Composition and general operation
Board of directors
Under the substitute amendment, a 13-member board of directors (board)
governs the authority. The board consists of a chairperson nominated by the
governor who serves at the pleasure of the governor; the chief executive officer of the
Wisconsin Economic Development Corporation or his or her designee; seven
members with substantial equity investment or angel or early stage seed investment
experience, nominated by the executive director of the State of Wisconsin Investment
Board (SWIB) and appointed with the advice and consent of the senate; two members
appointed by the speaker of the assembly, consisting of one majority and one minority
party representative to the assembly; and two members appointed by the senate
majority leader, consisting of one majority and one minority party senator. Each of
the members of the board nominated by the executive director of SWIB serves a
staggered six-year term and may not be an officer, director, or other principal in an
equity investment firm. Members of the board may not be compensated but may be
reimbursed for actual and necessary expenses, including travel expenses, incurred
in the performance of their duties. The substitute amendment requires that the
governor, the executive director of SWIB, the speaker of the assembly, and the senate
majority leader attempt to appoint the initial members of the board within 60 days
after the effective date of the substitute amendment.
The substitute amendment gives the board the powers necessary or convenient
to carry out its duties, as well as specific powers to conduct its corporate business.
Under the substitute amendment, the authority is a participating employer in the
Wisconsin Retirement System. The board may hire an executive director. The
members of the board nominated by the executive director of SWIB; the executive
director of the authority, if any; and the fund manager of the Wisconsin forward jobs
fund administered by the authority are subject to state ethics laws.
Wisconsin forward jobs fund
The substitute amendment establishes the Wisconsin forward jobs fund, which
is a separate nonlapsible trust fund. Under the substitute amendment, in each fiscal
year, beginning in fiscal year 2013–14, and ending in fiscal year 2018–19, the
secretary of administration must transfer moneys to the Wisconsin forward jobs fund
from the general fund totaling $208,000,000. Under the substitute amendment, the
authority, based upon the recommendation of a selection committee appointed by the
executive director of SWIB, must hire a qualified fund manager to manage the
Wisconsin forward jobs fund. The substitute amendment directs the authority to
delegate powers to the fund manager necessary for the fund manager's
administration of the Wisconsin forward jobs fund and the investment programs
created in the substitute amendment.
Qualified investment capital funds
Under the substitute amendment, the authority may approve a qualified
investment capital fund to receive fund capital. Under the substitute amendment,
fund capital consists of moneys in or received from the Wisconsin forward jobs fund.
In determining whether to approve an applicant as a qualified investment capital
fund, the authority must consider the applicant's investment experience, the past
performance of investments managed by the applicant, the applicant's commitment
to investing in businesses located in Wisconsin, and the applicant's commitment to
making investments that are diverse with respect to a business's geographic location
in this state and industry classification.
Under the substitute amendment, the authority may invest fund capital in
qualified investment capital funds. The authority may not commit more than
$15,000,000 to a single qualified investment capital fund. The authority must
ensure that an amount equal to 100 percent of the fund capital it invests in qualified
investment capital funds, or at least $180,000,000 over the life of the Wisconsin
forward jobs fund, is invested by those investment capital funds in businesses that
are headquartered in this state and that at least $170,000,000 in fund capital is
invested in businesses that meet the following additional conditions:
1. Employ at least half of their full-time employees in Wisconsin.
2. Employ fewer than 150 full-time employees in total.
3. Agree to use fund capital only for research and development, the
introduction of a new product in the market, entry into a new market, or other
activities that are expected to grow the businesses and create jobs in Wisconsin.
4. Are not primarily engaged in real estate development or sales, insurance,
banking, lending, lobbying, political consulting, professional services, or retail sales,
other than the direct sales of products a business itself manufactures.
The substitute amendment provides that a qualified investment capital fund
must contract with the authority before receiving any fund capital. In the contract,
the qualified investment capital fund must agree to a number of conditions,
including the following:
1. The qualified investment capital fund must commit to maintaining a
significant physical presence in Wisconsin, including an office that is staffed by at
least one full-time employee.
2. Within four years after the qualified investment capital fund receives a
commitment of fund capital from the authority, the qualified investment capital fund
must have an amount equal to 100 percent of that fund capital either invested in or
held in reserve for follow-on investments in businesses that are approved by the
authority.
