Source: http://www.novoco.com/new_markets/nmtc/state_nmtc_programs.php
Timestamp: 2016-05-31 19:54:23
Document Index: 518904692

Matched Legal Cases: ['§281', '§44', '§15', '§288', '§141', '§1911', '§1912', '§1100', '§57', '§77', '§231', '§5725', '§315']

State NMTC Programs
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Home / New Markets / Nmtc
New Markets Development Tax Credit Program
H.B. 257 Amending Legislation
Alabama Code §281-5-1
Needs to be a CDE for federal purposes that included Alabama in its service area and has received an allocation of federal NMTCs. Annual State CAP Limits
$10 Million QLICI per QALICB Credit Description
50 percent of the taxpayer's equity investment
Year 1: 0%, Years 2-7: 8.33%
7 years (same as federal)
QALICB Requirements
The following events cause recapture: The federal NMTCs associated with a QEI are recaptured (recapture amount proportionate to the federal recapture); The CDE fails to invest 85% of a QEI within 12 months and maintain such level of investment until the last credit allowance date for such QEI (recapture amount equal to all credits claimed);
The CDE redeems or makes a principal payment with respect to a QEI prior to the seventh anniversary of a QEI (recapture amount proportionate to the amount of redemption or repayment).
Not sellable or transferable.	Tax credits earned by a partnership, limited liability company, S corporation, or other "pass-through" entity may be allocated to the partners, members or shareholders of that entity for their direct use in accordance with the provisions of any agreement among the partners, members or shareholders. Credit may be carried forward to any of the taxpayer's subsequent taxable years.
An Introduction the New Markets Tax Credit Program, Schedule OC, Alabama Taxes and Incentives, Form ET-1
Brad Elphick
Linda.Swann@commerce.alabama.gov	(334) 353-0221
New Markets Tax Credit Assistance Guarantee and Loan Program
Alaska Statutes §44.88.700
The applicant must have been awarded a NMTC allocation from a CDE, or be in the process of securing that allocation from one or more CDE’s. The applicant may then apply to AIDEA for a guarantee of the leveraged loan portion of the NMTC transaction. If, and when, AIDEA issues a Letter of Commitment, the applicant can use it to secure a commercial loan to the transaction from an eligible financial institution. If a loan is secured, AIDEA will work with the lender to ensure the terms and conditions of the guarantee and the loan are compatible and acceptable to both parties. The guarantee will be executed at the closing of the NMTC transaction.
AIDEA may make a loan under this program only if it determines that the applicant was unable to use AIDEA’s Letter of Commitment to obtain a loan from a financial institution under commercially reasonable terms. In this case the applicant will be required to submit documentation demonstrating that at least two financial institutions have reviewed and rejected a loan application or that the application was approved but subject to terms AIDEA determines are commercially unreasonable.
Annual State CAP Limits
The project must be located within a census tract that qualifies, either by experiencing 20% poverty or more, or with a median family income of 80% or less in the area. Projects that are not located in these census tracts can also qualify by one of the following methods: 50% of customers are low-income, 40% of employees are low-income or 50% of owners are low-income.
NMTCs are excluded from financing residential rental housing if more than 80% of the gross income is generated from the residential portion of the development. Ineligible activities include: golf courses and country clubs, gambling facilities, liquor stores, some farming businesses, massage parlors, tanning salons and spas.
NMTC Model, Alaska Adopts Legislation to Promote the Use of NMTCs
mcatsi@aidea.org (907) 771-3060 Back to top
New Markets Jobs Act
H.B. 1832
Arkansas Code §15-4-36
A CDE must submit an application and requisite fees to the Arkansas Economic Development Commission seeking certification of the proposed equity investment or long-term debt security as a QEI. Within 30 days after receipt of a completed application, the Commission will grant or deny the application in full or in part. If any part of the application is denied, the Commission will inform the applicant of the grounds for denial. If the application is denied as incomplete, and the applicant provides the additional information or documentation required, or otherwise completes its application within 15 days of the notice of denial, the application shall be considered completed as of the original date of submission. If the applicant fails to do so, the application will be denied and must be resubmitted in full with a new submission date.
