S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  2817

                       2009-2010 Regular Sessions

                          I N  A S S E M B L Y

                            January 21, 2009
                               ___________

Introduced  by  M.  of  A.  SCHIMMINGER,  ESPAILLAT,  TOWNS, DelMONTE --
  Multi-Sponsored by -- M. of A. COLTON, KOLB -- read once and  referred
  to the Committee on Ways and Means

AN  ACT  to  amend  the tax law, in relation to providing banking corpo-
  rations with a tax credit for investment  in  certified  bank  capital
  companies

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Statement of  legislative  intent.  The  legislature  finds
that, in order to promote the growth of the state economy, a need exists
to  further encourage the investment of private financial resources into
the state's venture capital markets.  This  act  creates  incentives  to
increase  investment  by banking corporations into venture capital funds
which invest in viable small  business  enterprises  which  have  tradi-
tionally  experienced  difficulty  in  attracting  institutional venture
capital. In addition, this act promotes the formation and  expansion  of
new  and existing businesses, creating jobs, and resulting in the expan-
sion of the state's economy.
  S 2. Section 1456 of the tax law is amended by adding a new subsection
(u) to read as follows:
  (U) CREDIT FOR CERTAIN INVESTMENTS IN CERTIFIED  BANK  CAPITAL  COMPA-
NIES.  (1) A TAXPAYER SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS HERE-
INAFTER PROVIDED, AGAINST THE TAX IMPOSED BY THIS ARTICLE. THE AMOUNT OF
THE CREDIT SHALL BE EQUAL TO ONE HUNDRED PERCENT  OF  AN  INVESTMENT  OF
CERTIFIED  BANK  CAPITAL MADE BY THE TAXPAYER PURSUANT TO SECTION THIRTY
OF THIS CHAPTER.
  (2) TEN PERCENT OF SUCH CREDIT SHALL BE ALLOWED IN THE TAXABLE YEAR TO
WHICH SUCH INVESTMENT  IS  ALLOCATED  PURSUANT  TO  SUBDIVISION  (J)  OF
SECTION THIRTY OF THIS CHAPTER AND IN EACH OF THE NINE FOLLOWING TAXABLE
YEARS.  IN  ADDITION, IN ANY TAXABLE YEAR SUBSEQUENT TO THE TAXABLE YEAR
FOR WHICH SUCH INVESTMENT IS SO ALLOCATED, ANY  AMOUNT  CARRIED  FORWARD

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD03974-01-9
              

A. 2817                             2

UNDER  PARAGRAPHS  THREE  AND  FOUR  OF  THIS  SUBSECTION MAY BE CARRIED
FORWARD INDEFINITELY UNTIL SUCH CREDITS ARE UTILIZED.
  (3)  NO  CREDIT ALLOWABLE PURSUANT TO THIS SUBSECTION SHALL REDUCE THE
TAX PAYABLE UNDER THIS  ARTICLE  TO  LESS  THAN  THE  MINIMUM  FIXED  BY
SUBSECTION  (B)  OF SECTION FOURTEEN HUNDRED FIFTY-FIVE OF THIS ARTICLE.
IF, HOWEVER, THE AMOUNT OF CREDIT ALLOWABLE UNDER  THIS  SUBSECTION  FOR
ANY  TAXABLE  YEAR  REDUCES THE TAX TO SUCH AMOUNT, ANY AMOUNT OF CREDIT
NOT TAKEN IN SUCH TAXABLE YEAR MAY BE CARRIED OVER TO THE FOLLOWING YEAR
OR YEARS AND MAY BE DEDUCTED FROM THE TAXPAYER'S TAX FOR  SUCH  YEAR  OR
YEARS.
  (4)  IF  FOR ANY TAXABLE YEAR THE CREDIT ALLOWABLE UNDER PARAGRAPH TWO
OF THIS SUBSECTION EXCEEDS SUCH MINIMUM TAX FOR SUCH TAXABLE YEAR,  THEN
THE AMOUNT BY WHICH SUCH CREDIT EXCEEDS SUCH MINIMUM TAX LIABILITY SHALL
BE CARRIED FORWARD AS A CREDIT UNDER PARAGRAPH TWO OF THIS SUBSECTION TO
THE  FOLLOWING YEAR OR YEARS AND MAY BE DEDUCTED FROM THE TAXPAYER'S TAX
FOR SUCH YEAR OR YEARS.
  (5) DECERTIFICATION OF A CERTIFIED BANK CAPITAL COMPANY  REQUIRES  THE
DISALLOWANCE AND THE RECAPTURE OF THE CREDIT ALLOWED UNDER PARAGRAPH ONE
OF THIS SUBSECTION, AS FOLLOWS:
  (A)  DECERTIFICATION  OF  A  CERTIFIED BANK CAPITAL COMPANY WITHIN TWO
YEARS OF ITS CERTIFICATION DATE AND PRIOR TO ITS  MEETING  THE  REQUIRE-
MENTS OF SUBPARAGRAPH (A) OF PARAGRAPH ONE OF SUBDIVISION (C) OF SECTION
THIRTY  OF  THIS CHAPTER SHALL CAUSE DISALLOWANCE OF ONE HUNDRED PERCENT
OF THE CREDIT ALLOWED UNDER PARAGRAPH ONE OF  THIS  SUBSECTION  AND  THE
RECAPTURE OF ANY PORTION OF SUCH CREDIT THAT WAS PREVIOUSLY TAKEN.
  (B)  DECERTIFICATION OF A CERTIFIED BANK CAPITAL COMPANY WHICH, HAVING
MET ALL REQUIREMENTS OF SUBPARAGRAPH (A) OF PARAGRAPH ONE OF SUBDIVISION
(C) OF SECTION THIRTY OF THIS CHAPTER, SUBSEQUENTLY FAILS  TO  MEET  THE
REQUIREMENTS FOR CONTINUED CERTIFICATION UNDER THE PROVISIONS OF SUBPAR-
AGRAPH   (B)   OF  SUCH  PARAGRAPH  ONE  REQUIRES  THE  DISALLOWANCE  OF
EIGHTY-FIVE PERCENT OF THE CREDIT ALLOWED UNDER PARAGRAPH  ONE  OF  THIS
SUBSECTION  AND THE RECAPTURE OF ANY PORTION OF SUCH CREDIT IN EXCESS OF
FIFTEEN PERCENT THAT WAS PREVIOUSLY TAKEN.
  (C) DECERTIFICATION OF A CERTIFIED BANK CAPITAL COMPANY WHICH,  HAVING
MET  ALL  REQUIREMENTS  OF SUBPARAGRAPHS (A) AND (B) OF PARAGRAPH ONE OF
SUBDIVISION (C) OF SECTION THIRTY OF THIS CHAPTER, SUBSEQUENTLY FAILS TO
MEET THE REQUIREMENTS FOR CONTINUED CERTIFICATION UNDER  THE  PROVISIONS
OF  SUBPARAGRAPH  (C) OF SUCH PARAGRAPH ONE REQUIRES THE DISALLOWANCE OF
SEVENTY PERCENT OF THE  CREDIT  ALLOWED  UNDER  PARAGRAPH  ONE  OF  THIS
SUBSECTION  AND THE RECAPTURE OF ANY PORTION OF SUCH CREDIT IN EXCESS OF
THIRTY PERCENT THAT WAS PREVIOUSLY TAKEN.
  (D) DECERTIFICATION OF A CERTIFIED BANK CAPITAL  COMPANY  PURSUANT  TO
PARAGRAPH  TWO  OF  SUBDIVISION  (E)  OF SECTION THIRTY OF THIS CHAPTER,
OTHER THAN ON THE GROUNDS OF THE FAILURE OF SUCH CERTIFIED BANK  CAPITAL
COMPANY  TO  MEET  THE  REQUIREMENTS OF SUBPARAGRAPH (A), (B), OR (C) OF
PARAGRAPH ONE OF SUBDIVISION (C) OF SUCH SECTION, DOES NOT  REQUIRE  THE
DISALLOWANCE  OF  ANY OF THE CREDITS ALLOWED UNDER PARAGRAPH ONE OF THIS
SUBSECTION NOR THE RECAPTURE OF ANY PORTION OF  SUCH  CREDITS  THAT  WAS
PREVIOUSLY TAKEN.
  (6) REVOCATION OF CERTIFICATION PURSUANT TO SUBDIVISION (F) OF SECTION
THIRTY OF THIS CHAPTER, BEFORE THE LATER OF (A) THE THIRD ANNIVERSARY OF
THE  CERTIFICATION OF THE CERTIFIED BANK CAPITAL COMPANY OR (B) THE DATE
ON WHICH THE CERTIFIED BANK CAPITAL COMPANY SATISFIES  THE  REQUIREMENTS
OF SUBPARAGRAPH (C) OF PARAGRAPH ONE OF SUBDIVISION (C) OF SECTION THIR-
TY  OF THIS CHAPTER, REQUIRES DISALLOWANCE OF ONE HUNDRED PERCENT OF THE

