Life Sciences Job Creation Tax Credit Act
The Life Sciences Job Creation Tax Credit incentivizes companies to hire researchers, scientists, and technical workers in the life sciences sector, with a focus on displaced talent and recent STEM graduates. The credit rewards quality, long-term employment while helping firms absorb skilled workers affected by federal research funding cuts. By pairing workforce retention with industry growth, the Act supports both economic stability and innovation capacity.
Key Provisions
Hiring-Based Tax Credit: Provides a per-employee tax credit to life sciences employers that hire eligible workers, including displaced researchers and graduates from public universities.
Bonus Credit for In-State NIH Displacement Hires: Offers enhanced credits for employers who hire individuals formerly funded by NIH or other federal biomedical grants.
Minimum Compensation and Duration Requirements: Establishes thresholds to ensure quality, full-time employment with benefits.
Eligible Employer Criteria: Targets firms engaged in biopharma, biotech, diagnostics, medical devices, or digital health with primary operations in the state.
Sunset and Evaluation Clause: Requires periodic reporting and reevaluation of the tax credit’s return on investment and impact.
Model Language
Section 1. Short Title. This Act shall be known and may be cited as the "Life Sciences Job Creation Tax Credit Act."
Section 2. Purpose. The purpose of this Act is to promote job growth and retention in the state’s life sciences sector while supporting workers impacted by federal biomedical research funding reductions.
Section 3. Definitions.
(a) "Eligible employee" means an individual who: (1) Holds a degree in a science, technology, or health-related field; and (2) Has been displaced from a position funded by NIH or other federal biomedical agencies, or has graduated from an in-state university within the past 36 months.
(b) "Eligible employer" means a for-profit or nonprofit entity headquartered or maintaining a principal place of business in the state and engaged in life sciences-related activities.
(c) "Department" means the state agency responsible for revenue or economic development.
Section 4. Hiring-Based Tax Credit.
(a) An eligible employer shall be entitled to a tax credit of up to $7,500 per eligible employee hired, provided that: (1) The position is full-time and maintained for at least 12 consecutive months;(2) The employee receives health insurance and compensation of at least $55,000 annually.
(b) An additional $2,500 shall be awarded per hire meeting both of the following: (1) Previously employed on a federally funded biomedical research grant; (2) Resides in-state at time of hiring.
Section 5. Credit Limitations and Carryforward.
(a) The total annual tax credit available to any single employer shall not exceed $500,000.
(b) Unused credits may be carried forward for up to five years.
(c) The Department shall not authorize more than $10 million in total annual credits statewide.
Section 6. Application and Verification.
(a) Employers must apply to the Department prior to claiming credits.
(b) The Department shall verify: (1) Employee eligibility; (2) Job creation metrics; (3) Compliance with compensation and duration requirements.
Section 7. Reporting and Sunset.
(a) The Department shall report annually on: (1) Total credits claimed; (2) Jobs created or retained; (3) Wages and sectors represented.
(b) This Act shall sunset after five years unless reauthorized by the Legislature.
Section 8. Severability. If any provision of this Act is held invalid, the remainder shall remain in full force and effect.
Section 9. Effective Date. This Act shall take effect on January 1 of the year following its enactment.