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A09671 Summary:

BILL NOA09671
 
SAME ASSAME AS S07546
 
SPONSORBuchwald
 
COSPNSRRodriguez, Fahy, Lavine, Mosley, Oaks, Stirpe, Rivera, Benedetto, Raia, Goodell
 
MLTSPNSRCrouch, Palmesano
 
Add 16-bb, amd 16-m, UDC Act
 
Establishes the New York state innovation voucher program; provides small businesses with access to research and development by colleges and universities, government laboratories and public research institutes in order to assist such businesses in the creation of innovative products or services.
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A09671 Actions:

BILL NOA09671
 
01/31/2018referred to small business
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A09671 Memo:

NEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A9671
 
SPONSOR: Buchwald
  TITLE OF BILL: An act to amend the urban development corporation act, in relation to establishing the New York state innovation voucher program   PURPOSE OR GENERAL IDEA OF BILL: This legislation creates the New York State "Innovation Vouchers" program. Under the program, Innovation Vouchers would go directly to small businesses, to provide dollar-for-dollar matching funds to acquire expertise from colleges and universities, government laboratories and public research institutes. A public-private partnership would be formed, connecting small businesses with research and development facil- ities to create jobs and innovation in New York.   SUMMARY OF SPECIFIC PROVISIONS: Section 1 defines the title as the "New York State Innovation Voucher Program Act." Section 2, Paragraph 1 establishes the New York State Innovation Voucher Program within the Empire State Development Corporation Section 2, Paragraph 2 defines the terms in the act. Section 2, Paragraph 3 describes the selection of eligible recipients. Section 2, Paragraph 4 requires the Empire State Development Corporation to identify a list of potential research and development partners in New York State, and post such list on their website, which would be required to be updated quarterly. Section 2, Paragraph 5 establishes Innovation Vouchers for up to $10,000 and requires the Empire State Development Corporation to institute criteria for voucher eligibility determination. In rare occasions, Inno- vation Vouchers of $50,000 may be awarded to an exceptional applicant. Recipients must match each voucher dollar-for-dollar, and may choose a research and development partner that they find compatible. The Empire State Development Corporation is authorized to establish a payment structure to the recipient through rules and regulations. Section 2, Paragraph 6 requires the Empire State Development Corporation to provide outreach to small businesses, including but not limited to minority- and women-owned enterprises and veteran-owned businesses. Section 2, Paragraph 7 requires periodic evaluation of the Innovative Voucher program to measure its economic impact. Section 2, Paragraph 8 authorizes the Empire State Development Corpo- ration use funds available under the Economic Development Fund (Section 16-m of the Urban Development Corporation Act) or from any other funds appropriated. Section 3 amends Section 16-m of the Urban Development Corporation Act to authorize the Innovative Vouchers program as an eligible program under the Economic Development Fund. Section 4 authorizes the Empire State Development Corporation to promul- gate rules and regulations. Section 5 sets the effective date.   JUSTIFICATION: Small businesses often do not have the resources needed to harness expertise in research and development. Meanwhile, scientific, technolog- ical and other research facilities have the capacity to provide insights and assistance to new projects. Funding the linkage between these two groups would lead to new opportunities for economic growth in New York State. Under this program, Innovation Vouchers would be issued directly to small businesses that apply. Small businesses would be selected based on the strength of their proposals and would then provide matching funds of their own to take advantage and demonstrate a commitment to the collaboration. The sum of the public and private monies would be directed toward universities, national laboratories and public research institutes for assisting the businesses with technical challenges for innovation. According to "The 2014 State New Economy Index" published by The Infor- mation Technology and Innovation Foundation (ITIF), this is an idea that has a recorded history of success in other countries, including Austria, Belgium, Canada, Denmark, Germany, the Netherlands, Ireland, and Sweden. Based on information from Senter Novem, an innovation agency in Holland, "eight out of ten vouchers issued resulted in an innovation that other- wise would not have come to fruition, and 80 percent of new R&D jobs created in Holland since 2005 are attributable to the vouchers." In addition, Connecticut's "Entrepreneur Innovation Award" program adminis- tered by the state's CT Next agency has proven that this is a concept that can be successful in the United States. The prospect of creating jobs for small businesses, while harnessing the innovation of our research institutions, argues strongly for bringing Innovation Vouchers to New York. The number of jobs created and the economic momentum fostered would be the metric used to measure the success of the program. Another significant performance metric that will be analyzed is the number patents produced as a result of the collab- orations.   FISCAL IMPLICATIONS: Undetermined.   IMPACT ON REGULATION OF BUSINESSES AND INDIVIDUALS: None.   LEGISLATIVE HISTORY: 2017: A. 1260A (Buchwald)- Passed Assembly / S. 817A (Funke) - Passed Senate Vetoed by Governor 2015/2016: A. 2126A (Buchwald) - Passed Assembly / S3894A (Funke) - Referred to Finance   EFFECTIVE DATE: This act shall take effect on the one hundred eightieth day after it shall have become a law; provided, however, that any rules or regu- lations necessary for the timely implementation of this act on its effective date may be promulgated on or before such effective date.
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A09671 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          9671
 