A. 2817                             3

CREDIT ALLOWED UNDER PARAGRAPH ONE OF THIS SUBSECTION AND THE  RECAPTURE
OF ANY PORTION OF SUCH CREDIT THAT WAS PREVIOUSLY TAKEN.
  (7)  NO  CREDIT SHALL BE ALLOWED IN ANY TAX YEAR IN WHICH THE TAXPAYER
IS, INDIVIDUALLY OR WITH OR THROUGH ONE OR MORE AFFILIATES,  A  MANAGING
GENERAL  PARTNER  OF, OR EITHER UNDERWRITES OR CONTROLS THE DIRECTION OF
INVESTMENTS OF, A CERTIFIED BANK CAPITAL COMPANY FOR  WHICH  THE  CREDIT
WAS ALLOWED UNDER PARAGRAPH ONE OF THIS SUBSECTION. THIS PROVISION SHALL
NOT  PRECLUDE A CERTIFIED BANK INVESTOR OR ANY OTHER PARTY FROM EXERCIS-
ING ITS LEGAL RIGHTS AND REMEDIES (WHICH MAY INCLUDE INTERIM  MANAGEMENT
OF  A CERTIFIED BANK CAPITAL COMPANY) IN THE EVENT THAT A CERTIFIED BANK
CAPITAL COMPANY IS IN  DEFAULT  OF  ITS  STATUTORY  OBLIGATIONS  OR  ITS
CONTRACTUAL  OBLIGATIONS TO SUCH CERTIFIED BANK INVESTOR OR OTHER PARTY.
FOR PURPOSES OF THIS PARAGRAPH, "AFFILIATE" MEANS A BUSINESS  ENTITY  IN
WHICH THE TAXPAYER HOLDS AT LEAST A TEN PERCENT BENEFICIAL INTEREST.
  S  3.  The  tax  law  is amended by adding a new section 30 to read as
follows:
  S 30. CERTIFIED BANK  CAPITAL  COMPANIES.  (A)  DEFINITIONS.  FOR  THE
PURPOSE  OF  THIS SECTION AND SUBSECTION (U) OF SECTION FOURTEEN HUNDRED
FIFTY-SIX OF THIS CHAPTER, THE FOLLOWING TERMS SHALL HAVE THE  FOLLOWING
MEANINGS:
  (1)  "CERTIFICATION  DATE"  MEANS  THE  DATE ON WHICH A CERTIFIED BANK
CAPITAL COMPANY IS SO DESIGNATED BY THE DEPARTMENT.
  (2) "CERTIFIED BANK CAPITAL" MEANS AN INVESTMENT OF CASH BY  A  CERTI-
FIED BANK INVESTOR IN A CERTIFIED BANK CAPITAL COMPANY WHICH FULLY FUNDS
THE  PURCHASE  PRICE OF EITHER OR BOTH ITS EQUITY INTEREST IN THE CERTI-
FIED BANK CAPITAL COMPANY OR A QUALIFIED DEBT INSTRUMENT ISSUED  BY  THE
CERTIFIED BANK CAPITAL COMPANY.
  (3) "CERTIFIED BANK CAPITAL COMPANY" MEANS A PARTNERSHIP, CORPORATION,
TRUST,  OR  LIMITED  LIABILITY  COMPANY, ORGANIZED ON A FOR-PROFIT BASIS
THAT IS LOCATED, HEADQUARTERED, AND LICENSED OR  REGISTERED  TO  CONDUCT
BUSINESS  IN  NEW  YORK,  THAT  HAS AS ITS PRIMARY BUSINESS ACTIVITY THE
INVESTMENT OF CASH IN QUALIFIED BUSINESSES, AND THAT IS CERTIFIED BY THE
DEPARTMENT AS MEETING THE CRITERIA SET FORTH IN SUBDIVISION (B) OF  THIS
SECTION.
  (4)  "CERTIFIED  BANK  INVESTOR" MEANS ANY BANKING CORPORATION DEFINED
PURSUANT TO SECTION FOURTEEN HUNDRED  FIFTY-TWO  OF  THIS  CHAPTER  THAT
CONTRIBUTES CERTIFIED BANK CAPITAL.
  (5) "DEPARTMENT" MEANS THE BANKING DEPARTMENT.
  (6)  "QUALIFIED  BUSINESS"  MEANS  AN INDEPENDENTLY OWNED AND OPERATED
BUSINESS THAT MEETS ALL OF THE FOLLOWING CONDITIONS AS OF  THE  TIME  OF
THE FIRST INVESTMENT IN THE BUSINESS:
  (A)  IT IS HEADQUARTERED IN NEW YORK STATE, AND ITS PRINCIPAL BUSINESS
OPERATIONS ARE LOCATED IN NEW YORK STATE, AND THE  QUALIFIED  INVESTMENT
IT  RECEIVES  IS  USED  SOLELY TO SUPPORT ITS BUSINESS OPERATIONS IN THE
STATE, EXCEPT FOR ADVERTISING, PROMOTIONS, AND SALES PURPOSES. IN  CASES
WHERE THE QUALIFIED INVESTMENT IS MADE IN A START-UP COMPANY, SUCH CAPI-
TAL MUST BE USED SOLELY TO ESTABLISH AND SUPPORT ITS BUSINESS OPERATIONS
IN  NEW  YORK  STATE,  EXCEPT  FOR  ADVERTISING,  PROMOTIONS,  AND SALES
PURPOSES.
  (B) IT HAS EITHER (I) NO MORE THAN ONE  HUNDRED  EMPLOYEES,  AT  LEAST
EIGHTY  PERCENT  OF WHOM ARE EMPLOYED IN NEW YORK STATE, OR (II) NO MORE
THAN TWO HUNDRED EMPLOYEES, AT LEAST EIGHTY PERCENT OF WHOM ARE EMPLOYED
IN THIS STATE, AND DURING THE  FISCAL  YEAR  IMMEDIATELY  PRECEDING  THE
QUALIFIED INVESTMENT IT HAD, TOGETHER WITH  ITS AFFILIATES, GROSS REVEN-
UES  OF  NO  MORE THAN FIVE MILLION DOLLARS, ON A CONSOLIDATED BASIS, AS
DETERMINED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES.

