Bill Text: NY S04310 | 2011-2012 | General Assembly | Introduced
Bill Title: Provides a tax credit for certain investments in certified bank capital companies to provide venture capital for small business enterprises which have traditionally experienced difficulty in attracting institutional venture capital; creates a full framework for implementation.
Spectrum: Partisan Bill (Republican 2-0)
Status: (Introduced - Dead) 2012-01-18 - RECOMMIT, ENACTING CLAUSE STRICKEN [S04310 Detail]
Download: New_York-2011-S04310-Introduced.html
S T A T E O F N E W Y O R K
________________________________________________________________________
4310
2011-2012 Regular Sessions
I N S E N A T E
March 28, 2011
___________
Introduced by Sen. DeFRANCISCO -- read twice and ordered printed, and
when printed to be committed to the Committee on Investigations and
Government Operations
AN ACT to amend the tax law, in relation to providing banking corpo-
rations with a tax credit for investment in certified bank capital
companies
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
1 Section 1. Statement of legislative intent. The legislature finds
2 that, in order to promote the growth of the state economy, a need exists
3 to further encourage the investment of private financial resources into
4 the state's venture capital markets. This act creates incentives to
5 increase investment by banking corporations into venture capital funds
6 which invest in viable small business enterprises which have tradi-
7 tionally experienced difficulty in attracting institutional venture
8 capital. In addition, this act promotes the formation and expansion of
9 new and existing businesses, creating jobs, and resulting in the expan-
10 sion of the state's economy.
11 S 2. Section 1456 of the tax law is amended by adding a new subsection
12 (x) to read as follows:
