Saturday, August 2, 2014

NC JOBS Act Crowdfunding Update - House Rejects Senate Substitute Bill, Senate should vote on H680 on its own merits

Yesterday the NC House rejected the NC Senate's substitute consolidated bill H1224 which merged 5 separate and unrelated economic development bills into one. Part V of the bill is the original H680 NC JOBS Act crowdfunding bill which passed the NC House on its own by 103 to 1 last year. House members objected to provisions of several of the other bills that were included in H1224, but no objections were raised concerning Part V, the NC JOBS Act section. The NC Senate leadership has failed to bring the original H680 to a vote on its own merits, and instead has pursued a strategy of bundling the popular and innovative intrastate investment crowdfunding bill with other lesser known and more controversial bills in three different attempts to push them through the legislature. This strategy has failed. It is time for the Senate leadership to do the right thing and bring the original H680 up for a vote, and pass it before this session ends.

The Legislature has not yet formally adjourned, and the potential of reconvening again this session is still possible, so the future is uncertain. We call on the NC Senate to bring the original H680 NC JOBS Act bill up for a vote on its own. The North Carolina economy and job creation in our state will suffer if we fail to enable this new way of financing small businesses and startups across the state.

As of today, 12 states have already enabled intrastate investment crowdfunding, and 11 more states have started the process. Most have followed the lead of H680, which was the first intrastate crowdfunding legislation to be proposed and passed by any state house last year. This is now a nationwide trend, and North Carolina is in danger of missing the boat on this great opportunity.

Intrastate Crowdfunding Exemptions Enabled as of July 2014:

Intrastate Crowdfunding Exemptions in Process as of July 2014:
◦ Missouri
◦North Carolina
◦New Jersey
◦South Carolina

As we have emphasized from the beginning, the NC JOBS Act does not cost taxpayers a single dime. It is simply an exemption in our state securities law that enables a new way for small businesses and startups in our state to raise money with debt or equity, and allows any North Carolina citizen to invest in those opportunities provided the registration, reporting, limits, and disclosure rules in the bill are followed. Please see the FAQs for more details on the bill.

The fate of this bill is in the hands of the NC Senate leadership. This legislation enables a new type of financing known as intrastate investment crowdfunding. It has been endorsed by many of the top startup and business leaders in the Triangle community. The list includes endorsements from CEOs, founders, managing directors, partners, and investors at our leading startup accelerators, our leading venture capital funds, individual angel investors and angel funds, a leading CPA firm, the North Carolina Technology Association, the North Carolina Biotechnology Center, SAS Institute, UNC Chapel Hill Technology Development Center, Triangle area business attorneys, and many of our local technology startup CEOs. This is a strong showing of support that we received in a 72 hour period recently. These startup community leaders are representative of the over 14,000 startup and small business community members and everyday investors across our state that have visited our NC JOBS Act blog to learn more, and are excited about the possibilities to start and grow a new business, or expand an existing business, or invest in a favorite local business opportunity, and create more jobs.

We urge the Senate leadership to do the right thing, bring the original bill up for a vote, and pass H680.

Please call and email your expressions of support for H680 to the Senate Leadership. Senator Berger is Senate President Pro Tem, Senators Gunn and Meredith are the co-chairs of the Senate Commerce committee, and Senators Rucho and Rabon are the co-chairs of the Finance committee. Senator Apodaka is Chairman of the Rules Committee. Please ask them to move the original H680  bill as passed by the NC House forward. Representative Tom Murry is Chairman of the House Commerce Committee and the Chief Sponsor and creator of H680. The original bill needs quick action by the Senate before the end of the current session. Since H680 has already passed the Senate without changes or opposition as part of H1224, it will be very easy and quick to move it through the Senate and get this bill to the Governor's desk. We urge the Senate to get this done now!

Thank you for your support.

Best regards,
The NC JOBS Act Team

Contact information for NC Legislators:

Representative Murry
 Office: 919-733-5602

Senator Berger
 Office: 919-733-5708

Senator Gunn
 Office: 919-301-1446

Senator Meredith
 Office : 919-733-5776

Senator Rucho
 Office: 919-733-5655

Senator Rabon
 Office: 919-733-5963

Senator Apodaca
 Office: 919-733-5745

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