2023 Laws of Puerto Rico › TITLE THIRTEEN - Taxation and Finance (§§ 1 — 33423) › Subtitle 15 - Puerto Rico Industrial Incentives Generally (§§ 10001 — 10855) › PART III - Other Tax Incentives (§§ 10401 — 10855) › Chapter 951 - Tax Credits for Investment in Housing Infrastructure (§§ 10601 — 10612) › § 10601 - Definitions

For the purposes of this chapter, the following terms and phrases shall have the meaning stated below, unless otherwise construable from the context in which they are used:
(a) Agency. — Is any department, administration, bureau, office, instrumentality, or public corporation of the Government of the Commonwealth of Puerto Rico. The term “agency” shall not include any of the municipalities of the Commonwealth of Puerto Rico.
(b) ARPE. — Are the Spanish initials for the Puerto Rico Regulations and Permits Administration, created pursuant to the provisions of §§ 71 et seq. of Title 23, as amended, known as the “Puerto Rico Regulations and Permits Administration Act”.
(c) Aqueducts and Sewers Authority. — Is the Puerto Rico Aqueducts and Sewers Authority created pursuant to the provisions of §§ 141 et seq. of Title 22, as amended, known as the “Puerto Rico Aqueducts and Sewers Authority Act”.
(d) Electric Power Authority. — Is the Puerto Rico Electric Power Authority, created pursuant to the provisions of §§ 191 et seq. of Title 22, as amended, known as the “Puerto Rico Electric Power Authority Act”.
(e) Change of control. — Is the sale, alienation, cession, fusion, exchange, permutation, or other transfer of ten percent (10%) or more of the shares, interest, or stock in the capital of the corporation, partnership or entity, to one single person or group of persons acting in common accord, whether in single or several transactions for that purpose, or which result in the tenancy or control by any person or group of persons acting in common accord, of ten percent (10%) or more of the shares, interest, or stock in the capital of said corporation, partnership or entity.
(f) Combine. — The juridical entity constituted by not less than two (2) developers to whom an agency has required as a condition prior to the endorsement of the design and construction of their respective housing developments, the financing and construction of an infrastructure of regional or municipal impact, when they sign a contract with the corresponding agency for the development and construction of an infrastructure of regional or municipal impact to be transferred to the Commonwealth of Puerto Rico or to the agency.
(g) Recommendation of approval. — Is the written concession issued pursuant to the provisions of this chapter, whereby the Secretary of Housing notifies his/her approval of an application for a credit for investment in housing infrastructure or infrastructure of regional or municipal impact and the conditions imposed thereupon. This credit for special investment in housing infrastructure or infrastructure of regional impact shall be available as provided in § 10602(d) of this title.
(h) 1994 Internal Revenue Code.— Is the 1994 Puerto Rico Internal Revenue Code, created pursuant to the provisions of Act No. 120 of October 31, 1994, as amended.
(i) Credit or Credit for special investment in housing infrastructure or credit for investment in infrastructure of regional impact. — Is the tax credit granted to the petitioner by the Secretary of Housing, upon consultation with the Secretary of the Treasury, by means of a Certificate of Approval pursuant to this chapter. The petitioner may apply this credit against any tax determined under Subtitle A of the Puerto Rico Internal Revenue Code of 1994, including the minimum alternate tax of Section 1017 and the alternate tax for individuals of Section 1014.
(j) Department of the Treasury. — Is the Department of the Treasury of the Commonwealth of Puerto Rico, created by Section VI of Article 10 of the Constitution of the Commonwealth of Puerto Rico and §§ 283 et seq. of Title 3, as amended, known as the “Puerto Rico Government Accounting Act”.
(k) Department of Natural and Environmental Resources. — Is the Puerto Rico Department of Natural and Environmental Resources created pursuant to the provisions of §§ 151 et seq. of Title 3 as amended, known as the “Natural and Environmental Resources Organic Act”.
(l) Department of Housing. — Is the Puerto Rico Department of Housing created pursuant to the provisions of §§ 441 et seq. of Title 3, as amended, known as the “Puerto Rico Department of Housing Organic Act”.
(m) Department of Transportation and Public Works. — Is the Puerto Rico Department of Transportation and Public Works, created pursuant to the provisions of §§ 291 et seq. of Title 7, as amended, and App. III of Title 3.
(n) Department of Labor. — Is the Puerto Rico Department of Labor and Human Resources created pursuant to the provisions of §§ 304 et seq. of Title 3, as amended, known as the “Puerto Rico Department of Labor Organic Act”.
(o) Developer. — Is any person who is engaged in the construction business as an entrepreneur or principal responsible for the promotion, design, sale, and construction of urbanization works and low-cost housing projects, middle class housing, and regular housing or the construction on a grand scale of individual or multi-story housing.
(p) Exaction by impact. — Is any charge or fee imposed by the agencies or municipalities concerned, on every new development project that has an impact on the endowment use of infrastructure under public domain, within or outside of the limits of the project. The tax credits for investment in housing infrastructure can be used against the exaction charges by impact, as provided in this chapter.