A. 2817                             4

  (C) IT IS INVOLVED IN COMMERCE FOR THE PURPOSE OF DEVELOPING AND MANU-
FACTURING PRODUCTS AND SYSTEMS, INCLUDING BUT NOT LIMITED TO HIGH  TECH-
NOLOGY  PRODUCTS  AND  SYSTEMS  SUCH  AS  COMPUTERS,  COMPUTER SOFTWARE,
MEDICAL  EQUIPMENT,  BIOTECHNOLOGY,  TELECOMMUNICATIONS  EQUIPMENT   AND
PRODUCTS,  PROCESSING  OR  ASSEMBLING  ALL TYPES OF PRODUCTS, CONDUCTING
RESEARCH  AND  DEVELOPMENT  ON  ALL  TYPES  OF  PRODUCTS,  OR  PROVIDING
SERVICES, BUT EXCLUDING REAL ESTATE, REAL ESTATE DEVELOPMENT, INSURANCE,
AND  BUSINESSES  PREDOMINATELY ENGAGED IN PROFESSIONAL SERVICES PROVIDED
BY ACCOUNTANTS, LAWYERS, OR PHYSICIANS.
  (7) "QUALIFIED DEBT INSTRUMENT" MEANS A DEBT INSTRUMENT  ISSUED  BY  A
CERTIFIED  BANK  CAPITAL  COMPANY,  AT  PAR  VALUE OR A PREMIUM, WITH AN
ORIGINAL MATURITY DATE OF AT LEAST FIVE YEARS FROM DATE OF  ISSUANCE,  A
REPAYMENT  SCHEDULE  WHICH  IS NOT FASTER THAN A LEVEL PRINCIPAL AMORTI-
ZATION, AND INTEREST, DISTRIBUTION, OR PAYMENT FEATURES  WHICH  ARE  NOT
RELATED  TO  THE  PROFITABILITY OF THE CERTIFIED BANK CAPITAL COMPANY OR
THE PERFORMANCE OF THE CERTIFIED BANK CAPITAL COMPANY'S INVESTMENT PORT-
FOLIO.
  (8) "QUALIFIED DISTRIBUTION" MEANS  ANY  DISTRIBUTION  OR  PAYMENT  TO
EQUITY  HOLDERS  OF  A CERTIFIED BANK CAPITAL COMPANY IN CONNECTION WITH
THE FOLLOWING:
  (A) REASONABLE COSTS AND EXPENSES OF SUCH EQUITY HOLDERS  INCURRED  BY
SUCH  EQUITY  HOLDERS IN CONNECTION WITH FORMING, SYNDICATING, MANAGING,
AND OPERATING THE CERTIFIED BANK CAPITAL COMPANY,  INCLUDING  AN  ANNUAL
MANAGEMENT  FEE  IN  AN  AMOUNT  THAT  DOES  NOT EXCEED TWO AND ONE-HALF
PERCENT OF THE CERTIFIED BANK CAPITAL  OF  THE  CERTIFIED  BANK  CAPITAL
COMPANY,  PLUS  REASONABLE  AND  NECESSARY  FEES  PAID  FOR PROFESSIONAL
SERVICES (SUCH AS LEGAL AND ACCOUNTING SERVICES) RELATED TO  THE  OPERA-
TION OF THE CERTIFIED BANK CAPITAL COMPANY; AND
  (B)  ANY  INCREASE  OR PROJECTED   INCREASE IN FEDERAL OR STATE TAXES,
INCLUDING PENALTIES AND INTEREST RELATED TO  STATE  AND  FEDERAL  INCOME
TAXES,  OF THE EQUITY OWNERS OF A CERTIFIED BANK CAPITAL COMPANY RESULT-
ING FROM THE EARNINGS OR OTHER TAX LIABILITY OF THE CERTIFIED BANK CAPI-
TAL COMPANY, TO THE EXTENT THAT THE INCREASE IS RELATED  TO  THE  OWNER-
SHIP, MANAGEMENT, OR OPERATION OF A CERTIFIED BANK CAPITAL COMPANY.
  (9) "QUALIFIED INVESTMENT" MEANS THE INVESTMENT OF CASH BY A CERTIFIED
BANK  CAPITAL  COMPANY  IN  A QUALIFIED BUSINESS FOR THE PURCHASE OF ANY
DEBT, EQUITY, OR HYBRID SECURITY, OF ANY NATURE AND DESCRIPTION  WHATEV-
ER,  INCLUDING  A  DEBT  INSTRUMENT OR SECURITY WHICH HAS THE CHARACTER-
ISTICS OF DEBT BUT WHICH PROVIDES FOR CONVERSION INTO EQUITY  OR  EQUITY
PARTICIPATION INSTRUMENTS SUCH AS OPTIONS OR WARRANTS.
  (10)  "EARLY  STAGE  BUSINESS"  MEANS  A  QUALIFIED  BUSINESS WHICH IS
INVOLVED, AT THE TIME OF INVESTMENT, IN ACTIVITIES RELATED TO THE DEVEL-
OPMENT OF INITIAL PRODUCT OR SERVICE OFFERINGS, SUCH AS PROTOTYPE DEVEL-
OPMENT OR ESTABLISHMENT OF INITIAL PRODUCTION OR SERVICE  PROCESSES,  OR
WHICH  IS LESS THAN TWO YEARS OLD AND DURING THE FISCAL YEAR IMMEDIATELY
PRECEDING THE QUALIFIED INVESTMENT HAD, TOGETHER  WITH  ITS  AFFILIATES,
GROSS  REVENUES  OF  NO MORE THAN TWO MILLION DOLLARS, ON A CONSOLIDATED
BASIS, AS DETERMINED IN ACCORDANCE WITH  GENERALLY  ACCEPTED  ACCOUNTING
PRINCIPLES.
  (11) "SUPERINTENDENT" MEANS THE SUPERINTENDENT OF BANKS.
  (B)  CERTIFICATION.  (1) THE SUPERINTENDENT SHALL ESTABLISH BY RULE OR
REGULATION THE PROCEDURES FOR MAKING AN APPLICATION TO BECOME  A  CERTI-
FIED  BANK  CAPITAL  COMPANY.  THE  APPLICANT SHALL PAY A NON-REFUNDABLE
APPLICATION FEE OF FIVE HUNDRED DOLLARS AT THE TIME OF FILING THE APPLI-
CATION WITH THE DEPARTMENT.

