AB129,37,7 7239.01 Definitions. In this chapter, except as otherwise provided:

AB129,37,8 8(1) "Authority" means the Wisconsin Venture Capital Authority.

AB129,37,9 9(2) "Board" means the board of directors of the authority.

AB129,37,12 10239.02 Creation and organization of authority. (1) There is created a
11public body corporate and politic to be known as the "Wisconsin Venture Capital
12Authority." The members of the board shall consist of the following:

AB129,37,1413 (a) The chief executive officer of the Wisconsin Economic Development
14Corporation.

AB129,37,1715 (b) Four persons from the private sector, at least 3 of whom shall have venture
16capital, investment banking, or substantial entrepreneurial experience, nominated
17by the governor and appointed with the advice and consent of the senate.

AB129,37,1918 (c) One member appointed by the speaker of the assembly who shall have
19venture capital, investment banking, or substantial entrepreneurial experience.

AB129,37,2120 (d) One member appointed by the senate majority leader who shall have
21venture capital, investment banking, or substantial entrepreneurial experience.

AB129,37,23 22(2) The members of the board appointed by the governor, the speaker of the
23assembly, and the senate majority leader shall serve 3-year terms.

AB129,38,2 24(3) A majority of the members of the board constitutes a quorum for the purpose
25of conducting its business and exercising its powers and for all other purposes,

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1notwithstanding the existence of any vacancies. Action may be taken by the board
2upon a vote of a majority of the members present.

AB129,38,4 3(4) A vacancy on the board shall be filled in the same manner as the original
4appointment to the board for the remainder of the unexpired term, if any.

AB129,38,7 5(5) A member of the board may not be compensated for the member's services
6but shall be reimbursed for actual and necessary expenses, including travel
7expenses, incurred in the performance of the member's duties.

AB129,38,11 8(6) No cause of action may arise against and no civil liability may be imposed
9upon a member of the board for any act or omission in the performance of the
10member's powers and duties under this chapter, unless the person asserting liability
11proves that the act or omission constitutes willful misconduct.

AB129,38,13 12(7) Annually, the governor shall appoint one member as chairperson of the
13board.

AB129,38,18 14(8) The board may hire an executive director. The board may delegate to the
15executive director or any other employee of the authority any powers or duties the
16board considers proper. All powers and duties assigned to the authority under this
17chapter shall be exercised or carried out by the board, unless the board delegates the
18power or duty to an employee of the authority.

AB129,38,22 19239.03 Powers of authority. The authority shall have all the powers
20necessary or convenient to carry out the purposes and provisions of this chapter. In
21addition to all other powers granted the authority under this chapter, the authority
22may specifically:

AB129,38,24 23(1) Adopt, amend, and repeal any bylaws, policies, and procedures for the
24regulation of its affairs and the conduct of its business.

AB129,38,25 25(2) Have a seal and alter the seal at pleasure.

AB129,39,1

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1(3) Maintain an office.

AB129,39,2 2(4) Sue and be sued.

AB129,39,4 3(5) Accept gifts, grants, loans, or other contributions from private or public
4sources.

AB129,39,6 5(6) Establish the annual budget of the authority and monitor its fiscal
6management.

AB129,39,9 7(7) Execute contracts and other instruments required for the operation of the
8authority, including contracts with the Wisconsin Economic Development
9Corporation.

AB129,39,11 10(8) Employ any officers, agents, and employees that it may require and
11determine their qualifications, duties, and compensation.

AB129,39,12 12(9) Issue notes, bonds, and any other obligations.

AB129,39,13 13(10) Make loans and provide grants.

AB129,39,14 14(11) Incur debt.

AB129,39,15 15(12) Procure liability insurance.

AB129,39,19 16239.04 Liability limited. Neither the state nor any political subdivision of
17the state, nor any officer, employee, or agent of the state or a political subdivision of
18the state who is acting within the scope of employment or agency, is liable for any
19debt, obligation, act, or omission of the authority.

AB129,39,23 20239.05 Annual report. Annually, the authority shall submit to the chief clerk
21of each house of the legislature, for distribution to the legislature under s. 13.172 (2),
22and to the governor, a report on the programs administered by the authority that
23includes all of the following:

AB129,39,25 24(1) General reporting requirements. For each program administered by the
25authority, the report shall include all of the following:

AB129,40,1

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1(a) An assessment of the program's success to date.

AB129,40,32 (b) An accounting of the financial status of the program, including the opinion
3of an independent certified public accountant.

AB129,40,44 (c) Any recommendations the authority has for improvement of the program.

AB129,40,7 5(2) Badger jobs fund. In addition to the information provided under sub. (1),
6the authority's annual report shall include all of the following for the badger jobs
7fund administered by the authority under subch. II:

AB129,40,88 (a) The current investment policy of the badger jobs fund.

