S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  4507--A
 
                        2023-2024 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             February 16, 2023
                                ___________
 
 Introduced by M. of A. KELLES -- read once and referred to the Committee
   on  Small  Business  --  committee  discharged,  bill amended, ordered
   reprinted as amended and recommitted to said committee
 
 AN ACT to amend the New York state urban development corporation act, in
   relation to establishing a matching grant program  for  certain  small
   businesses  receiving  funding  under the federal small business inno-
   vation research program or  the  small  business  technology  transfer
   program
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Section 1 of chapter 174 of the laws of 1968,  constituting
 the  New  York  state  urban  development corporation act, is amended by
 adding a new section 52-a to read as follows:
   § 52-A. SMALL BUSINESS INNOVATION RESEARCH AND SMALL BUSINESS TECHNOL-
 OGY TRANSFER MATCHING GRANT PROGRAM. 1. THE CORPORATION, IN CONSULTATION
 WITH THE DEPARTMENT OF ECONOMIC DEVELOPMENT'S DIVISION  FOR  SMALL-BUSI-
 NESS, SHALL ESTABLISH A MATCHING GRANT PROGRAM TO PROVIDE FUNDS TO SMALL
 BUSINESSES WHO HAVE BEEN AWARDED PHASE ONE OR PHASE TWO GRANTS UNDER THE
 FEDERAL SMALL BUSINESS INNOVATION RESEARCH PROGRAM OR THE SMALL BUSINESS
 TECHNOLOGY  TRANSFER  PROGRAM  WITHIN  THE  LAST FOUR YEARS. SUCH GRANTS
 SHALL BE AWARDED BASED ON A COMPANY'S  POTENTIAL  FOR  COMMERCIALIZATION
 AND JOB GROWTH. AS USED IN THIS SECTION, "SMALL BUSINESS" SHALL HAVE THE
 SAME  MEANING  AS PROVIDED  FOR IN SECTION ONE HUNDRED THIRTY-ONE OF THE
 ECONOMIC DEVELOPMENT LAW.
   2. THE MATCHING GRANT PROGRAM ESTABLISHED  PURSUANT  TO  THIS  SECTION
 SHALL  BE  STAGED  OVER A PERIOD OF THREE YEARS. THE FUNDING AMOUNTS FOR
 SUCH GRANT PROGRAM SHALL BE AS FOLLOWS:
   (A) FOR SMALL BUSINESSES THAT HAVE  BEEN  AWARDED  PHASE  ONE  FUNDING
 UNDER  THE  FEDERAL  SMALL  BUSINESS  INNOVATION RESEARCH PROGRAM OR THE
 SMALL BUSINESS TECHNOLOGY TRANSFER PROGRAM,  THE  AMOUNT  SHALL  BE  ONE
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD03425-03-3
 A. 4507--A                          2
              