13 (X) CREDIT FOR CERTAIN INVESTMENTS IN CERTIFIED BANK CAPITAL COMPA-
14 NIES. (1) A TAXPAYER SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS HERE-
15 INAFTER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTICLE. THE AMOUNT OF
16 THE CREDIT SHALL BE EQUAL TO ONE HUNDRED PERCENT OF AN INVESTMENT OF
17 CERTIFIED BANK CAPITAL MADE BY THE TAXPAYER PURSUANT TO SECTION THIRTY-
18 FIVE OF THIS CHAPTER.
19 (2) TEN PERCENT OF SUCH CREDIT SHALL BE ALLOWED IN THE TAXABLE YEAR TO
20 WHICH SUCH INVESTMENT IS ALLOCATED PURSUANT TO SUBDIVISION (J) OF
21 SECTION THIRTY-FIVE OF THIS CHAPTER AND IN EACH OF THE NINE FOLLOWING
22 TAXABLE YEARS. IN ADDITION, IN ANY TAXABLE YEAR SUBSEQUENT TO THE TAXA-
23 BLE YEAR FOR WHICH SUCH INVESTMENT IS SO ALLOCATED, ANY AMOUNT CARRIED
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD06164-01-1
S. 4310 2
1 FORWARD UNDER PARAGRAPHS THREE AND FOUR OF THIS SUBSECTION MAY BE
2 CARRIED FORWARD INDEFINITELY UNTIL SUCH CREDITS ARE UTILIZED.
3 (3) NO CREDIT ALLOWABLE PURSUANT TO THIS SUBSECTION SHALL REDUCE THE
4 TAX PAYABLE UNDER THIS ARTICLE TO LESS THAN THE MINIMUM FIXED BY
5 SUBSECTION (B) OF SECTION FOURTEEN HUNDRED FIFTY-FIVE OF THIS ARTICLE.
6 IF, HOWEVER, THE AMOUNT OF CREDIT ALLOWABLE UNDER THIS SUBSECTION FOR
7 ANY TAXABLE YEAR REDUCES THE TAX TO SUCH AMOUNT, ANY AMOUNT OF CREDIT
8 NOT TAKEN IN SUCH TAXABLE YEAR MAY BE CARRIED OVER TO THE FOLLOWING YEAR
9 OR YEARS AND MAY BE DEDUCTED FROM THE TAXPAYER'S TAX FOR SUCH YEAR OR
10 YEARS.
11 (4) IF FOR ANY TAXABLE YEAR THE CREDIT ALLOWABLE UNDER PARAGRAPH TWO
12 OF THIS SUBSECTION EXCEEDS SUCH MINIMUM TAX FOR SUCH TAXABLE YEAR, THEN
13 THE AMOUNT BY WHICH SUCH CREDIT EXCEEDS SUCH MINIMUM TAX LIABILITY SHALL
14 BE CARRIED FORWARD AS A CREDIT UNDER PARAGRAPH TWO OF THIS SUBSECTION TO
15 THE FOLLOWING YEAR OR YEARS AND MAY BE DEDUCTED FROM THE TAXPAYER'S TAX
16 FOR SUCH YEAR OR YEARS.
17 (5) DECERTIFICATION OF A CERTIFIED BANK CAPITAL COMPANY REQUIRES THE
18 DISALLOWANCE AND THE RECAPTURE OF THE CREDIT ALLOWED UNDER PARAGRAPH ONE
19 OF THIS SUBSECTION, AS FOLLOWS:
20 (A) DECERTIFICATION OF A CERTIFIED BANK CAPITAL COMPANY WITHIN TWO
21 YEARS OF ITS CERTIFICATION DATE AND PRIOR TO ITS MEETING THE REQUIRE-
22 MENTS OF SUBPARAGRAPH (A) OF PARAGRAPH ONE OF SUBDIVISION (C) OF SECTION
23 THIRTY-FIVE OF THIS CHAPTER SHALL CAUSE DISALLOWANCE OF ONE HUNDRED
24 PERCENT OF THE CREDIT ALLOWED UNDER PARAGRAPH ONE OF THIS SUBSECTION AND
25 THE RECAPTURE OF ANY PORTION OF SUCH CREDIT THAT WAS PREVIOUSLY TAKEN.
26 (B) DECERTIFICATION OF A CERTIFIED BANK CAPITAL COMPANY WHICH, HAVING
27 MET ALL REQUIREMENTS OF SUBPARAGRAPH (A) OF PARAGRAPH ONE OF SUBDIVISION
28 (C) OF SECTION THIRTY-FIVE OF THIS CHAPTER, SUBSEQUENTLY FAILS TO MEET
29 THE REQUIREMENTS FOR CONTINUED CERTIFICATION UNDER THE PROVISIONS OF
30 SUBPARAGRAPH (B) OF SUCH PARAGRAPH ONE REQUIRES THE DISALLOWANCE OF
31 EIGHTY-FIVE PERCENT OF THE CREDIT ALLOWED UNDER PARAGRAPH ONE OF THIS
32 SUBSECTION AND THE RECAPTURE OF ANY PORTION OF SUCH CREDIT IN EXCESS OF
33 FIFTEEN PERCENT THAT WAS PREVIOUSLY TAKEN.
34 (C) DECERTIFICATION OF A CERTIFIED BANK CAPITAL COMPANY WHICH, HAVING
35 MET ALL REQUIREMENTS OF SUBPARAGRAPHS (A) AND (B) OF PARAGRAPH ONE OF
36 SUBDIVISION (C) OF SECTION THIRTY-FIVE OF THIS CHAPTER, SUBSEQUENTLY
37 FAILS TO MEET THE REQUIREMENTS FOR CONTINUED CERTIFICATION UNDER THE
38 PROVISIONS OF SUBPARAGRAPH (C) OF SUCH PARAGRAPH ONE REQUIRES THE DISAL-
39 LOWANCE OF SEVENTY PERCENT OF THE CREDIT ALLOWED UNDER PARAGRAPH ONE OF
40 THIS SUBSECTION AND THE RECAPTURE OF ANY PORTION OF SUCH CREDIT IN
41 EXCESS OF THIRTY PERCENT THAT WAS PREVIOUSLY TAKEN.
42 (D) DECERTIFICATION OF A CERTIFIED BANK CAPITAL COMPANY PURSUANT TO
43 PARAGRAPH TWO OF SUBDIVISION (E) OF SECTION THIRTY-FIVE OF THIS CHAPTER,
44 OTHER THAN ON THE GROUNDS OF THE FAILURE OF SUCH CERTIFIED BANK CAPITAL
45 COMPANY TO MEET THE REQUIREMENTS OF SUBPARAGRAPH (A), (B), OR (C) OF
46 PARAGRAPH ONE OF SUBDIVISION (C) OF SUCH SECTION, DOES NOT REQUIRE THE
47 DISALLOWANCE OF ANY OF THE CREDITS ALLOWED UNDER PARAGRAPH ONE OF THIS
48 SUBSECTION NOR THE RECAPTURE OF ANY PORTION OF SUCH CREDITS THAT WAS
49 PREVIOUSLY TAKEN.
50 (6) REVOCATION OF CERTIFICATION PURSUANT TO SUBDIVISION (F) OF SECTION
51 THIRTY-FIVE OF THIS CHAPTER, BEFORE THE LATER OF (A) THE THIRD ANNIVER-
52 SARY OF THE CERTIFICATION OF THE CERTIFIED BANK CAPITAL COMPANY OR (B)
53 THE DATE ON WHICH THE CERTIFIED BANK CAPITAL COMPANY SATISFIES THE
54 REQUIREMENTS OF SUBPARAGRAPH (C) OF PARAGRAPH ONE OF SUBDIVISION (C) OF
55 SECTION THIRTY-FIVE OF THIS CHAPTER, REQUIRES DISALLOWANCE OF ONE
56 HUNDRED PERCENT OF THE CREDIT ALLOWED UNDER PARAGRAPH ONE OF THIS
S. 4310 3
1 SUBSECTION AND THE RECAPTURE OF ANY PORTION OF SUCH CREDIT THAT WAS
2 PREVIOUSLY TAKEN.
3 (7) NO CREDIT SHALL BE ALLOWED IN ANY TAX YEAR IN WHICH THE TAXPAYER
4 IS, INDIVIDUALLY OR WITH OR THROUGH ONE OR MORE AFFILIATES, A MANAGING
5 GENERAL PARTNER OF, OR EITHER UNDERWRITES OR CONTROLS THE DIRECTION OF
6 INVESTMENTS OF, A CERTIFIED BANK CAPITAL COMPANY FOR WHICH THE CREDIT
7 WAS ALLOWED UNDER PARAGRAPH ONE OF THIS SUBSECTION. THIS PROVISION SHALL
8 NOT PRECLUDE A CERTIFIED BANK INVESTOR OR ANY OTHER PARTY FROM EXERCIS-
9 ING ITS LEGAL RIGHTS AND REMEDIES (WHICH MAY INCLUDE INTERIM MANAGEMENT
10 OF A CERTIFIED BANK CAPITAL COMPANY) IN THE EVENT THAT A CERTIFIED BANK
11 CAPITAL COMPANY IS IN DEFAULT OF ITS STATUTORY OBLIGATIONS OR ITS
12 CONTRACTUAL OBLIGATIONS TO SUCH CERTIFIED BANK INVESTOR OR OTHER PARTY.
13 FOR PURPOSES OF THIS PARAGRAPH, "AFFILIATE" MEANS A BUSINESS ENTITY IN
14 WHICH THE TAXPAYER HOLDS AT LEAST A TEN PERCENT BENEFICIAL INTEREST.
15 S 3. The tax law is amended by adding a new section 35 to read as
16 follows:
17 S 35. CERTIFIED BANK CAPITAL COMPANIES. (A) DEFINITIONS. FOR THE
18 PURPOSE OF THIS SECTION AND SUBSECTION (X) OF SECTION FOURTEEN HUNDRED
19 FIFTY-SIX OF THIS CHAPTER, THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING
20 MEANINGS:
21 (1) "CERTIFICATION DATE" MEANS THE DATE ON WHICH A CERTIFIED BANK
22 CAPITAL COMPANY IS SO DESIGNATED BY THE DEPARTMENT.
23 (2) "CERTIFIED BANK CAPITAL" MEANS AN INVESTMENT OF CASH BY A CERTI-
24 FIED BANK INVESTOR IN A CERTIFIED BANK CAPITAL COMPANY WHICH FULLY FUNDS
25 THE PURCHASE PRICE OF EITHER OR BOTH ITS EQUITY INTEREST IN THE CERTI-
26 FIED BANK CAPITAL COMPANY OR A QUALIFIED DEBT INSTRUMENT ISSUED BY THE
27 CERTIFIED BANK CAPITAL COMPANY.
28 (3) "CERTIFIED BANK CAPITAL COMPANY" MEANS A PARTNERSHIP, CORPORATION,
29 TRUST, OR LIMITED LIABILITY COMPANY, ORGANIZED ON A FOR-PROFIT BASIS
30 THAT IS LOCATED, HEADQUARTERED, AND LICENSED OR REGISTERED TO CONDUCT
31 BUSINESS IN NEW YORK, THAT HAS AS ITS PRIMARY BUSINESS ACTIVITY THE
32 INVESTMENT OF CASH IN QUALIFIED BUSINESSES, AND THAT IS CERTIFIED BY THE
33 DEPARTMENT AS MEETING THE CRITERIA SET FORTH IN SUBDIVISION (B) OF THIS
34 SECTION.
35 (4) "CERTIFIED BANK INVESTOR" MEANS ANY BANKING CORPORATION DEFINED
36 PURSUANT TO SECTION FOURTEEN HUNDRED FIFTY-TWO OF THIS CHAPTER THAT
37 CONTRIBUTES CERTIFIED BANK CAPITAL.
38 (5) "DEPARTMENT" MEANS THE BANKING DEPARTMENT.
