Young Texans’ Crowdfunding Bill Becomes Law
July 1, 2015
Rep. Eric Johnson introduced H.R. 1629 to expand economic development opportunities for nonprofits in Texas.
Young Texans Legislative Caucus Chair, Rep. Eric Johnson, introduced HB 1629 to expand intrastate crowdfunding to nonprofits that are federally approved for lending. Upon receiving this bill that passed both chambers of the Texas legislature, Governor Greg Abbott neither vetoed or signed it, and therefore allowed it to become law.
“The current rule is that the organization participating in crowdfunding can’t have a financial interest. That leaves a lot of our loan programs out,” said Johnson. “Our bill would waive that provision so nonprofits can create a portal and post loans to that portal.”
Under HB 1629, small businesses can now receive capital from nonprofit community development financial institutions, or nonprofits with federal authority to distribute housing and community development block grants. This law amends recent legislation passed by the Texas State Securities Board by expanding the number of “authorized small business development entities” that can utilize crowdfunding portals to grow their ideas and create jobs.
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