SS#2/SCS/HB 1495 - This act creates a program for grants to early stage business. Beginning fiscal year 2015 and subject to appropriation, the state shall pay $9 million per fiscal year to Early Stage Business Development Corporations (ESBDCs). ESBDCs will provide grants to business that are selected from an application process, have substantial operations in Missouri or that will begin operating in Missouri, and have potential for regional, national, or international sales or potential to develop new technologies. The funding will be split so that the three largest metropolitan statistical areas (MSAs) and Columbia will each be eligible to receive up to $2 million. Two ESBDCs operating in more rural parts of the state will each be eligible for $500,000.
ESBDCs must be not-for-profits designated by the Missouri Technology Corporation to receive funds. A not-for-profit in the three largest MSAs or Columbia must have raised at least $500,000 from private sources before being designated an ESBDC. Such ESBDCs that raise at least $500,000 will be eligible for an appropriation equal to the amount of donations received, up to $2 million. Not-for-profits in other parts of the state must have raised at least $150,000 from sources other than the state before being designated an ESBDC.
To continue to be designated an ESBDC in one of the three largest MSA or Columbia, a not-for-profit must raise the required initial amount every four years. ESBDCs in other parts of the state must raise half the required initial amount every four years. ESBDCs may include amount received by partners of a coalition if such funds are designated to be used for grants for earl stage businesses. Designation as an ESBDC shall be for two years. An ESBDC may reapply for an additional two years. The MTC may rescind a designation after the first year if it determines an ESBDC is misusing funds. The MTC may provisionally designate an ESBDC. However, provisionally designated ESBDCs will be ineligible for funding until full designation.
If an ESBDC is not designated in one of the three largest MSAs or Columbia or two are not designated in other parts of the state, the amount that would have been disbursed to such region will be disbursed equally to the other regions with designated ESBDCs. If less than $9 million dollars is appropriated in a fiscal year, 2/9 of the appropriated amount will be disbursed to each of the three largest MSAs and Columbia and 1/18 will be disbursed to each ESBDC in other parts of the state.
Grants to businesses by ESBDCs in the three largest MSAs or Columbia will not require repayment. Grants by ESBDCs in other parts of the state may be loans. ESBDCs cannot take an equity interest in business that receive grants.
No more than 10% of funding received by an ESBDC may be used for administrative costs. Funds received by an ESBDC may not be used to build an endowment. Companies that receive funds from an ESBDC and move their business out of state within a year of receiving funds must pay back the funds.
No funding shall be authorized under this act after fiscal year 2018 unless the act is reauthorized. No funding shall be authorized for projects involving abortion service. The provisions of the act are subject to the Missouri Stem Cell Research and Cures Initiative.
This act is similar to SB 994 (2014) and HB 813 (2013). This act is similar to a provision in HCS/SB 777 (2014).
MIKE HAMMANN