New Jersey-2022-A5063-Amended

An Act establishing the "Innovation Partnership" to promote certain emerging technology businesses and supplementing Title 52 of the Revised Statutes.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. a. The Legislature finds and declares that:

(1) New Jersey has been a hub for pharmaceutical, technology, medical research, and other science-related businesses for over a century;

(2) with the reestablishment of the New Jersey Commission on Science, Innovation¹[,]¹ and Technology (commission), the State is refocusing its efforts on attracting and fostering emerging technology business innovators so that New Jersey can continue to lead the nation in the fields of science and technology; and

(3) the "Innovation Partnership" shall work in tandem with the commission to fund these innovators and to ensure they have the support to continue with their work in this State.

b. The Legislature further finds and declares that:

(1) Beatrice Hicks, born in Orange, New Jersey in 1919, was one this State's most successful and important scientists and engineers;

(2) by the age of 13, after being inspired by the newly built Empire State Building and George Washington Bridge, Ms. Hicks believed her calling was to become an engineer;

(3) a graduate of Orange High School and the Newark College of Engineering, now known as the New Jersey Institute of Technology, Ms. Hicks went on to be the first woman engineer employed by Western Electric, where she pioneered the theoretical study, analysis, development, and manufacture of sensing devices, developed long-distance telephone technology, and ¹[a]¹ invented a crystal oscillator that generated radio frequencies used in aircraft communications;

(4) after working as an independent consultant, she assumed several leadership roles at her father's company, the Newark Controls Company;

(5) Ms. Hicks served as vice-president and chief engineer, and eventually president, of the Newark Controls Company, where she developed environmental sensors for heating and cooling systems that went on to be used in the United States' space program; and

(6) Ms. Hicks co-founded the Society of Women Engineers in 1950 after recognizing the lack of support and encouragement women received to pursue an education in engineering.

c. The Legislature therefore determines that, in honor of her trailblazing and independent spirit, her innovations and leadership in science and engineering, and her consciousness of the support needed to foster a community of innovators, this partnership shall be established.

2. As used in P.L. , c. (C. ) (pending before the Legislature as this bill):

"Commission" means the New Jersey Commission on Science, Innovation and Technology established pursuant to section 3 of P.L.1985, c.102 (C.52:9X-3).

"Emerging technology business" means a company that is doing business, employing or owning capital or property, or maintaining an office in this State, and has qualified research expenses paid or incurred for research conducted in this State, conducts pilot scale manufacturing in this State, or conducts technology commercialization in this State, in the fields of: advanced computing; cybersecurity¹[,];¹ financial information technology¹[,];¹ advanced materials; biotechnology; carbon footprint reduction technology; electronic device technology; information technology; life sciences; agriculture; aviation; medical device technology; mobile communications technology; renewable energy technology; or any field determined by the commission.

"Fund" means the account established pursuant to section 8 of P.L. , c. (C. ) (pending before the Legislature as this bill).

"Innovation Partner" or "partner" means a nonprofit organization certified or established and incorporated by the commission pursuant to sections 4 or 5 of P.L. , c. (C. ) (pending before the Legislature as this bill).

"Minority" means a person who is:

a. Black, which is a person having origins in any of the black racial groups in Africa or the Caribbean islands;

b. Hispanic, which is a person of Spanish or Portuguese culture, with origins in Mexico, South or Central America, or the Caribbean Islands, regardless of race;

c. Asian-American, which is a person having origins in any of the original peoples of the Far East, Southeast Asia, Indian subcontinent, Hawaii, or the Pacific Islands; or

d. American Indian or Alaskan native, which is a person having origins in any of the original peoples of North America.

"Minority emerging technology business" means an emerging technology business owned and controlled by a minority in which at least 51 percent of the ownership interest is held by minorities and the management and daily business operations of which are controlled by one or more of the minorities who own it.

"Nonprofit organization" means a nonprofit organization that is incorporated as a New Jersey nonprofit corporation pursuant to the "New Jersey Nonprofit Corporation Act," N.J.S.15A:1-1 et seq., is exempt from federal taxation pursuant to section 501(c)(3) of the federal Internal Revenue Code of 1986, 26 U.S.C. s.501(c)(3), or other federal tax exempt status as the commission determines to be appropriate, and may be established and incorporated by the commission for the purpose of identifying and generating business opportunities and financial assistance for emerging technology businesses.

