OFFICE OF FISCAL ANALYSIS

Legislative Office Building, Room 5200

Hartford, CT 06106 (860) 240-0200

http://www.cga.ct.gov/ofa

SB-23

AN ACT CONCERNING BENEFIT CORPORATIONS AND ENCOURAGING SOCIAL ENTERPRISE.

AMENDMENT

LCO No.: 4741

File Copy No.: 603

Senate Calendar No.: 397


OFA Fiscal Note

State Impact:

Agency Affected

Fund-Effect

FY 15 $

FY 16 $

Secretary of the State

GF - Potential Revenue Loss

More than 400,000

More than 400,000

Secretary of the State

GF - Potential Cost

Minimal

Minimal

Secretary of the State

GF - Savings

Minimal

Minimal

Municipal Impact: None

Explanation

The amendment eliminates fees associated with the termination or dissolution of certain business entities and allows the Secretary of the State (SOTS) to administratively dissolve certain business entities that fail to file an annual report.

Fees for terminations, dissolutions, and withdrawals range from $20 to $120 with an average of $73. During calendar years 2011 and 2012 the Secretary of the State processed approximately 10,000 transactions per year that would be impacted by the bill. Though the revenue loss to the SOTS is dependent upon both the number and type of affected transactions, it is anticipated to be greater than $400,000 in both FY 15 and FY 16.

The provisions in the amendment that allow SOTS to administratively dissolve certain business entities that fail to file an annual report are anticipated to result in potential minimal costs for SOTS.

In addition, the SOTS is anticipated to realize minimal savings associated with a reduction in check processing arising from the elimination of certain fees for dissolution of business entities. The SOTS may also realize minimal savings through a reduction of notices sent to delinquent businesses if granted the authority to administratively dissolve certain business entities.