S.B. 233
         UTAH SMALL BUSINESS JOBS ACT

Senate Committee Amendments

Amendment 1 February 25, 2014 3:23 PM



Senator John L. Valentine proposes the following amendments:

1.    Page 2, Lines 31 through 32 :    

             31      Other Special Clauses:
             32          This bill takes effect on
{   July 1   }        September 2       , 2014.


2.    Page 4, Lines 105 through 107 :    

             105          (2) An entity may claim a nonrefundable tax credit against a tax liability under this
             106      chapter in accordance with this section if the entity is issued a tax credit certificate by the office
             107      under Subsection 63M-1-3403 (11).
  The office shall issue a tax credit certificate to an entity that is allocated tax credits under Subsection 63M-1-3403(11)(e).      


3.    Page 4, Lines 114 through 116 :    

             114          (5) An entity required to pay a retaliatory tax levied under this chapter for a reason
             115      other than claiming the tax credit may claim the tax credit after the retaliatory tax amount is
             116      calculated
  , and the tax credit may be used to offset retaliatory tax liability       .


4.    Page 8, Lines 223 through 227 :    

             223          (4) "Credit allowance date" means with respect to a qualified equity investment:
             224          
{   (a) the January 1 immediately following the date on which the qualified equity

             225      investment is initially made; and
             226          (b) the January 1 immediately following each of the six anniversary dates of the date
             227      on which the qualified equity investment is initially made.   }
  (a) the date on which the qualified equity investment is initially made; and

(b) each of the six anniversary dates of the date described in Subsection (4)(a).  


5.    Page 8, Lines 236 through 238 :    

             236          
{   (7) "Pass-through entity" is as defined in Section 59-10-1402 .

             237          (8) "Pass-through entity taxpayer" is as defined in Section 59-10-1402 .   }
             238          
{   (9)   }        (7)       "Purchase price" means the amount paid to the qualified community development


6.    Page 8, Line 242 :    

             242          
{   (10)   }        (8)       (a) "Qualified active low-income community business" is as defined in Section


7.    Page 9, Line 247 :    

             247          (b) Notwithstanding Subsection
{   (10)   }        (8)       (a), "qualified active low-income community


8.    Page 9, Line 260 :    

             260          
{   (11)   }        (9)       (a) "Qualified community development entity" is as defined in Section 45D,


9.    Page 9, Line 270 :    

             270          
{   (12)   }        (10)       (a) "Qualified equity investment" means an equity investment in, or long-term


10.    Page 9, Lines 272 through 273 :    

             272          (i) is acquired on or after
{   July 1,   }        September 2,       2014, at its original issuance solely in exchange for

             273      cash;

11.    Page 10, Lines 280 through 282 :    

             280          (b) Notwithstanding Subsection
{   (12)   }        (10)       (a), "qualified equity investment" includes a

             281      qualified equity investment that does not meet the provisions of Subsection
{   (12)   }        (10)       (a) if the

             282      investment was a qualified equity investment in the hands of a prior holder.

12.    Page 10, Line 283 :    

             283          
{   (13)   }        (11)       "Qualified low-income community investment" means a capital or equity


13.    Page 10, Line 292 :    

             292          
{   (14)   }        (12)       "Tax credit certificate" is a certificate issued by the office under Subsection


14.    Page 10, Lines 302 through 306 :    

             302          (1) A qualified community development entity that seeks to have an equity investment
             303      or long-term debt security certified as a qualified equity investment and as eligible for tax
             304      credits under Section 59-9-107 shall apply to the office. The office shall begin accepting
             305      applications on
{   July 1   }        September 2       , 2014. The qualified community development entity shall include the

             306      following in the qualified community development entity's application:

15.    Page 11, Lines 311 through 315 :    

             311          
{   (c) a certificate executed by an executive officer of the applicant attesting that:

             312          (i) the allocation agreement remains in effect and has not been revoked or cancelled by

             313      the Community Development Financial Institutions Fund; and
             314          (ii) the applicant is not subject to, or controlled by an entity subject to the requirements
             315      of 12 U.S.C. Sec. 2901 et seq.;   }
  (c) a certificate executed by an executive officer of the applicant attesting that the allocation agreement remains in effect and has not been revoked or cancelled by the Community Development Financial Institutions Fund.      