A. 2817                             5

  (2) THE SUPERINTENDENT MAY CERTIFY PARTNERSHIPS, CORPORATIONS, TRUSTS,
OR LIMITED LIABILITY COMPANIES, ORGANIZED ON A FOR PROFIT  BASIS,  WHICH
SUBMIT  AN  APPLICATION  TO  BE  DESIGNATED  AS A CERTIFIED BANK CAPITAL
COMPANY IF SUCH APPLICANT IS LOCATED,  HEADQUARTERED,  AND  LICENSED  OR
REGISTERED  TO CONDUCT BUSINESS IN NEW YORK, HAS AS ITS PRIMARY BUSINESS
ACTIVITY THE INVESTMENT OF CASH IN QUALIFIED BUSINESSES, AND  MEETS  THE
OTHER CRITERIA SET FORTH IN THIS SUBDIVISION.
  (3)  A CERTIFIED BANK CAPITAL COMPANY'S INITIAL CAPITALIZATION, AT THE
TIME OF SEEKING CERTIFICATION, MUST BE FIVE HUNDRED THOUSAND DOLLARS  OR
MORE.
  (4)  THE  SUPERINTENDENT  SHALL REVIEW THE ORGANIZATIONAL DOCUMENTS OF
EACH APPLICANT FOR CERTIFICATION AND THE BUSINESS HISTORY OF THE  APPLI-
CANT,  DETERMINE  THAT  THE APPLICANT'S CASH, MARKETABLE SECURITIES, AND
OTHER LIQUID ASSETS ARE AT LEAST  FIVE  HUNDRED  THOUSAND  DOLLARS,  AND
DETERMINE  THAT  THE  OFFICERS AND THE BOARD OF DIRECTORS, GENERAL PART-
NERS, TRUSTEES, MANAGERS, OR MEMBERS ARE TRUSTWORTHY AND ARE  THOROUGHLY
ACQUAINTED WITH THE REQUIREMENTS OF THIS SUBDIVISION.
  (5)  THE  SUPERINTENDENT  SHALL VERIFY THAT AT LEAST TWO PRINCIPALS OF
THE CERTIFIED BANK CAPITAL COMPANY OR ANY MANAGER OF THE CERTIFIED  BANK
CAPITAL  COMPANY  EACH HAVE NO LESS THAN FIVE YEARS OF EXPERIENCE IN THE
VENTURE CAPITAL OR A VENTURE CAPITAL-RELATED INDUSTRY.
  (6) ANY OFFERING MATERIAL INVOLVING THE  SALE  OF  SECURITIES  OF  THE
CERTIFIED BANK CAPITAL COMPANY SHALL INCLUDE THE FOLLOWING STATEMENT:
  "THE AUTHORIZATION OF THE FORMATION OF A CERTIFIED BANK CAPITAL COMPA-
NY  DOES  NOT  CONSTITUTE THE ENDORSEMENT OF THE STATE OF NEW YORK AS TO
EITHER THE QUALITY OF MANAGEMENT OR THE POTENTIAL FOR EARNINGS  OF  SUCH
COMPANY.  THE STATE OF NEW YORK IS NOT LIABLE FOR DAMAGES OR LOSSES TO A
CERTIFIED  BANK  INVESTOR IN THE COMPANY. USE OF THE WORD 'CERTIFIED' IN
AN OFFERING DOES NOT CONSTITUTE A RECOMMENDATION OR ENDORSEMENT  OF  THE
INVESTMENT BY THE STATE OF NEW YORK.
  INVESTMENTS  IN  A PROSPECTIVE CERTIFIED BANK CAPITAL COMPANY PRIOR TO
THE TIME SUCH COMPANY IS CERTIFIED ARE NOT ELIGIBLE FOR TAX CREDITS.  IN
THE  EVENT  CERTAIN  STATUTORY PROVISIONS (AS SPECIFIED IN SECTION 30 OF
THE TAX LAW) ARE VIOLATED, THE STATE OF NEW YORK MAY REQUIRE  FORFEITURE
OF UNUSED TAX CREDITS AND REPAYMENT OF USED TAX CREDITS."
  (7)  WITHIN  SIXTY DAYS OF APPLICATION, THE SUPERINTENDENT SHALL ISSUE
THE CERTIFICATION OR SHALL REFUSE THE CERTIFICATION AND  COMMUNICATE  IN
DETAIL   TO  THE  APPLICANT  THE  GROUNDS  FOR  THE  REFUSAL,  INCLUDING
SUGGESTIONS FOR THE REMOVAL OF THOSE GROUNDS.
  (C) REQUIREMENTS FOR CONTINUANCE OF CERTIFICATION. (1) TO CONTINUE  TO
BE  CERTIFIED,  A  CERTIFIED  BANK  CAPITAL  COMPANY MUST MAKE QUALIFIED
INVESTMENTS ACCORDING TO THE FOLLOWING SCHEDULE:
  (A) WITHIN TWO YEARS AFTER THE CERTIFICATION DATE OF A CERTIFIED  BANK
CAPITAL  COMPANY,  AT  LEAST  TWENTY-FIVE  PERCENT OF ITS CERTIFIED BANK
CAPITAL MUST BE PLACED IN QUALIFIED INVESTMENTS.
  (B) WITHIN THREE YEARS AFTER THE CERTIFICATION  DATE  OF  A  CERTIFIED
BANK CAPITAL COMPANY, AT LEAST FORTY PERCENT OF ITS CERTIFIED BANK CAPI-
TAL MUST BE PLACED IN QUALIFIED INVESTMENTS.
  (C) WITHIN FOUR YEARS AFTER THE CERTIFICATION DATE OF A CERTIFIED BANK
CAPITAL  COMPANY,  AT  LEAST FIFTY PERCENT OF ITS CERTIFIED BANK CAPITAL
MUST BE PLACED IN QUALIFIED INVESTMENTS, AT LEAST FIFTY PERCENT OF WHICH
MUST HAVE BEEN PLACED IN EARLY STAGE BUSINESSES.
  (D) A CERTIFIED BANK CAPITAL COMPANY, AT LEAST  FIFTEEN  WORKING  DAYS
PRIOR  TO  MAKING  A  PROPOSED  INVESTMENT IN A SPECIFIC BUSINESS, SHALL
CERTIFY IN WRITING TO THE SUPERINTENDENT THAT THE BUSINESS IN  WHICH  IT
PROPOSES  TO  INVEST  MEETS  THE  DEFINITION OF A QUALIFIED BUSINESS SET

