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STATE OF OKLAHOMA
2nd Session of the 58th Legislature (2022)
COMMITTEE SUBSTITUTE
FOR
HOUSE BILL NO. 4354 By: Hill
COMMITTEE SUBSTITUTE
[ economic development - Oklahoma Research and
Development Attraction Act - Oklahoma Center for
the Advancement of Science and Technology -
effective date ]
BE IT ENACTED BY THE PEOPL E OF THE STATE OF OKLAHOMA:
SECTION 1. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 5003.10f of Title 74, unless
there is created a duplication in numbering, reads as follows:
This act shall be known and may be cited as the "Oklahoma
Research and Development Attraction Act".
SECTION 2. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 5003.10g of Title 74, unless
there is created a duplication in numbering, reads as follows:
A. The Oklahoma Center for the Advancement o f Science and
Technology ("OCAST") shall create a Research and Development
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Attraction Grants Progra m ("Program"), to be administered in
accordance with this section for the purpose of fostering research
and development in key industry cl usters, leading to the creation of
new products and services that are brought to market by Oklahoma-
based companies, or brought to market by companies financially
sponsored by an Oklahom a-based capital provider and which conduct a
substantial portion of total business activity in the State of
Oklahoma.
B. OCAST may award matching funds to eligible businesses to
offset a portion of expenses incurred through a collaborative
research and development project engagement with an Oklahoma
institution of highe r education or nonprofit research institution.
C. OCAST may award matching funds up to fifty percent (50%) of
the cost of the project, not to exceed One Hundred Thousand Dollars
($100,000.00). A business may receive only one matching grant under
this section per year.
D. In order to be eligible for matching funds under this
section, a business must satisfy all of the following conditions:
1. The business must be an Oklahoma-based small business. For
the purposes of this section, "Oklahoma-based" means a business that
has its principal place of business in this state or a business that
has, in the preceding twelve (12) mon ths, raised an equity round not
less than Five Hundred Thousand Dollars ($500,000.00) with an
Oklahoma-based capital provider investing n ot less than ten percent
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(10%) of such equity round, that commits to spend all eligible
Program funds in the State of O klahoma, and that has filed a
certificate of qualification with the Oklahoma Secretary of State.
For the purposes of this section "small business" means a business
entity that employs not more than one hundred (100) persons;
2. In accordance with the O klahoma Office of Science and
Innovation's 2021-2026 strategic plan, the business must operate in
one of the state's three strategic industry cluster s, including
aerospace and autonomous systems, life sciences, and energy
diversification;
3. The research and development service provider which partners
with the business must be an Oklahoma-based research entity. For
the purposes of this section, "Oklahoma-based research entity" means
an institution of higher education or another nonprofit organization
that primarily provides research services, and which has its main
physical campus in this state. For the purposes of this section,
"research services" means research and development, technology
exploration, technical development, product development, and
commercialization intended to foster innovation in eligible small
businesses;
4. The research and development project for which matching
funds are provided must be conducted physically within the State of
Oklahoma, for the duration of the engagement with the Ok lahoma-based
research entity; and
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5. To be awarded matching funds under the Program , an Oklahoma-
based small business must file an applicatio n with OCAST, attesting
to the total cost of the proj ect and demonstrating available and
unrestricted private capi tal to meet at least fifty percent (50%) of
the total project cost. Matching funds may be used only to purchase
research services, as defined in this section, from an Oklahoma -
based research entity.
E. When administering the Program under this section, OCAST
shall select eligible projects to qualify for matching funds within
the Research and Development Attraction Act based on factors
including, but not limited to:
1. The amount of private capital the matching funds will induce
to be spent in Oklahoma;
2. The total market size of the Oklahoma -based small
businesses' product or service offering;
3. Third-party validation of the Oklahoma -based small
businesses' intellectual assets, including but not limited to equity
raised from venture capital or private equity firms, federal
commercialization grants t hrough the Small Business Innovation
Research or Small Business Technology Trans fer programs, or
competitive federal research awards through National Institutes of
Health, National Science Foundation, Department of Defense,
Department of Energy, and others;
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4. The projected future job creation impact of the Oklahoma-
based small business for the state;
5. Other economic benefits to the state, including through
increased state and local revenues and growth in private investment;
6. The need of the Oklahoma-based small business to acquire
specialized services and resources in Oklahoma;
7. The alignment of the project within Oklahoma 's identified
cluster strategies; and
8. The impact on Oklahoma-based research entities, including
through increased revenue, exposure to new technologies, and
increased attraction opportunities for students, researchers, and
professional staff.
SECTION 3. NEW LAW A new section of law to be codified
in the Oklahoma Statutes as Section 5003.10h of Title 74, unless
there is created a duplication in numbering, reads as follows:
OCAST shall promulgate rules to enforce the provisions of the
Research and Development Attraction Grants Program, including the
following:
1. The application process for applying for matching funds;
2. The criteria to be used by OCAST to evaluate matching funds
applications from Oklahoma -based small businesses, and to determi ne
the amount of the award;
3. The evaluation metrics which will be gathered to report
efficacy of this pilot program back to the State of Ok lahoma, which
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may include, but will not be limited to, volume of applications,
technological diversity of c ompanies taking up the Program, the
success of Oklahoma-based small businesses at raising follow-on
capital rounds or advancing in technological readiness level (TRL),
and follow-on capital spent in the state and at Oklahoma -based
research entities; and
4. The agreements that Oklahoma-based small businesses must
enter into, in regard to claiming matching funds and to ensur e
compliance in spending of matching funds.
SECTION 4. This act shall become effective November 1, 2022.
58-2-10958 JM 03/02/22