ANNAPOLIS – A House of Delegates committee approved Senate changes to a proposed state-run venture capital fund Monday evening, leaving the governor’s top economic legislation with one final hurdle before the midnight deadline.
Gov. Martin O’Malley told reporters earlier Monday afternoon that the venture fund, known as Invest Maryland, “would be a real shot in the arm” for the state’s economy. The program would invest at least $70 million in early stage, high-tech companies.
The bill passed by the Senate is a trimmed-down version of what O’Malley first proposed last summer and made his top economic initiative when the legislature convened in January.
The state would auction $100 million in tax credits for as little as 70 cents on the dollar to raise at least $70 million to fuel a venture capital fund. The governor had sought $142 million in credits to raise about $100 million for the fund.
The funds would be used to make investments in small, high-tech Maryland companies. One-third of the money would be controlled by the Department of Business and Economic Development, which would focus its investments on entrepreneurial and early-stage companies. Two-thirds would be invested on the state’s behalf by private venture capitalists, with a focus on larger, growth-stage firms.
Senators added a provision that would allow the governor to pay for some or all of the program with cash if the state’s fiscal situation improves by the fall. They also added language designed to boost investment in companies in rural counties.
The House Ways and Means Committee agreed to those changes with a voice vote, sending the bill onto the House floor for final approval as the legislature worked through a long agenda on the final day of its 90-day session.
DBED Secretary Christian Johansson said Saturday after seeing the Senate’s proposal that he is “cautiously optimistic” about the bill’s prospects.
“The capital really plays to our strengths,” he said. “I think it will have a significant impact on the state’s economy.”