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Innovate Alabama approved three applications for the first round of the new Innovate Alabama Tax Credit at a Tuesday board meeting held at Oak Mountain State Park in Pelham and made open to the public.
The tax credit is administered by Innovate Alabama, as detailed in the Innovation and Small Business Act signed into law in April as part of Governor Kay Ivey’s four-bill “Game Plan.” Donors to economic development organizations approved by Innovate Alabama may receive a tax credit equal to their donation to offset up to 50 percent of certain taxes, including income tax.
“As we think about access to capital, which is one of the most central core missions of this group, this is a very healthy start in our infancy as more than an entity, but it should be seen only as a beginning. We have a lot of work to do. And it’s probably some of the more complex and complicated work but the most critical work as it relates to our mission, the scope of this board. This is an incredible start, and I think it’s really a springboard for us,” board chair Bill Poole, the director of the Alabama Department of Finance, said.
The program recognizes two qualifying activities of economic development organizations: tech accelerators, which train early-stage tech companies, and innovative companies, which are small, for-profit Alabama companies in an “innovative industry.” Innovate Alabama received nine applications from organizations seeking a total of $16.3 million in tax credits. Five were tech accelerators, and four were innovative companies.
The innovate Alabama board of directors approved three of the nine applications: Bronze Valley’s VentureLab Alabama tech accelerator, Techstars’ Alabama EnergyTech Accelerator, and the Huntsville-based HudsonAlpha Institute for Biotechnology. Innovate Alabama CEO Cynthia Crutchfield encouraged the six remaining organizations to apply for the second round of applications, due August 9 and reviewed at the next board meeting on August 29.
“We’re going to reach out to them and work with those organizations and get to resolution. I think the biggest challenge was making the connection to the innovative companies,” Crutchfield said.
During the two-hour Tuesday meeting, the board also approved a plan for the State Small Business Credit Initiative, which administers $97 million in federal funds granted as part of the American Rescue Plan. Of those funds, $25 million will be used in a venture capital program. The plan needs approval by the U.S. Treasury Department before going into effect.
The board also approved 13 recommendations to improve outdoor recreation as presented by Department of Conservation and Natural Resources Commissioner Chris Blankenship. The board also heard updates on several programs: SBIR/STTR funding, an asset network for innovative organizations, HBCU engagement, and the Emerging Innovation Scholars program.
“This year, Innovate Alabama’s reach and impact have expanded remarkably,” Crutchfield said. “This great work could not be accomplished without the support and collaboration of our committed board of directors and local and statewide organizations — from incubators, accelerators and startups to higher-ed institutions, government leaders and investors, each with footprints in different regions of Alabama. We’re thankful for their support and are honored to continue helping innovators grow roots in this great state that we call home.”
