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Regular Session, 2011
HOUSE BILL NO. 371
BY REPRESENTATIVE TUCKER
TAX CREDITS: Authorizes issuance of the Brownfields Investor Tax Credit to eligible
taxpayers
AN ACT1
To enact R.S. 47:6021.1, relative to tax credits; to authorize issuance of the Brownfields2
Investor Tax Credit to eligible taxpayers; to provide for the amount of the credit; to3
provide for eligibility; to provide for definitions; to provide for the tax credit4
application process; to authorize the recapture and recovery of the tax credit under5
certain circumstances; to authorize the transfer of tax credits; to provide relative to6
the applicable tax periods for which the credits may be granted or allowed; and to7
provide for related matters.8
Be it enacted by the Legislature of Louisiana:9
Section 1. R.S. 47:6021.1 is hereby enacted to read as follows: 10
ยง6021.1. Brownfields Investor Tax Credit; eligible taxpayers11
A.(1) Purpose. The primary objective of this Section is to stimulate12
environmental economic development in Louisiana by encouraging the cleanup,13
redevelopment, and productive reuse of Brownfields sites in the state. The14
legislature hereby finds and declares that unknown environmental liabilities are15
preventing communities, developers, and investors from restoring Brownfields16
properties to productive use and revitalizing impacted neighborhoods. Brownfields17
sites languish because developers, both public and private, face a daunting challenge18
in the form of exorbitant environmental site assessment study costs, followed by19
potentially even more expensive cleanup costs. Banks and other traditional financing20 HLS 11RS-547 ORIGINAL
HB NO. 371
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sources have been and remain reluctant to finance the costs involved in the initial1
assessment of Brownfields sites. These sites may have significant contamination but2
nonetheless retain strong development or redevelopment potential. Properties that3
were once used for industrial, manufacturing, or commercial uses are lying4
abandoned or under used due to the suspicion or actual knowledge of hazardous5
substance contamination. Additionally, the redevelopment of these properties into6
residential housing or for other uses that benefit the community by removing7
financial and environmental impediments to redevelopment will promote more8
affordable housing and better communities for citizens of this state.9
(2) In furtherance of that purpose, there is hereby established a tax structure10
which encourages private investment. This structure will provide for state11
participation in the form of tax credits to encourage investment in state-certified12
Brownfields site redevelopment.13
B. Definitions. The following terms shall have the following meanings for14
the purposes of this Section:15
(1) "Brownfields site" or "state-certified site" means an identified area of16
immovable property in the state for which a voluntary remediation action or a17
voluntary remedial investigation concerning the presence or potential presence of a18
hazardous substance or pollutant is authorized by the secretary pursuant to Part II of19
Chapter 12 of Subtitle II of Title 30 of the Louisiana Revised Statutes of 1950.20
(2) "Eligible taxpayer" means a local housing authority as defined in R.S.21
40:384, which contracts with a third-party developer or remediation contractor to22
redevelop a Brownfields site. An eligible taxpayer may transfer or sell a tax credit23
earned pursuant to the provisions of this Section.24
(3) "Investment" shall mean the expenditure for the voluntary remedial25
investigation or voluntary remediation of a Brownfields site by an eligible taxpayer.26
(4) "Responsible person" means responsible person or responsible landowner27
as those terms are defined in R.S. 30:2285.2. A responsible person shall not be an28
eligible taxpayer.29 HLS 11RS-547 ORIGINAL
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(5) "Voluntary remediation action" means risk-based cleanup of a voluntary1
remediation site performed in accordance with a voluntary remedial action plan2
approved by the secretary pursuant to Part II of Chapter 12 of Subtitle II of Title 303
of the Louisiana Revised Statutes of 1950.4
(5) "Voluntary remedial investigation" means the determination of the nature5
and extent of potential threats to human health and the environment through data6
collection and site characterization and the development of remedial action goals, all7
as authorized and approved by the secretary pursuant to Part II of Chapter 12 of8
Subtitle II of Title 30 of the Louisiana Revised Statutes of 1950.9
C. Investor tax credit; specific projects.10
(1)(a) There is hereby authorized a credit against state income tax for the11
investment by an eligible taxpayer in a voluntary remediation action or a voluntary12
remedial investigation as provided for in this Section, as follows:13
Except as provided for in Paragraph (2) of this Subsection:14
(i) Any eligible taxpayer who is the holder of investor tax credits shall be15
allowed a tax credit of fifteen percent of the total investment made in a voluntary16
remedial investigation at a state-certified site as provided for in this Section.17
(ii) Any eligible taxpayer who is the holder of investor tax credits shall be18
allowed a tax credit of fifty percent of the total investment made in a voluntary19
remediation action at a state-certified site as provided for in this Section.20
(b) A tax credit shall be earned by an eligible taxpayer at the time the21
expenditures are made in either a voluntary remedial investigation or voluntary22
remediation action; however, credits cannot be applied against a tax until the23
expenditures are certified by the secretary of the Department of Environmental24
Quality as provided for in Items (D)(2)(a)(ii) and (D)(2)(b)(ii) of this Section.25
(c) No credit shall be allowed under this Section for any expenditures for26
which an eligible taxpayer receives a credit, rebate, or other tax incentive granted by27
