SB 825

Under this bill, a person who makes a qualified investment in a registered

community development financial institution (CDFI) may receive a credit against

state income and franchise taxes, for taxable years beginning after December 31,

2018, and before January 1, 2021, and against license fees paid by insurers. The bill

defines a CDFI as an entity that is organized under the laws of this state and has

been certified by the Community Development Financial Institutions Fund

established under federal law (fund) as meeting certain eligibility requirements.

The bill defines a “qualified investment" as a loan or deposit that has a value of at

least $10,000, pays no interest to the person making the loan or deposit, and is made

for a minimum of 60 months. The CDFI retains complete control of the loan or

deposit for the duration of the investment period.

A person may claim 10 percent of the person's qualified investment, if the

investment is at least $10,000, but not more than $150,000, or 12 percent of the

person's qualified investment, if the investment is more than $150,000, but not more

than $500,000. If the person withdraws the qualified investment from the CDFI

before the end of the investment period and does not reinvest the qualified

investment in another CDFI, the person must repay a portion of the credit amounts

that the person received by adding the portion to the person's tax or fee liability in

a subsequent year. However, the portion that the person must repay depends on

when the person withdraws the investment during the investment period. The

portion that the person must repay decreases the longer the person holds the

investment during the investment period.