$166 Million in QEI Transaction CAP Limits
58% of the QEI
Year 0-1: 0% Year 2-4: 12% Year 5-6: 11%
bstory@arkansasedc.com
(275)-26727
California (Proposed)
A.B. 1399
39% of qualified investments
Florida Statutes §288.991-288.9922
Needs to be a CDE for federal purposes and needs to be authorized to serve businesses in Florida. Need to submit an application to the office to approve a proposed investment as a QEI. The CDE must issue the QEI in exchange for cash within 60 days after it receives the order approving an investment as a QEI, otherwise the order is void.
$10 Million in QEI
Years 1-2: 0%, Year 3: 7%, and Years 4-7: 8%.
Derives at least 50% of its total gross income from the active conduct of business within any low-income community for any taxable year.
Uses at least 40% of its tangible property, whether owned or leased, within any low income community for any taxable year. Performs at least 40% of its services through its employees in a low-income community fo any taxable year. Attributes less than 5% of the average of the aggregate unadjusted bases of the property of the entity to collectibles or nonqualified financial property.
Will create or retain jobs that pay an average wage of at least 115% of the federal poverty income guidelines for a family of four.
The following events cause recapture:
All the same events that cause a recapture at the federal level The federal new market tax credits get recaptured;
The CDE fails to provide the office with information, reports or documentation required by the New Markets Development Program Act
The office determines that a taxpayer received tax credits to which the taxpayer was not entitled The CDE fails to maintain 85% of the QLICIs in Florida The CDE fails to invest at least 85 % of the purchase price in QLICIs within 12 months after the issuance of a qualified investment
The CDE fails to maintain 85% of the purchase price in QLICIs until the last credit allowance date for a QEI
Novogradac Conact
Brook Pace
E-Mail (850) 717-8519
20 Illinois Compiled Statutes 663
Needs to be a CDE for federal purposes that has entered into an allocation agreement with the CDFI Fund pursuant to which Illinois is included in the CDE's service area. Need to submit an application to the IL Department of Commerce and Economic Opportunity (DCEO) to approve a proposed investment as a QEI. Must issue QEI within 30 days of DCEO approval, and must provide evidence of DCEO of receipt of cash investment within 10 days of QEI issuance.
$10 Million in credit
39% of the QEI
Howthe Credit is Claimed
Years 1-2: 0%, Year 3: 7%, and Years 4-7: 8%
The following events cause recapture: •	The federal new market tax credits get recaptured •	The CDE redeems or makes a principal payment with respect to a QEI prior to the 7th anniversary of a QEI (recapture amount proportionate to the amount of redemption or repayment)
•	The CDE fails to invest 85% of a QEI within 12 months and maintain such level of investment until the last credit allowance date for such QEI (recapture amount equal to all credits claimed) Other
QEI into CDE can be an equity investment or a long-term debt security instrument (minimum 7 year term, no acceleration, amortization, or prepayment features, but no limitation on acceleration for default on covenants designed to ensure compliance with IL NMTC Act or Section 45D). Insurance companies that are subject to the insurance premium tax and claims the credit against the insurance premium tax is not require to pay any additional retaliatory tax imposed pursuant to the Illinois Insurance Code. Any business that derives or expects to derive 15% or more of its annual revenue from the rental or sale of real estate is not considered a QALICB, except this restriction does not apply to a business that is controlled by or under common control with another business if the second business (i) does not derive or expects to derive 15% or more of its annual revenue from the rental or sale of real estate, and (ii) is the primary tenant of the real estate leased from the initial business. Can be used irrespective of use of Federal NMTCs in same transaction. Credit is not refundable or saleable on the open market; may be allocated through pass-through entities. Five year carry forward permitted if credit cannot be used in a taxable year.
