Scroll to History Page
Scroll to Previous Versions Links List
Scroll to Full Text
Download This Bill in Microsoft Word format
Current Status Bill Number:View additional legislative information at the LPITS web site.607 Type of Legislation:General Bill GB Introducing Body:Senate Introduced Date:20010424 Primary Sponsor:Matthews All Sponsors:Matthews Drafted Document Number:l:\council\bills\skb\18411som01.doc Residing Body:Senate Current Committee:Finance Committee 06 SF Subject:Community investment account, development; Commerce, Banks, Businesses, Economic Development, Taxation History Body Date Action Description Com Leg Involved ______ ________ ______________________________________ _______ ____________ Senate 20010424 Introduced, read first time, 06 SF referred to Committee Versions of This Bill
TO AMEND SECTION 34-43-20, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO DEFINITIONS FOR PURPOSES OF THE SOUTH CAROLINA ECONOMIC DEVELOPMENT ACT, SO AS TO INCLUDE A DEFINITION FOR "COMMUNITY INVESTMENT ACCOUNT"; TO AMEND SECTION 34-43-30, RELATING TO DUTIES AND RESPONSIBILITIES OF THE DEPARTMENT OF COMMERCE IN CONNECTION WITH THE ECONOMIC DEVELOPMENT ACT, SO AS TO PROVIDE FOR GRANTS AND LOANS TO INCLUDE PRIVATE CONTRIBUTIONS AND OTHER SOURCES OF MONIES IN THE COMMUNITY INVESTMENT ACCOUNT; AND TO AMEND SECTION 12-6-3530, RELATING TO COMMUNITY DEVELOPMENT TAX CREDITS AGAINST THE STATE INCOME TAX, SO AS TO INCLUDE REFERENCES TO INVESTMENT IN THE COMMUNITY INVESTMENT ACCOUNT AS A BASIS FOR THE CREDIT.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Section 34-43-20 of the 1976 Code, as added by Act 314 of 2000, is amended to read:
"Section 34-43-20. As used in this chapter:
(1) 'Department' means the South Carolina Department of Commerce.
(2) 'Community development corporation' means a nonprofit corporation which:
(a) is chartered pursuant to Chapter 31, Title 33;
(b) is tax exempt pursuant to Section 501(c)(3) of the Internal Revenue Code of 1986, as amended;
(c) has a primary mission of developing and improving low-income communities and neighborhoods through economic and related development;
(d) has activities and decisions initiated, managed, and controlled by the constituents of those local communities;
(e) has a primary function of developing projects and activities designed to enhance the economic opportunities of the people in the community served, including efforts to enable them to become owners and managers of small businesses and producers of affordable housing and jobs in the community served;
(f) does not provide credit, capital, or other assistance from public funds in an amount greater than twenty-five thousand dollars at one time or in one transaction. The department may adjust that dollar amount in the manner provided in Section 37-1-109; and
(g) is not a nonprofit organization with the sole purpose of providing housing to neighborhoods or technical assistance to other nonprofit organizations.
(3) 'Community development financial institution' means an organization that:
(a) has a primary mission of promoting community development by providing credit, capital, or development services to small businesses or home mortgage assistance to individuals including, but not limited to, capital access programs, microlending, franchise financing, and guaranty performance bonds;
(b) maintains, through representation on its governing board, accountability to persons in need of the institution's services;
(c) is not an agent or instrumentality of the United States, or of a state or political subdivision of a state nor maintains an affiliate relationship with any of them;
(d) maintains a goal of providing a majority of its services to low-income individuals, minorities, females, or rural areas;
(e) provides capital and technical assistance to small and micro businesses or mortgage assistance to individuals;
(f) does not provide credit, capital, or other assistance in an amount greater than two hundred fifty thousand dollars at one time or in one transaction. That dollar amount may be adjusted in the manner provided in Section 37-1-109;
(g) has been certified or recertified as a community development financial institution as provided in this chapter; and
(h) may be a federally-chartered or state-chartered financial institution holding company which qualifies as a community development financial institution only if the holding company and the subsidiaries and affiliates of the holding company collectively satisfy the requirements of this section.
(4) 'Community investment account' means an account directed and controlled by the department through which a taxpayer may invest funds pursuant to this chapter and from which the department may make grants for the benefit of community development corporations and community development financial institutions as provided in Section 34-43-30(A)(2).
(5) 'Low income' means an income level that falls within the eightieth percentile of the mean income for a family of similar size within this State.
(5)(6) The term 'invest' or 'investment' includes an advance of funds to a community development corporation, or a community development financial institution, or the community investment account'."
SECTION 2. Section 34-43-30(A)(2) of the 1976 Code, as added by Act 314 of 2000, is amended to read:
"(2) administering grants and loans to community development corporations and community development financial institutions from grant funds made available to it by the General Assembly for that purpose or from funds available in the community investment account received from private contributions or other sources; and"
SECTION 3. Section 12-6-3530 of the 1976 Code, as added by Act 314 of 2000, is amended to read:
"Section 12-6-3530. (A) A taxpayer may claim as a credit against his state income tax, bank tax, or premium tax liability thirty-three percent of all amounts invested in a community development corporation, or in a community development financial institution, or in the community investment account, as defined in Section 34-43-20(2), or (3), or (4).
