AB531-ASA1,30,2220 560.35 (2) (c) All qualified investments that the certified capital company has
21made during the previous calendar year preceding 6-month period and the
22investment pool from which each qualified investment was made.
AB531-ASA1, s. 80 23Section 80. 560.35 (2) (d) of the statutes is created to read:
AB531-ASA1,31,224 560.35 (2) (d) All amounts that the certified capital company has expended
25under s. 560.34 (1e) (a), the investment pool from which each such expenditure was

1made, and the percentage of the total amount of the investment pool which each such
2expenditure represents.
AB531-ASA1, s. 81 3Section 81. 560.35 (3) of the statutes is amended to read:
AB531-ASA1,31,194 560.35 (3) Financial statements. Within 90 days of the end of the certified
5capital company's fiscal year, the certified capital company shall provide to the
6department a copy of its annual audited financial statements, including the opinion
7of an independent certified public accountant, and a copy of a report on agreed-upon
8procedures prepared by an independent certified public accountant
. The audit shall
9address agreed-upon-procedures report shall identify the procedures performed by
10the certified capital company, as prescribed by the department, that relate to
the
11methods of operation and conduct of the business of the certified capital company to
12enable the department to determine whether the certified capital company is
13complying with this subchapter and the rules promulgated under this subchapter,
14including whether certified capital has been invested in the manner required under
15s. 560.34. The financial statements and agreed-upon-procedures report provided
16under this subsection shall be segregated by investment pool and shall be separately
17audited on that basis
to allow the department to determine whether the certified
18capital company is in compliance with s. 560.34 (1m) this subchapter and the rules
19promulgated under this subchapter
.
AB531-ASA1, s. 82 20Section 82. 560.36 (intro.) of the statutes is renumbered 560.36 (1) (intro.) and
21amended to read:
AB531-ASA1,31,2322 560.36 (1) (intro.) A Except as provided in sub. (2), a certified capital company
23may make a distribution only if one of the following conditions is met:
AB531-ASA1, s. 83 24Section 83. 560.36 (1) to (4) of the statutes are renumbered 560.36 (1) (a) to
25(d) and 560.36 (1) (c), as renumbered, is amended to read:
AB531-ASA1,32,7
1560.36 (1) (c) Placement of 100% 100 percent of investments in qualified
2investments.
The certified capital company has placed in qualified investments an
3amount equal to 100% 100 percent of the certified capital investments in the
4investment pool and at least 60 percent of the total amount of such investments
5purchased equity securities; options, warrants, or other equity participation
6instruments; or debt that is convertible into equity securities or options, warrants,
7or other equity participation instruments
.
AB531-ASA1, s. 84 8Section 84. 560.36 (2m) of the statutes is created to read:
AB531-ASA1,32,219 560.36 (2m) State participation. A certified capital company that receives
10certified capital investments under s. 560.32 (2) (b) 2. shall pay to the department,
11for deposit into the general fund, 30 percent of the net profits and gains realized by
12the certified capital company on qualified investments resulting from those certified
13capital investments, except that the payment required under this subsection is 20
14percent of those net profits and gains if the certified capital company, either
15concurrently with or after receiving certified capital investments under s. 560.32 (2)
16(b) 2., raises an additional pool of venture capital that does not contain certified
17capital investments and that is of a sufficient size and is sufficiently focused on
18investing in Wisconsin businesses, as determined by the department. A certified
19capital company shall make all payments required under this subsection
20concurrently with distributions of profits and gains to owners of the certified capital
21company.
AB531-ASA1, s. 85 22Section 85. 560.37 (1m) of the statutes is created to read:
AB531-ASA1,33,623 560.37 (1m) Reduced management fee. If a certified capital company violates
24s. 560.34 (1e) (c) or (1m) (a), the department may order the certified capital company
25to reduce its annual management fee to the percentage of the certified capital

1company's total certified capital, or the total dollar amount, specified in that order.
2A certified capital company may, within 10 days after receiving an order under this
3subsection, request a contested case hearing under s. 227.42 from the department.