A. 2817                             6

FORTH IN PARAGRAPH SIX OF SUBDIVISION (A) OF THIS  SECTION  OR,  IN  THE
CASE OF A FOLLOW-ON INVESTMENT, THAT SUCH BUSINESS CONTINUES TO MEET THE
REQUIREMENTS  SET FORTH IN SUBPARAGRAPHS (A) AND (C) OF PARAGRAPH SIX OF
SUBDIVISION  (A)  OF THIS SECTION AND, IN EITHER CASE, AN EXPLANATION OF
ITS DETERMINATION THAT THE BUSINESS MEETS SUCH REQUIREMENTS. THE CERTIF-
ICATION TO THE SUPERINTENDENT SHALL INCLUDE A SWORN STATEMENT  FROM  THE
BUSINESS IN WHICH THE CERTIFIED BANK CAPITAL COMPANY PROPOSES TO INVEST,
WHICH STATEMENT SHALL EVIDENCE THE INTENTION OF THE BUSINESS TO MAINTAIN
ITS HEADQUARTERS IN NEW YORK AND CONDUCT ITS PRIMARY BUSINESS OPERATIONS
IN  THE  STATE  OF  NEW  YORK AFTER ITS RECEIPT OF THE INVESTMENT BY THE
CERTIFIED BANK CAPITAL COMPANY. IF THE  SUPERINTENDENT  DETERMINES  THAT
THE BUSINESS DOES NOT MEET THE DEFINITION OF A QUALIFIED BUSINESS OR, IN
THE CASE OF A FOLLOW-ON INVESTMENT, THAT SUCH BUSINESS DOES NOT MEET THE
REQUIREMENTS  SET FORTH IN SUBPARAGRAPHS (A) AND (C) OF PARAGRAPH SIX OF
SUBDIVISION (A) OF THIS SECTION,  THEN  HE  OR  SHE  SHALL,  WITHIN  THE
FIFTEEN  WORKING  DAY PERIOD PRIOR TO THE MAKING OF THE PROPOSED INVEST-
MENT, NOTIFY THE CERTIFIED BANK CAPITAL COMPANY OF HIS OR  HER  DETERMI-
NATION AND PROVIDE AN EXPLANATION THEREOF.
  (E)  ALL CERTIFIED BANK CAPITAL NOT PLACED IN QUALIFIED INVESTMENTS BY
THE CERTIFIED BANK CAPITAL COMPANY MAY  BE  HELD  OR  INVESTED  IN  SUCH
MANNER  AS  THE CERTIFIED BANK CAPITAL COMPANY, IN ITS DISCRETION, DEEMS
APPROPRIATE. THE PROCEEDS OF ALL CERTIFIED BANK CAPITAL  RETURNED  TO  A
CERTIFIED  BANK  CAPITAL COMPANY AFTER BEING ORIGINALLY PLACED IN QUALI-
FIED INVESTMENTS MAY BE PLACED AGAIN IN QUALIFIED INVESTMENTS AND  SHALL
COUNT TOWARD ANY REQUIREMENT IN THIS SUBDIVISION WITH RESPECT TO PLACING
CERTIFIED BANK CAPITAL IN QUALIFIED INVESTMENTS.
  (2)  ANY  BUSINESS  WHICH IS CLASSIFIED AS A QUALIFIED BUSINESS AT THE
TIME OF THE FIRST INVESTMENT IN SAID BUSINESS BY A CERTIFIED BANK  CAPI-
TAL  COMPANY  SHALL  REMAIN  CLASSIFIED  AS A QUALIFIED BUSINESS AND MAY
RECEIVE FOLLOW-ON INVESTMENTS FROM ANY CERTIFIED BANK  CAPITAL  COMPANY,
AND  ANY  SUCH  FOLLOW-ON  INVESTMENTS  SHALL  BE  QUALIFIED INVESTMENTS
ALTHOUGH SUCH BUSINESS MAY NOT MEET THE DEFINITION OF A QUALIFIED  BUSI-
NESS  AT THE TIME OF SUCH FOLLOW-ON INVESTMENTS; PROVIDED, HOWEVER, THAT
SUCH BUSINESS CONTINUES TO MEET THE REQUIREMENTS SET FORTH  IN  SUBPARA-
GRAPHS  (A)  AND (C) OF PARAGRAPH SIX OF SUBDIVISION (A) OF THIS SECTION
AND REAFFIRMS ITS INTENTION TO MAINTAIN ITS HEADQUARTERS IN NEW YORK AND
CONDUCT ITS PRIMARY BUSINESS OPERATIONS IN THE  STATE  OF  NEW  YORK  AS
REQUIRED IN SUBPARAGRAPH (D) OF PARAGRAPH ONE OF THIS SUBDIVISION.
  (3)  NO  QUALIFIED  INVESTMENT MAY BE MADE BY A CERTIFIED BANK CAPITAL
COMPANY TO THE EXTENT THAT SUCH INVESTMENT  WOULD  CAUSE  THE  COMPANY'S
TOTAL  QUALIFIED  INVESTMENT  OUTSTANDING  WITH RESPECT TO THE QUALIFIED
BUSINESS RECEIVING SUCH INVESTMENT TO  EXCEED  FIFTEEN  PERCENT  OF  THE
TOTAL  CERTIFIED  BANK  CAPITAL OF THE CERTIFIED BANK CAPITAL COMPANY AT
THE TIME OF SUCH INVESTMENT.
  (4) DOCUMENTS AND OTHER MATERIALS SUBMITTED BY CERTIFIED BANK  CAPITAL
COMPANIES  OR  BY  BUSINESSES FOR PURPOSES OF THE CONTINUANCE OF CERTIF-
ICATION SHALL NOT BE PUBLIC RECORDS IF SUCH RECORDS  ARE  DETERMINED  BY
THE  SUPERINTENDENT  TO  BE TRADE OR BUSINESS SECRETS AND SHALL BE MAIN-
TAINED IN A CONFIDENTIAL MANNER BY THE SUPERINTENDENT.
  (5) THE AGGREGATE CUMULATIVE AMOUNT OF ALL QUALIFIED INVESTMENTS  MADE
BY  A  CERTIFIED BANK CAPITAL COMPANY FROM THE DATE OF ITS CERTIFICATION
SHALL BE CONSIDERED IN THE CALCULATION OF  THE  PERCENTAGE  REQUIREMENTS
UNDER  SUBPARAGRAPHS (A), (B), AND (C) OF PARAGRAPH ONE OF THIS SUBDIVI-
SION.
  (6) EACH CERTIFIED BANK CAPITAL COMPANY SHALL REPORT THE FOLLOWING  TO
THE SUPERINTENDENT:

