Rep. Norm Thurston — Voting Record

Bill

Number

S.B. 223 First Substitute (2015GS)

Sponsor

Sen. Osmond, A.

Final action

Governor Signed 3/30/2015

Outcome

Became law — signed by Gov. Gary R. Herbert

Summary

What it does

• This bill:
• requires that prospective gubernatorial appointees to the Utah Science Technology and Research Governing Authority be approved by the Senate;
• gives the governor authority to remove a member of the Utah Science Technology and Research Governing Authority before a member's term is completed;
• modifies provisions of the technology outreach innovation program; and
• makes technical changes.

Every vote on this bill

Bill text

This document includes Senate Committee Amendments incorporated into the bill on Tue, Feb 24, 2015 at 9:13 AM by lpoole.
USTAR GOVERNANCE AMENDMENTS
GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Aaron Osmond
House Sponsor: 
 Rebecca P. Edwards
LONG TITLE
General Description:
This bill modifies provisions regarding the Utah Science Technology and Research
Governing Authority.
Highlighted Provisions:
This bill:
▸ requires that prospective gubernatorial appointees to the Utah Science Technology
and Research Governing Authority be approved by the Senate;
▸ gives the governor authority to remove a member of the Utah Science Technology
and Research Governing Authority before a member's term is completed;
▸ modifies provisions of the technology outreach innovation program; and
▸ makes technical changes.
Money Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
AMENDS:
63M-2-102
, as last amended by Laws of Utah 2014, Chapter 186
63M-2-202
, as last amended by Laws of Utah 2014, Chapter 186
63M-2-204
, as last amended by Laws of Utah 2014, Chapter 186
63M-2-301
, as last amended by Laws of Utah 2014, Chapter 186
63M-2-302
, as last amended by Laws of Utah 2014, Chapter 186
63M-2-401
, as enacted by Laws of Utah 2014, Chapter 186
63M-2-402
, as enacted by Laws of Utah 2014, Chapter 186
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 
63M-2-102
 is amended to read:
63M-2-102.
Definitions.
As used in this chapter:
(1) "Commercialization revenues" means dividends, realized capital gains, license fees,
royalty fees, and 
all
 other revenues received by a university as a result of commercial
applications
, inventions, or intellectual property
 developed from the USTAR initiative, less:
(a) the portion of [
those
] revenues allocated to the inventor; and
(b) expenditures incurred by the university to legally protect the intellectual property.
(2) "Executive director" means the person appointed [
by the governing authority
] under
Section 
63M-2-301
.
(3) "Research buildings" means any of the buildings listed in Section 
63M-2-201
.
(4) "Research universities" means the University of Utah and Utah State University.
(5) "Technology outreach 
innovation
 program" 
or "TOIP"
 means the program
described in Section 
63M-2-202
.
(6) "USTAR governing authority" means the Utah Science Technology and Research
Governing Authority created in Section 
63M-2-301
.
(7) (a) "USTAR initiative" means the Utah Science Technology and Research Initiative
created in Section 
63M-2-301
.
(b) "USTAR initiative" includes the projects, operations, activities, programs, and
services described in this chapter.
Section 2. Section 
63M-2-202
 is amended to read:
63M-2-202.
Technology outreach innovation program.
(1) As funding becomes available from the Legislature or other sources, the USTAR
governing authority shall establish a technology outreach 
innovation
 program
, also known as
the TOIP,
 at up to five locations distributed strategically throughout Utah.
(2) [
(a)
] The USTAR governing authority shall ensure that the technology 
innovation
outreach program acts as a resource to:
[
(i)
] 
(a)
 broker ideas, new technologies, and services to entrepreneurs and businesses
throughout a defined service area;
[
(ii)
] 
(b)
 engage local entrepreneurs and professors at applied technology centers,
colleges, and universities by connecting them to Utah's research universities;
[
(iii)
] 
(c)
 screen business ideas and new technologies to ensure that the ones with the
highest growth potential receive the most targeted services and attention;
[
(iv)
] 
(d)
 connect market ideas and technologies in new or existing businesses or
industries or in regional colleges and universities with the expertise of Utah's research
universities;
[
(v)
] 
(e)
 assist businesses, applied technology centers, colleges, and universities in
developing commercial applications for their research; and
[
(vi)
] 
(f)
 disseminate and share discoveries and technologies emanating from Utah's
research universities to local entrepreneurs, businesses, applied technology centers, colleges,
and universities.
[
(b)
] 
(3)
 In designing and operating the [
technology outreach program,
] 
TOIP, for each 
TOIP location
 the USTAR governing authority [
shall
]:
[
(i) for each technology outreach program location:
]
(a) may hire a TOIP director;
[
(A)
] 
(b) shall
 establish written performance standards and expectations [
for each
location
]; and
[
(B)
] 
(c) shall
 require reporting [
from each location
] related to those performance