the state under any other provision of law.28 HLS 11RS-547 ORIGINAL
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(2) Tax credits associated with a state-certified site shall never exceed the1
total investment in such site.2
(3) The credit shall be allowed against the income tax for the taxable period3
in which the credit is earned as provided for in Paragraph (1) of this Subsection. If4
the tax credit allowed pursuant to this Section exceeds the amount of such taxes due,5
then any unused credit may be carried forward as a credit against subsequent tax6
liability for a period not to exceed ten years. In no event shall the amount of the tax7
credit applied by an eligible taxpayer in a taxable period exceed the amount of such8
taxes due from the eligible taxpayer for that taxable period.9
D. Review of applications; certification and administration.10
(1) Any voluntary remedial investigation application and voluntary11
remediation application for such tax credit shall be submitted to the Department of12
Environmental Quality. Such applications shall be provided by the Department of13
Environmental Quality pursuant to the provisions of Part II of Chapter 12 of Subtitle14
II of Title 30 of the Louisiana Revised Statutes of 1950, and regulations adopted15
pursuant thereto, and shall include a requirement that the applicant provide a16
statement of the projected economic development benefits to the community in17
which the project is located. Upon receipt of such application, the Department of18
Environmental Quality shall issue a site specific identification number. Such site19
identification number shall then be forwarded to the Department of Revenue. The20
Department of Environmental Quality shall determine whether the information21
furnished by the applicant is true and correct.22
(2)(a)(i) Upon approval by the secretary of the Department of Environmental23
Quality of a voluntary remedial investigation tax credit application, the applicant24
may proceed with his voluntary remedial investigation. Any such investigation shall25
be conducted according to Department of Environmental Quality oversight.26
(ii) After a satisfactory demonstration that the voluntary remedial27
investigation is complete, the Department of Environmental Quality shall approve28
the remedial investigation report and shall issue a certificate of completion to the29 HLS 11RS-547 ORIGINAL
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eligible taxpayer applicant and forward it to the secretary of the Department of1
Revenue.2
(b)(i) Upon approval by the secretary of the Department of Environmental3
Quality of a voluntary remediation tax credit application, the applicant may proceed4
with his voluntary remediation action.5
(ii) After satisfactory demonstration that the voluntary remediation action6
has been accomplished and the Department of Environmental Quality approves the7
voluntary remediation action report, the department shall issue a certificate of8
completion to the eligible taxpayer applicant and shall forward the same to the9
secretary of the Department of Revenue.10
(3) The secretary of the Department of Environmental Quality shall notify11
the secretary of the Department of Revenue within fifteen days after notice from an12
eligible taxpayer applicant where either a voluntary remedial investigation or a13
voluntary remediation action has been terminated. No further tax credit shall be14
allowed if either a voluntary remedial investigation or a voluntary remediation action15
is terminated.16
E. Application of the credit.17
(1)(a) All entities taxed as corporations for Louisiana income tax purposes18
shall claim any credit allowed under this Section on their corporation income tax19
return.20
(b) Individuals, estates, and trusts shall claim any credit allowed under this21
Section on their income tax returns.22
(2) Entities not taxed as corporations shall claim any credit allowed under23
this Section on the returns of the partners or members as follows:24
(a) Corporate partners or members shall claim their share of the credit on25
their corporate income tax returns.26
(b) Individual partners or members shall claim their share of the credit on27
their individual income tax returns.28 HLS 11RS-547 ORIGINAL
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(c) Partners or members that are estates or trusts shall claim their share of the1
credit on their fiduciary income tax returns.2
(3) Certification of completion shall be remitted with any income tax return3
on which a credit is claimed.4
(4) The secretary of the Department of Environmental Quality shall be5
responsible for the submission of the initial certification of a voluntary remedial6
investigation and the final certification of completion of voluntary remediation7
action on a state-certified Brownfields site together with the year of completion;8
taxpayer identification number; type of credit, either voluntary remedial9
investigation or voluntary remediation action; and the certified total expenditures to10
the secretary of the Department of Revenue.11
(5) The Department of Environmental Quality and the Department of12
Revenue shall promulgate such rules and regulations as are necessary to carry out the13
intent and purposes of this Section in accordance with the general guidelines14
provided herein.15
F. Recapture of credits. If the secretary of the Department of Environmental16
Quality or the secretary of the Department of Revenue finds that funds for which an17
eligible taxpayer received credits according to this Section are not invested in and18
expended with respect to a state-certified investigation or remediation, then the19
eligible taxpayer's state income tax for such taxable period shall be increased by such20
amount necessary for the recapture of the credit provided by this Section. Any21
eligible taxpayer applying for the credit shall be required to reimburse the22
Department of Environmental Quality for audits or expenses related to recapture of23
credits.24
G. Recovery of credits by the Department of Revenue.25
