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Legislative Wrap-Up: Lawmakers Dedicate Funds for TBED in CO, CT, VA

June 20, 2012

Unlike last year when a wave of new governors pushed sweeping proposals to re-organize economic development activities and grow the economy, the 2012 legislative sessions brought mostly modest changes for tech-based initiatives. While many programs were level funded or received smaller increases than in previous years, a handful of states increased funds or introduced new initiatives to support economic development efforts. Colorado lawmakers provided additional funds to attract new companies, Connecticut lawmakers expanded programs from last year's Jobs Bill, and in Virginia lawmakers accepted the governor's amendments to add funds for research and commercialization initiatives.

Colorado
After several weeks of negotiations, lawmakers ultimately approved a $4 million funding boost for economic development incentives requested by Gov. John Hickenlooper last year to help the state attract high-wage jobs. The governor asked for $6 million for the Colorado Office of Economic Development and International Trade (OEDIT), which is typically funded at $1 million per year (see the Nov. 16, 2011 issue of the Digest). The budget signed by the governor included a total $5 million for OEIDT in FY13. However, of that amount $4 million was contingent upon revenues in excess of the amount projected for this fiscal year. On Wednesday, the Governor's Office of State Planning and Budgeting announced the general fund revenue is projected to be $239.5 million higher in the current fiscal year than was forecast in March, securing the $4 million increase for OEDIT's strategic fund.

Connecticut
A special one-day session in Connecticut ended last week with the approval of a long-awaited merger of two quasi-government state agencies focused on creating more startup companies and the passage of several measures to expand on last year's Jobs Bill (see the Nov. 2, 2011 issue of the Digest).

HB 6001 merges the Connecticut Development Authority with Connecticut Innovations and expands the board of directors from 15 to 17 members. The two agencies make and guarantee business loans, provide financing for business and infrastructure projects and invest venture capital in early stage technology-based businesses. The merger, which was part of Gov. Daniel Malloy's 2012 legislative agenda, is intended to improve efficiency and effectiveness of the agencies' programs. The goal of the combined entity is to stimulate business development by pairing an equity investment firm with a traditional bank lender to create a one-stop quasi-public agency responsible for investing in economic development agencies, according to an article in the Hartford Business Journal.

The bill also creates a Small Business Innovation Assistance program at the University of Connecticut (UConn) to assist small- and mid-size companies with R&D and development of advanced manufacturing technologies. UConn and the Connecticut Center for Advanced Technology, a nonprofit organization that helps manufactures improve their workforce, will collaborate to help businesses participating in the program. Other measures approved under the bill include:

  • Expansion of the governor's First Five initiative allowing preference to businesses that relocate overseas jobs to Connecticut; and,
  • New language clarifying that interest earned on Manufacturing Reinvestment Account (MRA) deposits does not count against the annual yearly maximum contribution. Through the MRA, businesses are encouraged to invest funds in expanding operations, purchasing equipment or workforce development.

During the regular session, which ended in May, lawmakers passed a bill (SB 80) to strengthen R&D efforts at colleges and universities by expanding authority of higher education institutions to create technology test beds by purchasing emerging technology for testing and evaluating. This allows universities to test new technologies, products or processes to assess commercial potential and the possible benefits to the state's economy.

Another bill signed into law, SB 78, opens the Live Here, Learn Here program to any student graduating from a public or private college in Connecticut or a health care training school. The program aims to keep talent in the state by helping students save money for a down payment on a home by segregating a portion of their income tax payments in a first-time home buyers' fund.

Virginia
The 2012-14 budget signed into law by Gov. Bob McDonnell restores funding for economic development and life sciences initiatives submitted by the governor as amendments to the approved budget (see the May 9, 2012 issue of the Digest). Lawmakers provided $5 million over two years — half of the funding initially requested by the governor — to establish a research consortium comprised of six universities that will contract with private entities, foundations and other government sources to capture and perform research in the biosciences. A dollar-for-dollar funding match is required.

The final budget also includes an additional $3 million in the second year of the biennium for the Growth Acceleration Program (GAP) and Commonwealth Research and Commercialization Fund (CRCF), which provide loans and matching grants to advance science and technology-based R&D and incentivize commercialization. This brings total funding to $3.2 million each year for GAP and $4.8 million each year for CRCF. Up to $1.5 million each year is designated for the SBIR and STTR matching fund program within the CRCF funds. The Center for Innovative Technology manages both funds.

The reenrolled version of the 2012-14 budget is available at: http://lis.virginia.gov/122/bud/budsum/HB1301re.pdf.

Colorado, Connecticut, Virginiastate budget, state tbed, manufacturing, higher ed, r&d, bio, commercialization, sbir