                   IN ASSEMBLY
 
                                    January 31, 2018
                                       ___________
 
        Introduced by M. of A. BUCHWALD -- read once and referred to the Commit-
          tee on Small Business
 
        AN  ACT  to  amend the urban development corporation act, in relation to
          establishing the New York state innovation voucher program
 
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:

     1    Section  1.  Short  title. This act shall be known and may be cited as
     2  the "New York state innovation voucher program act".
     3    § 2. Section 1 of chapter 174 of the laws of  1968,  constituting  the
     4  New York state urban development corporation act, is amended by adding a
     5  new section 16-bb to read as follows:
     6    § 16-bb. New York state innovation voucher program. (1) Program estab-
     7  lished.  There is hereby established a New York state innovation voucher
     8  program under the purview of the empire state  development  corporation.
     9  Such  program shall provide small businesses with access to research and
    10  development by colleges and universities,  government  laboratories  and
    11  public  research  institutes  in  order to assist such businesses in the
    12  creation of innovative products or services that provide  job  retention
    13  and expansion.
    14    (2) Definitions. For the purposes of this section, the following terms
    15  shall have the following meanings:
    16    (a)  "Eligible  recipient"  shall  mean small businesses as defined in
    17  section one hundred thirty-one of the economic development law.
    18    (b) "Eligible projects"  for  vouchers  authorized  pursuant  to  this
    19  section  shall  mean  research and development projects leading to inno-
    20  vation of products or services. Eligible costs shall include, but not be
    21  limited to, the development of prototypes, field testing, engineering or
    22  other projects authorized by the corporation that enhance innovation  of
    23  products  or  services  that result in job growth and business expansion
    24  within the state.
    25    (c) "Ineligible expense" shall mean reimbursement of time spent by the
    26  employees or owners of the small business; grant or voucher  application
    27  costs;  routine  and  readily-predictable  business expenses; design and
    28  production of marketing or  advertising  materials;  basic  professional
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD01581-05-8

