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Community development investment models supporting the biosciences

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Title:
Community development investment models supporting the biosciences
Physical Description:
1 online resource (iv, 66 p.) : charts ;
Language:
English
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University of South Florida -- Center for Economic Development Research
Publisher:
Center for Economic Development Research
Place of Publication:
Tampa, Fla
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Subjects / Keywords:
Community development -- Florida -- Hillsborough County   ( lcsh )
Investments -- Florida -- Hillsborough County   ( lcsh )
Economic conditions -- Hillsborough County (Fla.)   ( lcsh )
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non-fiction   ( marcgt )

Notes

Abstract:
Commissioned by the Hillsborough County Economic Development Department, this report reviews community-initiated development entity models, provides examples of community-initiated development High Technology - Bioscience models and outlines a model for The Hillsborough County initiated development project High-tech - Bioscience.
Statement of Responsibility:
an analysis performed by Center for Economic Development Research, College of Business Administration, University of South Florida.
General Note:
Title from PDF of title page (viewed Aug. 5, 2009).
General Note:
"September 2006."

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University of South Florida Library
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University of South Florida
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All applicable rights reserved by the source institution and holding location.
Resource Identifier:
aleph - 002023000
oclc - 429339374
usfldc doi - C63-00013
usfldc handle - c63.13
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SFS0000291:00001


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Community Development Investment Models Supporting the Biosciences An Analysis Performed by CENTER FOR ECONOMIC DEVELOPMENT RESEARCH College of Business Administration 1101 Channelside Dr., 2nd Floor N., Tampa, Florida 33602 Office: (813) 905-5854 or Fax: (813) 905-5856 September 2006

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Preface The Hillsborough County Economic Developmen t Departmen t (HCEDD) commissioned the Center for Economic Development Re search (CEDR) to conduct the applied economic research reported he rein. This study reviews co mmunity-initiated development entity models, provides examples of comm unity-initiated development High Technology Bioscience models and outlines a model for The Hillsborough County initiated development project High-tech Bioscience. CEDR, a unit of the University of South Floridas (USF) Co llege of Business Administration (COBA), initiates and conducts innovative research on economic development. The Centers education program s are designed to cultivate excellence in regional development. Our information syst em serves to enhance economic development efforts at USF, COBA, and throughout the Tampa Bay area and the state of Florida. Robert Forsythe, Dean, COBA, Univ ersity of South Florida (USF) Dennis Colie, Direct or, CEDR, COBA, USF Jim Snyders, CEDR Research Consu ltant and Principal Investigator Dodson Tong, Data Manager, CEDR, COBA, USF i

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Table of Contents Preface ...........................................................................................................................................................i Table of Contents ............................................................................................................................... ...........ii EXECUTIVE SUMMARY ......................................................................................................................... iv 1. Introductio n. .........................................................................................................................................1 2. Information Sources .............................................................................................................................2 3. Scope ............................................................................................................................... .....................2 4. Review of community -initiated development models. .........................................................................3 A. Community Development Entity (CDE) ..........................................................................................3 B. Community Development Financial Institutions .............................................................................6 C. Double Botto m Line Investment Funds (DBLIF) ............................................................................7 D. Early Stage Gap Financing ..............................................................................................................8 E. Summary Comparison of the models .............................................................................................10 5. New Market Tax Credit Opportunities and Demand. ........................................................................11 A. Current news from Washington on NMTC program .....................................................................11 B. Clearinghouse NMYC Investment Opportunities .......................................................................... 11 C. NMTC Reso urces Introduction to the NMTC Coalition .............................................................14 D. Examples of other Bioscience CDE activity in other communities ...............................................14 6. Examples of community-initiated development High Technology Bioscience models. .................24 A. Virginia' s Center for Innovative Technology (CIT) Program ........................................................24 B. Durham N.C., Research Triangle Park-based nonprofit Biotechnology Center ...........................24 C. Cleveland, BioEnterprise (June 2, 20 05) .....................................................................................25 D. Oxford Bioscience Partner s (OBP) ................................................................................................26 E. Portland, Ore. Bioscience Innovatio n Funds .................................................................................26 F. Pittsburg, Lif e Sciences Greenhouse LifeSPAN .........................................................................26 G. Rocky Hill, Connecticut Innovations (CI) Biotech Seed Fund ...................................................27 H. Kansas T echnology Enterprise Corporation (KTEC) ....................................................................27 I. Phoenix Com munity Development & Investment Corp. (PCDIC), New Market Program ...........28 7. The Hillsborough Count y initiated development project High-tech Bioscience model. .................29 A. Matrix of pos sible structure combinations .....................................................................................29 B. Vision of The Hillsborough County Initiated Development Project High-tech Bioscience model .......................................................................................................30 C. Project evolut ion of The Hillsborough County initiated development project High-tech Bioscience ..................................................................................................................30 D. Business Pla n outline .....................................................................................................................31 E. Community Impact Economic Assessment ................................................................................34 8. Findings Attributes and characteristics of potentially successful community-initiated development projects ..............................................................................................................................3 7 9. Summary The New Triple Bottom Line Community Development Economy ...............................39 Appendix A CDE Certification Q & A Document Community Development Financial Institutions Fund ................... 41 Appendix B 2006 NMTC Allocation Application Q & A Document, Community Development Financial Institutions Fund............................................................................................................................... ..........43 ii

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Appendix C Kansas Legislator Briefing Book 2005 .......................................................................................................46 Appendix D Phoenix Co mmunity Development and Investment Corporation Lending Guidelines for Bioscience or Technology Industries Effective, Date: PCDIC Board approved March 30, 2005. ...........53 Appendix E Co mmunity Impact Economic Assessment for the Bioscience / High-tech Industry Group ...................61 iii

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EXECUTIVE SUMMARY In this paper, we review the Commun ity Develo pment Entity (CDE), Community Development Financial Institution (CDFI) F und, Double Bottom Line Investment Funds (DBLIF), and Early Stage Gap Financing models. We create a matrix to help differentiate the models with regard to (1) wh at they are, (2) how they are used, and (3) how they are structured. The paper also includes information re lative to opportunities and demand for New Market Tax Credits (NMT C) and examples of community-initiated development models centered on High Technology Bioscience and the NMTC program. As part of the research process, we create a model outlining the structure of a new Hillsboroug h County initiated High-tech Biosci ence project. This includes a matrix of possible structure combinations, vision of the model, steps in the projects evolution, an outline of a Business Plan, and an economic assessment. Community development projects take on a vari ety of structures. Som e are large scale Low Income Community (LIC) projects based on tax credits or vent ure capital alliances, while others are on a smaller scale that rely on Angel Investors and Small Business Administration programs and funding. We iden tify key attributes and characteristics of successful community-initiated development projects. The projects tend to have four basic components: (1) management oversight and capacity, (2) capitalization and funding strategy, (3) a business plan, a nd (4) community impact. Furthermore, the success is more likely if these elements are all interr elated and linked with a governmental entity and private-sector investors. There are many ways in which communities em ploy both pr ivate and public resources to attempt to stimulate and improve the ec onomic well-being of sections of their community. Perhaps one of the most successf ul concepts involves the use of NMTC. There are significant opport unities and demand for using this approach to funding successful community growth projects. Additionally, the attributes and characteri stics of potentially successful community developm ent projects can be summarized into what has been labeled the New Triple Bottom Line concept. This concept emphasizes the importance of societies three values of P eople, M oney, and P roperty (PMP) working togeth er embracing three economic qualities of S ufficiency, O ptimization, and S ustainability. iv

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1. Introduction. The Community Development Entity (CDE), the Community Development Financial Institution (CDFI) Fund, Double Bottom Line Investment Funds (DBLIF), and Early Stage Gap Financing are the basic forms of a community-initiated development. In this paper we discuss these models and provide a quick comparison guide. This report includes a full section on oppor tunities and dem and for New Market Tax Credits. It provides updates on the CDFI fifth round of th e NMTC allocations and the U.S. Senates failure to pass legislati on to extend the NMTC program beyond 2007. Following this update is a summary of NM TC opportunities by Cl earinghouse NMTCs President and CEO, Douglas Bystry. We also provide a brief intr oduction to a valuable NMTC resource, i.e. the NMTC Coalitions. And, we include information about the demand for NMTC illustrated by examples of successful community-initiated development projects focused on High T echnology Bioscience and the NMTC program. The report has nine additional examples of community-initiated developm ent High Technology Bioscience models that have recently been implemented in the United States. From this information, we pres ent a matrix of possible structures. Additionally, we outline a visi on for a Hillsbo rough County initiated development project for High-tech Bioscience, including an outli ne of the projects evolution and a Business Plan. The final section of this report show su mmarizes findings of the attribu tes and characteristics of successful community-initiated development projects. The discussion includes the presentation of a very new con cept call the Triple Bottom Line Development values. 1

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2. Information Sources The primary information sources are Th e Departm ent of Treasury, Community Development Financial Institutions Fund, a nd the Small Business Administration web sites. 3. Scope The official report focuses on CDEs and other C ommunity Development Investment funding model options that might provide in centives for creating and promoting the biosciences industry within the USF Ente rprise Zone (EZ) and beyond. The study Discussion includes: Review of comm unity-initi ated development models o Community Developm ent Entity (C DE) and New Market Tax Credit (NMTC) Program o Community Developm ent Financial Institutions o Double Bottom Line Investment Funds o Early stage Gap Financing o Summary Comparison of the models New Market Tax Credits (NMT C) Opportunities and Demand o Current new s from Washington on NMTC program o Clearinghouse NMTC investm ent opportunities o NMTC Res ources Introduction to the NMTC Coalition o Examples of BioScience CDE activity in other communities Examples of community-initiated development High Technology Bioscience models The Hillsbo rough County initiated development project High-tech Bioscience model o Matrix of possible st ru cture combinations o Vision of model o Project evolution o Business Pla n outline Findings A ttributes and characteristic s of potentially successful communityinitiated development projects Summary the New Triple Bottom Line concept 2

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4. Review of community-in itiated development models. A. Community Development Entity (CDE) The term Community Development Entity (CDE ) can take on three dif ferent meanings. 1. CDE as defined by the US Internal Revenue Se rvice (IRS), is any domestic corporation or partnership that is an intermediary vehicl e for the provision of loans, investments or financial counseling in Low-Income Communities (LICs). It can be for-profit or nonprofit. A CDE is required to demonstrate that it: have a primary m ission of serving, or provi ding investment capital for, LICs or LowIncome Persons, and are accountable to residents of the LICs that they serve. 2. Certified CDE is one that has gone through and b een approved by the CDFI as a CDE that is Qualified to be eligible to apply for NMTC. 3. Simple CDE with no certification and no commitment to LIC. This title for a community project may be incorrectly or loosely used for community project that may in some way benefit a community but does not directly se rve an officially designated LIC area. Although referred to as a CDE it may not a corr ect use of the term and can confuse the reader. The main objectives of CDEs and other devel opment opportunities put fo rth in this paper are intended to stim ulate economic growth and co mmunity development in low income areas designated as Enterprise Zones (EZs) or some times called Empowerment Zones or Low-Income Communities (LICs). There is only one main reason to form a CDE and that is to improve econom ic conditions to LIC persons and to a LIC area. Likewi se there is only one reason to obt ain the status of a Certified CDE. That reason being so as to be eligib le to apply for NMTCs and other capitalization incentives sponsored by The CDFI Fund. There is a formal application process to become a Certif ied CDE. The complete application form can be found at: http://www.cdfifund.gov/docs/certificati on/CDE/CDEcertifica tionApplication.pdf Each CDE NMTC Allocation awardee, as well as CDEs that ar e recipients of Qualified LowIncom e Community Investments (QLICIs) from other CDEs, may be required to annually certify to the Fund that it continues to meet the Prim ary Mission and Accountability requirements by providing the information below. The Fund may revoke a CDEs certification if it fails to provide the requested inform ation. Information indicating that the entity remains accountable to th e LIC(s) it is serving; and A certification statem ent certifying that no mate rial changes have occurred to affect their current status as a CDE. CDEs are structured like any domestic corporatio n or partnership. CDE may be either non-profit or for profit and have subsidiari es consisting of either. There is nothing special about them except for the following: 3

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In general, sole proprietorships and singl e member limited liability companies are not considered corporations or pa rtnerships for federal tax pur poses, so these entities would not meet the legal entity test. A governm ental entity may apply for desi gnation as a CDE, provided the entity is classified as a corporation or partnership for federal tax purposes and would meet the legal entity requirement (which is subject to legal interpretation by the CDFI Fund). The LIC m ust be represented on the board. The following are characteristics board members must possess in order to be deemed a representative of LICs: o reside in a L IC in the Applicant CDEs service area; or o otherwise represent the interests of resi dents of LICs in the Applicant C DEs service area. Examples of individuals that re pre sent the interests of residents of LICs include, but are not limited to: A small business owner whose business is located in a LIC, and whose business: (i) provides goods and services to community residents; or (ii) principally employs residents of LICs. For the purpose of this requirement, an owner shall include any individual with at least 50% ownership stake in the business, or any individual th at has an ownership stake and controls, operates or manages the business; An employee or board member of a community-based or charitable organization principally serving the LICs. Employees or boa rd members of an orga nization that serves Low-Income Persons (as opposed to LICs) may also qualify, but only if it can be demonstrated that the population served by that organization principa lly resides in LICs; A religious leader whose congr egation is based in a LIC; An employee of a governmental agency or depa rtment that principally serves LICs, or a governmental employee whose daily job res ponsibilities principall y serve LICs; and An elected o fficial whose constituency is comprised principally of LICs or residents of LICs. There were 2206 Certified Co mm unity Development Entities as of March 1, 2006. These organizations have been certi fied by the Community Developm ent Financial Institutions Fund (Fund) as Community Development Entities (CDEs) The organizations are listed alphabetically by state and city and be f ound at: http://www.cdfifund.gov/docs/ certification/CDEstate.pdf Additional information regarding CDEs can be f ound in the for m of frequently asked Questions & Answers FAQ at web site http://www.cdfifund.gov/docs/certificat ion/CDE/CDEcertificationFAQs.pdf Appendix A provides a list of the questions in this docum ent. Because the main reason to form a Certified CD E is to participate in the NMTCs (New Market Tax Credits) program, it is important to remember that the CDE: o Must be Q ualified CDE o Exchange Tax Credits for Equity o For-Profit entities only o A non-profit organization m ay establish a for-profit Subsidiary entity as a CDE 4

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o For-profit Subsidiary CDE may apply direct ly to the Fund for an allocation of tax credits; or o Non-profit parent m ay apply to the Fund fo r an allocation of tax credits with the intention of transferring allocations to its for-profit Subsidiary CDE(s). The complete NMTC application form and gui dance can be f ound at the following web site: http://www.cdfifund.gov/docs/NM TC/2005/2006NMTCapplication.pdf As an overview the following chart depicts the flow process of the NMTC. It indicates that the process em anates from the US Treasury Department and centers on the CDE that has become Qualified for NMTC program. The arrow shows Investors receiving Tax Credits in turn for Equity in the CDE. (Reference:http://www.novoco.com/NMTC/Res ources/TonyBrownCRAuses.pdf#search='bank% 20enterprise%20awards' Community Comptroller of the Currency Deve lopm ents Administrator of National Banks Summer 2002 Community Affairs OnLine News Articles Ba nk Enterprise Awards and New Markets Tax Credits: Two Tools to Increase the Flow of Private Capital in Targeted Markets, By Tony T. Brown, Director, CDFI Fund Additional information regarding New Markets Ta x Credit Allocation Agr eement in the form of frequently asked Questions & Answers can be found at web site: http://www.cdfifund.gov/docs/nmtc/allocation_agreement_faq.pdf Appendix B provides a list of the qu estions in this docum ent. 5

