CHAPTER 578
DEPARTMENT OF ECONOMIC AND COMMUNITY DEVELOPMENT

Table of Contents

Secs. 32-1h to 32-1j. Reports re financial assistance programs administered by commissioner. Reports re program objectives, measures and standards; economic analysis of program performance. Reports re sectors of state economy.
Sec. 32-1m. Annual report re activities of Department of Economic and Community Development.
Sec. 32-1n. Reports re funding for economic and industry cluster initiatives.
Sec. 32-4g. Economic cluster report by the Commissioner of Economic and Community Development.
Sec. 32-9s. State grants in lieu of taxes on exempt property of manufacturing facilities in distressed municipalities, targeted investment communities or enterprise zones and exempt property of service facilities.
Sec. 32-9t. Urban and industrial site reinvestment program. Registration of fund managers. Tax credits.
Sec. 32-9qq. Business outreach center challenge grants. Eligibility of greenways projects.
Sec. 32-9uu. Program to increase entrepreneurial potential in the inner cities.

      Secs. 32-1h to 32-1j. Reports re financial assistance programs administered by commissioner. Reports re program objectives, measures and standards; economic analysis of program performance. Reports re sectors of state economy. Sections 32-1h to 32-1j, inclusive, are repealed, effective October 1, 2005.

      (P.A. 93-382, S. 1, 6, 7, 69; P.A. 95-250, S. 1, 38, 42; 95-309, S. 11, 12; P.A. 96-211, S. 1, 5, 6; P.A. 00-212, S. 3; P.A. 01-96, S. 1; P.A. 03-26, S. 1; 03-197, S. 1; P.A. 05-191, S. 12.)

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      Sec. 32-1m. Annual report re activities of Department of Economic and Community Development. Not later than February 1, 2006, and annually thereafter, the Commissioner of Economic and Community Development shall submit a report to the Governor and the General Assembly, in accordance with the provisions of section 11-4a. Not later than thirty days after submission of the report to the Governor and the General Assembly, said commissioner shall post the report on the Department of Economic and Community Development's web site. Said report shall include, but not be limited to, the following information with regard to the activities of the Department of Economic and Community Development during the preceding state fiscal year:

      (1) A brief description and assessment of the state's economy during such year, utilizing the most recent and reasonably available data, and including:

      (A) Connecticut employment by industry;

      (B) Connecticut and national average unemployment;

      (C) Connecticut gross state product, by industry;

      (D) Connecticut productivity, by industry, compared to the national average;

      (E) Connecticut manufacturing activity;

      (F) Identification of economic and competitive conditions affecting Connecticut's industry sectors, problems resulting from these conditions and state efforts to address the problems; and

      (G) Any other economic information that the commissioner deems appropriate.

      (2) A statement of the department's economic and community development objectives, measures of program success and standards for granting financial and nonfinancial assistance under programs administered by the department.

      (3) An analysis of the economic development portfolio of the department, including:

      (A) A list of the names, addresses and locations of all recipients of the department's assistance;

      (B) The following information concerning each recipient of such assistance: (i) Business activities, (ii) standard industrial classification codes or North American industrial classification codes, (iii) number of full-time jobs and part-time jobs at the time of application, (iv) number of actual full-time jobs and actual part-time jobs at application during the preceding state fiscal year, (v) whether the recipient is a minority or woman-owned business, (vi) a summary of the terms and conditions for the assistance, including the type and amount of state financial assistance, job creation or retention requirements and anticipated wage rates, (vii) the amount of investments from private and other nonstate sources that have been leveraged by the assistance, (viii) the extent to which employees of the recipient participate in health benefit plans offered by such recipient, (ix) the extent to which the recipient offers unique economic, social, cultural or aesthetic attributes to the municipality in which the recipient is located or to the state, and (x) the amount of state investment;

      (C) A portfolio analysis, including (i) an analysis of the wages paid by recipients of financial assistance, (ii) the average portfolio wage, median portfolio wage, highest and lowest portfolio wage, (iii) portfolio wage data by industry, and (iv) portfolio wage data by municipality;

      (D) An investment analysis, including (i) total portfolio value, (ii) total investment by industry, (iii) portfolio dollar per job average, (iv) portfolio leverage ratio, and (v) percentage of financial assistance which was provided to high performance work organizations in the preceding state fiscal year; and

      (E) An analysis of the estimated economic effects of the department's economic development investments on the state's economy, including (i) contribution to gross state product for the total economic development portfolio and for any investment activity occurring in the preceding state fiscal year, (ii) direct and indirect employment created by the investments for the total portfolio and for any investment activity occurring in the preceding state fiscal year, (iii) productivity of recipients of financial assistance as a result of the department's investment occurring in the preceding state fiscal year, (iv) directly or indirectly increased property values in the municipalities in which the recipients of assistance are located, and (v) personal income.

      (4) An analysis of the community development portfolio of the department, including:

      (A) A list of the names, addresses and locations of all recipients of the department's assistance;

      (B) The following information concerning each recipient of such assistance: (i) Amount of state investment, (ii) a summary of the terms and conditions for the department's assistance, including the type and amount of state financial assistance, and (iii) the amount of investments from private and other nonstate sources that have been leveraged by such assistance;

      (C) An investment analysis, including (i) total active portfolio value, (ii) total investments made in the preceding state fiscal year, (iii) total portfolio by municipality, (iv) total investments made in the preceding state fiscal year categorized by municipality, (v) total portfolio leverage ratio, and (vi) leverage ratio of the total investments made in the preceding state fiscal year; and

      (D) An analysis of the estimated economic effects of the department's economic development investments on the state's economy, including (i) contribution to gross state product for the total portfolio and for any investment activity occurring in the preceding state fiscal year, (ii) direct and indirect employment created by the investments for the total portfolio and for any investment activity occurring in the preceding state fiscal year, (iii) productivity of recipients of financial assistance as a result of the department's investment occurring in the preceding state fiscal year, (iv) directly or indirectly increased property values in the municipalities in which the recipients are located, and (v) personal income.

