Complete 2012 forensic audit documents - Kansas Bioscience ...

Some individuals BKD interviewed objected to the idea of a “by invitation only” program
funded with taxpayer money. David Vranicar stated that the purpose of the POCI, particularly
the POCI less than $75,000, which requires less formal approval and, therefore, can be made on
a somewhat expedited basis, is to be able to give a very early-stage company money it needs to
determine if it actually has a product or idea worth pursuing. These companies are too earlystage
to fit into other KBA funding programs. However, not every early-stage company or idea
is invited to participate for a number of reasons. HBV turns many opportunities away because
they are not well thought out or do not have a sustainable market. Therefore, HBV staff is
selective regarding the opportunities that are awarded POCIs. Mr. Vranicar indicated this is why
the POCI program is not listed on KBA’s website.
Bioscience Research Facilities Program
K.S.A. 74-99b09(16) allows for the funding for the construction and on-going maintenance of
bioscience research facilities. These facilities can be developed in collaboration with
communities and universities with the goal of providing for sufficient state-of-the-art bioscience
research space. This program has supported the development of incubators, laboratories, the
Kansas Bioscience Park and the Venture Accelerator.
Through June 30, 2011, seven Bioscience Research Facilities awards have been approved for
funding in the amount of $30,768,968. Through June 30, 2011, $8,925,186 had been paid.
Please refer to Exhibit 14 for a listing of the Bioscience Research Facilities awards. The two
largest commitments, the Kansas Bioscience Park and the Venture Accelerator are discussed in
more detail later in this report.
Kansas Bioscience Growth Fund
K.S.A.74-99b09(27f) states that KBA may invest the funds received from gifts, grants, donations
and other operations of the authority in such investments as would be lawful for a private
corporation having purposes similar to the authority including pre-seed, seed capital and venture
capital funds whose purpose is to commercialize bioscience intellectual property, and in any
obligations or securities as authorized by the BOD. Please refer to the Kansas Bioscience
Growth Fund section later in this report for further discussion.
As of June 30, 2011, eight Growth Fund awards have been approved for funding in the amount
of $50 million. Through June 30, 2011, $6,841,382 had been paid. Please refer to Exhibit 15 for
a listing of the Growth Fund awards.
Companies can receive funding under more than one of the above detailed programs at a time. A
listing of companies receiving funding under multiple funding programs is detailed in
Exhibit 16.
OTHER KBA INITIATIVES AND PROJECTS
NBAF
On January 25, 2007, Governor Sebelius issued Executive Order 07-01, which created the
Kansas National Bio and Agrodefense Facility Task Force to lead Kansas’ pursuit of NBAF.
Governor Sebelius gave KBA the responsibility of providing primary support and assistance to
the task force. Therefore, Mr. Thornton stepped into a leadership role with regard to NBAF. In
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