S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  7048

                            I N  S E N A T E

                              March 9, 2010
                               ___________

Introduced  by  Sen.  STACHOWSKI  -- read twice and ordered printed, and
  when printed to be committed to the Committee on Corporations, Author-
  ities and Commissions

AN ACT to amend the public authorities law, in relation to the New  York
  incubator network

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1.  Legislative Intent. The legislature hereby recognizes that
supporting a statewide network of university affiliated business incuba-
tors, selected on a competitive basis that maintain  not  only  physical
facilities  but also most current industry best practice business devel-
opment services is a cost effective approach to supporting start-up  and
early  stage  companies  and  helping the state's creative entrepreneurs
successfully  transition  technological  breakthroughs  with  commercial
potential  from  the  laboratory  to the marketplace. This investment in
university affiliated business incubators will support regional develop-
ment and local economic diversification, job creation, and the retention
of the state's vast resources of intellectual capital.
  S 2.  The public authorities law is amended by adding  a  new  section
3102-f to read as follows:
  S  3102-F. NEW YORK INCUBATOR NETWORK. THE FOUNDATION IS AUTHORIZED TO
DESIGNATE TEN INCUBATORS AS PART OF THE NEW YORK INCUBATOR NETWORK. SUCH
DESIGNATIONS SHALL BE MADE IN ACCORDANCE WITH THE STANDARDS AND CRITERIA
SET FORTH IN SUBDIVISION TWO OF THIS SECTION AND WILL LAST FOR A  PERIOD
OF  FIVE  YEARS.  INCUBATORS SO DESIGNATED SHALL BE ELIGIBLE FOR SUPPORT
FROM THE FOUNDATION IN THE MANNER PROVIDED FOR IN SUBDIVISION  THREE  OF
THIS  SECTION,  AND  FOR  SUCH  ADDITIONAL  SUPPORT  AS MAY OTHERWISE BE
PROVIDED BY LAW.
  1. AS USED IN THIS SECTION: (A)  "INCUBATOR"  OR  "INCUBATE"  MEANS  A
UNIVERSITY  OR  UNIVERSITY-AFFILIATED RESEARCH INSTITUTE OR A CONSORTIUM
OF SUCH INSTITUTIONS,  DESIGNATED  BY  THE  FOUNDATION,  WHICH  PROVIDES
SERVICES  AND  FACILITIES  TO ENTREPRENEURS DURING THE START-UP PHASE OF
THEIR COMPANY LIFE-CYCLE.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD16351-01-0
              

