HB 466 — Utah Rural Jobs Act Modifications

[(6)] (7)(a)(7) (a) "Excess return" means the difference between:

- 5 - HB0466 compared with HB0466S01 (i) the present value of all growth investments made by a rural investment company on the day the rural investment company applies to exit the program under Section 63N-4-309, including the present value of all distributions and gains from the growth investments;

[(9)] (10)(a)(10) (a) "Full-time employee" means an employee that throughout the year works at -least 530 -hours 1stper Sub.week or meets the customary practices accepted by that industry as full time.

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466 02-20 16:11 least 30 hours per week or meets the customary practices accepted by that industry as full time.

[(10)] (11)(a)(11) (a) "Growth investment" means any capital or equity investment in an eligible small business or any loan made from the investment authority to an eligible small business with a stated maturity at least one year after the date of issuance.

- 6 - HB0466 compared with HB0466S01 [(11)] (12)[(a)](12) [(a)] "High wage" means a wage that:

[(13)] (14)(a)(14) (a) "New annual jobs" means the difference between:

(i)(A)(i) (A) the monthly average of full-time employees that are paid a high wage at an eligible small business for the preceding calendar year;

or (B) if the preceding calendar year contains the initial growth investment, the monthly average of full-timefull- time employees that are paid a high wage at an eligible small business for the months including and after the initial growth investment -and 6before -the 02-20end 16:11of 1stthe Sub.preceding calendar year;

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466 and before the end of the preceding calendar year;

[(16)] (18)(a)(18) - 7 - HB0466 compared with HB0466S01 (a) "Principal business operations" means the location where at least 60% of a business's employees work or where employees that are paid at least 60% of a business's payroll work.

[(20)] (22)(a)(22) (a) "State reimbursement amount" means the difference between:

and -(ii) 7the -product 1stof: Sub.

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466 02-20 16:11 (ii) the product of:

(b) [If] "State reimbursement amount" means zero if the amount calculated in Subsection [[(20)(a)] (20)(a)](22) (22)(a)(a) is less than zero[, the state reimbursement amount is equal to zero].

- 8 - HB0466 compared with HB0466S01 Section 4.

63N-4-30363N-4-303. (Effective 05/06/26).

Application,(Effective 05/06/26)Application, approval, and allocations.

(1)(a)(1) (a) A person seeking approval as a rural investment company shall submit an application to the office.

(b)(i)(b) (i) For the investment authority described in Subsection (6)(a)(i), the office shall begin accepting applications on November 1, 2017.

-(d) 8a -signed 02-20affidavit 16:11from 1steach Sub.claimant that commits to make a credit-eligible capital contribution to the applicant, stating the amount of that commitment;

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466 (d) a signed affidavit from each claimant that commits to make a credit-eligible capital contribution to the applicant, stating the amount of that commitment;

(4)(a)(4) (a) If, after review and evaluation of an application, the office determines that the application does not meet the requirements of Subsection (2), the office shall:

- 9 - HB0466 compared with HB0466S01 (i) deny the application;

or (ii)(A)(ii) (A) notify the applicant that the application was inadequate and allow the applicant to provide additional information to the office to complete, clarify, or cure defects [identified by ]the office identifies in the application;

and (c) notify each claimant whose affidavit was included in the application under Subsection (2) that the claimant qualifies for a tax credit that will be issued in -accordance 9with -Section 1st63N-4-304. Sub.

(Buff)(6) H.B.(a) (i) For the first application period described in Subsection (1)(b)(i), the office may not approve more than $42,000,000 in total investment authority and not more than $24,360,000 in total credit-eligible contributions under this part.

466 02-20 16:11 accordance with Section 63N-4-304.

(6)(a)(i) For the first application period described in Subsection (1)(b)(i), the office may not approve more than $42,000,000 in total investment authority and not more than $24,360,000 in total credit-eligible contributions under this part.

