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First step gets a little easier

01:00 AM EDT on Monday, September 10, 2007

By Timothy C. Barmann

Journal Staff Writer

The Web site for the secretary of state’s office takes entrepreneurs through the process of incorporating online.

The Providence Journal / Bill Murphy

The Rhode Island secretary of state’s office has made it easier to file the papers necessary to start certain types of businesses.

The office now allows entrepreneurs to fill out articles of incorporation over the Internet, through its Business Services Web page ( www.sec.state.ri.us/corps).

Visitors can register new for-profit corporations, limited partnerships and limited-liability partnerships. Those types of businesses represented 39 percent of all the 7,827 new businesses registered last year, according to the secretary of state’s office.

Those who want to register nonprofit corporations or limited liability companies (LLCs) still have to do so in person at the secretary of state’s office in Providence. The office said it planned to add online registration for those types of business entities next year.

“We are attempting to allow business to interact with our office 24/7, and for our office and government to be more accessible,” Secretary of State A. Ralph Mollis said by phone.

He said the improvements to the Web site were put into motion by his predecessor, Matthew Brown, who served as secretary of state through January.

The first phase of the improvements went online last month, when the office introduced a new search engine that it said was easier to use. The new system allows anyone to view and print annual reports and information on corporate officers for any of the 35,000 businesses registered in the state.

The new registration features were added last week and in the first day, 17 businesses used the site to form new companies. On the second day, 19 registered online. To put that in context, the office averaged about 30 registrations per day last year, all made in person.

“To have more than half our customers embrace electronic filing on Day One shows they were geared up for the upgrades and found the new system easy to use,” said Chris Barnett, a spokesman for the secretary of state’s office.

The reason that LLCs and nonprofit companies cannot be registered online has to do with an outdated state law, according to Mollis. He said he was advised by a staff attorney that there was some language in the law that prohibited the registering of these entities online. He said his office would seek a change in the statute, and he expected the General Assembly to take up that issue early next year.

Mollis said the online registration feature was made possible by software that his office purchased from the Massachusetts secretary of state’s office. The cost was $200,000 for a package that included more features yet to be implemented. On top of that, the office paid $275,075 to customize the software for Rhode Island businesses.

Barnett said that the cost to build just one part of the system from scratch would have been at least $1.2 million — the amount of the lowest bid.

Using the same software as Massachusetts will make it easier for companies who must register to do business in both Rhode Island and Massachusetts because the business owners will be familiar with the process, Barnett said.

Asked whether the new system might save money, Mollis said that it might, in the future. “There is the potential for that,” he said. “At this point, no. That was not one of the objectives.”

“In the long run, it could save us money. We would have to weigh how many people are visiting, is there less work to be done in this office?” he said.

Besides online business registrations, the site now allows the filing of Uniform Commercial Code liens, Mollis said. These forms are frequently filed by creditors as a public notice of their interest in commercial property.

In the next phase of improvements, Mollis said the site would include a database for trademark registrations.

tbarmann@projo.com

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