The Quality Jobs, or QJ, program provides a cash rebate to companies that create well-paid jobs and promote economic development.
- The Program provides a 5% or 6% cash rebate of annual gross payroll for new, direct jobs for up to 10 years.
- Could provide a 4% sales/use tax rebate on capital expenditures or a 1.5% investment tax credit for qualified expenses.
Business must be in one of the following industries:
- Bioscience, Manufacturing, Software, Environmental Technology, Food Technology, Advanced Materials or Oil & Gas Field Service
- Must have at least 50% of annual sales out-of-state and/or to in-state customers or buyers if the product or service is resold by the purchaser to an out-of-state customer or buyer or to the federal government.
- Must be located in an area designated by Louisiana Economic Development as a distressed region. A distressed region is either of the following:
- A parish that is within the lowest 25% of parishes based on per capita income.
- A census tract block group that is below the state median per capita income, based upon the latest federal decennial census.
The following employers or persons shall not be eligible to participate in the program:
- Retail employers identified by NAICS Code Sections 44 and 45
- Business associations and professional organizations identified by NAICS Code 8139
- State and local government enterprises
- Real estate agents, operators and lessors
- Automotive rental and leasing
- Local solid waste disposal, local sewage systems and local water systems businesses
- Nonprofit organizations, unless the department determines that the new direct jobs created by the organization would have a significant impact on Louisiana
- Employers engaged in the gaming industry identified by NAICS Code sections 713210 and 721120
- Create a minimum of five new direct jobs
- These jobs must be full time, (full-time employees — working 30 hours or greater per week)
- Provide a basic health benefit plan/health insurance coverage
- That which is required to be offered and/or provided shall include coverage for basic hospital care, coverage for physician care and coverage for health care which shall be the same as that provided to executive, administrative or professional employees
- Coverage must become effective no later than the first day of the month 90 days after the date of hire
- The employer's contribution must have a value of at least one dollar and twenty-five cents per hour. If you are other than a self-insured company, the value of the plan is the actual cost for the individual coverage. If you are a self-insured company, LED will determine the value. Basic health care benefits do not include dental, vision or life.
Minimum Wage and Health Care Requirements.
- The minimum wage requirement for new direct jobs is $14.50 per hour in wages and healthcare benefits
Minimum Annual Gross Payroll Requirements
If an employer employs:
- 50 or fewer employees state-wide prior to the start date of the contract, the minimum annual payroll threshold for new direct jobs is $250,000
- More than 50 employees statewide prior to the start date of the contract, the minimum annual payroll threshold for new direct jobs is $500,000
If the actual verified annual gross payroll for the employer's third fiscal year does not show a minimum of five new direct jobs and does not equal or exceed a total annual payroll for new direct jobs of either $500,000 or $250,000, whichever is applicable, the employer will be determined to be ineligible.
If seeking sales and use tax rebates or the investment tax credit, in addition to meeting the requirements of the Quality Jobs Program an employer must meet the hiring requirements as defined in the Enterprise Zone Program:
- Create a minimum of five permanent net new full-time jobs within 24 months of their project start date or increase their current statewide workforce by 10% within the first 12 months
- Hire at least 50% of all net new jobs from one or more of the following targeted groups:
- Residency. Someone living in Enterprise Zone with the state.
- Lacking basic skills. A person performing below a ninth-grade proficiency in reading, writing or mathematics.
After the department receives your advance notification and fee, you are ready to start your project, including the following:
1. Begin your project. This includes construction, hiring, purchasing equipment, building and materials and other capital investments.
2. File for an Unemployment Insurance Identification Number (UI#). Contact the Louisiana Workforce Commission (LWC) to apply for an unemployment identification number.
3. Submit your program application within 18 months after the first new direct job is hired, however, no more than 24 months after the department has received the advance notification and fee. Submit the Minimum Insurance Requirement document with your application.
4. LED review of application and Board approval. Once LED receives your application and fee, the office staff will review your application for compliance with the program rules and provide a copy of the application to the Louisiana Workforce Commission (LWC) and Louisiana Department of Revenue (LDR) for review. An application will not be presented to the board until a letter of no objection is received. Completed applications are due for review no later than the 15th of the month prior to the Board meeting date. Applicants are notified within 10 days of the Board date and are provided instructions, time and location of the meeting.
5. Board Review. Your application is presented to the Board of Commerce and Industry for approval. The Board convenes every other month, meeting six times during a calendar year.
6. Issue contract. After the application is approved by the Board of Commerce and Industry, three original contracts will be sent for signature, unless the Louisiana Department of Revenue (LDR) or the LWC issues an objection against the project and/or owner(s).
