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Maryland Budget Supports Tech and Biotech Industries

May 04, 2011

In support of Gov. Martin O'Malley's Bio 2020 Initiative, lawmakers increased funding for stem cell research and provided $8 million in tax credits for biotechnology investments in the FY12 budget approved last month. Lawmakers also passed a bill providing a two-year eligibility extension for companies using the biotech tax credit and allocated $2.4 million to fund nanobiotechnology projects.

The Maryland Technology Development Corporation (TEDCO) will receive $15.7 million in FY12, up from $13.9 million approved last year. This includes $12.4 million to administer the state's stem cell research fund (a $2 million increase) and $3.3 million for technology development, transfer and commercialization.

The budget also includes the governor's recommendation of $8 million for the biotechnology investment tax credit awarded for investments in qualified biotechnology companies and $3.8 million for the Maryland Biotech Center, which is responsible for promoting the biotechnology industry and providing resources for entrepreneurial programs. This reflects level funding for both initiatives. Another $2.4 million is included for the Maryland Industrial Development Financing Authority to develop in coordination with TEDCO a competitive grants program for nanobiotechnology research.

Lawmakers passed a bill during the session (HB 587) that temporarily increases the age ceiling for biotechnology companies applying for the Biotechnology Investment Tax Credit. The new law will apply to a company active for up to 15 years, up from the current 12-year limit, for fiscal years 2012 and 2013.

The InvestMaryland program (HB173), as previously reported in the April 20, 2011 issue of the Digest, will invest at least $70 million in startup and early stage companies in Maryland following passage by the legislature. The funding, which comes from auctioning premium tax credits to insurance companies, will be invested by private venture capital firms selected by the state's Maryland Venture Fund and an independent third party. The Maryland Venture Fund, founded in 1994, is expected to receive about $18 million.

The FY12 enrolled operating budget bill is available at: http://mlis.state.md.us/2011rs/bills/hb/hb0070e.pdf.