A bill calling for better oversight of state financial-incentive programs to lure companies to Utah was approved by a legislative committee Wednesday.

A substitute version of SB185, however, will be presented on the Senate floor and will remove a provision limiting the dollar amount of incentives the state could provide to individual companies and the total amount it could award in any single fiscal year.

The bill's sponsor, Sen. Lyle Hillyard, R-Logan, said current limitations will remain in place. The state can rebate up to 30 percent of the corporate income, sales and withholding taxes for up to 20 years for a company receiving a tax-rebate incentive. Hillyard said, however, that tax credits will be used rather than rebates.

The original SB185 limited the rebates to $3 million to any single company during a fiscal year and $150 million in cumulative rebates in any fiscal year.

Jason Perry, executive director of the Governor's Office of Economic Development, said a dollar cap would keep the state from landing certain companies that could bring huge investment to the state. He cited as an example Procter & Gamble, which will receive a rebate for a new paper-products plant in Box Elder County.

"If we set a dollar cap — $3 million, for example — Procter & Gamble, with a $6 billion deal, says, 'We're not even interested in your $3 million. We'll go somewhere else."' Perry told the Senate Workforce Services and Community and Economic Development Committee. "So a percentage makes it so we get to stay in the game, from the smallest project to the biggest project."

Hillyard said legislative staff approached him about sponsoring the bill. "Their concern was basically it was kind of like giving somebody a credit card without having any kind of a limit or any sort of provision on it," Hillyard said.

What will remain in the substitute bill is having the state Tax Commission and the Department of Workforce Services oversee incentive contracts. Those agencies currently have oversight by rule, but Hillyard said it needed to be in statute.

"I have the utmost confidence in Jason Perry and his staff, but when you create instruments that need to go for some time, you want to make sure there's mechanisms in place so you have that verification," Hillyard said.

Another change calls for incentives to come from individual tax funds rather than the state's general fund and be in the form of tax credits rather than rebates.

Perry noted that in 2007, GOED committed incentives of up to $160 million to be rebated over 20 years. But the state is expecting to have new tax revenues of $598 million and new state wages of $3.7 billion for those projects, which are also expected to feature capital investment of $1.1 billion, he said.

"In a very real sense, we are only competitive (with other states) because of these incentives," Perry said. "The great companies that we talk about — Procter & Gamble being one of them, IM Flash, Amer Sports, Goldman Sachs — some of the best companies in the United States are here in the state of Utah because of these incentives. I should say, I know without question without them those companies would not have come. They've told us that, quite clearly."

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