The Commonwealth’s 2010 fiscal budget, which just passed through the House and Senate, slashes funding for the Massachusetts Life Science Investment Fund by 60 percent.
It’s the second set of proposed cuts for the quasi-public agency, which is charged with nurturing the states life science industry. Its original $25 million annual budget allotment in the Life Science Investment Act passed last year.
The act, billed as a 10-year, $1 billion initiative, is actually four different funding pools, most consisting of tax breaks for infrastructure improvements and capital spending. But there’s a $25 million annual discretionary fund the center uses to make direct investments in small and mid-sized companies in the medical device, pharmaceutical and biotech sectors. Last year, amid an unprecedented economic crisis, the investment fund was cut 40 percent to $15 million.
The current budget, which sits on Patrick’s desk awaiting his signature, calls for the investment fund to be allotted $10 million for the next fiscal year.
That will make it difficult for the center to make direct cash infusions, according to president and CEO Susan Windham-Bannister.
“We’ll have to be conservative in our programs,” she told MassDevice. “We were hoping for a second round of accelerator grants this summer, but it doesn’t look like that will be possible.”
Apart from the bigger initiatives the center funded, such as the Wood’s Hole Marine Biology Lab and a Framingham wastewater treatment plant to help Genzyme expand its facilities there, all of its other programs were paid for using the discretionary fund.
Those programs include a two-year, $7.4 million commitment to help Organogenesis expand its Canton facility and the more than $3 million in accelerator loans handed out to a handful of companies in May.
And the fact that the $10 million allotted for the investment fund next year is tied to whether the state posts a “net-consolidated surplus” in 2009 is potentially more devastating for the center’s prospects. Massachusetts has seen its tax revenues dive during 2009, as companies shed record numbers of jobs and consumer spending declines.
Behind the scenes, the Life Sciences Center has been working its House and Senate connections on Beacon Hill in in hopes of at least matching last year’s funding and untying it from the surplus altogether.
State Sen. Michael Moore (D-Worcester) filed an amendment to free up $5 million from the general fund. But that amendment was not adopted by the joint House-Senate conference committee that worked out the version that made it to Patrick’s desk.
Moore, whose Worcester Country district is home to a large cluster of medical device firms, wanted to make the effort even though he knew it would be a tough sell, Moore’s legislative director Peter Antonellis told MassDevice.
“We felt it was worth the ask,” Antonellis told us.
Now it’s the governors turn to put some muscle behind one of his marquee projects, as he moves into a re-election year.