      (5) A summary of the department's economic and community development marketing efforts in the preceding state fiscal year, a summary of the department's business recruitment strategies and activities in such year, and a summary of the department's efforts to assist small businesses and minority business enterprises in such year.

      (6) A summary of the department's international trade efforts in the preceding state fiscal year, and, to the extent possible, a summary of foreign direct investment that occurred in the state in such year.

      (7) Identification of existing economic clusters, the formation of new economic clusters and the measures taken by the commissioner during the preceding state fiscal year to encourage the growth of economic clusters.

      (8) (A) A summary of the department's brownfield-related efforts and activities in the preceding state fiscal year, except for activity under the Special Contaminated Property Remediation and Insurance Fund program. Such efforts shall include, but not be limited to (i) total portfolio investment in brownfield remediation projects, (ii) total investment in brownfield remediation projects in the preceding state fiscal year, (iii) total number of brownfield remediation projects, (iv) total number of brownfield remediation projects in the preceding state fiscal year, (v) total of reclaimed and remediated acreage, (vi) total of reclaimed and remediated acreage in the preceding state fiscal year, (vii) leverage ratio for the total portfolio investment in brownfield remediation projects, and (viii) leverage ratio for the total portfolio investment in brownfield remediation projects in the preceding state fiscal year. Such summary shall include a list of such brownfield remediation projects and, for each such project, the name of the developer and the location by street address and municipality; and

      (B) A summary of the department's efforts with regard to the Special Contaminated Property Remediation and Insurance Fund, including, but not limited to, (i) the number of applications received in the preceding state fiscal year, (ii) the number and amounts of loans made in such year, (iii) the names of the applicants for such loans, (iv) the average time period between submission of application and the decision to grant or deny the loan, (v) a list of the applications approved and the applications denied and the reasons for such denials, and (vi) for each project, the location by street address and municipality.

      (9) The following concerning enterprise zones designated under section 32-70:

      (A) A statement of the current goals for enterprise zones;

      (B) A statement of the current performance standards to measure the progress of municipalities that have enterprise zones in attaining the goals for such zones;

      (C) A report from each municipality that has an enterprise zone, which evaluates the progress of the municipality in meeting the performance standards established under subsection (a) of section 32-70a; and

      (D) An assessment of the performance of each enterprise zone based on information collected under subparagraph (C) of this subdivision.

      (10) With regard to the department's housing-development-related functions and activities:

      (A) A brief description and assessment of the state's housing market during the preceding state fiscal year, utilizing the most recent and reasonably available data, and including, but not be limited to, (i) a brief description of the significant characteristics of such market, including supply, demand and condition and cost of housing, and (ii) any other information that the commissioner deems appropriate;

      (B) An analysis of the progress of the public and private sector toward meeting housing needs in the state, using building permit data from the United States Census Bureau and demolition data from Connecticut municipalities;

      (C) A list of municipalities that meet the affordable housing criteria set forth in subsection (k) of section 8-30g, pursuant to regulations that the Commissioner of Economic and Community Development shall adopt pursuant to the provisions of chapter 54. For the purpose of determining the percentage required by subsection (k) of said section 8-30g, the commissioner shall use as the denominator the number of dwelling units in the municipality, as reported in the most recent United States decennial census;

      (D) A statement of the department's housing development objectives, measures of program success and standards for granting financial and nonfinancial assistance under programs administered by said commissioner.

      (11) A presentation of the state funded housing development portfolio of the department, including:

      (A) A list of the names, addresses and locations of all recipients of such assistance; and

      (B) For each such recipient, (i) a summary of the terms and conditions for the assistance, including the type and amount of state financial assistance, (ii) the amount of investments from private and other nonstate sources that have been leveraged by the assistance, (iii) the number of new units to be created and the number of units to be preserved at the time of the application, and (iv) the number of actual new units created and number of units preserved.

      (12) An analysis of the state funded housing development portfolio of the department, including:

      (A) An investment analysis, including the (i) total active portfolio value, (ii) total investment made in the preceding state fiscal year, (iii) portfolio dollar per new unit created, (iv) estimated dollars per new unit created for projects receiving an assistance award in the preceding state fiscal year, (v) portfolio dollars per unit preserved, (vi) estimated dollar per unit preserved for projects receiving an assistance award in the preceding state fiscal year, (vii) portfolio leverage ratio, and (viii) leverage ratio for housing development investments made in the preceding state fiscal year; and

      (B) A production and preservation analysis, including the (i) total number of units created, itemized by municipality for the total portfolio and projects receiving an assistance award in the preceding state fiscal year, (ii) total number of elderly units created for the total portfolio and for projects receiving an assistance award in the preceding state fiscal year, (iii) total number of family units created for the total portfolio and for projects receiving an assistance award in the preceding state fiscal year, (iv) total number of units preserved, itemized by municipality for the total portfolio and projects receiving an assistance award in the preceding state fiscal year, (v) total number of elderly units preserved for the total portfolio and for projects receiving an assistance award in the preceding state fiscal year, (vi) total number of family units preserved for the total portfolio and for projects receiving an assistance award in the preceding state fiscal year, (vii) an analysis by income group, of households served by the department's housing construction, substantial rehabilitation, purchase and rental assistance programs, for each housing development, if applicable, and for each program, including number of households served under each program by race and data for all households, and (viii) a summary of the department's efforts in promoting fair housing choice and racial and economic integration including data on the racial composition of the occupants and persons on the waiting list of each housing project that is assisted under any housing program established by the general statutes or a special act or that is supervised by the department, provided no information shall be required to be disclosed by any occupant or person on a waiting list for the preparation of such summary. As used in this subparagraph, "elderly units" means dwelling units for which occupancy is restricted by age, and "family units" means dwelling units for which occupancy is not restricted by age.

      (13) An economic impact analysis of the department's housing development efforts and activities, including, but not limited to:

      (A) The contribution of such efforts and activities to the gross state product;

      (B) The direct and indirect employment created by the investments for the total housing development portfolio and for any investment activity for such portfolio occurring in the preceding state fiscal year; and

      (C) Personal income in the state.

