Daily Archives: April 12, 2011

Senator accuses Bioscience Authority of shipping tax money out of state; agency chairman says program good for Kansas

A state senator leading a legislative investigation of the Kansas Bioscience Authority accused it of shipping million of tax dollars out of state, while the chairman of the authority and the head of its venture-capital program said it has generated millions of dollars of investment in Kansas business.

Wagle

Sen. Susan Wagle, R-Wichita, issued a news release linking to a YouTube video in which the authority’s chief executive officer, Tom Thornton, appears to assure attendees at a Wisconsin economic development conference that they do not have to invest in Kansas to obtain investment money from the authority’s Heartland BioVentures division.

“There’s no geographic restriction here,” Thornton said in the video. “We didn’t require these (venture capital) funds to actually invest in Kansas. I’ll say that very slowly. There’s no restriction whatsoever.

“The bet is that Heartland BioVentures can … develop and present credible investment opportunities to these venture funds that will effectively be superior to and command more capital than whatever they would have gotten from some other region.”

Wagle said Thornton’s comments and policy “are in direct opposition to the intent of the Legislature in creating the authority. Our goal is to create new jobs and foster economic growth in Kansas, not Illinois, not Wisconsin, and not any other state.”

She also said Thornton’s choice of words shows a cavalier attitude toward about $50 million in public funds — a little less than one tenth of the money the state has committed to the authority’s mission of making Kansas a center for biotechnology research.

“He calls it a ‘bet,’” Wagle said. “That’s a heck of a gamble with taxpayers’ money.”

Carlin

Thornton was unavailable for comment, but authority board Chairman John Carlin and David Vranicar, the president of Hearltand BioVentures, defended the agency’s use of capital investments and said Wagle doesn’t appear to understand the plan and how it benefits the state.

Vranicar said that in 2009, the authority board authorized BioVentures to invest as much as $50 million with eight venture-capital firms from around the country. Read More »