AB531: Bill Text

AB531, s. 9 Section 9. 560.31 (2) (g) of the statutes is created to read:

AB531,8,21 560.31 (2) (g) The person agrees to maintain in this state an investment office and staff actively engaged in making investments.

AB531, s. 10 Section 10. 560.32 (2) (b) of the statutes is renumbered 560.32 (2) (b) 1. and amended to read:

AB531,9,2 560.32 (2) (b) 1. The Prior to the effective date of this subdivision .... [revisor inserts date], the department may certify an investment under this subsection only if, after the certification, the department will not have certified a total of more than $50,000,000 in investments under this subsection.

AB531, s. 11 Section 11. 560.32 (2) (b) 2. of the statutes is created to read:

AB531,9,7 560.32 (2) (b) 2. Beginning on the effective date of this subdivision .... [revisor inserts date], the department shall certify investments for which notices have been received under par. (a), up to $300,000,000, excluding any investments certified under subd. 1.

AB531, s. 12 Section 12. 560.32 (2) (c) of the statutes is renumbered 560.32 (2) (c) 1.

AB531, s. 13 Section 13. 560.32 (2) (c) 2. of the statutes is created to read:

AB531,9,14 560.32 (2) (c) 2. The department may not certify an investment under par. (b) 2. if, after the certification, the investor, together with all affiliates of the investor, would have in certified capital investments under par. (b) 2. more than the greater of $10,000,000 or 15% of the total amount of investments that the department may certify under par. (b) 2.

AB531, s. 14 Section 14. 560.33 (1) (intro.) of the statutes is amended to read:

AB531,9,20 560.33 (1) Qualifications. (intro.) A Except as provided in sub. (2), a business is a qualified business if all of the following requirements are met, as of the time that a certified capital company, or any affiliate of the certified capital company, makes its first investment in the business, investment in the business will further economic development in this state or all of the following requirements are met:

AB531, s. 15 Section 15. 560.33 (1) (b) of the statutes is renumbered 560.33 (1) (b) (intro.) and amended to read:

AB531,9,24 560.33 (1) (b) (intro.) The business has no more than 100 employees, at and any of the following applies:

AB531,9,25 1. At least 75% of whom those employees are employed in this state.

AB531, s. 16 Section 16. 560.33 (1) (b) 2. of the statutes is created to read:

AB531,10,3 560.33 (1) (b) 2. At least 75% of the total payroll of the business is paid to employees who are employed in this state.

AB531, s. 17 Section 17. 560.33 (2) of the statutes is amended to read:

AB531,10,16 560.33 (2) Department opinions and exceptions. A certified capital company may shall, prior to making an investment in a specific business, request a written opinion from the department that a business in which it proposes to invest is a qualified business. If the department determines that the business meets the requirements under sub. (1), the department shall issue a written opinion stating that the business is a qualified business Within 15 days of receiving the request, the department shall determine whether the business is a qualified business and, if the business is not a qualified business, notify the certified capital company in writing of the determination and the reasons for the determination. If the department fails to so notify the certified capital company within 15 days of receiving the request, the business shall be deemed a qualified business, notwithstanding any failure to satisfy sub. (1).

AB531, s. 18 Section 18. 560.34 (1) (c) of the statutes is amended to read:

AB531,10,20 560.34 (1) (c) As a condition of the investment, the qualified business agrees, as long as the certified capital corporation company continues to hold the investment, not to relocate its headquarters out of this state.

AB531, s. 19 Section 19. 560.34 (1) (d) of the statutes is renumbered 560.34 (1) (d) (intro.) and amended to read:

AB531,10,25 560.34 (1) (d) (intro.) As a condition of the investment, the qualified business agrees, as long as the certified capital corporation company continues to hold the investment, to maintain do any of the following:

AB531,11,1 1. Maintain at least 75% of its employees in this state.

AB531, s. 20 Section 20. 560.34 (1) (d) 2. of the statutes is created to read:

AB531,11,4 560.34 (1) (d) 2. Pay at least 75% of its total payroll to employees who are employed in this state.

AB531, s. 21 Section 21. 560.34 (1) (e) of the statutes is amended to read:

AB531,11,13 560.34 (1) (e) As a condition of the investment, the qualified business agrees, as long as the certified capital corporation company continues to hold the investment, to maintain at least 75% of its employees at work sites that were maintained by the qualified business at the time that the investment was made, unless the qualified business obtains an exemption from the department under this paragraph. The department may grant an exemption unless it determines that the qualified business is locating the employees at new sites to take advantage of lower wage rates in the areas where the new sites are located.

