{"data":{"id":"us-ok/okla.-stat.-tit.-68-68-3603","jurisdiction":"us-ok","citation":"Okla. Stat. tit. 68, § 68-3603","heading":"Definitions","body":"A. As used in the Oklahoma Quality Jobs Program Act:\n\n1. a. “Basic industry” means:\n\n(1) those manufacturing activities defined or\n\nclassified in the NAICS Manual under Industry\n\nSector Nos. 31, 32 and 33, Industry Group No.\n\n5111 or Industry No. 11331,\n\n(2) those electric power generation, transmission and\n\ndistribution activities defined or classified in\n\nthe NAICS Manual under U.S. Industry Nos. 221111\n\nthrough 221122, if:\n\n(a) an establishment engaged therein qualifies\n\nas an exempt wholesale generator as defined\n\nby 15 U.S.C., Section 79z-5a,\n\n(b) the exempt wholesale generator facility\n\nconsumes from sources located within the\n\nstate at least ninety percent (90%) of the\n\ntotal energy used to produce the electrical\n\noutput which qualifies for the specialized\n\ntreatment provided by the Energy Policy Act\n\nof 1992, P.L. 102-486, 106 Stat. 2776, as\n\namended, and federal regulations adopted\n\npursuant thereto,\n\n(c) the exempt wholesale generator facility\n\nsells to purchasers located outside the\n\nstate for consumption in activities located\n\noutside the state at least ninety percent\n\n(90%) of the total electrical energy output\n\nwhich qualifies for the specialized\n\ntreatment provided by the Energy Policy Act\n\nof 1992, P.L. 102-486, 106 Stat. 2776, as\n\namended, and federal regulations adopted\n\npursuant thereto, and\n\n(d) the facility is constructed on or after July\n\n1, 1996,\n\n(3) those administrative and facilities support\n\nservice activities defined or classified in the\n\nNAICS Manual under Industry Group Nos. 5611 and\n\n5612, Industry Nos. 51821, 519130, 52232 and\n\n56142 or U.S. Industry Nos. 524291 and 551114,\n\nthose other support activities for air\n\ntransportation defined or classified in the NAICS\n\nManual under Industry Group No. 488190, and those\n\nsupport, repair, and maintenance service\n\nactivities for the wind industry defined or\n\nclassified in the NAICS Manual under Industry\n\nGroup No. 811310,\n\n(4) those professional, scientific and technical\n\nservice activities defined or classified in the\n\nNAICS Manual under U.S. Industry Nos. 541710 and\n\n541380,\n\n(5) distribution centers for retail or wholesale\n\nbusinesses defined or classified in the NAICS\n\nManual under Sector No. 42, if forty percent\n\n(40%) or more of the inventory processed through\n\nsuch warehouse is shipped out-of-state,\n\n(6) those adjustment and collection service\n\nactivities defined or classified in the NAICS\n\nManual under U.S. Industry No. 561440, if\n\nseventy-five percent (75%) of the loans to be\n\nserviced were made by out-of-state debtors,\n\n(7) (a) those air transportation activities defined\n\nor classified in the NAICS Manual under\n\nIndustry Group No. 4811, if the following\n\nfacilities are located in this state:\n\n(i) the corporate headquarters of an\n\nestablishment classified therein, and\n\n(ii) a facility or facilities at which\n\nreservations for transportation\n\nprovided by such an establishment are\n\nprocessed, whether such services are\n\nperformed by employees of the\n\nestablishment, by employees of a\n\nsubsidiary of or other entity\n\naffiliated with the establishment or by\n\nemployees of an entity with whom the\n\nestablishment has contracted for the\n\nperformance of such services; provided,\n\nthis provision shall not disqualify an\n\nestablishment which uses an out-of-\n\nstate entity or employees for some\n\nreservations services, or\nes are\n\nperformed by employees of the\n\nestablishment, by employees of a\n\nsubsidiary of or other entity\n\naffiliated with the establishment or by\n\nemployees of an entity with whom the\n\nestablishment has contracted for the\n\nperformance of such services; provided,\n\nthis provision shall not disqualify an\n\nestablishment which uses an out-of-\n\nstate entity or employees for some\n\nreservations services, or\n\n(b) those air transportation activities defined\n\nor classified in the NAICS Manual under\n\nIndustry Group No. 4811, if an establishment\n\nclassified therein has or will have within\n\none (1) year sales of at least seventy-five\n\npercent (75%) of its total sales, as\n\ndetermined by the Incentive Approval\n\nCommittee pursuant to the provisions of\n\nsubsection B of this section, to out-of-\n\nstate customers or buyers, to in-state\n\ncustomers or buyers if the product or\n\nservice is resold by the purchaser to an\n\nout-of-state customer or buyer for ultimate\n\nuse, or to the federal government,\n\n(8) flight training services activities defined or\n\nclassified in the NAICS Manual under U.S.