      (14) With regard to the department's energy conservation loan program:

      (A) The number of loans or deferred loans made during the preceding fiscal year under each component of such program and the total amount of the loans or deferred loans made during such fiscal year under each such component;

      (B) A description of each step of the loan or deferred loan application and review process;

      (C) The location of each loan or deferred loan application intake site for such program;

      (D) The average period for the processing of loan or deferred loan applications during such fiscal year; and

      (E) The total administrative expenses of such program for such fiscal year.

      (15) A summary of the total social and economic impact of the department's efforts and activities in the areas of economic, community and housing development and an assessment of the department's performance in terms of meeting its stated goals and objectives.

      (P.A. 05-191, S. 1.)

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      Sec. 32-1n. Reports re funding for economic and industry cluster initiatives. Not later than December 31, 2006, the Commissioner of Economic and Community Development shall prepare a report (1) indicating any amount of funds allocated by the Department of Economic and Community Development during the fiscal year ending June 30, 2006, for economic and industry cluster initiatives, and (2) including recommendations concerning the adequacy of such funds, and shall submit such report to the Governor and the joint standing committees of the General Assembly having cognizance of matters relating to commerce, finance, revenue and bonding and appropriations, in accordance with the provisions of section 11-4a.

      (P.A. 05-276, S. 1.)

      History: P.A. 05-276 effective July 13, 2005.

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      Sec. 32-4g. Economic cluster report by the Commissioner of Economic and Community Development. Section 32-4g is repealed, effective October 1, 2005.

      (P.A. 96-252, S. 3, 8; P.A. 05-191, S. 12.)

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      Sec. 32-9s. State grants in lieu of taxes on exempt property of manufacturing facilities in distressed municipalities, targeted investment communities or enterprise zones and exempt property of service facilities. The state shall make an annual grant payment to each municipality, to each district, as defined in section 7-325, which is located in a distressed municipality, targeted investment community or enterprise zone and to each special services district created pursuant to chapter 105a which is located in a distressed municipality, targeted investment community or enterprise zone in the amount of fifty per cent of the amount of that tax revenue which the municipality or district would have received except for the provisions of subdivisions (59), (60) and (70) of section 12-81. On or before the first day of August of each year, each municipality and district shall file a claim with the Secretary of the Office of Policy and Management for the amount of such grant payment to which such municipality or district is entitled under this section. The claim shall be made on forms prescribed by the secretary and shall be accompanied by such supporting information as the secretary may require. Any municipality or district which neglects to transmit to the secretary such claim and supporting documentation as required by this section shall forfeit two hundred fifty dollars to the state, provided the secretary may waive such forfeiture in accordance with procedures and standards adopted by regulation in accordance with chapter 54. The secretary shall review each such claim as provided in section 12-120b. Any claimant aggrieved by the results of the secretary's review shall have the rights of appeal as set forth in section 12-120b. The secretary shall, on or before the December fifteenth next succeeding the deadline for the receipt of such claims, certify to the Comptroller the amount due under this section, including any modification of such claim made prior to December fifteenth, to each municipality or district which has made a claim under the provisions of this section. The Comptroller shall draw an order on the Treasurer on or before the fifth business day following December fifteenth, and the Treasurer shall pay the amount thereof to each such municipality or district on or before the following December thirty-first. If any modification is made as the result of the provisions of this section on or after the December first following the date on which the municipality or district has provided the amount of tax revenue in question, any adjustment to the amount due to any municipality or district for the period for which such modification was made shall be made in the next payment the Treasurer shall make to such municipality or district pursuant to this section. In the fiscal year commencing July 1, 2003, and in each fiscal year thereafter, the amount of the grant payable to each municipality and district in accordance with this section shall be reduced proportionately in the event that the total amount of the grants payable to all municipalities and districts exceeds the amount appropriated.

      (P.A. 78-303, S. 85, 136; 78-357, S. 9, 16; P.A. 80-267, S. 5; P.A. 83-280, S. 1, 3; P.A. 84-203, S. 1, 2; P.A. 85-371, S. 9, 10; P.A. 86-258, S. 3, 8; P.A. 87-115, S. 5, 8; P.A. 88-230, S. 1, 12; 88-287, S. 2, 5; P.A. 89-235, S. 4, 5; P.A. 90-98, S. 1, 2; 90-270, S. 18, 38; June Sp. Sess. P.A. 91-14, S. 9, 30; P.A. 93-142, S. 4, 7, 8; P.A. 95-220, S. 4-6; 95-283, S. 21, 68; P.A. 96-239, S. 14, 15, 17; 96-261, S. 3, 4; June Sp. Sess. P.A. 99-1, S. 17, 51; June Sp. Sess. P.A. 01-6, S. 55, 85; May Sp. Sess. P.A. 04-2, S. 24; P.A. 05-287, S. 14.)

