CHAPTER 81
House Bill No. 2292
An Act concerning economic development; relating to workforce development programs to be administered by the secretary of commerce; enacting the Kansas apprenticeship act to promote and expand apprenticeships with Kansas businesses, nonprofit organizations, healthcare organizations and public schools by providing grants and tax credits for businesses, nonprofit organizations and healthcare organizations that offer apprenticeships and providing scholarship grants to aspiring teachers to obtain their professional degrees; promoting and expanding public and private professional engineering programs by providing matching grants for engineering student scholarships and other program development and expansion costs; creating the Kansas nonprofit apprenticeship grant program fund, the Kansas educator registered apprenticeship grant program fund and the engineering graduate incentive fund to be administered by the secretary of commerce.
Be it enacted by the Legislature of the State of Kansas:
Section 1. Sections 1 through 6, and amendments thereto, shall be known and may be cited as the Kansas apprenticeship act.
Sec. 2. For purposes of sections 1 through 6, and amendments thereto:
(a) “Act” means the Kansas apprenticeship act.
(b) “Apprentice” means a person who is a Kansas resident at least 16 years of age, except where an older minimum age standard is otherwise fixed by law, and is employed in Kansas to learn an apprenticeable occupation as defined in 29 C.F.R. § 29.4. “Apprenticeship” includes a person who is compensated by a registered apprenticeship sponsor or a registered apprenticeship intermediary but whose apprenticeable work occurs under the supervision of an eligible employer.
(c) “Apprenticeship agreement” means a written agreement, meeting the requirements of 29 C.F.R. § 29.2, between an apprentice and either the apprentice’s registered program sponsor or an apprenticeship intermediary acting as an agent for the program sponsor, that contains the terms and conditions of the employment and training of the apprentice.
(d) “Apprenticeship program” means a plan containing all terms and conditions for the qualification, recruitment, selection, employment and training of apprentices, as required under 29 C.F.R. § 29.4 and 29 CFR § 30, including such matters as the requirement for a written apprenticeship agreement.
(e) “Eligible employer” means a business with a physical location in Kansas, authorized to conduct business in Kansas and subject to the Kansas income tax act that employs or supervises the work of an apprentice pursuant to a registered apprenticeship agreement and in accordance with a registered apprenticeship program. “Eligible employer” may include, but not be limited to, a for-profit eligible healthcare employer.
(f) “Eligible nonprofit employer” means an organization that is exempt from federal income taxation pursuant to section 501(c)(3) of the federal internal revenue code, with a physical location in Kansas and registered, if required by law, with the secretary of state that employs or supervises the work of an apprentice pursuant to a registered apprenticeship agreement and in accordance with a registered apprenticeship program. “Eligible nonprofit employer” may include, but not be limited to, a nonprofit eligible healthcare employer.
(g) “Eligible healthcare employer” means a hospital, long-term care facility or federally qualified healthcare center with a physical location in Kansas that is engaged in providing healthcare to Kansas residents and that employs or supervises the work of an apprentice pursuant to a registered apprenticeship agreement and in accordance with a registered apprenticeship program.
(h) “Intermediary” means any person, association, business, committee or organization acting as an agent for the program sponsor, pursuant to a registered apprenticeship plan, who has registered with the secretary.
(i) “Registered apprenticeship agreement” means an apprenticeship agreement that has been accepted and recorded by the office of apprenticeship of the employment and training administration of the United States department of labor or the secretary as evidence of the apprentice’s participation in a particular registered apprenticeship program.
(j) “Registered apprenticeship program” means an apprenticeship program that has been accepted and recorded by the office of apprenticeship of the employment and training administration of the United States department of labor or has been registered or approved by the secretary as meeting the basic standards and requirements of the United States department of labor for approval of such program.
(k) “Secretary” means the secretary of commerce or the secretary’s designee, including the director of the office of registered apprenticeship or any successor, designated by the secretary of commerce to administer the provisions of this act.
(l) “Sponsor” means any person, association, business, committee or organization operating a registered apprenticeship program in whose name the program is registered or approved and who has registered with the secretary.
