HB3064

Report Title:

Hawaii Innovations Fund; State Private Investment Fund

Description:

Establishes the Hawaii Innovations Fund (HIF) to provide grants to individuals or businesses that conduct research or product development in the life sciences, qualified high technology, and advanced technology fields. Appropriates $100,000,000 to be deposited into the HIF, with $50,000,000 transferred from HIF to the State Private Investment Fund.

HOUSE OF REPRESENTATIVES	H.B. NO.	3064
TWENTY-THIRD LEGISLATURE, 2006
STATE OF HAWAII

A BILL FOR AN ACT

relating to economic Development.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. This Act shall be known as the Hawaii Innovations Fund Act.

SECTION 2. Chapter 304, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

"§304- The Hawaii innovations fund. (a) There is established in the state treasury a fund to be known as the Hawaii innovations fund that shall be administratively attached to the university.

(b) The objective of the Hawaii innovations fund shall be to:

(1) Stimulate economic development in the advanced technology, life sciences, and qualified high technology fields using the resources of the University of Hawaii, including the John A. Burns School of Medicine in Kakaako;

(2) Create high-quality, high-income job opportunities in the life sciences, qualified high technology, and advanced technology fields, including jobs for graduates of post-college programs; and

(3) Provide incentives for residents to stay and work in Hawaii and encourage former residents to return to Hawaii.

To accomplish these objectives, which are deemed to be public purposes, fifty per cent of the moneys in the Hawaii innovations fund shall be used to fund grants to individuals or businesses that conduct research or product development in the life sciences, qualified high technology, or advanced technology fields and fifty per cent of the moneys in the Hawaii innovations fund shall be used for the state private investment fund.

(c) From July 1, 2006, through June 30, 2007, the Hawaii innovations fund shall be funded by appropriations from the legislature. After June 30, 2007, one-half of one per cent of general fund revenues collected shall be deposited into the Hawaii innovations fund on a monthly basis; provided that after June 30, 2011, no general fund revenues shall be provided to the Hawaii innovations fund.

(d) The Hawaii innovations fund shall be administered by the Hawaii innovations fund community board consisting of eleven voting members as follows:

(1) Four ex officio members as follows:

(A) The director of business, economic development, and tourism, or the director's designee;

(B) The dean of the University of Hawaii school of medicine, or the dean's designee;

(D) The executive director of Enterprise Honolulu;

(2) Three members appointed by the governor;

(3) Two members appointed by the governor from a list of nominees submitted by the speaker of the house of representatives; and

(4) Two members appointed by the governor from a list of nominees submitted by the president of the senate.

Each member appointed shall possess national reputations as experts in the field of life sciences or advanced technology.

The chairperson of the Hawaii innovations fund community board shall be elected by majority vote of all members. The chairperson shall preside over meetings. Decisions shall be made based on majority vote of quorum. Quorum shall be six members. Members shall serve without compensation, but shall be reimbursed for expenses, including travel expenses, necessary for the performance of their duties.

(e) The Hawaii innovations fund community board shall:

(1) Establish procedures and policies for grant applications;

(2) Develop standards and criteria to determine grant awardees, with priority assigned to grant applicants that:

(A) Provide matching funding;

(B) Reside or are based in Hawaii;

(D) Provide significant return on investment from grant awards; or

(E) Use grant awards as seed money to obtain additional research funding for projects in the life sciences, qualified high technology, or advanced technology fields based in Hawaii;

(3) Select grant awardees;

(4) Set criteria and standards for evaluation of projects receiving grants; and

(5) Provide technical support services to grant awardees that foster marketing and development of the product or service produced through the grant.

(f) For the purposes of this section:

"Advanced technology" means digital media, telecommunications, and related fields.

"Life sciences" means biology, cancer research, community healthcare, ocean sciences, agriculture, pharmacology, biotechnology, medical technology, biological renewable energy, or related fields.

"Qualified high technology" means development and design of computer software, sensor and optic technologies, ocean sciences, or nonfossil fuel energy-related technology."

SECTION 3. There is appropriated out of the general revenues of the State of Hawaii the sum of $100,000,000 or so much thereof as may be necessary for fiscal year 2006-2007 to be deposited into the Hawaii innovations fund.

The sum appropriated shall be expended by the department of budget and finance for the purposes of this Act.

SECTION 4. There is appropriated out of the Hawaii innovations fund the sum of $50,000,000 or so much thereof as may be necessary for fiscal year 2006-2007 to be used to fund grants to individuals or businesses that conduct research or product development in the life sciences, qualified high technology, or advanced technology field that meet the objectives in subsection (b) of section 304- , Hawaii Revised Statutes.

The sum appropriated shall be expended by the University of Hawaii for the purposes of this Act.

SECTION 5. There is appropriated out of the Hawaii innovations fund the sum of $50,000,000 or so much thereof as may be necessary for fiscal year 2006-2007 to be transferred to the capital formation revolving fund established by section 211G-16, Hawaii Revised Statutes.

The sum appropriated shall be expended by the University of Hawaii for the purposes of this Act.

SECTION 6. There is appropriated out of the capital formation revolving fund the sum of $50,000,000 or so much thereof as may be necessary for fiscal year 2006-2007 to be used for the purposes of the State private investment fund under chapter 211G, Hawaii Revised Statutes.

The sum appropriated shall be expended by the Hawaii strategic development corporation for the purposes of this Act.

SECTION 7. There is appropriated out of the general fund revenues of the State of Hawaii the sum of $50,000 or so much thereof as may be necessary for fiscal year 2006-2007 as a grant-in-aid to the Hawaii Sciences and Technology Council to provide administrative support for the Hawaii innovations fund.

The sum appropriated shall be expended by the University of Hawaii for the purposes of this Act.

SECTION 8. New statutory material is underscored.

SECTION 9. This Act shall take effect upon its approval; provided that:

(1) Sections 3, 4, 5, 6, and 7 shall take effect on July 1, 2006; and

(2) This Act shall be repealed on June 30, 2012, and all unencumbered and unexpended balances remaining in the Hawaii innovations fund shall be transferred to the credit of the general fund.

INTRODUCED BY:	_____________________________