(e) The tax credit created in this section is not allowed to any qualified applicant unless at least one qualified global film festival entity commences the relocation of the festival to Colorado by January 1, 2026. The office shall determine if the relocation requirement of this subsection (3)(e) is satisfied and notify the department.
(4) (a) Subject to the program policies and procedures established by the office, a global film festival entity or an existing or small Colorado film festival entity may be allowed a tax credit for each tax year in which the global film festival entity or existing or small Colorado film festival entity hosts a film festival in Colorado. A global film festival entity or an existing or small Colorado film festival entity may be allowed an additional tax credit in the subsequent tax year with respect to any qualified expenditures incurred in that year.
(b) For purposes of this section, when determining the amount of tax credit for which a global film festival entity or existing or small Colorado film festival entity is eligible, any qualified expenditure that occurred in the eleven months prior to the commencement of a tax year in which the film festival entity hosted a film festival in Colorado may be added to the qualified expenditures that occurred during the tax year in which the film festival entity hosted a film festival in Colorado.
(c) Only one credit is allowed in accordance with this section with respect to a qualified expenditure.
(5) (a) The office shall develop and publish program policies and procedures for the administration of this section, including application guidelines for a global film festival entity and for an existing or small Colorado film festival entity applying to receive a tax credit reservation or issuance under this section. The office may include guardrails or requirements that the applicant must satisfy before a tax credit reservation or issuance occurs.
(b) When determining the priority and amount of a reservation of a tax credit for an existing or small Colorado film festival entity, if there are more requests for tax credit reservations than there are reservations available, the office must provide priority to existing or small Colorado film festival entities according to a competitive evaluation. The office shall evaluate applications based on the following criteria and shall prioritize applications from an entity that:
(I) Faces a substantial market or environmental change that demonstratively impacts the ongoing viability of the entity and is outside of the entity's control;
(II) Demonstrates historic community and economic impact, with special consideration being given to an entity that has run a festival for more than ten years;
(III) Demonstrates innovation and uniqueness;
(IV) Increases geographic equity; or
(V) Demonstrates community support through letters of recommendation including, but not limited to, letters that include demonstrations of historic and economic impact from:
(A) A local elected official, such as a mayor; or
(B) A local governing body, such as a city council or board of county commissioners.
(6) (a) For a global film festival entity to claim a tax credit pursuant to subsection (3) of this section, the global film festival entity must apply to the office for the reservation of a tax credit at a time and in a manner determined in the program policies and procedures. A global film festival entity may request reservations of tax credits in an amount up to thirty-four million dollars in accordance with subsection (3) of this section. The application must include a statement of intent by the global film festival entity to organize a festival in Colorado. The global film festival entity must submit, in conjunction with the application, any documentation necessary to demonstrate that it meets the definition of a global film festival entity, as defined in subsection (2)(a) of this section, and any other information required by the office. If the office is making a multi-year tax credit reservation, it shall document the multi-year tax credit reservation in a written tax credit agreement.
(b) The office shall review each tax credit reservation application submitted by a global film festival entity and, based on the information provided in the application, the office shall make a determination of whether the global film festival entity will receive a tax credit reservation and the amount of that reservation. The office must establish and provide written notice to the global film festival entity of the minimum festival operating requirements as part of the reservation process for the global film festival entity to receive a tax credit, which may include, but are not limited to, the number of films required to be screened, the marketing budget, the length of the festival in days, the location of the festival, the time during the year when the festival is required to take place, and other guardrails as determined by the office.
(c) Upon completion of the qualified expenditures, a global film festival entity that received a tax credit reservation from the office must retain a certified public accountant licenced to practice in the state or a certified public accounting firm that is registered in the state to review and report in writing, and in accordance with professional standards, regarding the accuracy of the financial documents that detail the expenses incurred in the course of the organization of the film festival in Colorado. The certified public accountant's written report must include documentation of the global film festival entity's qualified expenditures. This report must also show which qualified expenditures occurred within Colorado and which occurred outside Colorado according to standards developed by the office.