\n\nIndustry Group No. 611512, which for purposes of\n\nthe Oklahoma Quality Jobs Program Act shall\n\ninclude new direct jobs for which gross payroll\n\nexisted on or after January 1, 2003, as\n\nidentified in the NAICS Manual,\n\n(9) the following, if an establishment classified\n\ntherein has or will have within one (1) year\n\nsales of at least seventy-five percent (75%) of\n\nits total sales, as determined by the Incentive\n\nApproval Committee pursuant to the provisions of\n\nsubsection B of this section, to out-of-state\n\ncustomers or buyers, to in-state customers or\n\nbuyers if the product or service is resold by the\n\npurchaser to an out-of-state customer or buyer\n\nfor ultimate use, or to the federal government:\n\n(a) those transportation and warehousing\n\nactivities defined or classified in the\n\nNAICS Manual under Industry Subsector No.\n\n493, if not otherwise listed in this\n\nparagraph, Industry Subsector Nos. 482 and\n\n484 and Industry Group Nos. 4884 through\n\n4889,\n\n(b) those passenger transportation activities\n\ndefined or classified in the NAICS Manual\n\nunder Industry Nos. 561510 and 561599,\n\n(c) those freight or cargo transportation\n\nactivities defined or classified in the\n\nNAICS Manual under Industry No. 541614,\n\n(d) those insurance activities defined or\n\nclassified in the NAICS Manual under\n\nIndustry Group No. 5241,\n\n(e) those services to dwellings and other\n\nbuildings, as defined or classified in the\n\nNAICS Manual under Industry Group No. 5617,\n\nexcluding U.S. Industry Nos. 561730, 56171,\n\n56172, 56174 and 56179,\n\n(f) those equipment rental and leasing\n\nactivities defined or classified in the\n\nNAICS Manual under Industry Group No. 5324,\n\n(g) those information technology and other\n\ncomputer-related service activities defined\n\nor classified in the NAICS Manual under\n\nIndustry Group Nos. 5112, 5182, 5191 and\n\n5415,\n\n(h) those business support service activities\n\ndefined or classified in the NAICS Manual\n\nunder U.S. Industry Nos. 561410 through\n\n561430, excluding 56143, and Industry No.\n\n51911,\n\n(i) those medical and diagnostic laboratory\n\nactivities defined or classified in the\n\nNAICS Manual under Industry Group No. 6215,\n\n(j) those professional, scientific and technical\n\nservice activities defined or classified in\n\nthe NAICS Manual under Industry Group Nos.\n\n5412, 5414, 5415, 5416 and 5417, Industry\n\nNos. 54131, 54133, 54136 and 54137, and U.S.\n\nIndustry No. 541990, if not otherwise listed\n\nin this paragraph,\n\n(k) those communication service activities\n\ndefined or classified in the NAICS Manual\n\nunder Industry Nos. 51741 and 51791,\nional, scientific and technical\n\nservice activities defined or classified in\n\nthe NAICS Manual under Industry Group Nos.\n\n5412, 5414, 5415, 5416 and 5417, Industry\n\nNos. 54131, 54133, 54136 and 54137, and U.S.\n\nIndustry No. 541990, if not otherwise listed\n\nin this paragraph,\n\n(k) those communication service activities\n\ndefined or classified in the NAICS Manual\n\nunder Industry Nos. 51741 and 51791,\n\n(l) those refuse systems activities defined or\n\nclassified in the NAICS Manual under\n\nIndustry Group No. 5622, provided that the\n\nestablishment is primarily engaged in the\n\ncapture and distribution of methane gas\n\nproduced within a landfill,\n\n(m) general wholesale distribution of groceries,\n\ndefined or classified in the NAICS Manual\n\nunder Industry Group Nos. 4244 and 4245,\n\n(n) those activities relating to processing of\n\ninsurance claims, defined or classified in\n\nthe NAICS Manual under U.S. Industry Nos.\n\n524210 and 524292; provided, activities\n\ndescribed in U.S. Industry Nos. 524210 and\n\n524292 in the NAICS Manual other than\n\nprocessing of insurance claims shall not be\n\nincluded for purposes of this subdivision,\n\n(o) those agricultural activities classified in\n\nthe NAICS Manual under U.S. Industry Nos.\n\n112120 and 112310,\n\n(p) those professional organization activities\n\nclassified in the NAICS Manual under U.S.\n\nIndustry No. 813920,\n\n(q) alternative energy structure construction\n\nclassified in the NAICS Manual under U.S.\n\nIndustry No. 237130,\n\n(r) solar reflective coating application\n\nclassified in the NAICS Manual under U.S.\n\nIndustry No. 238160,\n\n(s) solar heating equipment installation\n\nclassified in the NAICS Manual under U.S.\n\nIndustry No. 238220,\n\n(t) those wired telecommunications carriers\n\nclassified in the NAICS Manual under U.S.\n\nIndustry No. 517110, and\n\n(u) those securities, commodity contracts and\n\ninvestment activities classified in the\n\nNAICS Manual under Industry Subsector No.