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Bill to align CDFI credit calculations and expand eligibility gets narrow committee defeat
Summary
SB 2151 would change how Community Development Financial Institution tax credits are calculated (from December 31 snapshot to month-end averages) and make certain insurance companies eligible to claim credits; the committee voted 3–2 to report it with a negative recommendation.
Senator Wally told the committee SB 2151 makes two targeted changes to the Tennessee community investment tax credit for franchise and excise taxpayers: it aligns the CDFI annual credit calculation with the housing development agency's month-end average unpaid balance method and it expands eligibility to ensure certain insurance companies could claim the credit.
Wally said the change would update the calculation method ‘‘so instead of December 31 snapshot, what this bill would do would update the CDFI credit to use the same month end average as the housing development agency annual calculation.’’ Committee staff explained fiscal review expects the change to maximize the loan base used to generate credits and consequently decrease tax revenue; the committee recorded a close vote and reported the bill with a negative recommendation (3 ayes, 2 noes).
Wally noted subject-matter experts would be available in full finance to address technical questions; committee members signaled this is a technically detailed change that will require further review in subsequent committee hearings.