AB129,40,109 (b) The badger jobs fund's internal rate of return from its investments in
10certified investors.

AB129,40,1211 (c) An accounting of the revenue received by the authority under s. 73.033 (1)
12(b).

AB129,40,1413 (d) An accounting of any compensation, including a management fee, paid to
14the fund manager during the preceding year.

AB129,40,1815 (e) An accounting of the value of tax credits awarded to creditors of the badger
16jobs fund under s. 239.14 during the preceding year, including a description of the
17circumstances leading to the award of the credits and the likelihood that the
18authority will award additional tax credits to fund creditors in the future.

AB129,40,2119 (f) For each certified investor in whom the badger jobs fund invested capital
20under s. 239.13 (2) during the preceding year, the name and address of the investor
21and the amount of each investment.

AB129,40,2222 (g) The internal rate of return realized by each certified investor.

AB129,40,2423 (h) An accounting of any fee each certified investor paid to itself or any principal
24or manager of the certified investor during the preceding year.

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1(i) For each business in which a certified investor held an investment of capital
2from the badger jobs fund during the preceding year, the name and address of the
3business and a description of the nature of the business; the amount of each
4investment in the business; an identification of the certified investor who made the
5investment; and a statement of the number of employees the business employed
6when the certified investor first invested in the business and the number of
7employees the business employed on December 31 of the preceding year.

AB129,41,10 8(3) Certified jobs now fund program. In addition to the information provided
9under sub. (1), the authority's annual report shall include all of the following for the
10certified jobs now fund program under subch. III:

AB129,41,1111 (a) The information required under s. 239.25 (2).

AB129,41,1312 (b) An accounting of the value of each tax credit the authority awarded under
13s. 239.22 (2) during the preceding year.

AB129,41,1514 (c) An accounting of the revenue received by the authority under s. 73.033 (2)
15(b).

AB129,41,1716 (d) An accounting of each profit sharing fee paid to the authority under s.
17239.24 (2) during the preceding year.

AB129,41,2018 (e) A list of certified jobs now funds that the authority decertified under s.
19239.26 (2) during the preceding year and a description of the circumstances leading
20to each decertification.

AB129,41,23 23239.10 Definitions. In this subchapter:

AB129,41,24 24(1) "Certified investor" means a person certified under s. 239.12.

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1(2) "Fund creditor" means any holder of a note or bond of the authority under
2this subchapter.

AB129,42,5 3(3) "Debt service obligation" means the authority's obligation, including any
4payment schedule, to pay principal and interest or other financing costs to a creditor
5on a note or bond the authority issues under this subchapter.

AB129,42,6 6(4) "Fund" means the badger jobs fund.

AB129,42,12 7239.11 Creation of fund; management. (1) Fund purpose. There is created
8a fund to be known as the "badger jobs fund" for the investment of capital in certified
9investors. The legislature finds that the fund will provide capital for business growth
10and job creation in this state that is currently not sufficiently available in private
11financial markets and that the fund will result in increased tax revenues to the state
12and serve a public purpose.

AB129,42,14 13(2) Bonding; debt service. (a) The authority may issue, by resolution, up to
14$200,000,000 in negotiable bonds or notes of any kind to finance the fund.

AB129,42,1815 (b) The state is not liable for a debt service obligation of the authority. The
16authority's debt is not a debt of the state, and the authority may not create a debt of
17the state. Each note or bond of the authority shall contain on its face a statement
18to that effect.

AB129,42,2219 (c) Recognizing its moral obligation to do so, the legislature hereby expresses
20its expectation and aspiration that, if ever called upon to do so, it shall make an
21appropriation to pay a fund creditor the amount the authority fails to pay or
22otherwise satisfy under its debt service obligation to that creditor.

AB129,43,223 (d) Neither the members of the board nor any person executing the notes or
24bonds is liable personally on the notes or bonds or subject to any personal liability

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1or accountability by reason of the issuance of the notes or bonds, unless the personal
2liability or accountability is the result of willful misconduct.

AB129,43,18 3(3) Notice regarding bond limit; dissolution of the fund. (a) The chairperson
4of the board shall promptly notify the joint committee on finance in writing when the
5authority has reached its bond limit under sub. (2) (a) and has satisfied 90 percent
6of its total debt service obligation to fund creditors. Once the authority satisfies 100
7percent of its total debt service obligation to fund creditors, the chairperson of the
8board shall promptly provide a 2nd notice to the joint committee on finance stating
9that the authority has satisfied 100 percent of its total debt service obligation to fund
10creditors and that the authority intends to dissolve the fund. If, within 14 working
11days after the date of that 2nd notice, the cochairpersons of the committee do not
12notify the authority that the committee has scheduled a meeting to review
13dissolution of the fund, the authority shall dissolve the fund and liquidate all of the
14fund's assets and pay the proceeds of that liquidation to the secretary of
15administration for deposit in the general fund. If, within 14 working days after the
16date of that 2nd notice, the cochairpersons of the committee notify the authority that
17the committee has scheduled a meeting to review dissolution of the fund, the
18authority may dissolve the fund only upon approval of the committee.

