Walker signs bill to boost early-stage investment
Gov. Scott Walker has signed legislation designed to spur more private investment in early-stage businesses.
The measure, Senate Bill 463, modifies the state’s angel investment and early-stage investment tax credit program by allowing the state to recapture the value of tax credits from companies that move out of state within three years of receiving qualifying investments.
The bill, sponsored by Sen. Joe Leibham, R-Sheboygan, and Rep. Mike Kuglitsch, R-New Berlin, also changes the criteria the Wisconsin Economic Development Corp. can use for recertifying a company for participation in the program after it had been approved for tax credits, and it enables the WEDC to recertify a company that has more than 100 employees or has been in operation more than 10 years.
The angel investment tax credit program allows a taxpayer to claim a tax credit that equals 25% of an angel investment made directly in a qualified new business venture that is certified by the WEDC. Since 2005, 195 young companies have been certified to receive tax credit assistance, which has leveraged more than $163 million in investment in those companies.
According to the state, these investments have affected at least 930 new jobs.
Walker also signed Senate Bill 459, which allows the Wisconsin Housing and Economic Development Authority to issue federally tax-exempt bonds to finance new business expansion projects. Proponents say it will open the door for more small business owners to use the bonds as a funding source.
WHEDA provides low‐cost financing for housing, small business, and agricultural development, but SB 459 removes restrictions that limit the kinds of businesses that can qualify for WHEDA financing of business development projects. The measure broadens the definition of an eligible economic development project to include manufacturing or commercial real estate projects, retail sales companies, and certain activities like research and development activities and long-term working capital.
The bill, authored by Sen. Joe Leibham, R-Sheboygan, and Rep. Michelle Litjens, R-Oshkosh, also replaces a $200 million lifetime cap with an annual $150 million limit for the next six years.