Bill Text: NY A01111 | 2009-2010 | General Assembly | Amended

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Bill Title: Creates the small business technology investment program; requires reporting by regional investment funds receiving investments and requires the foundation to report to the governor and legislature a summary of the program and an evaluation of reports submitted by the funds.

Spectrum: Partisan Bill (Democrat 21-0)

Status: (Engrossed - Dead) 2010-03-01 - enacting clause stricken [A01111 Detail]

Download: New_York-2009-A01111-Amended.html

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                           S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________
                                        1111--A
                              2009-2010 Regular Sessions
                                 I N  A S S E M B L Y
                                      (PREFILED)
                                    January 7, 2009
                                      ___________
       Introduced  by  M. of A. DelMONTE, SCHIMMINGER, KOON, GABRYSZAK, JAFFEE,
         LUPARDO, MAGNARELLI, FIELDS -- Multi-Sponsored by -- M. of A. BRENNAN,
         COOK,   JOHN,   MAGEE,   MAISEL,    MAYERSOHN,    McENENY,    MILLMAN,
         PEOPLES-STOKES, REILLY, ROBINSON, SWEENEY, WEISENBERG -- read once and
         referred  to  the  Committee  on  Economic  Development, Job Creation,
         Commerce and Industry -- committee discharged, bill  amended,  ordered
         reprinted as amended and recommitted to said committee
       AN  ACT to amend the public authorities law, in relation to creating the
         small business technology investment fund
         THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
       BLY, DO ENACT AS FOLLOWS:
    1    Section  1.  The  public  authorities  law  is amended by adding a new
    2  section 3154-a to read as follows:
    3    S 3154-A. THE SMALL BUSINESS TECHNOLOGY INVESTMENT  FUND.  1.    DEFI-
    4  NITIONS. FOR THE PURPOSES OF THIS SECTION, THE FOLLOWING WORDS AND TERMS
    5  SHALL  HAVE  THE  FOLLOWING  MEANINGS  UNLESS THE CONTEXT SHALL INDICATE
    6  ANOTHER OR DIFFERENT MEANING OR INTENT:
    7    (A) "REGIONAL INVESTMENT FUND" SHALL MEAN  A  LIMITED  PARTNERSHIP,  A
    8  LIMITED   LIABILITY  PARTNERSHIP,  A  LIMITED  LIABILITY  COMPANY  OR  A
    9  NOT-FOR-PROFIT FUND THAT IS PROFESSIONALLY  MANAGED  BY  AN  EXPERIENCED
   10  FUND  MANAGER,  IS FORMED FOR THE PURPOSE OF PROVIDING PRIVATE EQUITY TO
   11  TECHNOLOGY-BASED COMPANIES IN THEIR  FORMATIVE  STAGES,  ENCOMPASSES  AT
   12  LEAST  TWO COUNTIES, AND INVESTS IN QUALIFIED ENTERPRISES LOCATED WITHIN
   13  NEW YORK STATE.
   14    (B) "QUALIFIED ENTERPRISE" SHALL MEAN A COMPANY OR A PROPOSED  COMPANY
   15  THAT  HAS  OR  WILL  LOCATE  ITS PRINCIPAL PLACE OF BUSINESS IN NEW YORK
   16  STATE, THAT IS, OR PROPOSES TO BE, ENGAGED IN THIS STATE IN RESEARCH AND
   17  DEVELOPMENT OR MANUFACTURING, AND THAT DEMONSTRATES  THE  POTENTIAL  FOR
   18  SUBSTANTIAL  GROWTH  AND JOB DEVELOPMENT IN AN EMERGING TECHNOLOGY FIELD
        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
