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A BILL TO BE ENTITLED
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AN ACT
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relating to certain investments by insurance companies and related |
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organizations. |
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BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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SECTION 1. Article 4.51, Insurance Code, is amended by |
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adding Subdivisions (16), (17), and (18) to read as follows: |
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(16) "Low-income community" has the meaning assigned |
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by Section 45D(e), Internal Revenue Code of 1986. |
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(17) "Program One" means the program for allocation |
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and investment of certified capital under this chapter before |
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January 1, 2007. |
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(18) "Program Two" means the program for allocation |
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and investment of certified capital under this chapter on or after |
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January 1, 2007. |
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SECTION 2. Article 4.52, Insurance Code, is amended to read |
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as follows: |
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Art. 4.52. DUTIES OF COMPTROLLER; RULES; IMPLEMENTATION. |
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The comptroller shall administer this subchapter and shall adopt |
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rules and forms as necessary to implement this subchapter. The |
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rules must provide that[:
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[(1) the comptroller shall begin accepting
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applications for certification as a certified capital company not
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later than the 30th day after the date the rules are adopted; and
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[(2)] the comptroller shall accept premium tax credit |
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allocation claims on behalf of certified investors with respect to |
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Program Two [on a date] not later than January 1, 2008 [the 120th
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day after the date the rules are adopted]. |
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SECTION 3. Article 4.56(b), Insurance Code, is amended to |
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read as follows: |
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(b) At least 50 percent of the amount of qualified |
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investments required by Subsection (a)(2) of this article must be |
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placed in early stage businesses. At least 30 percent of the amount |
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of qualified investments required by Subsections (a)(1) and (2) of |
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this article must be placed in a strategic investment or low-income |
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community business. |
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SECTION 4. Article 4.57, Insurance Code, is amended to read |
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as follows: |
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Art. 4.57. EVALUATION OF BUSINESS BY COMPTROLLER. (a) A |
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certified capital company may, before making an investment in a |
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business, request from the comptroller a written opinion as to |
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whether the business in which it proposes to invest is a qualified |
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business, an early stage business, or a strategic investment or |
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low-income community business. |
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(b) The comptroller shall, not later than the 15th business |
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day after the date of the receipt of a request under Subsection (a) |
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of this article, determine whether the business meets the |
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definition of a qualified business, an early stage business, or a |
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strategic investment or low-income community business, as |
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applicable, and notify the certified capital company of the |
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determination and an explanation of its determination or notify the |
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certified capital company that an additional 15 days will be needed |
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to review and make the determination. |
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(c) If the comptroller fails to notify the certified capital |
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company with respect to the proposed investment within the period |
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specified by Subsection (b) of this article, the business in which |
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the company proposes to invest is considered to be a qualified |
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business, early stage business, or a strategic investment or |
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low-income community business, as appropriate. |
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SECTION 5. Article 4.65, Insurance Code, is amended by |
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amending Subsection (a) and adding Subsections (a-1) and (a-2) to |
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read as follows: |
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(a) A certified investor who makes an investment of |
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certified capital shall in the year of investment earn a vested |
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credit against state premium tax liability equal to 100 percent of |
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the certified investor's investment of certified capital, subject |
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to the limits imposed by this subchapter. |
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(a-1) With respect to credits earned as a result of |
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investments made under Program One, beginning [Beginning] with the |
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tax report due March 1, 2009, for the 2008 tax year, a certified |
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investor may take up to 25 percent of the vested premium tax credit |
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in any taxable year of the certified investor. The credit may not |
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be applied to estimated payments due in 2008. |
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(a-2) With respect to credits earned as a result of |
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investments made under Program Two, beginning with the tax report |
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due March 1, 2013, for the 2012 tax year, a certified investor may |
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take up to 25 percent of the vested premium tax credit in any |
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taxable year of the certified investor. The credit may not be |
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applied to estimated payments due in 2012. |
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SECTION 6. Article 4.66(a), Insurance Code, is amended to |
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read as follows: |
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(a) A premium tax credit allocation claim must be prepared |
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and executed by a certified investor on a form provided by the |
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comptroller. The certified capital company must file the claim |
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with the comptroller on the date on which the comptroller accepts |
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premium tax credit allocation claims on behalf of certified |
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investors with respect to Program One or Program Two, as |
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applicable, under rules adopted under Article 4.52 [4.52(2)] of |
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this code. The premium tax credit allocation claim form must |
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include an affidavit of the certified investor under which the |
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certified investor becomes legally bound and irrevocably committed |
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to make an investment of certified capital in a certified capital |
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company in the amount allocated even if the amount allocated is less |
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than the amount of the claim, subject only to the receipt of an |
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allocation under Article 4.68 of this code. |
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SECTION 7. Article 4.67, Insurance Code, is amended to read |
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as follows: |
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Art. 4.67. TOTAL LIMIT ON CREDITS. (a) The total amount of |
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certified capital for which premium tax credits may be allowed |
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under this subchapter for all years in which premium tax credits are |
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allowed is: |
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(1) $200 million for Program One; and |
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(2) $200 million for Program Two. |
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(b) The total amount of certified capital for which premium |
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tax credits may be allowed for all certified investors under this |
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subchapter may not exceed the amount that would entitle all |
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certified investors in certified capital companies to take total |
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credits of $50 million in a year with respect to Program One and $50 |
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million in a year with respect to Program Two. |
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(c) A certified capital company and its affiliates may not |
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file premium tax credit allocation claims with respect to Program |
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One or Program Two, as applicable, in excess of the maximum amount |
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of certified capital for which premium tax credits may be allowed |
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for that program as provided in this article. |
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SECTION 8. Articles 4.68(a), (b), (c), and (e), Insurance |
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Code, are amended to read as follows: |
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(a) If the total premium tax credits claimed by all |
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certified investors with respect to Program One or Program Two, as |
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applicable, exceeds the total limits on premium tax credits |
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established for that program by Article 4.67(a) of this code, the |
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comptroller shall allocate the total amount of premium tax credits |
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allowed under this subchapter to certified investors in certified |
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capital companies on a pro rata basis in accordance with this |
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article. |
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(b) The pro rata allocation for each certified investor |
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shall be the product of: |
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(1) a fraction, the numerator of which is the amount of |
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the premium tax credit allocation claim filed on behalf of the |
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investor with respect to Program One or Program Two, as applicable, |
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and the denominator of which is the total amount of all premium tax |
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credit allocation claims filed on behalf of all certified investors |
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with respect to that program; and |
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(2) the total amount of certified capital for which |
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premium tax credits may be allowed with respect to that program |
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under this subchapter. |
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(c) Not later than the 15th day after the date on which the |
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comptroller accepts premium tax credit allocation claims on behalf |
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of certified investors under rules adopted under Article 4.52 |
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[4.52(2)] of this code, the comptroller shall notify each certified |
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capital company of the amount of tax credits allocated to each |
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certified investor. Each certified capital company shall notify |
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each certified investor of their premium tax credit allocation. |
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(e) The maximum amount of certified capital for which |
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premium tax credit allocation may be allowed on behalf of any one |
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certified investor and its affiliates with respect to Program One |
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or Program Two, as applicable, whether by one or more certified |
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capital companies, may not exceed the greater of: |
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(1) $10 million; or |
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(2) 15 percent of the maximum aggregate amount |
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available with respect to that program under Article 4.67(a) of |
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this code. |
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SECTION 9. This Act takes effect September 1, 2007. |