LAW TO IMPROVE ACCESS TO CAPITAL FOR MAINE BUSINESSES TAKES EFFECT

AUGUSTA—A new law that will help Maine businesses secure financing by extending and improving the successful Maine Seed Capital Tax Credit Program will go into effect this Friday.

“Starting a businesses is always a bit of a leap of faith, and we should do everything we can to support entrepreneurs with the vision and courage to take that leap,” said Senator Jim Boyle of Gorham, a small business owner and supporter of the law. “Increasing access to venture capital will help Mainers start their businesses and create jobs.”

At the public hearing in support of the bill, Beth Bordowitz, CEO of the Finance Authority of Maine (FAME), cited the program’s success in helping to create more than 2,000 jobs and retain more than 5,000 jobs in Maine.

The program provides tax credits to private equity investors who invest in eligible Maine businesses. Every $1 spent yields $8 of investment; in 2012, $4.67 million was invested in a dozen Maine companies and since the creation of the program 128 Maine companies have received capital.

“We know this program helps Maine businesses,” said Senator Linda Valentino of Saco, the sponsor of the bill. “Expanding the program will help small businesses grow and create more jobs for Maine workers.”

Access to venture capital has historically been difficult for Maine entrepreneurs. Maine lags far behind other New England states and the nation in average annual venture capital investment per capita, with only one-third the average annual investment per capita of Vermont and about one-ninth the annual investment in neighboring New Hampshire.

The bill became law without Governor LePage’s signature on January 12, 2014 and will go into effect on Friday. The text of the law can be found here.

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