A BILL TO BE ENTITLED
AN ACT to amend the FILM INDUSTRY Development Account; TO AMEND THE CONDEMNATION AUTHORITY OF NORTH CAROLINA RAILROADS; TO ESTABLISH a graduated rate structure for the corporate income tax; and to amend provisions relating to industrial and pollution control facilities financing.
The General Assembly of North Carolina enacts:

Part 1.  Film Industry Incentives

SECTION 1.1.  G.S. 143B‑434.3(a) reads as rewritten:
"(a)	Creation and Purpose of Account. – There is created in the Department of Commerce, Division of Tourism, Film, and Sports Development, the Film Industry Development Account to provide annual grants as incentives to production companies that engage in production activities in this State. The Division of Tourism, Film, and Sports Development shall administer this program in accordance with the following provisions:
(1)	To be eligible for a grant, a production company must engage in production activities in this State with expenditures in this State of at least one million dollars ($1,000,000). A grant may not be used for political or issue advertising.
(2)	A grant may not exceed fifteen percent (15%) of the amount the production company spends for goods and services in this State during the calendar year.
(3)	A grant may not exceed two hundred thousand dollars ($200,000) per production."
SECTION 1.2.  The Revenue Laws Study Committee created in Article 12L of Chapter 120 of the General Statutes shall study options for additional economic incentives for the film industry and shall make a report to the 2003 General Assembly on its findings, including any recommendations for legislative action.
SECTION 1.3.  This part is effective when it becomes law.

Part 2.  North Carolina Railroad Condemnation authority

SECTION 2.1.  G.S. 40A‑3(a)(4) reads as rewritten:
"(a)	Private Condemnors. – For the public use or benefit, the persons or organizations listed below shall have the power of eminent domain and may acquire by purchase or condemnation property for the stated purposes and other works which are authorized by law.
…
(4)	Any railroad company has the power of eminent domain for the purposes of: constructing union depots; maintaining, operating, improving or straightening lines or of altering its location; constructing double tracks; constructing and maintaining new yards and terminal facilities or enlarging its yard or terminal facilities; connecting two of its lines already in operation not more than six miles apart; or constructing an industrial siding."
SECTION 2.2.  This part is effective when it becomes law.

Part 3.  Corporate income tax rate change

SECTION 3.1.  G.S. 105‑130.3 reads as rewritten:
"§ 105‑130.3.  Corporations.
A tax is imposed on the State net income of every C Corporation doing business in this State. An S Corporation is not subject to the tax levied in this section. The tax is a percentage of the taxpayer's State net income computed as follows:
					
(1)	On State net income up to three thousand dollars ($3,000), one percent (1%).
(2)	On State net income over three thousand dollars ($3,000) and up to six thousand dollars ($6,000), two percent (2%).
(3)	On State net income over six thousand dollars ($6,000) and up to nine thousand dollars ($9,000), three percent (3%).
(4)	On State net income over nine thousand dollars ($9,000) and up to twelve thousand dollars ($12,000), four percent (4%).
(5)	On State net income over twelve thousand dollars ($12,000) and up to fifteen thousand dollars ($15,000), five percent (5%).
(6)	On State net income over fifteen thousand dollars ($15,000) and up to thirty thousand dollars ($30,000), six percent (6%).
(7)	On State net income over thirty thousand dollars ($30,000), six and nine-tenths percent (6.9%)."
SECTION 3.2.  This part is effective for taxable years beginning on or after January 1, 2004.

Part 4.  Industrial and Pollution Control Facilities Financing

SECTION 4.1.  The General Assembly finds that there are small manufacturing companies in the State that are eligible for industrial development bond financing for capital improvements and expansions, but are not able to take advantage of that financing because of the administrative costs involved.  This problem can be addressed by reviving the composite bond program under Chapter 159D of the General Statutes, under which the North Carolina Capital Facilities Finance Agency could combine several series of bonds into a single bond offering, thereby reducing transaction costs and permitting eligible small manufacturers to access tax exempt financing for capital investments.  The composite bond program would be facilitated by the changes proposed to Chapter 159D in this part that will streamline the procedures for composite issues by requiring only one public hearing and align the review standard for bonds issued as part of a composite bond program with the standard for bonds issued by county industrial development projects.
SECTION 4.2.  G.S. 159D‑7(d) reads as rewritten:
"(d)	Public Hearing, Generally. – The Secretary of Commerce shall not approve any proposed project pursuant to this section unless the governing body of the county in which the project is located has first conducted a public hearing and, at or after the public hearing, approved in principle the issuance of bonds under this Article for the purpose of paying all or part of the cost of the proposed project. Notice of the public hearing shall be published at least once in at least one newspaper of general circulation in the county not less than 14 days before the public hearing. The notice shall describe generally the bonds proposed to be issued and the proposed project, including its general location, and any other information the governing body considers appropriate or the Secretary of Commerce prescribes for the purpose of providing the Secretary with the views of the community. The notice shall also state that following the public hearing the agency intends to file an application for approval of the proposed project with the Secretary of Commerce.
(d1)	Public Hearing, Multiple Projects. – Notwithstanding subsection (d) of this section, in the event the bonds proposed to be issued are to finance more than one project, the public hearing shall be conducted by the agency or by a hearing officer designated by the agency to conduct public hearings. The public hearing may be held at any location designated by the agency. Notice of the public hearing shall be published at least once in at least one newspaper of general circulation in each county in which a proposed project is to be located not less than 14 days before the public hearing. The notice shall describe generally the bonds proposed to be issued and any proposed project in that county, including its general location, and any other information the agency considers appropriate or the Secretary of Commerce prescribes for the purpose of providing the Secretary with the views of the community. A copy of the notice of public hearing must be mailed to the board of county commissioners of any county in which a proposed project is to be located and to the governing body of any municipality in which a proposed project is to be located."
SECTION 4.3.  G.S. 159D‑8(b) reads as rewritten:
"(b)	In determining whether a proposed bond issue should be approved, the Local Government Commission may consider, without limitation, the following:
(1)	Whether the proposed operator and obligor have demonstrated or can demonstrate the financial responsibility and capability to fulfill their obligations with respect to the financing agreement. In making such determination, the commission may consider the operator's experience and the obligor's ratio of current assets to current liabilities, net worth, earnings trends and coverage of fixed charges, the nature of the industry or business involved and its stability and any additional security such as credit enhancement, insurance, guaranties or property to be pledged or secure such bonds.
(2)	Whether the political subdivisions in or near which the proposed project is to be located have the ability to cope satisfactorily with the impact of such project and to provide, or cause to be provided, the public facilities and services, including utilities, that will be necessary for such project and on account of any increase in population which are expected to result therefrom.
(3)	Whether the proposed date and manner of sale will have an adverse effect upon any scheduled or anticipated sale of obligations by the State or any political subdivision or any agency of either of them."
SECTION 4.4.  This part becomes effective January 1, 2003.

Part 5.  General Provisions

SECTION 5.1.  The provisions of this act are severable.  If any provision of this act is held invalid by a court of competent jurisdiction, the invalidity does not affect other provisions of the act that can be given effect without the invalid provision.
SECTION 5.2.  Except as otherwise provided, this act is effective when it becomes law.