39 (6) "QUALIFIED BUSINESS" MEANS AN INDEPENDENTLY OWNED AND OPERATED
40 BUSINESS THAT MEETS ALL OF THE FOLLOWING CONDITIONS AS OF THE TIME OF
41 THE FIRST INVESTMENT IN THE BUSINESS:
42 (A) IT IS HEADQUARTERED IN NEW YORK STATE, AND ITS PRINCIPAL BUSINESS
43 OPERATIONS ARE LOCATED IN NEW YORK STATE, AND THE QUALIFIED INVESTMENT
44 IT RECEIVES IS USED SOLELY TO SUPPORT ITS BUSINESS OPERATIONS IN THE
45 STATE, EXCEPT FOR ADVERTISING, PROMOTIONS, AND SALES PURPOSES. IN CASES
46 WHERE THE QUALIFIED INVESTMENT IS MADE IN A START-UP COMPANY, SUCH CAPI-
47 TAL MUST BE USED SOLELY TO ESTABLISH AND SUPPORT ITS BUSINESS OPERATIONS
48 IN NEW YORK STATE, EXCEPT FOR ADVERTISING, PROMOTIONS, AND SALES
49 PURPOSES.
50 (B) IT HAS EITHER (I) NO MORE THAN ONE HUNDRED EMPLOYEES, AT LEAST
51 EIGHTY PERCENT OF WHOM ARE EMPLOYED IN NEW YORK STATE, OR (II) NO MORE
52 THAN TWO HUNDRED EMPLOYEES, AT LEAST EIGHTY PERCENT OF WHOM ARE EMPLOYED
53 IN THIS STATE, AND DURING THE FISCAL YEAR IMMEDIATELY PRECEDING THE
54 QUALIFIED INVESTMENT IT HAD, TOGETHER WITH ITS AFFILIATES, GROSS REVEN-
55 UES OF NO MORE THAN FIVE MILLION DOLLARS, ON A CONSOLIDATED BASIS, AS
56 DETERMINED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES.
S. 4310 4
1 (C) IT IS INVOLVED IN COMMERCE FOR THE PURPOSE OF DEVELOPING AND MANU-
2 FACTURING PRODUCTS AND SYSTEMS, INCLUDING BUT NOT LIMITED TO HIGH TECH-
3 NOLOGY PRODUCTS AND SYSTEMS SUCH AS COMPUTERS, COMPUTER SOFTWARE,
4 MEDICAL EQUIPMENT, BIOTECHNOLOGY, TELECOMMUNICATIONS EQUIPMENT AND
5 PRODUCTS, PROCESSING OR ASSEMBLING ALL TYPES OF PRODUCTS, CONDUCTING
6 RESEARCH AND DEVELOPMENT ON ALL TYPES OF PRODUCTS, OR PROVIDING
7 SERVICES, BUT EXCLUDING REAL ESTATE, REAL ESTATE DEVELOPMENT, INSURANCE,
8 AND BUSINESSES PREDOMINATELY ENGAGED IN PROFESSIONAL SERVICES PROVIDED
9 BY ACCOUNTANTS, LAWYERS, OR PHYSICIANS.
10 (7) "QUALIFIED DEBT INSTRUMENT" MEANS A DEBT INSTRUMENT ISSUED BY A
11 CERTIFIED BANK CAPITAL COMPANY, AT PAR VALUE OR A PREMIUM, WITH AN
12 ORIGINAL MATURITY DATE OF AT LEAST FIVE YEARS FROM DATE OF ISSUANCE, A
13 REPAYMENT SCHEDULE WHICH IS NOT FASTER THAN A LEVEL PRINCIPAL AMORTI-
14 ZATION, AND INTEREST, DISTRIBUTION, OR PAYMENT FEATURES WHICH ARE NOT
15 RELATED TO THE PROFITABILITY OF THE CERTIFIED BANK CAPITAL COMPANY OR
16 THE PERFORMANCE OF THE CERTIFIED BANK CAPITAL COMPANY'S INVESTMENT PORT-
17 FOLIO.
18 (8) "QUALIFIED DISTRIBUTION" MEANS ANY DISTRIBUTION OR PAYMENT TO
19 EQUITY HOLDERS OF A CERTIFIED BANK CAPITAL COMPANY IN CONNECTION WITH
20 THE FOLLOWING:
21 (A) REASONABLE COSTS AND EXPENSES OF SUCH EQUITY HOLDERS INCURRED BY
22 SUCH EQUITY HOLDERS IN CONNECTION WITH FORMING, SYNDICATING, MANAGING,
23 AND OPERATING THE CERTIFIED BANK CAPITAL COMPANY, INCLUDING AN ANNUAL
24 MANAGEMENT FEE IN AN AMOUNT THAT DOES NOT EXCEED TWO AND ONE-HALF
25 PERCENT OF THE CERTIFIED BANK CAPITAL OF THE CERTIFIED BANK CAPITAL
26 COMPANY, PLUS REASONABLE AND NECESSARY FEES PAID FOR PROFESSIONAL
27 SERVICES (SUCH AS LEGAL AND ACCOUNTING SERVICES) RELATED TO THE OPERA-
28 TION OF THE CERTIFIED BANK CAPITAL COMPANY; AND
29 (B) ANY INCREASE OR PROJECTED INCREASE IN FEDERAL OR STATE TAXES,
30 INCLUDING PENALTIES AND INTEREST RELATED TO STATE AND FEDERAL INCOME
31 TAXES, OF THE EQUITY OWNERS OF A CERTIFIED BANK CAPITAL COMPANY RESULT-
32 ING FROM THE EARNINGS OR OTHER TAX LIABILITY OF THE CERTIFIED BANK CAPI-
33 TAL COMPANY, TO THE EXTENT THAT THE INCREASE IS RELATED TO THE OWNER-
34 SHIP, MANAGEMENT, OR OPERATION OF A CERTIFIED BANK CAPITAL COMPANY.
35 (9) "QUALIFIED INVESTMENT" MEANS THE INVESTMENT OF CASH BY A CERTIFIED
36 BANK CAPITAL COMPANY IN A QUALIFIED BUSINESS FOR THE PURCHASE OF ANY
37 DEBT, EQUITY, OR HYBRID SECURITY, OF ANY NATURE AND DESCRIPTION WHATEV-
38 ER, INCLUDING A DEBT INSTRUMENT OR SECURITY WHICH HAS THE CHARACTER-
39 ISTICS OF DEBT BUT WHICH PROVIDES FOR CONVERSION INTO EQUITY OR EQUITY
40 PARTICIPATION INSTRUMENTS SUCH AS OPTIONS OR WARRANTS.
41 (10) "EARLY STAGE BUSINESS" MEANS A QUALIFIED BUSINESS WHICH IS
42 INVOLVED, AT THE TIME OF INVESTMENT, IN ACTIVITIES RELATED TO THE DEVEL-
43 OPMENT OF INITIAL PRODUCT OR SERVICE OFFERINGS, SUCH AS PROTOTYPE DEVEL-
44 OPMENT OR ESTABLISHMENT OF INITIAL PRODUCTION OR SERVICE PROCESSES, OR
45 WHICH IS LESS THAN TWO YEARS OLD AND DURING THE FISCAL YEAR IMMEDIATELY
46 PRECEDING THE QUALIFIED INVESTMENT HAD, TOGETHER WITH ITS AFFILIATES,
47 GROSS REVENUES OF NO MORE THAN TWO MILLION DOLLARS, ON A CONSOLIDATED
48 BASIS, AS DETERMINED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING
49 PRINCIPLES.
50 (11) "SUPERINTENDENT" MEANS THE SUPERINTENDENT OF BANKS.
