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2005 Session

Budget Amendments - SB700 (Conference Report)

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Community Development Financial Institution and New Market Tax Credits

Item 112.10 #2c

Item 112.10 #2c

First Year - FY2005 Second Year - FY2006
Commerce And Trade
Housing and Community Development, Department of FY2005 $0 FY2006 $600,000 GF

Language
Page 99, line 2, strike "$18,623,000" and insert "$19,223,000".
Page 99, strike lines 5 through 55, and insert:
A.1.
Out of the amounts for Economic and Community Development Services shall be provided $500,000 the second year from the general fund to establish a community development financial institution to provide business and housing loans in distressed communities and to distressed populations.
2.  Notwithstanding the provisions of Title 59.1, Chapter 22.1, Code of Virginia, the Director, Department of Business Assistance, shall transfer all assets of the Virginia Economic Development Revolving Fund to a community development financial institution at such time as the eligible community development financial institution is legally established to do business within the Commonwealth.  Such transferred funds shall be used for the purpose of providing a portion of the initial capitalization for a community development bank or credit union subject to oversight by the appropriate federal or state regulatory and insurance agencies and eligible for certification by the U. S. Department of the Treasury as a community development financial institution.
3.  The Director, Department of Housing and Community Development, shall transfer $7,500,000 in existing loans and funds from the Commonwealth Priority Housing Fund to a community development financial institution at such time as the eligible community development financial institution is legally established to do business within the Commonwealth.  Such transferred funds shall be used for the purpose of providing a portion of the initial capitalization for a community development bank or credit union subject to oversight by the appropriate federal or state regulatory and insurance agencies and eligible for certification by the U.S. Department of the Treasury as a community development financial institution.
4.  The purpose of the community development bank or credit union capitalized in part through the transfer of funds authorized in subparagraphs 2 and 3 shall be to leverage the Commonwealth's capital contribution and other capital that may be provided from other sources to provide a source of targeted lending and investment for economic development and housing activities within distressed communities and populations throughout the Commonwealth.  
As a condition of appropriation for this item, the Director shall provide the Chairmen of the Senate Finance and House Appropriations Committees a draft of the articles of incorporation or organization, charters, mission statements, or any other document needed to establish the community development bank for review and comment.
5.  The Director, Department of Housing and Community Development, and another appointee of the Governor shall serve as members of the board of directors of the community development bank or credit union capitalized in part through the transfer of funds authorized in subparagraphs 2 and 3.
B. Out of the amounts for Economic and Community Development Services shall be provided $100,000 the second year from the general fund to support increased access to New Market tax credits, a federal program designed to stimulate private investment in distressed communities.  The Department of Housing and Community Development will provide targeted assistance to organizations pursuing credit allocations; to communities that have eligible development activities; and to businesses and developers of community development projects for the purpose of increasing the number of Virginia organizations receiving allocations from the federal government and the projects in distressed communities that are able to use tax credits as part of their financing packages."
Page 100, strike lines 1 through 58.
Page 101, strike lines 1 through 59.
Page 102, strike lines 1 through 59.
Page 103, strike lines 1 through 29.


Explanation
(This amendment provides funding to support the development of a new community development financial institution and to access federal new market tax credits.)