NMTC Program Guidelines
anthony.cefali@illinois.gov
312.814.3958
H.B. 445
Kentucky Statutes §141.434
Needs to be a CDE for federal purposes with a service area including the Commonwealth of Kentucky. Needs to have entered into an allocation agreement with the CDFI Fund. An application also needs to be submitted to the state.
Any business that derives or expects to derive 15% or more of its annual revenue from the rental or sale of real estate is not considered a QALICB, except this restriction does not apply to a business that is controlled by or under common control with another business if the second business does not derive or expects to derive 15% or more of its annual revenue from the rental or sale of real estate, and is the primary tenant of the real estate leased from the initial business. Other
Any business that derives or expects to derive 15% or more of its annual revenue from the rental or sale of real estate is not considered a QALICB, except this restriction does not apply to a business that is controlled by or under common control with another business if the second business does not derive or expects to derive 15% or more of its annual revenue from the rental or sale of real estate, and is the primary tenant of the real estate leased from the initial business. Related Documents
Application for Certification of Qualified Equity Investments, Notice of Kentucky New Markets Development Program Tax Credit and Certification, Regulations
H.B. 726
Louisiana Code §1911, Louisiana Code §1912
Must be a CDE for federal purposes and an application must be submitted to the state, along with $500,000 refundable deposit.
$55 million in authority
$10 million cap on QEIs to any single QALICB
45% of the QEI Credits are applied towards premium tax liability not income tax liability.
Years 1-2: 14%, Year 3-4: 8.5%, Year 5-7: 0%
The following events cause recapture: •	The federal new market tax credits get recaptured •	The same events that cause recapture at a federal level Other
The credits can be carried forward 10 years and can be transferred. Related Documents
FAQs, FAQs 2, Fiscal Note, Application, Revenue Information Bulletin
(225) 219-2780
New Markets Capital Investment Tax Credit Program
S.P. 311
L.D. 1043; H.P 1293
Maine Revised Statutes 10 §1100-Z
Needs to be a CDE for federal purposes and an application needs to be submitted to the state.
$40 Million in QEI Credit Description
Years 1-2: 0%, Year 3: 7% Year 4-7: 8%
If any federal credits are recaptured, all of the state credits may be recaptured.
Certification Application, Program Rule
FAME General Counsel Christopher Roney (207) 620-3520 croney@famemaine.com
Equity Investment Tax Credit Program
H.B. 1727
H.B. 1662
Mississippi Code §57-105-1
$15 Million in Credits
24% of the QEI
Years 1-3: 8%
•	All the same events that cause a recapture at the federal level •	The federal new market tax credits get recaptured. Other
The credit can be carried forward 7 years.
Related Documents Application for Certification of Economic Incentives, Equity Investment Tax Credit Summary, Guidelines, Tax Incentives for Economic Development, Tax Incentives, Exemptions, and Credits, Tax Structure
Financial Resources Division (601) 359-3552
New Markets Job Growth Investment Tax Credit Program
L.B. 1128; L.B. 1022
Ameding Legislation
Nebraska Revenue Statutes §77-1101 to 77-1119
Needs to be a CDE for federal purposes.
$15 Million in QEI
Years 1-2: 0% Years 3: 7% Years 4-7: 8%
Use at least 85% of the proceeds from QEI to make QLICIs in a QALICB in Nebraska.
•	The issuer redeems or makes principal repayments with respect to a QEI prior to the seventh anniversary •	The federal new market tax credits get recaptured
•	The CDE fails to invest in a QALICB in Nebraska Other
L.B. 1022: A qualified community development entity that seeks to have an equity investment or long-term debt security designated as a qualified equity investment and eligible for tax credits under the New Markets Job Growth Investment Act shall apply to the Tax Commissioner. There shall be no new applications for such designation filed under this section after December 31, 2022.