        A. 9671                             2
 
     1  services  such  as  ongoing  routine  accounting, tax or legal services;
     2  building or equipment construction costs;  financing  fees;  travel  and
     3  entertainment  costs;  hospitality  costs; and any other expenses deemed
     4  ineligible by the corporation.
     5    (d)  "Research and development partner" shall mean colleges, universi-
     6  ties, state and national government laboratories,  and  public  research
     7  institutes in New York state.
     8    (e)  "Exceptionally  innovative  projects"  shall  mean  projects that
     9  demonstrate a potential for substantial economic growth and job develop-
    10  ment in an emerging technology field, as  defined  by  the  corporation,
    11  through the promulgation of rules and regulations, as emerging technolo-
    12  gy  fields  from  those  fields listed in subparagraphs one, two, three,
    13  four and five of paragraph (b) of subdivision one of section  thirty-one
    14  hundred two-e of the public authorities law.
    15    (3) Selection of eligible recipients. (a) Eligible recipients shall be
    16  selected  by  the  corporation based on the strength of their proposals,
    17  including evaluation of the innovative nature of the project, its  tech-
    18  nical  feasibility, commercial viability and the potential impact on the
    19  retention and creation of new jobs.
    20    (b) Small businesses may identify desired or  potential  research  and
    21  development  partners  as  part  of their applications. Advance determi-
    22  nations of the business' research and development partner shall not be a
    23  requirement for receipt of an innovation voucher.
    24    (c) Applications shall be judged by an advisory committee, or regional
    25  advisory committee,  appointed  by  the  president  of  the  corporation
    26  consisting  of  members of the higher education, science and technology,
    27  and business communities.
    28    (4) Research and development partners. The corporation shall  identify
    29  a  list of potential research and development partners in New York state
    30  that have appropriate facilities and resources  to  participate  in  the
    31  innovation  voucher  program  and  are  willing  to accept vouchers from
    32  eligible recipients for payment of their services. The list of potential
    33  research and development partners  shall  be  displayed  on  the  corpo-
    34  ration's website, and shall be reviewed and revised at least quarterly.
    35    (5)  Vouchers and matching funds. (a) The corporation, upon the recom-
    36  mendation of the advisory committee, may award vouchers up to ten  thou-
    37  sand  dollars  for each eligible project. Upon the recommendation of the
    38  advisory committee, the corporation may award a voucher in an amount  up
    39  to  fifty thousand dollars where a project is deemed exceptionally inno-
    40  vative. Criteria for determination of awards shall be established by the
    41  corporation in rules and regulations. Eligible  recipients  shall  match
    42  the  value  of  the voucher on a dollar-for-dollar basis and shall apply
    43  such amount to the voucher-funded project.
    44    (b) If an applicant is approved by the corporation for a voucher based
    45  on the merits of an eligible project, such eligible recipient  shall  be
    46  authorized  to  enter  into  a  working  agreement  with the appropriate
    47  research and development partner. The eligible  recipient  shall  notify
    48  the corporation of the research and development partner collaboration to
    49  be  formed  to  further research and development. Payment of the voucher
    50  shall be made based on a payment structure  established  by  the  corpo-
    51  ration  in rules and regulations promulgated pursuant to section four of
    52  this act to administer a collaboration.
    53    (6) Outreach. To ensure maximum awareness of  the  innovation  voucher
    54  program,  the  corporation shall develop and implement a plan to dissem-
    55  inate information and materials to small businesses, including  but  not

        A. 9671                             3
 
     1  limited to minority- and women-owned enterprises and veteran-owned busi-
     2  nesses.
     3    (7) Reports. The corporation shall post quarterly reports stating: the
     4  number  and  monetary  value  of  vouchers issued; the amount of program
     5  funding used for the vouchers; the recipient of  the  the  vouchers  and
     6  research  and  development partner; and any other appropriate metrics to
     7  measure the success of the program, including but not  limited  to,  the
     8  number  of jobs created or retained, the number of patents produced as a
     9  result of the collaboration, a description of the  economic  development
    10  impact and such other information as the corporation may deem necessary.
    11  Such  quarterly  reports  shall  also include a list of current advisory
    12  committee members and a list of current research and  development  part-
    13  ners approved by the corporation.
    14    (8) Funding. The corporation is authorized, within available appropri-
    15  ations  in  the  empire  state  development fund established pursuant to
    16  section sixteen-m of this act or from any other funds  appropriated,  to
    17  make innovative vouchers available to eligible recipients.
    18    §  3. Subdivision 1 of section 16-m of section 1 of chapter 174 of the
    19  laws of 1968, constituting the New York state urban  development  corpo-
    20  ration act, is amended by adding a new paragraph (o) to read as follows:
    21    (o)  Vouchers  to eligible entities as set forth in section sixteen-bb
    22  of this act to support the New York state innovation voucher program  to
    23  assist small business access to research and development by colleges and
    24  universities,  government laboratories and public research institutes to
    25  support such businesses  in  the  creation  of  innovative  products  or
    26  services.
    27    §  4.  Rules and regulations. The empire state development corporation
    28  is authorized to promulgate rules and regulations in accordance with the
    29  state administrative procedure act that are  necessary  to  fulfill  the
    30  purposes  of  this  act.  Such  rules and regulations shall be completed
    31  within one hundred eighty days after the effective date of this act.
    32    § 5. This act shall take effect on the one hundred eightieth day after
    33  it shall have become a law; provided, however, that  the  amendments  to
    34  subdivision 1 of section 16-m of section 1 of chapter 174 of the laws of
    35  1968, constituting the New York state urban development corporation act,
    36  made  by  section  three  of this act shall not affect the expiration of
    37  such section and shall be deemed to expire therewith; provided, further,
    38  that any rules and regulations necessary for the  timely  implementation
    39  of  this  act on its effective date may be promulgated on or before such
    40  effective date.
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