S T A T E O F N E W Y O R K
________________________________________________________________________
4566
2013-2014 Regular Sessions
I N A S S E M B L Y
February 6, 2013
___________
Introduced by M. of A. KOLB, OAKS, WALTER, MONTESANO, PALMESANO,
P. LOPEZ, GOODELL, RAIA, HAWLEY, BARCLAY -- Multi-Sponsored by -- M.
of A. CERETTO, KEARNS, LOSQUADRO, REILICH -- read once and referred to
the Committee on Economic Development
AN ACT to amend the economic development law, in relation to establish-
ing the New York business incubator network; and to amend chapter 53
of the laws of 2012 appropriating money for aid to localities, in
relation to providing additional funding for technology development
organization matching grants
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Legislative intent. The legislature hereby recognizes that
New York needs to support a statewide network of academic affiliated
business incubators. The New York business incubator network is designed
to accelerate the growth and success of entrepreneurial companies
through an array of business support resources and services that include
physical space, capital, coaching, common services, and networking
connections. Start-up and early-stage businesses will be selected on a
competitive basis to receive support under the program. Each business
incubator will utilize a system of best practices as established by the
division of science, technology and innovation to provide a cost effec-
tive approach to supporting start-up and early stage companies. Addi-
tional appropriation authority included in this bill will provide opera-
tional support for these incubators as well as increase funding for
technology transfer officers and assist in the transition technological
breakthroughs with commercial potential from the laboratory to the
marketplace. This investment in university affiliated business incuba-
tors will support regional development and local economic diversifica-
tion, job creation, and the retention of the state's vast resources of
intellectual capital.
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD03319-01-3
A. 4566 2
S 2. The economic development law is amended by adding a new section
361 to read as follows:
S 361. NEW YORK BUSINESS INCUBATOR NETWORK. THE COMMISSIONER, IN COOP-
ERATION WITH THE DIVISION OF SCIENCE, TECHNOLOGY AND INNOVATION IS
AUTHORIZED TO ACCEPT APPLICATIONS AND DESIGNATE INCUBATORS AS PART OF
THE NEW YORK BUSINESS ACADEMIC INCUBATOR NETWORK. SUCH DESIGNATIONS
SHALL BE MADE IN ACCORDANCE WITH THE STANDARDS AND CRITERIA SET FORTH IN
SUBDIVISION TWO OF THIS SECTION. INCUBATORS SO DESIGNATED SHALL BE
ELIGIBLE FOR SUPPORT FROM THE URBAN DEVELOPMENT CORPORATION, AND FOR
SUCH ADDITIONAL SUPPORT AS MAY OTHERWISE BE PROVIDED BY LAW.
1. AS USED IN THIS SECTION: (A) "INCUBATOR" MEANS AN ACADEMIC INCUBA-
TOR FACILITY AS DEFINED IN SUBPARAGRAPH (VI) OF PARAGRAPH (E) OF SUBDI-
VISION TWELVE-G OF SECTION TWO HUNDRED TEN OF THE TAX LAW;
(B) "APPLICANT" MEANS A COLLEGE OR UNIVERSITY, OR COLLEGE OR UNIVERSI-
TY-AFFILIATED RESEARCH INSTITUTE OR FOUNDATION PROVIDING A BASE FOR AN
INCUBATOR; AND
(C) "DIVISION" MEANS THE DIVISION OF SCIENCE, TECHNOLOGY AND INNO-
VATION.
