We urge you to support the following objectives and priorities during the 2015 session:
Competitiveness and Economic Growth:
- Enhance Virginia's ability to attract companies that are seeking to expand, relocate, move corporate headquarters, or establish research operations.
- Support a comprehensive "Grow Your Own" strategy for new company formation to position Virginia as a leader in next generation technology company formation and innovation, as well as a top destination for entrepreneurs, early-stage investors, researchers and innovators.
- Ensure Virginia maintains its status as a top state for business by minimizing taxes and regulation, preserving right to work and avoiding negative signals that drive private enterprise away from the Commonwealth.
- Invest in targeted innovation funding initiatives to boost Virginia’s competitiveness in promoting research, entrepreneurship, innovation, emerging technologies and technology-based economic growth, and job creation. There are only a handful of line items in Virginia’s budget that directly impact innovation, research, commercialization, new company formation and entrepreneurship. The Commonwealth has made significant progress in recent years in achieving new and sustained technology innovation funding to achieve these objectives through targeted state investment. These targeted programs recognize that technology, life sciences and energy businesses, generally, can grow and scale quickly and pay an average wage almost twice that of other businesses.
STEM Education and Workforce:
- Restore funding cuts to CIT GAP Funds which has a proven track record of growing innovative technology companies across the Commonwealth. Over the past 10 years, more than 3,000 entrepreneurs have applied for seed investment through the CIT GAP Funds. To date, the CIT GAP Funds program has invested in 128 businesses using $16.1 million in public funds that have leveraged $257.3 million (as of 9/30/14) in private funding or a 16X match. As a result of Virginia’s budget shortfall, the CIT GAP Funds were cut by 26 percent this biennium from the previous biennium. These cuts are a significant setback that will undermine Virginia’s current efforts to diversify our technology economy and grow innovative new technology businesses across the Commonwealth.
- Extend Virginia’s capital gains exemption for investments in technology, life sciences and energy businesses. This exemption, which currently expires in June 2015, is an incentive that stimulates high-potential startup company formation by providing a state capital gains tax exclusion for founders of and investors in qualified Virginia start-ups. Through this initiative, Virginia gains competitive advantage relative to other states where entrepreneurs could choose to locate. It also provides existing entrepreneurs with a more willing investment community. More than 40 technology startups have qualified under this incentive to date and there is no cost to the Commonwealth unless those startups become successful Virginia businesses.
- Maintain current funding levels for Virginia’s cybersecurity, modeling & simulation and other initiatives that leverage Virginia's federal, state and private sector assets to continue to position and promote Virginia as the go-to location for cybersecurity, Big Data, cloud-focused businesses, unmanned aerial vehicles (UAVs), and other sectors where Virginia has a competitive advantage.
- Maintain funding for Virginia's Commonwealth Research Commercialization Fund (CRCF) which accelerates entrance of new products and services to the market, incentivize collaboration between institutions of higher education and companies engaged in research in high-growth, emerging industries and provide new resources to attract and retain eminent researchers at Virginia universities.
- Provide Virginia’s Mach37 Cyber Accelerator with statutory and budget authority to accept private sector funding and investment to support its operations.
MACH37 is the premier accelerator for information security entrepreneurs and startups. Mach37 goes beyond the traditional model of typical business accelerators by bringing innovators focused mentorship and support from their extensive network of cyber security visionaries, practitioners, and successful entrepreneurs. It propels graduating companies into the marketplace, equipped with the skills to grow and compete for funding and market share. MACH37 was launched in 2013 with a state funding commitment for two years after which time Mach37 planned to seek private sector funding to continue its operations. However, statutory and budgetary language is required to allow for private sector funding.
- Maintain current funding levels for Virginia’s other critical innovation and entrepreneurship initiatives including the Angel Investment Tax Credit and the R&D Tax Credit.
Virginia is one of many states that offer an angel investment tax credit and an R&D tax credit to attract and encourage innovation, research, commercialization and new company formation. Growth in applications for both of these credits is a positive indicator that these incentives are succeeding in growing and diversifying Virginia’s technology economy by encouraging additional research activity in Virginia and by encouraging entrepreneurs to launch their technology startups here. We believe it is critical that these tax credits are fully funded to ensure current and future investors in these activities receive the full value of the incentive they are expecting.
- Boost Virginia's technology workforce through a robust science, technology, engineering and mathematics (STEM) education pipeline, by increasing the number of STEM certifications and degrees awarded statewide, and by advancing policies that ensure Virginia businesses and universities can hire the best and brightest and all Virginians can participate in the growing technology economy.
- Grow Virginia's STEM workforce by increasing STEM focus in K-12, providing incentives and additional compensation to help attract and retain quality STEM teachers, and implementing additional STEM programs for Virginia students.
- Promote state legislation to extend basic job protections by prohibiting employers from discriminating based on sexual orientation. Such legislation, in addition to fostering fair treatment in the workplace, would benefit technology employers by promoting employment and retention of a critical talent pool and also would benefit higher education institutions in their recruitment and retention of faculty and researchers who train the workforce and help drive our innovation economy.
- Continue support for Virginia Values Veterans and other targeted workforce initiatives to provide training and job opportunities for veterans returning to Virginia after active duty.
- Launch a new veterans employment performance grant incentive to encourage small and mid-size businesses to hire veterans.
- Scale the Northern Virginia Community College’s Military Occupational Specialty (MOS) to Degree program into a statewide initiative in support of service members seeking employment in the technology sector by ensuring Virginia’s community colleges award academic credit for military training applicable to a student’s certificate or degree requirements.
- Improve infrastructure, including transportation, energy and broadband, to support economic development and help Virginia companies compete.