"Private institution of higher education" and "public institution of higher education" shall have the same ¹[meaning] meanings¹ as provided in section 2 of P.L.1985, c.103 (C.18A:64J-2).

"Research institution" means any institution that conducts research and is approved by the commission for the purposes of P.L. , c. (C. ) (pending before the Legislature as this bill), which shall include, but not be limited to, private or public institutions of higher education, research hospitals, or public or private organizations within this State.

"Spin-out company" means a company that was developed within a larger company or a private or public institution of higher education that has become an independent company with separate employees and assets.

"Woman" or "women" means a female, females, or an individual or individuals whose gender identity is female, regardless of race.

"Women's emerging technology business" means an emerging technology business owned and controlled by a woman in which at least 51 percent of the ownership is held by women and the management and daily business operations of which are controlled by one or more women who own it.

3. a. The "Innovation Partnership," to be administered by the New Jersey Commission on Science, Innovation and Technology, shall be one or more independent nonprofit organizations, working individually, in partnership with each other, and in partnership with the commission, to advance the development of emerging technology businesses in this State and to create supportive and collaborative innovation ecosystems across New Jersey.

b. The goals and policies of the partners shall include, but not be limited to:

(1) identifying, developing, adapting, and implementing advanced technologies to enable the growth and competitiveness of emerging technology businesses through technology development, commercialization, and implementation;

(2) acting as regional facilitators and managers for interactions, programs, and initiatives by and among the commission, emerging technology businesses, economic development organizations, the corporate community, private and public institutions of higher education, research institutions, government, organized labor and other interests working collaboratively to advance the development of specialized innovation-based science and technology ecosystems in this State;

(3) directly providing, and serving as the conduit to, early-stage and later-stage public and private capital for emerging technology businesses;

(4) providing training or technical assistance to help emerging technology businesses apply to federal programs, such as the Small Business Innovation Research Program, under 15 U.S.C. s.631 and 15 U.S.C. s.638, for the purpose of attracting federal investment funds to this State;

(5) developing, providing, or supporting business incubation resources and space and facilitating the development of emerging technology business campuses, including discounted laboratory space to academic or executive emerging technology business spin-out companies;

(6) coordinating marketing efforts concerning existing State and local financial and material resources for emerging technology businesses;

(7) establishing and administering a research grant fund for the economic impact assessments of technology development projects conducted by private or public institutions of higher education that seek grant funding through the commission;

(8) establishing partnerships to support and enhance the scale, scope, and impact of initiatives that support the purpose and mission of the commission and the partners; and

(9) encouraging the advancement, development, and support of minority and women's emerging technology businesses to expand diversity and opportunity within that sector, with priority given to emerging technology businesses that demonstrate diversity in ownership or leadership, as applicable.

4. a. The commission shall select and certify, on a rolling basis in a timeframe determined by the commission, one or more nonprofit organizations to serve as partners in the "Innovation Partnership." Each partner shall be responsible for one or more of the following:

(1) the northern region of the State having a primary, but not exclusive, focus on financial information technology, cybersecurity, or a combination thereof;

(2) the central region of the State having a primary, but not exclusive, focus on healthcare, life sciences, biotechnology, or a combination thereof;

(3) the southern region of the State having a primary, but not exclusive, focus on agriculture, aviation, or a combination thereof; and

(4) the shore region of the State, having a primary, but not exclusive, focus on renewable energy and autonomous vehicles.

The commission shall establish the exact geographical boundaries of the four regions of each focus. Geographical boundaries may overlap and shall be drawn to allow for broad inclusions of existing partner sites, research institutions, and innovation ecosystems.

b. A nonprofit organization established as of the date of enactment of P.L. , c. (C. ) (pending before the Legislature as this bill), meeting at least one of the regional focus requirements of subsection a. of this section, may submit to the commission an application, in a form and manner determined by the commission, for certification as a partner.

c. In selecting and certifying a nonprofit organization as a partner, pursuant to subsection a. of ¹this¹ section, the commission shall give priority to:

(1) a nonprofit organization with a board of directors or leadership, as applicable, demonstrating diversity in ethnicity, race, or gender; and

(2) a nonprofit organization with at least one location in a municipality that meets the criteria for State aid pursuant to P.L.1978, c.14 (C.52:27D-178 et seq.).

