House File 477 - Introduced HOUSE FILE 477 BY COMMITTEE ON ECONOMIC GROWTH (SUCCESSOR TO HSB 86) A BILL FOR An Act relating to bioscience-based economic development, the 1 establishment of a bioscience development corporation, and 2 membership on the Iowa innovation council. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 TLSB 1280HV (1) 88 ko/tm

H.F. 477 Section 1. Section 8.11, subsection 2, paragraph a, Code 1 2019, is amended to read as follows: 2 a. “Disability” means the same as provided defined in 3 section 15.102 , subsection 10, paragraph “b” , subparagraph (1) . 4 Sec. 2. Section 12.34, subsection 1, Code 2019, is amended 5 to read as follows: 6 1. The treasurer of state may invest up to the lesser of 7 one hundred eight million dollars or twenty-five percent of 8 the balance of the state pooled money fund in certificates 9 of deposit in eligible lending institutions as provided 10 in section 12.32 , this section , and sections 12.35 through 11 12.43 . One-half of the moneys invested pursuant to this 12 section shall be made available under the program implemented 13 pursuant to section 12.43 to increase the availability of lower 14 cost moneys for purposes of injecting needed capital into 15 small businesses which are fifty-one percent or more owned, 16 operated, and actively managed by one or more women, minority 17 persons, or persons with disabilities. “Disability” means and 18 “minority person” mean the same as defined in section 15.102 , 19 subsection 10 . A “minority person” means the same as defined 20 in section 15.102, subsection 10. The treasurer shall invest 21 the remaining one-half of the moneys invested pursuant to this 22 section to support any other eligible applicant as provided in 23 section 12.43 . 24 Sec. 3. Section 15.102, Code 2019, is amended by adding the 25 following new subsections: 26 NEW SUBSECTION . 1A. “Bioscience-based economic development” 27 means economic development related to industries involved in 28 any of the bioscience development platforms. 29 NEW SUBSECTION . 1B. “Bioscience development platforms” 30 means industries involved in any of the following: 31 a. Vaccines and immunotherapeutics. 32 b. Biobased chemicals. 33 c. Precision and digital agriculture. 34 d. Medical devices and medical diagnostics. 35 -1- LSB 1280HV (1) 88 ko/tm 1/ 7

H.F. 477 Sec. 4. Section 15.102, subsection 5, Code 2019, is amended 1 to read as follows: 2 5. “Corporation” means the Iowa innovation a bioscience 3 development corporation created pursuant to section 15.107 . 4 Sec. 5. Section 15.106B, subsection 2, paragraph b, Code 5 2019, is amended to read as follows: 6 b. Establish a nonprofit corporation pursuant to 7 section 15.107 , for the purpose of receiving and disbursing 8 funds from public or private sources to be used to enhance 9 bioscience-based economic development in the state and to 10 further the overall development and economic well-being of the 11 state. 12 Sec. 6. Section 15.106B, subsection 2, paragraph d, 13 subparagraph (1), Code 2019, is amended by adding the following 14 new subparagraph division: 15 NEW SUBPARAGRAPH DIVISION . (i) Services to expand, 16 enhance, and advance the bioscience development platforms. 17 Sec. 7. Section 15.107, Code 2019, is amended by striking 18 the section and inserting in lieu thereof the following: 19 15.107 Bioscience development corporation. 20 1. The authority shall establish a bioscience development 21 corporation as a nonprofit corporation organized under chapter 22 504 and qualifying under section 501(c)(3) of the Internal 23 Revenue Code as an organization exempt from taxation. Unless 24 otherwise provided in this subchapter, the corporation is 25 subject to the provisions of chapter 504. The corporation 26 shall be established for the purpose of providing services and 27 receiving and disbursing funds from public or private sources 28 to enhance bioscience-based economic development in the state 29 and to further the overall development and economic well-being 30 of the state. 31 2. The corporation shall collaborate with the authority as 32 described in this subchapter, but the corporation shall not 33 be considered, in whole or in part, an agency, department, or 34 administrative unit of the state. 35 -2- LSB 1280HV (1) 88 ko/tm 2/ 7

H.F. 477 a. The corporation shall not receive appropriations from the 1 general assembly. 2 b. The corporation shall not be required to comply with 3 any requirements that apply to a state agency, department, or 4 administrative unit and shall not exercise any sovereign power 5 of the state. 6 c. The corporation shall not have authority to pledge the 7 credit of the state, and the state shall not be liable for 8 the debts or obligations of the corporation. All debts and 9 obligations of the corporation shall be payable solely from the 10 corporation’s funds. 11 3. a. The corporation shall be established so that 12 donations and bequests to the corporation qualify as tax 13 deductible under state income tax laws and under section 14 501(c)(3) of the Internal Revenue Code. 15 b. The corporation shall be established for the purpose of 16 expanding bioscience-based economic development opportunities 17 in the state of Iowa and for Iowa businesses, and to further 18 the overall development and economic well-being of the state. 19 The corporation may effectuate this purpose by performing 20 certain functions delegated to it by the authority pursuant to 21 section 15.106B. 22 4. The articles of the corporation shall provide for its 23 governance and its efficient management. In providing for its 24 governance, the articles of the corporation shall address the 25 following: 26 a. A board of directors to govern the corporation. 27 (1) The board of directors shall initially be comprised of 28 seven members appointed by the governor to concurrent terms 29 of three years. Two of such members shall be subject to 30 confirmation by the senate. 31 (2) For appointments subsequent to the initial appointments 32 pursuant to subparagraph (1), two of the members shall be 33 appointed by the governor, subject to confirmation by the 34 senate, to staggered terms of three years each, and the 35 -3- LSB 1280HV (1) 88 ko/tm 3/ 7