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B. Community Development Financial Institutions The Community Development Fi nancial Instituti on (CDFI) Fund is a specialized financial institution th at works in market niches that are underserved by traditional financial institutions within the US Departm ent of Treasury. It plays a key role in the funding and oversight process. The CDFI Fund leverages private investment to benefit economically disadvantaged people and communities. It administers a competitive grant program that provides capital grants, loans, equity investments and awards to fund technical assistance to community development financial institutions. CDFI certification is a designati on conferred by The CDFI Fund that indicates that a financial institution, such as banks, credit unions, loan funds, venture capital funds, and m icroenterprise loan funds, provides financial products and serv ices in defined underserved and economically distressed target markets. The CDFI certification period is thr ee years from the date the Fund designates the CDFI. The use of a CDFI must include providing de velopm ent services that support financial transactions, and show that it is directly accountable to its comm unity or its customers. CDFIs provide a unique range of financ ial products and services, such as mortgage financing for lowincome and first-time homebuyers and not-for-pro fit developers, flexible underwriting and risk capital for needed community facilities, an d technical assistance, commercial loans and investments to small start-up or expa nding businesses in low-income areas. Additionally, CDFI certification is used as a requirem ent for accessing financial and technical assistance from the CDFI Fund through the CDFI Program and Native American CDFI Assistance (NACA) Programs to support an orga nizations established community development financing programs. A certified CDFI can al so partner with a FD IC-insured depository institution that seeks a Bank En terprise Award (BEA) from the Fund to support investments in the CDFI. CDFI certification may provide acces s to the New Markets Tax Credit Program by allowing the CDFI to become a Community Development Entity (CDE). CDFI certification may also enhance a financial institutions ability to raise funds from foundati ons and state and local governments. To apply to become certified as a CDFI an or ganization must subm it a CDFI Certification Application to the CDFI Fund for review. The a pplication must demonstr ate that the applicant meets each of the following requirements for the applicant to become certified: Be a legal e ntity at the time of certification application; Have a prim ary mission of promoting community development; Be a financing entity; Primarily serve one or more target markets; Provide developm ent services in conjunc tion with its financing activities; Maintain accountability to its defined target m arket; and Be a non-governm ent entity and not be under co ntrol of any government entity (Tribal governments excluded). (Reference: http://www.cdfifund.gov/what _we_do/program s_id.asp?programID=9) 6

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The application CDFI application guidan ce and form can be found at web site: http://www.cdfifund.gov/docs/certification/ CDFI/CDFIcertificationApplication.pdf CDFIs structure include regulated institutions su ch as community deve lopment banks and credit unions, and non-regulated institutions such as loan funds, venture capital funds, and microenterprise loan funds. There were 748 Certified Community Development Financial Institutions as of March 1, 2006. The organizations are presented alphabetically by state and city at web site: http://www.cdfifund.go v/doc s/certification/cdf i/CDFI-state.pdf C. Double Bottom Line Investment Funds (DBLIF) These funds promote and fund what is sometimes called sm art growth activities. DBLIFs are capitalized to succeed, use private market discipli ne, and provide investors appreciate returns. They represent a combined effort from the private and public sector for the betterment of the both. o Private Eq uity of the private sector, that represents the upper quartile market returns for investors, and o Community Equity that provides measurable jo b, shelter and wealth creation. DBLFs focus their used to investments in: Mixed-use comm ercial, industrial and housing projects Affordable and m ixed-income housing Urban infill and brownfield cleanup Transit-or iented development Measurable job and wealth for community residents The funding sources for DBLIFs typical include: Community Developm ent Ventur e Capital Alliance (CDVCA) New Markets Venture Capital (NMVC) Bank Enterp rise Award Program (BEA) Small Business Administration (SBA) Qualified Target Industries (QTI) State of Florida There are four emerging model structur es of DBLIFs. These models are: Contractual o Regional private sector/comm unity Not-For-Profit (NFP) sponsors o Contracts with world class fund m anagers o Fund manager operates within contractual boundaries Low and m oderate income areas only No displace ment permitted Mixed-use and m ixed-income Measurable job and wealth benefits f or residents o Within these bounds, fund manager behind firewall o NFP sponsor receives .5% m anagement fee and 2% carry o Investors and NFP spons or can remove fund manager 7

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Ownership o NFP community sponsor owns for-profit fund m anager o NFP sponsor establishes policy for fund Low and m oderate income areas only No displace ment permitted Mixed-use and m ixed-income Measurable job and wealth benefits f or residents o Limited partners include world class institutional investors o For-profit fund m anager receives 3% management fee and 20% carry o NFP parent owns m anagement company and shares in management fee and carry Legislative o Community advocates negotiated for funds o Insurance industry trades DBLFs for tax reduction o Fund criteria and tax deal c odified in state legislation Low and m oderate income areas only Funds invested in CDC and affordable housing deals No displace ment permitted Mixed-use and m ixed-income Measurable job and wealth benefits f or residents o Insurance industry publicly repo rts: advocates post audit Fund Manager o Fund managers discover ROI and DBLF o Investors like returns, fund m angers, and DBL concept o Problem: who is monitoring second bottom line? o National m ovement in develop DBL standards D. Early Stage Gap Financing Early Stage Gap funding targets a specific phase in technology de velopment. It targets were there is often a lack of funding in the process, that being be tween proof of concept and product developm ent. This type of funding is used to target a specific phase in technology development. It targets were there is often a lack of funding in the process. It strives to fill this gap and provide the catalyst to complete and la unch new technology products and services. The best way to show how these funds are used is the technology developmen t and funding model. 8

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Sequential Model of development and funding The region corresponding to early-s tage technology developm ent is shaded in gray. The boxes at top indicate milestones in the de velopment of a science-based i nnovation. The arrows across the top of, and in between, the five stages represen ted in this sequential model are intended to suggest the many complex ways in which the st ages interrelate. Multiple exit options are available to technology entrepreneur s at different stages in this branching sequence of events. Early Stage Gap Financi ng is structured around: Technology developm ent and Funding model Angel Investors Universitie s Small Business Innovation Research (SBIR) program Small Business Technology Transfer (STTR) programs Advanced Technology P rograms (ATP) 9

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E. Summary Comparison of the models What they are How they are used How they are structured Community Development Entity (CDE) -have a primary mission o f serving, or providing investment capital for, LICs or Low-Income Persons, and -are accountable to resi dents of the LICs that they serve -Application made to Th eCDFI Fund -Administered by The CDFI Fu nd -intermediary vehicle for the p rovision of loans, investments or financial counseling in Low-Income Communities (LICs). -Only entity eligible to apply fo r NMTCs -domestic corporation or part nership -may be either nonprofit or for profit -LIC must be r epresented on the board Community Development Financial Institutions (CDFI) -leverages private i nvestment to benefit economically disadvantaged people and communities -application made to the CDFI Fu nd -competitive grant program (cap ital grants, loans, equity investments -awards to fund technical assistance mortgage financing for lowin come and first-time homebuyers and NFP developers, -flexible underwriting and risk cap ital -commercial loans and i nvestments to small start-up or expanding businesses in lowincome areas regulated institutions s uch as community development banks and credit unions, non-regulated in stitutions such as loan funds, venture capital funds, and microenterprise loan funds -directly accountable to its co mmunity or its customers Double Bottom Line Investment Funds (DBLIF) -represent combined equity effort from private and public sector -Funds sources are CDVC A, NMVC, BEA, SBA, QTI -Mixed-use commercial, in dustrial and housing projects -Affordable and mixed-income ho using -Urban infill and brownfield cleanup -Transit-oriented development -Measurable job and wealth for com munity residents -Contractual -Ownership -Legislative -Fund Manager Early Stage Gap Financing (EDGF) -funding targets tech nology development between proof of concept and product development -fill this gap and provide the catalyst to complete and launch new technology products and services -Technology devel opment and Funding model -Angel Investors -Universities -SBIR program -(STTR) programs -(ATP) 10

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5. New Market Tax Credit Opportunities and Demand. The section discusses recent information rela ting to NMTC Opportunities and De mand. It provides updates on the CDFI fifth round of the NMTC allocations and th e Senates failure to pass legislation to extent the NMTC progr am beyond 2007. Following this update is a good summary of NMTC opportunities as summarized by Clearinghouse NMTCs President and CEO, Douglas Bystry. A brief introduction to a va luable NMTC resource the NMTC Coalitions is provided. The last part of this section provided information rela tive to the demand for NMTC as illustrated in examples of communities th at have successfully utilized NMTCs. A. Current news from Washington on NMTC program WASHINGTON, D.C. September 1, 2006 A notice of allocation availability for the New Markets Tax Credit (NMTC) program will be pu blished December 1, 2006, according to the Community Development Financial Institutions (C DFI) Fund web site. Applications for the fifth round of NMTC allocations will be due by February 28, 2007 and the CDFI Fund expects to announce awards in Fall 2007. WASHINGTON, D.C. August 7, 2006 The Senate last week faile d to pass legislation that would have extended the new m arkets tax cred it beyond its 2007 sunset. The bill (H.R. 5970), referred to as the 'Trifecta' bill because it includ ed permanent estate tax relief, tax extenders and increasing the minimum wage, failed on a 56-42 vot e. Supporters of the provisions included in the measure have expressed hope that they could be passed yet this year after Congress returns from recess. The extension of the new markets tax credit will be discussed by industr y experts at N ovogradac & Company LLPs New Markets Tax Credit In vestors Conference October 24-26, 2006 in Boston, Mass. Reference. http://www.novoco.com/NMTC/index.shtml B. Clearinghouse NMYC Inve stment Opportunities HOW YOUR INVESTMENT WILL IMPACT THE LOWINCOME COMMUNITY JOB CREATION: The Clearinghouse NMTC will fund lo ans that will create jobs for residents of low-income communities, as well as individuals w ith low-income, in the eligible census tracts where loans are approved. Construction jobs: New projec ts or rehabilitation projects will likely benefit som e of the residents of the low-income communities. Manufacturing jobs: This is an im portant sector of jobs for revitalizing local economies and creating projects, such as, f actories, manufacturing plants, machine shops, etc. Retail jobs will also be cr eated for shopping centers, strip centers, nurseries, and other similar type of uses. INCREASED WAGES/ INCOME: The Clearin ghouse NMTC will increase household income for residents of low-income communities, as well as individuals with low-income, in the eligible census tracts where the loans are approved. Add itional higher paying jobs will be created as a result of the economic injection in certain areas and neighborhoods. 11

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Jobs For Unemployed Residents: In creased commercial development and revitalization will be recognized as part of the benefit. Cost Effective Services: Closer, more competitive, retail and service related jobs would benefit the low-income consumer a nd effectively same them money thereby increasing their family income. Money saved in gas or transporta tion costs associated with not driving out of neighborhoo d to go to a grocery store. UNEMPLOYMENT IMPACT: The loans financed by the Clearinghous e NMTC will have am immediate impact in areas of high unemployment b ecause of the new jobs created. The lack of good jobs is the #1 impediment to solving chr onic unemployment in low-income areas. BUSINESS RETENTION: The Clearinghouse NM TC will fund loans th at are designed to keep businesses in low-income neighborhoods. Expansion Loans will allow a successful business in the neighbor to expand and stay as opposed to leaving when things get good. Owner equity requirements are one of the tools used by the C learinghouse CDFI and the Clearinghouse NMTC that makes sure the business ow ner has a vested intere st in staying and not walking away from a business that may encounter hard times. Prepayment Penalties, which will be substantial over the life of the loans, will provide another financial incentive for business owners to remain in the community. These unique provisions planned by the Clearin g house NMTC will are something that all good lenders should do but often do not. Hard-money lenders or predatory lenders are not committed to the long-term vitality of the neighborhood. They may make a loan knowing that a borrower will not have the ability to pay b ack the loan over the long run. They are simply interested in loan fees and getting the colla teral back. The Clearinghouse NM TC would never make a loan knowing that the borrower would fa il. We would work with that borrower and assist them in strengthening their situation. RESIDENT/ WOMEN/ MINORITY OWNED BUSI NESSES: The Clearinghouse CDFI has a strong track record of lending to women and m i nority owned businesses as well as businesses owned by low-income residents. Of all businesse s we have loaned to, 40% were black owned, 40% were to women owned business, 10% to Hi spanic owned borrowers, and 10% to disabled business owners. Start Up Businesses: Home based businesses or tr uly entr epreneurial in activity will be eligible for consideration and encouraged to apply. Ma ny minorities and women are anxious to start their own businesses, only they lack the capit al to get the endeavor off the ground. The Clearinghouse CDFI recently made a loan to a wo man owned business that distributes and sells a homemade, one of kind dolls. It requires that a lender look beyond traditional c onventional underwritin g and analysis to have such a strong track record of lending to such a diverse group of applicants. CDFIs or CDEs are likely to have strong records of this type of lending, but many other SBA programs may have similar statistical data. 12

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CHILDCARE/ HEALTHCARE/ E DUCATIONAL SERVICES: Th e Clearinghouse CDFI is regarded as being one of the pr emier community development lende rs in Southern California. We have earned that reputation by funding a total of over $10 million in community development loans over the past four years. 79% of those went toward childcare facilities, healthcare clinics or e ducational services. Childcare loans: The Cl earinghouse CDFI has funded in several different neighborhoods in our service area. T o date we have funded a total of 12 loans. One loan was for a childcare cente r that created over 250 childcare slots and restored a vacant boarded-up historic building. It is anticipated that the Clearinghouse NMTC will continue to fund many of these types of loans. Healthcare loans: The C learinghouse CDFI has made a total of 7 Healthcare related loans. One loan was to help a Spanish speaking dental clinic located in a lowincome neighborhood stay in business, since his original note had come due and the existing lender refused to extend furt her credit, even though the business was profitable. The CDFI made th e loan at a lower interest rate and the business is doing better than ever. Educational Services Loan s: Several educational loans have been approved to organizations that focus on provi ding educational services to low-income communities. In addition to several child care / pre-schools, we have approved a charter school, and to a trai ning program for emancipated fo ster youth. One loan was to a non-profit that brings books and educati onal material to the lowest-income school districts throughout th e United States. WEALTH CREATION/ ASSET ACCUMULATION: The Clearinghou se NMTC will make loans that will contribute to wealth creation a nd asset accumulation through a number of ways. Commercial Acquisition Loans: The Clearinghouse CDFI has made a number of loans that have allowed businesses that were currently renting their facilities to purchase them. Often these lo ans have had mortgage payments less than what the business owner was paying on rent. Home Ownership Loans: The Cl earinghouse CDFI, through our non-profit community partner, Affordable Housing Cl earinghouse, offers home loans to first time buyers in low-income census tracts. They successfully have facilitated the lending of over $40 million in these loans. The Clearinghouse CDFI is also approved by Freddie Mac as a lender in their lease to purchase program that allows families to get into home ownership in spite of credit problems and with only a 1% down payment. While the Clearinghouse NMTC will not be offering loans for home ownership, we anticipate that we can offer our home ownership loans in additional areas and in a more directed approa ch to longer-term wealth creation. TAX BASE EXPANSION: Clearinghouse NMTC lo ans will have a defin ite positive impact on increasing the tax base of the municipalities wh ere we expect to lend. Property tax revenue will increase do to the increase in valuation based on development of undeveloped land or improvement on existing buildings. Sales tax revenue will increase substantially in ar eas where new commercial centers are being proposed. 13

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Reference: A COMMUNITY DEVELOPM ENT INVESTMENT WITH A MARKET RATE RETURN, dbystry@clearinghousecdfi.com To obtain an investment prospectus and offering, please contact: Douglas J. Bystry, President and CEO, Toll Free: 800-445-2142 Phone: 949859-3600 http://www.clearinghousenmtc.com/index.c fm?fuseaction=browse&id=4858&pageid=32 C. NMTC Resources Introduction to the NMTC Coalition The New Markets Tax Credit (NMTC) Coalition was founded in 1998 by a group of local, regional and national community developm ent organi zations that came together to advocate for a federal tax credit that would encourage private investment in community development. The goal was to create a federal tax credit that coul d do for community development what the Low Income Housing Tax Credit had done for housing. The Coalition worked with the Clinton Administra tion and a bipartisan coal ition with in the 107th Congress to see the New Markets Tax Credit authorized as part of the Community Renewal Act of 2000. Since the NMTC became law, the Coalition has worked clos ely with the Bush Administration and Treasury Department offici als to launch the program and to develop implementation regulations and procedures. With its growing membership of more than 100 organizations, the Coaliti on has established itself as the principal policy voice advocating for the NMTC. Working with N MTC champions in Congress, the Coalition has la unched a legislative campaign ai med at extending the NMTC to 2012. The Coalition is actively working to engage CDEs, investors, public officials and other NMTC supporters in this reauthorization campaign. Reference: For additional information on the NMTC reauthorization effort and how you can help. http://www.newmarke ts taxcreditcoali tion.org/News/news.frameset.htm D. Examples of other Bioscience CDE activity in other communities Minnesotas Biobusiness ST. LOUIS PARK, Minn. (May 10, 2006) While Minnesota is hom e to a broad array of biobusiness technology enterprises at least 425 entities, the st ates strength in biobusiness slipped in comparison to key competitor states according to the BioBusiness Alliance of Minnesota. Minnesota lost ground in biobusiness empl oym ent from 1997, which was a time when other states targeting bioscience added high-pa ying jobs in this i ndustry, stated Dale Wahlstrom, chairman, BioBusiness Alliance of Minnesota. During this time, Minnesota saw a decline in biobusiness employment and struggle d to develop start-up companies, he said. Biobusiness includes enterprises in biotech, agri -bio, bio-industrial, medical, pharmaceuticals, diagnostic and life sciences R&D. 14