AB531, s. 22 Section 22. 560.34 (1m) (b) of the statutes is amended to read:

AB531,12,2 560.34 (1m) (b) The proceeds of all capital of a qualified investment returned to a certified capital company by a qualified business may be placed in new qualified investments, which shall count toward the percentage requirements under par. (a) and s. 560.36 (3). The department shall promulgate rules governing the extent to which a reinvestment of proceeds from the sale of a qualified investment in a qualified business may be counted toward the percentage requirements under par. (a) and ss. 560.36 (3) and 560.37 (3m) (a) 2. These rules may provide that reinvested proceeds from the sale of short-term investments shall be only partially counted toward the percentage requirements under par. (a) and ss. 560.36 (3) and 560.37 (3m) (a) 2. The rules may also provide that proceeds from the sale of an investment in a qualified business that are reinvested in that qualified business, or an affiliate of that qualified business, shall be only partially counted toward the percentage requirements under par. (a) and ss. 560.36 (3) and 560.37 (3m) (a) 2.

AB531, s. 23 Section 23. 560.34 (2) of the statutes is renumbered 560.34 (2) (intro.) and amended to read:

AB531,12,10 560.34 (2) (intro.) Nonqualified investments. All certified capital investments in a certified capital company that are not invested in qualified investments may be held or invested by the certified capital company as it considers appropriate, except that a certified capital company may not invest certified capital investments in an insurance company or in an affiliate of an insurance company. only in any of the following:

AB531, s. 24 Section 24. 560.34 (2) (a) to (k) of the statutes are created to read:

AB531,12,13 560.34 (2) (a) Deposits with a federally insured financial institution, as defined in s. 705.01 (3).

AB531,12,15 (b) Certificates of deposit in a federally insured financial institution, as defined in s. 705.01 (3).

AB531,12,18 (c) Investment securities that are obligations of the United States or its agencies or instrumentalities, or that are obligations that are guaranteed fully as to principal and interest by the United States.

AB531,12,20 (d) Commercial paper rated at least "A1," "P1," or the equivalent, by a nationally recognized credit rating organization.

AB531,12,22 (e) Debt instruments rated at least "AA" or its equivalent by a nationally recognized credit rating organization.

AB531,13,2 (f) Debt instruments issued by, or guaranteed with respect to payment by, an entity whose unsecured indebtedness is rated at least "AA" or its equivalent by a nationally recognized credit rating organization and which are not subordinated to other unsecured indebtedness of the issuer or guarantor, as applicable.

AB531,13,5 (g) Swaps or other hedging transactions designed to realize or protect the value of a qualified investment, if the counterparty is rated at least "A" or its equivalent by a nationally recognized credit rating organization.

AB531,13,6 (h) Obligations of the state or any political subdivision of the state.

AB531,13,8 (i) Interests in money market or other mutual funds, the portfolios of which are limited to cash and other permissible investments described in this subsection.

AB531,13,9 (j) A small business investment company that is approved by the department.

AB531,13,10 (k) Any other investments approved in advance in writing by the department.

AB531, s. 25 Section 25. 560.34 (5) of the statutes is created to read:

AB531,13,16 560.34 (5) Qualified investment becoming nonqualified. (a) If a certified capital company makes an investment in a qualified business and, after the effective date of this paragraph .... [revisor inserts date], and during the time that the certified capital company still holds the investment, the qualified business violates an agreement made under sub. (1) (b) to (e), all of the following apply:

AB531,13,20 1. The violation does not affect the certified capital company's satisfaction of the percentage requirements under sub. (1m) (a) 1. or 2., and 100% of the amount of the qualified investment shall be counted toward the certified capital company's satisfaction of those percentage requirements.

AB531,13,24 2. If the violation occurs within the first year after the qualified investment was made, no amount of the qualified investment shall be counted toward the certified capital company's satisfaction of the percentage requirements under ss. 560.36 (3) and 560.37 (3m) (a).

AB531,14,4 3. If the violation occurs more than one year, but 3 years or less, after the qualified investment was made, only 25% of the amount of the qualified investment shall be counted toward the certified capital company's satisfaction of the percentage requirements under ss. 560.36 (3) and 560.37 (3m) (a).

AB531,14,8 4. If the violation occurs more than 3 years, but 5 years or less, after the qualified investment was made, only 50% of the amount of the qualified investment shall be counted toward the certified capital company's satisfaction of the percentage requirements under ss. 560.36 (3) and 560.37 (3m) (a).

AB531,14,12 5. If the violation occurs more than 5 years after the qualified investment was made, 90% of the amount of the qualified investment shall be counted toward the certified capital company's satisfaction of the percentage requirements under ss. 560.36 (3) and 560.37 (3m) (a).

AB531,14,19 (b) Notwithstanding par. (a), if a qualified business violates an agreement under sub. (1) (b), (c), (d), or (e), the department may grant an exception to the requirements under par. (a) 2. to 5. and not reduce the amount of the qualified investment that is counted toward the certified capital company's satisfaction of the percentage requirements under ss. 560.36 (3) and 560.37 (3m) (a), unless the department determines that the qualified business is locating employees at new sites to take advantage of lower wage rates in the areas where those sites are located.

AB531, s. 26 Section 26. 560.35 (1c) of the statutes is created to read:

AB531,14,23 560.35 (1c) Qualified investments. Within 15 days after making a qualified investment, a certified capital company shall report all of the following to the department:

AB531,14,25 (a) The name of the qualified business in which the qualified investment was made.

