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House Co-Sponsorship Memoranda
House of Representatives
Session of 2013 - 2014
Regular Session
MEMORANDUM
| Posted: | January 29, 2013 02:39 PM |
|---|---|
| From: | Representative Warren Kampf and Rep. Joseph T. Hackett |
| To: | All House members |
| Subject: | InnovatePA Program (Former HB 2633) |
| In the near future, we plan to reintroduce legislation to create the Innovate Pennsylvania Program to provide for venture capital investments in the Commonwealth’s job-creating technology industry. This legislation was introduced last session as House Bill 2633. As we recover from the recession, our economy is evolving. Pennsylvania is in a unique position to take advantage of our innovative environment to strengthen high-growth companies in industries that create good paying, quality jobs. Due to recent budget shortfalls and our struggling economy, the funding stream dedicated to making investments in this sector has been significantly cut over the years from $53 million to just over $14 million. The potential for job growth and business expansion in this industry is limitless. The state often sees a dramatic return on investment in these programs dedicated to supporting science and technology innovation. Being able to identify capital for investment in these companies is essential to future success and prevents the loss of huge gains the Commonwealth has already made in this arena. The Innovate Pennsylvania Program provides a new funding source for these companies that do not rely on existing monies. The program will offer $175 million of deferred premium tax credits to qualified insurance companies who pay the insurance premium tax in the Commonwealth at a discounted rate. These companies will bid for the tax credits. Once the tax credits have been sold, the revenue from the sale will be transferred to the Ben Franklin Technology Development Authority to distribute to the Ben Franklin Technology Partners and the Venture Investment Program. Funds will also be provided to the state’s regional biotechnology centers, also known as the Life Science Greenhouses. The BFTDA has the ability to invest and deploy capital to qualifying businesses and also has existing strict guidelines in place for reporting and auditing requirements. Participating insurance companies will receive the tax credits once capital has been pledged but may not begin using them until 2015. The total amount of tax credits claimed may not exceed $35 million each year. This innovative strategy will allow for investments to be made immediately and, in turn, overall revenue will increase from new jobs and businesses to offset any fiscal impact of the credit once it is redeemed in future years. |
Introduced as HB898