standards and expectations on at least an annual basis[
; and
]
.
[
(ii) work cooperatively with the Technology Commercialization Offices at Utah State
University and the University of Utah.
]
(4) A TOIP director hired under Subsection (3) shall:
(a) be categorized as a schedule AC employee in accordance with Section 
67-19-15
;
(b) report to, and be supervised by, the executive director;
(c) ensure the TOIP serves to further the vision and mission of the USTAR initiative;
and
(d) as directed by the executive director, implement the policies and procedures
adopted by the USTAR governing authority.
Section 3. Section 
63M-2-204
 is amended to read:
63M-2-204.
Financial participation agreement.
(1) In consideration of the money and services provided or agreed to be provided, the
state of Utah, Utah State University, and the University of Utah agree that they will allocate
commercialization revenues as follows:
[
(a) for the first $15,000,000 received:
]
[
(i) $10,000,000 to Utah State University and the University of Utah, with the money
distributed proportionately based upon which university conducted the research that generated
the commercialization revenues; and
]
[
(ii) $5,000,000 to the USTAR governing authority for the ongoing operations of the
USTAR initiative; and
]
(a) for up to and including the first $15,000,000 in commercialization revenues
generated:
(i) 66.6% shall be retained by the research universities, with the money distributed
proportionably to the university that generated the commercialization revenue; and
(ii) 33.4% shall be paid to the USTAR governing authority for the ongoing operation
of the USTAR initiative;
(b) for all subsequent money received:
(i) 50% to Utah State University and the University of Utah, with the money
distributed proportionately based upon which university conducted the research that generated
the commercialization revenues; and
(ii) 50% to the USTAR governing authority or other entity designated by the state to be
used for:
(A) unless prohibited by law, deposit with the state treasurer for deposit into the
sinking fund created under Section 
63B-1a-301
 for debt service on the bonds issued to fund
planning, design, and construction of the research buildings;
(B) ongoing operations of the USTAR initiative;
(C) replacement of equipment in the research buildings;
(D) recruitment and funding of additional research teams; and
(E) construction of additional research buildings.
Section 4. Section 
63M-2-301
 is amended to read:
63M-2-301.
The Utah Science Technology and Research Initiative and the Utah
Science Technology and Research Governing Authority -- Creation -- Membership --
Meetings -- Staff.
(1) There is created the Utah Science Technology and Research Initiative.
(2) To oversee the Utah Science Technology and Research Initiative, there is created
the Utah Science Technology and Research Governing Authority consisting of the state
treasurer 
or the state treasurer's designee
, the executive director of the Governor's Office of
Economic Development, and the following eight members appointed as follows:
(a) three appointed by the governor
, with the consent of the Senate
;
(b) two appointed by the president of the Senate;
(c) two appointed by the speaker of the House of Representatives; and
(d) one appointed by the commissioner of higher education.
(3) (a) (i) The eight appointed members shall serve four-year staggered terms.
(ii) The appointed members may not serve more than two full consecutive terms.
(iii) An appointed member may be removed from the board for any reason before the
member's term is completed at the discretion of the governor after consultation with the
governing authority.
(b) Notwithstanding Subsection (3)(a)(i), the terms of the first members of the
governing authority shall be staggered by lot so that half of the initial members serve two-year
terms and half serve four-year terms.
(4) Vacancies in the appointed positions on the governing authority shall be filled by
the appointing authority [
with consent of the Senate
] 
in the same manner as the original
appointment
 for the unexpired term.
(5) (a) The governor, with the consent of the Senate, shall select the chair of the
governing authority to serve a one-year term.
(b) The executive director of the Governor's Office of Economic Development shall
serve as the vice chair of the governing authority.
(6) The governing authority shall meet at least monthly and may meet more frequently
at the request of a majority of the members of the governing authority.
(7) Five members of the governing authority are a quorum.
(8) A member may not receive compensation or benefits for the member's service, but
may receive per diem and travel expenses as allowed in:
(a) Section 
63A-3-106
;
(b) Section 
63A-3-107
; and
(c) rules made by the Division of Finance according to Sections 
63A-3-106
 and
63A-3-107
.
(9) (a) After consultation with the USTAR governing authority, the governor, with the
consent of the Senate, shall appoint a full-time executive director to provide staff support for
the USTAR governing authority.
(b) The executive director is an at-will employee who may be terminated without cause
by the governor 
Ŝ→ [
[
] 
 or 
 [
]
