Thank you for your support of technology-based economic development in Maryland. During these difficult economic times, it is more important than ever to build our tech and biotech industries and the Tech Council of Maryland (TCM) appreciates your support.
Increase funding for the Maryland Biotech Tax Credit for FY2013. Increase funding in FY2013 for the Maryland Biotech Tax Credit to $12 million and eventually increase the funding for this program to $24 million as recommended in Governor Martin O'Malley's Bio2020 Initiative. This tax credit is a critical component for seeding early-stage biotech companies to develop and thrive in Maryland. Maryland needs to continue to create and retain biotech industry jobs, which average more than $90,000 a year.
Increase the Maryland Research and Development Tax Credit's cap to $12 million. The R&D Tax Credit is a highly effective incentive that is oversubscribed at the current $6 million cap. Companies can do their research and development virtually anywhere in the country, so incentives count. Maryland is a leader in R&D, ranking first in federal R&D obligations per capita and second in federal R&D investment at $12.2 billion. Our state is also home to several of the nation’s top research universities including Johns Hopkins, the University of Maryland, College Park, the University of Maryland, Baltimore and the University of Maryland, Baltimore County, which combined conduct over $2 billion in funded research annually.
Support the Invest Maryland Program. The Invest Maryland program, established during the 2011 session, is an important investment vehicle that expands available capital to start-up and early-stage innovative companies in Maryland. A key factor to the success of the five-year, $75 million program is support from policymakers. Legislators need to carefully monitor the program and be ready to address any issues as they arise. It is important for Maryland's economy and job creation efforts that the Invest Maryland program achieves success.
Encourage pension fund investment in biotechnology, information technology, medical technology and green technology. Encouraging the Maryland State Retirement and Pension System to invest a greater portion of its money to seed a new or existing venture fund that invests locally in biotech, tech, medical tech and green tech companies would spur job creation. Venture programs are a critical component for tech-led economic development. Utilizing pension funds could allow for much needed capital without the increasing the budget.
Increase funding for the Maryland Venture Fund. It is important that policymakers maintain or increase funding for the Maryland Venture Fund and its two investment vehicles, the Challenge Fund and Enterprise Fund. While the Invest Maryland program will increase funding over the next five years, the Venture Fund remains one of the most important incentives for innovative companies to start, grow and create jobs here in Maryland. The Maryland Venture Fund makes direct equity investments in emerging technology and life sciences companies. According to the Department of Business and Economic Development, which administers the program, approximately 60% of the Fund is invested in software, communications and IT security, and 40% is invested in therapeutics, medical devices and diagnostics.
Establish Net Operating Loss (NOL) incentive for Maryland's most innovative companies. Legislative leaders should establish a tax transfer program whereby innovative Maryland companies could benefit by selling unused net operating losses to profitable Maryland corporations. Profitable corporations could also benefit by purchasing these tax benefits and thereby reduce their own tax liabilities. An NOL occurs when a company’s business costs and expenses are greater than its taxable income in a given year. Having such an incentive would boost competitiveness and long-term viability of some start-up and early-stage companies, which often incur heavy losses over multiple years before becoming profitable.
Establish an incentive to further develop Maryland’s information technology industry. Legislative leaders should establish an incentive for Maryland’s information technology companies. Possible incentives include a tax credit for off-setting preparation costs incurred while accessing the General Services Administration (GSA) schedule. For some Maryland companies, these costs are prohibitive. Great opportunity exists with the GSA as they establish long-term contracts with companies that provide access to over 11 million commercial products and services at volume discount pricing.
Maintain stem cell research funding for FY2013. Policymakers should continue to fund stem cell research for FY2013, which helps meet the needs of current stem cell funding beneficiaries while continuing important research and job creation. The State of Maryland is one of the biggest supporters of advanced stem cell research in the nation. Decision makers also need to ensure that private sector businesses are participating in this fund so Maryland realizes tangible job creation benefits.
Increase efforts to foster commercialization by boosting university tech transfer office funding. It is imperative that policymakers support efforts to identify research which has commercial interest and strategies to bring those technologies to market. Stronger partnerships in tech transfer and commercialization will create more innovative companies and jobs in Maryland. Policymakers should increase support for valuable programs that help accelerate the commercialization of technologies like the Maryland Industrial Partnerships (MIPS) program and the Maryland Technology Development Corporation (TEDCO).
Support legislative, budgetary and regulatory actions advancing incentives for continued biomedical innovation benefiting patients. Policymakers should oppose efforts including permissibility of drug importation, advancement of price controls, excessive regulation of clinical trials, barriers to biomedical research, limitations on responsible marketing practices, mandates regarding manufacturer responsibility for the disposal of medications and restrictions on the physician-patient relationship limiting access to innovative medicines.