 
 HUNDRED  THOUSAND  DOLLARS  IN YEAR ONE, TWO HUNDRED THOUSAND DOLLARS IN
 YEAR TWO, AND FIVE HUNDRED THOUSAND DOLLARS IN YEAR THREE.
   (B)  FOR  SMALL  BUSINESSES  THAT  HAVE BEEN AWARDED PHASE TWO FUNDING
 UNDER THE FEDERAL SMALL BUSINESS  INNOVATION  RESEARCH  PROGRAM  OR  THE
 SMALL  BUSINESS  TECHNOLOGY  TRANSFER  PROGRAM,  THE AMOUNT SHALL BE ONE
 HUNDRED THOUSAND DOLLARS IN YEAR ONE, TWO HUNDRED  THOUSAND  DOLLARS  IN
 YEAR TWO, AND FIVE HUNDRED THOUSAND DOLLARS IN YEAR THREE.
   3. (A) IN THE FIRST YEAR OF THE PROGRAM, TWENTY SMALL BUSINESSES SHALL
 BE AWARDED GRANTS OF ONE HUNDRED THOUSAND DOLLARS.
   (B)  IN  THE SECOND YEAR OF THE PROGRAM, TEN SMALL BUSINESSES SHALL BE
 CHOSEN FROM THE COMPANIES THAT WERE AWARDED A GRANT IN THE  FIRST  YEAR,
 TO RECEIVE GRANTS IN THE AMOUNT OF TWO HUNDRED THOUSAND DOLLARS.
   (C)  IN  THE THIRD YEAR OF THE PROGRAM, FOUR SMALL BUSINESSES SHALL BE
 CHOSEN FROM THE COMPANIES THAT WERE AWARDED A GRANT IN THE SECOND  YEAR,
 TO  RECEIVE  GRANTS OR EQUITY, DEPENDING ON THE SITUATION, IN THE AMOUNT
 OF FIVE HUNDRED THOUSAND DOLLARS.
   4. (A) SUCH FUNDS AWARDED PURSUANT TO THIS SECTION SHALL  BE  USED  TO
 EXPEDITE  COMMERCIALIZATION  AND  GENERALLY  USED  TO COVER EXPENSES NOT
 ALLOWED UNDER THE FEDERAL SMALL BUSINESS INNOVATION RESEARCH PROGRAM  OR
 THE SMALL BUSINESS TECHNOLOGY TRANSFER PROGRAM, INCLUDING BUT NOT LIMIT-
 ED  TO  BUSINESS  PLANNING,  COMMERCIALIZATION,  PATENTS  AND  MARKETING
 STUDIES IN SALES EFFORTS.
   (B) COMPANIES APPLYING TO THE  FEDERAL  PROGRAMS  NAMED  HEREIN  SHALL
 RECEIVE  A   COMMITMENT LETTER FROM THE CORPORATION THAT MAY BE INCLUDED
 IN THEIR APPLICATIONS TO THE SMALL BUSINESS INNOVATION RESEARCH  PROGRAM
 OR  THE  SMALL  BUSINESS  TECHNOLOGY  TRANSFER  PROGRAM OR TO BE USED TO
 SECURE GRANTS FROM OTHER FUNDING SOURCES. SUCH COMMITMENT  LETTER  SHALL
 DEMONSTRATE  CONTINGENT  STATE  SUPPORT,  AND THEREFORE INCREASING THEIR
 LIKELIHOOD OF RECEIVING FEDERAL FUNDING.  STATE  MATCHING  GRANTS  SHALL
 ONLY  BE  PROVIDED  TO  SMALL  BUSINESSES THAT ARE SELECTED FOR AN AWARD
 THROUGH THE FEDERAL SMALL BUSINESS INNOVATION RESEARCH   PROGRAM OR  THE
 SMALL BUSINESS TECHNOLOGY TRANSFER PROGRAM.
   5.  SUCH  FUNDS  SHALL BE AWARDED ON CONDITION THAT THE SMALL BUSINESS
 RECIPIENT REMAINS HEADQUARTERED AND  OPERATES  OR  MANUFACTURES  IN  THE
 STATE FOR AT LEAST FIVE YEARS FOLLOWING THE SUCCESSFUL COMMERCIALIZATION
 OF  THE  BUSINESS'S  PRODUCT  OR  PRODUCTS.  ANY SMALL BUSINESS THAT HAS
 RECEIVED FUNDING UNDER THIS PROGRAM THAT IS NOT HEADQUARTERED AND  OPER-
 ATES  OR MANUFACTURES IN THE STATE FOR AT LEAST FIVE YEARS FOLLOWING THE
 SUCCESSFUL COMMERCIALIZATION OF THE BUSINESS'S PRODUCT OR PRODUCTS SHALL
 RETURN ALL GRANT AWARDS TO THE STATE. IF THE SMALL BUSINESS CEASES OPER-
 ATIONS BEFORE FIVE YEARS AFTER THE COMMERCIALIZATION OF ITS  PRODUCT  OR
 PRODUCTS,  SUCH BUSINESS SHALL BE ELIGIBLE FOR A WAIVER OF THIS CLAWBACK
 PROVISION, AS DETERMINED BY THE CORPORATION, IN  CONSULTATION  WITH  THE
 DEPARTMENT OF ECONOMIC DEVELOPMENT'S DIVISION OF SMALL BUSINESS.
   6.  THE  CORPORATION,  IN CONSULTATION WITH THE DEPARTMENT OF ECONOMIC
 DEVELOPMENT'S DIVISION FOR SMALL BUSINESS, SHALL ESTABLISH THE FORM  AND
 MANNER  IN  WHICH  APPLICATIONS  FOR GRANT AWARDS SHALL BE SUBMITTED AND
 SHALL ESTABLISH GUIDELINES FOR THE GRANT PROGRAM. PREFERENCE  FOR  GRANT
 AWARDS  SHALL BE FOR APPLICANTS THAT CAN DEMONSTRATE TO THE SATISFACTION
 OF THE CORPORATION THAT: (A) GREEN  AND  SUSTAINABLE  DEVELOPMENT  IS  A
 PRIORITY  IN  THEIR BUSINESS PLANNING, OPERATIONS OR MANUFACTURING.  FOR
 THE PURPOSES OF THIS SECTION, "GREEN AND SUSTAINABLE DEVELOPMENT"  SHALL
 MEAN  A  BUSINESS  MODEL  THAT  PROMOTES  THE USE OF PRODUCTS OR PRODUCT
 COMPONENTS, MANUFACTURES, DEVELOPS TECHNOLOGIES OR PROCESSES   THAT  ARE
 PRIMARILY  TARGETED  AT  REDUCING GREENHOUSE GAS EMISSIONS OR SUPPORTING
 THE USE OF CLEAN ENERGY IN A SOCIALLY EQUITABLE MANNER;
 A. 4507--A                          3

