AB 1399 Summary

• Establishes California New Markets Tax Credit Program providing tax credits to corporations, individuals, and insurers for investments in low-income communities for taxable years 2015-2026, modeled on federal New Markets Tax Credit under Section 45D of Internal Revenue Code.

• Limits annual credit allocation to $40,000,000 and cumulative total allocation to $200,000,000, with amount determined by unused exclusions from sales and use tax programs and administered by Governor's Office of Business and Economic Development (GO-Biz) and California Competes Tax Credit Committee.

• Modifies federal credit structure to allow 0% credit for first two years, 7% for third year, and 8% for remaining years; restricts eligible businesses to those with 250 or fewer employees in California low-income communities with specified poverty rates or unemployment thresholds.

• Requires community development entities receiving allocations to invest at least 15% in partnership with uncertified CDEs or GO-Biz-certified nonprofits, conduct positive revenue impact assessments, and submit detailed annual reporting on job creation, business assistance, and community outcomes.

• Establishes California New Markets Tax Credit Fund and requires GO-Biz to collect reasonable application and administrative fees; credits only allowed in years Legislature appropriates funds; program sunsets December 1, 2028.