A BILL TO BE ENTITLED
AN ACT To Conform Certain North carolina Tax Credits to the Federal New Markets Tax Credit.
The General Assembly of North Carolina enacts:
SECTION 1.  G.S. 105‑129.70 reads as rewritten:
"§ 105‑129.70  Definitions.
The following definitions apply in this Article:
(1)	Additionally distressed area. – An area that meets one of the criteria in sub-subdivisions a. through c. below, or, if the area is in a census tract with a poverty rate greater than twenty percent (20%), one of the criteria in sub-subdivisions d. through h. below:
a.	It is in a census tract with poverty rates greater than thirty percent (30%).
b.	It is in a census tract with, if located within a non‑Metropolitan Area, median family income that does not exceed sixty percent (60%) of statewide median family income, or, if located within a Metropolitan Area, median family income that does not exceed sixty percent (60%) of the greater of the statewide median family income or the Metropolitan Area median family income.
c.	It is in a census tract with an unemployment rate at least 1.5 times the national average.
d.	It is in a census tract with one of the following: (i) if located within a non‑Metropolitan Area, median family income that does not exceed seventy percent (70%) of statewide median family income, or, if located within a Metropolitan Area, median family income that does not exceed seventy percent (70%) of the greater of the statewide median family income or the Metropolitan Area median family income; or (ii) an unemployment rate at least 1.25 times the national average.
e.	It is a federally designated Empowerment Zone, Enterprise Community, or Renewal Community.
f.	It is designated by the United States Small Business Administration as a HUB Zone to the extent the development will support businesses that obtain HUB Zone certification from the United States Small Business Administration.
g.	It is a brownfield site as defined under Part 5 of Article 9 of Chapter 130A of the General Statutes.
h.	It is located in a development tier one or development tier two area as defined by G.S. 143B‑437.08, or an urban progress zone as defined by  G.S. 143B‑437.09.(1a)	Certified historic structure. – Defined in section 47 of the Code.
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SECTION 2.  G.S. 105‑129.71 reads as rewritten:
"§ 105‑129.71.  Credit for income‑producing rehabilitated mill property.
(a)	Credit. – A taxpayer who is allowed a credit under section 47 of the Code for making qualified rehabilitation expenditures of at least three million dollars ($3,000,000) with respect to a certified rehabilitation of an eligible site is allowed a credit equal to a percentage of the expenditures that qualify for the federal credit. The credit may be claimed in the year in which the eligible site is placed into service. When the eligible site is placed into service in two or more phases in different years, the amount of credit that may be claimed in a year is the amount based on the qualified rehabilitation expenditures associated with the phase placed into service during that year. In order to be eligible for a credit allowed by this Article, the taxpayer must provide to the Secretary a copy of the eligibility certification and the cost certification. The amount of the credit is as follows:
(1)	For an eligible site located in a development tier one or two area, determined as of the date of the eligibility certification, or in an additionally distressed area, the amount of the credit is equal to forty percent (40%) of the qualified rehabilitation expenditures.
(2)	For an eligible site located in a development tier three area, determined as of the date of the eligibility certification, the amount of the credit is equal to thirty percent (30%) of the qualified rehabilitation expenditures.
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SECTION 3.  G.S. 105‑129.72 reads as rewritten:
"§ 105‑129.72.  Credit for nonincome‑producing rehabilitated mill property.
(a)	Credit. – A taxpayer who is not allowed a federal income tax credit under section 47 of the Code and who makes rehabilitation expenses of at least three million dollars ($3,000,000) with respect to a certified rehabilitation of an eligible site is allowed a credit equal to a percentage of the rehabilitation expenses. The entire credit may not be taken for the taxable year in which the property is placed in service, but must be taken in five equal installments beginning with the taxable year in which the property is placed in service. When the eligible site is placed into service in two or more phases in different years, the amount of credit that may be claimed in a year is the amount based on the rehabilitation expenses associated with the phase placed into service during that year. In order to be eligible for a credit allowed by this Article, the taxpayer must provide to the Secretary a copy of the eligibility certification and the cost certification. For an eligible site located in a development tier one or two area, determined as of the date of the eligibility certification, or in a census tract that is an additionally distressed area, the amount of the credit is equal to forty percent (40%) of the rehabilitation expenses. No credit is allowed for a site located in a development tier three area.
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SECTION 4.  This act is effective when it becomes law.