§ 37.165 DEFINITIONS.

   For the purposes of this subchapter, the following definitions shall apply unless the context clearly indicates or requires a different meaning.

   CAPITAL ASSETS. Tangible and intangible personal property which is subject to depreciation or amortization under §§ 167 and 168 of the Internal Revenue Code of 1986, as amended to the date of adoption of this ordinance.

   CONSTRUCTION COMMENCEMENT. The date earth is first excavated for the purpose of constructing a new business facility.

   DEPARTMENT. The finance department of the city.

   FINANCE DIRECTOR. The finance director of the city.

   NEW BUSINESS FACILITY. A new building or structure that is part of a project that satisfies the requirements of § 37.167 and is not ineligible under the provisions of § 37.168.

   PERSON. Any individual, firm, partnership, joint venture, association, limited liability company, limited liability partnership, corporation, trust or any group or combination thereof acting as a unit.

   PROJECT. The construction, equipping and furnishing of a new business facility at a single site, and for which the commencement of construction or the ordering of equipment to be used in a new business facility occurred on or after April 11, 2005.

   SALES TAX. The sales and service and use taxes imposed by the city pursuant to §§ 37.001 and 37.002.

(1992 Code, § 39-172) (Ord. 42-05, passed 4-18-2005; Ord. 60-07, passed 5-7-2007)

§ 37.166 REFUND OF RETAIL SALES AND SERVICE TAX AND USE TAX ON CAPITAL ASSETS.

   (a)   As provided in this subchapter, any person may apply for and obtain a refund or credit for sales tax paid by the person on the costs incurred in the furnishing and equipping of a new business facility that satisfies all requirements of this subchapter. Except as provided in the last sentence of this division (a), the refund allowed under this section pertains only to project costs incurred and paid within 36 months of the approval of the application required by § 37.169. Upon a showing of good cause, the time limits prescribed by this section may be extended by the finance director for a period not to exceed 24 months. The refund shall not apply to capital assets purchased to replace capital assets for which a refund has been claimed during this 36-month period or extended period. There is no refund if the person fails to make application with the finance director as set forth in § 37.169.

   (b)   The 30-day advance application requirement found in § 37.169 shall not apply to any project for which the commencement of construction or the ordering of equipment occurs between April 11, 2005, and the effective date of this subchapter. However, all projects shall submit an application to the finance director within 30 days of the effective date of the subchapter and receive the finance director’s approval prior to receiving a refund.

   (c)   Those businesses which otherwise were eligible to receive a refund of retail sales and service tax and use tax on capital assets, and missed the deadline set forth in the previous division (b) above, shall be allowed to submit an application for refund of retail sales and service tax and use tax on capital assets by June 1, 2006. If the applications are received by the city finance department by June 1, 2006, they will be deemed to have been timely filed.

(1992 Code, § 39-173) (Ord. 42-05, passed 4-18-2005; Ord. 38-06, passed 4-3-2006; Ord. 60-07, passed 5-7-2007)

§ 37.167 ELIGIBLE PROJECTS.

   No refund may be made unless:

   (a)   The project includes new construction that adds at least $5,000,000 in taxable value to the city’s property tax base, or an investment in non-realty capital assets of not less than $10,000,000, or if the combination of new construction and non-realty capital assets exceeds $10,000,000;

   (b)   The facility is used directly in:

         A.   The manufacture or processing or fabricating or compounding of personal property which is intended to be sold or leased for final use consumption;

         B.   Data processing, hosting and related services including payroll services, financial transactions processing as those terms are defined by 2002 NAICS; or

         C.   Research and development in the:

            1.   Social sciences;

            2.   Humanities; and

            3.   Physical, engineering and life sciences as those terms are defined by 2002 NAICS.

   (c)   The person makes application for the refund from the finance director as set forth in § 37.169; and

   (d)   The project is not ineligible under § 37.168.

(1992 Code, § 39-174) (Ord. 42-05, passed 4-18-2005; Ord. 60-07, passed 5-7-2007)

§ 37.168 INELIGIBLE PROJECTS.

   A project shall not be eligible for tax refunds under this subchapter if it is:

   (a)   Used predominantly for the sale of products at retail to individual consumers;

   (b)   Used predominantly for residential housing or transient lodging;

   (c)   Used predominantly to provide health care services; or

   (d)   Not subject to ad valorem real property taxation or equivalent taxes measured by gross receipts.

(1992 Code, § 39-175) (Ord. 42-05, passed 4-18-2005; Ord. 60-07, passed 5-7-2007)

§ 37.169 APPLICATION FOR REFUND.

   Any person desiring to claim a refund pursuant to this subchapter shall make application to the finance director at least 30 days prior to the earlier of the construction commencement or the ordering of equipment to be used in a new business facility. The application shall be submitted on a form prescribed by the finance director. A separate application shall be submitted for each project. Upon the finance director’s approval of the application, the finance director shall notify the applicant that he or she is eligible to submit refund claims and to receive refunds as provided in this subchapter. Refund claims are not assignable or transferable except as collateral or security pursuant to SDCL ch. 57A-9.

(1992 Code, § 39-176) (Ord. 42-05, passed 4-18-2005; Ord. 60-07, passed 5-7-2007)

§ 37.170 AMOUNT OF REFUND.

   The refund shall be 100% of the sales taxes paid to the city with respect to the project. The person receiving a refund shall be entitled to retain 100% of the amount refunded if the project remains in operation in the city for at least five years. If the project ceases operation in the city before the end of the five-year period, the city shall be entitled to repayment of all or a portion of the amount refunded, the refund being prorated based upon the time remaining in the five-year minimum term. Any amount the city is entitled to recover under this section shall constitute a debt to the city and a lien in favor of the city upon all property and rights to property whether real or personal belonging to the claimant and may be recovered in an action of the debt.

(1992 Code, § 39-177) (Ord. 42-05, passed 4-18-2005; Ord. 60-07, passed 5-7-2007)