Texas Senate Bill SB1744

Texas 2011 - 82nd Regular

• Out of Senate Committee: 4/11/11
• Introduced: 3/11/11
• Voted on by Senate: 4/21/11
• Refer: 3/23/11
• Out of House Committee: 4/29/11
• Report Pass: 4/11/11
• Engrossed: 4/21/11
• Report Pass: 4/29/11

Caption

Relating to the certification of a certified capital company.

Impact

The legislation amends the Insurance Code, specifically introducing measures that enable the Texas comptroller to handle decertifications efficiently. In doing so, the bill seeks to maintain oversight while easing certain regulatory burdens, which can enhance operational efficiency for certified capital companies. Removing the recapture and forfeiture of premium tax credits post-decertainment will likely appeal to companies, thus fostering a more conducive environment for capital investment.

Summary

Senate Bill 1744 focuses on the structure around certified capital companies in Texas, allowing for voluntary decertification by these companies. Under the proposed law, a certified capital company might request decertification if it has made qualified investments equaling its certified capital amount. Such flexibility is intended to encourage financial adaptability among these companies, especially as investment conditions evolve over time. By providing an exit option, the bill aims to make the certification process more responsive to market realities.

Contention

While the bill is viewed positively by some as a means of fostering economic growth and providing more control to capital companies, there could be concerns over the implications of relaxed oversight. Opponents might argue that allowing voluntary decertification without stringent checks could create loopholes for companies to exploit tax credits for which they are not deserving. This change in the legislation could, hence, erode the foundational purpose of the certification system, which aims to ensure that capital companies genuinely contribute to investment activities in the state.