Like the 1,000s of other pages of evidence uncovered and descriptions of crimes on this site, this web page is only one part of a massive multi-state entanglement of government corruption and cover-up. See size

What Other States CAPCO Studies Revealed
StateCost states in millionsActual investmentNew Jobs
New York$28088
Wisconsin$50 157
Florida$150 150
Louisiana$600 $180
Colorado$100 $44
Ref. CAPCO: A Bad Investment for Georgia View
       Bad investments View

The following from CAPCO: A Bad Investment for Georgia

What is CAPCO?

"CAPCO" (short for "Certified Capital Companies") is a complicated program that several states have adopted at various times to address a perceived shortage of venture Capital. While there are many ways states can respond to this problem, CAPCO refers to a specific piece of industry-driven "model legislation" created in the early 1980s that a small cadre of large firms have shopped from state to state since the late 1990s.16 Started in Louisiana in 1983, CAPCO programs currently exist in nine states, while at least 12 others have rejected the concept outright.17 Several additional states have tried the program and either repealed or chosen not to extend it later on, including Wisconsin, where legislators turned back a renewed version of the proposal in 2011.18 Many of the model's toughest critics are from states that have experimented with it.

How Does CAPCO Work?19

Typically marketed as a "jobs bill," CAPCO creates a highly-complex financing process that converts the value of future tax credits into funds that can be invested in small business today. A basic overview is that the state creates deferred tax credits in the state insurance premium tax View, which insurance companies can gain access to by providing loans to "certified Capital companies," or CAPCOs, that have been certified by the state. The companies then "invest" those funds in in-state businesses, supposedly increasing economic activity and job creation.

A detailed description of CAPCO's complicated mechanics can be found in Appendix A; however, a brief primer on the process is as follows:

  • There are three parties to a CAPCO program's complex process: state government, insurance companies and the CAPCOs;
  • CAPCO legislation creates deferred credits in the insurance premium tax that incentivizes insurance View

CAPCO's History & Status in Georgia

On the last day of session in 2011 the Georgia House substituted language into Senate Bill 203 creating a $125 million "CAPCO" program. The revised bill had to return to the Senate for final passage, but it stalled before becoming law. However a version of the proposal, sometimes referred to as the "Georgia Small Business Investment Company Act," is likely to return in the 2012 session.

The proposal currently on the table is actually Georgia's second bout with the CAPCO model. In 2002 a $75 million version was passed with a start date of 2005, but it was repealed before going into effect by legislation in 2004.

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