Sec. 3. (a) (1) For tax years commencing after December 31, 2022, and ending before January 1, 2026, a credit shall be allowed against the income tax liability imposed upon an eligible employer pursuant to the Kansas income tax act that employs an apprentice pursuant to a registered apprenticeship agreement and in accordance with a registered apprenticeship plan for at least all or a portion of the probationary period, as defined for that apprenticeship in the registered apprenticeship program standards, work process schedule otherwise known as appendix A or as designated by the secretary, and so employs the apprentice at the time such probationary period is completed. The tax credit shall be claimed by such eligible employer for the taxable year in which the apprentice completed the probationary period while employed by such eligible employer or the taxable year next succeeding the calendar year in which the apprentice completed the probationary period while employed by such eligible employer, as determined by the secretary and set forth in the agreement with the secretary pursuant to subsection (d). Subsequent credits may be claimed for up to three successive calendar years, or portions thereof, next succeeding the date on which the probationary period of the apprentice was met, by any eligible employer who subsequently employs such apprentice in all or a portion of such year. Such credit shall be claimed by the eligible employer for the taxable year in which the apprentice was employed or the taxable year next succeeding the calendar year in which the apprentice was employed as determined by the secretary and set forth in the agreement with the secretary as provided by subsection (d). The amount of the credit shall be up to $2,500, as determined pursuant to paragraph (2), for each apprentice so employed and may be awarded for up to 20 apprentices employed in each taxable year per eligible employer. The credit shall not be awarded for employment of the same apprentice more than four times.
(2) The secretary of revenue, in consultation with the secretary, shall establish a scale reflecting ranges of wages and other expenditures an eligible employer has invested in an apprentice and a corresponding tax credit amount and shall award the tax credit in accordance with the scale. The credit shall be approved and issued pursuant to subsection (d).
(b) For tax years commencing after December 31, 2025, a credit shall be allowed against the income tax liability imposed upon an eligible employer pursuant to the Kansas income tax act that employs an apprentice pursuant to a registered apprenticeship agreement and in accordance with a registered apprenticeship plan for a continuous period of time constituting at least 25% of the apprenticeship time period required by the registered apprenticeship program. The credit shall be taken in the tax year next succeeding the calendar year in which the employment requirement to claim the credit is met. The credit may subsequently be taken in successive tax years based on up to a cumulative total of four successive calendar years of employment for an individual apprentice. The amount of the credit shall be up to $2,750 for each apprentice employed, not to exceed 20 such credits for apprenticeships in any taxable year per eligible employer. The secretary may authorize a credit for employment of less than a full calendar year pursuant to rules and regulations adopted by the secretary of commerce. The credit shall be approved and issued pursuant to subsection (d).
(c) (1) An eligible employer may be allowed a credit as provided by paragraph (2) that shall be in addition to a credit allowed for an apprentice pursuant to subsection (b) if the apprentice:
(A) Is enrolled in a secondary or postsecondary career and technical education program;
(B) is under 18 years of age at the time the credit is claimed;
(C) has been employed by the eligible employer for at least 90 days; and
(D) is participating in:
(i) An apprenticeship program registered with the secretary and funded through the Carl D. Perkins career and technical education act of 2006, public law 109-270, as revised by the strengthening career and technical education for the 21st century act, public law 115-224;
(ii) an adult basic education and literacy program funded under title II of the workforce innovation and opportunity act, public law 113-128; or
(iii) a public workforce program funded under title I and title III of the workforce innovation and opportunity act, public law 113-128.
(2) Each such credit shall not exceed $500. The tax credit shall be claimed in the taxable year next succeeding the calendar year in which the requirements to claim the credit are met. An eligible employer shall not claim more than 10 credits under this subsection in a tax year. The credit shall be approved and issued pursuant to subsection (d).
(d) (1) Tax credits pursuant to subsections (a), (b) and (c) shall not be refundable or transferable. The credits may be claimed on a pro-rata basis by the owners of eligible employers that are entities taxed under subchapter S or K of the federal internal revenue code, limited liability companies or professional corporations authorized to do business in this state. The aggregate amount of all tax credits for all eligible employers issued pursuant to this section shall not exceed $7,500,000 each taxable year. The aggregate amount of all tax credits for all eligible employers issued pursuant to this section in addition to all grants awarded pursuant to section 4, and amendments thereto, shall not exceed $10,000,000 each taxable year.