To qualify for this credit the taxpayer must obtain a certificate from the South Carolina Department of Commerce certifying that the entity into which the funds are invested is a community development corporation, or a community development financial institution, or the community investment account within the meaning of Section 34-43-20(2), or (3), or (4) and certifying that the credit taken or available to that taxpayer will not exceed the aggregate five million dollar limitation of all those credits as provided in subsection (B) when added to the credits previously taken or available to other taxpayers making similar investments. A taxpayer who invested in good faith in a certified corporation or institution or in the community investment account may claim the credit provided in this section, notwithstanding the fact that the certification in the corporation or institution is later revoked or not renewed by the department.
(B) The total amount of credits allowed pursuant to this section may not exceed in the aggregate five million dollars for all taxpayers and all taxable years and one million dollars for all taxpayers in one taxable year.
(C) A single community development corporation or community development financial institution may not receive more than twenty-five percent of the total tax credits authorized pursuant to this section in any one taxable year.
(D) The department shall monitor the investments made by taxpayers in community development corporations, and community development financial institutions, and the community investment account as permitted by this section and shall perform the functions as provided in subsection (A) above.
(E) If the amount of the credit determined, pursuant to subsection (A), exceeds the taxpayer's state tax liability for the applicable taxable year, the taxpayer may carry over the excess to the immediately succeeding taxable years. However, the credit carry-over may not be used for a taxable year that begins on or after ten years from the date of the acquisition of stock or other equity interest investment that is the basis for a credit pursuant to this section. The amount of the credit carry-over from a taxable year must be reduced to the extent that the carry-over is used by the taxpayer to obtain a credit provided for in this section for a later taxable year.
(F) Notwithstanding the provisions of subsections (A), (B), (C), (D), and (E) above, if on April 1, 2001, or as soon after that as the department is able to determine, the total amount of tax credits which may be claimed by all taxpayers exceeds the total amount of tax credits authorized by this section, the credits must be determined on a pro rata basis. For purposes of this subsection, a community development corporation or community development financial institution for which an investment may be claimed as a tax credit pursuant to this section must report all investments made before April 1, 2001, to the department by April 1, 2001, which shall inform, as soon as reasonably possible, all community development corporations and community development financial institutions of the total of all investments in all institutions and corporations and in the community investment account as of April 1, 2001.
(G) If stock or another equity interest the investment that is the basis for a credit provided for in this section is redeemed by the community development corporation or the community development financial institution within five years of the date it is acquired the investment is made, the credit provided by this section for the stock or other equity interest investment is disallowed, and credit previously claimed and allowed with respect to the redeemed stock or other equity interest investment must be paid to the Department of Revenue with the appropriate return of the taxpayer covering the period in which the redemption occurred. When payments are made to the Department of Revenue pursuant to this section, the amount collected must be handled as if no credit had been allowed.
(H) To receive the credit provided by this section, a taxpayer shall:
(1) claim the credit on his annual state income or premium tax return as prescribed by the Department of Revenue; and
(2) file with the Department of Revenue and with his annual state income or premium tax return a copy of the form issued by the department as to the stock or other equity interest investment that is the basis for a credit claimed pursuant to this section, by the taxpayer, including, if applicable, an undertaking by the taxpayer to report to the Department of Revenue a redemption of the stock or other equity interest investment by the community development corporation or the community development financial institution.
(I) The department shall complete forms prescribed by the Department of Revenue which that must show as to each stock or other equity interest investment in a community development corporation, or a community development financial institution, or the community investment account that is the basis for a credit pursuant to this section:
(1) the name, address, and identification number of the taxpayer who acquired the stock or other equity interest made the investment; and
(2) the nature and amount of the stock or other equity interest acquired by the taxpayer and the amount advanced for it investment made by the taxpayer.
These forms must be filed with the Department of Revenue on or before the fifteenth day of the third month following the month in which the stock or other equity interest is acquired investment is made. Copies of the forms to be provided to the Department of Revenue must be mailed to the taxpayer on or before the fifteenth day of the second month following the month in which the acquisition investment is made.
(J) A taxpayer may not claim the tax credit provided in this section unless the community development corporation or community development financial institution in which the investment is made has been certified at the time the investment is made.
(K) If the community development financial institution in which the investment is made is a tax-exempt nonprofit corporation, the tax credit provided in this section is not allowed if the taxpayer claims the investment as a deduction pursuant to Section 170 of the Internal Revenue Code.
(L) Banks and financial institutions chartered by the State of South Carolina may invest in community development corporations and community development financial institutions incorporated pursuant to the laws of this State, up to a maximum of ten percent of a chartered bank or financial institution's total capital and surplus."
SECTION 4. This section takes effect July 1, 2001, except that SECTION 3 is applicable to tax years beginning after 2001.
This web page was last updated on
Tuesday, December 8, 2009 at 11:13 A.M.