Senate Bill No. 345
(By Senator Tomblin, Mr. President)
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[Introduced March 14, 1997; referred to the Committee
on Small Business.]
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A BILL to amend and reenact section three, article thirteen-j,
chapter eleven of the code of West Virginia, one thousand
nine hundred thirty-one, as amended, relating to the
neighborhood investment program act; and including county-
and municipal-owned organizations within the definition of
"neighborhood organization".
Be it enacted by the Legislature of West Virginia:
That section three, article thirteen-j, chapter eleven of
the code of West Virginia, one thousand nine hundred thirty-one,
as amended, be amended and reenacted to read as follows:
ARTICLE 13J. NEIGHBORHOOD INVESTMENT PROGRAM.
§11-13J-3. Definitions.
(a) General. -- When used in this article, or in the
administration of this article, terms defined in subsection (b) of this section shall have the meanings ascribed to them by this
section, unless a different meaning is clearly required by either
the context in which the term is used, or by specific definition
in this article.
(b) Terms defined.
(1) Affiliate. -- The terms "affiliate" or "affiliates"
include all concerns which are affiliates of each other when
either directly or indirectly:
(A) One concern controls or has the power to control the
other; or
(B) A third party or third parties control or have the power
to control both. In determining whether concerns are
independently owned and operated and whether or not affiliation
exists, consideration shall be given to all appropriate factors,
including common ownership, common management and contractual
relationships.
(2) Capacity building. -- The term "capacity building" means
to generally enhance the capacity of the community to achieve
improvements and to obtain the community services described in
items (i) through (v), inclusive of the definition of that term,
as set forth in subdivision (4) of this subsection. Capacity
building includes, but is not limited to, improvement of the
means, or capacity, to:
(i) Access, obtain and use private, charitable and
governmental assistance programs, administrative assistance, and
private, charitable and governmental resources or funds;
(ii) Fulfill legal, bureaucratic and administrative
requirements and qualifications for accessing assistance,
resources or funds; and
(iii) Attract and direct political and community attention
to needs of the community for the purpose of increasing access to
and use of assistance, resources or funds for a given purpose,
goal or need.
(3) Commissioner or tax commissioner. -- The terms
"commissioner" and "tax commissioner" are used interchangeably
herein and mean the tax commissioner of the state of West
Virginia, or his or her delegate.
(4) Community services. -- "Community services" means
services, provided at no charge whatsoever, of:
(i) Providing any type of health, personal finance,
psychological or behavioral, religious, legal, marital,
educational or housing counseling and advice to economically
disadvantaged citizens or a specifically designated group of
economically disadvantaged citizens, or in an economically
disadvantaged area; or
(ii) Providing emergency assistance or medical care to economically disadvantaged citizens or to a specifically
designated group of economically disadvantaged citizens, or in an
economically disadvantaged area; or
(iii) Establishing, maintaining or operating recreational
facilities, or housing facilities for economically disadvantaged
citizens or a specifically designated group of economically
disadvantaged citizens, or in an economically disadvantaged area;
or
(iv) Providing economic development assistance to
economically disadvantaged citizens or a specifically designated
group of economically disadvantaged citizens without regard to
whether they are located in an economically disadvantaged area,
or to individuals, groups or neighborhood or community
organizations, in an economically disadvantaged area; or
(v) Providing community technical assistance and capacity
building to economically disadvantaged citizens or a specifically
designated group of economically disadvantaged citizens or to
individuals, groups or neighborhood or community organizations in
an economically disadvantaged area.
(5) Compensation. -- The term "compensation" means wages,
salaries, commissions and any other form of remuneration paid to
employees for personal services.
(6) Corporation. -- The term "corporation" means any corporation, joint-stock company or association, and any business
conducted by a trustee or trustees wherein interest or ownership
is evidenced by a certificate of interest or ownership or similar
written instrument.
(7) Crime prevention. -- "Crime prevention" means any
activity which aids in the reduction of crime.
(8) Delegate. -- The term "delegate" in the phrase "or his
or her delegate", when used in reference to the tax commissioner,
means any officer or employee of the tax division of the
department of tax and revenue duly authorized by the tax
commissioner directly, or indirectly by one or more redelegations
of authority, to perform the functions mentioned or described in
this article.
(9) Director or director of the West Virginia development
office. -- The term "director" or "director of the West Virginia
development office" means the director of the West Virginia
office.
(10) Economically disadvantaged area. -- The term
"economically disadvantaged area" means:
(A) In a municipality - any area not exceeding fifteen
square miles in West Virginia which contains any portion of an
incorporated municipality and:
(i) In which area the average annual gross personal income of residents living therein is not more than one hundred twenty- five percent of the federal designated poverty level for personal
incomes; and
(ii) That is certified as an economically disadvantaged area
by the West Virginia development office.
(B) In a rural area - any area not exceeding twenty-five
square miles in West Virginia:
(i) Which area is located in a rural area and which contains
no incorporated municipalities or portions thereof;
(ii) In which area the average annual gross personal income
of residents living therein is not more than one hundred twenty- five percent of the federal designated poverty level for personal
incomes; and
(iii) That is certified as an economically disadvantaged
area by the West Virginia development office.
(C) An economically disadvantaged area shall qualify as such
only pursuant to a certification issued by the West Virginia
development office. Such certifications issued by the West
Virginia development office shall expire after the passage of
five calendar years, unless specifically limited to a shorter
time by specific order of the West Virginia development office,
and no area shall hold the status of a certified economically
disadvantaged area for a period of time greater than ten years,
either consecutively or in the aggregate.
(D) The certification of an economically disadvantaged area
shall be made on the basis of current indices of social and
economic conditions, which shall include, but not be limited to,
the median per capita income of the area in relation to the
median per capita income of the state or standard metropolitan
statistical area in which the area is located.
(E) No economically disadvantaged area may be certified
within twenty-five miles of any other certified economically
disadvantaged area. Not more than six economically disadvantaged
areas may hold the status of certified economically disadvantaged
areas at any one time in this state.
(F) At least a majority of all economically disadvantaged
areas holding designations as economically disadvantaged areas at
any one time shall be located in rural areas.
(G) Such certification shall be filed with the secretary of
state and shall specifically set forth the boundaries of the
economically disadvantaged area by both description and map, the
date of certification of the area as an economically
disadvantaged area, the date on which such certification will
terminate and a statement of the director's findings as to the
average annual gross personal income of residents living in the
certified economically disadvantaged area.
(11) Economically disadvantaged citizen. -- The term "economically disadvantaged citizen" means a natural person, who
during the current taxable year has, or during the immediately
preceding taxable year had, an annual gross personal income not
exceeding one hundred twenty-five percent of the federal
designated poverty level for personal incomes, and who is a
domiciliary and resident of this state.
(12) Education. -- "Education" means any type of scholastic
instruction to, or scholarship by, an individual that enables
such individual to prepare for better life opportunities.
Education does not include courses in physical training, physical
conditioning, physical education, sports training, sports camps
and similar training or conditioning courses (except for physical
therapy prescribed by a physician or other person licensed to
prescribe courses of medical treatment under West Virginia law).
(13) Eligible contribution. --
(A) An eligible contribution consists of cash, tangible
personal property valued at its fair market value, real property
valued at its fair market value or a contribution of in kind
professional services valued at seventy-five percent of fair
market value.
(B) For purposes of this definition, the value of in kind
professional services will not qualify as an eligible
contribution unless the services are:
(i) Reasonably priced and valued, and reasonably necessary
services customarily and normally provided by the contributor in
the normal course of business to customers, clients or patients
other than those encompassed by the project plan;
(ii) Not reimbursable, in whole or in part, from sources
other than the tax credit provided under this article; and
(iii) Are services which are not available elsewhere in the
community.
(C) The term "professional services" means only those
services provided directly by a physician licensed to practice in
this state, those services provided directly by a dentist
licensed to practice in this state, those services provided
directly by a lawyer licensed to practice in this state, those
services provided directly by a registered nurse, licensed
practical nurse, dental hygienist, or other health care
professional licensed to practice in this state and those
services provided directly by a certified public accountant or
public accountant licensed to practice in this state.
(D) Minimum contribution. -- No contribution of cash,
property or professional services or any combination thereof
contributed in any tax year by any taxpayer having a fair market
value of less than five hundred dollars qualifies as an eligible
contribution.