S. 7048                             2

  (B) "APPLICANT" MEANS A UNIVERSITY, A  UNIVERSITY-AFFILIATED  RESEARCH
INSTITUTE  OR  INDEPENDENT  NOT-FOR-PROFIT INCUBATOR ESTABLISHED FOR THE
PURPOSE OF DEVELOPMENT OF ENTREPRENEURIAL  COMPANIES  THROUGH  PROVIDING
BUSINESS SUPPORT RESOURCES FOR ENTREPRENEURS DURING THE START-UP PERIOD.
  2. THE FOUNDATION SHALL:
  (A) IDENTIFY AREAS FOR WHICH INCUBATORS SHOULD BE DESIGNATED INCLUDING
AREAS  THAT  ARE  RELATED  TO  INDUSTRIES WITH SIGNIFICANT POTENTIAL FOR
ECONOMIC GROWTH AND DEVELOPMENT IN  NEW  YORK  STATE  AND  TECHNOLOGICAL
AREAS  THAT  ARE  RELATED  TO THE ENHANCEMENT OF PRODUCTIVITY IN VARIOUS
INDUSTRIES LOCATED IN NEW YORK STATE.
  (B) LOCATE INCUBATORS, IN EACH OF THE TEN ECONOMIC DEVELOPMENT REGIONS
TO THE EXTENT POSSIBLE IN AREAS WHERE THERE IS NOT  ALREADY  SIGNIFICANT
SUPPORT FOR BUSINESS INCUBATION.
  (C) ESTABLISH CRITERIA THAT APPLICANTS MUST SATISFY FOR DESIGNATION AS
AN INCUBATOR, INCLUDING, BUT NOT LIMITED TO THE  FOLLOWING:
  (I)  AN  ESTABLISHED  RECORD OF, OR PLAN TO CONFORM TO, BEST PRACTICES
INCLUDING CLEAR POLICIES FOR BUSINESS ENTRY AND GRADUATION;
  (II) A COMPREHENSIVE  SUITE  OF  ENTREPRENEURIAL  MENTORING  PRACTICES
INCLUDING  ADVISING, COACHING, PLANNING AND CONNECTING TO FUNDING SOURC-
ES;
  (III) THE CAPACITY TO SECURE SUBSTANTIAL  PRIVATE  AND  OTHER  GOVERN-
MENTAL  FUNDING FOR THE PROPOSED INCUBATOR, IN AMOUNTS AT LEAST EQUAL TO
THE TOTAL OF SUPPORT SOUGHT FROM THE STATE;
  (IV) THE ABILITY  AND  WILLINGNESS  TO  COOPERATE  WITH  OTHER  LOCAL,
REGIONAL AND STATEWIDE ECONOMIC DEVELOPMENT, BUSINESS SUPPORT, VENTURES,
CAPITAL, WORKFORCE AND OTHER PARTNERS;
  (V) THE CAPACITY TO COLLABORATE WITH BUSINESS AND INDUSTRY;
  (D)  ESTABLISH  SUCH  REQUIREMENTS  AS  IT  DEEMS  APPROPRIATE FOR THE
FORMAT, CONTENT AND FILING OF APPLICATIONS FOR DESIGNATION AS INCUBATORS
FOR ENTREPRENEURIAL DEVELOPMENT.
  (E) ESTABLISH SUCH PROCEDURES AS IT DEEMS APPROPRIATE FOR  THE  EVALU-
ATION  OF APPLICATIONS FOR DESIGNATION AS INCUBATORS FOR ENTREPRENEURIAL
DEVELOPMENT, INCLUDING THE ESTABLISHMENT OF A REVIEW PANEL  COMPOSED  OF
NATIONALLY RECOGNIZED EXPERTS IN BUSINESS INCUBATION.
  (F)  UPON  THE  APPROVAL OF AN APPLICATION, CONFER AN INCUBATOR DESIG-
NATION UPON A SUCCESSFUL APPLICANT FOR A PERIOD OF  FIVE  YEARS,  UNLESS
OTHERWISE REVOKED BY THE FOUNDATION.
  (G)  THE  FOUNDATION  BOARD  SHALL  APPROVE  RULES AND REGULATIONS FOR
SELECTION OF INCUBATORS AND SHALL MAKE FINAL DESIGNATIONS  THROUGH  VOTE
OF MAJORITY OF APPOINTED MEMBERS OF THE FOUNDATION BOARD.
  3.  (A) FROM SUCH FUNDS AS MAY BE APPROPRIATED FOR THIS PURPOSE BY THE
LEGISLATURE, THE FOUNDATION SHALL  PROVIDE  FINANCIAL  SUPPORT,  THROUGH
CONTRACTS  OR  OTHER MEANS, TO DESIGNATED INCUBATORS FOR ENTREPRENEURIAL
DEVELOPMENT, IN ORDER TO ENHANCE AND ACCELERATE THE DEVELOPMENT OF  SUCH
INCUBATORS.  FUNDS RECEIVED PURSUANT TO THIS SUBDIVISION MAY BE USED FOR
PURCHASE OF EQUIPMENT AND FIXTURES, EMPLOYMENT OF DIRECT SERVICE  STAFF,
PROVISION OF INTERNSHIPS, AND OTHER PURPOSES APPROVED BY THE FOUNDATION,
BUT  MAY  NOT BE USED FOR CAPITAL CONSTRUCTION. IN EACH CASE, THE AMOUNT
PROVIDED BY THE FOUNDATION TO AN INCUBATOR SHALL BE MATCHED  BY  COMMIT-
MENTS  OF SUPPORT FROM PRIVATE AND GOVERNMENTAL SOURCES OTHER THAN STATE
SOURCES.
  (I) BEGINNING IN THE FOURTH ACADEMIC YEAR FOLLOWING THE ACADEMIC  YEAR
IN WHICH AN INCUBATOR IS FIRST DESIGNATED, THE FOUNDATION SHALL EVALUATE
ITS PERFORMANCE.
  (II)  THE  FOUNDATION WILL INITIATE A REDESIGNATION PROCESS IN ACCORD-
ANCE WITH THE STANDARDS AND CRITERIA  SET  FORTH  IN  PARAGRAPH  (B)  OF

