House, Senate reconcile differences on economic development, R&D proposals

3/7/2016

By MICHAEL MARTZ Richmond Times-Dispatch

The House of Delegates and Senate on Monday narrowed differences between themselves and Gov. Terry McAuliffe on two key pieces of legislation to promote economic development and research, which also would help clear the way to agreement on a two-year state budget.

The House Appropriations Committee approved a new version of the Virginia Growth and Opportunity Act, known as GO Virginia, that would alter the makeup of a new statewide governing board to give the governor an equal number of appointments as the House and Senate, as McAuliffe had requested.

Later, the Senate Finance Committee approved a substitute House proposal that would create the Virginia Research Investment Fund to oversee state funding of major academic R&D projects, yielding to the position of the Senate and governor rather than folding it under the GO Virginia board.

The actions, if approved by each chamber, would partly clear the way for agreements on two of the biggest issues pending in negotiations over the budget and pending bond legislation. Budget conferees from both chambers still have to resolve differences on how much money to give the GO Virginia and R&D initiatives, as well as how much capital funding to devote to research facilities.

The issues are central concerns of McAuliffe, who has expressed displeasure with the proposed governing structure of GO Virginia and the earlier proposal by House Appropriations Chairman S. Chris Jones, R-Suffolk, to put the research initiative under the control of what the governor described last week as “a board dominated by the legislature.”

The governor’s office had no comment on the twin actions on Monday, pending the outcome of budget negotiations between the chambers. “We want to see all of what comes out,” McAuliffe spokesman Brian Coy said.

The House increased the governor’s citizen appointments from three to four, equal to that of the House speaker and Senate Rules Committee, in a new version of Senate Bill 449, sponsored by Senate Majority Leader Thomas K. Norment Jr., R-James City. The new bill also would reduce the number of sitting senators on the board from four to three, while the numerically larger House would have four seats.

Senate Finance then approved a substitute Jones offered for Senate Bill 1343. The substitute would place the R&D initiative in a new fund overseen by a seven-member committee that would include the staff directors of the assembly money committees, the director of the State Council for Higher Education of Virginia, the governor’s secretary of finance, and three citizen members of the GO Virginia board.

The Virginia Research Investment Fund would rely on the Virginia Retirement System to invest and manage assets that would include state general funds as well as proceeds from the potential sale of the Center for Innovative Technology in Northern Virginia, as the Senate has proposed in the budget.

The fund’s governing committee could disburse up to $4 million a year for approved research projects involving collaboration among Virginia colleges, universities, and private companies to turn academic research into commercial ventures that stimulate the state’s economy.

The amount of money to establish the new initiative depends on the outcome of negotiations between the two chambers on the budget and bond bills. McAuliffe proposed almost $39 million for GO Virginia, $40 million for higher education research, and $100 million in bonds for laboratories and equipment.

The Senate backed McAuliffe on GO Virginia, while the House proposed about $32 million. The House backed the governor on research, while the Senate trimmed the request to $30.5 million. The Senate included $65 million in bonds for research, while the House proposed $20 million, plus $30 million for lab renovations and equipment at the Global Genomics & Bioinformatics Institute in Northern Virginia.

The legislature is still hashing out differences in a companion bill to GO Virginia. The measure would create regional councils to administer grants for economic development projects proposed in cooperation by at least two local governments and private business. The primary difference relates to the threshold of new jobs and investment for project eligibility.