Government Affairs Bootcamp Recap

Participate and Connect with Maryland Tech Council and Maryland County Leaders

Join us August 15, 2018 in Ocean City for The MACo 2018 Summer conference and Tech Expo Trade Show. Tech Expo is a one-day event, co-hosted by the Maryland Tech Council, featuring technology leaders, tech-focused educational sessions for local government officials, and partnership-building opportunities.

The Maryland Association of Counties (MACo) annual Summer Conference brings together government stakeholders from every level. The 2018 theme is “Water, Water Everywhere” and will focus on all the ways counties work with water. From the health of the Bay and Maryland’s waterways to the infrastructure, treatment, and regulations that ensure safe and healthy water flows through our pipes, county governments are keeping our residents afloat.  Click here for more information and to register. 

We Made a Difference! Legislative Wrap-up

We have been hard at work this Legislative Session to help Maryland Businesses Thrive and Grow. We have worked countless hours, attended hundreds of meetings, met weekly with our Legislative Committee and formed a 42 organization Legislative Coalition to protect and promote your businesses. This session we have accomplished:

• inMD Internship Platform
  Successfully getting allocations to roll out inMD Statewide Internship in the Governor’s proposed budget for 2019.
• Internships
  Successfully passing HB 527 Higher Education – Maryland Technology Internship Program – to provide Maryland Companies reimbursement for up to lesser of 50% or $3000 per student that does an internship.
• Cyber
  Successfully passing SB228 Cyber Security Incentive Tax Credits, giving tax credits to investors in Cyber Security Companies each year and tax credits to purchasers of cyber solutions in tax credits each year through 2022.
• Biotechnology
  We successfully defeated pricing legislation and reporting legislation that would significantly harm the biotech industry.
• BIO Investor Tax Credit
  We defeated legislation that would put this program at risk.
• R&D Tax Credits
  We defeated legislation that would significantly reduce the amount of credit that goes to many of our companies in R&D in the state.
• Director Liability
  We defeated legislation that would have prevented Maryland companies from attracting directors to their boards.
• Metro Funded
  We assisted in getting the Metro funding bill passed to help with transportation to get employees to and from work.

Next Session
We are already working on next session. We plan to put the following at the top of the list:

• 5G
  We must have legislation that makes 5G available to all of our Bio and Tech Companies in the state ASAP.
• R&D Tax Credit
  We must raise the amount of tax credit give to our innovative companies. Right now, companies only get 11% of what they apply for because of a cap much lower than any other innovative state in the country.
• Bio Investor Tax Credit
  This must be increased it as it is fully subscribed within 75 seconds of the application process opening.
• General Investor Tax for Innovative Companies
  We have successfully obtained a credit for bio and cyber. Now we need to help all of the other innovative industries get investment in the state.
• Lower Corporate Tax Rate
  We must advocate to become competitive with other innovative states on our corporate tax rate.
• RISE Zone
  We need to incentivize innovative companies to house companies in RISE Zone.

If you are interested in joining our legislative committee or legislative coalition, please contact me at Tami@mdtechcouncil.com.

Legislative Call to Action – Save the Biotech Investor Tax Credit and Research and Development Tax Credit

While the official legislative session for the state of Maryland starts January 10, 2018 and ends April 9, 2018,  it is important for the Maryland Tech Council and its members to start working NOW to make sure Maryland biotech and technology companies are heard and protected in Maryland.   Many of you have heard me say over the last year that Maryland is one of the top innovation hubs in the United States.  In order to stay at the top, we must have a talented workforce, great educational institutions, capital and legislation that supports our biotech and technology companies.   I believe that there is a huge movement by both the companies and the government to make sure that we have all of these things.  However, sometimes politics get in the way and some laws come out that threaten our companies’ ability to survive.  That is why the Maryland Tech Council is committed to advocating in Annapolis for laws that help our biotech and technology companies and defend against those that harm our companies.   

We have had many times in the past when we have spoken out loudly to help our companies and have been heard.  Now that we have merged the two largest tech councils in the state, we have doubled our voice and people are listening.   In the past the biotech and technology community assembled to fight the tech tax, price gouging bills and support tax credits to spur innovation.  We once again need everyone to assemble to have our voice heard. 

On December 5th a hearing in Annapolis discussed a report recommending that the General Assembly eliminate the biotechnology Investment Incentive Tax Credit and the Research and Development Tax Credit.  The Maryland Tech Council was at the hearing on this report loudly supporting the need for both of these tax credits.  We will hold an emergency meeting next week to mobilize the biotech and technology companies  to get out and make sure our legislators know that both of these tax credits MUST remain and in fact get additional financial support.  It is all of our duties to make our voice heard and let Maryland know the needs of our biotech and technology companies.   

We will also host a Legislative Day on January 18th starting with sessions in the morning, meetings with legislators, a rally and ending with a Leadership Dinner.  It is important that each and every bio and tech company participate and are heard so that the legislators know how strong we are and what our issues and needs are in the state.