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The BioBusiness Alliance of Minnesota commissioned a series of research studies aimed at understanding the econom ic well-being of the states biobusiness t echnology sector. The research studies drew their findings from data collected by the U.S. Census Bureau and a firstever grass roots survey of Minne sotas biobusiness technology ente rprises. The research findings will be presented in a forthcoming white paper. An area of concern identified in the study is within a key sub sector m edical device technology, said Wahlstrom. The competitiveness study confirmed Minnesota is a major player in medical device technology, however, the state lost ground in total medical device employment and new business generation from 1997. There is good news as well. Since 2002, the date of the most recent federal economic census, Minnesota job losses in biobusiness have stoppe d. It appears no other state added as m any medical device jobs as Minnesota and in fact the biobusiness industry has added upwards of 4,000 jobs, according to the Minnesota Department of Employment and Economic Development. In the past three years, employ m ent in Minnesotas biobusiness sector has grown, according to Kelvin Willoughby, Honeywell-W. R. Sweatt Chai r in the Management of Technology at the University of Minnesota and author of one of the studies. However, we cannot be sure exactly how our recent job growth compares to that of key competitor states, because the federal economic census will not be updated until 2008; it is important to remember that key competitor states are also adding jobs th roughout the bioscience industry. The BioBusiness Alliance receiv ed strong support from the Gove rnor, legislative, industry and academic leaders in completing this statewid e assessment. The BioBusiness Alliance will continue to collaborate with business, governme nt and academic leaders to identify ways to strategically target and grow this vital sector of our economy, said Wahlstrom. Recent studies of the U.S. bioscience sector reve aled that nationally the sector is growing. Biobusiness provides good jobs they pay $26,000 more than the aver age private sector job. U.S. biobusiness, including the health and agricultural markets, are strong, gr owing and the businesses are profitable, Wahlstrom said. Minnesota remains a leader in certain biobusiness sub sectors. The 1997 trends identified in the studies m ust not only be turned around, bu t growth must be accelerated in order for Minnesota to remain competitive, Wahlstrom said. Jobs created by Minnesota companies and academic institutions working in the human health and agri-bio sub sectors are being targeted by other states and countries. We need to protect Minnesota jobs, he said. The BioBusiness Alliance of Minnesota is an action-based, 501(c)(3) not -for-profit o rganization of biobusiness executives from the academic, public and private sectors. The charter of the BioBusiness Alliance is to bring together all related areas of the biosciences in a coordinated effort to ensure the long-term health a nd success of Minnesotas bioscience industry. Reference. Minnesotas Biobusiness Strength is Threatened, Recent Data Suggest Turnaround, May 10, 2006 15

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BioBusiness Alliance of Minnesotas Frequently Asked Questions May 2006 Q. What is the BioBusiness Allia nce of Minnes ota releasing today? A. The BioBusiness Alliance of Minnesota announced the findings today from a series of comm issioned research studies that assessed the economic well-b eing of Minnesotas bioscience sector. Q. What was the scope of the commissioned research? A. The BioBusiness Alliance of Minnesota commissioned research to: generate an inventory and census of the stat es biobusiness technology enterprises (BTEs); survey Minnesotas BTEs to gain insights into the ir capabilities specifically focused on their technologies, products and markets; and assess Minnesotas competitiveness in the biobusiness sector with 10 other states. Q. What is a biobusiness technology enterprise (BTE)? A. A BTE is an entity devoted to the developm ent and/or comm ercialization of bioscience or bioscience-related technologies, products or services. A BTE c ould be a for-profit business, a not-for-profit entity or an academic institution. Q. What were the findings of the BioBusiness Alliance s first statewide, grass-roots census of Minnesotas biobusiness sector? A. The census showed that Minnesota has at le ast 425 biobusiness technol ogy enterprises located throughout the state. Q. Is Minnesota a leader in any specific sub sector of biobusiness? A. The vast majority of Minnesotas BTEs are in the hum an health sub sector. Of the 425 BTEs identified in the census, 252 BTEs are based in human health, 120 BTEs are based in agribio/bio-industrial, and 7 BTEs are based in biotechnology/bios cience. The remaining 46 BTEs are based in cross-over areas which include more than one of the above categories. Q. What were the findings of the BioBusin ess Alliances survey of Minnesota BTEs? A. The survey showed the states top market s are cardiology, research, and oncology and the states top products are surgical devices, delivery system s, and dr ugs. The survey also revealed that the technological breadth of Minnesotas biobusiness sector is substantial. Q: What were the findings of the competitiveness study? A. Minnesotas competitiveness in the biobusiness sector was co m pared with 10 other states. The study found that Minnesota is average on most key econom ic indicators; however, the state lost jobs in the biobusiness sector betwee n1997-2002. Job losses in Minnesotas biobusiness industries have stopped and recent data on bi obusiness employment from 2002-2005 suggest a turnaround. 16

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Q. Why did Minnesotas competitiveness in biobusiness erode from 1997-2002? A. We do not know why the states competitive p osition eroded. The BioBusiness Alliance of Minnesotas studies were designe d to assess the economic-well be ing of the biobusiness sector. The studies confirmed that Minn esotas biobusiness sector remain s competitive and a leader in the medical device technology sub sector, even though the industry lost jobs during the study period of 1997-2002. Q. When can I view the BioBusiness Alliances statewide assessment? A. The statewide assessment is a collection of commissioned research studies. The BioBusiness Allianc e of Minnesota will issue a White Pape r in the coming weeks that summarizes the findings of the commissioned studies and sets forward an action plan, including the groups 20year economic growth initia tive called Destination 2025. Q. What is Destination 2025? A. Destination 2025 is a collaborative initia tive to ensure the long-term growth and competitiveness of the states biobusiness sector. The project will tap the biobusiness expertise in Minnesotas business sector, academic sector and research institutions. Q. What is the BioBusiness Alliance of Minnesota and who are its members? A. The BioBusiness Alliance of Minnesota is an action-based, 501( c)(3) not-for profit organization of biobusiness executives from the acad emic, public and private sectors. The charter of the BioBusiness Alliance is to bring together all related areas of the biosciences in a coordinated effort to ensure the long-term hea lth and success of Minnesota s bioscience industry. Posted on 05/10/2006 BioBusiness Alliance of Minnesotas Statewide Assessment Findings, Frequently Asked Questions May 2006 http://biobusinessallianc e.org/news-articles/m innesotas-biobus iness-strength-is-threatened, Source web site http://www.bioenterprise.com/news/index.html#top Phoenix Phoenix has been awarded $170 million in New Markets Tax Credits (NMTC) to stimulate priva te sector investment in the economic development of low-income communities, city officials said Friday. The program was se t up through the Community Development Financial Institutions Fund of the U.S. Department of the Treasury, according to the announcement. Congress passed legislation for this program un der the Community Renewal Tax Relief Act of 2000 that provides a 39 percent tax credit for qua lified equity investment over a seven-year period. Phoenix and 65 other agencies were selected to receive NMT Cs totaling $2.5 billion for the 2002 fund year. Applicants who demonstrated the strongest business and capitalization strategy, management capacity and community impact got the credits, according to city officials. The NMTC program received 345 applications reques ting nearly $26 billion in allocations for 2002. Only $2.5 billion was available for distribution in 2002 with $15 billion available throughout the life of the program, which ends in 2007. 17

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The city of Phoenix sponsored the application for NMTC by creating a nonprofit agency, Phoenix Community Developm ent and Investment Corp. (PCDIC), to apply. The PCDIC board of directors has representation from the cit y, Chicanos Por La Causa, Phoenix Community Alliance and the Urban League, all of which provi de services to individuals and businesses in low-income communities. The Community a nd Economic Development Department partnered with the Finance, Neighborhood Services, Housi ng and Equal Opportunity departments to apply for the tax credit allocations, city officials said. The mission of the Phoenix program is to attract a nd provide funds for qualif ied projects that will improve the quality of life of those individuals who live and work in underserved areas of the community. The initial focus will be in four areas: business development and revitalization, biosciences, small business finance program s and venture capital officials said. Reference. Phoenix given $170M in tax credits The Business Journal of Phoenix March 14, 2003. For more information, call L ynda Dodd at 602-261-8708, or visit the city of Phoenix Web site at http://www.phoenix.gov. bizjournals.com /phoenix/stories/ 2003/03/10/daily62.html?t=printable Baltimore Placing a high priority on the biosciences as a measure for long-term economic development, the Baltim ore Workforce Investment Board (BWIB) has released a strategic plan that aims to ensure growth, in part, by securing a highly motivated and well trained workforce for the city's bioscience sector. Conducted by two consulting firms, the Baltimore Bi oscien ce Initiative finds that the city and surrounding region already have a sizable employ ment base of approximately 11,000 people. The majority of this workforce is housed at university medical sc hools and hospitals and National Institutes of Health (N IH) laboratories, the report st ates. Of the 78 companies (4,800 employees) that make up the bioscience sector, however, 12-15 percent of their workforce is comprised of low-skill workers, such as lab as sistants, technicians, production technicians and clinical technicians. In preparing the plan, the consultants studied econom ic and demographic trend information in the Baltimore area and conducted interviews with human resources directors of major employers and directors of major educati on and training providers. The cons ultants also reviewed best practices for similar training initiatives and visi ted two areas with reputable programs, Berkeley, CA, and Spokane, WA. The Baltimore Bioscien ce Coalition, a group of stakeholders, subsequently was formed to a ssist in developing the plan. The outlook for the biosciences in Baltimore is ve ry prom ising, according to the plan. Continued growth of the area's nonprofit sector, rapi d increases in NIH funding, and emerging young biotech companies from R&D firms are all positive signs. Plans also are in the works for an R&D park near Johns Hopkins Medical School and development around the University of Maryland medical campus, and some construction of the 600,000 sq. ft. of lab and office space 18

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planned for these facilities already is underway. The researchers estimate cumulative growth will increase 25 percent by 2 005 and 40 percent by 2007. What is lacking in the effort to bolster this growth, the report sugge sts, are "m ore vigorous technology commercialization efforts from the resear ch-rich base, better en trepreneurial support services, greater access to investment capital, larger stock of laborat ory space and a stronger leadership base in the bioscience community." The report adds that small biotech companies "simply do not have the resources or the need for technician level workers." Baltimore should model the efforts in Berkeley a nd Spokane, the res earchers say. The projects in those locations reveal several applicable lessons: initiatives and programs must be employerdriven; programs must reflect sh ifts in technology and markets; and healthy relationships among employers, educational institutions and other area players must be present. A new nonprofit corporation called BHR2 (Bio Human Resource 2), created as part of the consultants' sectoral employment plan for Baltim ore, would help facilitate the above lessons. BHR2 would act as an extensi on of bio employers' human res ource departments, serving to recruit and retain qualified candidates, and would work with a Baltimore Bio HR Network to be supervised by the Maryland Bioscience Alliance. The report also recommends establishing a Bio Pilo t Program that would c onsist of a biosciences leadership steering group, a similar HR network as that of BHR2, and a coordinated program for employment and training services. The city could apply for a $100,000 Department of Labor (DOL) grant and use $180,000 in existing training f unds to get the pilot program started. For the entire strategic plan, the researchers say implem enting the training portion will require five to 10 years. BWIB was created in September 2000 following legi slation under the W orkforce Investment Act to form such boards. Funding for the Baltimore Bi oscience Initiative, as well as the blueprint for the Bio Pilot Program, came from a DOL planning grant. Reference. Both reports are available at http ://w ww.baltoworkforce.com. Bioscience Initiative Pushes for Jobs in Baltimore Kentucky Sixty-nine percent of Kentucky businesses use com puter technology to handle some of their business functions, but only 36 percent use the Internet and little more than 20 percent have a website, according to a report released by Governor Paul Patton's Office for the New Economy. Kentucky Prepares for the Networ ked World, which details computer, Internet and website use among the state's businesses, shows more than 50 percent see "no need" to use the Internet. The report is part of the governor's connectkentucky strategic plan that is designed to give Kentucky a sophisticated inform ation network. It was commissioned by a steering committee to respond to the governor's request to assess the condition of the Kentucky's Internet highways, 19

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high-speed on-ramps to the highw ays and current use of the Internet by business, government and consumers. Overall, the state is on par with national averages in business use of com puter technology and the Internet, yet significant regional di fferences remain, the report states. The survey results show more than 60 percent of Kentucky's city a nd county governments do not have a website. In addition, of those that do have a website, the va st majority provide only basic information, not the e-government services that keep citizens from having to visit the local court house or city hall. Several strategic goals are outlined in the report: Increase public awareness of the benef its of e-comm erce, e-government and elearning to Kentucky's businesses, gove rnmental agencies and citizens; Create and implem ent market driven strategi es that increase business, consumer and government use of the Internet; and, Implement public policy initiatives that pr omote competition and eliminate regulatory barriers to increase Intern et usage and enhance broadband deployment throughout Kentucky. Each goal also has success measures that ou tlin e how the connectkentucky Steering Committee will measure their progress in the future. Kentucky Prepares for the Networ ked W orld contains some helpfu l maps showing the degree of Internet access in all of the state's 120 coun ties. The report is available at Reference: http://www.connectkentucky.org, connectkentucky Plan Prepares State for Tech-driven Economy. Great reference print only could not copy to word doc. NMTC Monthly Report, June 2003, Evaluating NMTC Opportunities for Sm aller Development Organizations and CDFIs, WWW.newmarketscredits.com http://www.novoco.com/NMTC/Article_of_m ont h/NMTC_article_of_month_0603.pdf#search=' NMTC%20opportunities' Virginia Various community development organizations th roughout Virginia will organize and becom e members of Virginia New Markets Fund, LLC ( VNMF), a joint venture formed to manage Virginia new markets tax credit (NMTC) tran sactions. VNMF will apply for an allocation of NMTCs, receive management fees and possibly a percentage of profits for its management services, establish transa ction terms and provide deal flow to the subordinate funds. A board of managers composed of representatives from the various organizations will govern VNMF. NMTC investors will invest dire ctly into one or more funds managed by VNMF and certified as community development entities (CDE). VNMF-managed funds will seek to provide investors with the benefits of other economic incentives su ch as historic rehab ilitation tax credits and enterprise zone incentives. 20