7. Submit Annual Certification Report (ACR) and supporting documentation. The initial ACR(s) is due within 6 months after the close of your fiscal filing year or after the Governor's signature, whichever comes later.
Use appropriate form specific to your contract:
- Baseline Spreadsheet
- Annual Report Spreadsheet (Pre-Act 387)
- Annual Report Spreadsheet (Act 387)
- Certification of Primary Qualification (Pre-Act 387)
- Certification of Primary Qualification (Act 387)
- ACR-Health Care Certification Form
- Initial Baseline Calculation Worksheet
- Disclosure Authorization
Only if seeking sales and use tax rebates or the investment tax credit, in addition to meeting the requirements of the Quality Jobs Program an employer must meet the hiring requirements as defined in the Enterprise Zone:
1. After submitting the advance notification and fee, apply for local benefits by contacting the local governing authority to request an endorsement resolution.
2. File for a Sales/Use Tax Certificate Registration. Contact the Louisiana Department of Revenue to apply for sales and use tax registration certificate and taxpayer account number.
3. Submit Project Completion Report (PCR) within 3 months after the project is completed.
4. Submit the Affidavit of Final Cost (AFC) within 6 months of the completion of the project.
5. File for sales and use tax rebate or refundable investment tax credit with Louisiana Department of Revenue.
6. File Employee Certification Reports (ECR). Reports are due by May 31st after the project has been completed (for project period of 24 months or less).
Only if seeking an additional sales and use tax rebate or investment tax credit period (remember, an employer must also meet the hiring requirements as defined in the Enterprise Zone Program):
1. Submit the Advance Notification Quality Jobs Additional Period - Sales and Use Tax / ITC before beginning the additional project period.
2. Submit the Application Sales and Use Tax/Investment Tax Credit (Additional Period) within 3 months after the project is complete. (Remember that the project period cannot exceed 30 months.)
3. File Employee Certification Reports. These reports are due in conjunction with the Application for this additional period.
4. Submit the Project Completion Report within 3 months after the project is completed.
5. Submit the Affidavit of Final Cost (AFC) within 6 months of the completion of the project.
6. File for sales and use tax rebate or refundable investment tax credit. Submit rebate claim or refundable ITC request to the Louisiana Department of Revenue within 6 months after the project has been completed. You must complete additional forms issued by the LDR. Contact Office of Audit Division at 225.219.2270 for additional information.
Q: If I am an existing business in Louisiana with multiple facilities located throughout the state and I reduce the workforce at one site and increase the workforce at another site with a Quality Jobs (QJ) contract, would those jobs created at the QJ site be eligible as net new jobs?
A: Possibly. A business has to create new direct jobs for the state of Louisiana. A new direct job is a position created on or after the contract effective date, which is in addition to the number of jobs in the employment baseline established statewide including affiliates that meet the minimum requirements of the program. For example:
- If a business reduces its workforce by 50 employees at one site and adds 50 jobs at another site, then there is no new net gain of jobs to the state.
- On the other hand, if a business reduces its workforce by 25 jobs at one site and increases the workforce by 50 jobs at the QJ site, then there is a net increase to the state.
Q: If Company ABC purchased Company XYZ and retained XYZ's employees, are the retained jobs considered net new jobs?
A: NO. When a business acquires another business the jobs that were at the acquired business are not considered new jobs to the state for the new business owner. There must be a net increase of new jobs to the state. For example:
- Company A Manufacturers, Inc. has acquired Company B, Inc., a local company with 15 existing employees. Company A Manufacturers, Inc. plans to make some modifications to the structure of Company B, Inc., and retains their employees. The 15 employees retained by Company A Manufacturers, Inc., are not considered net new jobs to the state.
Q: Under a QJ contract, businesses are eligible to receive payroll rebates and either the sales and use tax rebate or the investment tax credit if, in addition to meeting the QJ requirements, a business must also meet the hiring requirements of the Enterprise Zone Program. If I do not meet the minimum requirements of both programs, do I lose all the benefits offered under the QJ program?
A: Possibly. The QJ Program offers a payroll rebate on gross annual payroll for net new jobs. As long as the company meets the requirements of the QJ program they can still receive that benefit. For example:
- If the company meets both program requirements (QJ and EZ) under its QJ contract, then both benefits can be received by the company.
- If the company meets only the QJ requirements under its QJ contract, then the payroll benefits can be enjoyed.
- If a company meets only the hiring requirements of the Enterprise Zone program under its QJ contract, then the company is not eligible for either benefit.
- If a company meets neither program requirement, then they are not eligible for either benefit.