4If the final administrative or judicial proceeding results in a determination that the
5order was issued in error or was unreasonable, the department shall rescind or revise
6the order accordingly.
AB531-ASA1, s. 86 7Section 86. 560.37 (3m) (a) (intro.) and 2. of the statutes are consolidated,
8renumbered 560.37 (3m) (a) and amended to read:
AB531-ASA1,33,139 560.37 (3m) (a) A certified capital company may voluntary decertify itself as
10a certified capital company if any of the following conditions are met: 2. The only
11if the
certified capital company has placed in qualified investments an amount equal
12to 100% 100 percent of the certified capital investment in the certified capital
13company.
AB531-ASA1, s. 87 14Section 87. 560.37 (3m) (a) 1. of the statutes is repealed.
AB531-ASA1, s. 88 15Section 88. 560.37 (4) of the statutes is amended to read:
AB531-ASA1,33,1816 560.37 (4) Effect of decertification. Decertification of a certified capital
17company or an investment pool has the effects specified in s. ss. 71.07 (7m) (e), 71.28
18(7m) (e), 71.47 (7) (d) and (7m) (e), and
76.635 (4).
AB531-ASA1, s. 89 19Section 89. 560.37 (5) of the statutes is amended to read:
AB531-ASA1,33,2320 560.37 (5) Notices to certified investors. The department shall notify a
21certified investor when the certified capital company tax credit arising from a
22certified investment is no longer subject to recapture and forfeiture under s. ss. 71.07
23(7m) (e), 71.28 (7m) (e), 71.47 (7) (d) and (7m) (e), and
76.635 (4).
AB531-ASA1, s. 90 24Section 90. Nonstatutory provisions.
AB531-ASA1,34,7
1(1 ) Performance evaluation audit. The joint legislative audit committee is
2requested to, and may, direct the legislative audit bureau to perform a performance
3evaluation audit of the program under subchapter II of chapter 560 of the statutes,
4which shall include evaluating the overall effectiveness of the program. If the
5committee directs the legislative audit bureau to perform an audit under this
6subsection, the bureau shall file its report as described in section 13.94 (1) (b) of the
7statutes by January 1, 2005.
AB531-ASA1,34,88 (2) Existing contracts.
AB531-ASA1,34,109 (a) Definition. In this subsection, "certified capital company" has the meaning
10given in section 560.30 (2) of the statutes.
AB531-ASA1,34,1911 (b) Effect on existing contracts. If a certified capital company is party to a
12contract that is in effect on the effective date of this paragraph and that contains
13provisions that are inconsistent with subchapter II of chapter 560 of the statutes, as
14affected by this act, but that are not inconsistent with any applicable law in effect
15immediately before the effective date of this paragraph, then, notwithstanding
16subchapter II of chapter 560 of the statutes, as affected by this act, the parties to the
17contract may perform their obligations, and exercise their rights, under those
18provisions of the contract until the contract expires or is extended, modified, or
19renewed, whichever occurs first.
AB531-ASA1, s. 91 20Section 91. Initial applicability.
AB531-ASA1,34,2421 (1) The treatment of sections 71.05 (6) (a) 15., 71.07 (7m), 71.10 (4) (cp), 71.21
22(4), 71.26 (2) (a), 71.28 (7m), 71.30 (3) (dm), 71.34 (1) (g), 71.45 (2) (a) 10., 71.47 (7)
23and (7m), 71.49 (1) (dm) and (dn), 77.92 (4), 560.30 (3), and 560.37 (4) and (5) of the
24statutes first applies to taxable years beginning on July 1, 2005.
AB531-ASA1,35,3
1(2) The treatment of section 560.32 (2) (b) 2. of the statutes, as it relates to
2claiming the credit under section 76.635 of the statutes first applies to taxable years
3beginning on July 1, 2005.
AB531-ASA1, s. 92 4Section 92. Effective dates. This act takes effect on the day after publication,
5except as follows:
AB531-ASA1,35,76 (1) Retroactive effect. The creation of sections 560.32 (3) (b) and 560.34 (1e)
7(a) and (b) of the statutes takes effect retroactively to May 13, 1998.
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