ENROLLED
Senate Bill No. 513
(By Senators McCabe, Plymale, Jenkins, Foster,
Sprouse, Harrison, Sharpe, Dempsey, Barnes and Unger)
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[Passed April 16, 2005; in effect from passage.]
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AN ACT to amend and reenact §5E-1-8 of the Code of West Virginia,
1931, as amended, relating to the Capital Company Act;
eliminating the total tax credits available under the Capital
Company Act during the fiscal year beginning on the first day
of July, two thousand five; and modifying the time period in
which the authority may allocate tax credits available under
the Capital Company Act during the fiscal year beginning on
the first day of July, two thousand four.
Be it enacted by the Legislature of West Virginia:
That §5E-1-8 of the Code of West Virginia, 1931, as amended,
be amended and reenacted to read as follows:
ARTICLE 1. WEST VIRGINIA CAPITAL COMPANY ACT.
§5E-1-8. Tax credits.
(a) The total amount of tax credits authorized for a single
qualified company may not exceed two million dollars. The total
amount of tax credits authorized for a single economic development
and technology advancement center may not exceed one million
dollars. Capitalization of the company or center may be increased pursuant to rule of the authority.
(b)(1) The total credits authorized by the authority for all
companies and centers may not exceed a total of ten million dollars
each fiscal year:
Provided, That for the fiscal year beginning on
the first day of July, one thousand nine hundred ninety-nine, the
total credits authorized for all companies may not exceed a total
of six million dollars:
Provided, however, That for the fiscal
year beginning on the first day of July, two thousand, the total
credits authorized for all companies may not exceed a total of four
million dollars:
Provided further, That for the fiscal year
beginning on the first day of July, two thousand one, the total
credits authorized for all companies may not exceed a total of four
million dollars:
And provided further, That for the fiscal year
beginning on the first day of July, two thousand two, the total
credits authorized for all companies may not exceed a total of
three million dollars:
And provided further, That for the fiscal
year beginning on the first day of July, two thousand three, the
total credits authorized for all companies may not exceed a total
of three million dollars:
And provided further, That for the
fiscal year beginning on the first day of July, two thousand four,
the total credits authorized for all companies may not exceed a
total of one million dollars:
And provided further, That for the
fiscal year beginning on the first day of July, two thousand five,
there shall be no credits authorized:
And provided further, That
the capital base of any qualified company other than an economic
development and technology advancement center qualified under the
provisions of article twelve-a, chapter eighteen-b of this code shall be invested in accordance with the provisions of this
article. The authority shall allocate these credits to qualified
companies and centers in the order that the companies are
qualified.
(2) Not more than two million dollars of the credits allowed
under subdivision (1) of this subsection may be allocated by the
authority during each fiscal year to one or more small business
investment companies described in this subdivision:
Provided, That
for the fiscal year beginning on the first day of July, two
thousand four, and for the fiscal year beginning on th first day of
July, two thousand five, no credits authorized by this section may
be allocated by the authority to one or more small business
investment companies. After a portion of the credits are allocated
to small business investment companies as provided in this section,
not more than one million dollars of the credits allowed under
subdivision (1) of this subsection may be allocated by the
authority during each fiscal year to one or more economic
development and technology advancement centers qualified by the
authority under article twelve-a, chapter eighteen-b of this code:
Provided, however, That for the fiscal year beginning on the first
day of July, two thousand four, all of the credits allowed under
subdivision (1) of this subsection shall be allocated only to one
or more qualified economic development and technology advancement
centers:
Provided further, That for the fiscal year beginning on
the first day of July, two thousand five, no credits allowed under
subdivision (1) of this subsection shall be allocated to any
qualified economic development and technology advancement center. The remainder of the tax credits allowed during the fiscal year
shall be allocated by the authority under the provisions of section
four, article two of this chapter:
And provided further, That for
the fiscal year beginning on the first day of July, two thousand
four, and for the fiscal year beginning on the first day of July,
two thousand five, no credits authorized by this section may be
allocated by the authority to a taxpayer pursuant to the provisions
of section four, article two of this chapter. The portion of the
tax credits allowed for small business investment companies
described in this subdivision shall be allowed only if allocated by
the authority during the first ninety days of the fiscal year and
may only be allocated to companies that: (A) Were organized on or
after the first day of January, one thousand nine hundred ninety-
nine; (B) are licensed by the small business administration as a
