PA 11-2, October 2011 Special Session—SB 1401

Emergency Certification

AN ACT ESTABLISHING THE CONNECTICUT BIOSCIENCE COLLABORATION PROGRAM

SUMMARY: This act creates the Connecticut Bioscience Collaboration program within Connecticut Innovations, Inc. (CII) to support establishment of a bioscience cluster anchored by a research lab at the UConn Health Center. It requires the State Bond Commission to authorize up to $290,685,000 in general obligation (GO) bonds, with the money going to a Connecticut Bioscience Collaboration Fund, administered by CII. The money must be used to fund the program and repay the bonds in amounts the State Bond Commission may require.

The act requires the State Bond Commission to approve a memorandum of understanding (MOU) between CII's board of directors and the state regarding the bonds. Under the act, once approved, the MOU satisfies the standard statutory bond commission requirements. Other bonding provisions consistent with the act's provisions apply.

The act requires CII to collaborate with a federally tax-exempt organization to develop, construct, and equip a research lab and office. The act authorizes the CII board to provide loans for this purpose and CII, at the board's direction, to (1) provide an annual operations, research, and development grant to the organization and (2) enter into venture agreements with the organization. The act requires the board to set the application process and guidelines and terms for these grants and loans. It must review and approve each application.

The act requires the CII board to (1) report quarterly to certain legislative committees on the program's operations and funding and (2) submit the program's operating and capital budget each fiscal year to the governor, Office of Policy and Management (OPM) secretary, and certain legislative committees.

EFFECTIVE DATE: Upon passage

BONDS

Under the act, the State Bond Commission must approve a MOU between the CII board and the state regarding the bond issuance, including the extent that federal, private, or other available funds should be added to the bond proceeds. The state must act through the OPM secretary and treasurer. The MOU satisfies the standard statutory bond commission requirements.

The act sets bond amounts for each year from FY 12 to FY 21, as displayed in Table 1.

Table 1: Annual Bond Authorizations under the Act

FY

Bonding Amount

2012

$34,162,000

2013

85,113,000

2014

59,728,000

2015

19,669,000

2016

21,425,000

2017

21,108,000

2018

15,820,000

2019

12,525,000

2020

10,565,000

2021

10,570,000

Total

290,685,000

If the CII board does not provide for use of all or a portion of the authorized amount in a fiscal year, the act adds the unused amount to the following year's authorized amount. The act also allows the costs of issuance and any capitalized interest to be added to the authorized amount in each fiscal year.

LOANS, GRANTS, AND VENTURE AGREEMENTS

The act authorizes the CII board to provide loans to develop, construct, and equip a research lab and office. The board (1) must review and approve loan terms and conditions, (2) can require matching funds from private or non-state entities, (3) can allow deferred payments on loans, and (4) can forgive all or part of the loans based on its assessment of the organization's fulfillment of the loan's terms and conditions.

The act also allows CII, at the board's direction, to:

1. provide an annual operations, research, and development grant to the organization for annual operating expenses and bioscience medical research, including research on stem cells, DNA, systems genomics, and genome-based medicine and

2. enter into venture agreements with the organization on terms and conditions that benefit the state, organization, and private entities in the bioscience cluster.

FUND

The act requires CII to separately hold and administer the fund. The amounts authorized by the State Bond Commission are paid to CII for deposit in the fund. As with other bond authorizations, the act allows the treasurer to issue temporary notes in anticipation of the bond sale.

CII funds or revenues from investments or loan repayments under the program must be held, administered, and invested by CII or deposited with and invested by any institution designated by CII and paid as CII directs. All money in these accounts must be used for the program and CII can make payments from the accounts to the fund.

REPORTS

Beginning by April 15, 2012, the act requires the CII board to report quarterly to the Appropriations; Commerce; Finance, Revenue and Bonding; and Higher Education and Employment Advancement committees on the status and progress of the program's operations and funding.

The act requires the CII executive director to (1) prepare an operating and capital budget for the program each fiscal year and (2) submit it to the CII board 90 days before the fiscal year starts. It requires the board to submit a copy of the budget to the governor; OPM secretary; and the Appropriations; Commerce; Finance, Revenue and Bonding; and Higher Education and Employment Advancement committees.

OLR Tracking: CR: JH: PF: ro