Bill Text: IL HB4615 | 2013-2014 | 98th General Assembly | Introduced
Bill Title: Amends the Technology Development Act. Changes "may" to "shall" in certain provisions concerning investments of moneys in the Technology Development Account IIa. Effective immediately.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Failed) 2014-12-03 - Session Sine Die [HB4615 Detail]
Download: Illinois-2013-HB4615-Introduced.html
| |||||||||||||||||||||||||
| |||||||||||||||||||||||||
| |||||||||||||||||||||||||
| |||||||||||||||||||||||||
| |||||||||||||||||||||||||
1 | AN ACT concerning finance.
| ||||||||||||||||||||||||
2 | Be it enacted by the People of the State of Illinois,
| ||||||||||||||||||||||||
3 | represented in the General Assembly:
| ||||||||||||||||||||||||
4 | Section 5. The Technology Development Act is amended by | ||||||||||||||||||||||||
5 | changing Section 11 as follows:
| ||||||||||||||||||||||||
6 | (30 ILCS 265/11) | ||||||||||||||||||||||||
7 | Sec. 11. Technology Development Account II. | ||||||||||||||||||||||||
8 | (a) In addition to the amount provided in Section 10 of | ||||||||||||||||||||||||
9 | this Act, the State Treasurer shall may segregate a portion of | ||||||||||||||||||||||||
10 | the Treasurer's investment portfolio, that at no time shall be | ||||||||||||||||||||||||
11 | greater than 2% of the portfolio, in the Technology Development | ||||||||||||||||||||||||
12 | Account IIa ("TDA IIa"), an account that shall be maintained | ||||||||||||||||||||||||
13 | separately and apart from other moneys invested by the | ||||||||||||||||||||||||
14 | Treasurer. Distributions from the investments in TDA IIa shall | ||||||||||||||||||||||||
15 | may be reinvested into TDA IIa without being counted against | ||||||||||||||||||||||||
16 | the 2% cap. The Treasurer shall may make investments from TDA | ||||||||||||||||||||||||
17 | IIa that help attract, assist, and retain quality technology | ||||||||||||||||||||||||
18 | businesses in Illinois. The earnings on TDA IIa shall be | ||||||||||||||||||||||||
19 | accounted for separately from other investments made by the | ||||||||||||||||||||||||
20 | Treasurer. | ||||||||||||||||||||||||
21 | (b) The Treasurer shall may solicit proposals from entities | ||||||||||||||||||||||||
22 | to manage and be the General Partner of a separate fund | ||||||||||||||||||||||||
23 | ("Technology Development Account IIb" or "TDA IIb") consisting |
| |||||||
| |||||||
1 | of investments from private sector investors that must invest, | ||||||
2 | at the direction of the Treasurer, in tandem with TDA IIa in a | ||||||
3 | pro-rata portion. The Treasurer shall may enter into an | ||||||
4 | agreement with the entity managing TDA IIb to advise on the | ||||||
5 | investment strategy of TDA IIa and TDA IIb (collectively | ||||||
6 | "Technology Development Account II" or "TDA II") and fulfill | ||||||
7 | other mutually agreeable terms. Funds in TDA IIb shall be kept | ||||||
8 | separate and apart from moneys in the State treasury. | ||||||
9 | (c) Moneys in TDA IIa shall may be invested by the State | ||||||
10 | Treasurer to provide venture capital to technology businesses | ||||||
11 | seeking to locate, expand, or remain in Illinois by placing | ||||||
12 | money with Illinois venture capital firms for investment by the | ||||||
13 | venture capital firms in technology businesses. "Venture | ||||||
14 | capital", as used in this Section, means equity financing that | ||||||
15 | is provided for starting up, expanding, or relocating a | ||||||
16 | company, or related purposes such as financing for seed | ||||||
17 | capital, research and development, introduction of a product or | ||||||
18 | process into the marketplace, or similar needs requiring risk | ||||||
19 | capital. "Technology business", as used in this Section, means | ||||||
20 | a company that has as its principal function the providing of | ||||||
21 | services, including computer, information transfer, | ||||||
22 | communication, distribution, processing, administrative, | ||||||
23 | laboratory, experimental, developmental, technical, or testing | ||||||
24 | services, manufacture of goods or materials, the processing of | ||||||
25 | goods or materials by physical or chemical change, computer | ||||||
26 | related activities, robotics, biological or pharmaceutical |
| |||||||
| |||||||
1 | industrial activity, or technology oriented or emerging | ||||||
2 | industrial activity. "Illinois venture capital firm", as used | ||||||
3 | in this Section, means an entity that has a majority of its | ||||||
4 | employees in Illinois or that has at least one managing partner | ||||||
5 | or member of the general partner domiciled in Illinois, and | ||||||
6 | that provides equity financing for starting up or expanding a | ||||||
7 | company, or related purposes such as financing for seed | ||||||
8 | capital, research and development, introduction of a product or | ||||||
9 | process into the marketplace, or similar needs requiring risk | ||||||
10 | capital. "Illinois venture capital firm" may also mean an | ||||||
11 | entity that has a track record of identifying, evaluating, and | ||||||
12 | investing in Illinois companies and that provides equity | ||||||
13 | financing for starting up or expanding a company, or related | ||||||
14 | purposes such as financing for seed capital, research and | ||||||
15 | development, introduction of a product or process into the | ||||||