51 (B) CERTIFICATION. (1) THE SUPERINTENDENT SHALL ESTABLISH BY RULE OR
52 REGULATION THE PROCEDURES FOR MAKING AN APPLICATION TO BECOME A CERTI-
53 FIED BANK CAPITAL COMPANY. THE APPLICANT SHALL PAY A NON-REFUNDABLE
54 APPLICATION FEE OF FIVE HUNDRED DOLLARS AT THE TIME OF FILING THE APPLI-
55 CATION WITH THE DEPARTMENT.
S. 4310 5
1 (2) THE SUPERINTENDENT MAY CERTIFY PARTNERSHIPS, CORPORATIONS, TRUSTS,
2 OR LIMITED LIABILITY COMPANIES, ORGANIZED ON A FOR PROFIT BASIS, WHICH
3 SUBMIT AN APPLICATION TO BE DESIGNATED AS A CERTIFIED BANK CAPITAL
4 COMPANY IF SUCH APPLICANT IS LOCATED, HEADQUARTERED, AND LICENSED OR
5 REGISTERED TO CONDUCT BUSINESS IN NEW YORK, HAS AS ITS PRIMARY BUSINESS
6 ACTIVITY THE INVESTMENT OF CASH IN QUALIFIED BUSINESSES, AND MEETS THE
7 OTHER CRITERIA SET FORTH IN THIS SUBDIVISION.
8 (3) A CERTIFIED BANK CAPITAL COMPANY'S INITIAL CAPITALIZATION, AT THE
9 TIME OF SEEKING CERTIFICATION, MUST BE FIVE HUNDRED THOUSAND DOLLARS OR
10 MORE.
11 (4) THE SUPERINTENDENT SHALL REVIEW THE ORGANIZATIONAL DOCUMENTS OF
12 EACH APPLICANT FOR CERTIFICATION AND THE BUSINESS HISTORY OF THE APPLI-
13 CANT, DETERMINE THAT THE APPLICANT'S CASH, MARKETABLE SECURITIES, AND
14 OTHER LIQUID ASSETS ARE AT LEAST FIVE HUNDRED THOUSAND DOLLARS, AND
15 DETERMINE THAT THE OFFICERS AND THE BOARD OF DIRECTORS, GENERAL PART-
16 NERS, TRUSTEES, MANAGERS, OR MEMBERS ARE TRUSTWORTHY AND ARE THOROUGHLY
17 ACQUAINTED WITH THE REQUIREMENTS OF THIS SUBDIVISION.
18 (5) THE SUPERINTENDENT SHALL VERIFY THAT AT LEAST TWO PRINCIPALS OF
19 THE CERTIFIED BANK CAPITAL COMPANY OR ANY MANAGER OF THE CERTIFIED BANK
20 CAPITAL COMPANY EACH HAVE NO LESS THAN FIVE YEARS OF EXPERIENCE IN THE
21 VENTURE CAPITAL OR A VENTURE CAPITAL-RELATED INDUSTRY.
22 (6) ANY OFFERING MATERIAL INVOLVING THE SALE OF SECURITIES OF THE
23 CERTIFIED BANK CAPITAL COMPANY SHALL INCLUDE THE FOLLOWING STATEMENT:
24 "THE AUTHORIZATION OF THE FORMATION OF A CERTIFIED BANK CAPITAL COMPA-
25 NY DOES NOT CONSTITUTE THE ENDORSEMENT OF THE STATE OF NEW YORK AS TO
26 EITHER THE QUALITY OF MANAGEMENT OR THE POTENTIAL FOR EARNINGS OF SUCH
27 COMPANY. THE STATE OF NEW YORK IS NOT LIABLE FOR DAMAGES OR LOSSES TO A
28 CERTIFIED BANK INVESTOR IN THE COMPANY. USE OF THE WORD 'CERTIFIED' IN
29 AN OFFERING DOES NOT CONSTITUTE A RECOMMENDATION OR ENDORSEMENT OF THE
30 INVESTMENT BY THE STATE OF NEW YORK.
31 INVESTMENTS IN A PROSPECTIVE CERTIFIED BANK CAPITAL COMPANY PRIOR TO
32 THE TIME SUCH COMPANY IS CERTIFIED ARE NOT ELIGIBLE FOR TAX CREDITS. IN
33 THE EVENT CERTAIN STATUTORY PROVISIONS (AS SPECIFIED IN SECTION 35 OF
34 THE TAX LAW) ARE VIOLATED, THE STATE OF NEW YORK MAY REQUIRE FORFEITURE
35 OF UNUSED TAX CREDITS AND REPAYMENT OF USED TAX CREDITS."
36 (7) WITHIN SIXTY DAYS OF APPLICATION, THE SUPERINTENDENT SHALL ISSUE
37 THE CERTIFICATION OR SHALL REFUSE THE CERTIFICATION AND COMMUNICATE IN
38 DETAIL TO THE APPLICANT THE GROUNDS FOR THE REFUSAL, INCLUDING
39 SUGGESTIONS FOR THE REMOVAL OF THOSE GROUNDS.
40 (C) REQUIREMENTS FOR CONTINUANCE OF CERTIFICATION. (1) TO CONTINUE TO
41 BE CERTIFIED, A CERTIFIED BANK CAPITAL COMPANY MUST MAKE QUALIFIED
42 INVESTMENTS ACCORDING TO THE FOLLOWING SCHEDULE:
43 (A) WITHIN TWO YEARS AFTER THE CERTIFICATION DATE OF A CERTIFIED BANK
44 CAPITAL COMPANY, AT LEAST TWENTY-FIVE PERCENT OF ITS CERTIFIED BANK
45 CAPITAL MUST BE PLACED IN QUALIFIED INVESTMENTS.
46 (B) WITHIN THREE YEARS AFTER THE CERTIFICATION DATE OF A CERTIFIED
47 BANK CAPITAL COMPANY, AT LEAST FORTY PERCENT OF ITS CERTIFIED BANK CAPI-
48 TAL MUST BE PLACED IN QUALIFIED INVESTMENTS.
49 (C) WITHIN FOUR YEARS AFTER THE CERTIFICATION DATE OF A CERTIFIED BANK
50 CAPITAL COMPANY, AT LEAST FIFTY PERCENT OF ITS CERTIFIED BANK CAPITAL
51 MUST BE PLACED IN QUALIFIED INVESTMENTS, AT LEAST FIFTY PERCENT OF WHICH
52 MUST HAVE BEEN PLACED IN EARLY STAGE BUSINESSES.
53 (D) A CERTIFIED BANK CAPITAL COMPANY, AT LEAST FIFTEEN WORKING DAYS
54 PRIOR TO MAKING A PROPOSED INVESTMENT IN A SPECIFIC BUSINESS, SHALL
55 CERTIFY IN WRITING TO THE SUPERINTENDENT THAT THE BUSINESS IN WHICH IT
56 PROPOSES TO INVEST MEETS THE DEFINITION OF A QUALIFIED BUSINESS SET
S. 4310 6
1 FORTH IN PARAGRAPH SIX OF SUBDIVISION (A) OF THIS SECTION OR, IN THE
2 CASE OF A FOLLOW-ON INVESTMENT, THAT SUCH BUSINESS CONTINUES TO MEET THE
3 REQUIREMENTS SET FORTH IN SUBPARAGRAPHS (A) AND (C) OF PARAGRAPH SIX OF
4 SUBDIVISION (A) OF THIS SECTION AND, IN EITHER CASE, AN EXPLANATION OF
5 ITS DETERMINATION THAT THE BUSINESS MEETS SUCH REQUIREMENTS. THE CERTIF-