Q: What is the Quality Jobs Program?
A: The Quality Jobs (QJ) Program provides payroll benefits as an inducement for businesses to locate or expand operations in the State of Louisiana.
Q: What are the benefits of the program?
A: It provides a rebate of up to 6% on annual wages for up to 10 years and the election of either a 4% sales/use tax rebate on capital expenditures or a 1.5% investment tax credit for qualifying expenses if additional requirements are met. Sales/use taxes can be rebated during a 30 month "project/construction" period.
Q: What is a Quality Jobs contract?
A: The Quality Jobs Contract is an agreement between the State of Louisiana and a qualified company that allows the company to receive the benefits of the QJ Program upon meeting all of the program requirements.
Q: How do I enter into a Quality Jobs contract?
A: Advance Notification — Filing an Advance Notification is the first step in the process. The Advance Notification can be filed through FastLane. The Advance Notification must be filed before hiring, purchasing or construction begins.
Application — An application for the Quality Jobs Program must be filed on the prescribed forms within 18 months after the first new direct job is hired, however, no more than 24 months after the department has received the advance notification and fee. Upon receipt of the application, fee, and addendum material, the application is reviewed by LED. Once accepted, the application is processed and presented at the next Board of Commerce and Industry meeting.
Contract — After the Board of Commerce and Industry approves the application, a contract is mailed to the applicant for signature (three originals, to be signed before two witnesses and returned). The contract is then sent to the Board of Commerce and Industry and finally to the Governor for signature.
Q: What is an Advance Notification?
A: The Advance Notification is the document notifying LED of a project before any action has occurred, such as hiring new employees or spending money.
Q: After a contract is executed, what documents are necessary to receive the benefits of the program?
A: The company must file the following documents with LED after the close of each fiscal year during the contract period:
- The Annual Certification Report (ACR) and the required addendum material, including a copy of the wage reports filed with the Louisiana Workforce Commission (ES4's) and information about the employee health care plan (coverage summary and cost detail) Certification of Primary Qualification illustrating the company's eligibility for the program
- The Rebate Spreadsheet illustrating the new direct jobs created
- The Baseline Report illustrating that the company has maintained the baseline jobs that existed prior to the start date of the contract.
* Additional information may be required. These forms can be found on LED's website.
* LED will notify the Louisiana Department of Revenue (LDR) of the company's eligibility; the company must then file with LDR to receive the rebate.
Q: What is the earliest date I can start my contract?
A: The earliest contract start date is the date LED receives the Advance Notification and fee.
Q: How long is the contract effective?
A: The contract is effective for five years and may be renewed for an additional five years.
Q: Can I participate in the Quality Jobs Program and the Enterprise Zone Program at the same time?
A: No, you cannot participate in both programs at the same time.
Q: What is the difference in benefits between Quality Jobs and Enterprise Zone?
A: The Enterprise Zone Program provides a one-time job tax credit on each new direct job, and the Quality Jobs Program provides up to a 6% payroll rebate on annual payroll for new direct jobs for up to 10 years. Both programs offer sales and use tax rebate or the investment tax credit.
Q: If I originally applied for Enterprise Zone and later decide to apply for Quality Jobs (or vice versa), can you do so using the same Advance Notification?
A: Yes, an email or letter addressed to the program managers reflecting the change would suffice, provided that the election is made before the application due date.
Q: What are the requirements for the sales and use tax rebates or the investment tax credit?
A: In addition to meeting the requirements of the Quality Jobs Program, the applicant must meet the hiring requirements as defined in the Enterprise Zone Program:
- Five new direct jobs within the first 24 months of the project period or increase its current workforce by 10% within the first 12 months of the project period.
- 50% of all jobs created during the project period must meet at least one of the four hiring requirements defined in the Enterprise Zone Program.
Q: What is the minimum number of new direct jobs that need to be created?
A: At least five new direct jobs must be created by the end of the third fiscal year of the contract.
Q: What is a new direct job?
A: A new direct job is a job or position that did not exist in the State of Louisiana prior to the start date of the contract and meets the requirements of the QJ program. For instance:
- If a company is expanding its workforce by creating 10 new jobs at the contract site, as long as those jobs are created after the start date of the contract and meet the minimum requirements (wages, health care, etc), then those jobs are considered new direct jobs.
- If Company A has a contract to perform services or supply goods in the State and then loses that contract to Company B to supply similar services or goods in the State, then any job gains at Company B associated with the contract change would not be considered new direct jobs.
