation one year after receiving a development subsidy and annually throughout the term of the development subsidy.
e. If a recipient corporation of a development subsidy becomes an inverted domestic corporation during the term of a development subsidy, the recipient corporation shall pay back the total value of the development subsidy.
f. As used in this section, “inverted domestic corporation” means a company that has been determined to be an inverted corporation by the Internal Revenue Service pursuant to section 7874 of the federal Internal Revenue Code (26 U.S.C. s.7874).
(cf: P.L.2007, c.200, s.4)
3. This act shall take effect immediately, but section 2 shall remain inoperative for 60 days following the date of enactment.
This bill prohibits the awarding of any contract that is paid with or out of State funds, or the funds of any independent authority, to an “inverted domestic corporation.”
The bill also prohibits a public entity of the State from granting a development subsidy to an inverted domestic corporation. The bill defines “inverted domestic corporation” as a company that has been determined to be an inverted corporation pursuant to section 7874 of the federal Internal Revenue Code.
The bill would not apply if application thereof violates any federal law or prevents the receipt of federal funds by the State or a State independent authority. The State Treasurer is directed to promulgate rules and regulations to implement the bill’s provisions.
The bill requires the recipient of a State development subsidy to submit to the public granting body, annually during the term of the development subsidy, a standing certificate attesting to the legal status of the recipient corporation operating in this State.
The bill requires a subsidy recipient to pay back the total value of the development subsidy if it becomes an inverted domestic corporation during the term of the subsidy.