(2) To be eligible for a tax credit under this section, the eligible employer shall enter into an agreement regarding the employment of apprentices with the secretary on such terms and conditions as the secretary may require. The agreement shall set forth the amount per credit or amount of cumulative credits an employer may earn based on specified conditions or attainment of specified employment or training goals and any other conditions for such credits consistent with the purposes of this act. If applicable, the agreement shall set forth the relevant provisions of the scale provided by subsection (a)(2). The agreement shall also require that the eligible employer provide such information as required by the secretary or the secretary of revenue for purposes of substantiating eligibility for the tax credit, the development and expansion of apprenticeships in this state and the report required by subsection (g). Such agreements shall be made by the secretary with the goal of developing and expanding apprenticeships in this state. The secretary shall advise the secretary of revenue of the potential tax credits available to the eligible employer. The secretary shall consult with the secretary of revenue, the Kansas postsecondary technical education authority and educational institutions, technical schools, secondary schools, business or industry associations and other appropriate entities to coordinate implementation, administration and development of apprenticeship programs in this state, including through the use of tax credits as provided by this section.
(3) If an agreement as required by paragraph (2) is approved by the secretary, the eligible employer shall submit such information in the manner and form as required by the secretary and the secretary of revenue to demonstrate eligibility for the credit each tax year a credit is claimed. No tax credit shall be awarded by the secretary of revenue unless the secretary of commerce has certified the eligible employer to the secretary of revenue as having met the requirements for such credit pursuant to this section and in compliance with all federal and state requirements for the registered apprenticeship program and registered apprenticeship agreement. To receive a credit, the eligible employer shall also meet the requirements of any rules and regulations of the secretary of revenue or the secretary of commerce.
(e) The participation of an employee with an apprenticeship program under this act and registration with the secretary shall not constitute union affiliation, unless the employee expressly elects to affiliate with a union.
(f) The secretary of commerce or the secretary of revenue may adopt rules and regulations as necessary to establish standards for participation and eligibility and to implement and administer this act.
(g) The secretary shall provide an annual report before January 31 of each year to the house of representatives standing committee on commerce, labor and economic development and the senate standing committee on commerce to account for the effectiveness of the apprenticeship program under this act. The report shall include information regarding the number and type of eligible employers, eligible nonprofit employers and eligible healthcare employers the number and type of apprenticeships incentivized, the amount of tax credits and grants issued and the amounts issued per industry and per eligible employer, eligible nonprofit employers and eligible healthcare employers results of the program including information on the employment of individuals following participation in an apprenticeship program, the extent and nature of coordination and efforts with other entities to develop apprenticeship programs, the effect of such efforts and the tax credits and grants on apprenticeship program development and such other information as requested by the respective committees.
Sec. 4. (a) There is hereby established the Kansas nonprofit apprenticeship grant program. The secretary is authorized to develop and administer the program to award grants to eligible nonprofit employers and eligible nonprofit healthcare employers that employ an apprentice pursuant to a registered apprenticeship agreement and in accordance with a registered apprenticeship plan for the purpose of covering administrative costs of registered apprenticeship programs, including program development costs, costs of meeting reporting obligations and other administrative costs. To be eligible for such grants, an eligible nonprofit employer or eligible nonprofit healthcare employer shall enter into an agreement with the secretary to employ an apprentice for at least the same period of time as provided under section 3(a)(1) or (b), and amendments thereto, as applicable at the time the apprentice is employed, for an eligible employer to receive a tax credit. As provided for eligible employers by section 3(b), and amendments thereto, the secretary may authorize employment of an apprentice for less than a full year.
(b) Grants shall be awarded by the secretary in an amount of up to $2,750 per apprenticeship per taxable year, as determined by the secretary and set forth in the agreement pursuant to subsection (d), not to exceed four successive years. Grants shall be limited to not more than 20 per eligible nonprofit employer or per eligible nonprofit healthcare employer per taxable year.
(c) The secretary shall develop application procedures, forms and grant award terms, conditions and criteria in accordance with the purposes of the grant program. The secretary shall consult with appropriate state agencies, institutions, nonprofit organizations and associations, private healthcare associations, nonprofit Kansas healthcare providers and other appropriate entities in developing the grant program and grant award criteria and priorities. Grants shall be awarded pursuant to an agreement with the eligible nonprofit employer or eligible nonprofit healthcare employer upon such terms and conditions as the secretary may require consistent with the purposes of the program. Such terms and conditions may include program development, employment or training goals in addition to specified employment requirements with respect to an apprentice or apprentices.