H.F. 477 remaining five members shall be selected by a majority vote of 1 the board of directors of the corporation for terms the length 2 of which shall be provided in the articles of the corporation. 3 (3) The governor and the board of directors of the 4 corporation shall not appoint or select any person who is 5 either the spouse or a relative within the first degree of 6 consanguinity of a serving member of the board of directors or 7 of the authority board. 8 b. The appointment of a chief executive officer by the board 9 to manage the corporation’s daily operations. 10 c. The delegation of such powers and responsibilities 11 to the chief executive officer as may be necessary for the 12 corporation’s efficient operation. 13 d. The employment of personnel necessary for the efficient 14 performance of the duties assigned to the corporation. All 15 such personnel shall be considered employees of a private, 16 nonprofit corporation and shall be exempt from the personnel 17 requirements imposed on state agencies, departments, and 18 administrative units. 19 e. The financial operations of the corporation including the 20 authority to receive and expend funds from public and private 21 sources and to use its property, money, or other resources for 22 the purpose of the corporation. 23 5. The board of directors of the corporation and the chief 24 executive officer shall act to ensure all of the following: 25 a. That the corporation reviews and, at the board’s 26 direction, implements the applicable portions of the strategic 27 plan developed by members of the authority pursuant to section 28 15.105. 29 b. That the corporation prepares an annual budget that 30 includes funding levels for the corporation’s activities and 31 that shows sufficient moneys are available to support those 32 activities. 33 c. That the corporation annually completes and files an 34 information return as described in section 422.15 and that the 35 -4- LSB 1280HV (1) 88 ko/tm 4/ 7

H.F. 477 information return is submitted to the general assembly. 1 Sec. 8. Section 15.107A, subsection 2, unnumbered paragraph 2 1, Code 2019, is amended to read as follows: 3 The corporation shall, to the extent its articles so provide 4 and within its public purpose, do all of the following with 5 the purpose of increasing innovation in Iowa’s economy , and 6 bringing more innovative businesses to the state , and enhancing 7 and expanding the bioscience development platforms : 8 Sec. 9. Section 15.107A, subsection 2, paragraph b, Code 9 2019, is amended to read as follows: 10 b. Act as an innovation intermediary by aligning local 11 technologies, assets, and resources to work together on 12 advancing innovation and the bioscience development platforms . 13 Sec. 10. Section 15.107C, subsection 2, paragraph b, Code 14 2019, is amended to read as follows: 15 b. The report shall describe how the operations and 16 activities serve the interests of the state , enhance 17 bioscience-based economic development in the state, and further 18 economic development. 19 Sec. 11. Section 15.117A, subsection 2, paragraph a, 20 subparagraphs (1) and (2), Code 2019, are amended to read as 21 follows: 22 (1) Twenty members selected by the board to serve staggered, 23 two-year terms beginning and ending as provided in section 24 69.19 . Of the members selected by the board, seven fourteen 25 shall be representatives from businesses in the targeted 26 industries and thirteen six shall be individuals who serve 27 on the technology commercialization committee created in 28 section 15.116 , or other committees of the board, and who 29 have expertise with the targeted industries. At least ten of 30 the members selected pursuant to this subparagraph shall be 31 executives actively engaged in the management of a business in 32 a targeted industry. The members selected pursuant to this 33 paragraph shall reflect the size and diversity of businesses 34 in the targeted industries and of the various geographic areas 35 -5- LSB 1280HV (1) 88 ko/tm 5/ 7

H.F. 477 of the state. 1 (2) One member, selected by the governor board , who also 2 serves on the Iowa capital investment board created in section 3 15E.63 has experience supporting businesses in the targeted 4 industries . 5 Sec. 12. TRANSITION —— APPOINTMENT AND TERMS OF IOWA 6 INNOVATION COUNCIL MEMBERS. This Act shall not affect the 7 appointment or term of a member serving on the Iowa innovation 8 council immediately prior to the effective date of this Act. 9 EXPLANATION 10 The inclusion of this explanation does not constitute agreement with 11 the explanation’s substance by the members of the general assembly. 12 This bill relates to bioscience-based economic development, 13 the establishment of a bioscience development corporation, and 14 membership on the Iowa innovation council. 15 The bill replaces the Iowa innovation corporation with a 16 bioscience development corporation. The bioscience development 17 corporation is structured similarly and functions similarly to 18 the Iowa innovation corporation. The bioscience development 19 corporation has the added duty and responsibility of enhancing 20 the state’s bioscience-based economic development. The bill 21 defines “bioscience-based economic development” as economic 22 development related to industries involved in any of the 23 “bioscience development platforms”, which are defined as 24 industries involved in vaccines and immunotherapeutics, 25 biobased chemicals, precision and digital agriculture, and 26 medical devices and diagnostics. 27 The bill changes the number of members who are selected by 28 the board for the Iowa innovation council. Members who are 29 representatives from businesses in targeted industries increase 30 from 7 to 14, and members who are individuals who serve on the 31 technology commercialization committee, or other committees of 32 the board, and who have expertise with the targeted industries 33 are reduced from 13 to 6. In addition, one member will be 34 selected by the board and must have experience supporting 35 -6- LSB 1280HV (1) 88 ko/tm 6/ 7

H.F. 477 businesses in the targeted industries. Currently, that member 1 is selected by the governor and has to also serve on the Iowa 2 capital investment board. The bill provides that a member 3 serving on the council immediately prior to the effective date 4 of this Act shall continue to serve until the member’s term 5 expires. 6 -7- LSB 1280HV (1) 88 ko/tm 7/ 7