THE SENATE

S.B. NO.

815

THIRTY-SECOND LEGISLATURE, 2023

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

RELATING TO THE HAWAII TECHNOLOGY DEVELOPMENT CORPORATION.

 

 

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

 


SECTION 1. Chapter 206M, Hawaii Revised Statutes, is amended by adding a new section to part V to be appropriately designated and to read as follows:

"206M- Accelerator program; established. (a) There is established the accelerator program, through which the development corporation may provide grants to Hawaii-based start-up companies pursuant to this section.

(b) Subject to available funds, the accelerator program shall:

(1) Apply funds to support product development, technology transfer, and commercialization;

(2) Provide capital to support accelerated commercialization activities for Hawaii-based start-up companies;

(3) Provide capital to sustain high-potential infrastructure development to assist Hawaii-based start-up companies reach commercial success;

(4) Promote efforts that:

(A) Reverse the loss of qualified workers to other states by creating jobs to retain existing Hawaii technology employees; and

(B) Enable highly qualified scientists and engineers to return to living wage jobs in Hawaii; and

(5) Promote efforts that keep technology companies in Hawaii by limiting the need to seek out-of-state venture capital, which dilutes local ownership and increases the probability that a high-potential technology company will move away from Hawaii;

provided that no company shall receive a grant exceeding $100,000 in any given year.

(c) All moneys necessary to carry out the purposes of this section shall be appropriated out of the general fund by the legislature.

(d) In reviewing grant applications pursuant to this section, the development corporation shall analyze each application to determine whether the item to be undertaken will be economically viable and beneficial to the State.

(e) The development corporation shall submit a report to the legislature no later than twenty days prior to the convening of each regular session that includes:

(1) The total number of grants provided;

(2) The sectors provided with grants;

(3) The total projected economic and employment growth facilitated by those grants; and

(4) The actual economic and employment growth that occurred because of those grants.

The development corporation shall post the report on the development corporation's website.

(f) The development corporation may adopt rules pursuant to chapter 91 necessary to carry out the purposes of this section.

(g) For purposes of this section:

"Hawaii-based start-up company" means a company:

(1) Headquartered in the State;

(2) Doing business in the State for not more than five years; and

(3) Employing fifteen or more residents with income subject to taxation pursuant to chapter 235.

"Resident" shall have the same meaning as in section 235‑1."

SECTION 2. Section 206M-15.1, Hawaii Revised Statutes, is amended by amending subsection (d) to read as follows:

"(d) The development corporation shall submit a report to the legislature no later than twenty days prior to the convening of [the] each regular session [held in every even-numbered year. The report shall include the following items:] that includes:

(1) The total number of grants provided;

(2) The sectors provided with grants;

(3) The amount of each grant awarded;

(4) A description of any equipment purchased with each grant and the cost of that equipment;

(5) An assessment from the grantee describing how effective the equipment purchased was in assisting the grantee improve the grantee's manufacturing process or energy efficiency, as appropriate;

[(3)] (6) The total projected economic and employment growth facilitated by the grants provided; and

[(4)] (7) The actual economic and employment growth that occurred as a result of the grants provided.

The development corporation shall post the report on the development corporation's website."

SECTION 3. Section 206M-15.2, Hawaii Revised Statutes, is amended to read as follows:

"206M-15.2 Research and development program established. (a) There is established within the development corporation, the research and development program, to help Hawaii-based small businesses optimize research and development performed in Hawaii.

(b) Subject to available funds, the research and development program shall:

(1) Apply funds to support product development, technology transfer, and commercialization;

(2) Provide capital to support accelerated commercialization activities for qualified Hawaii‑based small businesses;

(3) Provide capital to sustain high-potential infrastructure development to assist qualified Hawaii‑based small businesses towards commercial success;

(4) Promote efforts that [reverse]:

(A) Reverse the loss of qualified workers to other states by providing jobs to retain existing Hawaii technology employees; and [enable]

(B) Enable highly qualified scientists and engineers to return to living-wage jobs in Hawaii;

(5) Promote efforts that keep technology companies in Hawaii by limiting the need to seek out-of-state venture capital, which dilutes local ownership and increases the probability [of] that a high-potential technology [companies moving] company will move away from Hawaii; and

(6) Provide grants of up to $300,000 for critical product development that enables a qualified Hawaii-based small business to achieve significant product development and technical milestones.

(c) To receive funding, a Hawaii-based small business shall submit to the development corporation proof of the federal research and development tax credits received. Proof shall be in the form of copies of the small business Internal Revenue Service Form 6765 Credit for Increasing Research Activities as filed. The business shall be eligible to receive a grant in an amount equal to the average of the federal tax credit for the prior three tax years.

(d) In reviewing grant applications pursuant to this section, the development corporation shall analyze each application to determine whether the item to be undertaken will be economically viable and beneficial to the State.

(e) The development corporation may adopt rules pursuant to chapter 91 necessary to carry out the purposes of this section.

(f) The development corporation shall submit a report to the legislature no later than twenty days prior to the convening of each regular session that includes:

(1) The total number of grants provided;

(2) The sectors provided with grants;

(3) The total projected economic and employment growth facilitated by those grants; and

(4) The actual economic and employment growth that occurred because of those grants.

The development corporation shall post the report on the development corporation's website.

[(f)] (g) For purposes of this section:

"Hawaii-based small business" means a company:

(1) Headquartered in the State;

(2) Doing business in the State for not less than five years; and

(3) Employing fifteen or more residents with income subject to taxation pursuant to chapter 235.

"Resident" shall have the same meaning as in section 235‑1."

SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 5. This Act shall take effect upon its approval.

 

INTRODUCED BY:

_____________________________

 

 


 


 

Report Title:

HTDC; Accelerator Program; Manufacturing and Development Program; Research and Development Program; Reports

 

Description:

Establishes an accelerator program within the Hawaii Technology Development Corporation. Amends the reporting requirements for Hawaii Technology Development Corporation's manufacturing and development program. Requires the Hawaii Technology Development Corporation to submit annual reports to the Legislature regarding the outcomes of the research and development program.

 

 

 

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