A. 2817                             7

  (A) AS SOON AS PRACTICABLE AFTER THE RECEIPT OF CERTIFIED BANK CAPITAL
OR  AN  IRREVOCABLE FUNDING COMMITMENT SUBJECT ONLY TO THE RECEIPT OF AN
ALLOCATION PURSUANT TO SUBDIVISION (H) OF THIS SECTION, (I) THE NAME  OF
EACH  CERTIFIED  BANK INVESTOR FROM WHICH THE CERTIFIED BANK CAPITAL WAS
RECEIVED,  INCLUDING  SUCH  CERTIFIED BANK INVESTOR'S TAX IDENTIFICATION
NUMBER; (II) THE AMOUNT OF EACH CERTIFIED BANK INVESTOR'S INVESTMENT  OF
CERTIFIED  BANK  CAPITAL; AND (III) THE DATE ON WHICH THE CERTIFIED BANK
CAPITAL WAS RECEIVED; PROVIDED HOWEVER, THAT NO  SUCH  REPORT  SHALL  BE
FILED WITH THE SUPERINTENDENT PRIOR TO MARCH FIRST, TWO THOUSAND TEN FOR
CERTIFIED BANK CAPITAL INVESTED AFTER SUCH DATE.
  (B)  ON  AN  ANNUAL  BASIS,  ON OR BEFORE JANUARY THIRTY-FIRST OF EACH
YEAR, (I) THE AMOUNT OF THE CERTIFIED BANK CAPITAL  COMPANY'S  CERTIFIED
BANK  CAPITAL AT THE END OF THE IMMEDIATELY PRECEDING YEAR; (II) WHETHER
OR NOT THE CERTIFIED BANK CAPITAL COMPANY HAS INVESTED MORE THAN FIFTEEN
PERCENT OF ITS TOTAL CERTIFIED BANK CAPITAL IN  ANY  ONE  BUSINESS;  AND
(III)  ALL QUALIFIED INVESTMENTS THAT THE CERTIFIED BANK CAPITAL COMPANY
MADE DURING THE PREVIOUS CALENDAR YEAR, INCLUDING THE NUMBER OF  EMPLOY-
EES  OF  EACH QUALIFIED BUSINESS IN WHICH IT HAS MADE INVESTMENTS AT THE
TIME OF SUCH INVESTMENT.
  (C) EACH CERTIFIED BANK CAPITAL COMPANY SHALL PROVIDE  TO  THE  SUPER-
INTENDENT  ANNUAL  AUDITED FINANCIAL STATEMENTS, WHICH SHALL INCLUDE THE
OPINION OF AN INDEPENDENT CERTIFIED  PUBLIC  ACCOUNTANT,  WITHIN  NINETY
DAYS  OF THE CLOSE OF ITS FISCAL YEAR. THE AUDIT SHALL ADDRESS THE METH-
ODS OF OPERATION AND CONDUCT OF THE BUSINESS OF THE CERTIFIED BANK CAPI-
TAL COMPANY TO DETERMINE WHETHER  OR  NOT  THE  CERTIFIED  BANK  CAPITAL
COMPANY  IS COMPLYING WITH THE APPLICABLE STATUTES AND PROGRAM RULES AND
WHETHER OR NOT THE FUNDS RECEIVED BY THE CERTIFIED BANK CAPITAL  COMPANY
HAVE  BEEN INVESTED AS REQUIRED UNDER SUBPARAGRAPHS (A), (B), AND (C) OF
PARAGRAPH ONE OF THIS SUBDIVISION.
  (D) ON OR BEFORE APRIL FIRST OF EACH YEAR, EACH CERTIFIED BANK CAPITAL
COMPANY SHALL PAY AN ANNUAL, NON-REFUNDABLE CERTIFICATION  FEE  OF  FIVE
HUNDRED  DOLLARS  TO THE SUPERINTENDENT; PROVIDED THAT NO SUCH FEE SHALL
BE REQUIRED WITHIN SIX MONTHS OF THE INITIAL  CERTIFICATION  DATE  OF  A
CERTIFIED BANK COMPANY.
  (E)  (1)  WITHIN  THIRTY  DAYS  OF  THE DECISION ON AN APPLICATION FOR
CERTIFICATION PURSUANT TO SUBDIVISION (B) OF THIS  SECTION,  THE  SUPER-
INTENDENT  SHALL SUBMIT A COPY OF SUCH APPLICATION AND THE RELATED DECI-
SION TO THE DEPARTMENT OF TAXATION AND FINANCE. THE SUPERINTENDENT SHALL
SUBMIT A COPY OF ALL FILINGS OF CERTIFICATIONS PURSUANT TO  SUBPARAGRAPH
(D)  OF  PARAGRAPH  ONE  OF THIS SUBDIVISION, AND ANY DETERMINATION MADE
THEREON, WITHIN FIFTEEN DAYS OF SUCH FILING TO THE DEPARTMENT  OF  TAXA-
TION AND FINANCE.
  (2)  THE  SUPERINTENDENT SHALL ANNUALLY, BY MARCH FIRST, SUBMIT TO THE
DEPARTMENT OF TAXATION AND FINANCE A LIST OF  CERTIFIED  BANK  INVESTORS
WHO MAY CLAIM THE TAX CREDIT FOR THE PREVIOUS TAXABLE YEAR AND ANY OTHER
INFORMATION  NECESSARY  TO ASSIST THE DEPARTMENT OF TAXATION AND FINANCE
TO DETERMINE ELIGIBILITY FOR SUCH TAX CREDIT.
  (D) DISTRIBUTIONS. (1) A CERTIFIED BANK CAPITAL COMPANY MAY MAKE QUAL-
IFIED DISTRIBUTIONS AT ANY TIME. IN ORDER FOR A CERTIFIED  BANK  CAPITAL
COMPANY  TO  MAKE A DISTRIBUTION OTHER THAN A QUALIFIED DISTRIBUTION, TO
ITS EQUITY HOLDERS, EITHER (A) THE AGGREGATE CUMULATIVE  AMOUNT  OF  ALL
QUALIFIED  INVESTMENTS  MUST  EQUAL OR EXCEED ONE HUNDRED PERCENT OF ITS
CERTIFIED BANK CAPITAL ALLOCATED, OR (B) IT MUST HAVE  RECEIVED  WRITTEN
AUTHORIZATION  TO  MAKE SUCH DISTRIBUTION FROM THE SUPERINTENDENT. IN NO
EVENT, HOWEVER, SHALL ANY SUCH  DISTRIBUTION,  OTHER  THAN  A  QUALIFIED
DISTRIBUTION,  BE  MADE  BY  A  CERTIFIED BANK CAPITAL COMPANY UNLESS AN