(d) There is hereby established in the state treasury the Kansas nonprofit apprenticeship grant program fund to be administered by the secretary of commerce. All moneys credited to such fund shall be used to provide grants for the administration of apprenticeship programs by eligible nonprofit employers and eligible nonprofit healthcare employers in the state of Kansas as provided by this section and the administration of such fund. All expenditures from such fund shall be made in accordance with the provisions of appropriation acts and upon warrants of the director of accounts and reports issued pursuant to vouchers approved by the secretary of commerce or the secretary’s designee.
(e) Subject to appropriation acts, on July 1, 2023, and each July 1 thereafter, the director of accounts and reports shall transfer $2,500,000 from the state general fund to the Kansas nonprofit apprenticeship grant program fund. Any unencumbered balance in such fund at the end of a fiscal year shall remain credited to the fund for use in the succeeding fiscal year, except that such unencumbered balance at the end of the fiscal year to remain credited to the fund for use in the succeeding fiscal year shall not exceed $2,500,000. On June 30, 2024, and each June 30 thereafter, the director of accounts and reports shall transfer the amount, if any, of unencumbered moneys in the fund in excess of $2,500,000 to the state general fund. The amount of all tax credits issued to all eligible employers pursuant to section 3, and amendments thereto, in addition to the amount of all grants issued pursuant to this section, shall not exceed a total aggregate amount of $10,000,000 in each taxable year, as provided by section 3(d)(1), and amendments thereto.
Sec. 5. For purposes of sections 5 and 6, and amendments thereto:
(a) “Applicant school” means a school district organized and operating under the laws of this state, acting independently or as part of a consortia with other school districts that seeks to engage in a registered education apprenticeship program.
(b) “Candidate” means a paraeducator or other person employed by a school district who seeks to become a licensed teacher and who currently does not possess such a license.
(c) “Education apprentice” means a person who is a Kansas resident at least 16 years of age, except where an older minimum age standard is otherwise fixed by law, is a candidate, has been selected to participate in a registered education apprenticeship program by an applicant school and is employed to learn the apprenticeable occupation, as defined in 29 C.F.R. § 29.4, of teaching.
(d) “Eligible related training instruction provider” means an institution of higher education that provides a teacher preparation program and is:
(1) A state educational institution under the control and supervision of the board of regents;
(2) a municipal university;
(3) any not-for-profit institution of postsecondary education with its main campus or principal place of operation in Kansas, is operated independently and not controlled or administered by any state agency or subdivision of the state, maintains open enrollment and is accredited by a nationally recognized accrediting agency for higher education in the United States; or
(4) a not-for-profit independent institution of higher education which is accredited by an institutional accrediting agency recognized by the United States department of education, is operated independently and not controlled or administered by the state or any agency or subdivision thereof, maintains open enrollment, offers online education, offers exclusively competency-based education programs and has been granted accreditation for its teacher licensure programs by the council for the accreditation of educator preparation and the association for advancing quality in educator preparation.
(e) “Registered education apprenticeship program” means an apprenticeship program, as defined in section 1, and amendments thereto, that is a registered apprenticeship program, as defined in section 1, and amendments thereto, of an applicant school for the profession of teaching that provides candidates combined classroom and on the job training under the direct supervision of a licensed professional teacher and has been approved by the secretary.
(f) “Secretary” means the secretary of commerce or the secretary’s designee, including the director of the office of registered apprenticeship or any successor, designated by the secretary to administer the provisions of this act.
Sec. 6. (a) There is hereby established the Kansas educator registered apprenticeship grant program. The commissioner of education, state board of education and the secretary shall coordinate to develop the program and obtain such necessary approval and registration of education apprenticeship programs as provided by federal and state law. The secretary shall administer the grant program.
(b) The Kansas educator registered apprenticeship program shall be established to award grants to education apprentices for tuition, fees, books and materials to obtain their postsecondary degrees for the purpose of increasing the number of qualified, credentialed teachers in the state of Kansas. The program shall seek to identify a diverse group of candidates to participate as education apprentices in a registered education apprenticeship program or programs and obtain a bachelor’s degree in education, secure licensure and engage in the profession of teaching in Kansas. Grants shall be awarded by the secretary upon approval of the registered education apprenticeship program of an applicant school by the secretary as compliant with all applicable federal and state law.