3. Unless the qualified investment capital fund is a Wisconsin-based qualified
investment capital fund, as determined by the authority, the qualified investment
capital fund may not receive fund capital that exceeds 20 percent of the total capital
the investment capital fund has raised from all sources. A Wisconsin-based
qualified investment capital fund may not receive fund capital that exceeds 50
percent of the total amount of capital the Wisconsin-based qualified investment
capital fund has received from all sources.
4. The authority's profit-sharing agreement with a qualified investment
capital fund must be on terms that are substantially equivalent to the terms enjoyed
for similar investments by other funding sources of the qualified investment capital
fund.
5. From any investment of fund capital by a qualified investment capital fund,
the qualified investment capital fund may not pay a fee to itself or to any principal
or manager of the qualified investment capital fund that is greater than the average
fee the investment capital fund earns on its other investments or equals more than
2.5 percent of the total amount of fund capital contributed to that investment by the
authority.
6. The qualified investment capital fund must disclose to the authority any
interest that it holds in a business in which the qualified investment capital fund
invests or intends to invest fund capital.
Angel investor networks
Additionally, the substitute amendment authorizes the authority to invest fund
capital directly in a Wisconsin business if that investment is proposed to the
authority by an angel investor or angel group of angel investors (angel investor
network). The authority may commit up to a total of $20,000,000 in fund capital to
such investments if the business in which the investment is made is a Wisconsin
business, the angel investor network agrees to invest at least $2 for every $1 in fund
capital that the authority commits to the investment, and the authority's
profit-sharing agreement with the angel investor network is comparable to the
terms enjoyed by other persons in the angel investor network with respect to the
investment. Under the substitute amendment the authority must attempt to ensure
that its investments in businesses suggested by angel investors or networks are
made in businesses that operate in economically distressed areas.
Qualified business development organizations
Under the substitute amendment, the authority may commit up to $8,000,000
in fund capital to qualified business development organizations. The authority may
approve a person as a qualified business development organization if the authority
determines that the person operates a nonprofit or for-profit business incubator,
regional economic development partnership, local economic development
organization, or non-profit or for-profit entrepreneurial service agency that directly
provides certain business support and other services to start-up businesses.
Under the substitute amendment, a qualified business development
organization is subject to contract requirements similar to those applicable for
qualified investment capital funds. Among other contract requirements, the
qualified business development organization must invest fund capital in a business
the qualified business development organization itself serves through its business
development programs. Also, a qualified business development organization must
at least match the amount of moneys it receives from the Wisconsin forward jobs fund
with an investment of capital in the business that the qualified business
development organization has raised from other sources. The authority must
attempt to ensure that qualified business development organizations invest fund
capital in businesses that operate in economically distressed areas.
Reporting requirements
Under the substitute amendment, the authority must submit an annual report
to the legislature and the governor that contains all of the following information:
1. An accounting of the financial status of the Wisconsin forward jobs fund,
including the opinion of an independent certified public accountant.
2. The current investment policy of the Wisconsin forward jobs fund.
3. The authority's internal rate of return from its investments of fund capital.
4. For each qualified investment capital fund in which the authority held an
investment of fund capital during the preceding year, the name and address of the
investment capital fund; the amount of fund capital invested with each qualified
investment capital fund; the internal rate of return realized by the qualified
investment capital fund on each investment; and an accounting of any fee the
qualified investment capital fund paid to itself or any principal or manager of the
qualified investment capital fund during the preceding year.
5. For each business in which a qualified investment capital fund held an
investment of fund capital during the preceding year, the name and address of the
business; a description of the nature of the business; the amount of each investment
of fund capital in the business and the amount contributed to that investment by the
qualified investment capital fund; an identification of the qualified investment
capital fund that made the investment; and a statement of the number of employees
the business employed when the qualified investment capital fund first invested
fund capital in the business, the number of employees the business employed on
January 1 of the preceding year, and the number of employees the business employed
on December 31 of the preceding year.
6. For each investment held by the authority with an angel investor network
in a business during the preceding year, the name and address of the business; a
description of the nature of the business; an identification of the angel investor
network; the amount of the investment and the amount contributed to the
investment by the angel investor network; and a statement of the number of
employees the business employed when the authority first invested fund capital in
the business, the number of employees the business employed on January 1 of the
preceding year, and the number of employees the business employed on December
31 of the preceding year.