6 ICATION TO THE SUPERINTENDENT SHALL INCLUDE A SWORN STATEMENT FROM THE
7 BUSINESS IN WHICH THE CERTIFIED BANK CAPITAL COMPANY PROPOSES TO INVEST,
8 WHICH STATEMENT SHALL EVIDENCE THE INTENTION OF THE BUSINESS TO MAINTAIN
9 ITS HEADQUARTERS IN NEW YORK AND CONDUCT ITS PRIMARY BUSINESS OPERATIONS
10 IN THE STATE OF NEW YORK AFTER ITS RECEIPT OF THE INVESTMENT BY THE
11 CERTIFIED BANK CAPITAL COMPANY. IF THE SUPERINTENDENT DETERMINES THAT
12 THE BUSINESS DOES NOT MEET THE DEFINITION OF A QUALIFIED BUSINESS OR, IN
13 THE CASE OF A FOLLOW-ON INVESTMENT, THAT SUCH BUSINESS DOES NOT MEET THE
14 REQUIREMENTS SET FORTH IN SUBPARAGRAPHS (A) AND (C) OF PARAGRAPH SIX OF
15 SUBDIVISION (A) OF THIS SECTION, THEN HE OR SHE SHALL, WITHIN THE
16 FIFTEEN WORKING DAY PERIOD PRIOR TO THE MAKING OF THE PROPOSED INVEST-
17 MENT, NOTIFY THE CERTIFIED BANK CAPITAL COMPANY OF HIS OR HER DETERMI-
18 NATION AND PROVIDE AN EXPLANATION THEREOF.
19 (E) ALL CERTIFIED BANK CAPITAL NOT PLACED IN QUALIFIED INVESTMENTS BY
20 THE CERTIFIED BANK CAPITAL COMPANY MAY BE HELD OR INVESTED IN SUCH
21 MANNER AS THE CERTIFIED BANK CAPITAL COMPANY, IN ITS DISCRETION, DEEMS
22 APPROPRIATE. THE PROCEEDS OF ALL CERTIFIED BANK CAPITAL RETURNED TO A
23 CERTIFIED BANK CAPITAL COMPANY AFTER BEING ORIGINALLY PLACED IN QUALI-
24 FIED INVESTMENTS MAY BE PLACED AGAIN IN QUALIFIED INVESTMENTS AND SHALL
25 COUNT TOWARD ANY REQUIREMENT IN THIS SUBDIVISION WITH RESPECT TO PLACING
26 CERTIFIED BANK CAPITAL IN QUALIFIED INVESTMENTS.
27 (2) ANY BUSINESS WHICH IS CLASSIFIED AS A QUALIFIED BUSINESS AT THE
28 TIME OF THE FIRST INVESTMENT IN SAID BUSINESS BY A CERTIFIED BANK CAPI-
29 TAL COMPANY SHALL REMAIN CLASSIFIED AS A QUALIFIED BUSINESS AND MAY
30 RECEIVE FOLLOW-ON INVESTMENTS FROM ANY CERTIFIED BANK CAPITAL COMPANY,
31 AND ANY SUCH FOLLOW-ON INVESTMENTS SHALL BE QUALIFIED INVESTMENTS
32 ALTHOUGH SUCH BUSINESS MAY NOT MEET THE DEFINITION OF A QUALIFIED BUSI-
33 NESS AT THE TIME OF SUCH FOLLOW-ON INVESTMENTS; PROVIDED, HOWEVER, THAT
34 SUCH BUSINESS CONTINUES TO MEET THE REQUIREMENTS SET FORTH IN SUBPARA-
35 GRAPHS (A) AND (C) OF PARAGRAPH SIX OF SUBDIVISION (A) OF THIS SECTION
36 AND REAFFIRMS ITS INTENTION TO MAINTAIN ITS HEADQUARTERS IN NEW YORK AND
37 CONDUCT ITS PRIMARY BUSINESS OPERATIONS IN THE STATE OF NEW YORK AS
38 REQUIRED IN SUBPARAGRAPH (D) OF PARAGRAPH ONE OF THIS SUBDIVISION.
39 (3) NO QUALIFIED INVESTMENT MAY BE MADE BY A CERTIFIED BANK CAPITAL
40 COMPANY TO THE EXTENT THAT SUCH INVESTMENT WOULD CAUSE THE COMPANY'S
41 TOTAL QUALIFIED INVESTMENT OUTSTANDING WITH RESPECT TO THE QUALIFIED
42 BUSINESS RECEIVING SUCH INVESTMENT TO EXCEED FIFTEEN PERCENT OF THE
43 TOTAL CERTIFIED BANK CAPITAL OF THE CERTIFIED BANK CAPITAL COMPANY AT
44 THE TIME OF SUCH INVESTMENT.
45 (4) DOCUMENTS AND OTHER MATERIALS SUBMITTED BY CERTIFIED BANK CAPITAL
46 COMPANIES OR BY BUSINESSES FOR PURPOSES OF THE CONTINUANCE OF CERTIF-
47 ICATION SHALL NOT BE PUBLIC RECORDS IF SUCH RECORDS ARE DETERMINED BY
48 THE SUPERINTENDENT TO BE TRADE OR BUSINESS SECRETS AND SHALL BE MAIN-
49 TAINED IN A CONFIDENTIAL MANNER BY THE SUPERINTENDENT.
50 (5) THE AGGREGATE CUMULATIVE AMOUNT OF ALL QUALIFIED INVESTMENTS MADE
51 BY A CERTIFIED BANK CAPITAL COMPANY FROM THE DATE OF ITS CERTIFICATION
52 SHALL BE CONSIDERED IN THE CALCULATION OF THE PERCENTAGE REQUIREMENTS
53 UNDER SUBPARAGRAPHS (A), (B), AND (C) OF PARAGRAPH ONE OF THIS SUBDIVI-
54 SION.
55 (6) EACH CERTIFIED BANK CAPITAL COMPANY SHALL REPORT THE FOLLOWING TO
56 THE SUPERINTENDENT:
S. 4310 7
1 (A) AS SOON AS PRACTICABLE AFTER THE RECEIPT OF CERTIFIED BANK CAPITAL
2 OR AN IRREVOCABLE FUNDING COMMITMENT SUBJECT ONLY TO THE RECEIPT OF AN
3 ALLOCATION PURSUANT TO SUBDIVISION (H) OF THIS SECTION, (I) THE NAME OF
4 EACH CERTIFIED BANK INVESTOR FROM WHICH THE CERTIFIED BANK CAPITAL WAS
5 RECEIVED, INCLUDING SUCH CERTIFIED BANK INVESTOR'S TAX IDENTIFICATION
6 NUMBER; (II) THE AMOUNT OF EACH CERTIFIED BANK INVESTOR'S INVESTMENT OF
7 CERTIFIED BANK CAPITAL; AND (III) THE DATE ON WHICH THE CERTIFIED BANK
8 CAPITAL WAS RECEIVED; PROVIDED HOWEVER, THAT NO SUCH REPORT SHALL BE
9 FILED WITH THE SUPERINTENDENT PRIOR TO MARCH FIRST, TWO THOUSAND TWELVE
10 FOR CERTIFIED BANK CAPITAL INVESTED AFTER SUCH DATE.
11 (B) ON AN ANNUAL BASIS, ON OR BEFORE JANUARY THIRTY-FIRST OF EACH
12 YEAR, (I) THE AMOUNT OF THE CERTIFIED BANK CAPITAL COMPANY'S CERTIFIED
13 BANK CAPITAL AT THE END OF THE IMMEDIATELY PRECEDING YEAR; (II) WHETHER
14 OR NOT THE CERTIFIED BANK CAPITAL COMPANY HAS INVESTED MORE THAN FIFTEEN