(c) On or before March 1, 2024, the state board of education and the secretary shall coordinate to adopt rules and regulations to implement and administer the Kansas educator registered apprenticeship grant program. Such rules and regulations shall establish:
(1) Application procedures, forms and terms and conditions and requirements for an award of a Kansas educator registered apprenticeship program grant to an education apprentice by the secretary;
(2) the terms, conditions and requirements for acceptance by the secretary of an applicant school into the Kansas educator registered apprenticeship program. The applicant school’s registered education apprenticeship program design shall include the following requirements:
(A) Applicant schools shall partner with at least one eligible related training instruction provider and identify such provider in their application; and
(B) applicant schools shall identify projected candidates in the manner designated by the secretary of commerce and the state board with appropriate protections for candidate privacy;
(3) grant funds shall be used for payment of education apprentice tuition, fees and the cost of books and materials up to a maximum of $2,750 per year for four years, or completion of their academic program, whichever comes first;
(4) prioritization for applications from applicant schools partnering with eligible related training instruction providers that permit the apprentice to continue their current employment by utilizing flexible learning models such as online delivery, competency-based education or courses offered on nights or weekends; and
(5) a method to award grants equitably across the state geographically.
(d) The commissioner of education, the state board of education and the secretary shall, beginning in 2025, annually evaluate the Kansas educator registered apprenticeship program grant and prepare and submit a report before January 31, 2026, and before January 31 of each year thereafter, to the senate standing committee on education and the standing committee on commerce and to the house of representatives standing committee on education and the standing committee on commerce, labor and economic development.
(e) Subject to appropriation acts, on July 1, 2023, and each July 1 thereafter, the director of accounts and reports shall transfer $3,000,000 from the state general fund to the Kansas educator registered apprenticeship grant program fund. Any unencumbered balance in such fund at the end of a fiscal year shall remain credited to the fund for use in the succeeding fiscal year, except that the amount of such unencumbered balance at the end of the fiscal year to remain credited to the fund for use in the succeeding fiscal year shall not exceed $3,000,000. On June 30, 2024, and each June 30 thereafter, the director of accounts and reports shall transfer the amount, if any, of unencumbered moneys in the fund in excess of $3,000,000 to the state general fund.
(f) There is hereby created in the state treasury the Kansas educator registered apprenticeship grant program fund, which shall be administered by the secretary. All expenditures from the Kansas educator registered apprenticeship grant program fund shall be for grants awarded pursuant to the Kansas educator registered apprenticeship grant program. All expenditures from the Kansas educator registered apprenticeship grant program fund shall be made in accordance with appropriation acts upon warrants of the director of accounts and reports issued pursuant to vouchers approved by the secretary, or the secretary’s designee. All moneys received by the secretary for the Kansas educator registered apprenticeship grant program shall be deposited in the state treasury in accordance with the provisions of K.S.A. 75-4215, and amendments thereto. Upon receipt of each such remittance, the state treasurer shall deposit the entire amount in the state treasury to the credit of the Kansas educator registered apprenticeship grant program fund.
Sec. 7. As used in this section and section 8, and amendments thereto:
(a) “Eligible institution of higher education” means:
(1) (A) A state educational institution as defined in K.S.A. 76-711, and amendments thereto; or
(B) any private, independent college with its primary location in Kansas that is a member of the Kansas independent college association as of July 1, 2023; and
(2) that has an engineering program accredited by the accreditation board for engineering and technology.
(b) “Engineering program” or “accredited engineering program” means an engineering program accredited by the accreditation board for engineering and technology and includes, but is not limited to, a program in computer engineering or computer science.
(c) “Qualified eligible institution of higher education” means an eligible institution of higher education that has certified to the secretary that, in the immediately preceding academic year, at least the following number of students have graduated with baccalaureate degrees from an engineering program or programs with respect to each institution:
(1) Kansas state university, 586 graduates;
(2) university of Kansas, 419 graduates;
(3) Wichita state university, 360 graduates;
(4) any other state educational institution as defined in K.S.A. 76-711, and amendments thereto, with an accredited engineering program, one or more graduates; and
(5) private, independent colleges, one or more graduates.