(E) Maximum contribution. -- No contribution of cash,
property or professional services or any combination thereof
contributed in any tax year by any taxpayer having a fair market
value in excess of two hundred thousand dollars qualifies as an
eligible contribution.
(F) Limitations. -- Not more than fifty percent of total
eligible contributions to a certified project may be in kind
contributions. Not more than twenty-five percent of total
eligible contributions made by any taxpayer to any certified
project may be in kind contributions.
(14) Eligible taxpayer. --
(A) The term "eligible taxpayer" means any person subject to
the taxes imposed by article twenty-one, twenty-three or
twenty-four of this chapter which makes an eligible contribution
to a qualified charitable organization pursuant to the terms of
a certified project plan for the purpose of providing
neighborhood assistance, community services, or crime prevention,
or for the purpose of providing job training or education for
individuals not employed by the contributing taxpayer or an
affiliate of the contributing taxpayer or a person related to the
contributing taxpayer.
(B) "Eligible taxpayer" also includes an affiliated group of
taxpayers if such group elects to file a consolidated corporation net income tax return under article twenty-four of this chapter
and if one or more affiliates included in such affiliated group
would qualify as an eligible taxpayer under part (A) of this
paragraph.
(15) Includes and including. -- The terms "includes" and
"including", when used in a definition contained in this article,
shall not be deemed to exclude other things otherwise within the
meaning of the term defined.
(16) Job training. -- "Job training" means instruction to an
individual that enables the individual to acquire vocational
skills so as to become employable or to be able to seek a higher
grade of employment.
(17) Natural person or individual. -- The term "natural
person" and the term "individual" mean a human being. The terms
"natural person" and "individual" do not mean, and specifically
exclude any corporation, limited liability company, partnership,
joint venture, trust, organization, association, agency,
governmental subdivision, syndicate, affiliate or affiliation,
group, unit or any entity other than a human being.
(18) Neighborhood assistance. -- "Neighborhood assistance"
means either:
(A) Furnishing financial assistance, labor, material and
technical advice to aid in the physical or economic improvement of any part or all of an economically disadvantaged area; or
(B) Furnishing technical advice to promote higher employment
in an economically disadvantaged area.
(19) Neighborhood organization. -- "Neighborhood
organization" means any organization (A) which is performing
community services, as defined in this section and which is
either:
(B) Which is exempt (A) Exempt from income taxation under
Sections 501(c)(3) or (4) of the Internal Revenue Code; or
(B) Is owned by a county or municipal government.
(20) West Virginia development office. -- The term "West
Virginia development office" means the West Virginia development
office.
(21) Partnership and partner. -- The term "partnership"
includes a syndicate, group, pool, joint venture or other
unincorporated organization through or by means of which any
business, financial operation or venture is carried on, and which
is not a trust or estate, a corporation or a sole proprietorship.
The term "partner" includes a member in such a syndicate, group,
pool, joint venture or organization.
(22) Person. -- The term "person" includes any natural
person, corporation, limited liability company or partnership.
(23) Project transferee. -- The term "project transferee" means any neighborhood organization, qualified charitable
organization, charitable organization or other organization,
entity or person that receives an eligible contribution or part
of an eligible contribution from an eligible taxpayer for the
purpose of directly or indirectly providing neighborhood
assistance, community services, or crime prevention, or for the
purpose of providing job training or education or other services
or assistance pursuant to a project plan. The project transferee
is typically the first entity or person receiving eligible
contributions from eligible taxpayers under a project plan.
However, in the case of eligible contributions of in-kind
services or other eligible contributions or portions thereof made
pursuant to a certified project plan directly to indigent,
disadvantaged or needy persons, economically disadvantaged
citizens, or other persons or organizations under the sponsorship
or auspices of any neighborhood organization, qualified
charitable organization, charitable organization or other
organization, entity or person as a certified project
participant, such eligible contributions shall be deemed to have
been made to the entity, organization or person under whose
sponsorship or auspices such eligible contributions are made, and
that entity, organization or person is deemed to be the project
transferee with relation to those eligible contributions. The
project transferee is the entity, organization or person that is liable under this article for payment of the project
certification fee to the West Virginia development office. The
term "project transferee" shall mean and include any deemed
project transferee, deemed as such under the provisions of this
article.