Please help the Maryland Tech Council’s voice be heard loudly this year in Maryland.  Together, we need to make sure that Maryland is a state where Innovative companies have all of the resources they need to grow and thrive. 

If you would like to get more involved..contact me at tami@mdtechcouncil.com.  We welcome anyone who wants to help us in this mission to make Maryland a top innovation hub in the United States.  

Helping Protect Maryland’s Innovation Economy and Shaping the Policy Debate

Maryland Governor Announces New Initiative Aimed at Innovation Employers

Maryland Governor Larry Hogan recently announced a new, comprehensive statewide, economic development strategy called EXCEL MARYLAND. The initiative focuses on developing new collaborations to accelerate growth in the life sciences and cybersecurity industries. In focusing on sectors where Maryland already leads, EXCEL MARYLAND will pool the talents of state agencies, universities, and private sector industry experts.

The new effort will be guided by a steering committee in which Maryland Tech Council  (“MTC”) plays a prominent role. Membership on the Steering Committee includes MTC members MedImmune (Executive V.P. Dr. Bahija Jallal), Lockheed Martin (General Manager Stephanie Hill), Emergent BioSolutions (Daniel Abdun-Nabi), Tenable Network Security (Co-Founder Ron Gula), New Enterprise Associates (Managing Partner Peter Barris) and Convergence Technology Consulting (CEO Larry Letow).

Significantly, and in mark contrast with other Maryland initiatives, Governor Hogan has enlisted the assistance of a former leader of one of Maryland’s competitor states. The steering committee will be headed by Dr. Susan Windham- Bannister, the founder and first CEO of the Massachusetts Life Sciences Center (“the Center”). The Center is a quasi-public organization charged with managing the 10-year $1 billion Life Sciences Initiative enacted by the Massachusetts Legislature in 2008.  A hallmark of her tenure in Massachusetts was spreading the benefits of the initiative statewide and to a diverse population.

The steering committee is on a fast track and is due to deliver a report to the Governor by September 1, 2017. The report will serve as a road map on how Maryland will keep its position as the national leader in cybersecurity and advance in the biohealth and life sciences sectors.

Legislative Update

The 2017 Maryland General Assembly session has ended!  This “lightning” summary will tell you the outcome of the legislation that MTC and its Legislative Committee identified as priorities for Maryland innovation employers. 

A.  Price Gouging Bills:
HB 631/SB 415- Public Health – Essential Generic Drugs – Price Gouging – Prohibition –ENACTED

Maryland became the first state in the nation to authorize its Attorney General to pursue legal action against drug manufacturers and wholesalers who raise drug prices to “unconscionable” levels. MTC worked to have this bill restricted to those who act in an “unconscionable” manner and not have it involve responsible companies.

B.  Drug Transparency Bills:
SB 437/HB 666 – Public Health – Expensive Drugs – Manufacturer-Reporting and Drug Price Transparency Advisory Committee- DEFEATED

These bills originally would have required drug manufacturers to provide exhaustively detailed reports to Maryland’s Attorney General about internal costs that led to final drug prices. MTC opposed these bills as simplistic in their approach to drug pricing and misleading to the public.

C.  Research and Development Tax Credit Increase:
SB 200/HB 240-Income Tax Credit – Qualified R&D Expenses –ENACTED

These bills increase the total statewide limit on the tax credit for in-state R&D activities from $9 million to $12 million. MTC supported these bills.

D.  Biotechnology Tax Credit Changes:
SB 226 /HB 373 – Biotechnology Investment Tax Credit “BIITC”-ENACTED

These bills extend the eligibility period for this tax credit from the first 10 years of a bio-tech companies life to the first 12 years. Additionally, the eligibility for young companies awaiting regulatory approval is extended to 15 years.

The bills also allow entities to apply for the credit within 2 months of forming a company.

E.  Cyber-security Tax Credit Changes:
HB 378/SB 318 – Cybersecurity Investment Incentive Tax Credit-DEFEATED

These bills allow investors in cyber companies to take advantage of this tax credit. In addition, it allows new cyber entities to be eligible for the credit within 2 months of forming a company.

F.  Laboratory Registration:
HB 1172/SB 400-Department of Health and Mental Hygiene (DHMH) – Biosafety Level 3 Laboratories –DEFEATED

These bills would have required laboratories handling Biosafety level 3 material to register with the Maryland’s DHMH. MTC opposed this legislation as duplicative of federal registration and not useful to first responders.