\n\n523,\n\n(10) those activities related to extraction or\n\npipeline transportation of petroleum, natural gas\n\nor refined petroleum products, defined or\n\nclassified in the NAICS Manual under Industry\n\nGroup No. 2111, 213111, 213112 or 486, subject to\n\nthe limitations provided in paragraph 3 of this\n\nsubsection and paragraph 3 of subsection B of\n\nthis section,\n\n(11) those activities performed by the federal\n\ncivilian workforce at a facility of the Federal\n\nAviation Administration located in this state if\n\nthe Director of the Oklahoma Department of\n\nCommerce determines or is notified that the\n\nfederal government is soliciting proposals or\n\notherwise inviting states to compete for\n\nadditional federal civilian employment or\n\nexpansion of federal civilian employment at such\n\nfacilities,\n\n(12) those activities defined or classified in the\n\nNAICS Manual under U.S. Industry No. 711211 (2007\n\nversion),\n\n(13) those real estate or brokerage activities\n\nclassified in the NAICS Manual under U.S.\n\nIndustry No. 53120 for which at least seventy-\n\nfive percent (75%) of the establishment’s\n\nrevenues are attributed to out-of-state sales and\n\nat least seventy-five percent (75%) of the real\n\nestate transactions generating those revenues are\n\nattributed to real property located outside the\n\nState of Oklahoma, or\n) those real estate or brokerage activities\n\nclassified in the NAICS Manual under U.S.\n\nIndustry No. 53120 for which at least seventy-\n\nfive percent (75%) of the establishment’s\n\nrevenues are attributed to out-of-state sales and\n\nat least seventy-five percent (75%) of the real\n\nestate transactions generating those revenues are\n\nattributed to real property located outside the\n\nState of Oklahoma, or\n\n(14) those support activities for rail transportation\n\nand those support activities for water\n\ntransportation defined or classified in the NAICS\n\nManual under U.S. Industry Nos. 4882 and 4883.\n\nb. An establishment described in subparagraph a of this\n\nparagraph shall not be considered to be engaged in a\n\nbasic industry unless it offers, or will offer within\n\none hundred eighty (180) days of employment, a basic\n\nhealth benefits plan to the individuals it employs in\n\nnew direct jobs in this state which is determined by\n\nthe Oklahoma Department of Commerce to consist of the\n\nfollowing elements or elements substantially\n\nequivalent thereto:\n\n(1) not more than fifty percent (50%) of the premium\n\nshall be paid by the employee,\n\n(2) coverage for basic hospital care,\n\n(3) coverage for physician care,\n\n(4) coverage for mental health care,\n\n(5) coverage for substance abuse treatment,\n\n(6) coverage for prescription drugs, and\n\n(7) coverage for prenatal care;\n\n2. “Change-in-control event” means the transfer to one or more\n\nunrelated establishments or unrelated persons, of either:\n\na. beneficial ownership of more than fifty percent (50%)\n\nin value and more than fifty percent (50%) in voting\n\npower of the outstanding equity securities of the\n\ntransferred establishment, or\n\nb. more than fifty percent (50%) in value of the assets\n\nof an establishment.\n\nA transferor shall be treated as related to a transferee if more\n\nthan fifty percent (50%) of the voting interests of the transferor\n\nand transferee are owned, directly or indirectly, by the other or\n\nare owned, directly or indirectly, by the same person or persons,\n\nunless such transferred establishment has an outstanding class of\n\nequity securities registered under Sections 12(b) or 15(d) of the\n\nSecurities Exchange Act of 1934, as amended, in which event the\n\ntransferor and transferee will be treated as unrelated; provided, an\n\nestablishment applying for the Oklahoma Quality Jobs Program Act as\n\na result of a change-in-control event is required to apply within\n\none hundred eighty (180) days of the change-in-control event to\n\nqualify for consideration. An establishment entering the Oklahoma\n\nQuality Jobs Program Act as the result of a change-in-control event\n\nshall be required to maintain a level of new direct jobs as agreed\n\nto in its contract with the Oklahoma Department of Commerce and to\n\npay new direct jobs an average annualized wage which equals or\n\nexceeds one hundred twenty-five percent (125%) of the average county\n\nwage as that percentage is determined by the Oklahoma Department of\n\nCommerce based upon the most recent U.S. Department of Commerce data\n\nfor the county in which the new jobs are located. For purposes of\n\nthis paragraph, healthcare premiums paid by the applicant for\n\nindividuals in new direct jobs shall not be included in the\n\nannualized wage. Such establishment entering the Oklahoma Quality\n\nJobs Program Act as the result of a change-in-control event shall be\n\nrequired to retain the contracted average annualized wage and\n\nmaintain the contracted maintenance level of new direct jobs numbers\n\nas certified by the Tax Commission. If the required average\n\nannualized wage or the required new direct jobs numbers do not equal\n\nor exceed such contracted level during any quarter, the quarterly\n\nincentive payments shall not be made and shall not be