S*1523 Session 108 (1989-1990)
S*1523(Rat #0602, Act #0505 of 1990) General Bill, By Senate Finance
A Bill to amend Section 41-44-10, as amended, Code of Laws of South Carolina,
1976, relating to the Palmetto Seed Capital Fund Limited Partnership, so as to
provide that the corporation to be formed to be the general partner of the
limited partnership is not required to be named the Palmetto Seed Capital
Corporation, and to provide that the credits allowed for investments in the
limited partnership also apply to a taxpayer's insurance premium tax
liability; to amend Section 41-44-60, as amended, relating to this limited
partnership, so as to make these above-referenced name and tax credit changes
and also to further provide for the use and investing of the investment monies
acquired by the Fund; to amend Act 643 of 1988, relating to this limited
partnership, so as to conform certain of its provisions to the
above-referenced name change provision; and to amend Sections 41-44-90 and
41-44-100, relating to this limited partnership, so as to conform them to the
above-referenced insurance premium tax credit provisions.
04/11/90 Senate Introduced, read first time, placed on calendar
without reference SJ-18
04/17/90 Senate Read second time SJ-21
04/17/90 Senate Ordered to third reading with notice of
amendments SJ-21
04/19/90 Senate Read third time and sent to House SJ-41
04/24/90 House Introduced, read first time, placed on calendar
without reference HJ-18
05/03/90 House Read second time HJ-15
05/08/90 House Read third time and enrolled HJ-18
05/24/90 Ratified R 602
05/29/90 Signed By Governor
05/29/90 Effective date 05/29/90
05/29/90 Act No. 505
06/19/90 Copies available
(A505, R602, S1523)
AN ACT TO AMEND SECTION 41-44-10, AS AMENDED, CODE OF LAWS OF SOUTH
CAROLINA, 1976, RELATING TO THE PALMETTO SEED CAPITAL FUND LIMITED
PARTNERSHIP, SO AS TO PROVIDE THAT THE CORPORATION TO BE FORMED TO BE
THE GENERAL PARTNER OF THE LIMITED PARTNERSHIP IS NOT REQUIRED TO BE
NAMED THE PALMETTO SEED CAPITAL CORPORATION, AND TO PROVIDE THAT THE
CREDITS ALLOWED FOR INVESTMENTS IN THE LIMITED PARTNERSHIP ALSO APPLY
TO A TAXPAYER'S INSURANCE PREMIUM TAX LIABILITY; TO AMEND SECTION
41-44-60, AS AMENDED, RELATING TO THIS LIMITED PARTNERSHIP, SO AS TO
MAKE THESE ABOVE-REFERENCED NAME AND TAX CREDIT CHANGES AND ALSO TO
FURTHER PROVIDE FOR THE USE AND INVESTING OF THE INVESTMENT MONIES
ACQUIRED BY THE FUND; TO AMEND ACT 643 OF 1988, RELATING TO THIS
LIMITED PARTNERSHIP, SO AS TO CONFORM CERTAIN OF ITS PROVISIONS TO THE
ABOVE-REFERENCED NAME CHANGE PROVISION; AND TO AMEND SECTIONS 41-44-90
AND 41-44-100, RELATING TO THIS LIMITED PARTNERSHIP, SO AS TO CONFORM
THEM TO THE ABOVE-REFERENCED INSURANCE PREMIUM TAX CREDIT PROVISIONS.
Be it enacted by the General Assembly of the State of South Carolina:
Purpose revised
SECTION 1. Section 1 of Act 643 of 1988 is amended to read:
"Section 1. The purpose of this act is to establish the
Palmetto Seed Capital Fund Limited Partnership whose purposes will
include but are not limited to increasing the rate of capital
formation, stimulating new growth-oriented business formations,
creating new jobs for South Carolina; developing new technology,
enhancing tax revenue for the State, and supplementing conventional
business financing."
Definitions revised
SECTION 2. (1) Section 41-44-10(B) of the 1976 Code is amended
to read:
"(B) The corporation means the corporate general partner
of the fund."
(2) Section 41-44-10(F) of the 1976 Code is amended to read:
"(F) State tax liability means a taxpayer s total income
tax liability that is incurred under Title 12 or insurance premium tax
liability incurred pursuant to Chapter 7 of Title 38, or both, as
computed after the application of credits, except the credits provided
by this chapter."
Corporate general partner; investment monies
SECTION 3. (1) Section 41-44-60(A) of the 1976 Code is amended
to read:
"(A) A corporation must be formed in the manner provided in
this chapter and by law to be the general partner of the Palmetto Seed
Capital Fund Limited Partnership, and operated pursuant to the laws of
this State. The articles of incorporation, bylaws, and any other
agreement relating to the organization or operation of the corporation
must comply with the provisions set forth in this section."