(d) A global film festival entity shall apply to the office for tax credit issuance in accordance with the program policies and procedures.
(e) When the office is satisfied that the global film festival entity is eligible for a refundable tax credit, the office shall issue to the global film festival entity a tax credit certificate that evidences the global film festival entity's right to claim the tax credit allowed under subsection (3) of this section. The amount of the tax credit is the lesser of the qualified expenditures calculated pursuant to subsection
(4) of this section or the amount of the tax credit reserved pursuant to subsection
(6)(b) of this section. The tax credit certificate must include the taxpayer's name, the taxpayer's social security number or federal employer identification number, the approved tax credit amount, and the income tax year for which the tax credit is being allowed.
(7) (a) An existing or small Colorado film festival entity may apply to the office for the reservation of a tax credit at a time and in a manner determined by the office and published in the program policies and procedures. An existing or small Colorado film festival entity may request a reservation of a tax credit for up to five hundred thousand dollars or another maximum amount as determined by the office. The application must include a statement of intent by the existing or small Colorado film festival entity to organize a festival in Colorado.
(b) The office shall review each application for a tax credit reservation submitted by an existing or small Colorado film festival entity and, based on the information provided in the application, the office shall make a determination of whether the existing or small Colorado film festival entity will be eligible to receive a tax credit and the amount of the tax credit reservation that will be granted to the existing or small Colorado film festival entity. The office shall inform the existing or small Colorado film festival entity in writing as to whether it has approved or denied the application for a tax credit reservation, the amount of the reservation if approved, and the years of the reservation. If the office is making a multi-year tax credit reservation, it shall document the multi-year tax credit reservation in a written conditional agreement. The office may establish and provide written notice to the existing or small Colorado film festival entity of the minimum festival operating requirements as part of the reservation process for the existing or small Colorado film festival entity to receive a tax credit which may include, but are not limited to, the number of films required to be screened, the marketing budget, the length of the festival in days, the location of the festival, the time during the year when the festival is required to take place, and any other guardrails as determined by the office.
(c) Upon completion of the qualified expenditures, an existing or small Colorado film festival entity that received approval for a tax credit reservation from the office must retain a certified public accountant licenced to practice in the state or a certified public accounting firm that is registered in the state to review and report in writing, and in accordance with professional standards, regarding the accuracy of the financial documents that detail the expenses incurred in the course of the organization of the film festival in Colorado. The certified public accountant's written report must include documentation of the existing or small Colorado film festival entity's qualified expenditures. This report must also show which qualified expenditures occurred within Colorado according to standards developed by the office.
(d) The existing or small Colorado film festival entity shall apply to the office for tax credit issuance in accordance with the program policies and procedures.
(e) When the office is satisfied that an existing or small Colorado film festival entity is eligible for a tax credit, the office shall issue to the existing or small Colorado film festival entity a refundable tax credit certificate that evidences the existing or small Colorado film festival entity's right to claim the tax credit allowed under subsection (3) of this section. The amount of the tax credit is the lesser of the qualified expenditures calculated pursuant to subsection (4) of this section or the amount of the tax credit reserved pursuant to subsection (7)(b) of this section. The tax credit certificate must include the taxpayer's name, the taxpayer's social security number or federal employer identification number, the approved tax credit amount, and the calendar year for which the tax credit is being allowed.
(8) If a credit authorized by this section exceeds the income tax due on the income of the qualified global film festival entity or existing or small Colorado film festival entity, or the entity is a tax-exempt entity under section 501 (c)(3) of the internal revenue code that does not pay Colorado state income taxes, the excess tax credit may not be carried forward and one hundred percent of the unclaimed value of the tax credit shall be refunded by the department to the film festival entity. A tax-exempt entity shall file a return pursuant to section 39-22-601 (7)(b).
(9) This section is repealed, effective December 31, 2041.