resumed until\n\nsuch time as such requirements are met. An establishment described\nntain the contracted maintenance level of new direct jobs numbers\n\nas certified by the Tax Commission. If the required average\n\nannualized wage or the required new direct jobs numbers do not equal\n\nor exceed such contracted level during any quarter, the quarterly\n\nincentive payments shall not be made and shall not be resumed until\n\nsuch time as such requirements are met. An establishment described\n\nin this paragraph shall be required to repay all incentive payments\n\nreceived under the Oklahoma Quality Jobs Program Act if the\n\nestablishment is determined by the Tax Commission to no longer have\n\nbusiness operations in the state within three (3) years from the\n\nbeginning of the calendar quarter for which the first incentive\n\npayment claim is filed;\n\n3. “New direct job”:\n\na. means full-time-equivalent employment in this state in\n\nan establishment which has qualified to receive an\n\nincentive payment pursuant to the provisions of the\n\nOklahoma Quality Jobs Program Act which employment did\n\nnot exist in this state prior to the date of approval\n\nby the Department of the application of the\n\nestablishment pursuant to the provisions of Section\n\n3604 of this title and with respect to an\n\nestablishment qualifying for incentive payments\n\npursuant to division (12) of subparagraph a of\n\nparagraph 1 of this subsection shall not include\n\ncompensation paid to an employee or independent\n\ncontractor for an athletic contest conducted in the\n\nstate if the compensation is paid by an entity that\n\ndoes not have its principal place of business in the\n\nstate or that does not own real or personal property\n\nhaving a market value of at least One Million Dollars\n\n($1,000,000.00) located in the state, and the\n\nemployees or independent contractors of such entity\n\nare compensated to compete against the employees or\n\nindependent contractors of an establishment that\n\nqualifies for incentive payments pursuant to division\n\n(12) of subparagraph a of paragraph 1 of this\n\nsubsection and which is organized under Oklahoma law\n\nor that is lawfully registered to do business in the\n\nstate and which does have its principal place of\n\nbusiness located in the state and owns real or\n\npersonal property having a market value of at least\n\nOne Million Dollars ($1,000,000.00) located in the\n\nstate; provided, that if an application of an\n\nestablishment is approved by the Oklahoma Department\n\nof Commerce after a change-in-control event and the\n\nDirector of the Oklahoma Department of Commerce\n\ndetermines that the jobs located at such establishment\n\nare likely to leave the state, “new direct job” shall\n\ninclude employment that existed in this state prior to\n\nthe date of application which is retained in this\n\nstate by the new establishment following a change in\n\ncontrol event, if such job otherwise qualifies as a\n\nnew direct job, and\n\nb. shall include full-time-equivalent employment in this\n\nstate of employees who are employed by an employment\n\nagency or similar entity other than the establishment\n\nwhich has qualified to receive an incentive payment\n\nand who are leased or otherwise provided under\n\ncontract to the qualified establishment, if such job\n\ndid not exist in this state prior to the date of\n\napproval by the Department of the application of the\n\nestablishment or the job otherwise qualifies as a new\n\ndirect job following a change-in-control event. The\n\nleasing of employees by the establishment or employees\n\nprovided under contract with an establishment shall\n\nconstitute an employer-employee relationship between\n\nthose employees and the establishment. A job shall be\n\ndeemed to exist in this state prior to approval of an\n\napplication if the activities and functions for which\n\nthe particular job exists have been ongoing at any\n\ntime within six (6) months prior to such approval.\n\nWith respect to establishments defined in division\nth an establishment shall\n\nconstitute an employer-employee relationship between\n\nthose employees and the establishment. A job shall be\n\ndeemed to exist in this state prior to approval of an\n\napplication if the activities and functions for which\n\nthe particular job exists have been ongoing at any\n\ntime within six (6) months prior to such approval.