7. With respect to grants to qualified business development organizations, an
accounting of the total amount of moneys the authority granted to qualified business
development organizations during the preceding year and the name and address of
each qualified business development organization and the amount of each grant. For
each business in which a qualified business development organization held an
investment of grant moneys during the preceding year, the name and address of the
business; a description of the nature of the business; an identification of the qualified
business development organization that made the investment; the total amount of
each investment in the business and the amount contributed to that investment by
the qualified business development organization or by other funding sources; and a
statement of the number of employees the business employed when the qualified
business development organization first invested grant moneys in the business, the
number of employees the business employed on January 1 of the preceding year, and
the number of employees the business employed on December 31 of the preceding
year.
The substitute amendment also requires the authority to submit a report to the
Joint Committee on Finance in January 2018 that includes all of the following:
1. A comprehensive assessment of the performance to date of the Wisconsin
forward jobs fund and the programs administered by the authority concerning the
Wisconsin forward jobs fund.
2. Any recommendations the authority has for improvement of the programs
administered by the authority concerning the Wisconsin forward jobs fund and the
specific actions the authority intends to take or proposes to be taken to implement
those recommendations.
3. Any recommendations SWIB has for improvement of the programs
administered by the authority concerning the Wisconsin forward jobs fund and the
specific actions SWIB proposes to be taken to implement those recommendations.
Winding up of the investment programs
In December 2031, the authority must liquidate all of its assets, including its
remaining investments, related to the Wisconsin forward jobs fund and pay the
proceeds of that liquidation to the secretary of administration for deposit into the
general fund, except that the authority must use 25 percent of the amount of that
liquidation that exceeds $208,000,000 for an economic development program that
serves economically distressed areas in Wisconsin. After the authority liquidates
those assets, makes that payment, transfers any tangible personal property to the
Department of Administration, and assigns any contracts to the secretary of
administration, the authority may not conduct any more business concerning the
Wisconsin forward jobs fund.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
AB181-SSA1,1
1Section
1. 1.12 (1) (b) of the statutes is amended to read:
AB181-SSA1,7,22
1.12
(1) (b) "State agency" means an office, department, agency, institution of
3higher education, the legislature, a legislative service agency, the courts, a judicial
4branch agency, an association, society, or other body in state government that is
5created or authorized to be created by the constitution or by law, for which
6appropriations are made by law, excluding the Health Insurance Risk-Sharing Plan
1Authority
and, the Wisconsin Economic Development Corporation
, and the
2Wisconsin Venture Capital Authority.
AB181-SSA1,2
3Section
2. 13.172 (1) of the statutes is amended to read:
AB181-SSA1,7,94
13.172
(1) In this section, "agency" means an office, department, agency,
5institution of higher education, association, society, or other body in state
6government created or authorized to be created by the constitution or any law, that
7is entitled to expend moneys appropriated by law, including the legislature and the
8courts, and any authority created in subch. II of ch. 114 or subch. III of ch. 149 or in
9ch. 231, 233, 234, 238,
239, or 279.
AB181-SSA1,3
10Section
3. 13.48 (13) (a) of the statutes is amended to read:
AB181-SSA1,7,2311
13.48
(13) (a) Except as provided in par. (b) or (c), every building, structure or
12facility that is constructed for the benefit of or use of the state, any state agency,
13board, commission or department, the University of Wisconsin Hospitals and Clinics
14Authority, the Fox River Navigational System Authority, the Wisconsin Economic
15Development Corporation,
the Wisconsin Venture Capital Authority, or any local
16professional baseball park district created under subch. III of ch. 229 if the
17construction is undertaken by the department of administration on behalf of the
18district, shall be in compliance with all applicable state laws, rules, codes and
19regulations but the construction is not subject to the ordinances or regulations of the
20municipality in which the construction takes place except zoning, including without
21limitation because of enumeration ordinances or regulations relating to materials
22used, permits, supervision of construction or installation, payment of permit fees, or
23other restrictions.
AB181-SSA1,4
24Section
4. 13.62 (2) of the statutes is amended to read:
AB181-SSA1,8,5
113.62
(2) "Agency" means any board, commission, department, office, society,
2institution of higher education, council, or committee in the state government, or any
3authority created in subch. II of ch. 114 or subch. III of ch. 149 or in ch. 231, 232, 233,
4234, 237, 238,
239, or 279, except that the term does not include a council or
5committee of the legislature.
AB181-SSA1,5
6Section
5. 13.94 (1) (dx) of the statutes is created to read:
AB181-SSA1,8,117
13.94
(1) (dx) Biennially, beginning in 2013, conduct a financial audit of the
8Wisconsin Venture Capital Authority and a program evaluation audit of the
9programs administered by the Wisconsin Venture Capital Authority under ch. 239.
10The legislative audit bureau shall file a copy of each audit report under this
11paragraph with the distributees specified in par. (b).
