In her annual State of the State address yesterday, Gov. Janet Napolitano highlighted Arizona’s continued efforts to move toward a high-wage knowledge economy and touched on broad plans for paying for the new Phoenix extension of the University of Arizona medical school.
Citing a desire to grow the state’s high-tech industry and need for profitable university research, the governor proposed expanding a research and development tax credit for business partners of the three public universities. She also mentioned that plans for the new medical school, a cooperative effort between the University of Arizona and Arizona State University to be housed on a campus in Phoenix, are moving quickly. She encouraged funding for the initial class of 24 students, slated for 2006, and the establishment of a “Medical Center Savings Account,” which would provide “the financial wherewithal for a truly world-class medical center that includes education, research, and clinical facilities.”
In keeping with these themes of high-tech economic development, the Legislature is likely to consider new versions of failed legislation from last year that sought to bolster entrepreneurial investment by angels and venture capitalists.
Sen. Barbara Leff, who serves on the Governor’s Council on Innovation and Technology, plans to sponsor a bill to create the Arizona Small Business Opportunity Program, which would provide a 30 to 35 percent tax credit over three years “to individuals willing to invest somewhere between $25,000 and $250,000 in a high-technology, biotechnology/bioscience firm,” according to the Arizona Capitol Times. The bill would cap the angel tax credit at $20 million over five years.
“If we do nothing, then we’re handing over the profits of research to other states, because those entrepreneurs will take what we’ve found through the research and development at our universities and start up those companies in other states,” Leff told the paper.
Another failed 2004 bill likely back on the docket will seek to build a $50 million fund to match venture capital investments in Arizona. The fund, to which the state is prohibited to make contributions directly, would take the form of matching tax credits to potential VC investors.
For more information:
“Tech leaders to push for startup tax credits,” Arizona Daily Star, 1/14/2005
“Invest in what matters; Governor’s address urges unity for state agenda,” Arizona Republic, 01/11/2005
“Education’s the focus as governor opens 47th Legislature,” Tucson Citizen, 01/11/2005