2006 Kansas Code - 74-99c09

      74-99c09.   Kansas community entrepreneurship fund; creation; credits and expenditures; oversight and management; tax credits authorized for cash donations, limitations, administration, reimbursement of center for costs; criteria for fund distributions. (a) The Kansas community entrepreneurship fund is hereby created in the state treasury to which shall be credited any state or other funds specifically so designated. The secretary may budget moneys to the Kansas community entrepreneurship fund from the economic development initiatives fund subject to appropriations. The secretary also shall credit the fund with gifts, donations, investments or grants received from any source for the center, some of which shall qualify for the income tax credit allowed pursuant to this section and amendments thereto. All expenditures from such fund shall be made upon warrants of the director of accounts and reports pursuant to vouchers approved by the president of the center or by a person or persons designated by the president of the center.

      (b)   The state treasurer shall credit all revenue collected or received by the center to the fund. On or before the 10th day of each month, the director of accounts and reports shall transfer from the state general fund to the Kansas community entrepreneurship fund interest earnings based on:

      (1)   The average daily balance of moneys in the Kansas community entrepreneurship fund for the preceding month; and

      (2)   the net earnings rate of the pooled money investment portfolio for the preceding month. Expenditures from the fund shall be made only for the purposes of this act. Moneys in the fund shall not be subject to further legislative appropriation acts.

      (c)   Oversight and management of the fund shall be provided by the Kansas center for entrepreneurship under guidelines developed and implemented with the approval of the secretary.

      (d)   A credit against the tax imposed by the Article 32, Chapter 79 of the Kansas Statutes Annotated on the Kansas taxable income of an investor and against the tax imposed by K.S.A. 40-252, and amendments thereto, shall be allowed for a cash donation in the Kansas community entrepreneurship fund. The credit shall be a total maximum amount equal to 50% of an investor's cash donation in the Kansas community entrepreneurship fund, subject to the limitation set forth. This tax credit may be used in its entirety in the taxable year in which the cash donation is made, except that, no tax credit shall be allowed in a year prior to 2006. If the amount by which that portion of the credit allowed by this section exceeds the investor's liability in any one taxable year, beginning in the year 2006, the remaining portion of the credit may be carried forward until the total amount of the credit is used. If the investor is a corporation having an election in effect under subchapter S of the federal internal revenue code or a partnership, the credit provided by this section shall be claimed by the shareholders of these corporations or the partners of a partnership in the same manner as these shareholders or partners account for their proportionate shares of the income or loss of these corporations or partnerships.

      (e)   The secretary of revenue shall not allow tax credits of more than $50,000 that are attributable to an individual investor of cash donations in the Kansas community entrepreneurship fund each year. In no event shall the total amount of tax credits allowed under this section exceed $2,000,000 for any one fiscal year.

      (f)   The Kansas center for entrepreneurship shall be reimbursed for the reasonable costs of the administration of this act and for the processing, issuance and costs incurred in authorizing tax credits from the Kansas community entrepreneurship fund.

      (g)   The Kansas center for entrepreneurship, along with the department, shall develop a system for application for registration of an authorization of tax credits authorized pursuant to this act and shall control distribution of all tax credits to investors pursuant to this act. The Kansas center for entrepreneurship, along with the department, shall also develop rules for the administration of and disbursements from the Kansas community entrepreneurship fund.

      (h)   The Kansas community entrepreneurship fund shall be distributed to regional or local community seed capital funds or economic development agencies based on the following criteria: (1) The organization can provide a 40% match; (2) the organization provides a plan that assures grant funds will be used as seed capital for qualified entrepreneurs; (3) the grant will be used in a distressed or rural community and (4) other criteria as deemed necessary by the Kansas center for entrepreneurship.

      History:   L. 2004, ch. 112, § 63; July 1.