AB 566

Bill Subjects

Abstract

(1) Existing law requires each admitted insurer with annual premiums written in California equal to or in excess of $100,000,000 for any reporting year to provide information to the Insurance Commissioner by July 1, 2016, on all of its community development investments, community development infrastructure investments, and green investments, as defined, in California. Existing law requires this information to be provided as part of the filing of periodic financial statements required by existing law, through a data call, or through other means as determined by the commissioner. Existing law requires the commissioner, by July 1, 2016, to provide specified information on the department's Internet Web site regarding aggregate insurer community development investments and community development infrastructure investments, actions taken by COIN to analyze that data, the aggregate amount of California public debt purchased by insurers, the aggregate amount of identified California investments, as defined, and the aggregate amount of California insurer investments in green investments. This bill would instead require each admitted insurer described above to report that information between June 1, 2018, and July 1, 2018, for the reporting years of 2016 and 2017. The bill would require the information to be reported only through a data call. The bill would instead require the commissioner to provide the information described above no sooner than July 1, 2019, and no later than December 31, 2019. The bill would require the commissioner to convene a task force to study and evaluate strategies to increase investment by insurers in low- to moderate-income communities in the state, to review the effectiveness of COIN and make recommendations regarding its modification, expansion, or replacement, and make recommendations regarding the establishment of a clearinghouse for COIN-eligible investments. The bill would require the task force's recommendations to be reported to the Legislature no sooner than July 1, 2019, and no later than December 31, 2019. (2) Existing law authorizes the commissioner to obtain information from insurers through various means, including an examination of the business and affairs of the insurer, or by the issuance of subpoenas or subpoenas duces tecum for witnesses to attend, testify, and produce documents before him or her on any subject touching insurance business or in the aid of his or her duties, as specified. This bill would authorize the commissioner to initiate a data call by bulletin upon reasonable notice to any class of insurers if the data call directly relates to specified subjects. The bill would authorize the commissioner to initiate a data call on other subjects only through an adopted regulation. The bill would require the commissioner to limit the subject of data calls to activity within the state, and would prohibit the commissioner from initiating a data call to obtain information that is otherwise available through other specified means. (3) Existing law imposes an annual tax on the gross premiums of an insurer, as defined, doing business in this state at specified rates. Existing law, until January 1, 2017, allows a credit under the Personal Income Tax Law, the Corporation Tax Law, and a credit against the tax imposed on an insurer in an amount equal to 20% of a qualified investment, as defined, made in a community development financial institution, as defined, but not to exceed, in the aggregate amount under all those laws, $50,000,000 per year and authorizes the California Organized Investment Network to certify investments for the credit until January 1, 2017. Existing law provides that if a qualified investment is reduced before the end of the 60th month, but not below $50,000, an amount equal to 20% of the total reduction for the year shall be added to the tax imposed on the taxpayer. Existing law also provides that if a qualified investment is withdrawn before the end of the 60th month and not reinvested in another community development financial institution within 60 days, the entire amount of any credit previously allowed for that taxable year is required to be added to the tax imposed on the taxpayer. These provisions are repealed on December 1, 2017. This bill would establish similar credits under the Personal Income Tax Law, the Corporation Tax Law, and the tax imposed on an insurer for taxable years or years, as applicable, beginning on or after January 1, 2017, and before January 1, 2022. The bill would, as compared to the tax credit that expired on January 1, 2017, require priority for the tax credit to be given to insurance company investors over all other tax credit investors and would instead require that the provision regarding withdrawal, without reinvestment, of a qualified investment also apply when a qualified investment is reduced. The bill would repeal these provisions on December 1, 2022.