LRBs0236/1
PJK&JK:kmg&jld&cmh:ch
2001 - 2002 LEGISLATURE
ASSEMBLY SUBSTITUTE AMENDMENT 1,
TO 2001 ASSEMBLY BILL 579
November 1, 2001 - Offered by Representative Ward.
AB579-ASA1,1,13
1An Act to renumber 560.32 (2) (c) and 560.35 (1m);
to renumber and amend
2560.32 (2) (b), 560.33 (1) (b) and 560.34 (1) (d);
to amend 71.45 (2) (a) 10., 560.30
3(3), 560.30 (10) (a), 560.30 (10) (c), 560.30 (10) (d), 560.31 (2) (b), 560.33 (1) (c),
4560.35 (2) (intro.), 560.35 (2) (a), 560.35 (2) (c), 560.37 (4) and 560.37 (5); and
5to create 71.47 (7), 71.49 (1) (dm), 560.30 (10) (e), 560.31 (2) (g), 560.32 (2) (b)
62., 560.32 (2) (c) 2., 560.32 (4), 560.33 (1) (b) 2., 560.34 (1) (d) 2., 560.34 (1m) (a)
73., 560.34 (1m) (a) 4., 560.35 (1c), 560.35 (1m) (b) and 560.35 (1r) of the statutes;
8relating to: certified capital investment limitations, qualified distributions of
9certified capital companies, creating a certified capital company income and
10franchise tax credit for insurers, certified capital company office, certified
11capital company net worth, qualified business requirements, qualified
12investment schedule, certified capital company reporting requirements, and
13requesting a performance audit.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB579-ASA1, s. 1
1Section
1. 71.45 (2) (a) 10. of the statutes is amended to read:
AB579-ASA1,2,72
71.45
(2) (a) 10. By adding to federal taxable income the amount of credit
3computed under s. 71.47 (1dd) to (1dx)
and (7) and not passed through by a
4partnership, limited liability company
, or tax-option corporation that has added that
5amount to the partnership's, limited liability company's
, or tax-option corporation's
6income under s. 71.21 (4) or 71.34 (1) (g) and the amount of credit computed under
7s. 71.47 (1), (3), (4)
, and (5).
AB579-ASA1,2,99
71.47
(7) Certified capital company credit. (a) In this subsection:
AB579-ASA1,2,1010
1. "Certified capital company" has the meaning given in s. 560.30 (2).
AB579-ASA1,2,1111
2. "Certified capital investment" has the meaning given in s. 560.30 (4).
AB579-ASA1,2,1212
3. "Investment date" has the meaning given in s. 560.30 (6).
AB579-ASA1,2,1313
4. "Investment pool" has the meaning given in s. 560.30 (7).
AB579-ASA1,2,1414
5. "Qualified investment" has the meaning given in s. 560.30 (11).
AB579-ASA1,2,2015
(b) An insurer who makes a certified capital investment may claim as a credit
16against the tax imposed under s. 71.43, for 10 years beginning with the year of the
17investment, an amount equal to either 10% of that investment or the amount by
18which the sum of the insurer's certified capital investments and the insurer's
19qualified investments exceeds the insurer's qualified investments in the taxable year
20before the insurer first claimed the credit under this section, whichever is less.
AB579-ASA1,2,2221
(c) Subsection 71.28 (4) (e), (f), (g), and (h), as it applies to the credit under 71.28
22(4), applies to the credit under this subsection.
AB579-ASA1,3,8
1(d) Partnerships, limited liability companies, and tax-option corporations may
2not claim the credit under this subsection, but the eligibility for, and the amount of,
3the credit are based on their payment of a certified capital investment. A
4partnership, limited liability company, or tax-option corporation shall compute the
5amount of credit that each of its partners, members, or shareholders may claim and
6shall provide that information to each of them. Partners, members of limited liability
7companies, and shareholders of tax-option corporations may claim the credit in
8proportion to their ownership interest.
AB579-ASA1,3,149
(e) 1. If a certified capital company is decertified, or an investment pool is
10disqualified, under s. 560.37 before the certified capital company fulfills the
11investment requirement under s. 560.34 (1m) (a) 1. with respect to the investment
12pool, any insurer that has received a credit under this subsection with respect to that
13investment pool shall repay that credit to the department of revenue and may not
14claim more credit in respect to that investment pool.
AB579-ASA1,3,2415
2. If a certified capital company fulfills the investment requirement under s.
16560.34 (1m) (a) 1. with respect to an investment pool but the certified capital
17company is decertified, or an investment pool is disqualified, under s. 560.37 before
18the certified capital company fulfills the investment requirement under s. 560.34
19(1m) (a) 2. for that investment pool, any insurer that has received a credit under this
20subsection with respect to that investment pool shall repay all credits that were
21claimed for taxable years after the taxable year that includes the 3rd anniversary of
22the investment date of the investment pool and may claim no more credits for taxable
23years after the taxable year that includes the 3rd anniversary of the investment date
24of the investment pool.
AB579-ASA1,4,4
1(f) An insurer may sell a credit under this subsection to another insurer who
2is subject to the tax imposed under s. 71.43 if the insurer notifies the commissioner
3of insurance and the department of revenue of the sale and includes with such
4notifications copies of the transfer documents.
AB579-ASA1,4,66
71.49
(1) (dm) Certified capital company credit under s. 71.47 (7).
