VaBIO Advocating For “Founders’ Credit” In 2010 Legislative Session
The Virginia Biotechnology Association today announced that it will be advocating for enhanced incentives to stimulate access to capital for emerging bioscience companies during the 2010 session of the Virginia General Assembly.
“Even before the credit crisis the major challenge facing life science company start-ups and young companies has been access to capital. Without it, bioscience companies cannot create new jobs and are even struggling to hold on to the staff they have,” said Mark A. Herzog, executive director of the Virginia Biotechnology Association (VaBIO). “Investors are skittish and banks are slow to lend due to the global economic crisis. Therefore, we recommend an innovative approach to help this industry which has even fewer options in today’s climate.”
VaBIO’s proposal, the “Virginia Innovation Investment Act”, is a capital gains exclusion on income earned from a qualified investment in an advanced technology company in Virginia. The idea, based on the “Founders’ Credit” initiative promoted in 2009 by North Carolina Governor Bev Purdue, is designed to improve the availability of funding for the companies immediately without having to make a large appropriation of state dollars in a tight budget climate.
“It is an attractive proposal for policy-makers,” said Herzog. “The state budget is so tight that they do not have the resources for new programs that have a big price tag. This idea promotes private sector investment, in private sector jobs, and the only cost is far down the road when the venture is successful enough to be sold for a profit.”
The Virginia Innovation Investment Act proposal will be carried in the 2010 session by Delegate Sam Nixon (R-Chesterfield) and Senator Mark Herring (D-Loudoun), legistlators who are both strong advocates for economic development, especially relating to 21st Century industries such as biotechnology that pay higher than average taxes and employee wages.
“If this legislation passes, Virginia will be in a position to make it clear to investors that our state encourages and rewards job creation,” said Dr. David Ayares, the CEO of Revivicor, Inc., a biotechnology company in Blacksburg and chairman of the VaBIO board of directors. “This initiative will generate new companies, new jobs, new taxpayers for Virginia and, ultimately, new therapeutic products that treat disease and bring hope to those who are suffering.”
For more information, please contact the Virginia Biotechnology Association at (804) 643-6360 or on the web at www.vabio.org.