      History: P.A. 78-303 allowed substitution of commissioner of revenue services for tax commissioner in P.A. 78-357 to fulfill purposes of P.A. 77-614; P.A. 80-267 made provisions applicable to all municipalities where previously they applied solely to "distressed" municipalities; P.A. 83-280 provided for grant payment to special districts and special services districts located within distressed municipalities; P.A. 84-203 changed administrative references from commissioner of revenue services to secretary of the office of policy and management, changed filing date from July first to August first and specified period for appeal; P.A. 85-371 extended deadline for review by the secretary to the following August first and inserted provisions concerning modifications after that date, effective July 1, 1985, and applicable to grant or claim information received by secretary of the office of policy and management on or after that date; P.A. 86-258 added provisions re grants in the case of certain service manufacturing facilities located in an enterprise zone; P.A. 87-115 added the provisions for forfeiture by any municipality which neglects to transmit the claim and supporting documentation as required and provided for waiver of such forfeiture in accordance with regulations to be adopted, effective May 11, 1987, and applicable to claims required to be submitted on or before August 1, 1989, and thereafter; P.A. 88-287 added provisions re payments for revenue a municipality or district would have received except for the provisions of Subdiv. (70) of Sec. 12-81, effective June 6, 1988, and applicable to assessment years of municipalities commencing on or after October 1, 1988; P.A. 89-235 amended Subdiv. (3) to make technical changes to the categories of certified manufacturing facilities located in an enterprise zone which are defined in the Standard Industrial Classification Manual, and deleted the requirement for the creation of ten or more new employment positions for such facilities; P.A. 90-270 expanded eligibility to districts located in targeted investment communities and enterprise zones and expanded the categories of activities that can be engaged in by business to include health services, fishing, hunting and trapping, motor freight transportation and warehousing, water transportation, transportation by air, transportation services, security and commodity brokers, dealers, exchanges and services; June Sp. Sess. P.A. 91-14 amended Subdiv. (1) to decrease the grant amount related to Subdivs. (59) and (60) of Sec. 12-81 from seventy-five per cent of the tax revenue otherwise payable to fifty per cent, effective September 19, 1991, and applicable to grant payments made in the fiscal year commencing July 1, 1991, and in each fiscal year thereafter; P.A. 95-283 changed location of appeal from the judicial district in which the municipality or district is located to the judicial district of Hartford-New Britain, effective October 1, 1996 (Revisor's note: P.A. 88-230, 90-98, 93-142 and 95-220 authorized substitution of "judicial district of Hartford" for "judicial district of Hartford-New Britain", effective September 1, 1998); P.A. 96-239 expanded SIC category list to include telemarketing, effective July 1, 1996; P.A. 96-261 repealed changes made by P.A. 95-283, effective June 10, 1996; June Sp. Sess. P.A. 99-1 deleted Subdiv. (3) re grants with respect to certain manufacturing facilities, and made a technical change, effective July 1, 1999; June Sp. Sess. P.A. 01-6 deleted former provisions re notice and appeal of decisions of the Secretary of the Office of Policy and Management, added provisions re appeal in accordance with Sec. 12-120b and made technical changes, effective July 1, 2001; May Sp. Sess. P.A. 04-2 made a technical change and provided for pro rata reduction of grants under section in the event the total amount due to municipalities exceeds the amount appropriated, effective May 12, 2004, and applicable to assessment years commencing on or after October 1, 2002; P.A. 05-287 changed "December first" to "December fifteenth" and changed "on or before the following December fifteenth" to "the fifth business day following December fifteenth", effective July 13, 2005.

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      Sec. 32-9t. Urban and industrial site reinvestment program. Registration of fund managers. Tax credits. (a) As used in this section:

      (1) "Commissioner" means the Commissioner of Economic and Community Development.

      (2) "Eligible industrial site investment project" means a project located within this state for the development or redevelopment of real property: (A) (i) That has been subject to a "spill", as defined in section 22a-452c, (ii) is an "establishment", as defined in subdivision (3) of section 22a-134, or (iii) is a "facility", as defined in 42 USC 9601(9); (B) that, if remediated, renovated or demolished in accordance with applicable law and regulations and the standards of remediation of the Department of Environmental Protection and used for business purposes, will add significant new economic activity and employment in the municipality in which the investment is to be made, and will generate additional tax revenues to the state; (C) for which the use of the urban and industrial site reinvestment program will be necessary to attract private investment to the project; (D) the business use of which would be economically viable and would generate direct and indirect economic benefits to the state that exceed the amount of the investment during the period for which the tax credits granted pursuant to public act 00-170* are granted; and (E) that is, in the judgment of the commissioner, consistent with the strategic economic development priorities of the state and the municipality.

      (3) "Eligible urban reinvestment project" means a project: (A) That would add significant new economic activity in the eligible municipality in which the project is located, and will generate significant additional tax revenues to the state or the municipality; (B) for which the use of the urban and industrial site reinvestment program will be necessary to attract private investment to an eligible municipality; (C) that is economically viable; (D) for which the direct and indirect economic benefits to the state outweigh the costs of the project; and (E) that is, in the judgment of the commissioner, consistent with the strategic economic development priorities of the state and the municipality.

      (4) "Related person" means: (A) A corporation, limited liability company, partnership, association or trust controlled by the taxpayer; (B) an individual, corporation, limited liability company, partnership, association or trust that is in control of the taxpayer; (C) a corporation, limited liability company, partnership, association or trust controlled by an individual, corporation, limited liability company, partnership, association or trust that is in control of the taxpayer; or (D) a member of the same controlled group as the taxpayer. For purposes of this section, "control", with respect to a corporation, means ownership, directly or indirectly, of stock possessing fifty per cent or more of the total combined voting power of all classes of the stock of such corporation entitled to vote. "Control", with respect to a trust, means ownership, directly or indirectly, of fifty per cent or more of the beneficial interest in the principal or income of such trust. The ownership of stock in a corporation, of a capital or profits interest in a partnership or association or of a beneficial interest in a trust shall be determined in accordance with the rules for constructive ownership of stock provided in Section 267(c) of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as from time to time amended, other than paragraph (3) of such section.

      (5) "Investment" means all amounts invested in an eligible project by or on behalf of a taxpayer, whether directly, through a fund, or through a community development entity including, but not limited to, (A) equity investments made by the taxpayer, and (B) loans.

      (6) "Income year" means with respect to entities subject to taxation under chapters 207 to 212a, the income year as determined under each of said chapters, as the case may be.

      (7) "Taxpayer" means any person, as defined in section 12-1, whether or not subject to any taxes levied by this state.

      (8) "Fund manager" means a fund manager registered in accordance with subsection (d) of this section.

      (9) "New job" means a job that did not exist in the business of a subject business in this state prior to the subject business' application to the commissioner for an eligibility certificate under this section for a new facility and that is filled by a new employee, but does not mean a job created when an employee is shifted from an existing location of the subject business in this state to a new facility.

      (10) "New employee" means a person hired by a subject business to fill a position for a new job or a person shifted from an existing location of the subject business outside this state to a new facility in this state, provided (A) in no case shall the total number of new employees allowed for purposes of this credit exceed the total increase in the taxpayer's employment in this state, which increase shall be the difference between (i) the number of employees employed by the subject business in this state at the time of application for an eligibility certificate to the commissioner plus the number of new employees who would be eligible for inclusion under the credit allowed under this section without regard to this calculation, and (ii) the highest number of employees employed by the subject business in this state in the year preceding the subject business' application for an eligibility certificate to the commissioner, and (B) a person shall be deemed to be a "new employee" only if such person's duties in connection with the operation of the facility are on a regular, full-time, or equivalent thereof, and permanent basis.

