It seems like just yesterday I was writing my first column of the 126th Legislature, and talking about Democratic priorities and goals for the session. We knew Mainers wanted us to work on developing Maine’s workforce and help put Mainers back to work. We knew Mainers wanted us to strengthen public education. We knew Mainers wanted us to lower the cost of both healthcare and energy. We knew Mainers wanted us to focus on our state’s future and find smart ways to invest in research and development and our transportation infrastructure, including our roads and bridges.
It would take many columns to discuss all the progress we made towards each of those goals, so I will focus on one particular piece of legislation which I believe will be crucial to strengthening our economy and bringing jobs to Maine. The measure, which I sponsored, will provide funding to help Maine businesses secure financing by extending and improving the successful Maine Seed Capital Tax Credit Program.
A recent article in the Portland Press Herald noted that there are too few high-tech, high-skills, and typically high paying jobs in Maine. Although these jobs are slowly increasing in number, the Seed Capital Tax Credit will help startups and small businesses in these developing fields open their doors and expand their business.
Maine entrepreneurs frequently recount the challenges faced in securing venture capital and private equity investments, which are key for the expansion of many businesses. Maine falls way behind the nation and even other New England states in average venture capital investment per capita, with only one-third the average annual investment per capita of Vermont and about one-ninth the annual investment in neighboring New Hampshire.
At the beginning of the session, the existing Maine Seed Capital Tax Credit Program hit its statutory $30 million cap, and without action, the incredibly successful program would have ceased. It was clear that we could not allow the program to expire. In just the past year, the program resulted in $4.67 million invested in a dozen Maine companies, and since the creation of the program, 128 Maine companies have received capital.
While we had to amend the bill due to limited state resources it will still provide bridge funding for the program over the next two years, andthen $675,000 in 2014, $4 million in 2015, and $5 million in 2016. For every $1 we spend it will yield $8 of investment in Maine businesses.
To ensure the program benefits not only the company, but also Mainers looking for jobs, businesses applying for the Maine Seed Capital Tax Credit Program must certify that the amount of the credit is necessary to allow the business to create or retain jobs in the State.
As I write this column, the governor has not yet signed or vetoed the measure, but I have been told that he is a supporter of the legislation and I fully expect he will recognize the significance of the program and sign the bill into law.
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