\n\nWith respect to establishments defined in division\n\n(10) of subparagraph a of paragraph 1 of this\n\nsubsection, new direct jobs shall be limited to those\n\njobs directly comprising the corporate headquarters of\n\nor directly relating to manufacturing, maintenance,\n\nadministrative, financial, engineering, surveying,\n\ngeological or geophysical services performed by the\n\nestablishment. Under no circumstances shall\n\nemployment relating to field services be considered\n\nnew direct jobs;\n\n4. “Estimated direct state benefits” means the tax revenues\n\nprojected by the Department to accrue to the state as a result of\n\nnew direct jobs;\n\n5. “Estimated direct state costs” means the costs projected by\n\nthe Department to accrue to the state as a result of new direct\n\njobs. Such costs shall include, but not be limited to:\n\na. the costs of education of new state resident children,\n\nb. the costs of public health, public safety and\n\ntransportation services to be provided to new state\n\nresidents,\n\nc. the costs of other state services to be provided to\n\nnew state residents, and\n\nd. the costs of other state services;\n\n6. “Estimated net direct state benefits” means the estimated\n\ndirect state benefits less the estimated direct state costs;\n\n7. “Net benefit rate” means the estimated net direct state\n\nbenefits computed as a percentage of gross payroll; provided:\n\na. except as otherwise provided in this paragraph, the\n\nnet benefit rate may be variable and shall not exceed\n\nfive percent (5%),\n\nb. the net benefit rate shall not exceed six percent (6%)\n\nin connection with an establishment which is owned and\n\noperated by an entity which has been awarded a United\n\nStates Department of Defense contract for which:\n\n(1) bids were solicited and accepted by the United\n\nStates Department of Defense from facilities\n\nlocated outside this state,\n\n(2) the term is or is renewable for not less than\n\ntwenty (20) years, and\n\n(3) the average annual salary, excluding benefits\n\nwhich are not subject to Oklahoma income taxes,\n\nfor new direct jobs created as a direct result of\n\nthe awarding of the contract is projected by the\n\nOklahoma Department of Commerce to equal or\n\nexceed Forty Thousand Dollars ($40,000.00) within\n\nthree (3) years of the date of the first\n\nincentive payment,\n\nc. except as otherwise provided in subparagraph d of this\n\nparagraph, in no event shall incentive payments,\n\ncumulatively, exceed the estimated net direct state\n\nbenefits,\n\nd. the net benefit rate shall be five percent (5%) for an\n\nestablishment locating:\n\n(1) in an opportunity zone located in a high-\n\nemployment county, as such terms are defined in\n\nsubsection G of Section 3604 of this title, or\n\n(2) in a county in which:\n\n(a) the per capita personal income, as\n\ndetermined by the Department, is eighty-five\n\npercent (85%) or less of the statewide\n\naverage per capita personal income,\n\n(b) the population has decreased over the\n\nprevious ten (10) years, as determined by\n\nthe Oklahoma Department of Commerce based on\n\nthe most recent U.S. Department of Commerce\n\ndata, or\n\nr capita personal income, as\n\ndetermined by the Department, is eighty-five\n\npercent (85%) or less of the statewide\n\naverage per capita personal income,\n\n(b) the population has decreased over the\n\nprevious ten (10) years, as determined by\n\nthe Oklahoma Department of Commerce based on\n\nthe most recent U.S. Department of Commerce\n\ndata, or\n\n(c) the unemployment rate exceeds the lesser of\n\nfive percent (5%) or two percentage points\n\nabove the state average unemployment rate as\n\ncertified by the Oklahoma Employment\n\nSecurity Commission,\n\ne. the net benefit rate shall not exceed six percent (6%)\n\nin connection with an establishment which:\n\n(1) is, as of the date of application, receiving\n\nincentive payments pursuant to the Oklahoma\n\nQuality Jobs Program Act and has been receiving\n\nsuch payments for at least one (1) year prior to\n\nthe date of application, and\n\n(2) expands its operations in this state by creating\n\nadditional new direct jobs which pay average\n\nannualized wages which equal or exceed one\n\nhundred fifty percent (150%) of the average\n\nannualized wages of new direct jobs on which\n\nincentive payments were received during the\n\npreceding calendar year,\n\nf. with respect to an establishment defined or classified\n\nin the NAICS Manual under U.S. Industry No. 711211\n\n(2007 version) or any establishment defined or\n\nclassified in the NAICS Manual as a U.S. Industry\n\nNumber which is not included within the definition of\n\n“basic industry” as such term is defined in this\n\nsection on April 17, 2008, the net benefit rate shall\n\nnot exceed the highest rate of income tax imposed upon\n\nthe Oklahoma taxable income of individuals pursuant to\n\nsubparagraph (g) or subparagraph (h), as applicable,\n\nof paragraph 1 and paragraph 2 of subsection B of\n\nSection 2355 of this title. Any change in such\n\nhighest rate of individual income tax imposed pursuant\n\nto the provisions of Section 2355 of this title shall\n\nbe applicable to the computation of incentive payments\n\nto an establishment as described by this subparagraph\n\nand shall be effective for purposes of incentive\n\npayments based on payroll paid by such establishment\n\non or after January 1 of any applicable year for which\n\nthe net benefit rate is modified as required by this\n\nsubparagraph, and\n\ng. the net benefit rate shall not exceed six percent (6%)\n\nin connection with an establishment which employs\n\nUnited States military veterans in at least ten\n\npercent (10%) of its gross payroll. The net benefit\n\nrate for an establishment which employs United States\n\nmilitary veterans in at least ten percent (10%) of its\n\npayroll shall not be lower than five percent (5%).