      (11) "New facility" means a facility which (A) is acquired by, leased to, or constructed by, a subject business on or after the date of the subject business' application to the commissioner for an eligibility certificate under this section, unless, upon application of the subject business and upon good and sufficient cause shown, the commissioner waives the requirement that such activity take place after the application, and (B) was not in service or use during the one-year period immediately prior to the date of the subject business' application to the commissioner for an eligibility certificate under this section, unless upon application of the subject business and upon good and sufficient cause shown, the commissioner consents to waiving the one-year period.

      (12) "Eligible municipality" means (A) a municipality with an area designated as an enterprise zone pursuant to section 32-70, (B) a distressed municipality, as defined in subsection (b) of section 32-9p, or (C) a municipality that has a population in excess of one hundred thousand.

      (13) "Eligible project" means an eligible urban reinvestment project or an eligible industrial site investment project or both.

      (14) "Approved investment" means an investment approved by the commissioner under subsection (g) of this section.

      (15) "Recapture amount" means the amount by which the total of tax credits claimed with respect to any approved investment as of the date of calculation exceeds the sum of all state revenue actually generated through such date by the eligible project in which such approved investment was made.

      (16) "Pro rata share" means the percentage the amount of the approved investment by an individual investor in an eligible project bears to the total amount of the approved investment in such project, or in the case of a taxpayer to whom credits are transferred under this section, the percentage the amount of credits with respect to an approved investment transferred bears to the total credits with respect to such approved investment.

      (17) "Community development entity" means any corporation, limited partnership or limited liability company qualified to do business in this state and which (A) is organized for the purpose of providing investment capital or financing for eligible projects under this section, (B) maintains accountability to residents of more than one eligible municipality through representation on the governing board of the entity, (C) is organized for the purpose of seeking certification and an allocation of new markets tax credits as provided in Section 45D of the Internal Revenue Code of 1986, or any subsequent corresponding internal revenue code of the United States, as from time to time amended, and (D) is registered in accordance with subsection (d) of this section. No community development entity shall be eligible for any tax credits under this section unless it is certified under said Section 45D on the date any approved investment is made. A community development entity shall not be deemed a "fund" for purposes of this section.

      (18) "Project" means the acquisition, leasing, demolition, remediation, construction, renovation, expansion or other development or redevelopment of real property and improvements within this state, including furniture, fixtures, equipment and other personal property which is reasonably necessary in connection therewith, and associated interest and other financing costs and charges, relocation and start-up costs, and architectural, engineering, legal and other professional services, plans, specifications, surveys, permits, studies and evaluations necessary or incident to the development, financing, completion and placing in operation of such a project.

      (b) There is established an urban and industrial site reinvestment program under which taxpayers who make investments in eligible urban reinvestment projects or eligible industrial site investment projects may be allowed a credit against the tax imposed under chapters 207 to 212a, inclusive, or section 38a-743, or a combination of said taxes, in an amount equal to the percentage of their approved investment determined in accordance with subsection (i) of this section.

      (c) No project shall be deemed an eligible project unless such project shall, in the judgment of the commissioner, be of sufficient size, by itself or in conjunction with related new investments, to generate a substantial return to the state economy.

      (d) (1) The commissioner may register managers of funds and community development entities created for the purpose of investing in eligible urban reinvestment projects and eligible industrial site investment projects. Any manager or community development entity registered under this subsection shall have its primary place of business in this state. Each applicant shall submit an application under oath to the commissioner to be registered and shall furnish evidence satisfactory to the commissioner of its financial responsibility, integrity, professional competence and experience in managing investment funds. Failure to maintain adequate fiduciary standards with respect to investments made under this section shall constitute cause for the commissioner to revoke, after hearing, any registration granted under this section or section 38a-88a. The fund manager or community development entity shall make a report on or before the first day of March in each year, under oath, to the Commissioner of Economic and Community Development and the Commissioner of Revenue Services specifying the name, address and Social Security number or employer identification number of each investor, the year during which each investment was made by each investor, the amount of each investment, a description of the fund's investment objectives and relative performance, or the entity's projects, as the case may be, and a description, including amounts, of all fees received by such manager or entity in relation to each such fund.

      (2) Any manager of funds registered on or before July 1, 2000, pursuant to section 38a-88a shall be deemed registered as a fund manager for all purposes under the provisions of this section upon submission, in writing, to the commissioner of such manager's intention to act as a manager of funds under this section. The commissioner may request from any such manager such information as the commissioner may require relating to such manager's financial responsibility, integrity, professional competence and experience in managing investment funds.

      (e) Any taxpayer or fund manager, or community development entity wishing to make an investment under the provisions of this section shall apply to the commissioner in accordance with the provisions of this section. The application shall contain sufficient information to establish that the project in which the proposed investment will be made is an eligible industrial site investment project or an urban reinvestment project, as appropriate, and information concerning the type of investment proposed to be made, the location of the project, the number of jobs to be created or retained, physical infrastructure that might be created or preserved, feasibility studies or business plans for the project, projected state and local revenue that might derive as a result of the project and other information necessary to demonstrate the financial viability of the project and to demonstrate that the investment will provide net benefits to the economy of, and employment for citizens of, the municipality and the state, and in the case of an eligible industrial site investment project, how such project will meet the standards of remediation of the Department of Environmental Protection. The commissioner shall impose a fee for such application as the commissioner deems appropriate.

      (f) (1) The commissioner shall determine whether the project in which the proposed investment is to be made is an eligible urban reinvestment project or an eligible industrial site investment project, whether the project is economically viable only with use of the urban and industrial site reinvestment program, the effects of the project on the municipality where the investment will be made, and whether the project would provide a net benefit to economic development and employment opportunities in the state and whether the project will conform to the state plan of conservation and development. The commissioner may require the applicant to submit such additional information as may be necessary to evaluate the application.

      (2) The commissioner shall prepare a revenue impact assessment that estimates the state and local revenue that would be generated as a result of the project. The commissioner shall prepare an economic feasibility study relative to such project. The commissioner may retain any such persons as the commissioner deems appropriate to conduct such revenue impact assessment or economic feasibility study.

