Relating to investment tax credits and innovation fund tax credits, and including effective date and applicability provisions

This bill relates to investment tax credits and innovation fund tax credits. Under current law the economic development authority (authority) must allocate $2 million to investments in qualifying businesses and $8 million to equity investments in innovation funds (equity investments). The bill limits the authority’s tax credit allocations for investments in qualifying businesses and equity investments to a maximum aggregate of $10 million. The bill requires the authority to determine on or before June of each fiscal year the amount of tax credits to be allocated to each. In addition, any amount of tax credits allocated and not awarded in that fiscal year must be reallocated to either investments in qualifying businesses or to equity investments for the next fiscal year, and those tax credits do not count towards the maximum aggregate of $10 million. This applies to tax credits allocated on or after the fiscal year beginning July 1, 2021, and for each fiscal year thereafter. The bill modifies the maximum amount of an investment tax credit that may be issued to a natural person and the person’s spouse or dependent from a calendar year basis to a fiscal year basis. The maximum amount of tax credits that may be issued for equity investments in any one qualifying business is also modified from a calendar year to a fiscal year. The bill is effective upon enactment.