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Tech Council backs tax credit changes

Thursday, Dec. 22, 2005

Click here to enlarge this photo David S. Spence⁄The Gazette Julie Coons, president of the Tech Council of Maryland, says her organization’s legislative priorities for 2006 include changes in the biotech tax credit and funding the Intercounty Connector. Listening is Del. Paul S. Stull (R–Dist. 4A) of Frederick.

‘‘What we want to do is expand opportunities for technology companies to innovate, collaborate and grow their business,” Julie Coons, president of the Tech Council, said at a breakfast forum last week at MedImmune Inc.’s manufacturing facility in Frederick.

‘‘We work with the administration and the General Assembly to, we believe, enhance Maryland’s leadership position as a state that has a vibrant and successful technology community and one that we all know is growing,” Coons said. The state ‘‘is growing in national reputation and even international reputation.”

Easier access to capital is key for early-state companies, said Coons, whose organization represents more than 600 companies statewide. ‘‘For many companies in this state, that is a very critical issue.”

The council also wants to see increased opportunities for technology innovation, she said.

The Maryland Technology Development Corp. ‘‘is a leader in supporting technology innovation and we partner with them on a regular basis,” Coons said. ‘‘This is something that there is such an opportunity for in this state — building on that, gaining access to higher education and fostering collaboration between academia and the private sector.”

The biotech tax credit, adopted this year, needs tweaking, Coons said. The law provides a 50 percent tax credit to those who invest in a qualified Maryland biotech company. Credits are capped at $50,000 for individual investors and $250,000 for corporations and venture capital firms. However, the law, Coons pointed out, does not stipulate a specific level of funding, ‘‘putting the program at the mercy of the budget process.”

The Tech Council would like to see the state provide $15 million for tax credits in the program, she said. Also, the cap should be changed so that an investor in a specific biotech company could receive up to 20 percent of the total credits provided in a given year.

The council also calls for clarification that individual credits are for Maryland residents, which are provided on a first-come basis, and that the state would allocate the credits incrementally over a period of up to three years.

Adjusting the biotech tax credit ‘‘fits right in with our agenda,” said Del. Paul S. Stull (R–Dist. 4A) of Frederick, chairman of the county’s legislative delegation. ‘‘We need to follow up on funding.”

However, Del. Richard B. Weldon (R–Dist. 3B) of Frederick warned the business leaders to have ‘‘lower expectations for [next year’s legislative session] due to it being an election year.”

Coons also said the Tech Council supports the 18-mile, $2 billion-plus Intercounty Connector, which would link Interstate 95 in Laurel with Interstate 370 in Gaithersburg. The Frederick delegates generally back the highway, too.

‘‘We need more business in Frederick,” said Del. Patrick N. Hogan (R–Dist. 3A) of Frederick. ‘‘The I-270 corridor has been good for Frederick and it’s why we all support [additional funding] for transportation.”

The Tech Council will push for funding for stem cell research in the next session, Coons said.

Stull called stem cell research ‘‘a really, really touchy item, depending on who you’re talking to. Yet, I see we’re going to have to come up with a solution to this problem.”

Weldon said he has changed his mind on stem cell research and will support it.

‘‘I have had an epiphany,” Weldon said. ‘‘I intend to support a stem cell research bill ... If you look at this thoughtfully and carefully, there may be blessings that come from the incredible work that scientists do in relation to this research.”

Weldon also said a bill will be reintroduced requiring ‘‘transparent phase 1 clinical trials” for drug candidates, a bill that previously did not make it out of committee.

Marie Keegin, director of the Frederick County Office of Economic Development, said its important to support the Tech Council, citing its impact on Frederick County. The organization was instrumental in the opening earlier this year of the Frederick Innovative Technology Center Inc. incubator at Hood College, she said. A new incubator may soon be needed. ‘‘We are full, full, full,” she said.

‘‘We have 17 clients now, in less than 10 months, and we have a waiting list,” said Michael J. Dailey, director of the incubator.

Stull, Weldon and Hogan emphasized the importance of the business community making its collective voice heard in Annapolis.

‘‘My personal feeling is we have to follow up with funding for business and industry throughout this state, or they’re going to move south ... I’ve always been a big advocate of tax credits” to help grow industry, stull said.

‘‘My feeling is that the best thing we can do is stay out of the way and not over-burden you with taxes and regulations,” Hogan told the group. ‘‘That being said, there are a few things [I would like to address]...to support higher education, internships and incubators...those are [the places] where your workforce comes from.”