Legislative Assembly HOUSE BILL NO. 1333
of North Dakota
Representatives Nathe, Howe, Lefor, Mock, Sanford
Senators Bekkedahl, Cook
1 A BILL for an Act to create and enact a new chapter to title 54 of the North Dakota Century
2 Code, relating to the creation of a legacy innovation fund to support technology advancement
3 committee and grant program; to provide an exemption; to provide a continuing appropriation;
4 and to provide an appropriation.
5 BE IT ENACTED BY THE LEGISLATIVE ASSEMBLY OF NORTH DAKOTA:
6 SECTION 1. A new chapter to title 54 of the North Dakota Century Code is created and
7 enacted as follows:
9 In this chapter, unless the context otherwise requires:
10 1. "Commissioner" means the commissioner of the department of commerce.
11 2. "Committee" means the legacy innovation fund to support technology advancement
13 3. "Department" means the department of commerce.
14 4. "Diversification sectors" means the following industries:
15 a. Advanced computing and data management;
16 b. Agriculture technology;
17 c. Autonomous and unmanned vehicles and related technologies;
18 d. Energy;
19 e. Health care;
20 f. Value-added agriculture;
21 g. Value-added energy; and
22 h. Any industry or area specifically identified by the committee as an industry that
23 will contribute to the diversification of the state's economy.
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1 Legacy innovation fund to support technology advancement committee -
2 Membership - Meetings.
3 1. The legacy innovation fund to support technology advancement committee consists of:
4 a. The president of the bank of North Dakota or the president's designee who shall
5 serve as the chairperson of the committee and is a nonvoting member of the
7 b. Three members, representing active venture capital firms, who must be
8 appointed by the president of the Bank of North Dakota;
9 c. One member with finance-related experience, knowledge, or education, who
10 must be appointed by the president of the Bank of North Dakota; and
11 d. Three members from the private sector with expertise in the diversification
12 sectors, who must be appointed by the commissioner.
13 2. The term of office of the appointed members of the committee is four years, and the
14 terms must be staggered so that no more than one of the members' terms appointed
15 by the president of the Bank of North Dakota and one of the members' terms
16 appointed by the commissioner expire each year. Each term of office commences on
17 the first day of July. Members serve at the pleasure of the appointing entity and may
18 be reappointed for additional terms. Members of the committee may not invest or
19 otherwise participate in applied research, experimentation, or operational testing
20 associated with a grant awarded under this chapter. The committee shall select a
21 vice-chairperson. If a committee member ceases to qualify as a member of the
22 appointing entity, that individual's membership on the committee ceases immediately
23 and the appointing entity shall appoint a new member to the committee for the
24 remainder of the term.
25 3. A committee member representing the private sector is eligible to receive
26 compensation in an amount not exceeding one hundred thirty-five dollars per day and
27 travel and expense reimbursement as provided by law for state officers for attending
28 meetings of the committee.
29 4. The committee shall meet as necessary to make grant award determinations, direct
30 the distribution of funds, and provide ongoing review of research, development, and
31 commercialization activities.
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1 Legacy innovation fund to support technology advancement - Legacy innovation
2 technology grant program.
3 The department shall administer the legacy innovation technology grant program to provide
4 grants for activities identified in this chapter. The department shall provide administrative
5 support for the program, including the drafting of application forms, receiving applications,
6 reviewing applications for completeness and compliance with committee policy, and forwarding
7 complete applications to the committee in accordance with the guidelines established by the
8 committee. Program guidelines relating to ownership of intellectual property, inventions, and
9 discoveries must address activities and issues unique to technologies, patents, and companies
10 created as a result of a legacy innovation technology grant.
11 Legacy innovation technology grants - Eligibility.
12 1. The committee shall establish guidelines for entities to qualify for a legacy innovation
13 technology grant under this section. The committee shall consider and process
14 applications in a timely manner that does not jeopardize an applicant's opportunity to
15 leverage other funds.
16 2. In determining whether to approve or disapprove an application, the committee shall
17 consider the extent to which the proposal will:
18 a. Deliver applied research, experimentation, or operational testing in one or more
19 of the diversification sectors to create information or data to enhance North
20 Dakota companies or industries or companies making investments in North
22 b. Lead to the commercialization or patent of a legacy innovation technology
23 solution; or
24 c. Result in the development of a new company or expansion of an existing
25 company that will diversify the state's economy through new products,
26 investment, or skilled jobs.
27 Legacy innovation fund to support technology advancement - Continuing
29 The legacy innovation fund to support technology advancement is a special fund in the
30 state treasury and must be administered by the Bank of North Dakota. All moneys in the fund
31 are appropriated to the Bank of North Dakota on a continuing basis for the purpose of providing
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1 legacy innovation fund to support technology advancement grants and for administrative
2 expenses. Interest earned on moneys in the fund must be credited to the fund.
3 Use of funds - Terms of funds - Distribution of funds.
4 Grant recipients shall use legacy innovation technology grant funds to enhance capacity
5 and, to the extent possible, leverage state, federal, and private sources of funding. An entity
6 awarded funds under this chapter may not use the funds for capital or building investments or
7 for research or other activities not identified in this chapter. The funds may not be used for
8 academic or instructive programming, workforce training, administrative costs, or to supplant
9 funding for regular operations of institutions of higher education. Unless otherwise approved by
10 the committee, grant recipients may use funding only to conduct applied research,
11 experimentation, or operational testing within the state. If an entity awarded a grant no longer
12 conducts its activities in the state, the grant recipient shall return all funding received.
13 Legacy innovation fund to support technology advancement - Postaward
14 monitoring - Exemption.
15 1. Upon completion of work performed from funding provided by a grant, the Bank of
16 North Dakota shall provide an independent review of the results. Evaluation criteria
17 may include:
18 a. How the work performed has contributed to the development of a company or the
19 expansion of an existing company, has enhanced the ability of a company to
20 make investments in the state, or otherwise enticed a company to invest or move
21 to the state.
22 b. How the work performed has led to additional economic investment of capital
23 from public and private sector entities within and outside North Dakota.
24 c. How the work performed has led to or may lead to a patent or research that is
25 commercially viable.
26 2. As a condition for receipt of funds under this chapter, each entity shall agree to provide
27 the department with an annual audit on all funds distributed under this chapter.
28 3. Entities receiving a grant under this chapter are exempt from the requirements of
29 section 54-60.1-05.
30 SECTION 2. APPROPRIATION - TRANSFER TO LEGACY INNOVATION FUND TO
31 SUPPORT TECHNOLOGY ADVANCEMENT - INTENT. There is appropriated out of any
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1 moneys in the general fund in the state treasury, not otherwise appropriated, the sum of
2 $25,000,000, or so much of the sum as may be necessary, which the office of management and
3 budget shall transfer to the legacy innovation fund to support technology advancement during
4 the biennium beginning July 1, 2019, and ending June 30, 2021. It is the intent of the legislative
5 assembly that the funds transferred be derived from legacy fund earnings transferred to the
6 general fund.
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