- If Company A has 20 Louisiana employees and buys Company B, which has an existing QJ contract, then those 20 employees would not be considered new direct jobs. Similarly, if Company A buys Company B, who has 10 Louisiana employees, then those 10 employees would not be considered new direct jobs. If a company or its affiliate within the State of Louisiana has multiple locations in the State, the transferring of employees from one location to another is not considered a new direct job.
Q: What are the minimum wage requirements of the program?
A: The minimum wage requirement for new direct jobs is $14.50 per hour in wages and health care benefits. The health care plan must have a minimum value of at least $1.25 per hour for individual coverage.
Q: How do I calculate the value of the health care plan?
A1: If the company purchases health care insurance, the value of the plan is the company's actual cost for individual coverage (employee single). (If the applicant feels that the value of their plan is greater than the cost, a valuation may be performed. However, based on historical reviews, it is rare that the value would differ materially from the actual cost.)
A2: For a self-insured company, LED will determine the value through comparison with the cost of plans providing similar benefits (consulting with an insurance industry expert as needed).
Q: What are the minimum payroll requirements of the program?
- For applicants with 50 or less employees state-wide prior to the contract effective date, the minimum annual gross payroll threshold for new direct jobs is $250,000.
- For applicants with 51 or more employees state-wide prior to the contract effective date, the minimum annual gross payroll threshold for new direct jobs is $500,000.
*If the actual verified annual gross payroll for the employer's third fiscal year does not show a minimum of five new direct jobs and does not equal or exceed a total annual payroll for new direct jobs of either $500,000 or $250,000, whichever is applicable, the employer will be determined to be ineligible.
Q: If the employer pays an employee $13.25/hour in wages and the employee does not elect the eligible health care plan valued at least $1.25/hour, would this meet the minimum wage requirement?
A: Yes, provided that at least fifty percent of the employees holding new direct jobs accept the health care benefits offered: however, only the wage portion is eligible for rebates.
Q: What is an in-state contract?
A: An in-state contract is a contract to perform services or supply goods that involves Louisiana jobs, including contracts associated with serving or supplying goods to certain offshore or out-of-state locations. For instance:
- A contract to deliver services or goods to a Louisiana location is considered an in-state contract. This includes contracts with public or private entities that are located outside of the State (e.g., contracts with global companies for their Louisiana locations, contracts with the Federal Government for a Louisiana location)./li>
- A contract to deliver services or goods to an out-of-state location for which services and goods have historically been provided from Louisiana (e.g., provided by Louisiana facilities near state borders) is considered an in-state contract.
- A contract to perform services for or supply goods to an offshore Gulf of Mexico facility in an area that has historically been served from Louisiana (e.g., served from Port Fourchon) is considered an in-state contract.
Q: What is a baseline employee?
A: The median statewide number of employees of an employer, including affiliates working at the average hours per week, during the payroll periods including the twelfth day of the month in the last four months completed prior to the contract effective date. (The median is calculated by discarding the months with the highest and lowest number of employees and averaging the number in the remaining two months.) Four months of operation to use the median average are needed, otherwise if three or less months of operation with employment prior to the contract effective date, average only the months with employment.
Q: Are there any local benefits?
A: Rebate of some local sales/use taxes paid is available at the discretion of the local governing authority in the parish in which the project is located. The local governing authority must submit an Endorsement Resolution to the Board of Commerce & Industry prior to Board action on the Company's application. For more information on local rebates, please contact the local governing authority where your business is located.
Q: Louisiana Domicile, what is it and how can I prove it?
A: Although a person can have multiple residences, they can only have one domicile. The determination of domicile can be quite complex, requiring living in Louisiana for at least six months out of the year, plus evidence of intent to remain here permanently. Domicile can be inferred from a totality of a person's actions and can be supported by documents such as a voter registration card or filing of Resident Tax Return IT 540.
Q: What is an Endorsement Resolution?
A: An Endorsement Resolution is a written motion issued by the local governing authority supporting a company's participation in the Quality Jobs Program that states the percentage of local sales tax to be rebated to the company.
Q: Who is the Board of Commerce & Industry?
A: The Board, composed of individuals appointed by the Governor of Louisiana, reviews and approves applications for certain tax incentive programs, including Enterprise Zone, Industrial Tax Exemption, Quality Jobs and Restoration Tax Abatement.
- Submit Advance Notification with fee either online or by mail, then begin the project.
- File for an Unemployment Insurance ID number with the Louisiana Workforce Commission.
- Complete the application on LED's website and submit any required addendum materials to LED for review.
- LED reviews application and submits it to the Board of Commerce and Industry.
- If approved, the Board issues contract through LED.
- Submit Project Completion Report to LED.
- File for annual payroll rebate with LED.
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