16.    Page 11, Lines 328 through 329 :    

             328          (g) a nonrefundable application fee of $5,000 paid to the office for each application
             329      submitted
  , which is deposited into the General Fund and $2,500 of which is a dedicated credit for the office to cover the administrative costs related to this part       ; and


17.    Page 12, Lines 346 through 356 :    

             346          (3) (a)
{   Subject to Subsection (3)(b), if   }        If       the application is complete, the office shall

             347      certify the proposed equity investment or long-term debt security as a qualified equity
             348      investment, subject to the limitations contained in Subsection (6).
             349          
{   (b) The office may not certify qualified equity investments for an applicant, on a

             350      combined basis with all of its affiliates, in excess of $50,000,000 unless the applicant has:
             351          (i) already had qualified equity investments certified under this section;
             352          (ii) satisfied the requirements of Subsection (8) with respect to the qualified equity
             353      investments that have been certified; and
             354          (iii) filed a new application after satisfying the requirements of Subsections (3)(b)(i)
             355      and (ii).   }
             356          
{   (c)   }        (b)       The office shall provide written notice of the certification to the qualified


18.    Page 13, Lines 376 through 379 :    

             376          (6) (a) The office shall certify
{   $100,000,000   }        $50,000,000       in qualified equity investments pursuant to

             377      this section. If a pending request cannot be fully certified due to this limit, the office shall
             378      certify the portion that may be certified unless the qualified community development entity
             379      elects to withdraw its request rather than receive partial certification.

19.    Page 15, Lines 439 through 440 :    

             439          (b) For each calendar year
  beginning with calendar year 2016       an entity is eligible for a tax credit under this section and

             440      Section 59-9-107 , the office shall issue to the entity a tax credit certificate
  for use after January 1, 2017 and provide the State Tax Commission a copy of the tax credit certificate       .


20.    Page 15, Lines 445 through 453 :    


             445     
{       (d) The tax credit amount is equal to an amount calculated by the office as follows, the

             446      office shall:
             447          (i) multiply the applicable percentage for the credit allowance date by the purchase
             448      price paid to the qualified community development entity for the qualified equity investment;
             449      and
             450          (ii) if the entity that makes a qualified equity investment is a pass-through entity,
             451      allocate the amount calculated under Subsection (11)(d)(i) to the pass-through entity taxpayers
             452      in accordance with the agreement among the pass-through entity taxpayers as provided in
             453      Subsection (11)(e).   }
  The office shall calculate the tax credit amount and the tax credit amount shall be equal to the applicable percentage for the credit allowance date multiplied by the purchase price paid to the qualified community development entity for the qualified equity investment.      


21.    Page 15, Lines 454 through 456 :    

             454          
{   (e) A tax credit claimed by a pass-through entity shall be allocated to a pass-through

             455      entity taxpayer in accordance with the agreement among the pass-through entity taxpayers. An
             456      allocation under this Subsection (11)(e) is not considered a violation of Subsection (11)(f).   }
  (e) A tax credit earned by a partnership, limited liability company, or S-corporation may be allocated to the partners, members, or shareholders of the partnership, limited liability company, or S-corporation for the partners', members', or shareholders' direct use in accordance with the provisions of any agreement among the partners, members, or shareholders.      


22.    Page 15, Line 457 :    

             457          (f) An entity may not sell a tax credit allowed under this section on the open market.
  (12)(a) An entity that claims a tax credit under Section 59-9-107 and this section shall provide the office with a document that expressly directs and authorizes the State Tax Commission to disclose the entity's tax returns and other information concerning the entity that are required by the office and that would otherwise be subject to confidentiality under Section 59-1-403 or Section 6103, Internal Revenue Code, to the office.

    (b) The office shall submit the document described in Subsection (12)(a) to the State Tax Commission.
    (c) Upon receipt of the document described in Subsection (12)(a), the State Tax Commission shall provide the office with the information requested by the office that the entity authorized the State Tax Commission to provide to the office in the document described in Subsection (12)(a).  


23.    Page 16, Line 492 :    

             492          (d) If a qualified community development entity
{   engages in   }        makes       a distribution or debt


24.    Page 18, Lines 550 through 553 :    


             550          
{   (3) The office may not require a deposit from an applicant that:

             551          (a) has had proposed qualified equity investments certified under Section 63M-1-3403 ;
             552      and
             553          (b) has not forfeited a deposit made under this section.   }

25.    Page 22, Lines 651 through 654 :    

             651          63M-1-3411. Scope of part.
             652          This part applies only to a return or report originally due on or after
{   July 1   }        September 2       , 2014.

             653          Section 16. Effective date.
             654          This bill takes effect on
{   July 1   }        September 2       , 2014.

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