15 PERCENT OF ITS TOTAL CERTIFIED BANK CAPITAL IN ANY ONE BUSINESS; AND
16 (III) ALL QUALIFIED INVESTMENTS THAT THE CERTIFIED BANK CAPITAL COMPANY
17 MADE DURING THE PREVIOUS CALENDAR YEAR, INCLUDING THE NUMBER OF EMPLOY-
18 EES OF EACH QUALIFIED BUSINESS IN WHICH IT HAS MADE INVESTMENTS AT THE
19 TIME OF SUCH INVESTMENT.
20 (C) EACH CERTIFIED BANK CAPITAL COMPANY SHALL PROVIDE TO THE SUPER-
21 INTENDENT ANNUAL AUDITED FINANCIAL STATEMENTS, WHICH SHALL INCLUDE THE
22 OPINION OF AN INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT, WITHIN NINETY
23 DAYS OF THE CLOSE OF ITS FISCAL YEAR. THE AUDIT SHALL ADDRESS THE METH-
24 ODS OF OPERATION AND CONDUCT OF THE BUSINESS OF THE CERTIFIED BANK CAPI-
25 TAL COMPANY TO DETERMINE WHETHER OR NOT THE CERTIFIED BANK CAPITAL
26 COMPANY IS COMPLYING WITH THE APPLICABLE STATUTES AND PROGRAM RULES AND
27 WHETHER OR NOT THE FUNDS RECEIVED BY THE CERTIFIED BANK CAPITAL COMPANY
28 HAVE BEEN INVESTED AS REQUIRED UNDER SUBPARAGRAPHS (A), (B), AND (C) OF
29 PARAGRAPH ONE OF THIS SUBDIVISION.
30 (D) ON OR BEFORE APRIL FIRST OF EACH YEAR, EACH CERTIFIED BANK CAPITAL
31 COMPANY SHALL PAY AN ANNUAL, NON-REFUNDABLE CERTIFICATION FEE OF FIVE
32 HUNDRED DOLLARS TO THE SUPERINTENDENT; PROVIDED THAT NO SUCH FEE SHALL
33 BE REQUIRED WITHIN SIX MONTHS OF THE INITIAL CERTIFICATION DATE OF A
34 CERTIFIED BANK COMPANY.
35 (E) (1) WITHIN THIRTY DAYS OF THE DECISION ON AN APPLICATION FOR
36 CERTIFICATION PURSUANT TO SUBDIVISION (B) OF THIS SECTION, THE SUPER-
37 INTENDENT SHALL SUBMIT A COPY OF SUCH APPLICATION AND THE RELATED DECI-
38 SION TO THE DEPARTMENT OF TAXATION AND FINANCE. THE SUPERINTENDENT SHALL
39 SUBMIT A COPY OF ALL FILINGS OF CERTIFICATIONS PURSUANT TO SUBPARAGRAPH
40 (D) OF PARAGRAPH ONE OF THIS SUBDIVISION, AND ANY DETERMINATION MADE
41 THEREON, WITHIN FIFTEEN DAYS OF SUCH FILING TO THE DEPARTMENT OF TAXA-
42 TION AND FINANCE.
43 (2) THE SUPERINTENDENT SHALL ANNUALLY, BY MARCH FIRST, SUBMIT TO THE
44 DEPARTMENT OF TAXATION AND FINANCE A LIST OF CERTIFIED BANK INVESTORS
45 WHO MAY CLAIM THE TAX CREDIT FOR THE PREVIOUS TAXABLE YEAR AND ANY OTHER
46 INFORMATION NECESSARY TO ASSIST THE DEPARTMENT OF TAXATION AND FINANCE
47 TO DETERMINE ELIGIBILITY FOR SUCH TAX CREDIT.
48 (D) DISTRIBUTIONS. (1) A CERTIFIED BANK CAPITAL COMPANY MAY MAKE QUAL-
49 IFIED DISTRIBUTIONS AT ANY TIME. IN ORDER FOR A CERTIFIED BANK CAPITAL
50 COMPANY TO MAKE A DISTRIBUTION OTHER THAN A QUALIFIED DISTRIBUTION, TO
51 ITS EQUITY HOLDERS, EITHER (A) THE AGGREGATE CUMULATIVE AMOUNT OF ALL
52 QUALIFIED INVESTMENTS MUST EQUAL OR EXCEED ONE HUNDRED PERCENT OF ITS
53 CERTIFIED BANK CAPITAL ALLOCATED, OR (B) IT MUST HAVE RECEIVED WRITTEN
54 AUTHORIZATION TO MAKE SUCH DISTRIBUTION FROM THE SUPERINTENDENT. IN NO
55 EVENT, HOWEVER, SHALL ANY SUCH DISTRIBUTION, OTHER THAN A QUALIFIED
56 DISTRIBUTION, BE MADE BY A CERTIFIED BANK CAPITAL COMPANY UNLESS AN
S. 4310 8
1 AMOUNT EQUAL CUMULATIVELY TO AT LEAST NINETY PERCENT OF ITS CERTIFIED
2 BANK CAPITAL IS INVESTED IN COMPANIES THAT CONDUCT THEIR PRINCIPAL BUSI-
3 NESS OPERATIONS IN NEW YORK STATE.
4 (2) IN THE EVENT THAT A BUSINESS IN WHICH A QUALIFIED INVESTMENT IS
5 MADE RELOCATES ITS PRINCIPAL BUSINESS OPERATIONS TO ANOTHER STATE DURING
6 SUCH INVESTMENT, OR WITHIN THREE MONTHS AFTER THE TERMINATION OF SUCH
7 INVESTMENT, THE CUMULATIVE AMOUNT OF QUALIFIED INVESTMENT SHALL BE
8 REDUCED BY THE AMOUNT OF SUCH QUALIFIED INVESTMENT, FOR THE PURPOSES OF
9 THIS SUBDIVISION ONLY, UNLESS (A) THE CERTIFIED BANK CAPITAL COMPANY
10 INVESTS AN AMOUNT, AT LEAST EQUAL TO THE INVESTMENT OF CERTIFIED BANK
11 CAPITAL IN THE RELOCATED BUSINESS IN A QUALIFIED BUSINESS LOCATED IN NEW
12 YORK STATE WITHIN SIX MONTHS OF THE RELOCATION OR (B) UNLESS THE BUSI-
13 NESS DEMONSTRATES THAT IT HAS RETURNED ITS PRINCIPAL BUSINESS OPERATIONS
14 TO NEW YORK STATE WITHIN THREE MONTHS OF SUCH RELOCATION. A BUSINESS
15 SHALL BE DEEMED TO HAVE RELOCATED ITS PRINCIPAL BUSINESS OPERATIONS
16 OUTSIDE NEW YORK STATE IF THE PRIMARY WORKPLACE OF MORE THAN FIFTY
17 PERCENT OF THE EMPLOYEES OF SUCH BUSINESS EMPLOYED WITHIN THE STATE ARE
18 RELOCATED TO ANOTHER STATE.
19 (3) PAYMENTS TO DEBT HOLDERS OF A CERTIFIED BANK CAPITAL COMPANY MAY
20 BE MADE WITHOUT RESTRICTION WITH RESPECT TO REPAYMENTS OF PRINCIPAL AND
21 INTEREST ON INDEBTEDNESS OWED TO THEM BY A CERTIFIED BANK CAPITAL COMPA-
22 NY, INCLUDING INDEBTEDNESS OF THE CERTIFIED BANK CAPITAL COMPANY ON
23 WHICH CERTIFIED BANK INVESTORS EARNED TAX CREDITS. A DEBT HOLDER THAT IS