AB129,44,219 (b) The authority may reinvest amounts that it receives as returns from its
20investments in certified investors only if the authority has reached the bond limit
21under sub. (2) (a), the authority has satisfied 100 percent of its total debt service
22obligation to fund creditors, and the joint committee on finance schedules a meeting
23to consider dissolution of the fund under par. (a) but does not approve dissolution of
24the fund. Any reinvestment by the authority under this paragraph shall meet the

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1requirements under this subchapter with respect to the authority's investments in
2certified investors.

AB129,44,53 (c) If the authority dissolves the fund under par. (a), the authority shall pay to
4the secretary of administration for deposit in the general fund any additional
5amounts the authority receives from certified investors after the fund is dissolved.

AB129,44,13 6(4) Fund manager. (a) The authority shall hire a fund manager who has
7expertise in the venture capital or private equity asset class to manage the fund's
8investment of capital in certified investors. In reviewing candidates for fund
9manager, the authority shall consider a candidate's venture capital or private equity
10asset class experience, investment philosophy, and the performance of any
11investments in the venture capital asset class managed by the candidate, as well as
12any other criteria the authority considers relevant. The fund manager may not be
13a certified investor.

AB129,44,1714 (b) The authority may pay the fund manager an annual management fee. That
15management fee may not equal more than 0.5 percent of the fund's total assets
16including amount of capital that the authority has raised, committed to, or invested
17in, certified investors.

AB129,44,21 18239.12 Investor certification. (1) Application. Any person may apply to the
19authority on a form prescribed by the authority for certification under this section.
20The application shall include the name, address, and tax identification number of the
21person and any other information the authority requires.

AB129,44,24 22(2) Certification. The authority may certify an applicant who submits an
23application under sub. (1) to receive fund capital for investment. In determining
24whether to certify an applicant, the authority shall consider:

AB129,45,2

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1(a) The applicant's venture capital experience or other experience that qualifies
2the applicant to receive fund capital.

AB129,45,33 (b) The past performance of investments managed by the applicant.

AB129,45,44 (c) The applicant's commitment to investing in businesses within this state.

AB129,45,65 (d) The applicant's commitment to making seed or early stage business
6investments.

AB129,45,87 (e) Whether the applicant is located in this state or will locate and maintain an
8office in this state as a condition of the applicant's certification under this section.

AB129,45,109 (f) Any other factors the authority considers relevant that are consistent with
10the authorities responsibilities under this subchapter.

AB129,45,12 11(3) Application fee. An applicant for certification under sub. (1) shall pay to
12the authority a fee in the amount determined by the authority.

AB129,45,17 13239.13 Investment of capital in certified investors; requirements. (1)
14Investment policy. The fund manager shall establish, and amend as appropriate,
15a fund investment policy. The authority shall review and approve the investment
16policy prior to the policy's implementation and shall review the policy and any
17amendments at least annually thereafter.

AB129,45,21 18(2) Fund investments. The authority may invest capital under this subchapter
19only in certified investors. The authority may not commit more than 15 percent of
20the total capital that the authority is authorized to raise under s. 239.11 (2) (a) to a
21single certified investor.

AB129,45,25 22(3) Contracts. Before the authority invests any capital in a certified investor,
23the authority shall contract with the certified investor, and in addition to any other
24terms required or negotiated by the authority, that contract shall include the
25following requirements:

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1(a) The certified investor shall commit to maintaining a significant physical
2presence in this state, including locating an office in this state that is staffed with
3at least one full-time employee of the certified investor.

AB129,46,74 (b) The certified investor shall invest at least 50 percent of the amount of capital
5the certified investor receives from the fund in a business that meets all of the
6following conditions at the time the certified investor first invests in the business
7under this section:

AB129,46,88 1. Is headquartered in this state.

AB129,46,109 2. Employs at least 50 percent of its employees, including any subsidiary or
10other affiliated entity, in this state.

AB129,46,1311 3. Agrees to use fund capital only for research and development, the
12introduction of a new product in the market, the business's entry into a new market,
13or other activities that are expected to grow the business and create jobs in this state.

AB129,46,1614 4. Is not primarily engaged in real estate development or sales, insurance,
15banking, lending, lobbying, political consulting, professional services, or retail sales,
16other than direct sales of products the business itself manufactures.

AB129,46,1817 (c) The certified investor may not receive capital from the fund that exceeds 25
18percent of the total capital the investor has raised from all sources.

AB129,46,2119 (d) When a certified investor makes an investment of fund capital in a business,
20the certified investor shall at least match the fund's capital contribution to that
21investment with capital the certified investor has raised from other sources.