AB181-SSA1,6
12Section
6. 13.94 (1s) (c) 9. of the statutes is created to read:
AB181-SSA1,8,1413
13.94
(1s) (c) 9. The Wisconsin Venture Capital Authority for the cost of the
14audit required to be performed under sub. (1) (dx).
AB181-SSA1,7
15Section
7. 13.94 (4) (a) 1. of the statutes is amended to read:
AB181-SSA1,9,716
13.94
(4) (a) 1. Every state department, board, examining board, affiliated
17credentialing board, commission, independent agency, council or office in the
18executive branch of state government; all bodies created by the legislature in the
19legislative or judicial branch of state government; any public body corporate and
20politic created by the legislature including specifically the Fox River Navigational
21System Authority, the Lower Fox River Remediation Authority, the Wisconsin
22Aerospace Authority,
and the Wisconsin Economic Development Corporation,
and
23the Wisconsin Venture Capital Authority, a professional baseball park district, a
24local professional football stadium district, a local cultural arts district
, and a
25long-term care district under s. 46.2895; every Wisconsin works agency under subch.
1III of ch. 49; every provider of medical assistance under subch. IV of ch. 49; technical
2college district boards; every county department under s. 51.42 or 51.437; every
3nonprofit corporation or cooperative or unincorporated cooperative association to
4which moneys are specifically appropriated by state law; and every corporation,
5institution, association or other organization which receives more than 50% of its
6annual budget from appropriations made by state law, including subgrantee or
7subcontractor recipients of such funds.
AB181-SSA1,8
8Section
8. 13.95 (intro.) of the statutes is amended to read:
AB181-SSA1,9,22
913.95 Legislative fiscal bureau. (intro.) There is created a bureau to be
10known as the "Legislative Fiscal Bureau" headed by a director. The fiscal bureau
11shall be strictly nonpartisan and shall at all times observe the confidential nature
12of the research requests received by it; however, with the prior approval of the
13requester in each instance, the bureau may duplicate the results of its research for
14distribution. Subject to s. 230.35 (4) (a) and (f), the director or the director's
15designated employees shall at all times, with or without notice, have access to all
16state agencies, the University of Wisconsin Hospitals and Clinics Authority, the
17Wisconsin Aerospace Authority, the Health Insurance Risk-Sharing Plan Authority,
18the Lower Fox River Remediation Authority, the Wisconsin Economic Development
19Corporation,
the Wisconsin Venture Capital Authority, and the Fox River
20Navigational System Authority, and to any books, records, or other documents
21maintained by such agencies or authorities and relating to their expenditures,
22revenues, operations, and structure.
AB181-SSA1,9
23Section
9. 16.002 (2) of the statutes is amended to read:
AB181-SSA1,9,2524
16.002
(2) "Departments" means constitutional offices, departments, and
25independent agencies and includes all societies, associations, and other agencies of
1state government for which appropriations are made by law, but not including
2authorities created in subch. II of ch. 114 or subch. III of ch. 149 or in ch. 231, 232,
3233, 234, 237, 238,
239, or 279.
AB181-SSA1,10
4Section
10. 16.004 (4) of the statutes is amended to read:
AB181-SSA1,10,105
16.004
(4) Freedom of access. The secretary and such employees of the
6department as the secretary designates may enter into the offices of state agencies
7and authorities created under subch. II of ch. 114 and subch. III of ch. 149 and under
8chs. 231, 233, 234, 237, 238,
239, and 279, and may examine their books and accounts
9and any other matter that in the secretary's judgment should be examined and may
10interrogate the agency's employees publicly or privately relative thereto.
AB181-SSA1,11
11Section
11. 16.004 (5) of the statutes is amended to read:
AB181-SSA1,10,1612
16.004
(5) Agencies and employees to cooperate. All state agencies and
13authorities created under subch. II of ch. 114 and subch. III of ch. 149 and under chs.
14231, 233, 234, 237, 238,
239, and 279, and their officers and employees, shall
15cooperate with the secretary and shall comply with every request of the secretary
16relating to his or her functions.
AB181-SSA1,12
17Section
12. 16.004 (12) (a) of the statutes is amended to read:
AB181-SSA1,11,218
16.004
(12) (a) In this subsection, "state agency" means an association,
19authority, board, department, commission, independent agency, institution, office,
20society, or other body in state government created or authorized to be created by the
21constitution or any law, including the legislature, the office of the governor, and the
22courts, but excluding the University of Wisconsin Hospitals and Clinics Authority,
23the Wisconsin Aerospace Authority, the Health Insurance Risk-Sharing Plan
24Authority, the Lower Fox River Remediation Authority, the Wisconsin Economic
1Development Corporation,
the Wisconsin Venture Capital Authority, and the Fox
2River Navigational System Authority.
