Creation of the Wisconsin Seed Fund Authority and creation of the business seed fund, to be administered by the Wisconsin Seed Fund Authority

The bill gives the board the powers necessary or convenient to carry out its duties, as well as specific powers to conduct its corporate business. Under the bill, the authority is a participating employer in the Wisconsin Retirement System. The board may hire an executive director. In addition to the members appointed by the governor, the members of the board appointed by the speaker of the assembly and the senate majority leader and the executive director of the authority, if any, are subject to state ethics laws.

Business Seed Fund The bill directs the authority to establish a fund to be known as the "business seed fund" (fund).

Financing of the fund The bill allows a financial institution to designate to the Department of Revenue that up to 80 percent of its estimated income or franchise tax payment be deposited into the fund (participant financial institution). The bill defines a financial institution to be a bank, savings bank, savings and loan association, trust company, or credit union, whether chartered under the laws of this state, another state or territory, or under the laws of the United States.

Grants, loans, and investments of business seed fund capital Moneys in or received from the fund are referred to as "fund capital" in the bill.

Under the bill, the authority may make a grant or loan of fund capital to, or may make an investment of fund capital in, a business proposed to the authority by a participant financial institution. The authority may commit fund capital to such a grant, loan, or investment only if all of the following requirements are satisfied:

1. The business is or will be headquartered in Wisconsin.

2. The business is a seed or early stage business as determined by the authority.

3. The participant financial institution or the business demonstrates to the satisfaction of the authority that the grant, loan, or investment will assist the business to create and retain for a period of time established by the authority full-time jobs in addition to any existing full-time jobs the business already provides.

4. The authority's loan or investment in a business is on terms that are substantially equivalent to the terms applicable for the business's other lenders or investors that are in the seed capital industry.

Under the bill, the authority may share profits from a loan or investment with the participant financial institution that proposes that loan or investment. Also, the authority may require that a business that receives a grant of fund capital repay to the authority the amount of the grant under conditions established by the authority.

Reporting Requirements Under the bill, the authority must submit an annual report to the legislature and the governor that contains all of the following information:

1. An accounting of the moneys the authority received from participant financial institutions during the preceding year.

2. An accounting of all expenditures from the fund during the preceding year for any purpose.

3. For each business that received a grant, loan, or investment from the authority, the name and address of the business; a description of the nature of the business; the amount of the grant, loan, or investment; a description of the purposes for which the business used or is using the grant, loan, or investment; and a statement of the number of employees the business employed when the business first received a grant, loan, or investment of fund capital, the number of employees the business employed on January 1 of the year preceding the year of the report, and the number of employees the business employed on December 31 of that year.