,,ii #aah? ,,congress #a/ ,session ,s4 #bifc ,,9 ,,! ,,s5ate ,,( ,,! ,,unit$ ,,/ates ,septemb] #bh 7legislative day1 ,septemb] #bb71 #bjbc,mr4 ,w>n] 7= himself1 ,mr4 ,wick]1 ,mr4 ,pet]s1 ,mrs4 ,hyde-,smi?1 ,mr4 ,moran1 & ,mr4 ,van ,holl57 introduc$ ! foll[+ bill2 :i* 0 read twice & ref]r$ to ! ,committee on ,f9ance ,a ,,bill ,to am5d ! ,int]nal ,rev5ue ,code ( #aihf to provide a cr$it = inve/m5t 9 ,community ,developm5t ,f9ancial ,in/itutions4 #a4 ,%ort title ,?is ,act may be cit$ z ! ,community ,developm5t ,inve/m5t ,tax ,cr$it ,act ( #bjbc4 #b4 ,community developm5t f9ancial in/itution inve/m5t tax cr$it 7a7 ,9 g5]al ,subp>t ,d ( "p ,,iv ( sub*apt] ,a ( *apt] #a ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by add+ at ! end ! foll[+ new section3 #de;,,bb4 ,community developm5t f9ancial in/itution inve/m5t tax cr$it 7a7 ,all[ance ( cr$it 7#a7 ,9 g5]al ,= purposes ( section #ch1 9 ! case ( a taxpay] :o holds a qualifi$ ,,cdfi inve/m5t on a cr$it all[ance date ( su* inve/m5t :i* occurs dur+ ! taxable ye>1 ! ,,cdfi inve/m5t cr$it det]m9$ "u ?is section = su* taxable ye> is an am\nt equal to ! applicable p]c5tage ( ! am\nt paid to ! qualifi$ community developm5t f9ancial in/itution = su* inve/m5t at its orig9al issue4 7#b7 ,applicable p]c5tage ,= purposes ( p>agraph 7#a7-- 7,a7 ,9 g5]al ,! applicable p]c5tage is-- 7i7 #c p]c5t ) respect to ! fir/ #aj cr$it all[ance dates1 & 7ii7 #d p]c5t ) respect to ! #aj cr$it all[ance dates foll[+ ! la/ cr$it all[ance date to :i* clause 7i7 applies4 7,b7 ,increas$ am\nt = c]ta9 inve/m5ts ,9 ! case ( a qualifi$ ,,cdfi inve/m5t :i* does n h a fix$ t]m or duration1 ! applicable p]c5tage = any cr$it all[ance date %all be increas$ by "o p]c5tage po9t4 7#c7 ,cr$it all[ance date 7,a7 ,9 g5]al ,= purposes ( p>agraph 7#a71 ! t]m cr$it all[ance date means1 ) respect to any qualifi$ ,,cdfi inve/m5t-- 7i7 ! date :i* is "o ye> aft] ! date on :i* su* inve/m5t is initially made1 & 7ii7 ea* ( ! #ai anniv]s>y dates ( su* date !reaft]4 7,b7 ,limitation ,not)/&+ subp>agraph 7,a71 a date %all n be treat$ z a cr$it all[ance date ) respect to any qualifi$ ,,cdfi inve/m5t if su* date occurs aft] any date on :i*-- 7i7 ! f9ancial in/itution 9 :i* su* ,,cdfi inve/m5t is made ceases to be a qualifi$ community developm5t f9ancial in/itution1 or 7ii7 su* inve/m5t is r$eem$1 repur*as$1 or o!rwise repaid by ! qualifi$ community developm5t f9ancial in/itution :i* issu$ su* inve/m5t4 7b7 ,qualifi$ ,,cdfi inve/m5t ,= purposes ( ?is section-- 7#a7 ,9 g5]al ,! t]m qualifi$ ,,cdfi inve/m5t means any inve/m5t 9 a qualifi$ community developm5t f9ancial in/itution if-- 7,a7 su* inve/m5t is acquir$ by ! taxpay] at its orig9al issue 7directly or ?r\gh an und]writ]7 solely 9 ex*ange = ca%1 7,b7 su* inve/m5t is 9 ! =m (-- 7i7 non-vot+ /ock or an equity equival5t inve/m5t1 7ii7 an int]e/ 9 an entity :i* is a p>tn]%ip1 or 