National Coalition for Capital Applauds Tennessee Legislature for Passing “One of a Kind” Small Business Investment Legislation

Tennessee Small Business Investment Company Credit Act was passed and was supported by the National Coalition for Capital:

The National Coalition for Capital applauds the 106th Tennessee General Assembly for its overwhelming bi-partisan support of HB 2085 and SB 1203 – the Tennessee Small Business Investment Company Credit Act (TSBICCA).

The House version of the bill passed 94-0 (1 pass) and in the Senate, it garnered similar support – passing 30 –0.

“This bill is truly a one-of-a-kind model that directly addresses two critical economic development issues – growing small businesses and creating jobs,” said Ben Dupuy, Executive Director of the National Coalition for Capital. “Access to capital is critical for small and emerging companies, and with this legislation, Tennessee has jumped ahead of the pack.”

TSBICCA or TNInvestco, called a “model piece of legislation” by co-sponsor Senator Doug Overbey (R-Maryville), authorizes tax incentives for private investors to create a pool of capital totaling $120 million.  The fund will be divided among professional Tennessee based investment firms, which will then invest the money into small businesses that are located and headquartered in Tennessee. In addition to the immediate economic benefit of capital for small businesses – the state will share in half of all the investment returns, after covering costs.

As Senator Overbey pointed out in committee hearings, start-up and smaller businesses are often overlooked by venture firms, even though most jobs in the state are created by small businesses. Rep. Gerald McCormick (R-Chattanooga) said, “This bill may be the most important bill we pass, long-term, this year in the legislature.  This is going to provide a competitive advantage for us compared to the east coast and west coast in the venture capital area and is going to pay off in the long run for the citizens of this state.”

“Banks are not typically loaning to early stage businesses with little or no track record or collateral, and many venture capital firms are not investing in early stage businesses,” said Dupuy. “The Tennessee program addresses this gap, bringing new capital and more investment expertise to Tennessee. The National Coalition recognizes the need for innovative programs like this one.”

In addition to recognizing sponsors Overbey, and Rep. Charles Sargent (R-Franklin) and the entire General Assembly, the National Coalition for Capital applauds Governor Phil Bredesen, Director of Revenue Reagan Farr and Economic Development Director Matt  Kisber for their leadership role in creating a “best practices” legislative initiative.

About the National Coalition for Capital

The National Coalition for Capital (NCFC) is a non-profit, nationwide coalition of leaders supporting economic development and job creation through long-term access to capital for entrepreneurs and emerging companies. To learn more about NCFC, visit www.nationalcoalitionforcapital.org.

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