small business investment company under the small business
investment act; and (C) have certified in writing to the authority
on the application for credits under this act that the company will
diligently seek to obtain and thereafter diligently seek to invest
leverage available to the small business investment companies under
the small business investment act. These credits shall be
allocated by the authority in the order that the companies are
qualified. The portion of the tax credits allowed for economic
development and technology advancement centers described in article
twelve-a, chapter eighteen-b of this code shall be similarly
allowed only if allocated by the authority during the first ninety
days of the fiscal year:
And provided further, That solely for the
fiscal year beginning on the first day of July, two thousand four, the authority may allocate the tax credits allowed for economic
development and technology advancement centers at any time during
the fiscal year
. Any credits which have not been allocated to
qualified companies meeting the requirements of this subdivision
relating to small business investment companies or to qualified
economic development and technology advancement centers during the
first ninety days of the fiscal year shall be made available and
allocated by the authority under the provisions of section four,
article two of this chapter: And provided further, That for the
fiscal year beginning on the first day of July, two thousand four,
and for the fiscal year beginning on the first day of July, two
thousand five, no credits authorized by this section may be
allocated by the authority to a taxpayer pursuant to the provisions
of section four, article two of this chapter.
(3) Notwithstanding any provision of this code or legislative
rule promulgated thereunder to the contrary, for the fiscal year
beginning on the first day of July, two thousand four, and for the
fiscal year beginning on the first day of July, two thousand five,
the authority has the sole discretion to allocate or refuse to
allocate tax credits authorized under this section to any qualified
economic development and technology advancement center upon its
determination of the extent to which the center will fulfill the
purposes of this article. The determination shall be based upon
the application of the center, the extent to which the company or
center fulfilled those purposes in prior years after receiving tax
credits authorized under this section, the extent to which the
center is expected to stimulate economic development and high technology research in the chemical industry and such other
similarly related criteria as the authority may establish by vote
of the majority of authority.
(c) Any investor, including an individual, partnership,
limited liability company, corporation or other entity who makes a
capital investment in a qualified West Virginia capital company, is
entitled to a tax credit equal to fifty percent of the investment,
except as otherwise provided in this section or in this article:
Provided, That the tax credit available to investors who make a
capital investment in an economic development and technology
advancement center shall be one hundred percent of the investment.
The credit allowed by this article shall be taken after all other
credits allowed by chapter eleven of this code. It shall be taken
against the same taxes and in the same order as set forth in
subsections (c) through (i), inclusive, section five, article
thirteen-c, chapter eleven of this code. The credit for
investments by a partnership, limited liability company, a
corporation electing to be treated as a subchapter S corporation or
any other entity which is treated as a pass through entity under
federal and state income tax laws may be divided pursuant to
election of the entity's partners, members, shareholders or owners.
(d) The tax credit allowed under this section is to be
credited against the taxpayer's tax liability for the taxable year
in which the investment in a qualified West Virginia capital
company or economic development and technology advancement center
is made. If the amount of the tax credit exceeds the taxpayer's
tax liability for the taxable year, the amount of the credit which exceeds the tax liability for the taxable year may be carried to
succeeding taxable years until used in full or until forfeited:
Provided, That: (i) Tax credits may not be carried forward beyond
fifteen years; and (ii) tax credits may not be carried back to
prior taxable years. Any tax credit remaining after the fifteenth
taxable year is forfeited.
(e) The tax credit provided in this section is available only
to those taxpayers whose investment in a qualified West Virginia
capital company or economic development and technology advancement
center occurs after the first day of July, one thousand nine
hundred eighty-six.
(f) The tax credit allowed under this section may not be used
against any liability the taxpayer may have for interest, penalties
or additions to tax.
(g) Notwithstanding any provision in this code to the
contrary, the tax commissioner shall publish in the state register
the name and address of every taxpayer and the amount, by category,
of any credit asserted under this article. The categories by
dollar amount of credit received are as follows:
(1) More than $1.00, but not more than $50,000;
(2) More than $50,000, but not more than $100,000;
(3) More than $100,000, but not more than $250,000;
(4) More than $250,000, but not more than $500,000;
(5) More than $500,000, but not more than $1,000,000; and
(6) More than $1,000,000.