, by the Senate, or
] ←Ŝ
by majority vote of the USTAR governing
163a authority.
Section 5. Section 
63M-2-302
 is amended to read:
63M-2-302.
USTAR governing authority powers.
(1) The USTAR governing authority shall:
(a) ensure that funds appropriated and received for research and development at the
research universities and for the [
technology outreach program
] 
TOIP
 are used appropriately,
effectively, and efficiently in accordance with the intent of the Legislature;
(b) in cooperation with the universities' administrations, expand key research at the two
research universities;
(c) enhance technology transfer and commercialization of research and technologies
developed at the research universities to create high-quality jobs and new industries in the
private sector in Utah;
(d) review state and local economic development plans and appropriations to ensure
that the USTAR initiative and its appropriations do not duplicate existing or planned programs;
(e) establish written economic development objectives for the USTAR initiative that
are measurable and verifiable, including how to maximize revenue to the USTAR initiative so
that it becomes financially self-supporting;
(f) by following the procedures and requirements of Title 63G, Chapter 3, Utah
Administrative Rulemaking Act, make rules for allocating appropriated money for research
teams and for the commercialization of new technology between Utah State University and the
University of Utah;
(g) verify that the USTAR initiative is being enhanced by research grants and that it is
meeting the governing authority's economic development objectives;
(h) monitor all research plans that are part of the USTAR initiative at the research
universities to determine that appropriations are being spent in accordance with legislative
intent and to maximize the benefit and return to the state; and
(i) develop methods and incentives to encourage investment in and contributions to the
USTAR initiative from the private sector.
(2) The USTAR governing authority may:
(a) in addition to money received from the Legislature, receive contributions for the
USTAR initiative from any source in the form of money, property, labor, or other things of
value;
(b) subject to any restrictions imposed by the donation, appropriations, or bond
authorizations, allocate money received by it among the research universities, technology
outreach program, and technology transfer offices to support commercialization and technology
transfer to the private sector; or
(c) enter into agreements necessary to obtain private equity investment in the USTAR
initiative.
Section 6. Section 
63M-2-401
 is amended to read:
63M-2-401.
Reporting requirements.
(1) By October 1 of each year, the USTAR governing authority shall submit to the
governor; the Legislature; the Business, Economic Development, and Labor Appropriations
Subcommittee; and the Economic Development and Workforce Services Interim Committee an
annual written report of the operations, activities, programs, and services of the governing
authority and the USTAR initiative for the preceding fiscal year.
(2) For each project, operation, activity, program, or service related to the USTAR
initiative or overseen or funded through the USTAR governing authority, the annual report
shall include:
(a) a description of the project, operation, activity, program, or service;
(b) data selected and used by the governing authority to measure progress,
performance, and scope of the project, operation, activity, program, or service, including
summary data;
(c) a clear description of the methodology for any data in the report that includes an
estimation;
(d) the amount and source of all USTAR initiative funding, including:
(i) funding from legislative appropriations;
(ii) funding procured outside of legislative appropriations, including a separate
accounting of grants or investments contributing to research teams and other activities of the
USTAR initiative from the federal government, private entities, or other sources, and an
explanation of the extent to which:
(A) outside funding was contingent on or leveraged by legislative appropriations; and
(B) outside funding would continue if legislative appropriations were discontinued;
(iii) commercialization revenue, including a separate accounting of:
(A) realized commercialization revenue;
(B) unrealized [
and expected
] commercialization revenue; and
(C) commercialization revenue going to other parties attributable to USTAR initiative
funding;
(iv) lease revenue from each building in which the USTAR governing authority holds
title; and
(v) the amount of money deposited with the state treasurer for deposit into the sinking
fund created under Section 
63B-1a-301
 for debt service on the bonds issued to fund planning,
design, and construction of the research buildings;
(e) all expenses of the USTAR initiative, including:
(i) operational expenses;
(ii) for each employee receiving compensation from USTAR initiative funding,
compensation information, including:
(A) salary expenses, benefit expenses, and travel expenses;
(B) information for each research team employee and each employee of the
[
technology outreach program
] 
TOIP
 that receives compensation directly or indirectly through
