Thank You for Protecting Delaware’s Future

Thank you to our state legislators who worked to protect Delaware's future and economy by voting YES on SB21.  SB21 makes sensible reforms to Delaware's corporate law that continue to make our state the gold standard for doing business.  

“Delaware, for over a century, has been the place where leading corporations make their corporate home. We have been a stable, steady, incorruptible arbiter of corporate disputes. It’s really important to business that there’s a steady, stable bedrock of law, so when there is disagreement between shareholders and management, there’s clarity, consistency, predictability and fairness.”

- Delaware Gov. Matt Meyer

“The swiftness with which the state Senate introduced the bill is also laudable…We understand other companies are also considering whether to vote on the question at their upcoming annual meetings, with proxy season beginning next month for many public companies. The time to address concerns about Delaware’s continued value as a venue for incorporation is before play starts, not after the game has begun.”

- Former Chancellor William Chandler III and Widener Law Professor Lawrence Hamermesh

Fees on Corporations and Other Business Entities, Generate over $2 Billion in Direct State Revenue Annually, Fund our Schools, Public Safety and Other Critical Services in Delaware

“Lose those companies, and the burden hits us – small shops, entrepreneurs, families, workers already stretched thin. Towns quiet down. Schools lose funding. Roads rot. Texas builds glass towers while Vegas rolls out the red carpet for our runaways. They’re not taking a slice; they’re after the whole bakery.”

- Delaware Family Business Owner

What’s at Stake

Nearly 40% of Delaware’s revenue comes from franchise fees on corporations and other related sources. Passing Senate Bill 21 (SB21) makes needed reforms to Delaware’s corporate law that will continue to make the First State the best state in which to do business, while funding priorities for hardworking Delawareans.

  • All Other Sources
  • Fees on Corporations
  • All Other Sources
  • Fees on Corporations

SB21 Facts

  • The Governor, General Assembly and legal experts regularly work together to update Delaware’s corporate law to adapt to allow Delaware to maintain its position as the leading place to do business.

  • This year’s update, SB21, was crafted with input from Delaware legal experts, which included former members of Delaware’s judiciary who are experts in corporate law, to address urgent issues that jeopardize nearly 40% of Delaware’s funding for critical services like schools, healthcare and public safety.

  • SB21 restores the balance. It once again provides predictability and clarity for directors, officers and stockholders – the hallmarks of Delaware law. Excessive, frivolous litigation, on the whole, harms the interests of all investors.

“Delaware has always protected the rights of minority shareholders and will continue to do so, because doing so is good business.” Jonathan Macey, professor at Yale Law School

  • The underlying issues that the proposed legislation seeks to address were highlighted as early as 2022 in an article penned by two prominent former members of Delaware’s judiciary and one of the nation’s leading corporate law academics. Recent cases shined a spotlight on them and highlighted the urgency needed to implement the reform to optimize Delaware’s corporate law.

  • SB21 applies to all corporations, and according to leading experts, strikes the right balance between corporations, their boards of directors and investors. Stockholders, including hardworking Delawareans who are stockholders in Delaware corporations, continue to have the necessary protections consistent with Delaware law.

  • The Delaware Franchise is being attacked by other states, making the need for this bill urgent. If the General Assembly does not pass this bill now, Delaware risks losing the over $2 billion in annual revenue that helps fund our state programs.  (See: “Texas Lawmakers Aim to Supplant Delaware as Corporate HQ Hub With New Pro-Business Bill” - Texas Tribune)

How does passing SB21 help hardworking Delawareans?

Our Schools and Critical Services are Funded by Fees on Corporations

Nearly 60% funding for Delaware’s schools, public safety and critical services comes from the state. Fees on corporations and related revenue significantly supports the state budget, holding down property taxes and allowing Delaware to go without a sales tax.

Good Delaware Jobs Depend on Good Policy

Over two-thirds of Fortune 500 companies are incorporated in Delaware, supporting jobs and small businesses across the Delaware Economy.

“If a mass exodus of corporations were to occur, our members would lose thousands of customers and a perennial source of business. Such a significant loss of income could lead to staff cuts or even property closures, which would harm not only the hospitality industry but the entire Delaware economy.”

- Delaware Hotel and Lodging Association