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The Virginia Small Business Loan Fund will provide loans to small businesses and community development entities throughout Virginia. The Virginia Real Estate Fund will focus on business development and commercial development by providing loans and investments for acquisition, construction and rehabilitation of real estate projects, including, where appropriate, mixed use developments and housing developments. This fund will also invest in CDEs focused on real estate development and investments. The Virginia Venture Capital Fund will provide equity investments to seed and early stage QALICBs for operating expenses and equipment. The Virginia Business Services Fund will provide financial counsel ing and other services to Virginia community organizations, small businesse s and residents in low-income communities. Proposed terms for Virginia New Markets Fund, LLC (VNMF): A. Purpose/scope: VNMF will operate for the purpose of applying for New Markets Tax Credits (NMTC) and bringing the se credits to third partie s as an incentive to make investments in businesses and real estate pr ojects located in low-income communities. VNMF will facilitate NMTC investments thr ough its management of four funds: a small business fund, a venture capital fund, a real estate fund, and a fund expected to provide financial counseling and other services. In addition, VNMF will administer and monitor investments to ensure that all investment s comply with the NMTC program during the seven-year tax credit period. B. Capitalization: Each community developm ent entity se eking to participate in and possibly source deals through VNMF will make a capital contribution to VNMF of at least $_______ per membership unit. VNMF will raise a minimum of $______ through investments from member community deve lopment entities to at least cover organizational expenses. The members will be required to make additional capital contributions to VNMF in the following instances:________. C. Management and voting rights: The members will elect a board of managers made up of at least __ but no more than __ representatives. The board of managers will elect the officers and select the investment advisor(s) for the VNMF-managed entities. D. Competition: Each member will agree th at V NMF will be the sole entity through which said member pursues NMTC opportunities without the prior written consent of the other members. Reference: Proposed Model for Vi rginia New Markets Tax Credit Fund http://www.rich.frb.org/community_affairs/new_ m arkets_tax_credits/pdfs/bullardmodel.pdf#sea rch='NMTC%20opportunities', Minneapolis MINNEAPOLIS March 8, 2004 Community Re investm ent Fund (CRF) today announced that it has closed its first New Markets Tax Cr edits (NMTC) investment between Bear Stearns and Commercial Lending, Inc. The deal, totaling $82.5 million, is potentially the largest to date 21

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within the New Markets Tax Credit system and en sures CRFs eligibility for the second round of NMTC allocations, schedule to be announced this spring. In March of 2003, CRF was awar ded $162.5 m illion in NMTC, receiving the largest allocation of any national organization. However, in orde r to be eligible in 2004, the organization was required to have received cash from its inve stors for 50 percent of its qualified equity investments by March 5, 2003. By making the investment now, B ear Stearns has kept CRF in th e ring to com pete for a second round of New Markets Tax Credits, said Fra nk Altman, president and founder of CRF and charter member of the NMTC Coalition Steering Committee. This marks a major milestone for CRF on its New Markets journey." The NMTC, a program aimed at stimulating privat e inve stment in low-income communities, is a first of its kind tax credit to investors who make qualified equity investments in privately managed investment vehicles. By making an eq uity investment in an eligible community development entity (CDE), invest ors can receive tax credits wort h more than 30 percent of the amount invested. In March of 2003, the Treas ury Departments Community Development Financial Institutions (CDFI) Fund distributed $2 .5 billion in credits to (how many?) CDEs across the nation. CRFs wholly-owned for-profi t subsidiary, National New Markets Tax Credit Fund Inc, was awarded the second largest allocation, the highest amount made to an organization with national reach. As a purchaser of economic development loans, CRF, a non-profit organization, is able to take advantage of the NMTC program and make it even more attractive to investors. The organization takes on the administrative burdens that lender s otherwise would have to handle, such as establishing a for-profit entity, appl ying for tax credits, finding inve stors, reporting the use of the credits and loans to investors and more. Bear, Stearns & Co. Inc. is a l eading global investm ent banking, s ecurities trading and brokerage firm. Through Bear, Stearns Secu rities Corp., a wholly owned subsidiary of The Bear Stearns Companies Inc., the firm processes approximately 8% of the New York Stock Exchange volume cleared daily through the National Securities Clearing Corp. We ar e also widely recognized as the largest borrower of U.S. equities, and for over a decade have averaged nearly 20% of the reported NYSE short interest. Bear Stearns had to tal capital of $37.5 billion (as of November 30, 2003) and total assets of $209.7 billion (as of August 31, 2003). According to the April 2003 issue of Institutional Investor magazine, Bear St earns is the seventh largest securities firm in terms of total capital. Community Reinvestment Fund (CRF), a Minne apolis-based non-profit organization, is the nations leader in bringing capital to public and private, nonprofit community development lenders through the secondary market for loans. Formed in 1988, CRF has injected hundreds of millions of dollars into low-income and economically disadvantaged communities around the country to help stimulate job creation and ec onomic development, provide affordable housing and support community facilities. 22

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Reference: 3/08/04 CRF Finalizes First NM TC Investment, Community Reinvestment Fund Finalizes First New Markets Tax Credits In vestment, $82.5 MillionT ransaction to Aid Communities Across the U.S. http://www.crfusa.com/info.asp?sectionID=59&subsectionID=59&articleID=151 23

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6. Examples of community-initiate d development High Technology Bioscience models. Examples presented in the paper include: a) Virginia's Center for Innovative Technology (CIT) b) Durham Research Triangle Park-bas ed nonprofit Biotechnology Center c) Cleveland BioEnterprise d) Oxford Bioscience Partners (OBP) e) Portland Bioscience Innovation Funds f) Pittsburg Life Sciences Greenhouse LifeSPAN g) Rocky Hill, Connecticut Innovations (CI) Biotech Seed Fund h) Kansas Technology Enterprise Corporation (KTEC) i) Phoenix Community Development & Investment Corp. (PCDIC), New Market Program A. Virginia's Center for Innovative Technology (CIT) Program Recognizing the role that private equity invest m ent plays in the initia tion and growth of highgrowth technology enterprises, Works with hundreds of regional technology comp anies to assist them in identifying federal R&D funding opportunities appropriate to their growth objectives Through a series of educational events, proposal developm ent support offerings, and hands-on consultative activities, CIT enhances their chances of winning federal grants and commercializing resulting technologies. CIT's Capital Access Program nurtures the growth of technology companies through early-stage financial investment. The Growth Acceleration Program is to help close Virginia's "funding gap" for pre-seed and seed stage technology companies. Assistance Program identifies and acceler ates opportunities for Virginia's small technology businesses to obtain SBIR, STTR and ATP awards and other government contracts. Reference: http://www.innovationave.com/cap_program.asp, Contact Joseph S. Svetina, NASA In novative Partnerships Director, Phone: 757-249-0884 Fax: 757-249-0738 jsvetina@cit.org B. Durham, N.C., Research Triangle Pa rk-based nonprofit Biotechnology Center Mission is to provide long-term econom ic and societal benefits to the state through the support and growth of biotechnology re search, business and education Chose Eno River Capital to set up and m anage the Bi oscience Investment Fund NationsBan k invest up to $5 million in the fund (1984) Biotechnology Center' s staff of 60 professionals Highlights: o $16 million in financial assistance to 92 early stage biotechnology companies 24

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o Recruit, retain and expand biotechnology companies; Biogen Idec, Diosynth RTP, Merck and Co., Novozymes responsible for high-paying jobs. o $50 million in North Carolina universiti es to recruit 46 outstanding faculty, purchase multi-user research equipment, and sponsor 450 research projects. o For every $1 invested in research projects by the Biotechnology Center, the universities have gained a bout $14 in federal grants. o Preparing 1, 100 teachers in North Ca rolina to teach about biotechnology. o Tripling enrollm ent in the biosciences at the state's six historically minority universities by granting $8 million in special appropriations Reference: http://www.ncbiotech.org/ 15 T.W. Alexa nder Dr., Research Triangle Park, NC, 27709, 919541-9366 http://www.bizjournals.com/charlotte/stories/1998/04/06/daily5.html Charlotte Business Journal April 7, 1998 C. Cleveland, BioEnterprise (June 2, 2005) Business formation, recruitment, and acceleration initiative designed to grow health care com panies and commercialize bioscience technologies. Five-year partnership (2002) am ong Case Western Reserve Un iversity, Cleveland Clinic Foundation, University Hospitals Health System and Summa Health System, Received a grant from a collaboration of nearly 70 philanthropic foundations Provides Companies: o Experienced bioscience m anagement guidance. o Privileged r elationships with world-cla ss research and clinical institutions. o Access to bioscience venture ca pital and private equity firm s o Business developm ent and alliance support for strategic partnerships. o Network of regional bus iness capabilities Results since July 2002,: o 45 companies created, recruited, and accelerated o $200 million in new funding o $50 million in revenues o 150 technology transfer Reference: Denise Richardson, Manager, Business Developm ent, BioEnterprise Corporation 11000 Cedar Avenue, Suite 100, Cleveland, OH 44106. submissions@bioenterprise.com As an interesting note this proj ects fund raising efforts included taping the Florida sunshine. The nonprofits BioEnterprise Corp. and Jum pStart Inc. flew south in search of investment dollars. They organized a group of 25 angel in vestors who met in Naples, Fla., to hear presentations from four Cleveland-area companies in search of venture capital. Reference: Brandon Glenn, March 27, 2006, http://www.bioe nterprise.com/news/2005/05ffef.html 25

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D. Oxford Bioscience Partners (OBP) This is a Life Science venture capital firm that provides equity fi nancing and m anagement assistance to advanced-stage star t-ups and later-stage commercially oriented organizations. Its Objective is to generate long-te rm capital gains for both investors and entrepreneurs. This fund invests in businesses capable of improving the diagnosis and trea tment of disease, as well as companies with technologies that acceler ate drug discovery and development. Reference: http://www.oxbio.com/index.html For General Information: Kathleen Moeckel, Office Manager, 222 Berkeley St. Suite 1650, Boston, MA 02116, (617)357-7474, Fax: (617)357-7476, kmoeckel@oxbio.com E. Portland, Ore. Bioscience Innovation Funds This fund was founded in 2003 to help university investigators translate prom ising early-stage discoveries into marketable technologies. Th e Oregon Health & Science University (OHSU) awarded its first funds March 3, 2005. The project involves: Helping to f und OHSU researchers bridge the "valley of death" funding gap Includes five investigators that shared a total of more than $400,000 The goal of the fund is to help scientists overcom e the financing gap between discovery and initial commercial seed funding. Reference: http://www.ohsu.edu/ohsuedu/ne wspub/releases/030305biosciencehtm l.cfm, http://www.ohsu.edu/, Arundeep Pradhan, di rector of OHSU Technology and Research Collaboration, 3181 S.W. Sam Jackson Park Rd., Portland, Oregon 97239-3098, (503) 494-8311 F. Pittsburg, Life Scienc es Greenhouse LifeSPAN Innovation Works (IW) and Pittsburgh Life Sc iences Greenh ouse (PLSG) forms LifeSPAN Investor Forum. It is a network for angel i nvestors supporting early-sta ge life sciences. PLSG invests in and supports gr owth in the areas of: bioinform atics; bionanotechnology; diagnostics; medical devices; medical robotics; therapeutics; The projects objective includes: Employment creation, community developm ent, and elimination of urban blight The program: Provides Capital Involves People Makes Space 26

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Maintains Leading Edge Research Establishes Industry Connectivity Reference: http://www.pittsburghlifesciences.com/content.aspx?id=76041a52-ecb6-44c0-b3e506ad1aecbf62EW S RELEASE, C ontact: Terri Glueck, Innovation Works, 412-681-1520 x 435, Charlotte Rapkin, Pittsburgh Life Sciences Greenhouse, 412-201-7483, G. Rocky Hill, Connecticut Innovat ions (CI) Biotech Seed Fund The fund helps to catalyze th e developm ent of biotech comp anies through the crucial early stages. $5 Million for growth of Biotech Companies, (S eptember 25, 2001) States leading investor in high technology Created to accelerate the gr owth of early-stag e biotech enterprises in Connecticut Makes equity investm ents in emerging Connecticut technology companies Provides essential, non-f inancia l support to entrepreneurs Conducts initiatives that address sp ecific needs of technology sector. Support includes: o BioScience Facilities Fu nd finance th e expansion or creation of laboratory space; o Yankee Ingenuity Technology Com petiti on offers awards to Connecticut universities that collaborate with Connecticut businesses on applied research and development projects leading to marketable products and processes. Provides transitional laboratory spac e available to biotech start-ups. o Eli Whitney Fund both equity capi tal and guidance for high-technology companies Reference: http://www.ctinnovations.com/news/13.php, Connecticut Innovations President and Executive Director, Victor R. Budnick. Connecticut Innovations 200 Corpor ate Place, 3rd. Floor, Rocky Hill, CT 06067, Phone: 860-563-5851 Fax: 860-563-4877 H. Kansas Technology Enterprise Corporation (KTEC) This is a private/public partne rship established by the state of Kansas to prom ote technology based economic development. The project supports: Strategic research and developm en t at our Centers of Excellence, Intense hands-on business assist ance at our incub ators, and Equity investm ents in early-stage companies. The projects goal is to create ra pid growth com panies and higher paying jobs. The programs and affiliate organizations fall into three basic functional areas: Strategic Research and Developm ent/Centers of Excellence located at the state's universities, conduct basic and applied industry-led research KTEC's Intense Hands-on Business Assistance/Incubators priv ate/public partnerships designed to turn intellectual property and scienc e into businesses and products 27

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KTEC Investment Funds provides equity investment in early-stage technology companies and helps companies acquire the capital they need Reference: www.ktec.com/index_F lash,htm Tracy Taylor, President & CEO, (785) 296-5272, ttaylor@ktec.com KTEC, 214 S.W. 6th St. First Floor, Topeka, KS 66603, (785) 296-5272, Fax: (785) 296-1160, info@ktec.com Appendix C Kansas Legislator Briefing Book 2005. This docum ent includes legislated guidance for the fund. Reference: http://skyways.lib.ks.us/ksleg/KLRD/Publications /Briefs/G2BioscienceAuthority.pdf#search=' bi oscience%20funds I. Phoenix Community Development & Investment Corp. (PCDIC), New Market Program This program seeks to offer financing to bus ines ses that meet the qualifying criteria and demonstrate how PCDIC's financing will improve the economic conditions in the low-income community (LIC) in which they operate. Par ticipants in Phoenixs program must conduct business and provide services in an eligible census tract that meets community impact standards. Phoenix Community Development and Investment Corporations five-member Board has majority representation from leaders in Phoenixs under-served communities. Reference: http://www.phoenixnewmarkets.org/links.html Lynda Dodd 602-261-8708 or write to Phoenix Community Development and Investment Corporation, c/o City of Phoenix, Community and Economic Developm ent Depa rtment, 200 West Wash ington 20th Floor, Phoenix, AZ 85003 Phone: 602-262-5040, Fax: 602-495-5097 Appendix D Phoenix Community Developm ent and Investment Corporation Lending Guidelines for Bioscience or Technology Industries Effective, Date: PCDIC Board approved March 30, 2005. 28

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7. The Hillsborough Co unty initiated de velopment project High-tech Bioscience model. A. Matrix of possible structure combinations The table below lists a sample of the various struct ure s elections that can be used. It is divided into four major categories; Management, Business, Capitalization, Community Impact. These category are the same as used by The CDFI F und for a CDE to apply for the New Market Tax Credit Program. This represent the basic evalua tion categories used to scope applicants. They lend themselves very well to this analysis. Matrix of possible structure combinations Management Business Capitalization Community Impact For-profit Non-Profit Corporation Partnership Contractual Ownership Legislative Fund Manager Subsidiaries Biodefense Biosensors Nanotechnologies Bioinformatics Behavioral research Biology Cell and Gene Therapy Biosilicon devices Biocompatible Mats Acousto-optics Opto-electronics Imaging Technologies Genetically engineered proteins Proteomics Genomics Complementary & Alt. Medicine (CAM) Pharmaceuticals Specialized Training Research Cancer, Surgical techniques, Aging, Heart disease Robotics Prosthesis Spinal Cord Injury NMTC DBLF CDVCA NMVC BEA SBA QTI CITVC SBA ESGF Private Funds Early Stage Gap SBIR STTR ATP SSBIC SBIC Universities Angel Investors In-kind Trade Create jobs Maintain Jobs Increase Wages Increase Income Finance LIC Business Assist LIC Business Facilitate Wealth Creation Facilitate Asset Accum ulation 29

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B. Vision of The Hillsborough County In itiated Development Project High-tech Bioscience model The below table postulates theoretically which types of Managem ent, Business, Capitalization and Community Impact structure com ponents might be targeted for the Hillsborough County initiated development project High-tech Bioscience project. Management Business Capitalization Community Impact -Non-Profit with ForProfit Subsidiaries -Corporation -Ownership -Biodefense -Biosensors -Pharmaceuticals -Specialized Training -Research Cancer, Surgical techniques, Aging, Heart disease -DBLF -CDVCA -NMVC -QTI -Private Funds -SBIR -Universities -Angel Investors -In-kind Trade Create jobs Maintain Jobs Increase Wages C. Project evolution of The Hillsborough County initia ted development project Hightech Bioscience This Projects evolution might follow a path as sugge sted below. The process is expected to take a num ber of years before it r eaches maturity and has a full force impact on the community. 1. Formulate state-up project team 2. Define project 3. Obtain seed money to proceed 4. Select loca tion (Best EZ fit for defined project) 5. Formulate vision of project 6. Establish m ilestones 7. Formulate Management / Oversight Capacity Objectives 8. Formulate Community Development Entity 9. Formulate capital/funding/investment strategy 10. Create Business Plan 11. Solicited funds and resources 12. Implement business plan 13. Promote opportunities 14. Expand partnerships 15. Make award s 16. Measure results & m ake adjustments 30