(d) “Secretary” means the secretary of commerce.
Sec. 8. (a) There is hereby created in the state treasury the engineering graduate incentive fund. The secretary of commerce shall administer the fund. All expenditures from the fund shall be for the purpose of promoting the development of accredited postsecondary engineering programs in Kansas by providing grants that shall be matched on a $1-for-$1 basis with funds from nonstate sources to qualified eligible institutions of higher education for:
(1) Awarding scholarships to undergraduate students enrolled at such institutions in an engineering program;
(2) recruiting undergraduate students for engineering programs offered by such institutions;
(3) expanding the number of potential engineering students through engineering-related activities in secondary schools in Kansas;
(4) funding internships for undergraduate students enrolled at such institutions in an engineering program;
(5) making necessary facility improvements or equipment purchases to expand engineering program course offerings; or
(6) hiring additional faculty or enhancing faculty salaries in such an institution’s engineering program.
(b) Applications for matching grants shall be made by eligible institutions of higher education to the secretary in the form and manner required by the secretary. If the secretary determines the institution is a qualified eligible institution of higher education, finds the institution has sufficient nonstate funding to match the grant requested on a $1-for-$1 basis and approves the application, the qualified eligible institution of higher education shall receive a matching grant. If sufficient moneys are available in the engineering graduate incentive fund to fully fund all approved applications, the amount of the matching grant shall be at least $20,000 for each graduate of an engineering program of the institution during the immediately preceding academic year, as determined by the secretary, in excess of the threshold requirement for qualification as a qualified eligible institution of higher education pursuant to section 7, and amendments thereto. If sufficient moneys are not available in the engineering graduate incentive fund to fully fund all approved applications in an amount of at least $20,000 for each such graduate, the secretary shall award grants in a prorated amount so that all approved applicant qualified eligible educational institutions receive the same amount of grant money for a graduate in excess of such respective threshold. The secretary shall consult with and coordinate with eligible institutions of higher education, qualified eligible institutions of higher education, the state board of regents, or private industry in planning and developing uses for matching grant funding to achieve the purpose of this act.
(c) Qualified eligible institutions of higher education that receive a matching grant shall provide such information as requested by the secretary, excluding any information confidential under state or federal law, regarding the use of grant funds. On or before January 10, 2024, and on or before the first day of each regular session of the legislature thereafter, the secretary shall provide a written report to the house of representatives standing committee on commerce, labor and economic development, or its successor committee, and the senate standing committee on commerce, or its successor committee, on the amount and uses of grant funding by each qualified eligible educational institution of higher education that has received a matching grant and progress made toward the goal of this act.
(d) All expenditures from the engineering graduate fund shall be for the purposes described in subsection (a) and shall be made in accordance with appropriation acts upon warrants of the director of accounts and reports issued pursuant to vouchers approved by the secretary of commerce or the secretary’s designee.
(e) No moneys appropriated to the engineering graduate incentive fund shall be expended for the acquisition or construction of any facilities.
(f) (1) On July 1, 2023, or as soon thereafter as moneys are available, the director of accounts and reports shall transfer $1,500,000 from the state general fund to the engineering graduate fund.
(2) On July 1, 2024, and on each July 1 thereafter, the secretary shall certify to the director of accounts and reports the amount of moneys expended for grants from the engineering graduate fund in the prior fiscal year. Upon receipt of such certification, or as soon thereafter as moneys are available, the director of accounts and reports shall transfer from the state general fund to the engineering graduate fund an amount equal to twice the amount certified by the secretary of commerce, except that if such transfer would result in an unencumbered balance in the engineering graduate fund of greater than $5,000,000, the director of accounts and reports shall transfer the amount of moneys that shall result in an unencumbered balance of $5,000,000 in the engineering graduate fund on such date.
Sec. 9. The provisions of sections 7 through 9, and amendments thereto, shall expire on July 1, 2033. On July 1, 2033, the director of accounts and reports shall transfer all unencumbered moneys in the engineering graduate fund to the state general fund. After such transfer, the engineering graduate fund shall be abolished. Upon abolishment of such fund, all liabilities of the engineering graduate fund shall be transferred to and imposed on the state general fund.
Sec. 10. This act shall take effect and be in force from and after its publication in the statute book.
Approved April 24, 2023.
