Okla. Stat. tit. 68, § 68-3604.1

Application and qualifications.

A. A qualified federal contractor may receive quarterly

incentive payments for renewable ten-year periods from the Oklahoma

Tax Commission pursuant to the provisions of the Oklahoma Quality

Jobs Program Act and the provisions of this section.

B. The amount of such payments shall be equal to a net benefit

rate of not less than twenty-five hundredths of one percent (0.25%),

but not greater than two percent (2%), multiplied by the total

qualified labor hours worked by employees of the federal contractor

or employees of a qualified federal subcontractor, or both, pursuant

to a qualified federal contract for a calendar quarter as verified

by the Oklahoma Employment Security Commission and certified by a

qualified federal contractor verifier. The net benefit rate for a

qualified federal contractor shall be scaled to annual

subcontracting goals that account for both total qualified

subcontract labor hours and the ratio of qualified subcontract labor

hours to total qualified labor hours. Unless limited by the

cost/benefit analysis, the net benefit rate shall:

1. Not exceed twenty-five hundredths of one percent (0.25%)

when annual qualified subcontract labor hours are less than Two

Hundred Thousand Dollars ($200,000.00) or when annual qualified

subcontract labor is less than one percent (1%) of the annual total

qualified labor hours claimed;

2. Not be less than five-tenths of one percent (0.5%) when

subcontract goals are met with a minimum of Two Hundred Thousand

Dollars ($200,000.00) of annual total qualified subcontractor labor

hours and these hours are a minimum of one percent (1%) of the

annual total qualified hours claimed;

3. Not be less than one percent (1%) when subcontract goals are

met with a minimum of One Million Dollars ($1,000,000.00) of annual

Oklahoma Statutes - Title 68. Revenue and Taxation Page 1387

total qualified subcontractor labor hours and when these hours

represent a minimum of five percent (5%) of the annual total

qualified hours claimed;

4. Not be less than one and five-tenths percent (1.5%) when

subcontract goals are met with a minimum of Two Million Dollars

($2,000,000.00) of annual total qualified subcontractor labor hours

and these hours are a minimum of ten percent (10%) of the annual

total qualified hours claimed; and

5. Not be less than two percent (2.0%) when subcontract goals

are met with a minimum of Four Million Dollars ($4,000,000.00) of

annual total qualified subcontractor labor hours and these hours are

a minimum of twenty percent (20%) of the annual total qualified

hours claimed.

C. In order to receive incentive payments, a qualified federal

contractor shall apply to the Oklahoma Department of Commerce within

one hundred eighty (180) days following the date of the award of a

qualified federal contract or award of a new qualified subcontract

under an existing qualified federal contract. The application shall

be on a form prescribed by the Department and shall contain such

information as may be required by the Department to determine if the

applicant is qualified. Once qualified by the Department, the

applicant shall submit qualified federal contracts to the federal

contract verifier. The federal contract verifier shall establish

with the applicant an information system(s) or contract(s) as may be

required to certify the total qualified labor hours, qualified labor

rates, and reimbursement through the qualified federal contract. A

qualified federal contractor may apply for an effective date for a

project, which shall not be more than twenty-four (24) months from

the date the application is submitted to the Department. No state

agency shall be required to make any payment to a qualified federal

contract verifier for any information needed by the agency to

perform any duty imposed upon it pursuant to the provisions of

Section 3601 et seq. of this title. All costs for the federal
for a

project, which shall not be more than twenty-four (24) months from

the date the application is submitted to the Department. No state

agency shall be required to make any payment to a qualified federal

contract verifier for any information needed by the agency to

perform any duty imposed upon it pursuant to the provisions of

Section 3601 et seq. of this title. All costs for the federal

contract verifier shall be reimbursed through value-added services

on the qualified federal contract or other mechanisms agreed to by

the federal contractor verifier and the federal contract performers.

D. In order to qualify to receive incentive payments as

authorized by the Oklahoma Quality Jobs Program Act, in addition to

other qualifications specified herein, a qualified federal

contractor shall be required to pay direct jobs an average

annualized wage which equals or exceeds:

1. One hundred ten percent (110%) of the average county wage as

determined by the Department of Commerce based on the most recent

U.S. Department of Commerce data for the county in which the new

direct jobs are located. For purposes of this paragraph, health

care premiums paid by the applicant for individuals in new direct

jobs shall be included in the annualized wage; or

Oklahoma Statutes - Title 68. Revenue and Taxation Page 1388

2. One hundred percent (100%) of the average county wage as

that percentage is determined by the Department of Commerce based

upon the most recent U.S. Department of Commerce data for the county

in which the new jobs are located. For purposes of this paragraph,

health care premiums paid by the applicant for individuals in new

direct jobs shall not be included in the annualized wage.

Provided, no average wage requirement shall exceed Twenty-nine

Thousand Four Hundred Nine Dollars ($29,409.00), in any county.

This maximum wage threshold shall be indexed and modified from time

to time based on the latest Consumer Price Index year-to-date

percent change release as of the date of the annual average county

wage data release from the Bureau of Economic Analysis of the U.S.

Department of Commerce.

3. For qualified subcontractor work, the qualified federal

contractor shall have a minimum average qualified labor rate

requirement paid to the subcontractor of Thirty-one Dollars ($31.00)

per hour, in any county. This maximum wage threshold shall be

indexed and modified from time to time based on the latest Consumer

Price Index year-to-date percent change release as of the date of

the annual average county wage data release from the Bureau of

Economic Analysis of the U.S. Department of Commerce.