A. 2817                             8

AMOUNT EQUAL CUMULATIVELY TO AT LEAST NINETY PERCENT  OF  ITS  CERTIFIED
BANK CAPITAL IS INVESTED IN COMPANIES THAT CONDUCT THEIR PRINCIPAL BUSI-
NESS OPERATIONS IN NEW YORK STATE.
  (2)  IN  THE  EVENT THAT A BUSINESS IN WHICH A QUALIFIED INVESTMENT IS
MADE RELOCATES ITS PRINCIPAL BUSINESS OPERATIONS TO ANOTHER STATE DURING
SUCH INVESTMENT, OR WITHIN THREE MONTHS AFTER THE  TERMINATION  OF  SUCH
INVESTMENT,  THE  CUMULATIVE  AMOUNT  OF  QUALIFIED  INVESTMENT SHALL BE
REDUCED BY THE AMOUNT OF SUCH QUALIFIED INVESTMENT, FOR THE PURPOSES  OF
THIS  SUBDIVISION  ONLY,  UNLESS  (A) THE CERTIFIED BANK CAPITAL COMPANY
INVESTS AN AMOUNT, AT LEAST EQUAL TO THE INVESTMENT  OF  CERTIFIED  BANK
CAPITAL IN THE RELOCATED BUSINESS IN A QUALIFIED BUSINESS LOCATED IN NEW
YORK  STATE  WITHIN SIX MONTHS OF THE RELOCATION OR (B) UNLESS THE BUSI-
NESS DEMONSTRATES THAT IT HAS RETURNED ITS PRINCIPAL BUSINESS OPERATIONS
TO NEW YORK STATE WITHIN THREE MONTHS OF  SUCH  RELOCATION.  A  BUSINESS
SHALL  BE  DEEMED  TO  HAVE  RELOCATED ITS PRINCIPAL BUSINESS OPERATIONS
OUTSIDE NEW YORK STATE IF THE  PRIMARY  WORKPLACE  OF  MORE  THAN  FIFTY
PERCENT  OF THE EMPLOYEES OF SUCH BUSINESS EMPLOYED WITHIN THE STATE ARE
RELOCATED TO ANOTHER STATE.
  (3) PAYMENTS TO DEBT HOLDERS OF A CERTIFIED BANK CAPITAL  COMPANY  MAY
BE  MADE WITHOUT RESTRICTION WITH RESPECT TO REPAYMENTS OF PRINCIPAL AND
INTEREST ON INDEBTEDNESS OWED TO THEM BY A CERTIFIED BANK CAPITAL COMPA-
NY, INCLUDING INDEBTEDNESS OF THE  CERTIFIED  BANK  CAPITAL  COMPANY  ON
WHICH CERTIFIED BANK INVESTORS EARNED TAX CREDITS. A DEBT HOLDER THAT IS
ALSO  A  CERTIFIED  BANK  INVESTOR  OR EQUITY HOLDER OF A CERTIFIED BANK
CAPITAL COMPANY MAY RECEIVE PAYMENTS WITH RESPECT TO SUCH  DEBT  WITHOUT
ANY RESTRICTION WHATSOEVER.
  (E)  DECERTIFICATION.  (1)  THE SUPERINTENDENT SHALL CONDUCT AN ANNUAL
REVIEW OF EACH CERTIFIED BANK CAPITAL COMPANY TO  DETERMINE  WHETHER  OR
NOT THE CERTIFIED BANK CAPITAL COMPANY IS ABIDING BY THE REQUIREMENTS OF
CERTIFICATION,  TO  ADVISE  THE CERTIFIED BANK CAPITAL COMPANY AS TO THE
ELIGIBILITY STATUS OF ITS QUALIFIED INVESTMENTS, AND TO ENSURE  THAT  NO
INVESTMENT  HAS  BEEN MADE IN VIOLATION OF THIS SUBDIVISION. THE COST OF
THE ANNUAL REVIEW SHALL BE PAID BY EACH CERTIFIED BANK  CAPITAL  COMPANY
ACCORDING TO A REASONABLE FEE SCHEDULE ADOPTED BY THE SUPERINTENDENT.
  (2) ANY MATERIAL VIOLATION OF SUBDIVISION (C) OF THIS SECTION SHALL BE
GROUNDS  FOR  DECERTIFICATION  OF THE CERTIFIED BANK CAPITAL COMPANY. IF
THE SUPERINTENDENT DETERMINES THAT A CERTIFIED BANK CAPITAL  COMPANY  IS
NOT  IN  COMPLIANCE  WITH  THE  REQUIREMENTS  OF SUBDIVISION (C) OF THIS
SECTION, HE OR SHE SHALL, BY WRITTEN NOTICE, INFORM THE OFFICERS OF  THE
CERTIFIED  BANK  CAPITAL COMPANY THAT THE CERTIFIED BANK CAPITAL COMPANY
WILL BE SUBJECT TO DECERTIFICATION IN ONE HUNDRED TWENTY DAYS  FROM  THE
DATE OF THE MAILING OF THE NOTICE, UNLESS THE DEFICIENCIES ARE CORRECTED
AND  THE  CERTIFIED BANK CAPITAL COMPANY IS AGAIN IN COMPLIANCE WITH ALL
REQUIREMENTS FOR CERTIFICATION.
  (3) AT THE END OF THE ONE HUNDRED TWENTY  DAY  GRACE  PERIOD,  IF  THE
CERTIFIED  BANK CAPITAL COMPANY IS STILL NOT IN COMPLIANCE WITH SUBDIVI-
SION (C) OF THIS SECTION, THE SUPERINTENDENT  SHALL  SEND  A  NOTICE  OF
DECERTIFICATION  TO  THE CERTIFIED BANK CAPITAL COMPANY AND TO ALL OTHER
APPROPRIATE STATE AGENCIES.
  (4) ONCE A CERTIFIED BANK  CAPITAL  COMPANY  HAS  INVESTED  AN  AMOUNT
CUMULATIVELY EQUAL TO ONE HUNDRED PERCENT  OF ITS CERTIFIED BANK CAPITAL
IN  QUALIFIED  INVESTMENTS AND HAS MET ALL OTHER REQUIREMENTS UNDER THIS
SUBDIVISION, THE CERTIFIED BANK  CAPITAL  COMPANY  SHALL  NO  LONGER  BE
SUBJECT  TO  REGULATION  BY  THE  SUPERINTENDENT  AND SHALL NO LONGER BE
SUBJECT TO THE REQUIREMENTS OF SUBDIVISION (C) OF THIS SECTION.

A. 2817                             9

  (5) THE SUPERINTENDENT SHALL SEND WRITTEN  NOTICE  OF  SUCH  DECERTIF-
ICATION  TO THE ADDRESS OF EACH CERTIFIED BANK INVESTOR WHOSE TAX CREDIT
HAS BEEN SUBJECT TO RECAPTURE OR FORFEITURE, USING THE ADDRESS SHOWN  ON
THE LAST FILING SUBMITTED TO THE SUPERINTENDENT.
  (F)  REVOCATION  OF  CERTIFICATION.  THE SUPERINTENDENT MAY REVOKE THE
CERTIFICATION OF A CERTIFIED BANK CAPITAL COMPANY IF ANY MATERIAL REPRE-
SENTATION TO THE SUPERINTENDENT IN CONNECTION WITH THE APPLICATION PROC-
ESS PROVES TO HAVE BEEN FALSELY MADE OR IF  THE  APPLICATION  MATERIALLY
VIOLATES  ANY  REQUIREMENT ESTABLISHED BY THE SUPERINTENDENT PURSUANT TO
THIS SECTION.
  (G) REGISTRATION REQUIREMENTS. ALL INVESTMENTS FOR WHICH  TAX  CREDITS
ARE ALLOWABLE UNDER THE PROVISIONS OF SUBSECTION (U) OF SECTION FOURTEEN
HUNDRED  FIFTY-SIX OF THIS CHAPTER SHALL SATISFY THE CONDITIONS OF BEING
REGISTERED OR SPECIFICALLY EXEMPT FROM  REGISTRATION  BY  PROVISIONS  OR
REGULATIONS  UNDER  SECTIONS  THREE  HUNDRED  FIFTY-NINE-E THROUGH THREE
HUNDRED FIFTY-NINE-FF OF ARTICLE TWENTY-THREE-A OF THE GENERAL  BUSINESS
LAW.
  (H)  MAXIMUM PERMITTED CREDITS. THE AGGREGATE AMOUNT OF CERTIFIED BANK
CAPITAL FOR WHICH TAXPAYERS MAY BE ALLOCATED  AND  ALLOWED  TAX  CREDITS
PURSUANT  TO THIS SECTION AND SUBSECTION (U) OF SECTION FOURTEEN HUNDRED
FIFTY-SIX OF THIS CHAPTER MAY  NOT  EXCEED  FIFTY  MILLION  DOLLARS  FOR
CALENDAR  YEAR  TWO THOUSAND ELEVEN, WHICH CERTIFIED BANK CAPITAL MAY BE
INVESTED IN CERTIFIED BANK CAPITAL COMPANIES BEGINNING IN CALENDAR  YEAR
TWO  THOUSAND  TEN.  IN CALENDAR YEAR TWO THOUSAND TWELVE OR THEREAFTER,
TAX CREDITS MAY BE ALLOWED PURSUANT TO THIS SECTION AND SUCH  SUBSECTION
(U)  OF  SECTION FOURTEEN HUNDRED FIFTY-SIX OF THIS CHAPTER FOR AN ADDI-
TIONAL FIFTY MILLION DOLLARS OF CERTIFIED BANK CAPITAL, WHICH  CERTIFIED
BANK  CAPITAL MAY BE INVESTED IN CERTIFIED BANK CAPITAL COMPANIES BEGIN-
NING IN CALENDAR YEAR TWO THOUSAND ELEVEN, IF NOT ALLOCATED TO  CALENDAR
YEAR  TWO  THOUSAND  TEN IN ACCORDANCE WITH THIS SUBDIVISION. THEREFORE,
THE TOTAL AMOUNT OF CERTIFIED BANK CAPITAL FOR WHICH TAX CREDITS MAY  BE
ALLOWED  PURSUANT  TO  THIS  SECTION  AND SUCH SUBSECTION (U) OF SECTION
FOURTEEN HUNDRED FIFTY-SIX SHALL BE ONE HUNDRED MILLION DOLLARS.
  DURING ANY CALENDAR YEAR IN WHICH THE  LIMITATION  DESCRIBED  IN  THIS
SUBDIVISION  WILL  LIMIT THE AMOUNT OF CERTIFIED BANK CAPITAL, CERTIFIED
BANK CAPITAL SHALL BE ALLOCATED IN ORDER OF PRIORITY BASED UPON THE DATE
OF FILING OF INFORMATION DESCRIBED IN SUBPARAGRAPH (A) OF PARAGRAPH  SIX
OF  SUBDIVISION  (C)  OF THIS SECTION. CERTIFIED BANK CAPITAL LIMITED IN
ANY CALENDAR YEAR BY THE APPLICATION OF THE PROVISIONS OF THIS  SUBDIVI-
SION SHALL BE ALLOWED AND ALLOCATED IN THE IMMEDIATELY SUCCEEDING CALEN-
DAR  YEAR IN ORDER OF PRIORITY SET FORTH IN THIS SUBDIVISION. THE SUPER-
INTENDENT SHALL ADVISE ANY CERTIFIED BANK CAPITAL COMPANY,  IN  WRITING,
WITHIN  FIFTEEN  DAYS  AFTER  RECEIVING  SUCH FILING, WHETHER OR NOT THE
LIMITATIONS OF THIS SUBDIVISION THEN IN EFFECT WILL BE  APPLICABLE  WITH
RESPECT TO THE INVESTMENTS AND CREDITS DESCRIBED IN SUCH FILING WITH THE
SUPERINTENDENT.
  CERTIFIED  BANK  CAPITAL  MAY BE RAISED BY EACH CERTIFIED BANK CAPITAL
COMPANY AT ANY TIME SUBSEQUENT TO ITS CERTIFICATION  DATE,  AND  CREDITS
SHALL BE ALLOCATED TO AND VESTED IN CERTIFIED BANK INVESTORS AT THE TIME
OF  EACH  SUCH INVESTMENT AS PROVIDED IN THIS SUBDIVISION, ALTHOUGH SUCH
CREDITS SHALL NOT BE FIRST ALLOWED OR INCURRED FOR STATE  TAX  PURPOSES,
UNTIL,  AT THE EARLIEST, TAX YEARS BEGINNING IN TWO THOUSAND ELEVEN WITH
RESPECT TO THE FIRST FIFTY MILLION DOLLARS  OF  CREDITS  AND  TAX  YEARS
BEGINNING  IN  TWO  THOUSAND  TWELVE WITH RESPECT TO THE NEXT SUCH FIFTY
MILLION DOLLARS OF CREDITS.