In regards to the efforts in the drug pricing bill, over the course of the 2017 session, the Tech Council:

• Developed petitions attracting 4,366 signatures by Marylanders calling for lawmakers to support innovation-friendly legislation in our state.
• Launched a campaign that allowed 337 Marylanders to send 904 letters to their representatives in Annapolis.
• Engaged legislators on social media to encourage them to oppose the bills.
• Launched a statewide radio ad talking about the impact of this legislation.
• Ran digital advertisements through a homepage takeover the Annapolis Capital Gazette twice, around key moments in the legislative process – linking to a blog post where lawmakers, lobbyists and staff could find more information.
• Served Facebook advertisements to people within one square mile of the Annapolis statehouse, linking to the same blog post giving influencers more information.
• Targeted LinkedIn advertising to Marylanders with legislative job titles, including “state senator,” “delegate,” “legislative aide,” “legislative director,” and more directing to a post I wrote with more information.
• Throughout the course of the campaign, the Tech Council served 216,114 total ad impressions (how many times an ad was seen) to its target audiences – including 36,971 from the Capital Gazette homepage takeovers, 177,679 from Facebook advertising campaigns, and 1,464 from the LinkedIn advertising campaigns.

FINAL COUNTDOWN: Legislature Must Act On The Cybersecurity Investment Incentive Tax Credit

Important Legislation Strengthens Maryland’s Thriving Cybersecurity Industry

Harnessing Maryland’s Experienced Investors to Help TEDCO

Sometimes small changes hold the key to creating a better entrepreneurial environment.  That is why MTC has spent some time this month in Annapolis talking to legislators about a small but significant change to the State’s primary start-up funding entity, the Maryland Technology Development Corporation (TEDCO).

TEDCO was launched in 1998 to help commercialize the results of scientific research from higher education institutions, federal laboratories, and private sector organizations.  It is a quasi-public entity providing investments for early stage technology businesses.  It also funds technology business incubators.  TEDCO has a financial interest in over 400 Maryland companies.

Currently, the Maryland ethics law has a blanket prohibition on a State official having a financial interest in any entity that has a contract with the State.  This directly impacts TEDCO’s Board of Directors.  This provision makes it almost impossible for TEDCO to attract experienced angel investors and venture capitalists to their Board.  TEDCO needs these experienced Marylanders to direct their operations in order to keep TEDCO on track toward its objectives.  Since TEDCO is often the first outside funding a startup receives, Maryland investors on the Board are “walled off” from helping these companies later grow beyond their early stage.

Senate Bill 973 and House Bill 1073 make narrow changes to current Maryland law allowing Board members to still be subsequent investors in TEDCO companies.  They maintain other ethics protections including not allowing Board members to use their Board position to influence TEDCO investment decisions.

Maryland General Assembly 2017 – The Halfway Point

As the 2017 Maryland General Assembly session reaches the halfway point in its 90-day life, the Maryland Tech Council is engaged on several fronts to impact legislation, which both helps and harms Maryland’s Innovation economy.

Below is a brief summary of the current status of issues where MTC is most heavily involved.

SB 437 – Manufacturer Reporting and Drug Price Transparency – Oppose – Marty Rosendale, Executive Director, BioScience Division and Vice Chairman Brad Stewart both presented testimony against this legislation that would single out Maryland as inhospitable to drug research and manufacturing entities.  The simplistic slogans of the proponents hide a costly and complex reporting requirement that will have no impact on the price of drugs paid by the consumer.  The House version of this bill (HB 631) will be heard on February 23^rd and MTC will again present testimony. Meanwhile, MTC will actively participate in a “workgroup” session scheduled for February 27^th with the Senate Finance Committee.

SB 226 – Biotechnology Investment Tax Credit – Support – On February 17^th, this bill was approved by the Senate Budget and Taxation Committee.  This approval is a key step to this legislation becoming law.  The bill extends the time of eligibility for this tax credit for biotechnology companies at the beginning of their life.

SB 200 – Income Tax Credit for Qualified R &D Expenses – Support – CEO Tami Howie presented testimony in support of this bill in January.  On Feburary17^th, the Budget and Taxation Committee approved increasing the cap on the aggregate amount of tax credits for eligible R&D expenses from $9 million to $20 million in each calendar year.  This increase is phased in over three years.  Currently, the amounts requested for this tax credit in eligible applications far exceeds the cap.

HB 161 – Maryland Economic Development Assistance Fund – Support – MTC testified at the hearing on this important bill and continues to contact members of the Legislature to explain the organization’s support.  This bill changes and updates Maryland’s largest public lending fund to allow for loans for working capital.  This is significant for tech companies whose greatest asset is human capital, not buildings or specialized machinery.

SB400 – BioSafety Level 3 Labs- Registration – Oppose – MTC submitted testimony arguing that this new State registration requirement may duplicate Federal requirements and that the language of the bill would create confusion within the new regulatory agency – the State Department of Health and Mental Hygiene.  At the conclusion of testimony, the Chairman of the Committee stated that he was holding the bill to see if that Department could create a voluntary notification for labs.

As always, if you have any questions about these issues or others you have heard about you are welcome to contact either Joy Weber, Esq. (jweber@rwl.com) or Pat Roddy, Esq. ( proddy@rwl.com) for more information.