\n\nIncentive payments made pursuant to the provisions of this\n\nsubparagraph shall be based upon payroll associated with such new\n\ndirect jobs. For purposes of this subparagraph, the amount of\n\nhealth insurance premiums or other benefits paid by the\n\nestablishment shall not be included for purposes of computation of\n\nthe average annualized wage;\n\n8. “Gross payroll” means wages, as defined in Section 2385.1 of\n\nthis title for new direct jobs;\n\n9. a. “Establishment” means any business or governmental\n\nentity, no matter what legal form, including, but not\n\nlimited to, a sole proprietorship; partnership;\n\nlimited liability company; corporation or combination\n\nof corporations which have a central parent\n\ncorporation which makes corporate management decisions\n\nsuch as those involving consolidation, acquisition,\n\nmerger or expansion; federal agency; political\n\nsubdivision of the State of Oklahoma; or trust\n\nauthority; provided, distinct, identifiable subunits\n\nof such entities may be determined to be an\n\nestablishment, for all purposes of the Oklahoma\n\nQuality Jobs Program Act, by the Department subject to\n\nthe following conditions:\nmanagement decisions\n\nsuch as those involving consolidation, acquisition,\n\nmerger or expansion; federal agency; political\n\nsubdivision of the State of Oklahoma; or trust\n\nauthority; provided, distinct, identifiable subunits\n\nof such entities may be determined to be an\n\nestablishment, for all purposes of the Oklahoma\n\nQuality Jobs Program Act, by the Department subject to\n\nthe following conditions:\n\n(1) within three (3) years of the first complete\n\ncalendar quarter following the start date, the\n\nentity must have a minimum payroll of Two Million\n\nFive Hundred Thousand Dollars ($2,500,000.00) and\n\nthe subunit must also have or will have a minimum\n\npayroll of Two Million Five Hundred Thousand\n\nDollars ($2,500,000.00),\n\n(2) the subunit is engaged in an activity or service\n\nor produces a product which is demonstratively\n\nindependent and separate from the entity’s other\n\nactivities, services or products and could be\n\nconducted or produced in the absence of any other\n\nactivity, service or production of the entity,\n\n(3) has an accounting system capable of tracking or\n\nfacilitating an audit of the subunit’s payroll,\n\nexpenses, revenue and production. Limited\n\ninterunit overlap of administrative and\n\npurchasing functions shall not disqualify a\n\nsubunit from consideration as an establishment by\n\nthe Department,\n\n(4) the entity has not previously had a subunit\n\ndetermined to be an establishment pursuant to\n\nthis section; provided, the restriction set forth\n\nin this division shall not apply to subunits\n\nwhich qualify pursuant to the provisions of\n\nsubparagraph b of paragraph 7 of this subsection,\n\nand\n\n(5) it is determined by the Department that the\n\nentity will have a probable net gain in total\n\nemployment within the incentive period.\n\nb. The Department may promulgate rules to further limit\n\nthe circumstances under which a subunit may be\n\nconsidered an establishment. The Department shall\n\npromulgate rules to determine whether a subunit of an\n\nentity achieves a net gain in total employment. The\n\nDepartment shall establish criteria for determining\n\nthe period of time within which such gain must be\n\ndemonstrated and a method for determining net gain in\n\ntotal employment;\n\n10. “NAICS Manual” means any manual, book or other publication\n\ncontaining the North American Industry Classification System, United\n\nStates, 1997, promulgated by the Office of Management and Budget of\n\nthe United States of America, or the latest revised edition;\n\n11. “Qualified federal contract” means a contract between an\n\nagency or instrumentality of the United States government, including\n\nbut not limited to the Department of Defense or any branch of the\n\nUnited States Armed Forces, but exclusive of any contract performed\n\nfor the Federal Emergency Management Agency as a direct result of a\n\nnatural disaster declared by the Governor or the President of the\n\nUnited States with respect to damage to property located in Oklahoma\n\nor loss of life or personal injury to persons in Oklahoma, and a\n\nlawfully recognized business entity, whether or not the business\n\nentity is organized under