2. THE DIVISION SHALL:
(A) IDENTIFY GEOGRAPHIC AREAS WITH THE GREATEST POTENTIAL FOR GROWTH
AND DEVELOPMENT IN NEW YORK STATE AND TECHNOLOGICAL AREAS THAT ARE
RELATED TO THE ENHANCEMENT OF PRODUCTIVITY IN VARIOUS INDUSTRIES LOCATED
THROUGHOUT NEW YORK STATE;
(B) AID IN THE ESTABLISHMENT OF INCUBATORS AT ACCREDITED UNIVERSITIES
AND COLLEGES THROUGHOUT THE STATE TO THE EXTENT POSSIBLE IN AREAS WHERE
THERE IS NOT ALREADY SIGNIFICANT SUPPORT FOR BUSINESS INCUBATION;
(C) PURSUANT TO THE STANDARDS ADHERING TO AN INCUBATOR, ESTABLISH
CONGRUENT CRITERIA THAT APPLICANTS MUST SATISFY FOR DESIGNATION AS AN
INCUBATOR FOR THE PURPOSES OF A DESIGNATION AS A MEMBER OF THE NETWORK,
INCLUDING, BUT NOT LIMITED TO THE FOLLOWING:
(I) AN ESTABLISHED RECORD OF, OR PLAN TO CONFORM TO, BEST PRACTICES
INCLUDING CLEAR POLICIES FOR BUSINESS ENTRY AND GRADUATION;
(II) A COMPREHENSIVE SUITE OF ENTREPRENEURIAL MENTORING PRACTICES
INCLUDING ADVISING, COACHING, PLANNING AND CONNECTING TO FUNDING SOURC-
ES;
(III) THE CAPACITY TO SECURE SUBSTANTIAL PRIVATE AND OTHER NON-STATE
GOVERNMENTAL FUNDING FOR THE PROPOSED INCUBATOR, NOT INCLUDING DIRECT
SUPPORT FROM THE SPONSORING ACADEMIC INSTITUTION OR RELATED FOUNDATION,
IN AMOUNTS AT LEAST EQUAL TO THE TOTAL OF SUPPORT SOUGHT FROM THE STATE
OR ITS DIVISIONS;
(IV) THE ABILITY AND WILLINGNESS TO COOPERATE AND COORDINATE WITH
SMALL BUSINESS DEVELOPMENT CENTERS AND WITH OTHER LOCAL, REGIONAL AND
STATEWIDE ECONOMIC DEVELOPMENT ORGANIZATIONS, STATEWIDE BUSINESS INCUBA-
TOR ASSOCIATIONS, BUSINESS SUPPORT NETWORKS, VENTURE AND ANGEL CAPITAL
FUNDING SOURCES, AND WORKFORCE DEVELOPMENT ADVOCATES; AND
(V) THE CAPACITY TO COLLABORATE WITH BUSINESS AND INDUSTRY INDIVIDUAL-
LY AND AS PART OF A STATEWIDE INCUBATOR ASSOCIATION;
(D) ESTABLISH SUCH REQUIREMENTS AS IT DEEMS APPROPRIATE FOR THE
FORMAT, CONTENT AND FILING OF APPLICATIONS FOR DESIGNATION AS INCUBA-
TORS;
(E) ESTABLISH SUCH PROCEDURES AS IT DEEMS APPROPRIATE FOR THE EVALU-
ATION OF APPLICATIONS FOR DESIGNATION AS INCUBATORS, INCLUDING THE
ESTABLISHMENT OF A REVIEW PANEL COMPOSED OF STATEWIDE RECOGNIZED EXPERTS
IN BUSINESS INCUBATION; AND
A. 4566 3
(F) UPON THE APPROVAL OF AN APPLICATION BY THE COMMISSIONER, CONFER AN
INCUBATOR DESIGNATION UPON A SUCCESSFUL APPLICANT UNLESS OTHERWISE
REVOKED BY THE COMMISSIONER IN CONSULTATION WITH THE DIVISION.
3. THE COMMISSIONER SHALL APPROVE AND PROMULGATE RULES AND REGULATIONS
FOR SELECTION OF INCUBATORS AND SHALL MAKE FINAL DESIGNATIONS REGARDING
ALL MATTERS RELATING TO THE STATUS OF AN APPLICANT OR INCUBATOR.
4. (A) (I) FROM SUCH FUNDS AS MAY BE APPROPRIATED OR OTHERWISE AUTHOR-
IZED FOR THIS PURPOSE BY THE LEGISLATURE, THE URBAN DEVELOPMENT CORPO-
RATION SHALL PROVIDE FINANCIAL SUPPORT, THROUGH CONTRACTS OR OTHER
MEANS, TO ENHANCE AND ACCELERATE THE DEVELOPMENT OF SUCH INCUBATORS.