7iii7 an obligation describ$ 9 section #bgi7;b77#b7 :i* has a t]m ( #aj ye>s or long]1 7,c7 su* inve/m5t has n be5 designat$ z a qualifi$ equity inve/m5t = purposes ( section #de;,d1 & 7,d7 su* inve/m5t is designat$ = purposes ( ?is section by ! qualifi$ community developm5t f9ancial in/itution4 ,su* t]m %all n include any inve/m5t issu$ by a qualifi$ community developm5t f9ancial in/itution m ?an #e ye>s aft] ! date t su* f9ancial in/itution receives an allocation "u subsection 7d77#c74 ,any allocation n us$ )9 su* #e-ye> p]iod may be reallocat$ by ! ,secret>y "u subsection 7d74 7#b7 ,limitation ,! maximum am\nt ( inve/m5ts issu$ by a qualifi$ community developm5t f9ancial in/itution :i* may be designat$ "u p>agraph 7#a77;,d7 by su* f9ancial in/itution %all n exce$ ! portion ( ! limitation am\nt allocat$ "u subsection 7d7 to su* f9ancial in/itution4 7#c7 ,treatm5t ( subsequ5t pur*as]s ,! t]m qualifi$ ,,cdfi inve/m5t includes any inve/m5t :i* w\ld 7b = p>agraph 7#a77;,a77 be a qualifi$ ,,cdfi inve/m5t 9 ! h&s ( ! taxpay] if su* inve/m5t 0 a qualifi$ ,,cdfi inve/m5t 9 ! h&s ( a prior hold]4 7#d7 ,r$emptions ,a rule simil> to ! rule ( section #abjb7;c77#c7 %all apply = purposes ( ?is subsection4 7#e7 ,equity equival5t inve/m5t ,= purposes ( ?is p>agraph1 ! t]m equity equival5t inve/m5t means an obligation ( a qualifi$ community developm5t f9ancial in/itution :i*-- 7,a7 is c>ri$ z an inve/m5t on ! inve/or's balance %eet 9 accordance ) ,g5]ally ,accept$ ,acc\nt+ ,pr9ciples1 7,b7 is n secur$ by any ( ! assets ( ! qualifi$ community developm5t f9ancial in/itution1 7,c7 is fully subord9at$ to ! "r ( repaym5t ( all ( ! o!r cr$itors ( ! qualifi$ community developm5t f9ancial in/itution1 7,d7 does n give ! inve/or ! "r to accel]ate paym5t unless ! qualifi$ community developm5t f9ancial in/itution ceases its normal op]ations1 7,e7 c>ries an int]e/ rate or divid5d t is n ti$ to any income receiv$ by ! qualifi$ community developm5t f9ancial in/itution1 & 7,f7 has an indet]m9ate maturity4 7c7 ,qualifi$ community developm5t f9ancial in/itution ,= purposes ( ?is section1 ! t]m qualifi$ community developm5t f9ancial in/itution means-- 7#a7 any community developm5t f9ancial in/itution 7z def9$ 9 section #ajc ( ! ,community ,developm5t ,bank+ & ,f9ancial ,in/itutions ,act ( #aiid 7#ab ,u4,s4,c4 #dgjb771 or 7#b7 any p>tn]%ip t is controll$1 = purposes ( section #dhb1 or any inve/m5t vehicle ! inve/m5t activities ( :i* are o!rwise sub/antially entirely manag$ & direct$1 by "o or m community developm5t f9ancial in/itutions 7z s def9$74 7d7 ,national limitation on am\nt ( inve/m5ts designat$ 7#a7 ,9 g5]al ,!re is an inve/m5t tax cr$it limitation = ea* cal5d> ye>4 ,su* a limitation is-- 7,a7 #a1jjj1jjj1jjj = #bjbc1 7,b7 #a1ejj1jjj1jjj = #bjbd1 & 7,c7 #b1jjj1jjj1jjj = ea* ye> !reaft]4 7#b7 ,inflation adju/m5t 7,a7 ,9 g5]al ,9 ! case ( any