NORMAN OK (May 20, 2010) - Manager of state tax credit program got 99% of tax credits going to fund he provides oversight!


Nick Baker

Internal OTC emails reveal, Robert G. Heard received 99% of the "Venture Capital" tax credits going to Cimarron Business Capital Company. Under an outsourcing contract, Robert G. Heard provides oversight of the "Venture Capital" tax credits he is personally benefitting. The program has no other tracking or accountability, and OTC refuses to release information.

What happened?

Oklahoma Capital Investment Board (OCIB) a public trust was originally setup to provide oversight of the state's "Venture Capital" tax credit program. Later OCIB management and oversight was outsourced to Institutional Equity Associates (IEA or Edge) under Robert G. Heard's management. View outsource contract.

Robert G. Heard also manages, Cimarron Business Capital Company, one of two funds allowed to participate. The funds receives tax credits amounting to 20% of the funds they invest, to reward their investors. The tax credits, which can be sold for cash, go back to the investors.

Robert G. Heard invested of 99% of the money Cimarron Business Capital Company had to invest. 99% of the tax credits went back to Heard.

The other fund allowed to participate is Cottonwood Valley Ventures a BOK subsidiary, which receives 100% of its funds from another BOK subsidiary, CVV Partnership.

The chart below lists "Venture Capital" tax credit program investments and tax credits for 2006, 2007 and 2008; the only years information is available for Cimarron, and 2009 for Cottonwood1.

Investor   Invested   Fund   Fund invested> in businesses   Tax credits   Received>tax credits
Origen, Inc   $152,436   Cimarron Business   $152,436   $30,487   Origen, Inc
Robert G. Heard   $16,922,097   Cimarron Business   $10,073,3431   $3,384,4191   Robert G. Heard
CVV Partnership   $1,090,000,000   Cottonwood Valley   $455,509,850   $91,101,970   CVV Partnership

(1) As was previously reported here, this program was supposed to end December 31 2010. However, Cottonwood Valley Ventures, filed a 2009 claim, claiming the program is still open, for getting tax credits for investing. The claim was challenged by an OTC auditor, which OTC tax credit mangers neglected. It was in this challenge where the only reports available were found.

This is where CVV shifted its interpretation of the law and started taking tax credits based the year money was invested, according to the law. Before the program closed in 2008 CVV disregarded the law and claimed tax credits the year CVV Partnership invested the money. CVV was doing it one way before to serve its own agenda. Then switched in an effort to justify claiming it had omitted an $800 investment. Then saying we can keep going.

"Venture Capital" tax credit program was supposedly terminated December 31, 2008. An alert OTC auditor questioned Cottonwood Valley Ventures' recent January 2010, tax claim amendment it had omitted reporting receiving $800 million of the $840 million investments it received in 2008.

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