24 ALSO A CERTIFIED BANK INVESTOR OR EQUITY HOLDER OF A CERTIFIED BANK
25 CAPITAL COMPANY MAY RECEIVE PAYMENTS WITH RESPECT TO SUCH DEBT WITHOUT
26 ANY RESTRICTION WHATSOEVER.
27 (E) DECERTIFICATION. (1) THE SUPERINTENDENT SHALL CONDUCT AN ANNUAL
28 REVIEW OF EACH CERTIFIED BANK CAPITAL COMPANY TO DETERMINE WHETHER OR
29 NOT THE CERTIFIED BANK CAPITAL COMPANY IS ABIDING BY THE REQUIREMENTS OF
30 CERTIFICATION, TO ADVISE THE CERTIFIED BANK CAPITAL COMPANY AS TO THE
31 ELIGIBILITY STATUS OF ITS QUALIFIED INVESTMENTS, AND TO ENSURE THAT NO
32 INVESTMENT HAS BEEN MADE IN VIOLATION OF THIS SUBDIVISION. THE COST OF
33 THE ANNUAL REVIEW SHALL BE PAID BY EACH CERTIFIED BANK CAPITAL COMPANY
34 ACCORDING TO A REASONABLE FEE SCHEDULE ADOPTED BY THE SUPERINTENDENT.
35 (2) ANY MATERIAL VIOLATION OF SUBDIVISION (C) OF THIS SECTION SHALL BE
36 GROUNDS FOR DECERTIFICATION OF THE CERTIFIED BANK CAPITAL COMPANY. IF
37 THE SUPERINTENDENT DETERMINES THAT A CERTIFIED BANK CAPITAL COMPANY IS
38 NOT IN COMPLIANCE WITH THE REQUIREMENTS OF SUBDIVISION (C) OF THIS
39 SECTION, HE OR SHE SHALL, BY WRITTEN NOTICE, INFORM THE OFFICERS OF THE
40 CERTIFIED BANK CAPITAL COMPANY THAT THE CERTIFIED BANK CAPITAL COMPANY
41 WILL BE SUBJECT TO DECERTIFICATION IN ONE HUNDRED TWENTY DAYS FROM THE
42 DATE OF THE MAILING OF THE NOTICE, UNLESS THE DEFICIENCIES ARE CORRECTED
43 AND THE CERTIFIED BANK CAPITAL COMPANY IS AGAIN IN COMPLIANCE WITH ALL
44 REQUIREMENTS FOR CERTIFICATION.
45 (3) AT THE END OF THE ONE HUNDRED TWENTY DAY GRACE PERIOD, IF THE
46 CERTIFIED BANK CAPITAL COMPANY IS STILL NOT IN COMPLIANCE WITH SUBDIVI-
47 SION (C) OF THIS SECTION, THE SUPERINTENDENT SHALL SEND A NOTICE OF
48 DECERTIFICATION TO THE CERTIFIED BANK CAPITAL COMPANY AND TO ALL OTHER
49 APPROPRIATE STATE AGENCIES.
50 (4) ONCE A CERTIFIED BANK CAPITAL COMPANY HAS INVESTED AN AMOUNT
51 CUMULATIVELY EQUAL TO ONE HUNDRED PERCENT OF ITS CERTIFIED BANK CAPITAL
52 IN QUALIFIED INVESTMENTS AND HAS MET ALL OTHER REQUIREMENTS UNDER THIS
53 SUBDIVISION, THE CERTIFIED BANK CAPITAL COMPANY SHALL NO LONGER BE
54 SUBJECT TO REGULATION BY THE SUPERINTENDENT AND SHALL NO LONGER BE
55 SUBJECT TO THE REQUIREMENTS OF SUBDIVISION (C) OF THIS SECTION.
S. 4310 9
1 (5) THE SUPERINTENDENT SHALL SEND WRITTEN NOTICE OF SUCH DECERTIF-
2 ICATION TO THE ADDRESS OF EACH CERTIFIED BANK INVESTOR WHOSE TAX CREDIT
3 HAS BEEN SUBJECT TO RECAPTURE OR FORFEITURE, USING THE ADDRESS SHOWN ON
4 THE LAST FILING SUBMITTED TO THE SUPERINTENDENT.
5 (F) REVOCATION OF CERTIFICATION. THE SUPERINTENDENT MAY REVOKE THE
6 CERTIFICATION OF A CERTIFIED BANK CAPITAL COMPANY IF ANY MATERIAL REPRE-
7 SENTATION TO THE SUPERINTENDENT IN CONNECTION WITH THE APPLICATION PROC-
8 ESS PROVES TO HAVE BEEN FALSELY MADE OR IF THE APPLICATION MATERIALLY
9 VIOLATES ANY REQUIREMENT ESTABLISHED BY THE SUPERINTENDENT PURSUANT TO
10 THIS SECTION.
11 (G) REGISTRATION REQUIREMENTS. ALL INVESTMENTS FOR WHICH TAX CREDITS
12 ARE ALLOWABLE UNDER THE PROVISIONS OF SUBSECTION (U) OF SECTION FOURTEEN
13 HUNDRED FIFTY-SIX OF THIS CHAPTER SHALL SATISFY THE CONDITIONS OF BEING
14 REGISTERED OR SPECIFICALLY EXEMPT FROM REGISTRATION BY PROVISIONS OR
15 REGULATIONS UNDER SECTIONS THREE HUNDRED FIFTY-NINE-E THROUGH THREE
16 HUNDRED FIFTY-NINE-FF OF ARTICLE TWENTY-THREE-A OF THE GENERAL BUSINESS
17 LAW.
18 (H) MAXIMUM PERMITTED CREDITS. THE AGGREGATE AMOUNT OF CERTIFIED BANK
19 CAPITAL FOR WHICH TAXPAYERS MAY BE ALLOCATED AND ALLOWED TAX CREDITS
20 PURSUANT TO THIS SECTION AND SUBSECTION (X) OF SECTION FOURTEEN HUNDRED
21 FIFTY-SIX OF THIS CHAPTER MAY NOT EXCEED FIFTY MILLION DOLLARS FOR
22 CALENDAR YEAR TWO THOUSAND THIRTEEN, WHICH CERTIFIED BANK CAPITAL MAY BE
23 INVESTED IN CERTIFIED BANK CAPITAL COMPANIES BEGINNING IN CALENDAR YEAR
24 TWO THOUSAND TEN. IN CALENDAR YEAR TWO THOUSAND FOURTEEN OR THEREAFTER,
25 TAX CREDITS MAY BE ALLOWED PURSUANT TO THIS SECTION AND SUCH SUBSECTION
26 (X) OF SECTION FOURTEEN HUNDRED FIFTY-SIX OF THIS CHAPTER FOR AN ADDI-
27 TIONAL FIFTY MILLION DOLLARS OF CERTIFIED BANK CAPITAL, WHICH CERTIFIED
28 BANK CAPITAL MAY BE INVESTED IN CERTIFIED BANK CAPITAL COMPANIES BEGIN-
29 NING IN CALENDAR YEAR TWO THOUSAND THIRTEEN, IF NOT ALLOCATED TO CALEN-
30 DAR YEAR TWO THOUSAND TWELVE IN ACCORDANCE WITH THIS SUBDIVISION. THERE-
31 FORE, THE TOTAL AMOUNT OF CERTIFIED BANK CAPITAL FOR WHICH TAX CREDITS
32 MAY BE ALLOWED PURSUANT TO THIS SECTION AND SUCH SUBSECTION (X) OF
33 SECTION FOURTEEN HUNDRED FIFTY-SIX SHALL BE ONE HUNDRED MILLION DOLLARS.
