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S.129

Introduced by   Senator Miller of Chittenden District and Senator Dunne of Windsor District

Referred to Committee on

Date:

Subject:  Commerce and trade; creative economy; Vermont seed capital fund

Statement of purpose:  This bill proposes to make technical and efficiency changes to the Vermont seed capital fund.

AN ACT RELATING TO VERMONT SEED CAPITAL FUND

It is hereby enacted by the General Assembly of the State of Vermont:

Sec. 1.  10 V.S.A. § 291 is amended to read:

§ 291.  VERMONT SEED CAPITAL FUND; AUTHORIZATION;

            LIMITATIONS

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(b)  The Vermont seed capital fund shall be formed as either a business corporation or a limited partnership pursuant to Title 11 and shall be subject to all the following:

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(2)  Before the fund makes any investments, the fund shall:

(A)  If organized as a corporation, have and thereafter maintain a board of nine directors, seven of whom shall to be elected by the shareholders and two of whom shall be appointed by the governor with the advice and consent of the senate and shall represent the public interest of the state.

(B)  If organized as a partnership, have and maintain a board of three advisors appointed by the governor with the advice and consent of the senate Vermont economic development authority.  The board of advisors shall represent solely the public economic interest of the state with respect to the management of the fund and shall have no civil liability for the financial performance of the fund.  The board of advisors shall be advised of investments made by the fund and shall have access to all information held by the fund with respect to investments made by the fund.

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(5)  No person shall be allocated more than 10 percent of the available tax credits.  For the purposes of determining allocation, the attribution rules of Section 318 of the Internal Revenue Code in effect as of the effective date of this chapter shall apply.

(6)  The first $2 $5 million of capitalization of the Vermont seed capital fund raised from Vermont taxpayers on or before January 1, 2014, shall be eligible for partial tax credits as specified in 32 V.S.A. § 5830b.

(7)  All investments and related business dealings using funds that qualify for partial tax credits under 32 V.S.A. § 5830b shall be subject to the following restrictions:

(A)  The investments shall be restricted to Vermont firms, which for the purposes of this chapter means that their Vermont apportionment under 32 V.S.A. § 5833 equals or exceeds 50 percent, using the apportionment rules under 32 V.S.A. § 5833, and they maintain headquarters and a principal facility in VermontAny funds invested in Vermont firms shall be used for the purpose of enhancing their Vermont investments.  Investment shall be restricted to firms that export the majority of their products and services outside the state or add substantial value to products and materials within the state.  In its investments, the fund shall give priority to new firms and existing firms that are developing new products.

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Sec. 2.  10 V.S.A. § 293 is amended to read:

§ 293.  CAPITALIZATION

The fund may solicit and receive subscriptions provided that tax credits associated with subscriptions for amounts exceeding $2 million shall be reduced pro rata among subscribers subscribing for more than $2 million in the event the issue is oversubscribed by the termination date as set by the fund.  The minimum capitalization shall be $1 million.



Published by:

The Vermont General Assembly
115 State Street
Montpelier, Vermont


www.leg.state.vt.us