SB 247 BIOSCIENCE COMPANY INVESTMENTS

Sen Martin E Hickey

Actions: [4] SCC/STBTC/SFC-SCC

Scheduled: Not Scheduled

 Senate Bill 247 (SB 247) relates to economic development. SB 247 amends the Bioscience Development Act. SB 247 authorizes investment in bioscience companies and establishes requirements. Makes an appropriation. 

 Senate Bill 247 (SB 247) amends the Bioscience Development Act (Act) and authorizes investment in bioscience companies. SB 247 makes an appropriation.

SECTION 1 amends Executive Department  Section 9-15E-2 NMSA 1978 (being Laws 2017, Chapter 134, Section 2) in Definitions to add Subsection E to define “portfolio business” and Subsection G to define “New Mexico business”.

SECTION 2 adds a new section of the Act to provide the authority may invest in bioscience and provides requirements and reimbursement obligations.
A. The authority may invest in a bioscience business that meets the specification of this subsection, including being a New Mexico business or shall relocate to the state and maintain itself as a New Mexico business.

B. The authority shall assess a bioscience business prior to making an investment decision based on assessment factors with scoring weights determined by the authority as specified in this subsection.

C. Investments made pursuant to this section shall be made with a co-investing organization chosen by the authority in consultation with the University of New Mexico purchasing office through a competitive process; provided that the co-investing organization meets the  requirements specified in this subsection.

D. An investment contract with a portfolio business shall specify that: 
(1) if the portfolio business fails to meet its contractual obligations pursuant to this section, it shall either: (a) fully reimburse the authority for the bioscience development fund's cost basis in the portfolio business; or (b) document to the satisfaction of the authority that it has provided economic benefits to the state that exceed the authority's cost basis in the business; 
(2) in any sale of a majority of the assets or a majority of the voting stock of the business, the acquiring entity or set of affiliated entities shall assume the legal obligations of the contract with the authority; and
(3) in a bankruptcy proceedinga claim by the authority shall be paid first. 

E. When a portfolio business must compensate the authority pursuant to this section due to an acquisition by another entity or a relocation outside of the state, upon approval of the state investment council, the authority may accept stock in the acquiring entity in lieu of a cash payment. 

SECTION 3 makes an appropriation of $25,000,000 from the General Fund to the New Mexico bioscience authority for expenditure in Fiscal Year 2025 and subsequent fiscal years for investments pursuant to the Act. Any unexpended or unencumbered balance remaining at the end of a fiscal year shall not revert to the General Fund. 

SECTION 4 makes the effective date July 1, 2024.