      (g) (1) The commissioner, upon consideration of the application, the revenue impact assessment and any additional information that the commissioner requires concerning a proposed investment, may approve an investment if the commissioner concludes that the project in which such investment is to be made is an eligible urban reinvestment project or an eligible industrial site investment project. If the commissioner rejects an application, the commissioner shall specifically identify the defects in the application and specifically explain the reasons for the rejection. The commissioner shall render a decision on an application not later than ninety days from its receipt. The amount of the investment so approved shall not exceed the greater of: (A) The amount of state revenue that will be generated according to the revenue impact assessment prepared under this subsection; or (B) the total of state revenue and local revenue generated according to such assessment in the case of a manufacturing business with standard industrial classification codes of 3999, 2099, 2992 and 2834 which is relocating to a site in Connecticut from out-of-state, provided the relocation will result in new development of at least seven hundred twenty-five thousand square feet in a state-sponsored industrial park.

      (2) The approval of an investment by the commissioner may be combined with the exercise of any of the commissioner's other powers, including, but not limited to, the provision of other forms of financial assistance.

      (3) The commissioner shall require the applicant to reimburse the commissioner for all or any part of the cost of any revenue impact assessment, economic feasibility study or other activities performed in the exercise of due diligence pursuant to subsection (f) of this section.

      (4) There is established an account to be known as the "Connecticut economic impact and analysis account" which shall be a separate, nonlapsing account within the General Fund. The account shall contain any moneys required by law to be deposited in the account and shall be held separate and apart from other moneys, funds and accounts. There shall be deposited in the account any proceeds realized by the state from activities pursuant to this section. Investment earnings credited to the account shall become part of the assets of the account. Any balance remaining in the account at the end of any fiscal year shall be carried forward in the account for the next fiscal year. Amounts in the account may be used by the Department of Economic and Community Development to fund the cost of any activities of the department pursuant to this section, including administrative costs related to such activities.

      (h) Upon approving an investment, the commissioner shall issue a certificate of eligibility certifying that the applicant has complied with the provisions of this section.

      (i) (1) There shall be allowed as a credit against the tax imposed under chapters 207 to 212a, inclusive, or section 38a-743, or a combination of said taxes, an amount equal to the following percentage of approved investments made by or on behalf of a taxpayer with respect to the following income years of the taxpayer: (A) With respect to the income year in which the investment in the eligible project was made and the two next succeeding income years, zero per cent; (B) with respect to the third full income year succeeding the year in which the investment in the eligible project was made and the three next succeeding income years, ten per cent; (C) with respect to the seventh full income year succeeding the year in which the investment in the eligible project was made and the next two succeeding years, twenty per cent. The sum of all tax credits granted pursuant to the provisions of this section shall not exceed one hundred million dollars with respect to a single eligible urban reinvestment project or a single eligible industrial site investment project approved by the commissioner. The sum of all tax credits granted pursuant to the provisions of this section shall not exceed five hundred million dollars.

      (2) Notwithstanding the provisions of subdivision (1) of this subsection, any applicant may, at the time of application, apply to the commissioner for a credit that exceeds the limitations established by this subsection. The commissioner shall evaluate the benefits of such application and make recommendations to the General Assembly relating to changes in the general statutes which would be necessary to effect such application if the commissioner determines that the proposal would be of economic benefit to the state.

      (j) The credits allowed by this section may be claimed by a taxpayer who has made an investment (1) directly only if such investment has a total asset value, either alone or in conjunction with other taxpayer investments in an eligible project, of not less than five million dollars or, in the case of an investment in an eligible project for the preservation of an historic facility and redevelopment of the facility for mixed uses that includes at least four housing units, a total asset value of not less than two million dollars; (2) through a fund managed by a fund manager registered under this section only if such fund: (A) Has a total asset value of not less than sixty million dollars for the income year for which the initial credit is taken; and (B) has not less than three investors who are not related persons with respect to each other or to any person in which any investment is made other than through the fund at the date the investment is made; or (3) through a community development entity.

      (k) Each taxpayer claiming the credit allowed under this section shall submit to the Commissioner of Revenue Services a copy of the eligibility certificate issued under subsection (h) of this section with its tax return for each taxable year for which a credit is claimed.

      (l) The tax credit allowed by this section, when made through a fund, shall only be available for investments in funds that are not open to additional investments or investors beyond the amount subscribed at the formation of the fund.

      (m) (1) The Commissioner of Revenue Services may treat one or more corporations that are properly included in a combined corporation business tax return under section 12-223a as one taxpayer in determining whether the appropriate requirements under this section are met. Where corporations are treated as one taxpayer for purposes of this subsection, then the credit shall be allowed only against the amount of the combined tax for all corporations properly included in a combined return that, under the provisions of subdivision (2) of this subsection, is attributable to the corporations treated as one taxpayer.

      (2) The amount of the combined tax for all corporations properly included in a combined corporation business tax return that is attributable to the corporations that are treated as one taxpayer under the provisions of this subsection shall be in the same ratio to such combined tax that the net income apportioned to this state of each corporation treated as one taxpayer bears to the net income apportioned to this state, in the aggregate, of all corporations included in such combined return. Solely for the purposes of computing such ratio, any net loss apportioned to this state by a corporation treated as one taxpayer or by a corporation included in such combined return shall be disregarded.

      (n) Any taxpayer allowed a credit under this section may assign such credit to another taxpayer or taxpayers, provided such other taxpayer or taxpayers may claim such credit only with respect to a taxable year for which the assigning taxpayer would have been eligible to claim such credit and such other taxpayer or taxpayers may not further assign such credit. The taxpayer or taxpayers allowed such credit, the fund manager or the community development entity shall file with the Commissioner of Revenue Services information requested by the commissioner regarding such assignments, including, but not limited to, the current holders of credits as of the end of the preceding calendar year.

      (o) No taxpayer shall be eligible for a credit under (1) this section, and (2) section 12-217e or 38a-88a, for the same investment. No two taxpayers shall be eligible for any tax credit with respect to the same investment or the same project costs.