the laws of the State of Oklahoma or\n\nwhether or not the principal place of business of the business\n\nentity is located within the State of Oklahoma, for the performance\n\nof services, including but not limited to testing, research,\n\ndevelopment, consulting or other services in a basic industry, if\n\nthe contract involves the performance of such services performed on\n\nor after July 1, 2009, by the employees of the business entity\n\nwithin the State of Oklahoma or if the contract involves the\n\nperformance of such services performed on or after July 1, 2009, by\n\nemployees of a lawfully recognized business entity that is a\n\nsubcontractor of the business entity with which the prime contract\n\nhas been formed. A qualified federal contract described in this\n\nparagraph shall not qualify unless both the qualified federal\nness entity\n\nwithin the State of Oklahoma or if the contract involves the\n\nperformance of such services performed on or after July 1, 2009, by\n\nemployees of a lawfully recognized business entity that is a\n\nsubcontractor of the business entity with which the prime contract\n\nhas been formed. A qualified federal contract described in this\n\nparagraph shall not qualify unless both the qualified federal\n\ncontractor and any subcontractors originally involved in the work or\n\nadded subsequently during the period of performance verify to the\n\nqualified federal contractor verifier that it offers, or will offer\n\nwithin one hundred eighty (180) days of employment of its respective\n\nemployees, a basic health benefits plan as described in subparagraph\n\nb of paragraph 1 of this subsection to individuals who perform\n\nqualified labor hours in this state;\n\n12. “Qualified federal contractor verifier” means a nonprofit\n\nentity organized under the laws of the State of Oklahoma, having an\n\naffiliation with a comprehensive university which is part of The\n\nOklahoma State System of Higher Education, and having the following\n\ncharacteristics:\n\na. established multiyear classified and unclassified\n\nindefinite-delivery/indefinite-quantity federal\n\ncontract vehicles in excess of Fifty Million Dollars\n\n($50,000,000.00),\n\nb. current capability to sponsor and maintain personnel\n\nsecurity clearances and authorized by the federal\n\ngovernment to handle and perform classified work up to\n\nthe Top Secret Sensitive Compartmented Information\n\nlevels,\n\nc. at least one on-site federally certified Sensitive\n\nCompartmented Information Facility,\n\nd. on-site secure mass data storage complex with the\n\ncapability of isolating, segregating and protecting\n\ncorporate proprietary and classified information,\n\ne. trusted agent status by maintaining no ownership of,\n\nvested interest in, nor royalty production from any\n\nintellectual property,\n\nf. at least one hundred thousand (100,000) square feet of\n\nconfigurable laboratory and support space,\n\ng. the direct access to restricted air space through a\n\nformalized memorandum of agreement with the Department\n\nof Defense,\n\nh. at least five thousand (5,000) acres available for\n\noutdoor testing and training facilities, and\n\ni. the ability to house state-of-the-art surety\n\nfacilities, including chemical, biological,\n\nradiological, explosives, electronics, and unmanned\n\nsystems laboratories and ranges;\n\n13. “SIC Manual” means the 1987 revision to the Standard\n\nIndustrial Classification Manual, promulgated by the Office of\n\nManagement and Budget of the United States of America;\n\n14. “Start date” means the date on which an establishment may\n\nbegin accruing benefits for the creation of new direct jobs, which\n\ndate shall be determined by the Department;\n\n15. “Effective date” means the date of approval of a contract\n\nunder which incentive payments will be made pursuant to the Oklahoma\n\nQuality Jobs Program Act, which shall be the date the signed and\n\naccepted incentive contract is received by the Department; provided,\n\nan approved project may have a start date which is different from\n\nthe effective date;\n\n16. “Total qualified labor hours” means the reimbursed payment\n\namount for hours of work performed by the State of Oklahoma\n\nworkforce of a qualified federal contractor or the State of Oklahoma\n\nworkforce of a subcontractor of a qualified federal contractor and\n\nwhich are required for the full performance of a qualified federal\n\ncontract;\n\n17. “Qualified labor rate” means the fully reimbursed labor\n\nrate paid through a qualified federal contract for qualified labor\n\nhours to the qualified federal contractor or subcontractor;\n\n18. “Qualified federal contractor” means a business entity:\n\na. maintaining a prime contract with the federal\n\ngovernment as defined in paragraph 11 of this\n\nsubsection,\nmance of a qualified federal\n\ncontract;\n\n17. “Qualified labor rate” means the