ND Corporate Law May Bring New Revenue To State

American Railcar, which has 50 million authorized shares of stock, will owe the $80,000 fee maximum over the entire year. If the cap were not in place, the company would pay an annual fee of $300,000. Delaware's annual franchise fee cap is $165,000.

"Now that this first one has hit, I think (the North Dakota corporate law) will be noticed more out in the corporate world," Jaeger said. "It will draw some attention to North Dakota."

Ten percent of a corporation's franchise fee under the new law is earmarked for the secretary of state's operating fund, with the remainder going into the general state government treasury. For the 2009-2011 budget period, the secretary of state's entire two-year budget is $18.4 million.

"I think when we got into this, I didn't believe we would be getting hundreds (of new company incorporations) or anything like that," Jaeger said. "But if you have 10 or 15 of them register, that certainly would be something we would find to be beneficial."

Shareholder-rights activists have asked stockholders in at least 18 companies to approve reincorporating in North Dakota. Fifteen have rejected the idea; two other companies, insurer American International Group Inc. and Pep Boys, an auto parts and repair company, will decide the question later this month.