Marco Rubio (from left), Steve Case, Mark Warner, Jerry Moran and Chris Coons helped introduce Startup Act 2.0 in May.
Startup Act 2.0, a bill introduced last month by a group of U.S. Senators that included Sen. Jerry Moran of Kansas, aims to make success come easier to entrepreneurs, allow businesses to recruit bright minds from all over the world and retain foreign college graduates who want to start businesses in the U.S.
The original Startup Act, introduced in December of 2011, didn’t garner enough votes to pass due to concerns about loosening immigration laws. The second version of the bill is cosponsored by a group of several Republican and Democratic senators. Here are a few of the provisions of the bill designed to help new companies:
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- Creates a research and development tax credit for startups younger than five years old and less than $5 million in annual receipts.
- Loosens immigration laws to allow foreign students with master’s degrees or Ph.D.s in technology, science, engineering and math to stay in the U.S. after graduating.
- Creates a new category of visa for legal immigrants who want to launch businesses in the U.S.
- Eliminates the per-country caps for employment-based immigrant visas, which hinder U.S. employers from recruiting employees from other countries.
- Requires all government agencies to conduct a cost-benefit analysis of all proposed “major rules” with an economic impact of $100 million or more. This is meant to determine how efficient business regulations are and their effect on the growth of new businesses.
We caught up with Sen. Moran (below) via email to ask him about how the Startup Act 2.0 will benefit the Silicon Prairie, the difference between this version of the bill and the first and how he plans to garner support in the House and Senate.
Silicon Prairie News: What are the major differences between the first Startup Act and version 2.0?
Jerry Moran: Startup Act 2.0 is a bipartisan jobs bill that will spur economic growth by targeting policies toward the young companies responsible for creating almost all of the net new jobs in America. It contains many of the provisions of the original Startup Act but also adds two new job-creating ideas. Startup Act 2.0 incorporates language from the Coons-Rubio AGREE Act to eliminate the per-country cap for employment-based immigrant visas, which has been a major factor in causing the backlogs that currently hamstring our legal immigration system.
In addition to eliminating the per-country caps, Startup Act 2.0 creates a targeted research and development (R&D) tax credit for startups less than five years old with less than $5 million in annual receipts. Because the current R&D credit can only be used against income taxes a company pays, startups without taxable profits cannot benefit from the credit. The R&D credit created in Startup Act 2.0 is designed to allow startups to offset employee taxes—helping young companies grow and create jobs.
SPN: What role did the Ewing Marion Kauffman Foundation have on the legislation, if any?
JM: Last summer, I read a report published by the Kauffman Foundation that made a compelling case for the importance of entrepreneurship and startups to the strength of America’s economy. I was searching for ways to promote economic growth at that time and set out to write legislation that would implement many of the policy recommendations outlined in the Kauffman Foundation’s report. That legislation became the original Startup Act.
SPN: What parts of the bill do you see especially benefiting Kansas and the Midwest?
JM: Kansas City has set the goal of becoming “America’s Most Entrepreneurial City.” Startup Act 2.0 sets out to create an environment where entrepreneurs in Kansas City and all across America will have a better shot at success.
To succeed, entrepreneurs need to attract and retain talented workers, capital to develop a product, and a regulatory environment that allows entrepreneurs to spend more time growing their company rather than complying with government mandates. Startup Act 2.0 addresses each of these areas.
SPN: Are there any other Midwestern senators who have voiced support for the bill so far?
JM: Senator Roy Blunt from Missouri is a cosponsor and strong advocate for Startup Act 2.0. This month, a companion bill was introduced in the House of Representatives and U.S. Representative Kevin Yoder from Kansas is one of its leading supporters. Representatives Dold (IL) and Carnahan (MO) are also cosponsors of the House bill.
SPN: Do you foresee any road blocks in passing the bill due to its loosening of immigration laws? What about the fact that it was endorsed by President Obama’s Council on Jobs and Competitiveness in an election year?
JM: Passing legislation is never easy — especially in an election year — but we can’t afford to wait or use the excuse that just because we have an election in a few months, we can’t get this done. Americans expect their elected officials to work together to solve the challenges facing our country. That is what the supporters of Startup Act 2.0 and I are attempting to do.
In the last year and a half, seven countries have adopted new laws to attract entrepreneurs. Countries like the United Kingdom, Canada, and Singapore are among the countries moving aggressively to attract and retain highly-skilled individuals with the talent and good ideas to start new businesses. These countries are not just passing new laws, they are aggressively pursuing entrepreneurs and talented individuals. The United States cannot afford to turn a blind eye to our competitors or use the coming elections as an excuse to delay action on an issue so critical to our economic future.
More than 12 million Americans are looking for work, and research shows that the best way to create jobs is to make it easier for entrepreneurs to start and expand businesses. That is what Startup Act 2.0 does. Now is the time to act – not after the election, not next year.
Credits: Top photo from warner.senate.gov. Photo of Sen. Moran from moran.senate.gov.