FUNDS RECEIVED PURSUANT TO THIS SUBDIVISION MAY BE USED FOR PURCHASE OF
EQUIPMENT AND FIXTURES, EMPLOYMENT OF TECHNOLOGY TRANSFER STAFF AND
PROVISION OF INTERNSHIPS SERVING THE INCUBATOR, BUT NOT PRIMARILY SERV-
ING AS EMPLOYEES OF MEMBER FIRMS LEASING SPACE IN AN INCUBATOR, AND
OTHER PURPOSES APPROVED BY THE DIVISION, BUT MAY NOT BE USED FOR CAPITAL
CONSTRUCTION OF REAL PROPERTY. PARTICIPATING BUSINESS INCUBATORS SHALL
BE ELIGIBLE FOR COMPETITIVE GRANTS UP TO TWO HUNDRED THOUSAND ANNUALLY,
IF MATCHED AT A RATE OF 1AGING BY PRIVATE INVESTMENT.
(II) BEGINNING IN THE FOURTH ACADEMIC YEAR FOLLOWING THE ACADEMIC YEAR
IN WHICH AN INCUBATOR IS FIRST DESIGNATED, THE INCUBATOR SHALL PRESENT
TO THE COMMISSIONER A BIANNUAL REPORT CATALOGING ITS REVENUE AND
EXPENSES, THE NUMBER OF PRIVATE SECTOR FIRMS THAT HAVE LEASED SPACE IN
THE INCUBATOR, THE NUMBER OF COMPANIES THAT HAVE GRADUATED FROM AN INCU-
BATOR, WHETHER SUCH GRADUATING COMPANIES HAVE REMAINED IN NEW YORK
STATE, AND BEST ESTIMATES AS TO THE NUMBER OF FULL TIME EQUIVALENT POSI-
TIONS CREATED BY INCUBATOR MEMBER COMPANIES AND THEIR SUCCESSORS FOR A
PERIOD OF FIVE YEARS UPON GRADUATION. THE DIVISION SHALL EVALUATE SUCH
INCUBATOR'S PERFORMANCE ACCORDING TO THE ABOVE LISTED CRITERIA, AND
SHALL PRESENT ITS FINDINGS TO THE COMMISSIONER WHO SHALL MAKE A BINDING
RECOMMENDATION WHETHER SUCH INCUBATOR SHALL RETAIN ITS STATUS AS A
MEMBER OF THE NETWORK.
(III) THE DIVISION CAN RECOMMEND, SUBJECT TO THE APPROVAL OF THE
COMMISSIONER, ADDITIONAL MEMBERS TO THE NETWORK ACCORDING TO THE CRITE-
RIA ESTABLISHED IN SUBDIVISION TWO OF THIS SECTION.
(B) ADDITIONAL FUNDING OF THE OPERATIONS OF EACH INCUBATOR RECIPIENT
IN THE NETWORK SHALL BE BASED UPON A SHOWING THAT: THE INCUBATOR CONTIN-
UES TO COMPLY WITH THE CRITERIA ESTABLISHED BY THE COMMISSIONER IN
CONSULTATION WITH THE DIVISION PURSUANT TO PARAGRAPH (B) OF SUBDIVISION
TWO OF THIS SECTION; A DEMONSTRATION OF ASSISTANCE TO EMERGING BUSI-
NESSES IN NEW YORK STATE; COMPLIANCE WITH THE RULES, REGULATIONS AND
GUIDELINES OF THE URBAN DEVELOPMENT CORPORATION, IN PARTICULAR, AND THE
DIVISION; AND COMPLIANCE WITH ANY CONTRACTS BETWEEN THE URBAN DEVELOP-
MENT CORPORATION AND THE DESIGNATED INCUBATOR.