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D. Business Plan outline Filling the details behind the project evolution helps the project to take sh ape and can serve an abbreviated business plan. 1. State-up pro ject team a. County chairperson i. Role management oversight, business plan, funds, tax incentives, transportation b. City vice chair person i. Role funds, property, tax incentives, land, support infrastructure (fire, police, rec reation) c. USF i. Role funds, facilities, labs & eq uipm ent, research, faculty support, training, d. Community repres entatives i. Role identify community im pact needs, location, workers, housing, e. Business i. Role identify resources needs, f. Professional advisors i. Role Legal, Financing, Accoun ting, Real Estate, Construction, Consulting 2. Project a. Scope Bioscience with em phasis on re search & testing of new products and procedures. Target: i. pharmaceuticals and treatments of cancer aging, aging related ailments ii. all and any DoD Bioscience relate d needs with emphasis on SOCOM, FEMA and Home Land Security b. Project Name Hillsborough Count y Bioscience Initiative (H CBI) c. Objectives i. Improve economy of USF EZ (jobs/j ob creation, incomes, skilled labor, minorities, local business) ii. Become national leader in targ eted activity (pharmaceuticals and treatments of cancer, aging, aging related ailments and all and any DoD Bioscience related needs d. Prospective business players roles & responsibilities Existing national sm all/medium/large business with current interest, local/state businesses, roles based on economic impact/size/local/facility & labor skill needs e. Professional assistant needs Funds Ma nager consultants, Legal, Financing, Accounting, Real Estate, Construction, Consulting, Economic impact analysis, f. Resource needs Office space at USF, staff of 10 with Direc tor, Finance, Procurement, Marketing/Promotions, F unds solicitors, Business recruiters, Administrative g. Legislative needs Estab lish governing board repres entation (voting & nonvoting), em powerments, funding authority, qualification requirements, approval process, prohibited activities, regula ted use of funds, reporting and audit requirements, other mandates 31

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h. Reporting to board of County Commissi oners, Tampa City Council, USF Board of Governors 3. Obtain seed money to proceed $5 m illion form County, $3 Million from Tampa, $2 million from USF a. Office space, equipm ent & supplie s New USF Bioscience lab b. Staff Hire local Director and experienced personnel for key positions of marketing, solicitation and recruiting c. Consultants use USF, firm like Greenwood Consulting Group or James Carras of Carras Community Investment, Inc. d. Professional fees Legal, and Financial 4. Select loca tion (Best EZ fit for defined project) a. Validate location as LIC or persons CDIF b. Measure b ase line economic conditions USF CEDR 5. Formulate vision of project a. Measurab le objectives i. Create jobs for residents or low-incom e persons ii. Increase wages or incom es for re sidents or low-income persons iii. Increase the availability of targ et desired new high technology and bioscience career skills work fo rce by providing needed education curriculum and student assistant programs. iv. Finance or a ssist businesses committed to come to and remain in the eligible censes tract for many years. v. Other proposed comm unity impact; i.e. housing, transportation, recreation, arts b. Physical plant/real estate m ake best us e of existing USF assets and available redevelopable land in the immediate area. c. Businesses, research & p roduction Emphasis is placed on research lab facilities. However, larger areas in the country to be used for environmentally friendly production and distribution facilities. Mating all three activities of R&D, production and distribution with the countys USF labs, re-developable industrial land and transportation network of sea por t, highways and air terminal would make for an ideal environment. 6. Establish m ilestones a. 1st yearform the core people and land/f acility support resour ces and finalize the plan b. 2-3rd year recruit inve stors and businesses build the infrastructures c. 4-5th years Research and developm ent implemented d. 7th year new product production started e. 8th years and beyond product to ma rket and R&D cycle starts over f. 9th year and beyond new product growth & project expansion 7. Formulate Management / Oversight Capacity Objectives a. Sound asset risk m anagement experience b. Compliance with mandates c. Accountability to Community Community involvem ent in design, implementation and monitoring 8. Formulate Community Development Entity 32

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a. Decide on type of entity i. Non-Prof it with For Profit Subsidiaries ii. Partnership iii. Subsidiar ies iv. Identify board m embers (to include EZ representatives) v. Identify Investm ent Advisory Committee b. Decide on managem ent type i. Ownership ii. Legislation c. Establish en tity structure organization chart d. Hire staff an d train to meet needs e. Create operational rules, pr ocedures and processes f. Legislation (if necessary) 9. Formulate capital/funding/investment strategy a. Investor Strategy with R OI of 30% b. Sources and use of capital (Loans, gr a nts, tax credits other incentives) c. Decided on target am oun ts of capital by use i. 25% start-up, early stage developm ent ii. 50% exis ting companies willing to relocate iii. 25% Production of new products & services d. Map out anticipated fl ow of allocations e. Select target funding sources i. DBLF ii. CDVCA iii. QTI iv. ESGF v. Private Funds vi. SBIR vii. STTR viii. ATP ix. In-kind Trad e 10. Create Business Plan a. Select products, services and investment criteria b. Leverage prior perform ance c. Project business activity d. Consider investm ent in unrelated entities 11. Solicited funds and resources 12. Implement business plan 13. Promote opportunities 14. Expand partnerships 15. Make award s 16. Measure results & m ake adjustments a. Make adjustm ent to plans and procedures as necessary b. Grow or red uce fund and scope as necessary c. Report results to all concerned 33

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E. Community Impact Economic Assessment Here we perform a community impact analysis of the Bioscience and other High-tech industries in Hillsbo rough County, Florida. We use REMITM Policy Insight, a leading economicforecasting and policy-analysis computer model.1 We selected five NAICS industry subsectors to represent this cluster of knowledge-based businesses.2 Those industry subsectors are: 1. NAICS 325, Che mical Manufacturing, 2. NAICS 333, Machinery Manufacturing, 3. NAICS 334, Com puter and Elect ronic Product Manufacturing, 4. NAICS 339, Miscellaneous Manufacturing, and 5. NAICS 541, Professional, Scien tific, and Technical Services. Our purpose is to forecast economic and fiscal metrics for all industries in Hillsborough County out to 2010. This baselin e forecast presumes no ch ange in the historical trend of industrial activity in the County. Then, we forecast a revi sed picture for the Countys economic and fiscal metrics, if 100 jobs were recruited in 2007 for each of the Bioscience / High-tech industry subsectors. We summarize the results in Table 1 I n Panel A of Table 1 we show the baseline forecast for each Bioscience / High-tech industry subsector as a percent of Hillsborough Countys total output and total employment. 3 Professional, Scientific, and Technical Services is, by a wide margin, the largest subsector contributing about 6.5% of the Countys output and employment. Further, we forecast that if the historical trend continues only tw o of the five industry subsectors will expand relative to the County s total economy, while the others will decline. The expanding subsectors are Computer and Electronic Product Manufact uring and Professional, Scientific, and Technical Services. 1 See http://www.remi.com for technical informat ion about the model. 2 The North American Industry Classification System (NAICS) is a method of hierarchical industry classifications jointly adopted by Canada, Mexico, and The United States. In the U.S. the system is managed and promulgated by The Office of Management and Budget (OMB). 3 Output is akin to Sales, i.e. output equals sales + or an inventory adjustment. Employment refers to jobs, not necessarily the number of employed people b ecause a person can hold more than one job. 34

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Table 1 Summary of Economic and Fiscal Effects Panel A Hillsborough County Baseline Lev els Year: 2007 2008 2009 2010 Output (% of All Industries) Chemical Manufacturing 0.85% 0.83% 0.81% 0.80% Machinery Manufacturing 0.23% 0.23% 0.22% 0.21% Computer & Electronic Mfg 1.01% 1.14% 1.27% 1.41% Misc Manufacturing 0.21% 0.20% 0.20% 0.20% Prof, Sci & Tech Services 6.49% 6.52% 6.54% 6.56% Total Emp (% of All Industri es) Chemical Manufacturing 0.23% 0.22% 0.22% 0.21% Machinery Manufacturing 0.13% 0.13% 0.13% 0.12% Computer & Electronic Mfg 0.12% 0.12% 0.13% 0.13% Misc Manufacturing 0.13% 0.13% 0.12% 0.12% Prof, Sci & Tech Services 6.53% 6.55% 6.57% 6.60% Panel B Hillsborough County Differenc es from Baseline Year: 2007 2008 2009 2010Output (All Industries Fixed 2000$) Chemical Manufacturing $64,000, 000 $67,000,000 $70,000,000 $73,000,000 Machinery Manufacturing $35,000,000 $37,000,000 $39,000,000 $41,000,000 Computer & Electronic Mfg $140,000, 00 0 $158,000,000 $174,000,000 $190,000,000 Misc Manufacturing $36,000,000 $38,000,000 $39,000,000 $40,000,000 Prof, Sci & Tech Services $7,000,000 $7,000,000 $7,000,000 $7,000,000 Total Emp (All Industries) Chemical Manufacturing 273 284 289 290 Machinery Manufacturing 217 225 228 229 Computer & Electronic Mfg 425 451 467 474 Misc Manufacturing 242 250 253 253 Prof, Sci & Tech Services 56 58 59 59 Net Fiscal Impact (2004$) Chemical Manufacturing $1,604,59 0 $2,124,300 $2,641,820 $3,108,510 Machinery Manufacturing $1,453, 630 $1,924,000 $2,381,210 $2,796,800 Computer & Electronic Mfg $3, 343,300 $4,393,600 $5,422,700 $6,366,600 Misc Manufacturing $1,854,500 $2,385,230 $2,911,100 $3,383,500 Prof, Sci & Tech Services $290,950 $433,652 $573,430 $700,200 35

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In Panel B of Table 1 we forecast differences from the baseline, if 100 jobs were recruited in 2007 for each of the Bioscience / High-tech indust ry subsectors. We report the dollar amount of increase in output, increase in employment, and the net fiscal impact.4 Recruiting 100 jobs for Computer and Electronic Product Manufacturing would have the largest economic and fiscal impacts on Hillsborough County. We predict th at the 100 new jobs would boost the Countys total output by $140 million in the first year (2007) and increase to $190 million by 2010. And, as the effect of the new jobs ripples throughout the economy total employment rises by 425 jobs in 2007, increasing to 474 jobs by 2010. The net fi scal impact is about $3.3 million in the first year and about $6.6 million in 2010. As we show in Panel B, Table 1, recruiting 100 ne w jobs in any of the other Bioscience / Hightech industry subsectors would result in positive econom ic and fiscal effects, but not as great as produced by the Computer and Electronic Product Manufacturing subsector. For all subsectors, the model predicts that the implied Employment Multipliers increase year over year, as the effects of the added jobs are fully absorbed into the economy.5 The employment multipliers are: 2007 2008 2009 2010 Chemical Manufacturing 2.73 2.84 2.89 2.90 Machinery Manufacturing 2.17 2.25 2.28 2.29 Computer and Electronic Pr oduct Manufacturing 4.25 4.51 4.67 4.74 Miscellaneous Manufacturing 2.42 2.50 2.53 2.53 Professional, Scientific, and Technical Services 0.56 0.58 0.59 0.59 Interestingly, notice that because of the wide vari ety of industries in the P rofessional, Scientific, and Technical Services subsector and because of the competitive market structure built into the model, 100 new jobs in that subsector are predicted to produce a net gain of only 56 to 59 jobs in Hillsborough County. Further details of this Community Im pact Econom ic Assessment are found in Appendix E. 4 Net fiscal impact is the combined change in State an d local governments revenue and expenditures as a result of the added jobs. 5 The implied employment multipliers summarize the impact of recruiting new jobs into an area. For example, an employment multiplier of 2.50 indicates that adding 100 new jobs in an industry will generate a total of 250 (100 x 2.50) jobs for the areas economy. 36

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8. Findings Attributes and characteristics of potentially successful community-initiated development projects From the research we find that community deve lopm ent projects seem to take on a variety of structures. Some are large scal e LIC projects based on tax cred its or venture capital alliances while others are on a smaller scale that rely on Angle Investors and Small Business programs funding. The projects seem to be scaled, as we ll as driven, by the na ture of the businesses involved and the desired community impact. The important factor does not seem to be the structure that it takes. The structures take shape as the project evolves. Our findings identify key attributes and charac teristics of potentially successful communityinitiated developm ent projects. The projects tend to have four basic components of (1) management oversight and capaci ty, (2) capitalization and funding strategy, (3) business plan, and (4) community impact. Furthermore, the su ccess factor seems to be even higher if these elements are all interrelated to each other and linked with the governmental entity and the investors. The figure below shows these components and their linkage. Key Components of Successful Community Projects Direct Flow Indirect Flow Hillsborough County Bioscience CDE Investors Capitalization / Funding Strategy Management / Oversight Capacity Business Plan Community Development Impact Subsidiary USF Subsidiary Lab A Lab B The four components can are briefly described as follows: 1. Managem ent / Oversight Capacity consist of: Sound asset risk m anagement experience Compliance with mandates Accountability to Community Community involvem ent in design, implementation and monitoring 2. Capitalization / Funding Strategy incorporates: Investor Strategy 37

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Sources and use of capital Flow of allocations 3. Business Planning includes Products, services and investm ent criteria Prior perform ance Projected business activity Investment in unrelated entities 4. Community Developm ent Impact requires: Targeting the use of Qualified Low Inco m e Community Investments within Low Income Communities Economic Impacts are achieved by using specific realistic projections and using a business plan proven successful from other prior community project performance Investments in unrelated entities that br oadens the project and creates growth opportunities Also, the findings indicated that the projec ts addressed at least one of the Community Developm ent Impact Goals as spelled out in The CDFI Fund 2006 allocation application for NMTC. These impact categories are: Create jobs for residents or low-incom e persons Increase wages or incom es for re sidents or low-income persons Target job creation to areas of high unem ployment Finance or a ssist businesses committed to remain in the eligible censes tract Finance or assist busine sses owned by residents Finance or assist m inority or women-owned businesses Other proposed comm unity impact; i.e. hous ing, transportation, recreation, arts 38

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9. Summary The New Triple Bottom Line Community Development Economy As indicated above the harnessing of both co mm unity and private energy/enthusiasm, funding, and resources is a large driving force to any co mmunity-initiated project. I consider this dynamic trio extremely important. I call it the Power of Three. This concept has been recently coined by John Elkington, co-founder of the busin ess consultancy SustainAbility and recognized by Arthur Warmoth, Ph.D. Sonoma State Univers ity & Skaggs Island Foundation. They call it the new Triple Bottom Line Development Economy. I have concluded that this new concept is based on three basic values of People Money Property (PMP) Understanding these values and interrelationshi ps are key to the success of any Community Developm ent Entity Project. It is important fo r decision makers to weigh these factors when making decision along the projects evolution path. The figure below shows this relationship. The Power of Three = values of PMP Each Interrelated with Money in the Middle Money People Property Characteristics of the three values are explained as the follows: People: o make up the community and form an economics of the commons (public goods and services, sustainable ecology, quality of life). o foster hum an creativity and relationships that intrinsically forms wealth. Money o should be viewed as an agreem ent, not a thing. o Is created by an agreem ent within a community to use something countable as a medium of exchange. o has value only within a society where it can be used to purchase tangible goods and services. o provides a comm unity with a fungible information system standardizing measurements of value in order to facilitate trade. 39