USTAR initiative funding; and
(C) information regarding compensation for each employee from sources other than
USTAR initiative funding, including grants and compensation from a university or private
entity;
(iii) for each research team, salary expenses, benefit expenses, travel expenses, and
operations and maintenance expenses;
(iv) operational and maintenance expenses for each building in which the USTAR
governing authority holds title;
(v) operational and maintenance expenses paid for by USTAR initiative funding for
each location that has an established [
technology outreach program
] 
TOIP
; and
(vi) each grant or other incentive given as a result of the USTAR initiative, including
grants or incentives awarded through the [
technology outreach program
] 
TOIP
;
(f) the number of jobs and the corresponding salary ranges created by the USTAR
initiative, including the number of jobs where the employee is expected to be employed for at
least one year and earns at least 125% of the prevailing wage of the county where the employee
works;
(g) the name of each business entity receiving a grant or other incentive as a result of
the USTAR initiative, including the outreach program;
(h) a list of business entities that have hired employees as a result of the USTAR
initiative;
(i) the tax revenue generated as a result of the USTAR initiative, with actual revenue
generated clearly separated from potential revenue;
(j) a list of intellectual property assets, including patents, generated by research teams
as a result of the USTAR initiative, including a reasonable estimate of the USTAR initiative's
percentage share of potential commercialization revenue that may be realized from those
assets;
(k) a description of any agreements entered into regarding private equity investment in
the USTAR initiative;
(l) beginning with data from the fiscal year beginning July 1, 2013, historical data from
previous years for comparison with the annual data reported under this Subsection (2);
(m) goals, challenges, and achievements related to the project, operation, activity,
program, or service;
(n) relevant federal and state statutory references and requirements;
(o) contact information of officials knowledgeable and responsible for each project,
operation, activity, program, or service;
(p) other information determined by the USTAR governing authority that:
(i) may be needed, useful, or of historical significance; or
(ii) promotes accountability and transparency for each project, operation, activity,
program, or service with the public and with elected officials;
(q) the written economic development objectives required under Subsection
63M-2-302
(1)(e) and a description of any progress or challenges in meeting the objectives; and
(r) the audit report described in Section 
63M-2-402
.
(3) The annual report shall be designed to provide clear, accurate, and accessible
information to the public, the governor, and the Legislature.
(4) The governing authority shall:
(a) submit the annual report in accordance with Section 
68-3-14
; and
(b) make the annual report and previous annual reports accessible to the public by
placing a link to the reports on the USTAR initiative's website.
(5) In addition to the annual written report described in this section:
(a) upon the request of a committee, the USTAR governing authority shall provide
information and progress reports to the Economic Development and Workforce Services
Interim Committee; the Business and Labor Interim Committee; and the Business, Economic
Development, and Labor Appropriations Subcommittee; and
(b) on or before October 1, 2019, and every five years after October 1, 2019, the
USTAR governing authority shall include with the annual report described in this section a
written analysis and recommendations concerning the usefulness of the information required in
the annual report and the ongoing effectiveness of the USTAR initiative, including whether:
(i) the reporting requirements are effective at measuring the performance of the
USTAR initiative;
(ii) the reporting requirements should be modified; and
(iii) the USTAR initiative is beneficial to the state and should continue.
Section 7. Section 
63M-2-402
 is amended to read:
63M-2-402.
Audit requirements.
(1) Each fiscal year, an audit of the activities of the USTAR initiative shall be made as
described in this section.
(2) (a) As approved by the Legislative Audit Subcommittee, the audit shall be
conducted by:
(i) the legislative auditor; or
(ii) an independent auditor engaged by the legislative auditor.
(b) An independent auditor used under Subsection (2)(a)(ii) may not have a [
business
or contractual connection, or other connection,
] 
direct financial conflict of interest
 with the
USTAR initiative or the USTAR governing authority.
(3) The USTAR governing authority shall pay the costs associated with the annual
audit.
(4) The annual audit shall:
(a) include a verification of the accuracy of the information required to be included in
the annual report described in Section 
63M-2-401
; and
(b) be completed by September 1 of each year.
Legislative Review Note
 as of 2-17-15 2:52 PM
Office of Legislative Research and General Counsel