(q) Middle class family or person. — Is every family or person that does not have their own dwelling and whose annual income exceeds the limit established for low or moderate income families by the low-cost housing programs of the Government of the Commonwealth of Puerto Rico or the Government of the United States of America, and does not exceed thirty five percent (35%) of the maximum amount insurable by the Federal Housing Administration (FHA) for the area.
(r) Low or moderate income family or person. — Is any family or person that does not own their dwelling and whose annual income does not exceed what is established for low or moderate income families by the low-cost housing programs of the Government of the Commonwealth of Puerto Rico, or the Government of the United States of America.
(s) State Insurance Fund. — Is the State Insurance Fund Corporation, created pursuant to the provisions of §§ 1b et seq. of Title 11, as amended.
(t) Infrastructure. — Consists of those capital works, improvements, and substantial public interest facilities, constructed in conjunction with the construction of a housing project, such as aqueduct and sewer systems, including all the systems to supply, treat and distribute water, treatment and elimination of sewerage [sic], sanitary sewers or potable water mains, pumping stations, treatment plants, tanks or other facilities for serving potable water or treatment of sewerage [sic], systems for the elimination of solid or toxic waste, systems for the recovery of resources, electric power systems, including distribution lines or electric power connections, substations, and any other works or improvements to provide electric power service, highways, accesses, and intersections for vehicles, pedestrian walkways, parking facilities, bridges, tunnels, transportation systems including mass transportation, communication systems, including telephones, and rainwater systems or works for its control, including lakes, canals, and other works to manage rainwater, cable television and other similar facilities that are approved by the Secretary of Housing, and that will be used within a term of three (3) years, counting from the date that over seventy-five percent (75%) of the construction to serve the housing projects is completed. The Secretary of Housing, in consultation with the Secretary of the Treasury, shall determine by regulations how said term shall be computed and under what circumstances it can be extended. By petition of the Secretary of Housing, the title deed of every infrastructure work shall be transferred free of liens by the petitioner, to the Commonwealth of Puerto Rico.
(u) Infrastructure of regional and municipal impact. — Consists of those capital works, improvements, and substantial public interest facilities that the Secretary of Housing approves and which are previously required by an agency to various developers or to a combine as a condition for the endorsement of housing developments of each, provided that:
(1) Said infrastructure provides a capacity exceeding the needs of each of the housing developments of the combine members for at least seventy percent (70%), as certified by the agency concerned;
(2) in the judgment of the Secretary of Housing and the director of the agency, the construction of the infrastructure entails a special investment of a substantial amount which shall be taken into consideration, bearing in mind the number of residents to benefit directly or indirectly, and
(3) in the judgment of the Secretary of Housing, it significantly promotes the development of housing in a specific geographical area, municipality or region of the Island.
(v) Majority proprietary interest. — Is any person that possesses or has control, or who has come to an agreement to directly or indirectly hold or control at least ten percent (10%) of any type of shares of a corporation, the capital stock of a partnership, or shares in an entity. The special rules of Section 1028 of the Internal Revenue Code of 1994 shall apply for the determination of the shares or stock in the capital of a partnership.
(w) Investment. — Is the amount of money furnished by a developer and/or a combine or the developers who constitute the same, for an infrastructure project for a housing development or for an infrastructure project of regional or municipal impact, which may arise from financing, or contribution of the petitioner’s own funds, or from any other source that the Department of Housing considers acceptable and in accord with the public policy established by this chapter.
(x) Planning Board. — Is the Puerto Rico Planning Board created pursuant to the provisions of §§ 62 et seq. of Title 23, as amended, known as the “Puerto Rico Planning Board Organic Act”.
(y) Person. — Is any enterprise, corporation, partnership, business partnership, special partnership, individual, or group of individuals; a trust, an estate, and any other natural or juridical person.
(z) Petitioner. — Is the developer of a housing development or a combine that has presented an application for a credit for special investment in housing infrastructure or a credit for investment in infrastructure of regional or municipal impact under this chapter.
(aa) Housing development. — Is an urban development plan for housing submitted by a developer, for which he/she has obtained the corresponding endorsements, approvals, and permits from the agencies concerned.
(bb) Secretary of the Treasury. — Is the Secretary of the Department of the Treasury, or the official [to] whom he delegates his powers and authority under the Department of the Treasury Organic Act.
(cc) Secretary of Housing. — Is the Secretary of the Puerto Rico Department of Housing or the official [to] whom he delegates his powers and authority under the Department of Housing Organic Act.
(dd) Middle class housing. — Is any housing unit whose total selling price exceeds the maximum price for low-cost housing, as it varies from time to time, but does not exceed eighty percent (80%) of the maximum insurable by the Federal Housing Administration (FHA) for the area.
(ee) Low-cost housing. — Is any dwelling whose price does not exceed the maximum established by §§ 891 et seq. of Title 17, as amended, known as the “Public and Private Sector Co-partnership for the New Housing Operation Act”.
(ff) Ordinary housing. — Is the type of housing that is not comprised within the definition of low cost housing and middle class housing.
For the purposes of this chapter, any term or phrase defined in [the] singular shall also include its use in the plural.
History —Aug. 10, 2001, No. 98, § 3; Aug. 6, 2008, No. 171, § 1.