       A                                                          LBD01213-02-9
       A. 1111--A                          2
    1  AS DEFINED IN SECTION THIRTY-ONE HUNDRED TWO-E OF  THIS  ARTICLE  OR  AS
    2  ADOPTED BY THE BOARD.
    3    (C)  "SEED  CAPITAL"  SHALL  MEAN  FINANCIAL ASSISTANCE TO A QUALIFIED
    4  ENTERPRISE,  WHICH  HAS  FORMULATED  A  DETAILED  BUSINESS   PLAN,   FOR
    5  PROOF-OF-CONCEPT OR INITIAL PRODUCT COMMERCIALIZATION.
    6    2.  INVESTMENTS  IN  REGIONAL  INVESTMENT FUNDS. (A) THE FOUNDATION IS
    7  AUTHORIZED TO MAKE INVESTMENTS TO ENCOURAGE AND FACILITATE THE  CREATION
    8  OR  EXPANSION  OF  REGIONAL  INVESTMENT FUNDS THAT SERVE THE PURPOSES OF
    9  THIS SECTION. THE FOUNDATION'S BOARD OF DIRECTORS SHALL  ADOPT  CRITERIA
   10  AND GUIDELINES GOVERNING SUCH INVESTMENTS, WHICH SHALL REQUIRE THAT:
   11    (I) THERE EXISTS A NEED FOR SEED CAPITAL IN THE REGION SERVED OR TO BE
   12  SERVED BY A REGIONAL INVESTMENT FUND;
   13    (II)  SUPPORT FOR A REGIONAL INVESTMENT FUND EXISTS FROM LOCAL GOVERN-
   14  MENTS, ECONOMIC DEVELOPMENT AGENCIES, AND  BUSINESS  COMMUNITIES  WITHIN
   15  THE REGION OR AREA TO BE SERVED BY SUCH FUND;
   16    (III) THE REGIONAL INVESTMENT FUND HAS THE CAPACITY TO PROVIDE MANAGE-
   17  MENT  EXPERTISE  AND  OTHER VALUE-ADDED SERVICES TO ITS PORTFOLIO COMPA-
   18  NIES;
   19    (IV) THE REGIONAL  INVESTMENT  FUND  ESTABLISHES  CONFLICT-OF-INTEREST
   20  PROVISIONS ACCEPTABLE TO THE FOUNDATION;
   21    (V)  TO THE MAXIMUM EXTENT FEASIBLE, THE REGIONAL INVESTMENT FUND WILL
   22  INVEST IN FIRMS WHICH HAVE THE GREATEST POTENTIAL FOR JOB CREATION;
   23    (VI) INVESTMENTS MADE BY THE FOUNDATION IN A REGIONAL INVESTMENT  FUND
   24  SHALL  NOT  EXCEED  TWO  MILLION  DOLLARS  AND  SHALL  BE MATCHED BY THE
   25  REGIONAL FUND ON AT LEAST A ONE-TO-ONE BASIS  WITH  MONIES,  OTHER  THAN
   26  STATE MONIES; AND
   27    (VII)  INVESTMENTS  MADE  BY  A  REGIONAL INVESTMENT FUND THAT INCLUDE
   28  FUNDS RECEIVED FROM THE FOUNDATION SHALL BE MADE ONLY FOR THE  FINANCING
   29  AUTHORIZED BY SUBDIVISION THREE OF THIS SECTION.
   30    (B)  THE  FOUNDATION  SHALL  MAKE  INVESTMENTS  IN  QUALIFIED REGIONAL
   31  INVESTMENT FUNDS VIA THE ISSUANCE OF A REQUEST FOR PROPOSALS TO REGIONAL
   32  AND LOCAL ECONOMIC  DEVELOPMENT  ORGANIZATIONS,  TECHNOLOGY  DEVELOPMENT
   33  ORGANIZATIONS,  RESEARCH UNIVERSITIES, AND INVESTMENT FUNDS THAT PROVIDE
   34  SMALL-SCALE INVESTMENTS IN HIGH-TECHNOLOGY COMPANIES IN NEW YORK STATE.
   35    3. REGIONAL INVESTMENT FUNDS. (A) REGIONAL INVESTMENT FUNDS  RECEIVING
   36  INVESTMENTS  FROM THE FOUNDATION UNDER THIS SECTION SHALL USE SUCH FUNDS
   37  AND THE REQUIRED MATCHING FUNDS TO PROVIDE SEED  CAPITAL  AND  FOLLOW-ON
   38  FINANCING  TO  QUALIFIED ENTERPRISES, PROVIDED THAT THE REGIONAL INVEST-
   39  MENT FUND SHALL NOT: (I) INVEST AN AMOUNT IN ANY SINGLE QUALIFIED ENTER-
   40  PRISE THAT EXCEEDS FIFTY PERCENT OF THE TOTAL INVESTMENT FROM ALL  OTHER
   41  SOURCES  IN  ANY SUCH ENTERPRISE; OR (II) INVEST OVER FIVE HUNDRED THOU-
   42  SAND DOLLARS IN ANY ONE COMPANY.
