RS 1927.1 - Annual audit; annual rate of return; appreciation excess; remittance to Louisiana Economic Development Fund
A. Following a decertification of a pool that was certified on or after January 1, 1999, and for which insurance premium tax credits were granted, an independent certified public accountant shall perform a review of all distributions other than tax distributions and management fees from such pool to the equity holders of the pool to determine if such distributions produce an annual internal rate of return to the equity holders of the pool of at least fifteen percent calculated on the original amount of certified capital contributed to such pool as well as any additional capital contributed to such pool. Within thirty days following the issuance of the accountant's report, the certified capital company shall remit to the Louisiana Economic Development Fund twenty-five percent of all distributions in excess of the amount required to produce an annual internal rate of return of fifteen percent until the Louisiana Economic Development Fund shall have received an amount equal to the amount of tax credits granted for the pool. Thereafter, the certified capital company shall remit to the Louisiana Economic Development Fund five percent of such excess distributions.
B. Following a decertification of a pool that was certified on or after January 1, 2002, and for which income tax credits or insurance premium tax credits were granted, an independent certified public accountant shall annually perform a review of all distributions, other than tax distributions and management fees, from such pool to the equity holders of the pool to determine if such distributions produce a rate of return to the equity holders of the pool of at least ten percent calculated on the original amount of certified capital contributed to such pool as well as any additional capital contributed to such pool. Within thirty days following the issuance of the accountant's annual report, the certified capital company shall remit twenty-five percent of all distributions in excess of the amount required to produce a rate of return of ten percent to the Louisiana Economic Development Fund.
C. The calculation of internal rate of return shall include all cash distributions to equity investors out of the certified capital company's investment pool, except for tax distributions and management fees. Management fees shall not exceed two and one-half percent per annum of the total certified capital of the pool without the prior approval of the secretary. Notwithstanding any other provisions in this Chapter to the contrary, for all certified capital pools formed after December 31, 2001, if a certified Louisiana capital company does not place (1) forty percent of the investment pool in qualified investments within three years after the investment date, (2) sixty percent of the investment pool in qualified investments within five years of the investment date, and (3) upon the certified Louisiana capital company's option either (a) one hundred percent of the investment pool in qualified investments within seven years of the investment date or (b) one hundred and ten percent of the investment pool in qualified investments within eight years of the investment date, then following a decertification pursuant to R.S. 51:1928(B)(3), such company shall remit to the Louisiana Economic Development Fund twenty-five percent of all distributions, other than tax distributions and management fees, until the Louisiana Economic Development Fund shall have received one hundred percent of the tax credits granted for such pool and thereafter the company shall remit ten percent of all distributions, other than tax distributions and management fees to the Louisiana Economic Development Fund. If a certified Louisiana capital company has not decertified an investment pool formed after December 31, 2001, pursuant to R.S. 51:1928(B)(3) within ten years from the investment date, such company shall remit to the Louisiana Economic Development Fund fifty percent of all distributions until the Louisiana Economic Development Fund shall have received one hundred percent of the tax credits granted for such pool, and thereafter the company shall remit twenty percent of all distributions to the Louisiana Economic Development Fund.
D. Notwithstanding any other provision of this Chapter to the contrary and considering the adverse impact of Hurricanes Katrina and Rita, all investment deadlines required by this Section which would have fallen between August 25, 2005, and December 30, 2005, shall be extended to March 31, 2006.
Acts 1998, No. 70, §2, eff. Oct. 1, 1998; Acts 2002, No. 84, §2, eff. June 25, 2002; Acts 2005, 1st Ex. Sess., No. 15, §1, eff. Nov. 29, 2005; Acts 2009, No. 449, §1, eff. July 8, 2009.