Application for Certification of Qualified Equity Investments Eligible for the NMTC, Notice of Qualified Equity Investment
(402) 471-5814 tom.milburn@nebraska.gov Back to top
S.B. 357 Amending Legislation
Nevada Revised Statutes §231A CDE Application Process
The CDEs that have been certified by the federal NMTC program and Nevada is in their certified area are eligible to apply for the state NMTC program. Annual State CAP Limits
$200 Million in QEI
$50 Million in QEI
Years 1-2: 0% Years 3-5: 12% Years 6-7: 11%
Same as federal Recapture
•	The issuer redeems or makes principal repayments with respect to a QEI prior to the seventh anniversary •	The federal new markets tax credits get recaptured
•	The CDE fails to invest in a QALICB in Nevada Other
CDEs Contact Information, QEI Authorization Awarded, Program Overview
Ash Mirchandani (702) 486-4492
amirchandani@business.nv.gov
North Carolina Proposed
New Markets Jobs Initiative
S.B. 522*; H.B. 680*
The CDEs that have been certified by the federal NMTC program and include North Carolina in their certified area are eligible to apply for the state NMTC program. Annual State CAP Limits
$500 Million in QEI; $208,333,333 in QEI, with $156.25 Million going to the Rural Reserve Fund and the $52,083,333 going to the Statewide Reserve Fund
$7 Million in QEI in one QALICB
•	The CDE fails to invest in a QALICB in North Carolina
•	Prior to the final credit allowance date of a QEI, the proceeds were used to make QEI in any one QALICB in excess of 25% of cash proceeds
Tax credits earned by a partnership, limited liability company, S-corporation, or other "pass-through" entity may be allocated to the partners, members, or shareholders of such entity for their direct use in accordance with the provisions of any agreement among such partners, members, or shareholders.
Ohio Revised Statutes §5725.33
Needs to be a CDE for federal purposes with a service area including any portion of the State of Ohio.
Similar to federal. Excludes businesses that derives or expects to derive 15% or more of its annual revenue from rental or sale of real property, except those principally owned by a principal user of the property which is formed solely for the purpose of renting or selling the real property back to such principal user if the principal user does not derive 15% or more of its gross annual revenue from the rental or sale of real property.
•	The same events that trigger federal recapture
•	The Ohio Director of Development determines that an investment is not a QEI or that the proceeds of an investment for which tax credit is claimed are used to make QLICIs other than in QALICBs
Tax credits can be carried forward four years. Tax credits can be transferred. The credit can only apply against state franchise taxes paid by domestic companies, as well as some taxes imposed on foreign insurance companies.
Overview, Introduction to Ohio New Markets Tax Credits, Notice of Qualified Equity Investment, Program Determination
New Markets Tax Credit Program Contact
ohionewmarkets@development.ohio.gov Back to top
Low Income Communities Jobs Initiative
Oregon Revised Statutes §315.526-315.536
Needs to be a CDE for federal purposes with a service area including any portion of the State of Oregon.
$8 Million in QEI
Years 1-2: 0% Year 3: 7% Years 4-7: 8%
7 years (same as federal) QALICB Requirements
•	The federal credits get recaptured
•	The CDE makes a principal repayment with respect to a QEI before the seven year credit period
•	The CDE fails to invest 85% of the QEI into a QLICI within 12 months of the issuance of a QEI and maintain the same level of investment in QLICIs until the end of the seven year credit period
15% of the total qualified equity investments is set aside for investments in clean energy projects. Businesses that receive more than 15% of their revenue from real estate are ineligible for the credit. QEI into CDE can be an equity investment or a long-term debt security instrument (minimum seven-year term, no acceleration, amortization, or prepayment features, but no limitation on acceleration for default on covenants designed to ensure compliance with the act or IRC Section 45D). Tax credits can be carried forward.
Determination Request Form , Overview, Notice of Qualified Equity Investment, Introductory Presentation, Projects Map, Program Document Summary
john.saris@biz.state.or.us Back to top
South Carolina New Markets Jobs Act
An application to the South Carolina Department of Revenue must include: ·	Evidence that the CDE has been certified by the CDFI Fund and that South Carolina is within its service area
·	A copy of an allocation agreement with the CDFI Fund dated after Jan. 1, 2014
·	A detailed description of the QEI planned ·	Examples of QALICBs that the applicant has invested in as part of the federal program
The application also requires a $5,000 nonrefundable application fee and proof that the CDE and subsidiaries have made at least $40 million in QLICIs as part of the federal program, with no QLICI larger than $4 million to an individual QALICB.