   43    (B) A REGIONAL INVESTMENT FUND, BEFORE APPROVING ANY  APPLICATION  FOR
   44  FINANCIAL  ASSISTANCE UNDER THIS SECTION SHALL FIND THAT: (I) THE QUALI-
   45  FIED ENTERPRISE AND ITS PRODUCT OR PROCESS HAVE A REASONABLE  CHANCE  OF
   46  BEING  COMMERCIALLY SUCCESSFUL; AND (II) THE EMPLOYMENT CREATED OR MAIN-
   47  TAINED AS A RESULT OF THE FUND'S INVESTMENT WILL BE IN NEW  YORK  STATE.
   48  THE REGIONAL INVESTMENT FUND SHALL FURTHER ENSURE THAT PROVISIONS ARE IN
   49  PLACE FOR THE REPAYMENT OF THE FUNDS IF THE COMPANY RECEIVING ASSISTANCE
   50  LEAVES THE STATE.
   51    4.  REGIONAL  INVESTMENT  FUND REPORTING. THE FOUNDATION SHALL REQUIRE
   52  ANY REGIONAL INVESTMENT FUND RECEIVING INVESTMENTS UNDER THIS SECTION TO
   53  FILE A REPORT WITH THE FOUNDATION BY DECEMBER FIRST, TWO THOUSAND ELEVEN
   54  AND ANNUALLY THEREAFTER UNTIL DECEMBER FIRST, TWO THOUSAND SIXTEEN. SUCH
   55  REPORT SHALL INCLUDE:
       A. 1111--A                          3
    1    (A) THE TOTAL AMOUNT OF FUNDS COMMITTED  TO  THE  REGIONAL  INVESTMENT
    2  FUND AND THE AMOUNT THAT HAS BEEN INVESTED;
    3    (B) THE NET ASSET VALUE OF THE FUND;
    4    (C)  THE  AMOUNT  INVESTED IN EACH PORTFOLIO COMPANY FROM THE FUND AND
    5  FROM OTHER SOURCES;
    6    (D) THE TYPE OF PRODUCT OR TECHNOLOGY BEING DEVELOPED BY EACH  PORTFO-
    7  LIO COMPANY;
    8    (E) THE LOCATION OF EACH PORTFOLIO COMPANY;
    9    (F) THE NUMBER OF JOBS PROJECTED TO BE CREATED AND RETAINED; AND
   10    (G) SUCH OTHER INFORMATION AS THE FOUNDATION DEEMS NECESSARY.
   11    5.  ASSETS  AND  LIABILITIES. ALL OF THE ASSETS AND LIABILITIES OF THE
   12  SMALL BUSINESS TECHNOLOGY INVESTMENT FUND SHALL BE  MADE  AVAILABLE  FOR
   13  THE  PURPOSES  OF  THIS  SECTION.  THE BOARD SHALL PREPARE A PLAN WITHIN
   14  NINETY DAYS FOLLOWING THE EFFECTIVE DATE OF THIS  SECTION  TO  LIQUIDATE
   15  ALL  CURRENT  ASSETS  AND  LIABILITIES  OF THE FUND. THE PUBLICLY-TRADED
   16  ASSETS AND ANY WORKING CAPITAL SHALL BE MADE FULLY AVAILABLE  FOR  ALLO-
   17  CATION  TO  REGIONAL  INVESTMENT FUNDS AS SOON AS PRACTICABLE. THE BOARD
   18  SHALL ALSO TAKE WHATEVER ACTIONS ARE NECESSARY TO LIQUIDATE THE  REMAIN-
   19  ING  ASSETS  OF THE SMALL BUSINESS TECHNOLOGY INVESTMENT FUND AS SOON AS
   20  PRACTICABLE, BUT NOT MORE THAN TWO YEARS FOLLOWING THE EFFECTIVE DATE OF
   21  THIS SECTION.
   22    6. REPORT OF THE FOUNDATION. THE FOUNDATION SHALL SUBMIT TO THE GOVER-
   23  NOR AND THE LEGISLATURE A SUMMARY AND EVALUATION OF THE REPORTS  SUBMIT-
   24  TED  TO  THE FOUNDATION PURSUANT TO SUBDIVISION FOUR OF THIS SECTION AND
   25  AN EVALUATION OF THE PERFORMANCE OF THE REGIONAL INVESTMENT FUNDS ON  OR
   26  BEFORE FEBRUARY FIRST, TWO THOUSAND TWELVE AND ANNUALLY THEREAFTER UNTIL
   27  FEBRUARY FIRST, TWO THOUSAND SEVENTEEN.
   28    S  2.  The opening paragraph of section 3150 of the public authorities
   29  law, as amended by section 4 of part C of chapter  63  of  the  laws  of
   30  2005, is amended to read as follows:
   31    As used in this [section] TITLE:
   32    S 3. This act shall take effect immediately.