A. 2817                            10

  (I) MAXIMUM CERTIFIED BANK CAPITAL. THE MAXIMUM  AMOUNT  OF  CERTIFIED
BANK  CAPITAL  INVESTED  IN ONE OR MORE CERTIFIED BANK CAPITAL COMPANIES
ALLOWED IN ANY ONE YEAR TO ANY ONE CERTIFIED  BANK  INVESTOR  SHALL  NOT
EXCEED TEN MILLION DOLLARS FOR SUCH YEAR; PROVIDED, HOWEVER, THAT IF THE
AGGREGATE  AMOUNT  OF CERTIFIED BANK CAPITAL FOR SUCH YEAR, AS SET FORTH
IN SUBDIVISION (H) OF THIS SECTION, HAS  NOT  BEEN  REACHED  SIXTY  DAYS
PRIOR TO THE END OF THE YEAR TO WHICH SUCH AGGREGATE AMOUNT APPLIES, THE
PROVISIONS OF THIS SUBDIVISION SHALL CEASE TO APPLY FOR THE REMAINDER OF
SUCH  YEAR.  IN ADDITION, THE AGGREGATE AMOUNT OF TAX CREDITS ALLOWED IN
ANY TAXABLE YEAR TO ANY AFFILIATED GROUP OF  TAXPAYERS  IN  RELATION  TO
CERTIFIED  BANK  CAPITAL  MAY NOT EXCEED TEN MILLION DOLLARS, WHETHER OR
NOT SUCH TAXPAYERS FILE A COMBINED RETURN PURSUANT TO SUBSECTION (F)  OF
SECTION  FOURTEEN HUNDRED SIXTY-TWO OF THIS CHAPTER. FOR PURPOSES OF THE
PRECEDING SENTENCE, THE TERM "AFFILIATED  GROUP"  SHALL  HAVE  THE  SAME
MEANING  AS  DESCRIBED  IN  SECTION  1504  OF THE INTERNAL REVENUE CODE,
EXCEPT THAT THE REFERENCES TO "AT LEAST EIGHTY PERCENT" IN SUCH  SECTION
1504 SHALL BE READ AS "MORE THAN FIFTY PERCENT".
  (J)  REPORTS.  THE  SUPERINTENDENT  SHALL  REPORT TO THE GOVERNOR, THE
TEMPORARY PRESIDENT OF THE SENATE, AND THE SPEAKER OF THE  ASSEMBLY,  ON
OR  BEFORE  JUNE  FIRST  OF EACH YEAR BEGINNING IN THE YEAR TWO THOUSAND
TWELVE, THE NUMBER OF CERTIFIED BANK CAPITAL COMPANIES HOLDING CERTIFIED
BANK CAPITAL; THE AMOUNT OF CERTIFIED  BANK  CAPITAL  INVESTED  IN  EACH
CERTIFIED  BANK  CAPITAL COMPANY; THE CUMULATIVE AMOUNT THAT EACH CERTI-
FIED BANK CAPITAL COMPANY HAS INVESTED AS OF JANUARY FIRST OF  THE  YEAR
TWO  THOUSAND  TWELVE AND THE CUMULATIVE TOTAL EACH YEAR THEREAFTER; THE
TOTAL AMOUNT OF TAX CREDITS GRANTED UNDER THIS SECTION  EACH  YEAR  THAT
CREDITS  HAVE  BEEN  AWARDED  UNDER  THIS  SECTION AND SUBSECTION (U) OF
SECTION FOURTEEN HUNDRED FIFTY-SIX OF THIS CHAPTER; THE  PERFORMANCE  OF
EACH  CERTIFIED BANK CAPITAL COMPANY WITH REGARD TO THE REQUIREMENTS FOR
RECERTIFICATION SET FORTH IN SUBDIVISION (C) OF THIS SECTION; THE  CLAS-
SIFICATION OF COMPANIES IN WHICH EACH CERTIFIED BANK CAPITAL COMPANY HAS
INVESTED  ACCORDING  TO INDUSTRIAL SECTOR AND SIZE OF COMPANY; THE TOTAL
NUMBER OF JOBS CREATED BY INVESTMENTS MADE BY EACH CERTIFIED BANK  CAPI-
TAL COMPANY USING CERTIFIED BANK CAPITAL; AND THOSE CERTIFIED BANK CAPI-
TAL  COMPANIES  THAT  HAVE  BEEN  DECERTIFIED, OR HAVE HAD THEIR CERTIF-
ICATIONS  REVOKED,  INCLUDING  THE  REASONS   FOR   DECERTIFICATION   OR
REVOCATION.
  (K)  RULES  AND  REGULATIONS. THE SUPERINTENDENT, IN CONSULTATION WITH
THE DEPARTMENT OF TAXATION AND FINANCE, SHALL PRESCRIBE SUCH  RULES  AND
REGULATIONS  AS HE OR SHE SHALL DEEM NECESSARY IN ORDER TO IMPLEMENT THE
PROVISIONS OF THIS SECTION WITHIN ONE HUNDRED TWENTY DAYS OF THE  EFFEC-
TIVE DATE OF THIS SECTION.
  S 4. This act shall take effect immediately.