The download: Virginia legislature approves tech-friendly measures
Virginia's legislature wrapped up its session last week, passing to the governor's desk a budget and a host of bills that members of the commonwealth's biotechnology and high-tech industries have heralded as making the state more competitive with its neighbors.
A research and development tax credit that reimburses companies for some of the expenses associated with bringing new technologies to market was allotted $5 million, while other funds designed to match federal grants or provide investments tallied $10 million. The budget and bills still require Republican Gov. Robert F. McDonnell's signature.
Advocates said the measures allow Virginia to better compete with neighboring Maryland and North Carolina, which have made state incentives for research-intensive technology companies more of a priority. But while Virginia could now have a new bargaining chip to attract companies and grow those already there, the other states are not standing pat.
For instance, the Maryland General Assembly, whose session continues into April, is mulling over InvestMaryland, a proposal that would shore up $100 million for tech companies and that Gov. Martin O'Malley (D) has made a cornerstone of his economic growth plan.
Still, members of the Northern Virginia Technology Council and the Virginia Biotechnology Association called the session a resounding win. That's particularly true if one views the last few years together, they said.
Among the measures approved by the General Assembly:
-- R&D Tax Credits: The budget designates $5 million to help offset the expenses associated with running biotech and other research-intensive companies. It's the first time the commonwealth has approved such credits. But the $5 million will likely be stretched thin and could have minimal benefit as every company that qualifies is entitled to a check.
"We're grateful for this and if it is massively oversubscribed then that's a great argument to take back to the General Assembly next year and say this needs even greater resources attached to it," said VaBIO Executive Director Mark Herzog.
-- CIT "Gap" Fund: The state's Center for Innovative Technology makes early-stage investments in companies with technology that demonstrates commercial potential. Legislators put $4 million in that fund, building on $1.5 million from 2010.
"It's a positive trend and it shows the state is competing . . . to ensure that we grow our own companies in Virginia," said Josh Levi, NVTC's vice president for policy. "That's the new part for us. We've never really had that focus on us, from the state perspective, on growing our own and cultivating our own."
-- Commonwealth Research and Commercialization Fund: The CRCF, which had not been funded in the past, saw $6 million added to its coffers this session. Of that portion, $2 million is earmarked to match federal grants made by the National Institutes of Health through the SBIR program. The remainder is to invest in companies that generate jobs.
Bits and bytes
-- USA Mobility has seen its revenue streams erode over the last decade as much of its paging business was overtaken by the proliferation of cell phones. So the Springfield-based company is aiming to stem the tide with a $163.3 million deal to acquire Eden Prairie, Minn.-based Amcom Software. Amcom helps hospitals to integrate their communication across devices, such as smartphones, pagers and tablets.
-- January's snow storm forced the Northern Virginia Technology Council to postpone a ceremony for its annual Navigator Awards, which honor members of the business community who aid entrepreneurs. Steve Meltzer, a partner at Pillsbury Winthrop Shaw Pittman, bested two others to claim this year's Navigator Award. The Lifetime Navigator and Organizational Navigator awards were presented to Grotech's Don Rainey and Junior Achievement of the National Capital Area, respectively.