1.1                          A bill for an act 
  1.2             relating to economic development; creating the 
  1.3             biomedical innovation and commercialization 
  1.4             initiative; providing a tax credit; proposing coding 
  1.5             for new law in Minnesota Statutes, chapters 116J; 290. 
  1.6   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.7      Section 1.  [116J.885] [BIOMEDICAL INNOVATION AND 
  1.8   COMMERCIALIZATION INITIATIVE.] 
  1.9      Subdivision 1.  [ESTABLISHED.] The commissioner of trade 
  1.10  and economic development shall establish the biomedical 
  1.11  innovation and commercialization initiative (BICI) as a 
  1.12  collaborative economic development initiative between the 
  1.13  University of Minnesota, Minnesota's medical technology 
  1.14  industry, and investors.  BICI is not a state agency.  
  1.15     The board established in subdivision 2 shall organize and 
  1.16  operate BICI as a for-profit entity and in a manner and form 
  1.17  that the board determines best allows BICI to carry out its 
  1.18  objectives.  Total cash investment may not exceed $40,000,000.  
  1.19  Any distribution from BICI must be returned to all investors, 
  1.20  including the state, in the same proportion as funds were 
  1.21  invested.  The amount of credits granted is the amount of the 
  1.22  state cash investment and is a reduction in the investor's cash 
  1.23  investment for participation in any distribution under this 
  1.24  subdivision. 
  1.25     Subd. 2.  [BOARD.] BICI is governed by a board of 
  2.1   directors, appointed to six-year terms, comprised of: 
  2.2      (1) a representative chosen by the governor; 
  2.3      (2) a representative chosen by the University of Minnesota; 
  2.4   and 
  2.5      (3) five representatives from the state's medical 
  2.6   technology industry, chosen by private sector investors. 
  2.7      The board may use up to five percent of its total 
  2.8   capitalization to establish a management and administrative 
  2.9   budget, including the hiring of staff and for professional 
  2.10  management expenses.  Members of the staff are not state 
  2.11  employees. 
  2.12     Subd. 3.  [DUTIES OF BICI.] BICI shall: 
  2.13     (1) add business and financial expertise to technologies 
  2.14  that are being developed by University of Minnesota faculty and 
  2.15  staff to enhance commercial value; 
  2.16     (2) promote the depth, breadth, and value of technologies 
  2.17  being developed by the biomedical academic community; 
  2.18     (3) catalyze the development of functional, mutually 
  2.19  advantageous relationships between industry, faculty, staff, the 
  2.20  university, and extended research community; 
  2.21     (4) provide a financial return on commercialization efforts 
  2.22  to the stakeholders in BICI; and 
  2.23     (5) directly commercialize technologies through the startup 
  2.24  of new Minnesota companies or enhance the marketing of 
  2.25  technologies to existing companies creating expanded economic 
  2.26  development opportunities. 
  2.27     Subd. 4.  [STATEWIDE FOCUS.] BICI may contract and 
  2.28  collaborate with higher education and other research 
  2.29  institutions located throughout the state. 
  2.30     Subd. 5.  [POWERS OF BOARD.] The board has the power to do 
  2.31  all things reasonable and necessary to carry out the duties of 
  2.32  BICI including, without limitation, the power to: 
  2.33     (1) enter into contracts for goods and services with 
  2.34  individuals and private and public entities; 
  2.35     (2) sue and be sued; 
  2.36     (3) acquire, hold, lease, and transfer any interest in real 
  3.1   and personal property; 
  3.2      (4) accept appropriations, gifts, grants, and bequests; 
  3.3      (5) hire employees for BICI; and 
  3.4      (6) delegate any of its powers. 
  3.5      Subd. 6.  [BOARD COMPENSATION.] Compensation and expense 
  3.6   reimbursement of board members is as provided in section 
  3.7   15.0575, subdivision 1. 
  3.8      Sec. 2.  [290.0692] [BIOMEDICAL INNOVATION AND 
  3.9   COMMERCIALIZATION INITIATIVE CREDIT.] 
  3.10     (a) A tax credit is allowed for cash investments in the 
  3.11  biomedical innovation and commercialization initiative pursuant 
  3.12  to section 116J.885.  A credit is allowed against the tax 
  3.13  imposed by sections 290.03 and 290.06 equal to 25 percent of the 
  3.14  amount of the investment by the taxpayer for the year of the 
  3.15  investment. 
  3.16     (b) The amount of tax credits for a taxable year shall not 
  3.17  exceed the liability for tax.  "Liability for tax," for the 
  3.18  purposes of this section, means the tax imposed by sections 
  3.19  290.03 and 290.06 for the taxable year reduced by the amount of 
  3.20  nonrefundable credits allowed under this chapter.  The unused 
  3.21  portion of the credits shall be a biomedical innovation and 
  3.22  commercialization credit carryover for the tax year and each of 
  3.23  the subsequent nine succeeding taxable years.  The commissioner 
  3.24  shall prescribe the manner in which the credit may be claimed.  
  3.25  This may include allowing the credit only as a separately 
  3.26  processed claim for refund. 
  3.27     (c) The biomedical innovation and commercialization 
  3.28  initiative or any for-profit entity that is formed pursuant to 
  3.29  section 116J.885, subdivision 3, clause (5), must file an 
  3.30  information return with the commissioner in writing no later 
  3.31  than February 15 of each year.  The information return must 
  3.32  contain the total amount of investments in the biomedical 
  3.33  innovation and commercialization initiative or the for-profit 
  3.34  entity, the amount of investment made by each taxpayer, and the 
  3.35  taxpayer's name and Minnesota tax identification number. 
  3.36     <b>[EFFECTIVE DATE.]</b> This section is effective for tax years 
  4.1   beginning after December 31, 2000.