34 DURING ANY CALENDAR YEAR IN WHICH THE LIMITATION DESCRIBED IN THIS
35 SUBDIVISION WILL LIMIT THE AMOUNT OF CERTIFIED BANK CAPITAL, CERTIFIED
36 BANK CAPITAL SHALL BE ALLOCATED IN ORDER OF PRIORITY BASED UPON THE DATE
37 OF FILING OF INFORMATION DESCRIBED IN SUBPARAGRAPH (A) OF PARAGRAPH SIX
38 OF SUBDIVISION (C) OF THIS SECTION. CERTIFIED BANK CAPITAL LIMITED IN
39 ANY CALENDAR YEAR BY THE APPLICATION OF THE PROVISIONS OF THIS SUBDIVI-
40 SION SHALL BE ALLOWED AND ALLOCATED IN THE IMMEDIATELY SUCCEEDING CALEN-
41 DAR YEAR IN ORDER OF PRIORITY SET FORTH IN THIS SUBDIVISION. THE SUPER-
42 INTENDENT SHALL ADVISE ANY CERTIFIED BANK CAPITAL COMPANY, IN WRITING,
43 WITHIN FIFTEEN DAYS AFTER RECEIVING SUCH FILING, WHETHER OR NOT THE
44 LIMITATIONS OF THIS SUBDIVISION THEN IN EFFECT WILL BE APPLICABLE WITH
45 RESPECT TO THE INVESTMENTS AND CREDITS DESCRIBED IN SUCH FILING WITH THE
46 SUPERINTENDENT.
47 CERTIFIED BANK CAPITAL MAY BE RAISED BY EACH CERTIFIED BANK CAPITAL
48 COMPANY AT ANY TIME SUBSEQUENT TO ITS CERTIFICATION DATE, AND CREDITS
49 SHALL BE ALLOCATED TO AND VESTED IN CERTIFIED BANK INVESTORS AT THE TIME
50 OF EACH SUCH INVESTMENT AS PROVIDED IN THIS SUBDIVISION, ALTHOUGH SUCH
51 CREDITS SHALL NOT BE FIRST ALLOWED OR INCURRED FOR STATE TAX PURPOSES,
52 UNTIL, AT THE EARLIEST, TAX YEARS BEGINNING IN TWO THOUSAND THIRTEEN
53 WITH RESPECT TO THE FIRST FIFTY MILLION DOLLARS OF CREDITS AND TAX YEARS
54 BEGINNING IN TWO THOUSAND FOURTEEN WITH RESPECT TO THE NEXT SUCH FIFTY
55 MILLION DOLLARS OF CREDITS.
S. 4310 10
1 (I) MAXIMUM CERTIFIED BANK CAPITAL. THE MAXIMUM AMOUNT OF CERTIFIED
2 BANK CAPITAL INVESTED IN ONE OR MORE CERTIFIED BANK CAPITAL COMPANIES
3 ALLOWED IN ANY ONE YEAR TO ANY ONE CERTIFIED BANK INVESTOR SHALL NOT
4 EXCEED TEN MILLION DOLLARS FOR SUCH YEAR; PROVIDED, HOWEVER, THAT IF THE
5 AGGREGATE AMOUNT OF CERTIFIED BANK CAPITAL FOR SUCH YEAR, AS SET FORTH
6 IN SUBDIVISION (H) OF THIS SECTION, HAS NOT BEEN REACHED SIXTY DAYS
7 PRIOR TO THE END OF THE YEAR TO WHICH SUCH AGGREGATE AMOUNT APPLIES, THE
8 PROVISIONS OF THIS SUBDIVISION SHALL CEASE TO APPLY FOR THE REMAINDER OF
9 SUCH YEAR. IN ADDITION, THE AGGREGATE AMOUNT OF TAX CREDITS ALLOWED IN
10 ANY TAXABLE YEAR TO ANY AFFILIATED GROUP OF TAXPAYERS IN RELATION TO
11 CERTIFIED BANK CAPITAL MAY NOT EXCEED TEN MILLION DOLLARS, WHETHER OR
12 NOT SUCH TAXPAYERS FILE A COMBINED RETURN PURSUANT TO SUBSECTION (F) OF
13 SECTION FOURTEEN HUNDRED SIXTY-TWO OF THIS CHAPTER. FOR PURPOSES OF THE
14 PRECEDING SENTENCE, THE TERM "AFFILIATED GROUP" SHALL HAVE THE SAME
15 MEANING AS DESCRIBED IN SECTION 1504 OF THE INTERNAL REVENUE CODE,
16 EXCEPT THAT THE REFERENCES TO "AT LEAST EIGHTY PERCENT" IN SUCH SECTION
17 1504 SHALL BE READ AS "MORE THAN FIFTY PERCENT".
18 (J) REPORTS. THE SUPERINTENDENT SHALL REPORT TO THE GOVERNOR, THE
19 TEMPORARY PRESIDENT OF THE SENATE, AND THE SPEAKER OF THE ASSEMBLY, ON
20 OR BEFORE JUNE FIRST OF EACH YEAR BEGINNING IN THE YEAR TWO THOUSAND
21 FOURTEEN, THE NUMBER OF CERTIFIED BANK CAPITAL COMPANIES HOLDING CERTI-
22 FIED BANK CAPITAL; THE AMOUNT OF CERTIFIED BANK CAPITAL INVESTED IN EACH
23 CERTIFIED BANK CAPITAL COMPANY; THE CUMULATIVE AMOUNT THAT EACH CERTI-
24 FIED BANK CAPITAL COMPANY HAS INVESTED AS OF JANUARY FIRST OF THE YEAR
25 TWO THOUSAND FOURTEEN AND THE CUMULATIVE TOTAL EACH YEAR THEREAFTER; THE
26 TOTAL AMOUNT OF TAX CREDITS GRANTED UNDER THIS SECTION EACH YEAR THAT
27 CREDITS HAVE BEEN AWARDED UNDER THIS SECTION AND SUBSECTION (X) OF
28 SECTION FOURTEEN HUNDRED FIFTY-SIX OF THIS CHAPTER; THE PERFORMANCE OF
29 EACH CERTIFIED BANK CAPITAL COMPANY WITH REGARD TO THE REQUIREMENTS FOR
30 RECERTIFICATION SET FORTH IN SUBDIVISION (C) OF THIS SECTION; THE CLAS-
31 SIFICATION OF COMPANIES IN WHICH EACH CERTIFIED BANK CAPITAL COMPANY HAS
32 INVESTED ACCORDING TO INDUSTRIAL SECTOR AND SIZE OF COMPANY; THE TOTAL
33 NUMBER OF JOBS CREATED BY INVESTMENTS MADE BY EACH CERTIFIED BANK CAPI-
34 TAL COMPANY USING CERTIFIED BANK CAPITAL; AND THOSE CERTIFIED BANK CAPI-
35 TAL COMPANIES THAT HAVE BEEN DECERTIFIED, OR HAVE HAD THEIR CERTIF-
36 ICATIONS REVOKED, INCLUDING THE REASONS FOR DECERTIFICATION OR
37 REVOCATION.
38 (K) RULES AND REGULATIONS. THE SUPERINTENDENT, IN CONSULTATION WITH
39 THE DEPARTMENT OF TAXATION AND FINANCE, SHALL PRESCRIBE SUCH RULES AND
40 REGULATIONS AS HE OR SHE SHALL DEEM NECESSARY IN ORDER TO IMPLEMENT THE
41 PROVISIONS OF THIS SECTION WITHIN ONE HUNDRED TWENTY DAYS OF THE EFFEC-
42 TIVE DATE OF THIS SECTION.
43 S 4. This act shall take effect immediately.
