CERTIFIED CAPITAL COMPANY ACT
Synopsis of Bill as introduced:
Creates the Certified Capital Company Act to provide assistance
in the formation of new and expansion of existing businesses that
create jobs in the State by providing an incentive, in the form of tax
credits against the State's privilege taxes, for insurance companies
to invest in certified capital companies. Provides that the
Department of Commerce and Community Affairs shall implement the
provisions of the Act. Provides that an insurance company that
qualifies as a certified investor shall earn a vested credit against
State privilege taxes equal to 100% of the investor's investment of
certified capital, of which 10% may be taken in any taxable year.
Provides that the aggregate amount of certified capital for which
privilege tax credits shall be allowed for all certified investors
shall not exceed the amount that would entitle all certified investors
to take aggregate credits of $30,000,000 per year. Amends the
Illinois Insurance Code to provide that the amount of the credit
earned under the Certified Capital Company Act may be deducted from a
company's privilege tax liability. Effective immediately.
FISCAL NOTE (Department of Insurance)
There will be no fiscal impact on the Department; fiscal impact
on GRF could be as much as $30 million per year.
SENATE AMENDMENT NO. 1.
Deletes everything and reinstates the provisions of the Certified
Capital Company Act. Provides that a certified investor or holder of
a transferred credit claiming a credit against State privilege tax
liability shall provide the Department of Insurance certain
information. Provides that the Department of Insurance shall adopt
rules to collect the privilege tax credit. Provides that a certified
investor may not be required to reduce the provision for the tax
included in ratemaking due to a reduction in privilege tax derived
from the credit. Deletes the time limit for the Department to
determine whether a business meets the definition of a qualified
business for investment purposes. Deletes the provision exempting a
certified capital company from regulation after investing 100% of its
certified capital in qualified investments. Establishes reporting
requirements of financial information to the General Assembly. Makes
other changes. Effective immediately.
SENATE AMENDMENT NO. 2.
Provides that the privilege tax credits may be carried forward
until used or until the tax filings for calendar year 2010 (now 2020),
whichever is sooner.
SENATE AMENDMENT NO. 3.
Includes within the Act's provisions for an affiliate of a
certified capital company or insurance company a person that owns,
whether through rights, options, convertible interests, or otherwise,
or has the power to vote 25% (now 10%) or more of the outstanding
voting securities. Provides that a qualified distribution or payment
for reasonable costs and expenses may not be made directly or
indirectly to a certified investor. Adds to requirements of a
qualified debt instrument that the instrument must have an annualized
internal rate of return (calculated using the purchase price of the
qualified debt instrument, all payments of principal and interest, and
all future tax credits projected to be received) not to exceed 3.5%
over the then current yield of the most recently issued 10-year U.S.
Treasury security. Makes other changes.
SENATE AMENDMENT NO. 4.
Deletes everything and reinserts the provisions of the bill as
amended. Provides that the privilege tax credits may be carried
forward until used or until the tax filings for calendar year 2015
(now 2010), whichever is sooner. Provides that certain distributions
to equity holders of a certified capital company are subject to audit
by a nationally recognized certified public accounting firm at the
expense of the company. Provides that 30% of certain distributions in
excess of the amount required to produce a 15% return shall be paid
annually to the State Pension Fund.
HOUSE AMENDMENT NO. 1.
Deletes reference to:
215 ILCS 5/409
Deletes everything. Creates the Certified Capital Company Act
with the short title as the only provision.
Last action on Bill: SESSION SINE DIE
Last action date: 01-01-09
Amendments to Bill: AMENDMENTS ADOPTED: HOUSE - 1 SENATE - 4
END OF INQUIRY
Full Text Bill Status