Start-up businesses—particularly those in the technology and biotechnology sectors—face steep hurdles when bringing new products and innovations to market. These early-stage companies often require multiple rounds of funding and significant capital investment before reaching profitability. While Pennsylvania is fortunate to be home to many of these promising ventures, we lose far too many to states with more favorable investment climates and tax policies.

To help retain and grow these companies, we will be introducing companion legislation to Representative Friel & Representative Fritz’s House Bill 1129. This legislation would allow qualifying start-ups to sell their unused net operating losses and research and development (R&D) tax credits to unrelated companies. This model is based on a successful New Jersey program and would enable start-ups to convert losses and tax assets into much-needed working capital.

The funds raised through these sales would be required to be reinvested in Pennsylvania-based operations, helping companies scale their workforce, expand production, and continue innovating. This bill provides a critical source of non-dilutive capital during the most vulnerable phase of a start-up’s life cycle and is a smart investment in the Commonwealth’s economic future.

Supporting our innovation economy will foster the creation of high-quality jobs and position PA as a competitive home for next-generation businesses. We hope you will join us in co-sponsoring this effort to keep Pennsylvania at the forefront of innovation and job creation.