It is enacted by the General Assembly as follows:

SECTION 1. Chapter 44-11-11.3 of the General Laws entitled "Business Corporation Tax" is hereby amended by adding thereto the following section:

{ADD 44-11-44.3. Accelerated amortization deductions for certain manufacturers. -- ADD} {ADD Any taxpayer engaged in manufacturing activities in Rhode Island that has on the average over the five (5) previous years annually produced goods at facilities located in Rhode Island which generate net sales of at least ten million dollars ($10,000,000) and where on the average at least eighty percent (80%) of that production has been for eventual sale to a branch of the United States armed services may if it represents that it anticipates the need to reduce its reliance on such sales elect to amortize the unrecovered basis of all or a portion of its depreciable assets over a sixty (60) month period in equal monthly installments. This election shall be effective as of the first day of the fiscal year of the taxpayer in which such election is made and shall only apply to assets located in this state as of the effective date of such election. In the event any asset covered by this election is sold or otherwise disposed of during the sixty (60) month period following the effective date of the election, or if the asset is transferred to another location outside of Rhode Island and is not replaced at a location in this State by an asset of at least equal value and with a similar function, all deductions claimed with respect to such property under this section shall be immediately included in the taxpayer's income for Rhode Island income tax purposes in the year of such sale, disposition or transfer. ADD}

{ADD "If in any year during the five (5) year period following the effective date of the election, the average annual level of its full-time employees in this state drops below one thousand dollars ($1,000), the company shall recapture twenty percent (20%) of any benefit resulting from such election for each decrease of one hundred (100) full-time employees below such level up to a maximum of one hundred percent (100%) of any such benefit." ADD}

SECTION 2. This act shall take effect upon passage.