Illinois Creates $60 Million Tech VC Fund

The Illinois General Assembly has passed legislation to encourage venture capital investment in technology businesses across the state. HB3212 creates the Technology Development Fund, which permits the State Treasurer to use up to 1 percent of the state's total investment portfolio for equity investments through Illinois venture capital firms.

The Chicago Tribune reported last Friday that the total amount of state funds available for venture capital investment will be as much as $60 million.

Eligible Illinois venture capital funds to receive monies from the new Technology Development Fund must use the state funds to place investments in technology businesses seeking to locate, expand, or remain in Illinois.

Also, state investments in any Illinois venture capital fund are limited to 10 percent of the total investments in the fund. The legislation states no more than one-third of the Technology Development Fund's balance may be invested in any given year.

HB3212 will take effect immediately after Governor George Ryan signs the act. The Governor's signature is expected as he first proposed two years ago that the state inject $800 million as tech-based VC over five years. Proponents for the fund, according to the Tribune, say the recession and declining state revenues forced the size of the effort to be scaled back.

HB3212 is available at: http://www.legis.state.il.us/legisnet/legisnet92/hbgroups/hb/920HB3212LV.html