(C) EACH INCUBATOR SHALL REPORT TO THE COMMISSIONER IN A MANNER AND
ACCORDING TO THE SCHEDULE ESTABLISHED BY THE DIVISION, AND SHALL PROVIDE
SUCH ADDITIONAL INFORMATION AS THE COMMISSIONER MAY REQUIRE. THE DIVI-
SION SHALL EVALUATE INCUBATOR OPERATIONS USING METHODS SUCH AS SITE
VISITS, REPORTING OF SPECIFIED INFORMATION AND REVIEW EVALUATIONS USING
EXPERTS IN ENTREPRENEURIAL DEVELOPMENT. IF THE DIVISION IS UNSATISFIED
WITH THE PROGRESS OF AN INCUBATOR MEMBER IT SHALL NOTIFY SUCH INCUBATOR
OF THE RESULTS OF ITS EVALUATIONS AND FINDINGS OF DEFICIENCIES IN THE
OPERATION OF SUCH INCUBATOR AND SHALL ALLOW AND COOPERATE WITH SUCH
INCUBATORS TO REMEDY SUCH FINDINGS IN A TIMELY MANNER. IF SUCH FACTORS
ARE NOT REMEDIED, THE COMMISSIONER MAY WITHDRAW THE STATE FUNDING
SUPPORT, IN PART UNTIL SUCH DEFICIENCIES ARE REMEDIED, OR IN WHOLE IMME-
DIATELY FOLLOWING THE WITHDRAWAL OF AN INCUBATOR NETWORK DESIGNATION.
A. 4566 4
5. BEGINNING NO LATER THAN THE END OF THE FOURTH YEAR OF THE FORMATION
OF THE NETWORK, THE COMMISSIONER SHALL MAKE A BIANNUAL REPORT OF THE
INCUBATOR NETWORK PROGRAM TO THE GOVERNOR, THE SPEAKER OF THE ASSEMBLY,
THE TEMPORARY PRESIDENT OF THE SENATE, THE MINORITY LEADER OF THE ASSEM-
BLY, THE MINORITY LEADER OF THE SENATE, THE LEGISLATIVE COMMITTEES ON
ECONOMIC DEVELOPMENT AND TO THE FISCAL COMMITTEES NOT LATER THAN DECEM-
BER THIRTY-FIRST OF EACH ENUMERATED YEAR. SUCH REPORT SHALL INCLUDE, BUT
NOT BE LIMITED TO, A LIST OF IMMEDIATE PAST AND ACTIVE TENANTS OF THE
INCUBATORS IN THE NETWORK, THE RESULTS OF THE DIVISION'S EVALUATION OF
EACH INCUBATOR, A DESCRIPTION OF THE ACHIEVEMENTS OF EACH INCUBATOR, ANY
DEFICIENCIES IN THE OPERATION OF EACH INCUBATOR, REMEDIAL ACTIONS RECOM-
MENDED BY THE DIVISION, REMEDIAL ACTIONS TAKEN BY THE INCUBATOR, A
DESCRIPTION OF BUSINESS ASSISTANCE PROVIDED BY EACH INCUBATOR, A
DESCRIPTION OF ANY EXTERNAL FUNDING ATTRACTED BY THE INCUBATOR, PARTNER-
SHIPS ENTERED INTO BY THE INCUBATOR, THE AMOUNT OF FINANCIAL ASSISTANCE
PROVIDED BY THE STATE, INCLUDING THE URBAN DEVELOPMENT CORPORATION, AND
THE LEVEL OF MATCHING FUNDS PROVIDED EACH INCUBATOR, AND A DESCRIPTION
OF THE USE OF SUCH MONIES TO THE EXTENT THAT SUCH DISCLOSURE DOES NOT
COMPROMISE GENERALLY ACCEPTED BUSINESS CONFIDENTIALITY STANDARDS.
S 3. Section 1 of chapter 53 of the laws of 2012, enacting the aid to
localities budget, is amended by repealing the items herein below set
forth in brackets and by adding to such section the items underscored in
this section.
DEPARTMENT OF ECONOMIC DEVELOPMENT
AID TO LOCALITIES 2012-13
HIGH TECHNOLOGY PROGRAM
General Fund
Local Assistance Account
Technology development organization matching grants, to
be awarded on a competitive basis in accordance with
the provisions of section 3102-d of the public author-
ities law. Notwithstanding any inconsistent provision
of law, the director of the budget may suballocate up
to the full amount of this appropriation to any
department, agency or authority. No funds shall be
expended from this appropriation until the director of
the budget has approved a spending plan .. [1,382,000] 3,382,000
S 4. This act shall take effect immediately.