S. 7048                             3

SUBDIVISION  TWO  OF  THIS SECTION AND IN ACCORDANCE WITH PARAGRAPHS (C)
AND (D) OF SUBDIVISION TWO OF THIS SECTION.
  (III)  IN YEAR FIVE THE FOUNDATION MAY DESIGNATE, SUBJECT TO AVAILABLE
APPROPRIATIONS, ADDITIONAL INCUBATORS.
  IN THE EVENT A NEW INCUBATOR IS SELECTED IN THE REDESIGNATION PROCESS,
THE FOUNDATION SHALL PROVIDE FUNDS TO SUCH NEW INCUBATOR  IN  ACCORDANCE
WITH  THE  FUNDING MATCH REQUIREMENTS SET FORTH IN SUBPARAGRAPHS (I) AND
(II) OF THIS PARAGRAPH.
  (B) CONTINUED FUNDING OF THE OPERATIONS OF  EACH  INCUBATOR  SHALL  BE
BASED  UPON  A  SHOWING  THAT:  THE  CENTER CONTINUES TO COMPLY WITH THE
CRITERIA ESTABLISHED BY THE FOUNDATION  PURSUANT  TO  PARAGRAPH  (B)  OF
SUBDIVISION TWO OF THIS SECTION; A DEMONSTRATION OF ASSISTANCE TO EMERG-
ING BUSINESSES IN NEW YORK STATE; COMPLIANCE WITH THE RULES, REGULATIONS
AND  GUIDELINES  OF  THE  FOUNDATION;  AND COMPLIANCE WITH ANY CONTRACTS
BETWEEN THE FOUNDATION AND THE DESIGNATED INCUBATOR.
  (C) EACH INCUBATOR SHALL REPORT ON ITS ACTIVITIES  TO  THE  FOUNDATION
BOARD IN A MANNER AND ACCORDING TO THE SCHEDULE ESTABLISHED BY THE FOUN-
DATION,  AND SHALL PROVIDE SUCH ADDITIONAL INFORMATION AS THE FOUNDATION
MAY REQUIRE.  THE FOUNDATION SHALL EVALUATE INCUBATOR  OPERATIONS  USING
METHODS  SUCH  AS  SITE  VISITS,  REPORTING OF SPECIFIED INFORMATION AND
REVIEW EVALUATIONS USING EXPERTS  IN  ENTREPRENEURIAL  DEVELOPMENT.  THE
FOUNDATION SHALL NOTIFY EACH INCUBATOR OF THE RESULTS OF ITS EVALUATIONS
AND  FINDINGS  OF  DEFICIENCIES  IN  THE OPERATION OF SUCH INCUBATOR AND
SHALL WORK WITH SUCH INCUBATORS TO REMEDY SUCH FINDINGS. IF SUCH FACTORS
ARE NOT REMEDIED, THE FOUNDATION MAY WITHDRAW THE STATE FUNDING SUPPORT,
IN WHOLE OR IN PART, OR WITHDRAW THE INCUBATOR DESIGNATION.
  4. THE FOUNDATION SHALL MAKE AN ANNUAL REPORT OF  THE  INCUBATORS  FOR
ENTREPRENEURIAL  DEVELOPMENT  PROGRAM TO THE GOVERNOR AND THE SPEAKER OF
THE ASSEMBLY, THE TEMPORARY PRESIDENT OF  THE  SENATE,  THE  LEGISLATIVE
COMMITTEES  ON  ECONOMIC  DEVELOPMENT  AND  TO THE FISCAL COMMITTEES NOT
LATER THAN  DECEMBER  THIRTY-FIRST  OF  EACH  YEAR.  SUCH  REPORT  SHALL
INCLUDE, BUT NOT BE LIMITED TO, A LIST OF ACTIVE TENANTS, THE RESULTS OF
THE  FOUNDATION'S  EVALUATION  OF  EACH  INCUBATOR, A DESCRIPTION OF THE
ACHIEVEMENTS OF EACH INCUBATOR, A COMPLETE FINANCIAL  STATEMENT  OF  THE
CORPORATION,  ANY DEFICIENCIES IN THE OPERATION OF EACH INCUBATOR, REME-
DIAL ACTIONS RECOMMENDED BY THE FOUNDATION, REMEDIAL  ACTIONS  TAKEN  BY
THE  INCUBATOR,  A  DESCRIPTION  OF BUSINESS ASSISTANCE PROVIDED BY EACH
INCUBATOR, A DESCRIPTION OF ANY EXTERNAL FUNDING ATTRACTED BY THE  INCU-
BATOR,  PARTNERSHIPS ENTERED INTO BY THE INCUBATOR, THE AMOUNT OF FINAN-
CIAL ASSISTANCE PROVIDED BY THE FOUNDATION AND  THE  LEVEL  OF  MATCHING
FUNDS  PROVIDED  EACH  INCUBATOR  AND  A  DESCRIPTION OF THE USE OF SUCH
MONIES.
  S 3. This act shall take effect immediately.