(1) Credits previously granted to an eligible taxpayer may be recovered by26
the secretary of the Department of Revenue through any collection remedy27
authorized by R.S. 47:1561.28 HLS 11RS-547 ORIGINAL
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(2) The only interest that may be assessed and collected on recovered credits1
is interest at a rate three percentage points above the rate provided in R.S.2
9:3500(B)(1), which shall be computed from the original due date of the return on3
which the credit was taken.4
H. Ineligible participants. No corporation or partnership including any5
company owned, affiliated, or controlled, in whole or in part, by any company or6
person that is a responsible person or is in default on a loan made by the state or a7
loan guaranteed by the state, or any company or person who has ever declared8
bankruptcy under which an obligation of the company or person to pay or repay9
public funds or monies was discharged as a part of such bankruptcy, shall be eligible10
to receive any tax credit authorized under this Section. In addition, no responsible11
person shall be eligible to receive any tax credit pursuant to this Section.12
I. Transferability of the credit. Any tax credits provided for in this Section13
not previously claimed by an eligible taxpayer against its income tax may be14
transferred or sold to another Louisiana taxpayer, subject to the following conditions:15
(1) A single transfer or sale may involve one or more transferees. The16
transferee of the tax credits may transfer or sell such tax credits subject to the17
conditions of this Subsection.18
(2) Transferors and transferees shall submit to the Department of Revenue19
in writing, a notification of any transfer or sale of tax credits within thirty days after20
the transfer or sale of such tax credits. The notification shall include the transferor's21
tax credit balance prior to transfer, a copy of any tax credit certification letter(s)22
issued by the Department of Environmental Quality, the name of the state-certified23
site, the transferor's remaining tax credit balance after transfer, all tax identification24
numbers for both transferor and transferee, the date of transfer, the amount25
transferred, a copy of the credit certificate, price paid by the transferee to the26
transferor for the tax credits, and any other information required by the Department27
of Revenue. For the purpose of reporting transfer prices, the term "transfer" shall28
include allocations as provided in R.S. 47:6007(C)(3) and by rule.29 HLS 11RS-547 ORIGINAL
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(3) Failure to comply with this Paragraph will result in the disallowance of1
the tax credit until the taxpayers are in full compliance.2
(4) The transfer or sale of this credit does not extend the time in which the3
credit can be used. The carry forward period for a credit that is transferred or sold4
begins on the date on which the credit was originally earned.5
(5) To the extent that the transferor did not have rights to claim or use the6
credit at the time of the transfer, the Department of Revenue shall either disallow the7
credit claimed by the transferee or recapture the credit from the transferee through8
any collection method authorized by R.S. 47:1561. The transferee's recourse is9
against the transferor.10
(6) The transferee shall apply such credits in the same manner and against11
the same taxes as the eligible taxpayer originally awarded the credit.12
J. The provisions of this Section shall be applicable to all taxable periods13
beginning on and after January 1, 2012. No tax credits shall be granted pursuant to14
the provisions of this Section after December 31, 2015; however, the transferability15
provisions of Subsection (I) of this Section shall continue to be effective after16
December 31, 2015, for tax credits authorized prior to such date.17
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
Tucker HB No. 371
Abstract: Authorizes the issuance of the Brownfields Investor Tax Credit to eligible
taxpayers for taxable periods beginning on Jan. 1, 2012, and ending Dec. 31, 2015.
Tax credits may be earned through investment in a voluntary remedial investigation
or a voluntary remedial action at a state-certified site.
Proposed law authorizes an income tax credit for the investment by an eligible taxpayer in
a voluntary remediation action or investigation for the cleanup, redevelopment, and
productive reuse of Brownfields sites in La.
Proposed law provides that the amount of the credit shall be 15% of the total investment
made in a voluntary remedial investigation at a state-certified site or 50% of the total
investment made in a voluntary remediation action at a state-certified site. Further provides
that the amount of the tax credit shall never exceed the total investment in such site. HLS 11RS-547 ORIGINAL
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Proposed law defines an eligible taxpayer as a local housing authority, as defined in present
law, which contracts with a third-party developer or remediation contractor to redevelop a
Brownfields site. An eligible taxpayer may transfer or sell a tax credit earned pursuant to
proposed law.
Proposed law provides that the credit shall be allowed against the income tax for the taxable
period in which the credit is earned. Further, provides that if the amount of the tax credit
exceeds the amount of the eligible taxpayer's tax liability, then any unused credit may be
carried forward as a credit against subsequent tax liability for a period not to exceed 10
years.
Proposed law provides for the tax credit application process, the recapture of credits, the
recovery of credits, and for the transferability of credits.
Proposed law provides that the provisions of proposed law shall be applicable to all taxable
periods beginning on and after Jan. 1, 2012. No tax credits shall be granted after Dec. 31,
2015; however, the transferability provisions of proposed law shall continue to be effective
after Dec. 31, 2015, for tax credits authorized prior to such date.
(Adds R.S. 47:6021.1)