      (p) Any credit not used in the income year for which it was allowed may be carried forward for the five immediately succeeding income years until the full credit has been allowed.

      (q) Any tax credits approved under this section that would constitute in excess of twenty million dollars in total for a single investment shall be submitted by the Commissioner of Economic and Community Development to the joint standing committee of the General Assembly having cognizance of matters relating to finance prior to the issuance of a certificate of eligibility for such investment. Said commissioner shall make a recommendation to the president pro tempore of the Senate and to the speaker of the House of Representatives regarding approval or disapproval of such project not later than thirty days after receiving such submission. If such submission is not disapproved by the House of Representatives or the Senate, or both, within sixty days of the submission date, the commissioner may issue such certificate.

      (r) Not later than July first in each year that credits allowed by this section are claimed by a taxpayer with respect to an approved investment, the commissioner may retain such persons as said commissioner may deem appropriate to conduct a study to estimate the state revenue that is being and will be generated by the eligible project in which such investment is made. Such economic impact study shall determine whether the state revenue actually generated by such eligible project is equal to the estimate of state revenue made at the time the investment in such eligible project was approved. If the sum of all state revenue actually generated by such eligible project is less than the amount of the total sum of tax credits claimed with respect to the approved investment in such project on the date of such analysis, the commissioner may determine from the person retained pursuant to this subsection the applicable recapture amount and may revoke the certificate of eligibility issued under subsection (h) of this section. The commissioner may require the taxpayer, the fund manager or community development entity that made such approved investment to reimburse the commissioner for all or any part of the cost of any economic impact study performed under this subsection.

      (s) (1) Any taxpayer which has claimed credits allowed by this section related to an investment concerning which the commissioner has revoked the certificate of eligibility issued under subsection (h) of this section, shall be required to recapture such taxpayer's pro rata share of the recapture amount as determined under the provisions of subdivision (2) of this subsection and no subsequent credit shall be allowed unless such certificate of eligibility is reinstated under the provisions of subdivision (3) of this subsection.

      (2) If the taxpayer is required under the provisions of subdivision (1) of this subsection to recapture its pro rata share of the recapture amount during (A) the first year such credit was claimed, then ninety per cent of such share shall be recaptured on the tax return required to be filed for such year, (B) the second of such years, then sixty-five per cent of such share shall be recaptured on the tax return required to be filed for such year, (C) the third of such years, then fifty per cent of such share shall be recaptured on the tax return required to be filed for such year, (D) the fourth of such years, then thirty per cent of such share shall be recaptured on the tax return required to be filed for such year, (E) the fifth of such years, then twenty per cent of such share shall be recaptured on the tax return required to be filed for such year, and (F) the sixth or subsequent of such years, then ten per cent of such share shall be recaptured on the tax return required to be filed for such year. The Commissioner of Revenue Services may recapture such share from the taxpayer who has claimed such credits. If the commissioner is unable to recapture all or part of such share from such taxpayer, the commissioner may seek to recapture such share from any taxpayer who has assigned credits in an amount at least equal to such share to another taxpayer. If the commissioner is unable to recapture all or part of such share from any such taxpayer, the commissioner may recapture such share from any fund through which the investment was made.

      (3) If the commissioner has revoked the certificate of eligibility issued under subsection (h) of this section, such certificate of eligibility shall be reinstated by the commissioner if, upon a request made by the taxpayer, fund manager or community development entity who made such approved investment, an economic impact study conducted pursuant to subsection (r) of this section shall determine that the sum of all state revenue actually generated by the project in which such investment was made is greater than the amount of the total sum of tax credits claimed on the date of such analysis, provided no such request shall be made pursuant to this subsection during the calendar year in which such certificate was revoked. For the purpose of determining whether such certificate shall be reinstated, the commissioner shall, upon receipt of a request made under this subsection, obtain one such economic impact study per calendar year and may obtain additional such economic impact studies as the commissioner deems appropriate.

      (P.A. 00-170, S. 38, 42; June Sp. Sess. P.A. 01-9, S. 122, 131; June 30 Sp. Sess. P.A. 03-6, S. 77; P.A. 04-20, S. 6; P.A. 05-276, S. 2, 3.)

      *Public act 00-170 is entitled "An Act Concerning Reduction of Various Taxes and Fees, Sunset of Certain Insurance Reinvestment Funds, Crediting of Interest on the Attorneys' Client Security Fund, a Tax on Snuff Tobacco Products, Funds for the Fisheries Account, Incentives for Urban Site Reinvestment and Use of the Tobacco Settlement Fund". (See Reference Table captioned "Public Acts of 2000" in Volume 16 which lists the sections amended, created or repealed by the act).

      History: P.A. 00-170 effective July 1, 2000 (Revisor's note: In Subsec. (e), a period was inserted editorially by the Revisors before "The commissioner shall"); June Sp. Sess. P.A. 01-9 amended Subsec. (a) to redefine "eligible industrial site investment project" in Subdiv. (2), "eligible urban reinvestment project" in Subdiv. (3), "investment" in Subdiv. (5), "recapture amount" in Subdiv. (15), and "pro rata share" in Subdiv. (16), define "community development entity" and "project" in new Subdivs. (17) and (18) and make a technical change in Subdiv. (14), amended Subsec. (b) to change "invest" to "make investments" and add reference to "approved" investment, and added provisions re community development entity, changed "investment" to "project" and made conforming and technical changes in Subsec. (d) to (g), (i), (j), (n), (o), (r) and (s), effective July 1, 2001; June 30 Sp. Sess. P.A. 03-6 amended Subsec. (g) by, in Subdiv. (1), adding "greater of:", designating existing maximum investment amount as Subpara. (A) and adding Subpara. (B) re total revenue generated in case of manufacturing business with standard industrial classification codes of 3999, 2099, 2992 and 3834, by adding provision in Subdiv. (3) re other activities performed in the exercise of due diligence and deleting "used in reviewing the application", and by adding new Subdiv. (4) re Connecticut economic impact and analysis account, effective August 20, 2003; P.A. 04-20 made a technical change in Subsec. (g)(3), effective April 16, 2004; P.A. 05-276 amended Subsec. (j)(1) by inserting ", either alone or in conjunction with other taxpayer investments in an eligible project,", reducing the investment threshold for credits from twenty million to five million dollars and further reducing such threshold to two million dollars for an eligible project for preservation of an historic facility and redevelopment of the facility for certain mixed uses, and amended Subsec. (n) by adding "or taxpayers", effective July 13, 2005.

