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Relating to the decertification of a certified capital company.
No significant fiscal implication to the State is anticipated.
SB 1017 would add a subsection to Section 228.302 of the Insurance Code. Specifically, this legislation adds Subsection C-1, which would allow the comptroller to decertify a certified capital company (CCC). A CCC could only be decertified if it notifies the comptroller in writing that it has invested 100 percent of the company’s certified capital.
The Certified Capital Company Program (CAPCO) is an economic development program that was established in 2001 by the state legislature. To date, it has administered nearly $400 million. The Texas Treasury Safekeeping Trust Company (TSTC) manages the program and the comptroller of Texas is the only director and shareholder of it.
CAPCO operates as a venture capital program and it is funded through Insurance Premium Tax Credits (IPTCs).
The legislature approved $200 million in IPTCs in 2003 to CAPCO called Program One. In 2007, the legislature approved another $200 million in IPTCs to CAPCO called Program Two. The comptroller has invested all of the money from Program One, but Program Two still has funds to dispense.
Current law does not allow the comptroller to decertify a program under CAPCO. Even though Program One has dispensed all of its funds and is no longer operative, it still must undergo an annual audit and must refile paperwork with the government.
SB 1017 would allow the Comptroller to decertify a CAPCO, once the program has invested 100 percent of its capital funds, so that it no longer has to follow through with unnecessary government requirements for a Program that no longer operating.
For these reasons, we stand neutral on SB 1017 because it does not affect our liberty principles.