Sec. 503. Requirements applicable to tax incentive programs
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A taxpayer seeking a credit under sections 121, 125, 204, 205, 206, 207, 302, and 307 of this Act, shall submit to the Secretary of the Treasury, along with the taxpayer’s timely filed return, a declaration made under the penalties of perjury certifying compliance with the requirements under subsection (b). The Secretary of the Treasury shall require a taxpayer, as a condition of receiving a credit under a program enumerated in subsection (a), to satisfy each of the following requirements during the taxable year for which such credit is claimed and any other period in which construction, alteration or repair work was performed for purposes of qualifying for a credit set forth in subsection (a):
All laborers and mechanics employed by contractors or subcontractors in the performance of construction, alteration, or repair work on any qualified facility, energy storage property, electricity generation facility, advanced nuclear power facility, qualifying advanced energy project, qualified offshore wind property, or other projects contemplated by the credit programs enumerated in subsection (a), shall be paid wages at rates not less than those prevailing on projects of a similar character in the locality as determined by the Secretary of Labor in accordance with subchapter IV of chapter 31 of title 40, United States Code.
With respect to the labor standards in this paragraph, the Secretary of Labor shall have the authority and functions set forth in Reorganization Plan Numbered 14 of 1950 (64 Stat. 1267; 5 U.S.C. App.) and section 3145 of title 40, United States Code. All contractors and subcontractors engaged in the performance of construction, alteration, or repair work on any project described in paragraph
(1)shall, subject to subparagraph (B), ensure that not less than 15 percent of the total labor hours of such work be performed by qualified apprentices. The requirement under subparagraph
(A)shall be subject to any applicable requirements for apprentice-to-journeyworker ratios of the Department of Labor or the applicable State apprenticeship agency. Each contractor and subcontractor who employs 4 or more individuals to perform construction, alteration, or repair work on a covered project shall employ 1 or more qualified apprentices to perform such work. While the project is ongoing, the contractor shall, with each payment application to the taxpayer, include a report with the following: The names of all qualified apprentices and their apprentice registration or identification number. The number of qualified apprentices and labor hours worked by them, categorized by trade or craft. The number of journey level workers and labor hours worked by them, categorized by trade or craft. Such reports shall be included with the taxpayer’s declaration under subsection (a). The taxpayer, its contractor, and subcontractors, shall maintain all reports and personnel records relating to the requirements of subparagraph
(D)for a period of at least 3 years after final completion of the work. The taxpayer, its contractor, and subcontractors, shall immediately submit, upon request by the Secretary of Energy, the documents described in subparagraphs
(D)and (E). Failure to produce such documents shall result in penalties. The Secretary of the Treasury may, upon request by a taxpayer, adjust the requirements of subsection (b)(2) for a specific project, when the taxpayer has provided documentary evidence of the following: A demonstrated lack of availability of qualified apprentices in specific geographic areas. A good faith effort on the part of the taxpayer, its contractor and subcontractors to comply with the requirements of subsection (b)(2). Such waivers and the rationale of the Secretary of the Treasury for granting such waivers shall be public and shall not be exempt from disclosure under section 552(b) of Title 5, United States Code. For purposes of this subsection: The term contractor means a general contractor or other lead or prime contractor on a construction project described in subsection (b)(2). The term labor hours means the total number of hours devoted to the performance of construction activities (as defined in Sector 23 of the North American Industry Classification System) by employees of the contractor and all subcontractors. The term excludes hours worked by foremen, superintendents, owners, and persons employed in a bona fide executive, administrative, or professional capacity as defined in part 541 of title 29, Code of Federal Regulations. The term qualified apprentice means an employee participating in an apprenticeship program (as such term is defined in section 3131(e)(3)(B) of the Internal Revenue Code of 1986). The term subcontractor means any person or company, at any tier, that performs some or all of the obligations of the contractor on a construction project described in subsection (b)(2). Nothing in this subsection shall preempt applicable State or local laws or policies that provide for additional skilled and trained workforce requirements on construction projects. Upon receipt of a complaint or its own initiative, the Secretary of Energy, in consultation with the Secretary of Labor, shall request and review the weekly payroll records of contractors and subcontractors engaged in the performance of any construction, alteration, or repair work on projects described in paragraphs
(1)and
(2)of subsection (b), the reports set forth in subparagraphs
(D)and
(E)of subsection (b)(2), and interview individuals employed by such contractors and subcontractors, to determine whether the requirements of paragraphs
(1)and
(2)of subsection
(b)have been met. The taxpayer shall be responsible for compliance by any contractor or lower tier subcontractor performing any construction, alteration, or repair work on projects described in paragraphs
(1)and
(2)of subsection (b). If the Secretary of Energy determines, upon receipt of a complaint or its own initiative, that a project was not carried out in accordance with the requirements of this section, the taxpayer shall be liable to the Department of the Treasury for the following: For violations of subsection (b)(1), the taxpayer shall be liable for any unpaid wages. In addition, the taxpayer shall be liable to the Department of the Treasury for an administrative penalty in the amount of not less than $1,000 but not more than $5,000 per each individual not paid the proper prevailing rate. For violations of subsection (b)(2), the taxpayer shall be liable to the Department of the Treasury in the amount of not less than $1,000, but not more than $5,000, for each hour of the apprenticeship utilization requirement that is not achieved. If the Secretary of Energy, in consultation with the Secretary of Labor, determines that any of the information in a declaration under subsection
(a)or report under subsection (b)(2)(D) and (E), contains false or misleading information that was provided knowingly or with reckless disregard for the truth, or omits information that was omitted knowingly or with reckless disregard of the truth, the taxpayer shall no longer be eligible for any of the credits enumerated in subsection (a), and shall be fined not less than $5,000 but not more than $10,000. Declarations under subsection
(a)and reports under subsection (b)(2)(D) and
(E)shall be publicly available and the information contained therein shall not be exempt from disclosure under section 552(b) of title 5, United States Code.
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Sec. 503
Requirements applicable to tax incentive programs
Stat.64 Stat. 1267
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