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      Sec. 32-9qq. Business outreach center challenge grants. Eligibility of greenways projects. (a) It is hereby found and declared as a matter of legislative determination that there is a continuing need in the state for stimulation and encouragement of economic growth and development within the state through the establishment of business outreach centers located in certain regions of the state or for certain industry sectors to assist in providing services to small businesses and minority business enterprises as defined in section 4a-60g in the areas of business plan development, financial projection and planning, loan packaging, business counseling and related follow-up services, including the monitoring of any of the foregoing.

      (b) The business outreach center challenge grant program is hereby created. In order to stimulate and encourage economic growth and development, the state, acting through the Department of Economic and Community Development, may make grants for the establishment of business outreach centers located in certain regions of the state or for certain industry sectors to assist in providing services to small businesses and minority business enterprises. Such grants shall be made under such terms and conditions as the department deems appropriate and shall be payable from the proceeds of the sale of bonds authorized under subsection (f) of this section and funds received by the department from any other source, in accordance with the following provisions:

      (1) A business outreach center shall be any nonprofit or governmental entity providing or able to provide assistance to small businesses and minority business enterprises in the areas of business plan development, financial projection, loan package planning, including loan packaging for small businesses and minority business enterprises which are seeking financial assistance from the Connecticut Development Authority, business counseling and related monitoring and follow-up services.

      (2) The department may require any entity receiving a grant pursuant to this section to obtain a matching grant in such amount as the department determines in its discretion. Such matching grant may include cash and in-kind contributions.

      (c) Grants may be made under this section to municipalities and other organizations for the purpose of providing funds to develop greenways, including, but not limited to, transportation-related greenways supported by the federal Transportation Equity Act for the 21st Century, as amended from time to time. The amount of any grant shall be as follows: (1) For transportation greenways projects that are part of interstate greenways, not more than twenty per cent of the project cost; (2) for transportation greenways projects that are local spurs from interstate greenways or that are intertown greenways projects, not more than ten per cent of the project cost; and (3) for greenways that are not transportation greenways, not more than half of the capital costs of the project.

      (d) Applications for grants under this section shall be submitted on forms provided by the department. When reviewing applications, the department shall consider such factors as the impact on certain regions of the state or certain industry sectors, the applicant's plan for outreach efforts designed to inform small businesses and minority business enterprises of available sources of financial and technical assistance and the commitment and capacity of the applicant to provide assistance to small businesses and minority business enterprises under this section.

      (e) Each grant made under this section shall be authorized pursuant to regulations adopted by the Department of Economic and Community Development in accordance with the provisions of chapter 54, which regulations may include, but shall not be limited to, provisions concerning application requirements, grant amounts and eligible use of funds, provided the amount of any grant under subsection (b) of this section shall be not more than the amount specified in said subsection.

      (f) For the purposes of this section, the State Bond Commission shall have the power, from time to time, to authorize the issuance of bonds of the state in one or more series and in principal amounts not exceeding in the aggregate two million five hundred thousand dollars. The proceeds of the sale of said bonds shall be used by the Department of Economic and Community Development for grants under the business outreach center challenge grant program created under this section. All provisions of section 3-20 or the exercise of any right or power granted thereby which are not inconsistent with the provisions of this section are hereby adopted and shall apply to all bonds authorized by the State Bond Commission pursuant to this section, and temporary notes in anticipation of the money to be derived from the sale of any such bonds so authorized may be issued in accordance with said section 3-20 and from time to time renewed. Said bonds shall mature at such time or times not exceeding twenty years from their respective dates as may be provided in or pursuant to the resolution or resolutions of the State Bond Commission authorizing such bonds. None of such bonds shall be authorized except upon a finding by the State Bond Commission that there has been filed with it a request for such authorization, which is signed by or on behalf of the Secretary of the Office of Policy and Management and states such terms and conditions as said commission in its discretion may require. Said bonds issued pursuant to this section shall be general obligations of the state and the full faith and credit of the state of Connecticut are pledged for the payment of the principal of and interest on said bonds as the same become due, and accordingly and as part of the contract of the state with the holders of said bonds, appropriation of all amounts necessary for punctual payment of such principal and interest is hereby made, and the Treasurer shall pay such principal and interest as the same become due. Net earnings on investments or reinvestments of proceeds, accrued interest and premiums on the issuance of such bonds, after payment therefrom of expenses incurred by the Treasurer or State Bond Commission in connection with their issuance, shall become part of the business outreach center challenge grant program.

      (P.A. 88-265, S. 28, 36; P.A. 89-119, S. 2, 4; P.A. 95-250, S. 1; 95-335, S. 5, 26; P.A. 96-211, S. 1, 5, 6; P.A. 00-148, S. 18; P.A. 05-288, S. 140.)

      History: P.A. 89-119 made technical change to Subsec. (b); P.A. 95-250 and P.A. 96-211 replaced Commissioner and Department of Economic Development with Commissioner and Department of Economic and Community Development; P.A. 95-335 inserted new Subsec. (c) making greenways projects eligible for grants and relettered the remaining Subsecs., effective July 1, 1995; P.A. 00-148 amended Subsec. (c) by changing "Intermodal Surface Transportation Efficiency Act of 1991" to "Transportation Equity Act for the 21st Century"; P.A. 05-288 made a technical change in Subsec. (e), effective July 13, 2005.

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      Sec. 32-9uu. Program to increase entrepreneurial potential in the inner cities. The Commissioner of Economic and Community Development may establish, within available appropriations, a program to increase the entrepreneurial potential in the inner cities and provide successful role models that will further demonstrate to students and residents the value of market-based strategies to increase wealth and income.

      (P.A. 05-276, S. 4.)

      History: P.A. 05-276 effective July 13, 2005.

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