fully reimbursed labor\n\nrate paid through a qualified federal contract for qualified labor\n\nhours to the qualified federal contractor or subcontractor;\n\n18. “Qualified federal contractor” means a business entity:\n\na. maintaining a prime contract with the federal\n\ngovernment as defined in paragraph 11 of this\n\nsubsection,\n\nb. providing notice of intent to apply to the Department\n\nwithin one hundred eighty (180) days of July 1, 2010,\n\nor one hundred eighty (180) days of the date of the\n\naward of a qualified federal contract or award of a\n\nnew qualified subcontract under an existing qualified\n\nfederal contract, and\n\nc. adding substantively to the contract by performing at\n\nleast eight percent (8%) of the total labor whether\n\nqualified and nonqualified labor as determined by the\n\nfederal contractor verifier on a direct contract or\n\nindividual task order or delivery order on an\n\nindefinite-delivery/indefinite-quantity or other\n\nblanket contract vehicle.\n\nShould a prime contractor provide notice to the Department of\n\nits intent not to apply for incentive for a qualified federal\n\ncontract or fails to qualify under the criteria above,\n\nsubcontractors in order of tier ranking as determined by the federal\n\ncontract verifier may assume the role of the prime and apply to\n\nbecome a qualified federal contractor provided the entity meets the\n\nsame criteria above with the exception that notice of intent to\n\napply with the Department must be provided within sixty (60) days of\n\nthe prime’s disqualification or one hundred eighty (180) days of the\n\naward of its subcontract, whichever is later; and\n\n19. “Proxy establishment” means a public trust which:\n\na. is organized and existing under Section 176 of Title\n\n60 of the Oklahoma Statutes for the benefit of a\n\ngeographic area which includes a city or county or\n\nsome combination thereof, and\n\nb. benefits a geographic area where new direct jobs which\n\nmeet the requirements of the Oklahoma Quality Jobs\n\nProgram Act are created by an establishment, other\n\nthan the proxy establishment, which is a branch of the\n\nArmed Forces of the United States.\n\nA proxy establishment may be determined to be an establishment\n\nfor all purposes of the Oklahoma Quality Jobs Program Act by the\n\nDepartment and incentive payments may be made to such proxy\n\nestablishment for new direct jobs otherwise qualified pursuant to\n\nthe Oklahoma Quality Jobs Program Act. The Department may\n\npromulgate rules to further specify the circumstances under which a\n\nproxy establishment may be considered an establishment for the\n\npurposes of making application for incentive payments pursuant to\n\nthe Oklahoma Quality Jobs Program Act. Provided however, that with\n\nrespect to any data on qualifying direct new jobs from a branch of\n\nthe Armed Forces of the United States, such rules shall only require\n\na proxy establishment to provide such data as would otherwise be\n\npublicly releasable by the branch of the Armed Forces of the United\n\nStates.\n\nB. The Incentive Approval Committee is hereby created and shall\n\nconsist of the Director of the Office of Management and Enterprise\n\nServices, the Director of the Department and one member of the\n\nOklahoma Tax Commission appointed by the Tax Commission, or a\n\ndesignee from each agency approved by such member. It shall be the\n\nduty of the Committee to determine the eligibility of all applicants\n\nfor the Oklahoma Quality Jobs Program Act, subject to the applicable\n\nrequirements.\n\nC. For an establishment defined as a “basic industry” pursuant\n\nto division (4) of subparagraph a of paragraph 1 of subsection A of\n\nthis section, the Incentive Approval Committee shall consist of the\n\nmembers provided by subsection B of this section and the Executive\n\nDirector of the Oklahoma Center for the Advancement of Science and\nity Jobs Program Act, subject to the applicable\n\nrequirements.\n\nC. For an establishment defined as a “basic industry” pursuant\n\nto division (4) of subparagraph a of paragraph 1 of subsection A of\n\nthis section, the Incentive Approval Committee shall consist of the\n\nmembers provided by subsection B of this section and the Executive\n\nDirector of the Oklahoma Center for the Advancement of Science and\n\nTechnology, or a designee from the Center appointed by the Executive\n\nDirector.","path":["OK Code","Title 68"],"source_url":"https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os68.pdf","current_through":"2026-08-14","vintage":"open-us-law v2026.08, retrieved 2026-09-14","retrieved_at":"2026-09-14T18:32:36Z","sha256":"67673f0312abe427c695e93429f36e417cbdc6ae07e1cf220f18b52530135646","source_id":"us-ok","stale":false,"prev":"us-ok/okla.-stat.-tit.-68-68-3602","next":"us-ok/okla.-stat.-tit.-68-68-3604"},"notice":"GroundRules: Original legal text. Not legal advice."}