E. The Department shall determine if the applicant is qualified

to receive incentive payments using information supplied to the

Department by the qualified federal contractor verifier. The NAICS

code or codes under which the federal government awarded the

qualified federal contract shall be used to determine the basic

industry for a qualified federal contractor. For federal contracts

awarded under NAICS codes not within the definition of basic

industry pursuant to paragraph 1 of subsection A of Section 3603 of

this title, the Department of Commerce, with the federal contract

verifier, may evaluate and utilize individual statement of work

items that would qualify within a basic industry definition.

F. If the applicant is determined to be qualified by the

Department, the Department shall conduct a cost/benefit analysis to

determine the estimated net direct state benefits and the net

benefit rate, as provided by subsection B of this section,

applicable for a ten-year period beginning with the first complete

calendar quarter following the start date and to estimate the amount

of gross payroll and total qualified labor hours for a ten-year

period beginning with the first complete calendar quarter following

the start date. In conducting such cost/benefit analysis, the
e net

benefit rate, as provided by subsection B of this section,

applicable for a ten-year period beginning with the first complete

calendar quarter following the start date and to estimate the amount

of gross payroll and total qualified labor hours for a ten-year

period beginning with the first complete calendar quarter following

the start date. In conducting such cost/benefit analysis, the

Department shall consider quantitative factors, such as the

anticipated level of new tax revenues to the state along with the

added cost to the state of providing services, and such other

criteria as deemed appropriate by the Department. In no event shall

incentive payments, cumulatively, exceed the estimated net direct

state benefits. Using this net cost/benefit analysis model, the

Oklahoma Statutes - Title 68. Revenue and Taxation Page 1389

Department may establish the renewable ten-year contract with a

qualified federal contractor at the entity level to encompass any

current or future qualified federal contracts that meet the

cost/benefit analysis metrics as determined by the federal

contractor verifier and confirmed by the Department.

G. Upon approval of such an application, the Department shall

notify the Tax Commission and shall provide it with a copy of the

contract that has been cosigned by the federal contractor verifier

and the results of the cost/benefit analysis. The Tax Commission

may require the qualified federal contractor, federal contract

verifier, and qualified subcontractors to submit such additional

information as may be necessary to administer the provisions of the

Oklahoma Quality Jobs Program Act. The approved qualified federal

contractor shall file quarterly claims with the Tax Commission and

shall continue to file such quarterly claims during the ten-year

incentive period to show its continued eligibility for incentive

payments, as provided in Section 3606 of this title, or until it is

no longer qualified to receive incentive payments. The qualified

federal contractor may be audited by the Tax Commission to verify

such eligibility. Once the qualified federal contractor is

approved, an agreement shall be deemed to exist between the

qualified federal contractor and the State of Oklahoma, requiring

the continued incentive payment to be made as long as the qualified

federal contractor retains its eligibility as defined in and

established pursuant to this section and Sections 3603 and 3606 of

this title and within the limitations contained in the Oklahoma

Quality Jobs Program Act, which existed at the time of such

approval.

H. For qualified federal contracts with periods of performance

exceeding two (2) years, if the actual annual verified gross

qualified labor hours for four (4) consecutive calendar quarters

does not equal or exceed Two Million Five Hundred Thousand Dollars

($2,500,000.00) within three (3) years of the start date, or does

not equal or exceed actual annual gross qualified labor hours of Two

Million Five Hundred Thousand Dollars ($2,500,000.00) at any other

time during the ten-year period after the start date, the incentive

payments shall not be made and shall not be resumed until such time

as the actual annual qualified labor hours exceed Two Million Five

Hundred Thousand Dollars ($2,500,000.00).

I. If the average annualized wage or minimum average qualified

labor rate required by subsection H of this section is not met

during any calendar quarter, the incentive payments shall not be

made and shall not be resumed until such time as such requirements

are met.

J. Before approving a quarterly incentive payment for a

qualified federal contract, the federal contract verifier must first

determine through the Department that neither the qualified federal

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contractor nor the subcontractor are receiving incentive payments

under the Oklahoma Quality Jobs Program Act, the Saving Quality Jobs
met.

J. Before approving a quarterly incentive payment for a

qualified federal contract, the federal contract verifier must first

determine through the Department that neither the qualified federal

Oklahoma Statutes - Title 68. Revenue and Taxation Page 1390

contractor nor the subcontractor are receiving incentive payments

under the Oklahoma Quality Jobs Program Act, the Saving Quality Jobs

Act, the 21st Century Quality Jobs Incentive Act or the Former

Military Facility Development Act for the performance of the same

such services under the qualified federal contract and is not

qualified for approval of an application for incentive payments

under the Oklahoma Quality Jobs Program Act, the Saving Quality Jobs

Act, the 21st Century Quality Jobs Incentive Act or the Former

Military Facility Development Act for the performance of the same

such services under the qualified federal contract. If the

qualified federal contractor or the subcontractor are receiving or

have an approved application for incentive payments under the

Oklahoma Quality Jobs Program Act, the Saving Quality Jobs Act, the

21st Century Quality Jobs Incentive Act or the Former Military

Facility Development Act for the performance of the same such

services under the qualified federal contract, each may choose to

defer in part or in entirety the other incentives for the qualified

federal contractor to receive the incentives pursuant to subsection

B of this section. The federal contract verifier shall confirm any

deferrals and ensure the total for all quality jobs incentive

payments on any individual does not exceed the total net benefit to

the state. Should neither the federal contractor nor the

subcontractor defer in part or in entirety their incentive payments

such that the total for all Quality Jobs incentive payments exceeds

the total net benefit to the state, the priority for incentive

payments shall go to the entity with the earliest recognized start

date indentified within the current Department of Commerce Quality

Jobs contract.