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Property o forms the economics of markets. o includes: material, useable land, trade goods, and services For a newly initiated community development projec t or enterprise to be successful in this new three v alue based it needs to embrace three qualitie s. These qualities are, as I have labeled them, SOS. SOS represents; S ufficiency, O ptimization, S ustainability. Sufficient m aterial goods Optimal quality of life, based on the abundan ce of personal and community-oriented services Sustainable ecological s ystems To show how the Triple Bottom Line PMP (value s of Money, People and Property) interact with SOS (qualities of Sufficiency, Optimization, and Su stainability), I have devised a table showing how one effects and influences the other. Values Qualities People Money Property Sufficiency -Social Justice -Satisfaction of hum an needs -Profitability -Return on Investment -Supply -Land -Material -Labor Optimization -Wages -Employment -Accumulation of assets /wealth -Flow & exchange -Return on Investment -Creation of opportunity -Best use -Conserve limited supply -Environmental impact Sustainability -Quality of life -Tim e value (NPV) -Sources *As defined by Abraham Maslows (1954) hier archy: physiological, safety, love, and belongingness, esteem and self-esteem, and self-actualization 40

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Appendix A CDE Certification Q & A Document Comm unity Development Financial Institutions Fund Contents Reference: http://www.cdfifund.gov/docs/cert ification/CDE/CDE certificationFAQs.pdf General Application and Eligibility Questions 1) What is a Community Development Entity (CDE)? 2) What benefits are there to becoming a CDE? 3) How does an entity apply to become a CDE? 4) What types of entities are eligible to apply for CDE certification? 5) Who should be listed as the Applicant CDE in the Applic ant Information section? 6) May an entity apply for certification as a CDE on behalf of itself and on behalf of Subsidiary organizations under a single CDE Certification A pplication? 7) Under what circumstances woul d an organization want to certify Subsidiary en tities as CDEs? 8) What criteria will the CDFI F und use to determ in e CDE eligibility? 9) Is there an application deadline for organizations seeking designation as CDEs? 10) If an organization that is no t a ce rtified CDFI is interested in obtaining certification as a CDFI as well as certification as a CDE, should it apply for CDFI certification, CDE certification, or both? 11) For how long is the CDE de signation valid, and what reporti ng requirem ents will the Fund impose on certified CDEs? 12. How does CDE certification diff er from CDFI certification? Questions Regarding Stat us as a Legal Entity 12) Can a sole proprietorship or s ingle member LLC become a CDE? 13) Can a governmental entity become a CDE? 14) The Fund requires that each entity applyi ng f or CDE certification provide documentation that it has been assigned an Employer Identifi cation Number (EIN) from the IRS. How do I obtain an Employer Identification Number (EIN), or request verification of an already assigned EIN? Designation of Low-Income Communities 15) What is the definition of a LIC? 16) How do I determine if an address is in an elig ible LIC census tract? 17) What should I do if CIMS c ould not geocode an address? 18) Is it possible to designate add itional areas as qualifying LICs? Questions Regarding Accountability 19) What characteristics must board members po ssess in order to be deemed representative of LICs? 20) Can a board member that is a principal or staff person of the applicant or affiliate, or a principal or staff m ember of an investor, be deemed representative of LICs? 21) Can a board member that is an employee of a bank, and whose princi pal responsibilities are with the community developm ent department of the bank, be deemed representative of LICs? 41

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22) Can a board member that is a retiree whose career was spent in the community or economic development fieldsbe deemed representative of LICs? 23) Can a board member that is an employee of a redevelopment or economic development authority (statewide or local level) be deem ed representative of LICs? 24) Can a board member that is an elected official or an individual working for an elected official be deemed representative of LICs? 25) Can a board member that is an employee or board member of a non-affiliated communitybased or charitable organization be deemed re presentative of LICs if the mission of that organization does not clea rly indicate that it primarily serves LICs? 26) How do I demonstrate accountability to LICs in m y service area if I am serving a large geographic area (e.g., a state, a multi-st ate region or the entire nation)? 27) When should a certified CDE am end its service area? 42

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Appendix B 2006 NMTC Allocation Application Q & A Document, Community Development Financial Institutions Fund This document is a second revi sion of a docum ent or iginally published on July 14, 2005. On August 26, 2005, minor clarifications were made to Q&A #24; Q&As #30 and #38 were substantially revised; and three new Q&As were added (#s43-45). On September 9, 2005, two new Q&As were added (#46 and #47). Table of Contents Questions on the NMTC Program (1) How does the New Markets Tax Credit (NMTC) Program work? (2) What is a CDE? Questions on Eligibility and CDE Certification (3) Who is eligible to apply for NMTC Allocations? (4) What are the deadlines and dates that I need to know if m y organizatio n intends to apply for NMTC Allocations in 2006? (5) My organization submitted its CDE Certification Application prio r to the August 2 2, 2005 deadline, and received a confirmation that it was in fact received. Will the Fund be able to make a determination regarding my cer tification status prior to Sept ember 21, 2005? If not, how will this affect my ability to submit an NMTC Allocation Application to the Fund? (6) Is an entity that has previously received a CDFI or BEA Program award (or an Affiliate of such an awardee) elig ible to apply for NMTC Allocations? (7) Is an entity that has previously received an Al location (o r an Affiliate of such entity) eligible to apply for NMTC Allocations and, if so, does it have any advantage or disadvantage with respect to competing for an Allocation? (8) If my organization intends to transfer all or part of an NMTC Allocation to one or more Subsidiaries, do the Subsidiaries need to b e established and certif ied as CDEs prior to submission of the Allocation Application? (9) Can non-profits apply for a NMTC Allocation? (10) In Question #12 of the Allocation Application, can I designate a service area that is different than the serv ice area that I was certified for in my CDE Certification Application? Similarly, can a CDE modify its service area after closi ng an Allocation Agreement with the Fund? Questions on the Process for Applying for and Receiving a NMTC Allocation (11) How can my organization apply for NMTC Allocations? (12) What is the process for submitti ng an online Allocation Application? (13) What is the process for submitting a paper application? (14) What are the advantages to submitting an online application? (15) What attachments am I required to subm it with m y Allocation Application, and how do I submit them? (16) Will the information that I provide in m y Allocation Application be accessible by the general public? (17) Can more than one Affiliated entity submit an application? 2006 NMTC Allocation Application Q & A Document 43

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(18) Can my organization apply for a NMTC Allocati on on behalf of Subsidiary entities, as it did with its CDE Certification Application? (19) Are there any limitations with respect to using NMTCs, or the proceeds of QEIs, in conjunction with other CDFI Fund program awards? (20) When will the Fund make Allocation decisi ons? Can m y organization start to offer NMTCs to investors as soon as it receives an Allocation? (21) What terms and conditions will be placed up on Applican ts that receive NMTC Allocations from the Fund? (22) My organization applied for an Allocati on of tax credits in a previous round. How do I access an electron ic copy of that app lication and my de briefing document? (23) May I offer NMTCs to invest ors that m ade an investment in my organization before it received an Allocation of NMTCs? (24) Who can I contact if I have more specific questions? Questions on the NMTC Allocation Application Contents (25) When requesting NMTC Allocations from the Fund, should the Appli cant ask f or the total amount of equity it intends to raise through NMTCs, or should it as k for the total value of the tax credits that will be available to its investors? (26) Is there a limit to the tota l NMTC Allocation am ount that an Applicant may request in the 2006 Allocation round? (27) If an Applicant indicates a minimum allo cation am ount (Q#59), will it receive at least its minimum request if it makes it to the pool of poten tial allocatees? (28) How do I complete the Allocation Applicat ion if m y organization is a start-up entity? (29) If an Applicant intends to use part or all of the QEI proceeds to capitalize an Affiliate CDE (e.g., capitalize a Subsidiary CDE bank), how should it complete the Allocation Application ? (30) Who can be considered a Controlling Entity, for purposes of de monstrating an organizational track record in the Business Stra tegy and Capitalization Strategy sections and in Exhibits A and E? Can an individual be consid ered a Controlling Entity? Can an Applicant have more than one Controlling Entity? Can an Applican t identify the parent of its parent company as a Controlling Entity? (31) If the Applicant (or Contro lling Entity ) engages in activities through one or more subsidiary entities, am I permitted to pres ent these activities on a consolidated basis for the purposes of completing the tables in Exhibit A? (32) What data should I be providi ng in the tables in Exhibit A? (33) The Instructions in Exhibit A state th at an Applicant that doe s not itself have a track record of activities may rely upon the track record of its Controlling Entity. What if the Applicant does have a track record of activities, but the track record is relatively limited in comparison to that of its Controlling Entity? May I choose instead to use the Controlling Entitys track record for the purpose of filling out the tables in Exhibit A? (34) There are some activities that are not clearly prohibited by the IRS Tax Regulations, but that are also not clearly allowed. If m y business strategy falls within one of these more undefined areas, how will my applicati on be scored by the Fund? (35) What is a non-real estate versus real estate Q ALICB? (36) Is there an example of what format the Fund would like to see in Questions #10a and 10b of the Alloc ation Application? 44

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(37) In Question #28 of the Allo cation Application, how can an Applicant earn the 5 priority points for investing in Unrelated entities? (38) What are some examples of permissible and non-perm issible activities for organizations that answer yes to Question #29b? (39) What documents are considered acceptable to dem onstrate investor commitments for Table E1 and per Question #50? (40) My organization has not yet received commitm ents f rom its investors. Will this prevent it from scoring well under the Capitalization Strategy section of the application? (41) Tables 1-4 in Exhibit D include a column heading Years with (or y ears providing services to) the Applicant. In completing this informa tion, may a start-up entity refer to the years of service that an individual provided to its Controlling Entity? (42) In Table C1, there is a column heading # of projects. How should this column be completed relative to each row in the table? New Questions (Added Since July 14, 2005 Version of Document) (43) Questions #32 and #33 in the Allocation Ap plication ask the App licant to quantify the community and economic im pacts it hopes to achieve, and to describe the underlying methodologies and assumptions sup porting its projections. Should such assumptions also include a discussion of means by which the A pplicant intends to achieve its goals? (44) The Application includes se veral Tips inform ing Applican ts that responses to certain questions may be used to populate fields in thei r Allocation Agreements, should they receive an allocation award. Are these the only applicationspecific items that will be included in the Allocation Agreements for 2006 round allocatees? (45) The Fund has provided clarific a tions in the Application that instruct Applicants to only reference in the Tables in Exhibit A, and in the narrative to Question #22, loans or investments that the Applicant (or its Contro lling Entity) have directly origin ated and for which it has capital as risk. Does this suggest that developers or othe r entities that have not actually originated loans or investments are at a distinct disadvan tage when applying for NMTC allocations? New Questions (Added Since Augu st 26, 2005 Version of Document) (46) Will the Fund extend the September 21, 2005 Allocation Application deadline due to recent natural disasters aff ecting parts of the U nited States? (47) Are major disaster areas considered to be particularly econom ically distressed or otherwise underserved communities, as such term is used in Question #29 of the Allocation Application? 45

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Appendix C Kansas Legislator Briefing Book 2005 This document includes legi slated guidance for the fund Reference: http://skyways.lib.ks.us/ksleg/KLRD/Publications /Briefs/G2BioscienceAuthority.pdf#search=' bi oscience%20funds Kansas Technology Enterprise Corporation (KTEC) http://www.ktec.com/index_Flash.htm Tracy Taylor President & CEO (785) 296-5272 ttay lor@ktec.com KTEC, 214 S.W. 6th St. First Floor, Topeka, KS 66603, (785) 296-5272, Fax: (785) 296-1160, info@ktec.com The Kansas Technology Enterprise Corporati on (KTEC) is a private/public partnership established by the state of Kansas to prom ot e technology based economic development. Through support of strategic research and development at our Centers of Excellence, through intense hands-on business assistance at ou r incubators, and through our equi ty investments in early-stage companies, KTEC serves as an invaluable partner to companies that bring economic growth to Kansas. As a natural extension of its mi ssion, KTEC has played a key role in the statewide Bioscience Initiative. As a sponsor of the Regional Bi oscience & Innovation Roadmap process, as a founding member of Kansas Bio and as a support to the Kansas Bioscience Authority, KTEC is dedicated to statewide success in the competitive bioscience industry. How KTEC Works KTEC is a private/public part nership established by Kansas to prom ote technology based economic development. KTEC assists Kansas entrepreneurs and technology companies by supporting the development and commercializati on of new technologies through a statewide network designed and built to support research ers, entrepreneurs, and technology companies through each phase of the technology life cycle. The ultimate goal of the program is to create rapid growth companies and higher paying jobs The KTEC's many programs and affiliate organizations fall into three basic functional areas: Strategic Research and Devel opm ent/Centers of Excellence: Located at the state' s universities, these Centers conduct basic a nd applied industry-led research that is the foundation fo r new products and technologies. KTEC's Intense, Hands-on Bu siness Assistance/Incubators: Unique private/public partnershi ps designed to turn intellectu al property and science into businesses and products to se ll in the m arketplace. 46

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KTEC Investment Funds: KTEC provides equity investment in early-stage technology com panies and helps companies acquire the capit al they need in critical early states. KTEC: A Key Ally in the Biosciences As a natural extension of its m ission, KTEC has played a key support role in the statewide Bioscience Initiative. As a sponsor of the Re gional Bioscience & Innovation Roadmap process, as a founding member of KansasBio, and as a support to the Kansas Bioscience Authority, KTEC is dedicated to statewide succe ss in the competitive bioscience industry. KTEC: A Key Ally in the Biosciences Kansas looked to KTEC to play a cen tral role to ensure that the state successfully creates a viable bioscience industry within its borders. KTEC has been ready, willing and able to serve in this capacity, as biosciences are a natural extension of its mission to support technology-oriented economic development KTEC leveraged its expertise a nd resources to play a key role in the developm ent of the biosciences portions of the Kansas Economic Gr owth Act (KEGA). KTEC believes that Kansas should always look to the future and prepare itself for the ne xt wave of technology-oriented opportunities. Along with many key partners in the Kansas Legislature and Administration, KTECs efforts to create and pass KEGA have positioned Kansas to become a leader in the field of biosciences. As part of its mission to support technology-oriented economic development in Kansas, KTEC has sponsored the Kansas Bioscience & Innova tion Roadm ap process this past year. The Roadmap process will provide Kans as a strategic plan as it moves forward to stake its claim in the bioscience industry. KTEC continues its commitment to the Bioscien ce Initiative, serving as a founding mem ber of KansasBio and supporting the Kansas Bioscience Authority. KTEC is committed to the success of this Statewide Bioscience Initiative, ensuring that Kansans reap the be nefits of a successful bioscience industry. Statewide Bioscience Initiative: Kansas Econom ic Growth Act As a first step in its bioscience-specific work, KTEC assisted in the development of the Kansas Econom ic Growth Act (KEGA), which has at its core the statewide Bioscience Initiative 47

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KTEC leveraged its knowledge and resources during the developm ent, research and writing phase of KEGA. KEGA passed with overwhelming margins in both the House and Senate, and was signed into law last year. Since that time KEGA has drawn national attention and accolades. The Bioscience Initiative within KEGA provides a tangible process for prom otion and support of the bioscience industry. A funding mechanism in KEGA, tied to growth in the Kansas bioscience industry, is expected to generate more than $580 million over the next 10 to 15 years. These funds can be utilized to develop the biosci ence researchto-developm ent continuum, recruit world-class scholars, fund the development of the necessary la b space and equipment to conduct superior research in the biosciences, drive the commercialization of bios cience discoveries, and support the growth of the bioscience industry base. In order to receive the best guidance possible in the use of such funds, KEGA created the Kansas Bioscience Authority (BioAuthority)-a com ple tely independent body composed of prominent local and national leaders in th e areas of technology, science and economic development. To ensure every possible chance of success, KTEC is working closely with the BioAuthority. This prominent and innovative group, supported by KTEC and its resources, is positioned to change the economy and quality of life for all Kansans 48