AB531,15,1 (b) The amount of the qualified investment.

AB531,15,2 (c) The type of investment, as specified in s. 560.34 (1) (a) 1. or 2. a. or b.

AB531, s. 27 Section 27. 560.35 (1r) of the statutes is created to read:

AB531,15,9 560.35 (1r) Qualified investment schedule report. Within 30 days after the conclusion of each time period specified in s. 560.34 (1m) (a), a certified capital company shall report to the department, in the format and substance prescribed by the department, information required by the department for determining whether the certified capital company is in compliance with the percentage requirements under s. 560.34 (1m) (a).

AB531, s. 28 Section 28. 560.35 (2) (intro.) of the statutes is amended to read:

AB531,15,15 560.35 (2) Annual Semiannual reports. (intro.) On Each year, on or before January 31 annually, for the preceding 6-month period ending on December 31, and on or before July 31, for the preceding 6-month period ending on June 30, a certified capital company shall report, in the format and substance prescribed by the department, all of the following to the department:

AB531, s. 29 Section 29. 560.35 (2) (a) of the statutes is amended to read:

AB531,15,18 560.35 (2) (a) The amount of the certified capital company's certified capital at the end of the preceding year 6-month period.

AB531, s. 30 Section 30. 560.35 (2) (c) of the statutes is amended to read:

AB531,15,22 560.35 (2) (c) All qualified investments that the certified capital company has made during the previous calendar year preceding 6-month period and the investment pool from which each qualified investment was made.

AB531, s. 31 Section 31. 560.35 (3) of the statutes is amended to read:

AB531,16,14 560.35 (3) Financial statements. Within 90 days of the end of the certified capital company's fiscal year, the certified capital company shall provide to the department a copy of its annual audited financial statements, including the opinion of an independent certified public accountant, and a copy of a report on agreed-upon procedures prepared by an independent certified public accountant. The audit shall address agreed-upon-procedures report shall identify the procedures performed by the certified capital company, as prescribed by the department, that relate to the methods of operation and conduct of the business of the certified capital company to enable the department to determine whether the certified capital company is complying with this subchapter and the rules promulgated under this subchapter, including whether certified capital has been invested in the manner required under s. 560.34. The financial statements and agreed-upon-procedures report provided under this subsection shall be segregated by investment pool and shall be separately audited on that basis to allow the department to determine whether the certified capital company is in compliance with s. 560.34 (1m) this subchapter and the rules promulgated under this subchapter.

AB531, s. 32 Section 32. 560.37 (3m) (a) (intro.) and 2. of the statutes are consolidated, renumbered 560.37 (3m) (a) and amended to read:

AB531,16,20 560.37 (3m) (a) A certified capital company may voluntary decertify itself as a certified capital company if any of the following conditions are met: 2. The only if the certified capital company has placed in qualified investments an amount equal to 100% of the certified capital investment in the certified capital company.

AB531, s. 33 Section 33. 560.37 (3m) (a) 1. of the statutes is repealed.

AB531, s. 34 Section 34. 560.37 (4) of the statutes is amended to read:

AB531,16,25 560.37 (4) Effect of decertification. Decertification of a certified capital company or an investment pool has the effects specified in s. ss. 71.47 (7) (d) and 76.635 (4).

AB531, s. 35 Section 35. 560.37 (5) of the statutes is amended to read:

AB531,17,5 560.37 (5) Notices to certified investors. The department shall notify a certified investor when the certified capital company tax credit arising from a certified investment is no longer subject to recapture and forfeiture under s. ss. 71.47 (7) (d) and 76.635 (4).

AB531, s. 36 Section 36. Nonstatutory provisions.

AB531,17,13 (1) Performance evaluation audit. The joint legislative audit committee is requested to, and may, direct the legislative audit bureau to perform a performance evaluation audit of the program under subchapter II of chapter 560 of the statutes, which shall include evaluating the overall effectiveness of the program. If the committee directs the legislative audit bureau to perform an audit under this subsection, the bureau shall file its report as described in section 13.94 (1) (b) of the statutes by January 1, 2005.

AB531, s. 37 Section 37. Initial applicability.

AB531,17,17 (1) The treatment of sections 71.45 (2) (a) 10., 71.47 (7), 71.49 (1) (dm), 560.30 (3), and 560.37 (4) and (5) of the statutes first applies to taxable years beginning on July 1, 2005.

AB531,17,23 (2) The treatment of sections 560.31 (2) (b) and (g) of the statutes, the renumbering and amendment of sections 560.33 (1) (b) and 560.34 (1) (d) and (2) of the statutes, and the creation of sections 560.33 (1) (b) 2. and 560.34 (1) (d) 2. and (2) (a) to (h) of the statutes first apply to certified capital companies for which certified capital investments are first certified, and to certified capital investments that are first certified, on the effective date of this subsection.

AB531,17,24 (End)