- 10 - HB0466 compared with HB0466S01 (iii) For the third application period described in Subsection (1)(b)(iii), the office may not approve more than $42,000,000 in total investment authority and not more than $24,360,000 in total credit-eligible contributions under this part.

(b) Subject to Subsection (6)(d), if the office approves an application [is approved ]]under under Subsection (5), the office shall approve the amount of investment authority requested on the application.

(c)[(i)](c) [(i)] During [the first] each application period described in Subsection [(1)(b)(i)] (1), the office may continue to accept applications under this section until the amount of approved investment authority reaches $42,000,000.

(c) collect one or more cash investments that, when added to the amounts collected under Subsections (7)(a) and (b), equal the rural investment company's investment -authority; 10 - 02-20 16:11 1st Sub.

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466 authority;

- 11 - HB0466 compared with HB0466S01 (a) the rural investment company's approval shall lapse and the corresponding investment authority and credit-eligible capital contributions shall not count toward the limits on the program size described in Subsection (6);

63N-4-30463N-4-304. (Effective 05/06/26).

Tax(Effective 05/06/26)Tax credit.

(1) On the closing date, a claimant whose affidavit was included in an approved application submitted under Section 63N-4-303 shall earn a vested tax credit equal to the amount of the claimant's credit-eligiblecredit- eligible capital contribution to the rural investment company.

(2)(a){(2) If{If the claimant is an insurer, the claimant may choose to assign the tax credit for any taxable year to an affiliate by providing the office, in a form the office approves:approves:} } (2) (a) {a written notice of intent } If the claimant is an insurer, the claimant may choose to assign the tax credit for any taxable year to an affiliate{;

(i)and} aby writtenproviding noticethe ofoffice, intentin toa assignform the taxoffice creditapproves: to an affiliate;

and(b){(i)} (ii){the the taxable years for which the claimant chooses } a written notice of intent to assign the tax credit.credit{.} to an affiliate;

and {[(2)] (3)} the taxable years for which the claimant chooses to assign the tax credit.

- 12 - HB0466 compared with HB0466S01 (A) each claimantclaimant{ or affiliate} [that received] to which the office issued a tax credit certificate under Subsection [(2)(a)] (3)(a);

and -(B) 11each -affiliate 1stto Sub.which the office issued a tax credit certificate;

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466 02-20 16:11 (B) each affiliate to which the office issued a tax credit certificate;

[(3)] (4)(a)(4) (a) A claimant or affiliate may not claim a tax credit under this section unless the claimant or affiliate has a tax credit certificate[ issued by the office].

63N-4-30563N-4-305. (Effective 05/06/26).

Revocation(Effective 05/06/26)Revocation of tax credit certificates and exit.

- 13 - HB0466 compared with HB0466S01 (b) fails to maintain growth investments in this state equal to 100% of the rural investment company's investment authority until the seventh anniversary [of] after the closing date in accordance with this section;

-(d) 12(i) -with 02-20respect 16:11to 1stphase Sub.one investment authority, fails to maintain growth investments equal to 70% of the rural investment company's investment authority in eligible small businesses that maintain [their] the eligible small businesses' principal business operations in a rural county;

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466 (d)(i) with respect to phase one investment authority, fails to maintain growth investments equal to 70% of the rural investment company's investment authority in eligible small businesses that maintain [their] the eligible small businesses' principal business operations in a rural county;

(2)(a)(i)(2) (a) (i) For the purposes of Subsection (1), an investment is maintained even if the investment is sold or repaid if the rural investment company reinvests an amount equal to the capital returned or recovered by the fund from the original investment, exclusive of any profits realized, in other growth investments in this state within 12 months of the receipt of such capital.

- 14 - HB0466 compared with HB0466S01 (ii) Amounts received periodically by a rural investment company are treated as continually invested in growth investments if the amounts are reinvested in one or more growth investments by the end of the following calendar year.

(b)(i)(b) (i) Subsection (1)(g) does not apply to investments in publicly traded securities by -an 13eligible -small 1stbusiness Sub.or an owner or affiliate of an eligible small business.

