Senate approves innovation fund pilot despite objections over investment risk
February 17, 2023 | 2023 Utah Legislature, Utah Legislature, Utah Legislative Branch, Utah
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The Utah Senate passed second substitute House Bill 42 on Feb. 17, authorizing an innovation-focused commercialization effort and allowing state-managed Fund of Funds resources to seed a one-time program to move university research toward marketable products.
Sponsor Senator Milner said the proposal draws on lessons from prior in-state efforts and models used in other states. The bill establishes a Utah innovation lab intended to link university researchers with private-sector expertise and early-stage capital. "It's not coming from the taxpayer dollars. It's coming from the Fund of Funds," Milner said on the floor.
Senator Fillmore pressed the sponsor on risk, saying he understood the measure would set up a $15 million fund that could be exempt from ordinary state investment rules and asked whether that would put taxpayer money at greater risk. Milner and supporters responded that the money comes from the Fund of Funds rather than the general fund, and that the model intentionally pairs public and private dollars to reduce overall risk and attract private-sector discipline.
Senator Bridal, who said she initially worried about the proposal, reported she had become comfortable with the substitute after stakeholder work and support from the bill's sponsors. After discussion, the Senate recorded a roll-call vote of 19 yea, 6 nay, 4 absent and the bill passed.
Why it matters: HB 42 directs public resources toward the early-stage commercialization of university research, which backers argue can translate academic work into new businesses, jobs and state economic growth. Critics warned floor debate could understate the potential downside if public funds are committed without clear guardrails or oversight; sponsors pointed to the Fund of Funds as the source and to a one-time structure intended to be self-sustaining.
What’s next: The bill will be returned to the House for its signature or further consideration according to interchamber procedures.
Sponsor Senator Milner said the proposal draws on lessons from prior in-state efforts and models used in other states. The bill establishes a Utah innovation lab intended to link university researchers with private-sector expertise and early-stage capital. "It's not coming from the taxpayer dollars. It's coming from the Fund of Funds," Milner said on the floor.
Senator Fillmore pressed the sponsor on risk, saying he understood the measure would set up a $15 million fund that could be exempt from ordinary state investment rules and asked whether that would put taxpayer money at greater risk. Milner and supporters responded that the money comes from the Fund of Funds rather than the general fund, and that the model intentionally pairs public and private dollars to reduce overall risk and attract private-sector discipline.
Senator Bridal, who said she initially worried about the proposal, reported she had become comfortable with the substitute after stakeholder work and support from the bill's sponsors. After discussion, the Senate recorded a roll-call vote of 19 yea, 6 nay, 4 absent and the bill passed.
Why it matters: HB 42 directs public resources toward the early-stage commercialization of university research, which backers argue can translate academic work into new businesses, jobs and state economic growth. Critics warned floor debate could understate the potential downside if public funds are committed without clear guardrails or oversight; sponsors pointed to the Fund of Funds as the source and to a one-time structure intended to be self-sustaining.
What’s next: The bill will be returned to the House for its signature or further consideration according to interchamber procedures.
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