AB181-SSA1,13
3Section
13. 16.015 of the statutes is created to read:
AB181-SSA1,11,6
416.015 Administrative support; Wisconsin Venture Capital Authority. 5The department shall provide administrative support services to the Wisconsin
6Venture Capital Authority.
AB181-SSA1,14
7Section
14. 16.045 (1) (a) of the statutes is amended to read:
AB181-SSA1,11,138
16.045
(1) (a) "Agency" means an office, department, independent agency,
9institution of higher education, association, society, or other body in state
10government created or authorized to be created by the constitution or any law, that
11is entitled to expend moneys appropriated by law, including the legislature and the
12courts, but not including an authority created in subch. II of ch. 114 or subch. III of
13ch. 149 or in ch. 231, 232, 233, 234, 237, 238,
239, or 279.
AB181-SSA1,15
14Section
15. 16.15 (1) (ab) of the statutes is amended to read:
AB181-SSA1,11,1915
16.15
(1) (ab) "Authority" has the meaning given under s. 16.70 (2), but
16excludes the University of Wisconsin Hospitals and Clinics Authority, the Lower Fox
17River Remediation Authority, the Wisconsin Economic Development Corporation,
18the Wisconsin Venture Capital Authority, and the Health Insurance Risk-Sharing
19Plan Authority.
AB181-SSA1,16
20Section
16. 16.41 (4) of the statutes is amended to read:
AB181-SSA1,11,2221
16.41
(4) In this section, "authority" means a body created under subch. II of
22ch. 114 or subch. III of ch. 149 or under ch. 231, 233, 234, 237, 238,
239, or 279.
AB181-SSA1,17
23Section
17
. 16.417 (1) (b) of the statutes is amended to read:
AB181-SSA1,11,2524
16.417
(1) (b) "Authority" means a body created under subch. II of ch. 114 or
25ch. 231, 232, 233, 234, 237, 238,
239, or 279.
AB181-SSA1,18
1Section
18. 16.5195 of the statutes is created to read:
AB181-SSA1,12,4
216.5195 Transfers to the Wisconsin forward jobs fund. The secretary
3shall transfer the following amounts from the general fund to the Wisconsin forward
4jobs fund:
AB181-SSA1,12,5
5(1) In fiscal year 2013-14, $25,000,000.
AB181-SSA1,12,6
6(2) In fiscal year 2014-15, $43,000,000.
AB181-SSA1,12,7
7(3) In fiscal year 2015-16, $50,000,000.
AB181-SSA1,12,8
8(4) In fiscal year 2016-17, $50,000,000.
AB181-SSA1,12,9
9(5) In fiscal year 2017-18, $20,000,000.
AB181-SSA1,12,10
10(6) In fiscal year 2018-19, $20,000,000.
AB181-SSA1,19
11Section
19. 16.52 (7) of the statutes is amended to read:
AB181-SSA1,12,2212
16.52
(7) Petty cash account. With the approval of the secretary, each agency
13that is authorized to maintain a contingent fund under s. 20.920 may establish a
14petty cash account from its contingent fund. The procedure for operation and
15maintenance of petty cash accounts and the character of expenditures therefrom
16shall be prescribed by the secretary. In this subsection, "agency" means an office,
17department, independent agency, institution of higher education, association,
18society, or other body in state government created or authorized to be created by the
19constitution or any law, that is entitled to expend moneys appropriated by law,
20including the legislature and the courts, but not including an authority created in
21subch. II of ch. 114 or subch. III of ch. 149 or in ch. 231, 233, 234, 237, 238,
239, or
22279.
AB181-SSA1,20
23Section
20. 16.528 (1) (a) of the statutes is amended to read:
AB181-SSA1,13,424
16.528
(1) (a) "Agency" means an office, department, independent agency,
25institution of higher education, association, society, or other body in state
1government created or authorized to be created by the constitution or any law, that
2is entitled to expend moneys appropriated by law, including the legislature and the
3courts, but not including an authority created in subch. II of ch. 114 or subch. III of
4ch. 149 or in ch. 231, 233, 234, 237, 238,
239, or 279.
AB181-SSA1,21
5Section
21. 16.53 (2) of the statutes is amended to read: