Transcript Slide 1

Keeping Virginia’s
Competitive Edge
Small Business Legislative Update
The Impact On Entrepreneurs
Josh Levi
Vice President of Policy
October 13, 2010
[email protected] | www.nvtc.org
Who We Are
The Northern Virginia Technology Council Is
The Membership And Trade Association For
The Technology Community In Northern
Virginia And Is The Largest Technology
Council In The Nation.
Our Membership Companies
NVTC Members Are From All Sectors Of
The Technology Industry Including:
 Aerospace
 Internet
 Bioinformatics
 Modeling and Simulation
 Biotech/Life Sciences
 Nanotechnology
 Cyber Security
 Professional Services/
 Data Centers
Government Contracts
 Education IT
 Semiconductors
 Green IT
 Software
 Health IT
 Systems Integration
 Information Technology
 Telecommunications
Size Of Technology Member
Companies
2%
4%
5%
4%
6%
50%
26%
1 to 9
10 to 74
75 to 149
250 to 499
500 to 999
1000+
By Number Of Employees In Region
150 to 249
 Launched In 2004
 Educational Programs
 Mentoring And Advising Opportunities
 Networking Events And Activities
 Online Guidance And Resources
 For More Information Contact Kristin D’Amore At
[email protected]
NVTC Public Policy Advocacy

Focus Since 1991
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Membership Driven
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Centered On Tech Industry Needs/Concerns
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Emphasis On Commonwealth Of Virginia