(24) Qualified charitable organization. -- The term
"qualified charitable organization" means a neighborhood
organization, as defined in this section, which is the sponsor of
a project which has received certification by the director of the
West Virginia development office pursuant to the requirements of
this article: Provided, That no organization may qualify as a
qualified organization for purposes of this article if such
organization is not registered with this state as required under
the solicitation of charitable funds act.
(25) Related person. -- The term "related person" or "person
related to" a stated taxpayer means:
(A) An individual, corporation, partnership, affiliate,
association or trust or any combination or group thereof
controlled by the taxpayer; or
(B) An individual, corporation, partnership, affiliate,
association or trust or any combination or group thereof that is
in control of the taxpayer; or
(C) An individual, corporation, partnership, affiliate, association or trust or any combination or group thereof
controlled by an individual, corporation, partnership, affiliate,
association or trust or any combination or group thereof that is
in control of the taxpayer; or
(D) A member of the same controlled group as the taxpayer.
For purposes of this article, "control", with respect to a
corporation means ownership, directly or indirectly, of stock
possessing fifty percent or more of the total combined voting
power of all classes of the stock of such corporation which
entitles its owner to vote. "Control", with respect to a trust,
means ownership, directly or indirectly, of fifty percent or more
of the beneficial interest in the principal or income of such
trust. The ownership of stock in a corporation, of a capital or
profits interest in a partnership or association or of a
beneficial interest in a trust shall be determined in accordance
with the rules for constructive ownership of stock provided in
Section 267(c), other than paragraph (3) of such section, of the
United States Internal Revenue Code, as amended.
(26) State fiscal year. -- "State fiscal year" means a
twelve-month period beginning on the first day of July and ending
on the thirtieth day of June.
(27) Taxpayer. -- The term "taxpayer" means any person
subject to the tax imposed by article twenty-one, twenty-three or twenty-four of this chapter (or any one or combination of such
articles of this chapter).
(28) Technical assistance. --
(A) The term "technical assistance" means assistance in
understanding, using and fulfilling the legal, bureaucratic and
administrative requirements and qualifications which must be
negotiated for the purpose of effectively accessing, obtaining
and using private, charitable, not-for-profit or governmental
assistance, resources or funds, and maximizing the value thereof.
(B) "Technical assistance" also means assistance provided by
any person holding a license under West Virginia law to practice
any licensed profession or occupation, whereby such person, in
the practice of such profession or occupation, assists
economically disadvantaged citizens or the persons in an
economically disadvantaged area by:
(i) Providing any type of health, personal finance,
psychological or behavioral, religious, legal, marital,
educational or housing counseling and advice to economically
disadvantaged citizens or a specifically designated group of
economically disadvantaged citizens, or in an economically
disadvantaged area; or
(ii) Providing emergency assistance or medical care to
economically disadvantaged citizens or to a specifically designated group of economically disadvantaged citizens, or in an
economically disadvantaged area; or
(iii) Establishing, maintaining or operating recreational
facilities, or housing facilities for economically disadvantaged
citizens or a specifically designated group of economically
disadvantaged citizens, or in an economically disadvantaged area;
or
(iv) Providing economic development assistance to
economically disadvantaged citizens or a specifically designated
group of economically disadvantaged citizens without regard to
whether they are located in an economically disadvantaged area,
or to individuals, groups or neighborhood or community
organizations, in an economically disadvantaged area; or
(v) Providing community technical assistance and capacity
building to economically disadvantaged citizens or a specifically
designated group of economically disadvantaged citizens or to
individuals, groups or neighborhood or community organizations in
an economically disadvantaged area.
(29) This code. -- The term "this code" means the code of
West Virginia, one thousand nine hundred thirty-one, as amended.
(30) This state. -- The term "this state" means the state of
West Virginia.
NOTE: The purpose of this bill is to include county- and
municipal-owned organizations within the definition of
"neighborhood organization" for purposes of the Neighborhood
Investment Program Act.
Strike-throughs indicate language that would be stricken
from the present law, and underscoring indicates new language
that would be added.