5. a. If the commission is unable to certify a nonprofit organization as a partner¹[,]¹ pursuant to subsection ¹[b.] a.¹ of section 4 of P.L. , c. (C. ) (pending before the Legislature as this bill), the commission shall establish and incorporate an independent nonprofit organization to serve as a partner for one or more particular regional focuses.

b. The commission shall appoint the board of directors of each partner established pursuant to this section, in a number and manner to be determined by the commission, who shall be experts in the field of focus of each partner, who shall represent the public and private sectors, and who shall be appointed with due consideration to reflect the ethnic, racial, and gender diversity of the community in which the partner is located, including, but not limited to:

(1) one person representing academia;

(2) one person representing industry;

(3) one person having an expertise in leadership and entrepreneurship in an emerging technology business;

(4) one person representing a research institution; and

(5) one person having an expertise in investment, venture capital, or economic development concerning emerging technology businesses.

A vacancy in the membership of a board of directors shall be filled in the same manner as the original appointment.

c. Upon the establishment and appointment of the first board of directors of each partner, each board of directors shall adopt bylaws setting forth the structure, offices, powers, and duties of each partner.

d. The commission may modify or revoke a partner's certification as a partner if the commission determines, after receiving information submitted pursuant to section 7 of P.L. , c. (C. ) (pending before the Legislature as this bill), the partner does not achieve the goals or does not implement the policies of section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill).

6. a. A partner may apply to the commission, in a form and manner determined by the commission, to receive grant funds from the "Innovation Fund," established pursuant to section 8 of P.L. , c. (C. ) (pending before the Legislature as this bill), to implement the policies of section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill). The commission, upon approving a grant application submitted by a partner pursuant to this subsection, shall sign a grant agreement with the partner, which shall permit the partner to execute the goals and policies of section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill) only if matched by private sector funds on a minimum basis to be established by the commission.

b. Upon receipt of a grant pursuant to subsection a. of this section, a partner shall implement the terms of the grant agreement. Failure to comply with the grant agreement shall result in the forfeiture of the grant.

7. A partner shall annually submit the following information to the commission:

a. the partner's current mailing address, telephone number, and electronic mail address;

b. a copy of the partner's current bylaws;

c. a list of the partner's current officers, directors, and staff;

d. an independent audit covering all funds received from the State and funds received from State support, such as paybacks, reimbursements, investment returns, fees for services, cash reserves, interest, return of depreciation¹,¹ and any other similar forms of income that result at least partially from initial expenditure of State funds. The audit shall include all of the communications between the auditors and the managers of the partner. The audit shall be conducted in accordance with appropriate government auditing standards and shall be a public record;

e. upon the commission's request, an independent audit covering all funds received and partner activities supported by non-State funding sources; and

f. any other information the commission may require.

8. ¹[There] The "Innovation Fund"¹ is hereby established in the Department of the Treasury ¹as¹ a separate special, non-lapsing, account that shall be administered by the commission for the purpose of funding the partners, into which shall be deposited¹:¹ any State appropriations to the commission or to the partners, to technology and research activities assigned to the commission, or any other State appropriations for the purposes of P.L. , c. (C. ) (pending before the Legislature as this bill)¹[,];¹ federal funds¹[,];¹ royalties¹[,];¹ gifts¹[,];¹ grants¹[,];¹ bequests¹[,];¹ devises¹[,];¹ private funds¹[,];¹ venture capital funds¹[,];¹ and funds from any other source that are designated to the commission. All earnings received from the investment of monies in the fund shall be credited to the fund.

9. a. The commission is authorized to call upon any department, authority, commission, board, office, division, or agency of the State to provide any information, resources, or other assistance deemed necessary to effectuate the purposes of P.L. , c. (C. ) (pending before the Legislature as this bill).

b. Each department, authority, commission, board, office, division and agency of the State shall be required to cooperate with the commission to furnish the commission with any information, personnel, and assistance as is necessary to effectuate the purposes of P.L. , c. (C. ) (pending before the Legislature as this bill).

10. a. The commission shall annually issue a report to the Governor and, pursuant to section 2 of P.L.1991, c.164 (C.52:14-19.1), to the Legislature, describing the activities of the commission and each partner, which shall include, but not be limited to, the following:

(1) the budget of the commission and each partner;

(2) individual projects of the commission and each partner; and

(3) the progress of the commission and of each partner in achieving the goals and implementing the policies described in section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill).

b. Each partner shall submit information to the commission, at a time, form, and manner to be determined by the commission, which enables the commission to comply with the requirements of this section.

11. This act shall take effect immediately.