16 | marketplace, or similar needs requiring risk capital. For | ||||||
17 | purposes of this Section, "track record" means having made, on | ||||||
18 | average, at least one investment in an Illinois company in each | ||||||
19 | of its funds if the Illinois venture capital firm has multiple | ||||||
20 | funds or at least 2 investments in Illinois companies if the | ||||||
21 | Illinois venture capital firm has only one fund. In no case | ||||||
22 | shall more than 10% of the capital in the TDA IIa be invested | ||||||
23 | in firms based outside of Illinois. | ||||||
24 | (d) Any fund created by an Illinois venture capital firm in | ||||||
25 | which the State Treasurer places money pursuant to this Section | ||||||
26 | shall be required by the State Treasurer to seek investments in |
| |||||||
| |||||||
1 | technology businesses seeking to locate, expand, or remain in | ||||||
2 | Illinois. Any fund created by an Illinois venture capital firm | ||||||
3 | in which the State Treasurer places money under this Section | ||||||
4 | ("TDA II-Recipient Fund") shall invest a minimum of twice (2x) | ||||||
5 | the aggregate amount of investable capital that is received | ||||||
6 | from the State Treasurer under this Section in Illinois | ||||||
7 | companies during the life of the fund. "Illinois companies", as | ||||||
8 | used in this Section, are companies that are headquartered or | ||||||
9 | that otherwise have a significant presence in the State at the | ||||||
10 | time of initial or follow-on investment. Investable capital is | ||||||
11 | calculated as committed capital, as defined in the firm's | ||||||
12 | applicable fund's governing documents, less related estimated | ||||||
13 | fees and expenses to be incurred during the life of the fund. | ||||||
14 | Any TDA II-Recipient Fund shall also invest additional | ||||||
15 | capital in Illinois companies during the life of the fund if, | ||||||
16 | as determined by the fund's manager, the investment: | ||||||
17 | (1) is consistent with the firm's fiduciary | ||||||
18 | responsibility to its limited partners; | ||||||
19 | (2) is consistent with the fund manager's investment | ||||||
20 | strategy; and | ||||||
21 | (3) demonstrates the potential to create risk-adjusted | ||||||
22 | financial returns consistent with the fund manager's | ||||||
23 | investment goals. | ||||||
24 | In addition to any reporting requirements set forth in | ||||||
25 | Section 10 of this Act, any TDA II-Recipient Fund shall report | ||||||
26 | the following additional information to the Treasurer on a |
| |||||||
| |||||||
1 | quarterly basis for all investments: | ||||||
2 | (1) the names of portfolio companies invested in during | ||||||
3 | the applicable investment period; | ||||||
4 | (2) the addresses of reported portfolio companies; | ||||||
5 | (3) the date of the initial (and follow-on) investment; | ||||||
6 | (4) the cost of the investment; | ||||||
7 | (5) the current fair market value of the investment; | ||||||
8 | (6) for Illinois companies, the number of Illinois | ||||||
9 | employees on the investment date; and | ||||||
10 | (7) for Illinois companies, the current number of | ||||||
11 | Illinois employees. | ||||||
12 | If, as of the earlier to occur of (i) the fourth year of | ||||||
13 | the investment period of any TDA II-Recipient Fund or (ii) when | ||||||
14 | that TDA II-Recipient Fund has drawn more than 60% of the | ||||||
15 | investable capital of all limited partners, that TDA | ||||||
16 | II-Recipient Fund has failed to invest the minimum amount | ||||||
17 | required under this subsection (d) in Illinois companies, then | ||||||
18 | the Treasurer shall deliver written notice to the manager of | ||||||
19 | that fund seeking compliance with the minimum amount | ||||||
20 | requirement under this subsection (d). If, after 180 days of | ||||||
21 | delivery of notice, the TDA II-Recipient Fund has still failed | ||||||
22 | to invest the minimum amount required under this subsection (d) | ||||||
23 | in Illinois companies, then the Treasurer may elect, in | ||||||
24 | writing, to terminate any further commitment to make capital | ||||||
25 | contributions to that fund which otherwise would have been made | ||||||
26 | under this Section. |
| |||||||
| |||||||
1 | (e) Notwithstanding the limitation found in subsection (d) | ||||||
2 | of Section 10 of this Act, the investment of the State | ||||||
3 | Treasurer in any fund created by an Illinois venture capital | ||||||
4 | firm in which the State Treasurer places money pursuant to this | ||||||
5 | Section shall not exceed 15% of the total investments in the | ||||||
6 | fund. | ||||||
7 | (f) The State Treasurer shall not invest more than | ||||||
8 | one-third of Technology Development Account II in any given | ||||||
9 | calendar year. If in any calendar year less than one-third of | ||||||
10 | Technology Development Account II is invested, 50% of the | ||||||
11 | shortfall shall may be invested in the following calendar year | ||||||
12 | in addition to the regular one-third investment. | ||||||
13 | (g) The Treasurer shall may deposit no more than 10% of the | ||||||
14 | earnings of the investments in the Technology Development | ||||||
15 | Account IIa into the Technology Development Fund.
| ||||||
16 | (Source: P.A. 97-197, eff. 7-25-11.)
| ||||||
17 | Section 99. Effective date. This Act takes effect upon | ||||||
18 | becoming law.
|