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Economic Development G-2 Bioscience Authority The Kansas Economic Growth Act (2004 HB 2647) created the Kansas Bioscience Authority. The m ission of the Authority is to make Kansas a desirable state in which to conduct, facilitate, support, fund, and perform bioscience researc h, development, and commercialization. In addition, the Authority is to make Kansas a national leader in bios cience, create new jobs, foster economic growth, advance scientific knowledge, and therefore, improve the quality of life for all Kansas citizens. The paper only discusses the Bioscience Authority w hile the bill contains numerous other economic development measures. Governance The Kansas Bioscience Authority is governed by an 11-m ember Board of Directors. "Nine members are voting members representing the ge neral public who demonstrate leadership in finance, business, bioscience research, plant biotechnology, basic researc h, health care, legal affairs, bioscience manufacturi ng or product commercialization, education, or government. In addition, one member of the Board is to be an agricultu ral expert who is recognized for outstanding knowledge an d leadership in the field of bioscience. The Governor, the Speaker of the House, and the Presiden t of the Senate will each appoint two Board members, and the House Minority Lead er, Senate Minority Leader, and Kansas Technology Enterprise Corporation (KTEC) will each appoint one member. Two non-voting members of the Board are to be representing state research universities and have research expertise and represent Kansas universities. The voting members are subject to Senate conf irmation and will serve four-year terms after conclusion of the initial term with no more than three consecutive four-year terms. The Bioscience Authority is to be headquartered in the county with the highest num ber of bioscience employees associated with bioscience companies. The Authority, with state universities, will identif y and recruit em inent and rising star scholars; jointly employ personnel to assist or complement eminent and rising star scholars; determine types of facilities and research; facilitate inte grated bioscience resear ch; and provide matching funds for federal grants. Powers The powers of the Authority include: Oversee th e commercialization of bioscience intellectual property created by eminent and rising star scholars. Own and possess patents, proprietary t echnology, and enter in to contracts for commercialization of the research. 49

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Incur indebtedness and enter into contracts with the Kansas Development Finance Authority (KDFA) for bonding to construct st ate-of-the art facilities owned by the Authority. Neither the State of Kansas nor Kansas De velopm ent Finance Authority would be liable for the bonds of the Authority. Purchase, lease, trade, and transfer prope rty. Architecture and c onstruction requirements similar to those affecting the research univers ities research faciliti es also would apply. Solicit and study business plans and proposals. Establish a contractual relationship w ith Ka nsas Technology Enterprise Corporation and the National Institute for Strategic Technology Acquisition and Commercialization (NISTAC) for the first five years of operation. A repaym ent agreement would be required for any bioscience company that receives grants, awards, tax credits, or any other fi nancial assistance, incl uding financing for any bioscience development project, if the compa ny relocates operations associated with the funding outside Kansas within 10 years after receiving such financial assistance. The Authority would be required to specify th e terms of the repayment obligation and the amount to be repaid. Eminent domain would not be allowed to be used to secure agricultural land for a bioscience project. Revenues and Fund Uses Emerging Industry Investment Act (also part of th e bill) creates the Bioscience Development Investment Fund which will not be a part of the state treasury. Funds in the Bioscience Deve lopm ent Investment Fund would belong exclusively to the Authority. The Secretary of Revenue and the Au thority would establis h the base year of taxation for all bioscience companies and all state universities conducting bioscience research in the state. The Secretary of Revenue, the Autho rity, a nd the Board of Regents would establish the number of bioscience employees associated with state universitie s and report annually and determine the incremental increase from the base annually for the following 15 years from the effective date of the Act. All of the in cremental state taxes generate d by the growth of bioscience companies and research institutions over and above the base taxation year would go into the Fund. The baseline amount of state taxes would go to the State General Fund each year. The Bioscience Development Inve stment Fund would be used to fund programs and repay bonds. Bioscience Development Financ ing Act (cr eated in the bill) allows the creation of tax increment financing districts for bioscience development. One or m ore bioscience development proj ects could occur within an established bioscience development district. The process for establish ing the district would follow the tax increment financing statutes. However, no bioscience developmen t district can be es tablished without the approval of the Authority. 50

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Counties are allowed to establish bioscience development districts in unincorporated areas. Kansas Developm ent Finance Authority may issue special obligation bonds to finance a bioscience development project. The bonds would be paid with ad valorem tax increments, private sources, contributions, or other financial assistance from the state and federal government. The bill creates th e Bioscience Developmen t Bond Fund which will be managed by the Authority and not be part of the state treasur y. A separate account will be created for each bioscience development district (BDD) and distributions will pay for the bioscience development project costs in a bioscience development district. Bioscience Tax Investment Incentive Act (cr eate d in the bill) will make additional cash resources available to start-up companies. Th e bill creates the Net Operating Loss Transfer Program The Program will allow the Bioscience Authority to pay up to 50 percent of a bioscience companys Kansas Net Operating Loss Transfer Program during the claimed taxable year. The Program will be managed by the Kansas Department of Revenue and would be capped at $1.0 m illion for any one fiscal year. Bioscience R & D Voucher Program Act (created in the b ill) establishes the Bioscience R & D Fund in the state treasury. The Fund could receive state a ppropriations, gifts, grants, federal funds, revolving funds, and any other public or private funds. The Program requires that any Kansas com p anies conducting bioscience research and development apply to the Authority for a rese arch voucher. After receiving a voucher, the company will then locate a researcher at a Kansas university or college to conduct a directed research project. At least 51 percent of voucher award funds w ould be expended by th e university in the state under contract and could not ex ceed 50 percent of the research cost. The maximum voucher funds awarded cannot exceed $1.0 million each year for two years, and not to exceed 50 percent of the research costs. The company is required to provide a one-to-one dollar match of the pr oject award for each year of the project. Bioscience Research Matching Funds Act (creat ed in the b ill) establishes the Bioscience Research Matching Fund to be adm inistered by the Authority. Recipien ts must be a bioscience research in stitution and are encourag ed to jointly apply for funds. The funds would be used to prom ote bioscience resear ch and to recruit, employ, fund, and endow bioscience faculty, research positions, and scientists at universities in Kansas. Application for the m atching funds will be made to the Authority. For more information, please contact: Kathie Sparks, Principal Analyst Su san Kannarr, Senior Fiscal Analyst KathieS@klrd.state.ks.us SusanK@klrd.state.ks.us Kansas Legislative Research Department 51

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300 SW 10th Ave., Room 545N, Statehouse Topeka, Kansas 66612 Phone: (785) 296-3181 Fax: (785) 296-3824 40494~(12/6/4{4:29PM}) Economic Development G-2 Bioscience Author ity Other Econom ic Development reports available: G-1 STAR Bond Authority Kathie Sparks, Principal Analyst 785-296-3181 KathieS@klrd.state.ks.us 52

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Appendix D Phoenix Community Development and Investment Corporation Lending Guidelines for Bioscience or Technology Industries Effective, Date: PCDIC Board approved March 30, 2005. http://www.phoenixnewmarkets.org/links.html Lynda Dodd at 602-261-8708 or write to us at: Phoenix Community Development and Investment Corporation c/o City of Phoenix, Community a nd Econom ic Development Department 200 West Washington 20th Floor Phoenix, AZ 85003 Phone: 602-262-5040 Fax: 602-495-5097 TTY: 602-534-3476 Phoenix has an exciting new program that will help our com munity grow in areas that have not seen as much economic growth as in past ye ars Phoenix New Markets Program. While industry experts who helped shaped this new legislation have known about the pote ntial benefits of the federal New Markets Tax Credit (NMTC) Program for several years, most communities only recently learned about its potential economic impact. We have a ne w tool that will provide much needed cash and equity investment to assist in the economic revitali zation of our under-served communities by creating new jobs, enhancing Ph oenixs commercial, retail and industrial development, and financing small businesses. Our Goals Through the NMTC Program our primary mission is to improve the economic conditions in Phoenixs under-served communities. Participants in Phoenixs program must conduct business and provide services in an eligible census tr act that meets community impact standards. Minimally, the recipient must show that their activity: Creates jobs for resident s or low-incom e persons Increases w ages or incomes for residents or low-income persons Targets job creation to ar eas of high unem ployment Finances or assis ts businesses committed to remaining in the eligible census tract Finances or assists busin esses owned by residents Finances or assists m inority or women-owned businesses Other proposed comm unity impact How the New Markets Tax Credit Program Works The Program is administered by the U.S. Depa rtm ent of the Treasury, Community Development Financial Institutions Fund (CDFI). The CDFI awarded Phoenix a $170 million allocation that allows Phoenix to issue tax credits of $66.3 million to eligible investors. In exchange for tax credits, the Phoenix New Markets Program will rais e equity that will provide below market rate loans and equity investment for eligible busines ses in under-served areas of Phoenix. Under this program, investors will receive a 39% tax credit over 7 years. 53

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5% for each of the first 3 years 6% for each of the last 4 years History In Decem ber 2000, Congress passed legislation creating the New Markets Tax Credit (NMTC) Program as part of the Community Renewal Tax Relief Act to encourage private investment in low-income communities. The U.S. Department of the Treasury, Comm unity Development Fina ncial Institu tions Fund (CDFI) administers the NMTC Program whic h will release $15 billion from 2002 through 2007. After a highly competitive process, CDFI made it s first allocation in March 2003 to 66 agencies that will receive $2.5 billion. In May 2004, CDFI a nnounced its second allocation to 62 agencies that will receive $3.5 billion. In order to be considered for the progra m Phoenix created an independent non-profit corporation, Phoenix Community Development and Investment Corporation (PCDIC), to become a certified Community Development Entity (CDE). Of the $2.5 billion, Phoenix has been awarded $170 million in NM TC allocation or $66.3 million in tax credits ($170 million X 39%). We have two programs designed to reach our goals: Business and Commercial Development (real estate) Loans Small Business Financing Phoenix Community Development and Investment Corporations five-member Board has m ajority representation from leaders in Phoenixs under-served communities. Our Board is 54

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charged with ensuring that Phoenixs NMTC Progr am meets our primary mi ssion to attract and provide funds for projects that will improve the quality of life of those individuals who live and work in under-served areas of the community. Pete C. Garcia President/C EO Chicanos Por La Causa, Inc. www.cplc.org Chicanos Por La Causa is a statewide community development corporation committed to building strong, healthier communities as a lead a dvocate, coalition builder and direct service provider. CPLC promotes positive change and self -sufficiency to enhance the quality of life for the benefit of those we serve. George Dean President/C EO Greater Phoenix Urban League 1402 S. 7th Ave Phoenix, AZ 85007 602-254-5611 FAX 602-253-7359 george.dean@excite.com www.greaterphxurbanleague.org The mission of the Greater Phoenix Urban League is to assist African Americans, other minorities and the disadvantaged in the achieve ment of social and economic equality. The League implements its mission through advocacy, bridge building, program services Donald P. Keuth Presiden t Phoenix Community Alliance 502 E. Monroe, Suite C100 Phoenix, AZ 85004 602-254-7477 FAX 602-253-9192 www.phoenixcommunityalliance.com The PCA is a non-profit organization formed in 1983 to help create a dynam ic and vital central city core. Today it numbers over 135 corporate members from central Phoenix and all over the valley in addition to over 65 ad junct members who are leaders representing government (city, county, state and federal), as well as educational, cultural, religious and civic organizations plus individual property owners. Roberto Franco City of Phoenix Acting Community and Econom ic Development Director 200 W. Washington, 20th Floor Phoenix, AZ 85003 602-262-5040 FAX 602-495-5097 roberto.franco@phoenix.gov www.phoenix.gov/ECONDEV/cedabt.html The Community and Economic Development Department stimulates economic activity by offering a diverse range of value-added business programs to build, revitalize, and sustain a quality community for Phoenix businesses and residents. 55

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Bob Wingenroth City of Phoenix Chief Financial Officer 201 W. Washington, 9th Floor Phoenix, AZ 85003 602-262-7166 FAX 602-495-5605 bob.wingenroth@phoenix.gov www.phoenix.gov/FINANCE/index.html The Finance Department is responsible for maintaining a fiscally sound organization that conforms to legal requirements and to genera lly accepted financial management principles. Services provided include debt management a nd capital financing, advisory support, accounting and financial reporting, procurement of material s and services, treasury services, risk and inventory management, tax and licensing pr ograms administration, and acquisition and management of real property. Through the NMTC Program, our primary mission is to im prove the economic conditions in Phoenixs under-served communities. PCDIC seeks to offer financing to businesses that meet the qualifying criteria and demonstrate how PC DIC's financing will improve the economic conditions in the low-income community (LIC) in which they operate. Participants in Phoenixs program must conduct business and provide services in an eligible census tract that meets community impact standards. Minimally, the recipient must show that their activity: Creates jobs for resident s or low-incom e persons Increases w ages or incomes for residents or low-income persons Targets job creation to ar eas of high unem ployment Finances or assis ts businesses committed to remaining in the eligible census tract Finances or assists busin esses owned by residents Finances or assists m inority or women-owned businesses Other proposed comm unity impact PCDIC plans to sell the tax credits to large in stitu tional investors to ma ximize the use of the NMTCs. If you are interested in investing in the NMTC Program, please contact Lynda Dodd at 602.261.8708 for additio nal information. MINIMUM QUALIFICATIONS If your business or project can m eet the mi nimum regulatory requirements of the NMTC Program definition of a Qualified Active Lo w Income Community Business (QALICB), you could potentially qualify for a loan that has better terms than with a traditional lender. 56

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Low-Income Community Census Tract (LIC) The business is or will be located in a federally designated Low-Income Community Census Tract; if you choose to locate or expand your business in one of the census tracts that shows a higher economically distressed area, your project may receive higher priority c onsideration. The physical address of your business or project will be used to verify eligibility. To find out if a business is located within a specific incentive area, such as a New Markets area, an Enterprise Zone, Enterp rise Community, or a Foreign Trade Zone, visit the Phoenix Economic Development Incentive Zone Locator. This online tool can help verify if a pa rticular location is eligible for various incentives as well as provide valuable information regarding the location. Employees 40% or more of your employees work and provide services from your business or project in a LIC. To verify this test, you will be asked to provide payroll documentation. Tangible Assets 40% or more of your tangible assets of your business or project is located in the LIC. To verify this test, you will be aske d to provide documentati on of the total tangible assets and their location. Gross Income 50% or more of the gross reve nue generated from your business is generated from your business or project located in the LIC. Collectibles Less than 5% of the average aggreg ate bas is of the property located in the LIC is attributable to collectibles. Nonqualified Financial Property Le ss than 5% of the average a ggregate basis of the property located in the LIC is attribut able to nonqualified financial pr operty (ie. providing banking services). *If more than 50% of your employees work and pr ovide services in a LIC and if m ore than 50% of your tangible assets are locate d in a LIC, then the gross reve nue test is deemed satisfied. BUSINESS ACTIVITIES THAT ARE PROHIBITED UNDER THE NMTC PROGRAM INCL UDE: Raw Land (No I mprovements) Farming Rental Housing* Gambling Golf Courses Alcohol Sales Suntan Facilities & M assage Parlors Developm ent or Holding of Intangi bles for Sale or License** 57

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*PCDIC understands the impor tance of the right housing mix in improving Phoenix's communities. **At this time, PCDIC will not pu rsue funding for or investments in mixed-use or for-sale housing projects. However, if you have a housing project that includes a commercial component, your project may still qualify for financia l assistance only on the commercial piece. The Phoenix New Markets Loan Program offers comm ercial and industrial development lending opportunities in underserved communiti es within the city of Phoenix. These loans will be funded at below market pricing. PCDIC has partnered with GM AC Comm ercial Holding Cap ital Corp. ("GMAC") on a $100 million fund and 1st National Bank of Arizona ("FNBA"), M&I Community Development Corporation and Prudential Insurance on a $20 million fund. The focus for commercial real estate lending can include: Community-serving retail projects Commercial, industrial and manufact uring development projects Office developm ent Corporate and regional headquarters Loan requests will be considered that meet federal NMTC regulations for qualified businesses. In exchange for this fin ancing, we ask the business to demonstrate how their project will positively impact the community in which it is located. Borrowers will be asked to identify community impact goals that they will suppor t for the duration of their loan. Community impact benchmarks within eligible census tracts include but are not limited to the following: Remove blight, Create jobs for residents or persons below the poverty leve l in the designated area, Increase the m inimum wage level of re sidents or low-income persons hired, Increase th e number of new jobs created, Increase th e percentage of women and minorities hired in the general workforce as well as in professional and senior management positions, Increase subcontracting with m inority, disa bled and women-owned firms, and/or Create a scholarship fund or training opportunities. We are currently accepting loan inquiries for comm ercial real estate pro jects ranging upwards from $1 million. FNBA and GMAC f und perimeters are noted below: 58