Successes Thrust Virginia Into Broad Technology
Leadership Position
Commonwealth Of Virginia
Supports And Promotes Business
 Highly Educated Workforce
 World Class Colleges And Universities
 Low Tax State
 Attractive Regulatory Environment
 Right To Work
 Reliable And Affordable Energy
 Access To Ports And International Airport
 Well Managed State/AAA Bond Rating
 Open To Innovative Public-Private Partnerships
Virginia As National Business Leader
 Named The “Best State For Business” By Forbes Four Years In A
Row (2006-2009)
 Ranked America's “Top State For Business” By CNBC (2007 And
2009); Took The No. 2 Spot In 2008 And 2010
 Ranked “No. 1 Pro-Business State” By Pollina Corporate Real Estate
Inc. (2003, 2007, 2009 And 2010)
 Ranked The Second “Best State For Business” By Directorship
Magazine (2009)
 Ranked The Second “Best State To Start A Business” By U.S. News
And World Report (2009)
 Ranked The Second “Top Overall Growth Performer” By The
United States Chamber Of Commerce, "Enterprising States: Creating
Jobs, Economic Development, And Prosperity In Challenging Times”
(2010)
Virginia As A National Technology
Business Leader
Private Sector Statistics
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1st In Concentration Of High-Tech Workers
2nd For Entrepreneurs Starting Businesses
2nd For Total Federal Procurement
2nd For Fastest Growing Firms
3rd In High-Tech Services
4th For Economic Development For Nanotechnology
4th In Engineering Services Employment
5th In Number Of High-Tech Workers
5th For High-Tech Payroll
5th In High-Tech Employment Growth
6th For High-Tech Average Wages
6th For Number Of High-Tech Firms
Sources: 2008 State New Economy Index, National Science Foundation, Cyberstates 2009 And 2010, Lux
Research, U.S. Census Bureau, U.S. News & World Report, Federal Procurement Data System
Technology In Virginia's Economy
2009Q2 VA
Employment
2009Q2 VA
Wages
31%
16%
84%
69%
Total Employment:
3,558,351
Total Wages: $41.68b
High-Tech Employment:
585,051
All Industries
High-Tech Wages: $13.04b
High - Tech
Source: CHMURA Economics & Analysis, Virginia Economic Trends, 1st Quarter 2010 Report
Technology In Northern Virginia's
Economy
2009Q2 NOVA
Employment
2009Q2 NOVA
Wages
45%
27%
73%
55%
Total Employment:
1,239,569
Total Wages: $19,134,180
High-Tech Employment:
331,183
All Industries
High-Tech Wages: $8,608,377
High - Tech
Source: CHMURA Economics & Analysis, Virginia Economic Trends, 1st Quarter 2010 Report
Virginia Supports And Promotes
Technology Business
 Aggressive Computer Crimes Laws
 Broadband Deployment Policies And Investments
 Commercial Law To Support E-Commerce
 Early Leader In E-Government
 Legacy Of Rejecting Internet Sales And Services Taxes
 State Investments To Build Research Capacity
 Telework Promotion
 Technology Procurement
 Technology Tax Policy And Incentives
Dual Emphasis Economic
Development Strategy Is Key
 Emphasis 1: Enhance Tools To Attract Companies Seeking To
Relocate, Expand, Establish R&D Operations
 Doubled Governor’s Opportunity Fund
 $6M To Expand International Marketing Efforts
 Lower Threshold For Major Business Facility Tax Credit
 Increase Worker Training Incentives
 Bolster Department Of Business Assistance Program Activity
 State Industrial Mega-Site Fund
 Green Jobs Tax Credit
Dual Emphasis Economic
Development Strategy Is Key
 Emphasis 2: Employ Comprehensive “Grow Your
Own”/New Company Formation Strategy
 Position Virginia As:
 A Leader In Next-Generation Tech
Company Formation And Innovation
 Top Destination For Entrepreneurs, Early
Stage Investors, Innovators
Dual Emphasis Economic
Development Strategy Is Key
Emphasis 2: Employ Comprehensive “Grow Your
Own”/New Company Formation Strategy
Recent Policies Help Promote Virginia As A Top
Destination For Innovation, Entrepreneurs And Small
Technology Companies
 100% Capital Gains Tax Exemption For
Technology Investments
 CIT Early Stage GAP Fund
 VA Angel Investor Technology Tax Credits
 VA One Stop Business Permitting Portal
Strongly Promote Virginia As A Top
Destination For Innovation And
Technology Startups
 Capital Gains Tax Exclusion
 100% Capital Gains Tax Exclusion For Founders And
Investors In Qualifying Tech Startups
 3 Year Window
 Targeted Toward Statewide Technology, Biotechnology,
Energy Companies
 Entrepreneurs And Investors Can Come To Virginia To Start
And Invest In Early Stage Tech Companies Over The Next
Three Years With No Long Term Capital Gains Tax Liability
Promote Virginia As A Top
Destination For Innovation,
Entrepreneurs And Small Technology
Companies
 CIT/GAP Fund
 $1.5M In Additional Funding To Bolster CIT’s Early Stage
GAP Fund
 Early Stage Fund To Underwrite Critical And Immediate
First Financing For High Growth, High Expectation Early
Stage Companies
 Targeted Toward Statewide Technology, Biotechnology,
Energy Startups
 Public-Private Partnerships Model
 CIT Does Due Diligence And Validates Science And
Technology
 Drives Private Sector Capital Investment At A Rate Of
13x Public Outlay
Strongly Promote Virginia As A Top
Destination For Innovation,
Entrepreneurs And Small Technology
Companies
 Angel Investor Tax Credit
 Encourage And Leverage Early Stage Investments In
Technology Startups
 Targeted Toward Statewide Technology, Biotechnology,
Energy Startups
 50% Of Qualified Business Investments, Up To $50,000 Credit
Per Investor
 For Calendar Year 2010, Funding For The Program Was
Increased From $3M To $5M
Small, Women- And Minority-Owned
Businesses In Virginia
 1975: Virginia Opened Its First Minority Business Office
 1980s: Agencies Began Establishing Goals For Minority
Business Spending
 2003: A Study Commissioned By Governor Warner Found
That Less Than One-Half Of One Percent (< 0.5%) Of State
Contracts In Virginia Were Directed Towards Minority
Owned Businesses
Small, Women- And Minority-Owned
Businesses In Virginia
 2005: Governor Warner Called For The State To Direct
40% Of Its Goods And Services Needs To SWaM Businesses
In Executive Order 103
 2006: Governor Kaine Signed Executive Order 33 Expanding
The Commonwealth’s Efforts To Enhance Opportunities For
SWaM Businesses
 Spring 2008: The Commonwealth Reached 40% Goal And
Number Of SWaM Certified Businesses Up From 4,000
(2006) To 15,800
 August 2010: Governor McDonnell Created The Governor’s
Supplier Diversity Advisory Board To Revitalize Procurement
Policy, Expand Opportunities To SWaM Businesses
Doing Business With VITA
 Before A Business Can Participate In VITA's IT Procurement
Activities As A SWaM Certified Business, It Must:
 Obtain Certification As A SWaM Business From
The Department Of Minority Business Enterprise
(DMBE).
http://www.dmbe.virginia.gov/swamcert.html
 Register With eVA As A Vendor
eVA Is Virginia's Online Procurement Initiative. Current
And Potential Suppliers Of IT Products And Services To
The Commonwealth Of Virginia Must Register With eVA,
At www.eva.virginia.gov.
Impact Of Defense Secretary Gates’
Announced DoD Cuts On Virginia
Deltek: Clarity Advisor
 Cuts Will Hit Federal Professional, Administrative and Management
Support Services (PAMS)
 The Government Spent $73.3B In The PAMS Category In FY2009
 DoD Spent $45.9B In The PAMS Category In FY2009
 $10.8B Went To Contracts Performed In Virginia
 $3.8B Went To Contracts Performed In California
Source: CLARITY Advisor, Special Report On DoD Funding Cuts, Deltek, Inc.
Impact Of Defense Secretary Gates’
Announced DoD Cuts On Virginia
Deltek: Clarity Advisor
 10% Cut Would Cost Firms Working In Virginia At Least
$1.1B In FY2011 (≈ 11,000 Jobs)
 10% Cuts In FY2012, FY2013 To Follow
 Will Impact:
 Firms Holding DoD Contracts Funded From
Federal Supply Group (PAMS)
 Subcontractors Working For Those Firms
 Suppliers To Both
 At Least 200 Firms Receive 90% Or More Of Their Prime Contract
Funding From This One Category
Source: CLARITY Advisor, Special Report On DoD Funding Cuts, Deltek, Inc.
Keeping Virginia’s
Competitive Edge
Small Business Legislative Update
The Impact on Entrepreneurs
Josh Levi
Vice President of Policy
October 13, 2010
[email protected] | www.nvtc.org