Delaware
Will plan to revamp incorporation law protect or damage Delaware’s $2B kingdom?
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In the parlance of Delaware political and legal insiders, “the franchise” is king.
Without the franchise, the state couldn’t pay for public schools, police, prisons, social and health programs, beach replenishment, farm preservation or so much more.
Without the franchise, taxes would be significantly higher, or the state would need to slash services.
The franchise is Delaware’s system, which currently has 2.2 million businesses — and two-thirds of the Fortune 500 — incorporated in the nation’s second-smallest state. Amazon, JPMorgan Chase, Nvidia and the corporate parents of Google and Facebook and Instagram are among about 1,350 Large Corporate Filers who fork over $250,000 apiece in franchise taxes.
All told, those “incorporation revenues” are projected to directly generate $2 billion for the state treasury this year. That accounts for 29% of the state’s general fund revenue.
But today, fear is rampant in Delaware that the business-friendly franchise that some also call the “golden goose” is in serious danger of being cooked — that a mass corporate exodus or “DExit” is imminent.
Trepidation has grown over the last year since Elon Musk pulled Tesla and SpaceX out of Delaware and castigated the Delaware Chancery Court, which has long been considered the franchise’s crown jewel for its deft and reliable resolution of complicated business disputes.
“Absolute corruption,” Musk tweeted in December after the court’s chief judge rejected his $56 billion pay package from Tesla for the second time. The file-sharing platform Dropbox has announced it’s divorcing from Delaware, and other major companies such as Meta Platforms, the parent of social media giants Facebook and Instagram, say they might do the same.
So this month, new Gov. Matt Meyer, legislative leaders and a cadre of legal luminaries decided to neutralize the perceived threat before it gains ground.
Together, they crafted a complex proposal to revamp Delaware corporate law by essentially making it tougher for shareholders to sue founders and top executives for perceived conflicts.
They did so, Meyer and others involved in the process say, to alleviate concerns they are hearing from the nation’s corporate community that Chancery Court has grown increasingly unfriendly to top execs like Musk in mega-dollar cases.
Meyer, a Democrat and lawyer who took office Jan. 21, echoed other supporters when the bill was introduced Feb. 17. “We will protect our reputation and continue Delaware’s tradition of a balanced and measured approach, and we will do so relentlessly,” Meyer said.
Meyer’s concern is magnified by the impact a DExit would have on balancing the $6.8 billion state budget and maintaining public services during his four-year term, especially at a time when President Donald Trump is trying to cut critical federal funding to states.
Delaware needs and wants those $2 billion in incorporation revenues every year, plus a related $420 million the state gets from abandoned financial accounts at banks and other companies registered in the state, Meyer said.
“When one-third of your state’s budget is on the line and you’re eyeing down untold federal budget cuts, you have to make a choice: protect your residents or not. And I choose Delawareans every day,” Meyer said in an interview last week. “Any bill that helps improve our financial stability needs to be considered fully.”
Lawrence Hamermesh, professor emeritus at Widener University’s Delaware Law School and one of the bill’s drafters, said it will restore eroding confidence in corporate circles and prevent “catastrophic” cuts to the state budget.
“Unlike as long as I’ve been practicing and teaching corporate law, there is no longer the inclination to tell clients and to conclude that Delaware is the place to set up your corporation,” Hamermesh said. “That is potentially the source of a tipping point that would be devastating for the state and its taxpayers and workers and everybody here.”
The bill, which has bipartisan support that includes the Senate and House leadership, could become law within a month, said Delaware Senate Majority Leader Bryan Townsend, the chief sponsor.
While the bill currently has no effective date — spurring speculation that it could be retroactive and change the result of cases involving Musk and other executives — state Sen. Townsend said it’s being modified so the effective date would be after it’s signed into law.
Pennrose and JPMorganChase help neighborhoods – and residents – thrive.
Finding an affordable place to live continues to be a challenge for many as widespread housing shortages persist across the U.S. Rising home prices and high interest rates have made homeownership inaccessible for a large portion of the population. Meanwhile, as rental demand increases, the number of renters facing affordability challenges is also on the rise.
The State of the Nation’s Housing 2025 by Harvard University’s Joint Center for Housing Studies reveals that cost burdens for renters reached another record high in 2023. Similarly, the JPMorganChase Institute reports that renter affordability is declining and forcing people to devote more of their take-home pay to housing costs. There is a growing need for affordable housing across the U.S., and that rings true here in Wilmington.
To close that gap, it’s essential that all Wilmington residents share in its growth with housing options that accommodate a range of needs and budgets. For the Pennrose real estate firm, this meant delivering a concrete solution to the local community, resulting in housing for individuals and families who otherwise might not have been able to live in the area.
Reinvesting in Wilmington’s Riverside
In Wilmington, the Riverside redevelopment initiative is focused on neighborhood stability at a scale that can be felt across generations – bringing housing, education and community resources together so families can remain rooted and move forward. Imani Village, developed by Pennrose in partnership with the Wilmington Housing Authority and nonprofit community organization REACH Riverside and constructed with support from JPMorganChase, is part of this broader effort, which is expected to create more than 600 high-quality, mixed-income homes while also enhancing and expanding EastSide Charter School and Kingswood Community Center to help establish a “cradle to college/career readiness education pipeline.”
By tying new housing to strengthened local institutions, the redevelopment aims to reduce the pressure that forces families to relocate and instead keep children closer to school, neighbors closer to one another and residents connected to the services that help them thrive. In practical terms, Imani Village represents not just additional homes, but a commitment to building a neighborhood where opportunity is easier to access and easier to keep.
“We’re proud of the far-reaching impact this project will have. It reflects Pennrose’s mission to uplift our communities and expand the supply of high-quality, affordable homes,” said Brett Macleod, Community Development Banking, J.P. Morgan. “Every additional housing unit matters – and increasing the number that are affordable is critical.”
A broader commitment to Wilmington’s future
While Imani Village is foundational, the vibrancy of a community depends on much more. In Delaware, the firm provides banking services to 215,000 customers and works across sectors to expand economic opportunity. Over the last five years, JPMorganChase has invested more than $25 million in local nonprofit organizations, supported 25,000 small business clients and delivered financial health education to thousands of residents to broaden access to banking, financial health resources, homeownership and other wealth-building tools.
“As we work with local stakeholders to expand housing options, JPMorganChase’s goal is to create inclusive economic opportunity for all,” said Don Mell, Location Management, Americas East Region Lead and member of the Delaware & Philadelphia Market Leadership Team at JPMorganChase. “When our communities thrive, we all thrive.”
Learn more about affordable housing and community development at jpmorgan.com/commercial-real-estate.
Read more from Spotlight Delaware
DNREC opened the new Delaware Environmental Laboratory near Smyrna today with a ceremonial ribbon cutting for a state-of-the-art facility that features scientific analysis of emerging contaminants such as PFAS, water quality testing and early detection in Delaware of human and animal diseases. DNREC Secretary Greg Patterson led the cutting. Celebrants, left to right, were: DNREC Deputy Secretary Dayna Cobb, former DNREC Secretary Shawn Garvin, Sec. Patterson, Delaware Environmental Lab Director Ashley Kunder, former DNREC Secretary Christophe Tulou, former DNREC Secretary David Small, State Senator Stephanie Hansen, US EPA Region 3 Deputy Administrator Catherine Libertz, State Sen. Kyra Hoffner, Kate Rohrer representing US Senator Chris Coons, and John Gentile, representing Senator Lisa Blunt Rochester. /Delaware DNREC photo
The Department of Natural Resources and Environmental Control’s Delaware Environmental Laboratory has opened near Smyrna, providing a state-of-the-art facility to test water quality, chemical contaminants including per- and poly fluoroalkyl substances (PFAS) and conduct molecular and microbiology. DNREC Secretary Greg Patterson was joined today for a ceremonial ribbon cutting by representatives of the state’s congressional delegation, state legislators, former DNREC cabinet secretaries and organizations that depend on the environmental lab for scientific analysis.
The new lab replaces a facility that has operated since 1983 in a converted 19th-century cannery that serves as DNREC’s headquarters building in Dover. The spacious new lab building will house up to 24 scientific, technical and support staff. With its strategic location adjacent the state Department of Health and Social Services Public Health lab, the Delaware Environmental Laboratory will perform testing in support of environmental and public health programs focused on detection of human and animal diseases, as well as environmental emergency response, education and training. The new facility is the third environmental lab in the state’s history.
Construction of the Delaware Environmental Laboratory was supported by a combined $29.7 million from the American Rescue Plan Act – funded by President Joe Biden and Congress – and state funds.
“DNREC’s lab has done amazing work in the last 40 years but did so in spaces that looked like a middle school science classroom, so it definitely needed an upgrade,” DNREC Secretary Patterson said. “The new modern, environmental lab will provide optimum conditions for the skilled and dedicated staff DNREC depends on to help protect the health and safety of Delawareans and our environment, with greater capabilities for addressing environmental and public health challenges of today and into the future.”
Beyond the lab’s expanded capabilities for analytical testing and applying scientific expertise, the proximity between the new DNREC laboratory and the Division of Public Health lab will enable the state to benefit from support between technical experts, materials and supplies when critical situations arise, such as preventing disease outbreaks on coastal beaches or helping mitigate accidental industrial releases of toxic substances or the impacts of pollutants – with both labs focused on underserved or at-risk communities throughout the state.
DNREC expects the new facility to encourage continuing innovation from the various specialized sections of the lab in meeting global environmental and public health challenges of the times, with PFAS and other contaminants of emerging concern among the priorities. The new Delaware Environmental Laboratory continues to increase DNREC’s analytical testing capability. The lab has established new testing capabilities for PFAS, emerging contaminants and other specialized testing, such as environmental DNA. Beyond meeting DNREC’s analysis needs, the Delaware Environmental Lab also serves organizations such as the Center for the Inland Bays, the Delaware River Basin Commission, the U.S. Geological Survey, Delaware Geological Survey and the University of Delaware.
“The opening of our new environmental laboratory represents a significant investment by the state,” said Delaware Environmental Laboratory Director Ashley Kunder. “This strengthens our ability to provide high-quality scientific data that state agencies and policymakers rely upon to make informed decisions and protect our natural resources. Most importantly, this laboratory reflects our commitment to the citizens of Delaware. This new facility supports our talented group of scientists and technical professionals, thus strengthens our ability to deliver timely, accurate, and defensible data. We are excited to begin this new chapter and look forward to meeting our mission of protecting public health and the environment.”
About DNREC
The Delaware Department of Natural Resources and Environmental Control protects and manages the state’s natural resources, protects public health, provides outdoor recreational opportunities and educates Delawareans about the environment. The DNREC Division of Water manages and protects Delaware’s water resources. For more information, visit the website and connect with @DelawareDNREC on YouTube, Facebook, Instagram, X or LinkedIn.
Media Contact: Nikki Lavoie, nikki.lavoie@delaware.gov; Michael Globetti, michael.globetti@delaware.gov
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