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PHOENIX NEW MARKETS LOAN PROGRAM GMAC FNBA Project Type Commercial Real Esta te: Acquisition, Rehabilitation, Construction Industries Retail, Industrial/Manufacturing, Office Loan Size > $ 2 MM $1 $5 MM Total Fund Size $100 MM $20 MM Loan Term 1 3 years 7 years fixed LTV (up to) 95% 80% Amortization Interest Only 25 years on Term Loan Subsidized Rates (general) 25% Below Market Construction: Prime + 0.15% 7 years Fixed: 7 yr Treasury + 1.65% Loan Origination Fees Negotiable 1.50% Estimated Closing Time 30 45 days -Contact Information Bill Nash, GMAC 1801 California Street, Ste 3700 Denver, CO 80202 303-294-3146 or 1-800-523-9792 ext. 3146 bnash@gmacchcapital.com Loan Submission Summary Form Edward Celaya, FNBA 17600 N. Perimeter Drive Scottsdale, AZ 85255 480-458-2231 ecelaya@fnbaonline.com FNBA Phoenix New Markets Loan Program (forthcoming) Investment terms subject to change Phoenix Community Development and Invest m ent Corporation Lending Guidelines for Bioscience or Technology Industries Purpose: To provide policy dire ction and establish lending guidel ines whe n evaluating loans to businesses or for projects rela ted to bioscience and technology. Statute & Regulation: To qualify for NMTCs, a CDE must invest substan tia lly all of its qualifying equity in Qualified Businesses. Under federal stat ute and IRS regulations, a Qual ified Business does not include any trade or business consisting predominantly of the development or holding of intangibles for sale or license. This is often re ferred to as the Intangibles Test. 59

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The IRS issued the Final Regulations on Decembe r 28, 2004 and corrections to those regulations on January 28, 2005. Under the final regulations, before the correc tions, a Qualified Business did not include a rental activity to the extent the lessee of the property failed the Intangibles Test. The corrections to the Final Regulations removed the regulatory requirement that the underlying tenant pass the Intangibles Test. The IRS incl uded the limit on lessee businesses because they were concerned that CDEs could avoid the dire ct statutory prohibition on lending to businesses involving intangibles by simply st ructuring a lease. Some commentators have suggested that the existing anti-abuse language gives th e IRS authority to disallow cred its in such a situation. Other have argued that the legislative history to the NMTC specifically approves of such a structure. Proposed Lending Guidelines: These are possible scenarios that may occur when considering making loans for bioscience or technology projects: 1. A loan made directly to a company whose trade or business consists solely of the developm ent or holding of intangibles for sale or license. Recommendation: PCDIC should not consider making loans. 2. A loan is made directly to a company that ge nerates its revenues fr om the manufacture of biomedical or technology products as well as the development or holding of intangibles for sale or license. Statutorily, the manufacturing activ ity must be the predominant business. One definition of predominantis much greater. Recommendation: PCDIC will consider making loans as long as the business is projected to m aintain revenues greater than 66% from non-licensing and intangible activity throughout the loan term. 3. A loan is made to a company that intends to use the loan to operate a hospital and/or related m edical services such as cancer testing and treatment or providing diagnostic care. Recommendation: PCDIC will consider funding loans. 4. A loan made to a developer or property owne r who leases space to a b ioscience or technology business whose primary business consists predom inantly of the development or holding of intangibles for sale or license. While the correctio ns to the Regulations reflect that this scenario may be allowable, the original Final Regulatio ns prohibited making loans to developers who leased spaced to businesses engaged in the develo pment or holding of intangibles for sale or license. Recommendation: In light of the recent change in Regulations, and the uncertainty in the area, staff recomm ends that PCDIC adopt a conserva tive approach by considering making loans only to such developers or property owners who reas onably project that they will lease to a tenant whose revenue generated from the development or holding of intangibles for sale or license is less than 40% of the total revenue generated from the business. This ratio must be pr ojected to be maintained throughout the life of the loan. (Note: PCDIC would make loans to developers or property owners who lease to a tenant whose re venue is generated entir ely from manufacturing activity.) Effective Date: PCDIC Board approved March 30, 2005. 60

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61Appendix E Community Impact Economic Assessme nt for the Bioscience / High-tech Industry Group This appendix provides further details about th e Community Im pact Economic Assessment that is explained in Section 7E of this report. In Table E1 we show the models estimates and forecasts of economic and fiscal metrics for all industries in Hillsborough County from 2001 to 2010. The Baseline Levels are in Panel A The baseline presumes no change in th e historical trend of industrial activity in the County. Then, in Panels B through F we forecast a revised picture for the Countys economic and fiscal metrics, if 100 jobs were recruited in 2007 for each of th e Bioscience / High-tech industry subsectors. The revised picture includes the multiplier effect of the added 100 jobs. In Panels B through F we also show the implied Employment Multipliers for each subsector.

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62 Table E1 Panel A Hillsborough County A ll Industries, Baseline Levels Year: 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Economic Impact metrics Output (Bil Fixed 2000$) 71.029 73.117 77.114 82.058 86.406 91.272 96.089 101.074 105.971 111.052 Total Emp (Thous) 746.422 754.486 758.943 778.076 797.851 817.748 838.400 858.543 878.061 897.778 Fiscal Impact metrics (Bil 2004$) State Revenues 3.476 3.614 3.776 3.920 4.080 4.235 4.395 Local Revenues 4.474 4.652 4.869 5.082 5.285 5.489 5.699State Expenditures 5.254 5.504 5.722 5.952 6.140 6.330 6.524Local Expenditures 5.120 5.343 5.536 5.743 5.913 6.083 6.258 Panel B Hillsborough County All Industries, New Levels after adding NAICS 325, Chemical Mfg, firm with 100 jobs in 2007 Year: 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Economic Impact metrics Output (Bil Fixed 2000$) 71.029 73.117 77.114 82.058 86.406 91.272 96.153 101.141 106.041 111.125 Total Emp (Thous) 746.422 754.486 758.943 778.076 797.851 817.748 838.673 858.827 878.350 898.068Employment Multiplier 2.73 2.84 2.89 2.90 Panel C Hillsborough County All Industries, Ne w Level s after adding NAICS 333, Machinery Mfg, firm with 100 jobs in 2007 Year: 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Economic Impact metrics Output (Bil Fixed 2000$) 71.029 73.117 77.114 82.058 86.406 91.272 96.124 101.111 106.010 111.093 Total Emp (Thous) 746.422 754.486 758.943 778.076 797.851 817.748 838.617 858.768 878.289 898.007Employment Multiplier 2.17 2.25 2.28 2.29

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63 Table E1 Panel D Hillsborough County All Industries, New Level s after adding NAICS 334, Comp & Elec Product Mfg, firm with 100 jobs in 2007 Year: 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Economic Impact metrics Output (Bil Fixed 2000$) 71.029 73.117 77.114 82.058 86.406 91.272 96.229 101.232 106.145 111.242 Total Emp (Thous) 746.422 754.486 758.943 778.076 797.851 817.748 838.825 858.994 878.528 898.252Employment Multiplier 4.25 4.51 4.67 4.74 Panel E Hillsborough County All Industries, New Levels after addi ng NAI CS 339, Miscellaneous Mfg, firm with 100 jobs in 2007 Year: 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Economic Impact metrics Output (Bil Fixed 2000$) 71.029 73.117 77.114 82.058 86.406 91.272 96.125 101.112 106.010 111.092 Total Emp (Thous) 746.422 754.486 758.943 778.076 797.851 817.748 838.642 858.793 878.314 898.031Employment Multiplier 2.42 2.50 2.53 2.53 Panel F Hillsborough County All Industries, New Level s after adding NAICS 541, Prof, Sci, & Tech Services, firm with 100 jobs in 200 7 Year: 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Economic Impact metrics Output (Bil Fixed 2000$) 71.029 73.117 77.114 82.058 86.406 91.272 96.096 101.081 105.978 111.059 Total Emp (Thous) 746.422 754.486 758.943 778.076 797.851 817.748 838.456 858.601 878.120 897.837Employment Multiplier 0.56 0.58 0.59 0.59

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64 Tables E2 through E6 show economic and fiscal activity for each of the Bioscience / High-tech industry subsectors. We measur e economic activity in terms of output and employment, both before the 100 new jobs (2001 to 2006) and after hypothetically adding the 100 new jobs (2007 to 2010). In the tables we describe the measures as Baseline Levels (before new jobs) and Diffe rence from Baseline (after new jobs). Additionally, we show the potential fiscal impacts of adding the 100 new jobs. Fiscal impacts are measured in terms of change s State and local revenues and expenses. Table E2 Hillsborough County Chemical Manufacturing, NAICS 325, Bas eline Levels Year: 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Economic Impact metrics Output (Bil Fixed 2000$) 0.654 0.664 0.709 0.742 0.758 0.793 0.817 0.841 0.863 0.885 Output (% of All Industries) 0.92% 0.91% 0.92% 0.90% 0.88% 0.87% 0.85% 0.83% 0.81% 0.80% Total Emp (Thous) 1.794 1.985 2.032 2.012 1.972 1.972 1.944 1.920 1.893 1.863 Total Emp (% of All Industries) 0.24% 0.26% 0.27% 0.26% 0.25% 0.24% 0.23% 0.22% 0.22% 0.21% Hillsborough County -Chemical Manufacturing, NAICS 325, Di fference from Baseline New Firm with 100 Employees Starting in 2007 Year: 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Economic Impact metrics Output (Bil Fixed 2000$) 0.03814 0.03965 0.04116 0.04275 Output (% of All Industries) 0.89% 0.87% 0.85% 0.83% Total Emp (Thous) 0.09058 0.09019 0.08982 0.08946 Total Emp (% of All Industries) 0.24% 0.23% 0.23% 0.22% Fiscal Impact metrics (Bil 2004$) State Revenues 0.001127 0.001213 0.001303 0.001375 Local Revenues 0.000833 0.000958 0.001092 0.001214 State Expenditures -0.000437 -0.000259 -0.000086 0.000079 Local Expenditures 0.000082 0.000212 0.000333 0.000441 Net Fiscal Impact 0.001605 0.002124 0.002642 0.003109

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65 Table E3 Hillsborough County Machinery Manufacturing, NAICS 333, Bas eline Levels Year: 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Economic Impact metrics Output (Bil Fixed 2000$) 0.280 0.262 0.188 0.198 0.205 0.215 0.220 0.228 0.234 0.238 Output (% of All Industries) 0.39% 0.36% 0.24% 0.24% 0.24% 0.24% 0.23% 0.23% 0.22% 0.21% Total Emp (Thous) 2.031 1.910 1.140 1.140 1.137 1.138 1.119 1.115 1.101 1.076 Total Emp (% of All Industries) 0.27% 0.25% 0.15% 0.15% 0.14% 0.14% 0.13% 0.13% 0.13% 0.12% Hillsborough County -Machinery Manufacturing, NAICS 333, Di fference from Baseline New Firm with 100 Employees Starting in 2007 Year: 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Economic Impact metrics Output (Bil Fixed 2000$) 0.01919 0.02002 0.02082 0.02169 Output (% of All Industries) 0.25% 0.25% 0.24% 0.23% Total Emp (Thous) 0.09743 0.09731 0.09724 0.09722 Total Emp (% of All Industries) 0.15% 0.14% 0.14% 0.13% Fiscal Impact metrics (Bil 2004$) State Revenues 0.000956 0.001016 0.001084 0.001140 Local Revenues 0.000694 0.000788 0.000890 0.000984 State Expenditures -0.000293 -0.000106 0.000065 0.000227 Local Expenditures 0.000096 0.000226 0.000342 0.000446 Net Fiscal Impact 0.001454 0.001924 0.002381 0.002797 Table E4 Hillsborough County Computer and Elec tronic Product Manufacturi ng, NAICS 334, Baseline Levels Year: 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Economic Impact metrics Output (Bil Fixed 2000$) 0.546 0.511 0.512 0.601 0.708 0.836 0.970 1.148 1.344 1.565 Output (% of All Industries) 0.77% 0.70% 0.66% 0.73% 0.82% 0.92% 1.01% 1.14% 1.27% 1.41% Total Emp (Thous) 2.144 1.860 1.439 1.151 1.061 1.038 1.032 1.072 1.120 1.176 Total Emp (% of All Industries) 0.29% 0.25% 0.19% 0.15% 0.13% 0.13% 0.12% 0.12% 0.13% 0.13% Hillsborough County Computer and Elec tronic Product Manufacturi ng, NAICS 334, Difference from Baseline New Firm with 100 Employees Starting in 2007 Year: 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Economic Impact metrics Output (Bil Fixed 2000$) 0.09366 0.1067 0.1194 0.1323 Output (% of All Industries) 1.11% 1.24% 1.38% 1.53% Total Emp (Thous) 0.09948 0.09928 0.09911 0.09896 Total Emp (% of All Industries) 0.13% 0.14% 0.14% 0.14% Fiscal Impact metrics (Bil 2004$) State Revenues 0.002302 0.002505 0.002701 0.002862 Local Revenues 0.001445 0.001680 0.001922 0.002141 State Expenditures -0.000589 -0.000239 0.000106 0.000444 Local Expenditures 0.000185 0.000448 0.000693 0.000920 Net Fiscal Impact 0.003343 0.004394 0.005423 0.006367

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66 Table E5 Hillsborough County Miscellaneous Manufacturing, NAICS 339, B aseline Levels Year: 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Economic Impact metrics Output (Bil Fixed 2000$) 0.192 0.142 0.171 0.176 0.183 0.190 0.198 0.205 0.211 0.217 Output (% of All Industries) 0.27% 0.19% 0.22% 0.21% 0.21% 0.21% 0.21% 0.20% 0.20% 0.20% Total Emp (Thous) 1.325 0.923 1.118 1.084 1.081 1.082 1.087 1.089 1.089 1.089 Total Emp (% of All Industries) 0.18% 0.12% 0.15% 0.14% 0.14% 0.13% 0.13% 0.13% 0.12% 0.12% Hillsborough County Miscellaneous Manufacturing, NAICS 339, Di fference from Baseline New Firm with 100 Employees Starting in 2007 Year: 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Economic Impact metrics Output (Bil Fixed 2000$) 0.01731 0.01788 0.0184 0.01892 Output (% of All Industries) 0.22% 0.22% 0.22% 0.21% Total Emp (Thous) 0.09485 0.09473 0.09464 0.09458 Total Emp (% of All Industries) 0.14% 0.14% 0.13% 0.13% Fiscal Impact metrics (Bil 2004$) State Revenues 0.001117 0.001172 0.001241 0.001295 Local Revenues 0.000899 0.001004 0.001123 0.001230 State Expenditures -0.000283 -0.000063 0.000139 0.000330 Local Expenditures 0.000122 0.000272 0.000408 0.000529 Net Fiscal Impact 0.001855 0.002385 0.002911 0.003384 Table E6 Hillsborough County Professional, Scientific and Technical Services, NAICS 541, B aseline Levels Year: 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Economic Impact metrics Output (Bil Fixed 2000$) 4.984 4.835 4.992 5.340 5.627 5.938 6.240 6.591 6.933 7.286 Output (% of All Industries) 7.02% 6.61% 6.47% 6.51% 6.51% 6.51% 6.49% 6.52% 6.54% 6.56% Total Emp (Thous) 52.886 50.305 49.887 51.169 52.326 53.517 54.715 56.242 57.728 59.224 Total Emp (% of All Industries) 7.09% 6.67% 6.57% 6.58% 6.56% 6.54% 6.53% 6.55% 6.57% 6.60% Hillsborough County Professional, Scientific and Technical Services, NAICS 541, Di fferences from Baseline New Firm with 100 Employees Starting in 2007 Year: 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Economic Impact metrics Output (Bil Fixed 2000$) 0.003743 0.003864 0.003976 0.004083 Output (% of All Industries) 6.50% 6.52% 6.55% 6.56% Total Emp (Thous) 0.03265 0.03268 0.0327 0.03269 Total Emp (% of All Industries) 6.53% 6.55% 6.58% 6.60% Fiscal Impact metrics (Bil 2004$) State Revenues 0.000167 0.000178 0.000194 0.000207 Local Revenues 0.000146 0.000168 0.000193 0.000217 State Expenditures -0.000059 0.000006 0.000066 0.000121 Local Expenditures 0.000037 0.000081 0.000120 0.000155 Net Fiscal Impact 0.000291 0.000434 0.000573 0.000700