Oregon Legislature Passes University Venture Development Funds Bill

The Oregon Legislature overwhelmingly passed S.B. 853 last week, creating venture development funds to facilitate technology commercialization for students and faculty at the state's seven public universities.

Under the legislation, revenue for the newly created funds will come from donors who, in turn, receive credit on their state income tax returns. The development funds will use capital raised through university foundations to bridge the gap between an idea and the point where private investors become interested.

Bill sponsor Frank Morse (R-Albany) said the program will have minimal impact on state revenue and will not cost the state money that would be spent on vital state services. Universities that license the inventions are required to return 20 percent of the royalty and licensing fees to the state treasury until the tax credit is recaptured. Proponents say the program has the potential to return millions as companies reimburse the state to cover the cost of credits and create jobs.

Purposes of the fund are to provide:

• Capital for university entrepreneurial programs;
• Opportunities for students to gain experience in applying research to commercialization activities;
• Proof-of-concept funding for transforming research and development concepts into commercially viable products and services;
• Entrepreneurial opportunities to transform research into commercial ventures that create jobs within the state; and,
• Tax credits for contributors to university commercialization activities.

The legislation also stipulates that grant applicants must remain within the state for at least five years following receipt of the grant, or repay the grant plus interest. Gov. Ted Kulongoski is expected to sign the bill.