Support telecommunications innovation. Maryland is a leader in telecommunications innovation and the industry creates a tremendous amount of high-paying jobs. Policymakers should support the industry and its efforts, including the continuation of broadband development by fostering the deployment of high-speed data service to rural and underserved areas and encouraging the adoption of information technology services by business and residences throughout Maryland.
Make Maryland a leader in the development of nanobiotechnology and nanotechnology. Maryland should support funding for the growing field of nanobiotechnology and nanotechnology research. This should include funding for the Coordinating Emerging Nanobiotechnology Research (CENTR) in Maryland Program. New technologies like nanobiotech and nanotech hold great economic development potential for the State of Maryland.
Establish Maryland as a leader in healthcare information technology. Policymakers should focus on opportunities presented by healthcare reform to position Maryland as a leader national leader in healthcare information technology. This includes supporting Maryland’s efforts to develop a statewide health information exchange and create universal compliance standards for all health care providers in Maryland.
Establish Maryland as a national leader for healthcare information technology. Policymakers should focus on opportunities presented by healthcare reform to position Maryland as a national leader national leader in healthcare IT. This includes supporting Maryland's efforts to develop a statewide health information exchange and create universal compliance standards for all health care providers in Maryland.
Establish Maryland as a national leader for clean and green technologies. Support incentives for companies developing clean technologies so Maryland can develop into the preeminent location for clean technology commercialization and business investment. Policymakers should create a new, targeted tax credit program that incentivizes the development and commercialization of clean technologies including wind, biodiesel, geothermal, fuel cells, nanotechnologies and solar energy.
Oppose new taxes on innovation. Any new taxes on Maryland’s most innovative companies harm efforts to attract and retain technology businesses and high-paying jobs. In particular, TCM strongly opposes new taxes on business services that may harm Maryland’s most innovative job creators. Even the discussion of new tax proposals, like another Computer Services Sales Tax, is extremely harmful to an important and growing industry where the average job pays more than $80,000. Policymakers also need to create a predictable regulatory environment to help spur job creation.
Create certainty in the business community by opposing new business taxes or changes to the corporate tax structure. It is imperative that policymakers create a climate of consistency and certainty for Maryland’s business community. The mere discussion of taxes such as the millionaire’s tax (which negatively impacts some small businesses) or combined reporting are harmful to job creation efforts. Policymakers must keep in mind the importance of a fair, consistent and competitive tax climate that balances job creation with budgetary responsibility. Policymakers must oppose corporate tax changes like the institution of combined reporting and any measure that alters the tax structure for manufacturers. These tax changes make Maryland less competitive and particularly disadvantages biotechnology companies.
Develop and implement long-term, stable funding solutions for Maryland's transportation infrastructure. Maryland faces enormous transportation infrastructure challenges and solving this is paramount to Maryland’s economic development efforts. Innovative companies need a reliable and effective transportation infrastructure in order to create and maintain high-quality economic growth. Funding Maryland’s Transportation Trust Fund largely through the gas tax is not a sustainable revenue model.
Ensure a higher education is affordable for students and that loans and student aid are available for Maryland's families. Policymakers must ensure more stable and predictable funding streams for Maryland’s universities and colleges, including capital funding. The Maryland higher education system is vital to providing a strong pipeline of technology and biotechnology workers for Maryland companies. Support Maryland’s network of community colleges, which play a large role in Maryland’s tech-led economic development engine by training and retraining Maryland’s tech workers.
Recognize the importance of Maryland's most innovative education assets. Policymakers should continue to support assets important to workforce creation. These include the University of Maryland BioPark, University of Maryland College Park M Square Research Park, Johns Hopkins Science and Technology Park, Montgomery College Bioscience Education Center, Montgomery College Science and Technology Park in Germantown, Maryland’s technology incubator network and other similar efforts throughout Maryland. Assets like these play a pivotal role in strengthening Maryland’s innovation economy.
Address workforce shortages in high-tech fields. Policymakers should support the recommendations of the Governor’s Science, Technology, Engineering and Math (STEM) Task Force to establish Maryland as a global leader in the development of its workforce and its STEM-based research and economic development infrastructure. STEM Task Force recommendations included tripling the number of teachers in STEM shortage areas and increasing the number of STEM college graduates by 40 percent by 2015. In particular, policymakers should reinvest in job training with an emphasis on upgrading the skills base of high-tech workers and creating incentives that encourage workers to move and live in Maryland.