   (B) SUCH GRANT AWARDEES' BUSINESS HEADQUARTERS AND OPERATIONS OR MANU-
 FACTURING SHALL BE LOCATED IN NEW YORK STATE; AND
   (C)  GRANT  AWARDEES SHALL CERTIFY   TO   THE  CORPORATION THAT FUTURE
 RESEARCH AND DEVELOPMENT SHALL BE PERFORMED PRINCIPALLY IN THIS STATE.
   THE CORPORATION SHALL REVIEW EACH APPLICATION FOR COMPLIANCE WITH  THE
 ELIGIBILITY  CRITERIA  AND  OTHER  REQUIREMENTS SET FORTH IN THE PROGRAM
 GUIDELINES ESTABLISHED BY THE COMMISSIONER. THE CORPORATION MAY  APPROVE
 OR  REJECT  EACH  APPLICATION OR MAY RETURN AN APPLICATION FOR MODIFICA-
 TIONS, IF NECESSARY.
   7. THE CORPORATION, BEGINNING ON JUNE FIRST, TWO THOUSAND TWENTY-FOUR,
 AND ANNUALLY THEREAFTER, PROVIDED PROGRAM FUNDS REMAIN, SHALL  SUBMIT  A
 REPORT  TO  THE GOVERNOR, THE TEMPORARY PRESIDENT OF THE SENATE, AND THE
 SPEAKER OF THE ASSEMBLY. SUCH ANNUAL REPORT SHALL INCLUDE, BUT NEED  NOT
 BE  LIMITED  TO: THE NUMBER OF APPLICANTS BY STAGE; THE NUMBER OF APPLI-
 CANTS APPROVED TO RECEIVE GRANTS; THE TOTAL AMOUNT OF GRANTS AWARDED AND
 THE AVERAGE AMOUNT OF SUCH GRANTS AWARDED; AND SUCH OTHER INFORMATION AS
 THE CORPORATION DETERMINES NECESSARY AND APPROPRIATE. SUCH REPORT  SHALL
 BE INCLUDED ON THE CORPORATION'S WEBSITE AND ANY OTHER PUBLICLY ACCESSI-
 BLE  STATE  DATABASES THAT LIST ECONOMIC DEVELOPMENT PROGRAMS, AS DETER-
 MINED BY THE CORPORATION.
   § 2. This act shall take effect one year after it shall have become  a
 law. Effective immediately, the addition, amendment and/or repeal of any
 rule  or  regulation necessary for the implementation of this act on its
 effective date are authorized to be made and completed on or before such
 effective date.