91st General Assembly
Summary of SB0011
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Short description: 
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

           Location: Senate

 Amendments to Bill: AMENDMENTS ADOPTED: HOUSE -   1     SENATE -   4


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