The South Carolina Department of Revenue will approve or deny applications in full or in part within 30 days of the date of receipt
$250 million in authority
$4 million in QLICIs to an individual QALICB
58 percent of QEI that can be applied against state premium tax liability
Years 1-2: 0 percent, Years 3-6: 12 percent ,Year 7: 10 percent
Same as federal but limited to businesses meeting the U.S. Small Business Administration size eligibility standards
85 percent of the purchase price of the QEI must be invested in QALICBs by the second credit allowance date. The South Carolina Department of Revenue allows for a six month cure period before initiating recapture
Texas Proposed
State New Markets Tax Credit Program
H.B. 2061
An application under this section must include the following:
•	Evidence of the applicant's certification as a CDE, including evidence of the service area of the entity that includes this state •	A copy of an allocation agreement executed by the applicant, or its controlling entity, and the CDFI Fund •	A certificate executed by an executive officer of the applicant attesting that the allocation agreement remains in effect and has not been revoked or canceled by the CDFI Fund
•	Description of the proposed amount and structure, and of the purchaser, of the QEI
•	Identifying information for a qualified investor that will earn premium tax credits as a result of the issuance of the QEI
•	Examples of the types of QALICB in which the applicant, its controlling entity, or affiliates of its controlling entity have invested under the federal New Markets Tax Credit Program, except that an applicant is not required to disclose the identity of a specific QALICB in which the applicant intends to invest •	A nonrefundable application fee of $5,000 to be paid to the comptroller •	A refundable performance deposit of $500,000 required by Subchapter E
•	The CDE makes a principal repayment with respect to a QEI before the 7 year credit period
•	The CDE fails to invest 85% of the QEI into a QLICI within 12 months of the issuance of a QEI and maintain the same level of investment in QLICIs until the end of the 7 year credit period
•	Prior to the final credit allowance date of a qualified equity investment, the proceeds were used to make qualified low-income equity investments in any one qualified active low-income community businesses in excess of 25% of cash proceeds
$750 Million program cap.
Utah Small Business Jobs Act
Amending Legislation 31A-3-102, 59-7-102, 631-1-263
59-9-197, 63M-1-3401 through 63M-1-3412
•	A CDE must submit an application to the Utah Governor's Office of Economic Development seeking certification of the propsedproposed qualified equity investment (QEI) or long term debt security.
•	Applicants must also submit a deposit equal 0.5% percent of the QEI with their application, which is refunded at the end of the compliance period, if the CDE does not initiate recapture during the compliance period.
•	Within 30 days of receipt of a completed application, the office shall grant or deny the application in full or in part. •	If the application is denied in any part, the applicant may provide additional information and documentation to correct or complete its application within 15 days of the notice of denial, the application shall be considered completed as the original date of submission. If the applicant fails to do so, the application is denied, and the applicant may reapply with a full application and a new submission date
58 percent of the QEI
Year 0-2: 0 percent, Year 3-5: 12 percent, Year 6-7: 11 percent Credit Period (Compliance)
Same as federal, with additional requirement that business must meet size eligibility established by the United States Small Business Administration as defined in 13 C.F.R. Sec.121.101-201
Same as Federal, 6 month cure period after first notice of non-compliance
•	New capital requirement: QALICB cannot own, or have the right to acquire ownership in the CDE issuing the QEIs. Additionally the QALICB cannot loan or invest the QEI back into the CDE issuing the QEIs. •	150% percent investment requirement: A QEI is certified until the seventh credit allowance date, or when the CDE has used the proceeds from the initial QEI to invest in QALICBs such that the new QEIs exceed 150% percent of the original QEI.