Monday, February 24, 2014
(NASHVILLE), The Senate has approved legislation, sponsored by Senators Bill Ketron (R-Murfreesboro) and Doug Overbey (R-Maryville), that provides greater accountability and transparency in the state’s TNInvestco Program. TNInvestco is a program administered by the Tennessee Department of Economic and Community Development (EDC) that provides benefits to small, medium-sized, and start-up businesses to encourage job growth in the state.
“This legislation will provide greater oversight and ensure that companies receiving tax credits are completing their statutorily required investment strategy scorecards,” said Senator Ketron. “It also helps to ensure investment strategy benchmarks are being met and that investments are free from fraud, waste, and abuse.”
“The overwhelming majority of jobs in this state are created by small businesses,” said Senator Overbey. “This bill helps to ensure that entrepreneurs have access to capital in order to grow jobs, but that it is done in an accountable and transparent manner.”
Some of the key provisions included in Senate Bill 766 are:
• requires the department to obtain sufficient documentation to support the state’s profit share percentage;
• changes the date through which the TNInvestcos submit their information in the annual report to provide better accuracy of investment activity for the calendar year;
• changes the number of days that a TNInvestco has to submit their annual audited financial statements from 180 days to 120 days so that information is received in a more timely fashion;
• changes the number of days that the TNInvestco has to cure any areas of non-compliance from 60 days to 45 days to ensure that policies and procedures are being met without substantive delays;
• allows ECD to promulgate rules and regulations to ensure compliance with requirements of the program; and
• gives ECD greater enforcement capability by allowing them to assess a penalty for persistent non-compliance by a TNInvestco.
The bill also allows a TNInvestco to re-invest their returns and the state’s returns in equal portions up to the 7th anniversary of the fund. Finally, it adds new language to the law that requires ECD to liquidate all remaining ownership interests by the state beginning December 31, 2021.