cal5d> ye> aft] #bjbe1 ! #b1jjj1jjj1jjj 9 p>agraph 7#a77;,c7 %all be increas$ by an am\nt equal to-- 7i7 su* doll> am\nt1 multipli$ by 7ii7 ! co/-(-liv+ adju/m5t det]m9$ "u section #a7;f77#c7 = ! cal5d> ye> 9 :i* ! taxable ye> beg9s1 det]m9$ by sub/itut+ cal5d> ye> #bjbd = cal5d> ye> #bjaf 9 subp>agraph 7,a77ii7 !re(4 7,b7 ,r\nd+ ,if any increase det]m9$ "u subp>agraph 7,a7 is n a multiple ( #a1jjj1jjj1 su* increase %all be r\nd$ to ! ne>e/ multiple ( #a1jjj1jjj4 7#c7 ,allocation ( limitation 7,a7 ,9 g5]al ,! limitation "u p>agraph 7#a7 %all be allocat$ by ! ,secret>y among qualifi$ community developm5t f9ancial in/itutions select$ by ! ,secret>y bas$ on ! foll[+ crit]ia3 7i7 ,f9ancial & compliance p]=mance4 7ii7 ,demon/rat$ ability to attract private capital4 7iii7 ,! div]sity ( bus9ess model types4 7iv7 ,! div]sity ( population d5sity s]v$4 7v7 ,impact g5]ation capacity4 7vi7 ,! in=mation conta9$ 9 ! inve/m5t plan describ$ 9 subp>agraph 7,b74 7vii7 ,:e!r ! inve/m5t t]m w exce$ #aj ye>s4 7viii7 ,su* o!r crit]ia z det]m9$ appropriate by ! ,secret>y4 7,b7 ,requirem5t to provide an inve/m5t plan ,an application submitt$ to ! ,secret>y "u subp>agraph 7,a7 %all include a plan t-- 7i7 describes h[ ! qualifi$ community developm5t f9ancial in/itution w exp& or ma9ta9 its l5d+ & inve/+ activity 9 its t>get m>ket z a result ( qualifi$ ,,cdfi inve/m5ts1 & 7ii7 includes su* o!r in=mation z requir$ by ! ,secret>y4 7#d7 ,c>ryov] ( unus$ limitation ,if ! new inve/m5t tax cr$it limitation = any cal5d> ye> exce$s ! aggregate am\nt allocat$ "u p>agraph 7#b7 = su* ye>1 su* limitation = ! succe$+ cal5d> ye> %all be increas$ by ! am\nt ( su* excess4 7#e7 ,au?orization ( us] fees 7,a7 ,9 g5]al ,! ,secret>y may *>ge a us] fee = a reque/ = an allocation ( ! limitation "u p>agraph 7#c74 7,b7 ,use ( fees ,any fees collect$ by ! ,secret>y pursuant to subp>agraph 7,a7 may be us$ to contract ) ?ird p>ties to v]ify in=mation relat+ to ! qualification ( an entity z a qualifi$ community developm5t f9ancial in/itution4 7,c7 ,limitation ,! fee *>g$ "u subp>agraph 7,a7 %all n exce$ #j4je p]c5t ( ! am\nt ( ! allocation reque/$4 7e7 ,regulations ,! ,secret>y %all prescribe su* regulations z may be appropriate to c>ry out ?is section1 includ+ regulations-- 7#a7 :i* limit ! cr$it "u ?is section = inve/m5ts :i* directly or indirectly receive a ,f$]al tax b5efit 7includ+ a cr$it "u section #db or an exclusion f gross income "u section #ajc71 7#b7 :i* prev5t ! abuse ( ! purposes ( ?is section1 7#c7 :i* impose appropriate report+ requirem5ts1 & 7#d7 :i* provide rules = allocations "u subsection 7d77#c7 to p]sons t h be5 c]tifi$ z em]g+ community developm5t f9ancial in/itutions "u section #aje ( ! ,community ,developm5t ,bank+ & ,f9ancial ,in/itutions ,act ( #aiid4 4 7b7 ,"p ( g5]al bus9ess cr$it ,section #ch7;b7 ( su* ,code is am5d$ by /rik+ plus at ! end ( p>agraph 7#dj71 by /rik+ ! p]iod at ! end ( p>agraph 7#da7 & ins]t+ 1 plus1 & by add+ at ! end ! foll[+ new p>agraph3 7#db7 ! ,,cdfi inve/m5t cr$it det]m9$ "u section #de;,,bb7a74 4 7c7 ,con=m+ am5dm5ts 7#a7 ,section #de;,d7b77#a7 ( ! ,int]nal ,rev5ue ,code ( #aihf is am5d$ by /rik+ & at ! end ( subp>agraph 7,b71 by /rik+ ! p]iod at ! end ( subp>agraph 7,c7 & ins]t+ 1 &1 & by add+ at ! end ! foll[+ new subp>agraph3 7,d7 su* inve/m5t has n be5 designat$ z a qualifi$ ,,cdfi inve/m5t = purposes ( section #de;,,bb4 4 7#b7 ,! table ( sections = subp>t ,d ( "p ,,iv ( sub*apt] ,a ( *apt] #a ( su* ,code is am5d$ by add+ at ! end ! foll[+ new item3 #de;,,bb4 ,community developm5t f9ancial in/itution inve/m5t tax cr$it4 4 7d7 ,effective date ,! am5dm5ts made by ?is section %all apply to inve/m5ts made aft] ! date ( ! enactm5t ( ?is ,act4 #c4 ,community developm5t equity funds ,section #aje ( ! ,community ,developm5t ,bank+ & ,f9ancial ,in/itutions ,act ( #aiid 7#ab ,u4,s4,c4 #dgjd7 is am5d$ by add+ at ! end ! foll[+3 7d7 ,community developm5t equity funds 7#a7 ,def9ition ,9 ?is subsection1 ! t]m community developm5t equity fund means a community developm5t f9ancial in/itution ) a managem5t entity t manages #a or m inve/m5t funds :]e a majority ( bo? ! numb] & doll> volume ( f9ancial products are equity or ne> equity inve/m5ts 9 small bus9esses locat$ 9 an inve/m5t area or small bus9esses majority own$ by a t>get$ population4 7#b7 ,qualifications ,9 an application = assi/ance "u ?is subtitle1 an applicant t is a community developm5t equity fund %all demon/rate1 to ! satisfaction ( ! ,secret>y1 t ! curr5t or propos$ managem5t team ( ! fund is qualifi$ & has ! k1 exp]i5ce1 & capability necess>y = inve/+ 9 ! types ( bus9esses contemplat$ by ?is ,act1 regulations implem5t+ ?is ,act1 & ! bus9ess plan ( ! fund4 7#c7 ,treatm5t ,! managem5t entity ( ! community developm5t equity fund & all ( its curr5t & future manag$ inve/m5t funds %all be treat$ z "o community developm5t f9ancial in/itution1 reg>dless ( ! sep>ation ( ! corporate /ructures1 if ! managem5t entity ma9ta9s control ov] ! inve/m5t decisions ( ! manag$ funds & has n made *anges to its managem5t team )\t approval ( ! ,secret>y4 4 #d4 ,em]g+ ,c,d,f,is ,section #aje ( ! ,community ,developm5t ,bank+ & ,f9ancial ,in/itutions ,act ( #aiid 7#ab ,u4,s4,c4 #dgjd71 z am5d$ by section #c ( ?is ,act1 is am5d$ by add+ at ! end ! foll[+3 7e7 ,em]g+ community developm5t f9ancial in/itutions 7#a7 ,9 g5]al ,an entity may submit to ! ,fund an application to be c]tifi$ z an em]g+ community developm5t f9ancial in/itution4 7#b7 ,bus9ess plan ,! application describ$ 9 p>agraph 7#a7 %all include a bus9ess plan t demon/rates t1 dur+ ! #ah-mon? p]iod beg9n+ on ! date on :i* ! bus9ess plan is approv$1 ! entity w meet ! requirem5ts ( subp>agraph 7,a7 ( section #ajc7e7 or subsection 7d7 ( ?is section4 4