(2) Section 41-44-60(B) of the 1976 Code, as amended by Act 3 of
1989, is further amended to read:
"(B) The Governor shall cause the corporation to be formed,
and he shall designate the incorporators. The initial board of
directors must consist of three members, one of whom must be appointed
by the Governor and two of whom must be appointed by the State
Development Board. Members of the initial board of directors shall
serve three-year terms. The initial board of directors must be
representative of the State as a whole. The registered agent must be
designated by the Governor. The corporation s existence begins upon
filing of the articles of incorporation. The corporation s existence
is perpetual, unless dissolved as provided herein. The corporation is
authorized to issue shares of a number, class, and par or no-par
value, as provided in its articles of incorporation. The general
nature of the business of the corporation is to serve as general
partner of the Palmetto Seed Capital Fund Limited Partnership, to
provide financing to high growth oriented businesses, to provide seed
capital to South Carolina businesses, and to undertake any acts
appropriate or necessary to carry out the foregoing. The bylaws, the
organizational minutes, the election of officers, the issuance of any
stock of the corporation, and any other actions appropriate or
necessary for the organization and operation of the corporation must
be of that form and content as determined by the board of directors.
Nothing contained in the chapter may prohibit the shareholders or
board of directors of the corporation from altering, amending, or
otherwise modifying the articles of incorporation, bylaws, or any
other agreement governing the corporation as otherwise permitted
pursuant to the laws of this State, except that the general nature of
the business of the corporation may not be amended, altered, or
otherwise modified or restricted, and except that the corporation may
be dissolved, merged, or otherwise cease to exist pursuant to the
appropriate vote of the board of directors and shareholders. The
Governor may expend those discretionary funds as he has available and
considers appropriate for the purpose of organizing the corporation
and promoting the sale of the qualified investments."
(3) Section 41-44-60(E) of the 1976 Code, as amended by Act 3 of
1989, is further amended to read:
"(E) The fund shall raise funds to provide financing to
high growth oriented businesses. A high growth oriented business for
purposes of this chapter means a corporation, general partnership,
limited partnership, joint venture, trust, proprietorship, or other
similar entity or organization which is expected to experience
significant sales growth over the subsequent five-year period. All
investments made from investment monies raised by the fund, for which
the tax credit provided by this chapter is allowed and for which the
tax credit is made available by the fund in the prospectus or
offering, must be made to provide seed capital to South Carolina
businesses, this seed capital to be used primarily for the purpose of
enhancing the production capacity of these businesses or their ability
to do business in South Carolina. However, to the extent that the
fund directly induces seed capital monies from outside the State to be
invested in South Carolina businesses in which it is also investing,
the fund may substitute up to two-thirds of these outside monies for
its own capital in fulfillment of the requirements of this section.
Seventy percent of these investment monies induced into the State or
acquired by the fund for which the tax credit is allowed and available
must be invested to provide seed capital financing of either start-up
businesses or pre-start-up businesses. The remaining thirty percent
may be invested as the general partner of the fund determines to
provide capital to South Carolina businesses."
Tax credits for insurance premium taxes
SECTION 4. Section 41-44-90 of the 1976 Code is amended to read:
"Section 41-44-90. To receive the credit provided by this
chapter, a taxpayer shall:
(1) claim the credit on the taxpayer s annual state income or
premium tax return in the manner prescribed by the appropriate
commission; and
(2) file with the appropriate commission and with the taxpayer's
annual state income or premium tax return a copy of the form issued by
the corporation as to the qualified investment by the taxpayer, which
includes an undertaking by the taxpayer to report to the appropriate
commission any redemption of the qualified investment within the
meaning of Section 41-44-80."
Commission reference changed
SECTION 5. Section 41-44-100 of the 1976 Code is amended to read:
"Section 41-44-100. The corporation shall complete forms
prescribed by the appropriate commission which must show as to each
qualified investment in the fund:
(1) the name, address, and identification number of the taxpayer
who purchased a qualified investment; and
(2) the nature of the qualified investment purchased by the
taxpayer and the amount paid for it.
These forms must be filed with the appropriate commission on or
before the fifteenth day of the third month following the month in
which the qualified investment is purchased. Copies of the forms to
be provided to the appropriate commission must be mailed to the
taxpayer on or before the fifteenth day of the second month following
the month in which the qualified investment is purchased."
Heading changed
SECTION 6. The heading to Chapter 44, Title 41 of the 1976 Code
is amended to read:
"Palmetto Seed Capital Fund
Limited Partnership".
Applicability
SECTION 7. The provisions of Section 41-44-10(F), Section
41-44-90, and Section 41-44-100 of the 1976 Code, as amended by this
act, which make the tax credit provisions of Chapter 44 of Title 41
applicable to insurance premium taxes apply to insurance premium taxes
which accrue on and after January 1, 1990.
Time effective
SECTION 8. This act takes effect upon approval by the Governor.
Approved the 29th day of May, 1990.
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