AB579-ASA1,4,98
560.30
(3) "Certified capital company tax credit" means the tax credit under
9s. ss. 71.47 (7) and 76.635.
AB579-ASA1, s. 5
10Section
5. 560.30 (10) (a) of the statutes is amended to read:
AB579-ASA1,4,1311
560.30
(10) (a) The costs of forming
,
and syndicating
, managing or operating 12the certified capital company
, not to exceed 5% of the certified capital company's total
13certified capital.
AB579-ASA1, s. 6
14Section
6. 560.30 (10) (c) of the statutes is amended to read:
AB579-ASA1,4,1715
560.30
(10) (c) Reasonable and necessary fees paid for professional services
16related to the operation of the certified capital company
, not to exceed 5% of the
17certified capital company's total certified capital unless approved by the department.
AB579-ASA1, s. 7
18Section
7. 560.30 (10) (d) of the statutes is amended to read:
AB579-ASA1,4,2219
560.30
(10) (d) A projected increase in federal or state taxes,
including 20excluding penalties and interest on those taxes, of the equity owners of the certified
21capital company if those amounts are related to the certified capital company's
22ownership, management
, or operation.
AB579-ASA1, s. 8
23Section
8. 560.30 (10) (e) of the statutes is created to read:
AB579-ASA1,4,2524
560.30
(10) (e) Reasonable costs associated with applying for qualified federal
25funding programs, as determined by the department.
AB579-ASA1,5,42
560.31
(2) (b)
The At the time of application and on the date on which the person
3is certified, the person has a net worth
, at the time of application, of at least $500,000
4and
has at least $500,000 in cash, cash equivalents
, and marketable securities.
AB579-ASA1,5,76
560.31
(2) (g) The person agrees to maintain in this state an investment office
7and staff actively engaged in making investments.
AB579-ASA1, s. 11
8Section
11. 560.32 (2) (b) of the statutes is renumbered 560.32 (2) (b) 1. and
9amended to read:
AB579-ASA1,5,1310
560.32
(2) (b) 1.
The Prior to the effective date of this subdivision .... [revisor
11inserts date], the department may certify an investment under this subsection only
12if, after the certification, the department will not have certified a total of more than
13$50,000,000 in investments under this subsection.
AB579-ASA1, s. 12
14Section
12. 560.32 (2) (b) 2. of the statutes is created to read:
AB579-ASA1,5,1715
560.32
(2) (b) 2. The department may, beginning on the effective date of this
16subdivision .... [revisor inserts date], certify up to $100,000,000 in investments under
17this subsection, excluding any investments certified under subd. 1.
AB579-ASA1, s. 13
18Section
13. 560.32 (2) (c) of the statutes is renumbered 560.32 (2) (c) 1.
AB579-ASA1, s. 14
19Section
14. 560.32 (2) (c) 2. of the statutes is created to read:
AB579-ASA1,5,2420
560.32
(2) (c) 2. The department may not certify an investment under par. (b)
212. if, after the certification, the investor, together with all affiliates of the investor,
22would have in certified capital investments under par. (b) 2. more than the greater
23of $10,000,000 or 15% of the total amount of investments that the department may
24certify under par. (b) 2.
AB579-ASA1,6,5
1560.32
(4) Prohibition on returning initial investments. (a) Except as
2provided in par. (b), a person that is certified as a certified capital company under s.
3560.31 may not return to investors investments that were made in the certified
4capital company prior to its certification for the purpose of enabling the person to
5meet the requirements under s. 560.31 (2) (b).
AB579-ASA1,6,96
(b) Paragraph (a) does not apply to an investment made in a certified capital
7company prior to its certification if compliance with par. (a) would impair any
8provision of a contract between the certified capital company and the investor that
9was entered into before the effective date of this paragraph .... [revisor inserts date].
AB579-ASA1, s. 16
10Section
16. 560.33 (1) (b) of the statutes is renumbered 560.33 (1) (b) (intro.)
11and amended to read:
AB579-ASA1,6,1312
560.33
(1) (b) (intro.) The business has no more than 100 employees
, at and any
13of the following applies:
AB579-ASA1,6,14
141. At least 75% of
whom those employees are employed in this state.
AB579-ASA1, s. 17
15Section
17. 560.33 (1) (b) 2. of the statutes is created to read:
AB579-ASA1,6,1716
560.33
(1) (b) 2. At least 75% of the total payroll of the business is paid to
17employees who are employed in this state.
AB579-ASA1,7,219
560.33
(1) (c) During its 2 most recent fiscal years, the business had, together
20with all of its consolidated affiliates, an average annual net income, after federal
21income taxes and excluding any carry-over losses, of not more than $2,000,000, as
22determined in accordance with generally accepted accounting principles.
For
23purposes of this paragraph, a partnership, limited liability company, or tax-option
24corporation shall calculate its net annual income based on the net annual income,
25after federal income taxes and excluding any carry-over losses, of its partners,
1members, or shareholders that is related to the economic activity of the partnership,
2limited liability company, or tax-option corporation.
AB579-ASA1, s. 19
3Section
19. 560.34 (1) (d) of the statutes is renumbered 560.34 (1) (d) (intro.)
4and amended to read:
AB579-ASA1,7,75
560.34
(1) (d) (intro.) As a condition of the investment, the qualified business
6agrees, as long as the certified capital corporation continues to hold the investment,
7to
maintain do any of the following: