Kennedy introduces SPAC Act to protect investors by increasing transparency surrounding blank-check firms
Jun 08 2023
WASHINGTON – Sen. John Kennedy (R-La.) today introduced the Sponsor Promote and Compensation (SPAC) Act, which would provide greater transparency for investors involved with Special Purpose Acquisition Companies (SPACs), also known as blank-check companies.
“Celebrities are often the public face of SPACs, helping the companies sell shares to hardworking Americans who may not understand the risks associated with SPACs. So, it’s right and fair that SPACs should disclose how theirs sponsors get paid and how that affects the value of the shares that main street investors are holding. My bill would require this kind of transparency,” said Kennedy.
SPACs raise investor funds through an initial public offering (IPO) with the goal of acquiring and merging with a private company within a two-year window. The SPAC formula is attractive because it permits companies to go public on a U.S. stock exchange without the delays and demands of a traditional IPO, allowing them to avoid liability and disclosure regulations.
Fifty percent of all IPOs in the U.S. in 2020 involved SPAC structures, and SPACs raised $82 billion in the same year. In the first three months of 2021, SPACs outpaced traditional IPOs, raising $95 billion in that time.
When a SPAC proposes a merger with a private company, current SPAC shareholders can choose to redeem their original SPAC shares for money plus interest rather than participate in the merger by acquiring new shares in the merged company. If a SPAC fails to complete a merger within two years of its creation, it liquidates and returns all funds to its shareholders, with interest.
Wall Street executives, celebrities and other public figures often serve as the founders and sponsors of SPACs. They act as the public face of the company, use their influence to fundraise through share offerings, promote the company and help identify a private company with which to merge.
Most SPAC sponsors award themselves “founder shares” that convert into public shares after the merger between the SPAC and a private company. The founder shares typically represent as much as 20 percent of the total share value of the company.
This type of compensation does not exist as part of traditional IPOs. When SPAC sponsors convert the shares that they receive in the merged company, the public’s shares of that company are diluted and lose value. The valuation of SPAC shares may fall even further if a SPAC sponsor chooses a weak company with which to merge.
Some market experts have called for SPACs to make their compensation structures more explicit in order to protect retail investors.
Within 120 days of its enactment, the SPAC Act would require the SEC to issue rules on enhanced disclosures for SPACs during the initial public offering stage and the pre-merger stage to make those disclosures more transparent to investors, especially main street investors. These measures would help investors make more informed decisions about a company’s shares.
Text of the SPAC Act is available here.
Kennedy announces $2 million in Hurricane Ida aid for the Leonard Chabert Medical Center
Jun 08 2023
WASHINGTON – Sen. John Kennedy (R-La.), a member of the Senate Appropriations Committee, today announced $2,006,964 in Federal Emergency Management Agency (FEMA) grants for Louisiana disaster aid.
“I’m grateful to see this $2 million being used to help the folks at Houma’s Leonard Chabert Medical Center repair their facility,” said Kennedy.
The FEMA aid will fund the following:
- $2,006,964 to the Ochsner Clinic Foundation at the Leonard Chabert Medical Center to repair damages as a result of Hurricane Ida.
WASHINGTON – Sen. John Kennedy (R-La.) has cosponsored the Resident Education Deferred Interest (REDI) Act. Sens. Jacky Rosen (D-Nev.) and John Boozman (R-Ark.) introduced the REDI Act to allow medical professionals serving in a medical or dental internship or residency program to defer their student loans without interest accruing while they complete those programs.
“Louisianians need more access to affordable doctors and dentists. By pausing interest accrual while health care providers finish their training, we can enable more qualified professionals to care for people who are most in need,” said Kennedy.
This bill does not erase debt or bail borrowers out. Rather, the legislation would simply defer the interest medical and dental students pay on their loans until after they have completed their residencies.
Medical residencies typically last three to 10 years. Doctors and dentists often earn modest salaries during residency, while their debt grows rapidly as interest accrues.
As a result of this debt burden, many residents pursue lucrative fields of practice over areas that are in higher demand, such as primary care.
Since this bill represents only a deferment, this bill would not add to the deficit.
The bill text is available here.
Kennedy leads bipartisan letter asking Afghanistan inspector general for insight on Ukraine aid
Jun 07 2023
WASHINGTON – Sen. John Kennedy (R-La.) has written to the Special Inspector General for Afghanistan Reconstruction, John F. Sopko, to request insight from Afghanistan reconstruction efforts that may be applicable to U.S. assistance efforts in Ukraine. Sens. Kyrsten Sinema (I-Ariz.), Kevin Cramer (R-N.D.) and Mike Braun (R-Ind.) joined the letter to the Office of the Special Inspector General for Afghanistan Reconstruction (SIGAR).
“In addition to its hundreds of audits and investigations, SIGAR has issued several informative lessons learned reports on topics such as security assistance, economic development, monitoring and evaluation of aid programs, and anti-corruption efforts, among many others,” began the senators.
“Accordingly, we desire to learn more about how those lessons from Afghanistan could be applicable to the current situation in Ukraine, as the U.S. Congress has already appropriated more than $113 billion for Ukraine assistance since last March,” they explained.
“It is our firm belief that robust oversight of current and future U.S. assistance efforts in Ukraine is imperative for their success. A critical part of that oversight is ensuring the U.S. acts on key lessons from previous conflicts, including Afghanistan. Doing so will help us avoid repeating costly mistakes and protect the massive investment in Ukraine by American taxpayers from waste, fraud, abuse, and failure,” concluded the lawmakers.
Kennedy and Sinema have introduced the Independent and Objective Oversight of Ukrainian Assistance Act to establish a Special Inspector General (IG) for Ukraine. The Special IG would oversee the humanitarian, economic and security assistance funding that the U.S. Congress has provided to the country and make sure that the funds are appropriately spent.
Their op-ed on this effort appeared in USA Today this week.
The senators’ letter to SIGAR is available here.
Kennedy on China: “In refusing to talk, the Chinese Communist Party and its insecurities are loud”
Jun 07 2023
Watch Kennedy’s full speech here.
WASHINGTON – Sen. John Kennedy (R-La.) today spoke on the Senate floor to condemn the Chinese Communist Party’s recent aggression toward the United States and our allies. He warned China that it would be a mistake to close lines of communication with the United States and called on Chinese leaders to start acting like responsible members of the global community.
Key excerpts of Kennedy’s speech are below:
“The United States and China should talk. The United States wants to, but the leadership of the Chinese Communist Party—the CCP—does not.”
. . .
“Talking does not show weakness. It shows strength. It shows confidence. America is confident. In refusing to talk, the Chinese Communist Party and its insecurities are loud.”
. . .
“All we want and all the world wants is for China to stop poisoning our children with fentanyl. Stop it.
“All we want and all the world wants is for China to end its debt-trap diplomacy through its Belt and Road Initiative and other loan schemes.
“All we want and all the world wants is for China to cease using its economic power to bully other sovereign countries—like Australia, like Lithuania—when those countries offer an opinion the Communist Party of China doesn't like.
“All we want and all the world wants, Madam President, is for China to tell us the truth—the truth about how the COVID virus started—or at least work with us and other countries so we can find out.”
. . .
“The advantages are and ought to be obvious. Why should we talk? To avoid military conflict? It's a pretty good start. To avoid miscalculation: The more silencer is between us, the more Beijing underestimates American strength.
“Why should we talk? To limit the risk of accidental confrontation. To pursue bilateral détente. Because our economies are interwoven. Because our economies are stronger together if everyone plays by the rules.”
. . .
“If China cares about the world and if the people of China care about how the world sees China—and both do—China will reengage with the world, including the United States of America, not shirk from it.”
. . .
“Frankly, Madam President, China has the most to gain given the deterioration of its reputation, but it's entirely up to China.
“America, we've done our part, Madam President. And the United States will continue to do its part. We want to talk. We are confident. But lately, China's insecurities are loud.”
Kennedy’s full speech is available here.
WASHINGTON – Sen. John Kennedy (R-La.), a member of the Senate Appropriations Committee, today announced $1,345,787 in Federal Emergency Management Agency (FEMA) grants for Louisiana disaster aid.
“Louisianians are still dealing with the devastating effects of Hurricane Laura. I’m grateful to see that this $1.3 million will go toward repairs for McNeese University,” said Kennedy.
The FEMA aid will fund the following:
- $1,345,787 to the Office of Risk Management to repair damages to the McNeese University football facility as a result of Hurricane Laura.
Kennedy, Cortez Masto introduce bipartisan bill to help Louisianians recover from natural disasters
Jun 06 2023
WASHINGTON – Sens. John Kennedy (R-La.) and Catherine Cortez Masto (D-Nev.) today introduced the Filing Relief for Natural Disasters Act to provide relief for taxpayers in states that have issued state-level disaster declarations. Currently, the Internal Revenue Service (IRS) has the authority to postpone tax filing deadlines following a presidentially-declared federal disaster, but not following the declaration of a state-level emergency.
“Louisianians have been hit with all the storms nature has to offer. While our people do the hard work of rebuilding, even a little commonsense help can go a long way, including extensions for filing taxes. This bill would make sure that Louisiana has the freedom to provide disaster victims with the federal tax extensions they need to recover. I’m thankful to partner with Sen. Cortez Masto on this effort,” said Kennedy.
“While I’m glad the administration heeded my call and issued a federal disaster declaration for Nevada counties impacted by severe flooding, too many communities harmed by natural disasters each year miss out on the critical tax relief that comes with federal recognition. My bipartisan bill will fix this problem and support more Nevada taxpayers experiencing extreme weather and wildfires,” said Cortez Masto.
Sens. Marsha Blackburn (R-Tenn.) and Chris Van Hollen (D-Md.) also cosponsored the legislation.
The Filing Relief for Natural Disasters Act would allow the governor of a state or territory to extend a federal tax filing deadline following a state-declared emergency or disaster instead of waiting for a federally-declared disaster. This means that states would have the ability to provide tax relief independent of the federal government’s involvement in an emergency or natural disaster.
The Filing Relief for Natural Disasters Act would also expand the mandatory federal filing extension from 60 days to 120 days.
Full text of the Filing Relief for Natural Disasters Act is available here.
Kennedy announces $25.1 million in disaster aid for Calcasieu, St. Tammany, Tangipahoa Parishes, New Orleans
Jun 05 2023
MADISONVILLE, La. – Sen. John Kennedy (R-La.), a member of the Senate Appropriations Committee, today announced $25,119,195 in Federal Emergency Management Agency (FEMA) grants for Louisiana disaster aid.
“I am grateful to see Calcasieu, St. Tammany and Tangipahoa Parishes, along with the city of New Orleans and other parts of our state, receive this $25.1 million for flood protection and Hurricane Laura recovery,” said Kennedy.
The FEMA aid will fund the following:
- $11,690,079 to the Office of Risk Management to repair damages to 42 water control structures as a result of Hurricane Laura.
- $7,355,145 for the elevation of 30 properties in St. Tammany Parish to mitigate flood risk.
- $2,455,921 for the elevation of 10 structures in the city of New Orleans to mitigate flood risk.
- $2,390,687 for the elevation of 13 properties in Tangipahoa Parish to mitigate flood risk.
- $1,227,363 to the Calcasieu Parish School Board to repair damages to Dolby Elementary School as a result of Hurricane Laura.
Kennedy votes against Biden’s debt deal
Jun 02 2023
WASHINGTON – Sen. John Kennedy (R-La.) released the following statement upon voting against continuing Washington’s pattern of extreme spending and debt accumulation:
“Speaker McCarthy and House Republicans did an extraordinary job of getting President Biden to the table, and I thank them for their hard work. However, I voted against this bill because it would normalize and institutionalize the emergency spending that Congress had to provide during the pandemic.
“Before the pandemic, the federal government was spending $4.3 trillion per year. In 2023, it will spend $6.3 trillion—that’s a 45 percent increase since the pandemic. This bill also allows debt to rise by $4 trillion over the next two years alone.
“Our economy can’t afford to make that the standard going forward. America has to move forward, not sink deeper into debt and grow more addicted to reckless spending sprees.”
WASHINGTON – Sens. John Kennedy (R-La.) and Kyrsten Sinema (I-Ariz.) penned this op-ed in USA Today advocating for the installation of a Special Inspector General to help ensure Ukraine uses America’s aid efficiently and effectively.
Sen. Kennedy introduced the Independent and Objective Oversight of Ukrainian Assistance Act earlier this year, a bill that would establish a Special Inspector General in Ukraine to help advise Congress on future aid packages and confirm that Ukraine spends each taxpayer dollar as Congress intended. Sen. Sinema is a cosponsor of the legislation.
Key excerpts of the op-ed are below:
“Our aid to Ukraine isn’t charity. It’s in our national security interest.
“As we determine how to best support Ukrainian sovereignty against Russia’s unprovoked and illegal war, it is important that Americans can understand and track how the resources are used.
“Taxpayers in Arizona and Louisiana help fund this investment. And our constituents deserve to know that each dollar sent to Ukraine is spent with the singular aim of deterring Russian President Vladimir Putin and maintaining peace for the United States and our allies.”
. . .
“Today, we have a patchwork of watchdogs each following a different trail of money and no one entity to keep an eye on the whole picture. If the American people want to keep track of all the different streams of military, financial and humanitarian aid flowing into Ukraine, we need a dedicated team of regional experts following every penny.
“It is just common sense, and it is what our bill, the Independent and Objective Oversight of Ukrainian Assistance Act, will do.”
. . .
“Polling shows that Americans are split on whether we should continue to directly fund Ukraine. These good-faith debates are important to our democracy—something Putin wouldn’t understand but does fear.
“But today, it is difficult to engage in a meaningful debate over the effect of our aid when Congress doesn’t have a complete picture of how the money is spent. A Special Inspector General in Ukraine will help us make better investments to deter Putin and protect America’s national security interests.”
Read the full op-ed here.