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466 02-20 16:11 an eligible small business or an owner or affiliate of an eligible small business.

(3)(a)(3) (a) Before revoking one or more tax credit certificates under this section, the office shall notify the rural investment company of the reasons for the pending revocation.

(a)(i)(a) (i) the rural investment company shall make a cash distribution to the office in an amount equal to the sum of all tax credits awarded to persons that have made credit-eligible contributions to the rural investment company;

and - 15 - HB0466 compared with HB0466S01 (ii) if the rural investment company is able to provide documentation to the office that proves that a tax credit described in Subsection (4)(a)(i) has not been claimed, the amount owed under Subsection (4)(a)(i)(4) (a)(i) shall be reduced by the amount of the unclaimed tax credit;

and -(d) 14the -office 02-20may 16:11award 1stany Sub.remaining investment authority to new applicants.

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466 (d) the office may award any remaining investment authority to new applicants.

63N-4-30763N-4-307. (Effective 05/06/26).

Reporting(Effective 05/06/26)Reporting obligations -- Authorization to disclose tax information -- Credit for new annual jobs.

(1)(a)(1) (a) A rural investment company shall submit an annual report to the office on or before the last day of February for each preceding calendar year until the rural investment company exits the program in accordance with Section 63N-4-309.

[(d)] (iv) unless provided in a previously submitted annual report, for each eligible small business to which the rural investment company provided a growth investment during the preceding calendar - 16 - HB0466 compared with HB0466S01 year, a document that expressly directs and authorizes the State Tax Commission to disclose to the office the eligible small business's returns and other information that would otherwise be subject to confidentiality under Section 59-1-403;

[(2) For the annual report due in 2022, each rural investment company shall submit the documents described in Subsection (1)(d) on or before July 1, 2022.] [(3)] (2)(a)(2) (a) Within 60 days of receipt of an annual report, the office shall provide written confirmation to the rural investment company of the number of new annual jobs the office credited the rural investment company[ has been credited] with for the preceding calendar year.

(b) When granting credit for one or more new annual jobs at an eligible small business -that 15received -or 1stheld Sub.a growth investment from more than one rural investment company during the preceding calendar year, the office shall allocate credit for each new annual job between the rural investment companies:

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466 02-20 16:11 that received or held a growth investment from more than one rural investment company during the preceding calendar year, the office shall allocate credit for each new annual job between the rural investment companies:

[(6)] (5)(a)(5) - 17 - HB0466 compared with HB0466S01 (a) The office shall submit the document described in Subsection [(1)(d)] (1)(b)(iv) to the State Tax Commission.

63N-4-30963N-4-309. (Effective 05/06/26).

Exit.(Effective 05/06/26)Exit.

(1)(a)(1) (a) On or after the seventh anniversary of the closing date, and on or before the twelfth anniversary of the closing date, each rural investment company shall apply to the office to exit the program and no longer be subject to this part.

(b) A rural investment company that receives [phase one investment authority and phase two investment authority ] investment authority from more than one phase shall -separately 16apply -to 02-20exit 16:11the 1stprogram[ Sub.in relation to the phase one investment authority and the phase two investment authority].

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466 separately apply to exit the program[ in relation to the phase one investment authority and the phase two investment authority].

(4)(a)(4) (a) The office shall respond to the application within 30 days [of receipt] after the day on which the office receives the application and include confirmation of the state reimbursement amount.

and - 18 - HB0466 compared with HB0466S01 (b) provide the confirmation described in Subsection (4)(a) within 30 days [of] after the twelfth anniversary of the closing date.

(8) [Any] The office shall deposit amounts collected under this section [shall be deposited ]]into into the General Fund.

-This 17Bill -Repeals: 1st Sub.

(Buff)This H.B.bill repeals:

466 02-20 16:11 This bill repeals:

Effective date.

(1){This } Except as provided in Subsection (2), this bill takes effect {on } May 6, 2026.

2-11-26 2:00 PM - 1819 -