Researchers preparing to take advantage of SMART Act

One of the centerpieces of Secretary of State Delbert Hosemann’s legislative agenda passed in the last session, and university researchers are getting ready to take advantage of it.

The Strengthening Mississippi Academic Research Through (SMART) Business Act provides a 25 percent rebate to Mississippi companies that contract with Mississippi public universities and colleges for qualified research. The legislation caps the rebate at $1 million per company, and $5 million overall per fiscal year.

Similar legislation, when the incentive was a tax credit and not a direct rebate, died the past two sessions. “There was some concern last year about how much this was going to cost, so this addresses that,” Hosemann said in January.

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Gerald Nelson, director of Mississippi State University’s Office of Entrepreneurship and Technology, said his office started getting the word out about the bill late in the session, when it became evident that the bill was most likely going to pass.

“We had already started to talk about it with our industry partners and corporate research people that do engineering research or scientific research of any kind. We emailed it out to a number of our contacts and will continue to advertise it as something they should consider to enhance their reasons to conduct this kind of research.”

Nelson said the responses have been generally positive. No company has contracted for research for after July 1, when the bill becomes law, but Nelson there are “three or four that are prominent in Mississippi that are doing some licensing of technology having to do with alternative energy” that are strong possibilities.

“These licensees are talking to people in the state of Mississippi so either them or the company that’s licensing the technology would be able to take advantage of the credit aspect of the plan. Particularly now that it’s signed into law and is about to take effect, on a regular basis we’ll be notifying our constituents that it has passed and is available to them and they should consider it a plus.”

Nelson expects the new law to have an impact on private research, which dipped some during the recession, partly due to companies tightening or eliminating research budgets and the moratorium on congressional earmarks that funded public research that often led to additional private research. “Although that loss of earmarks will impact all research universities, it shouldn’t hinder the type of research mentioned in the bill because this is private research,” Nelson said. “In fact, (the bill) couldn’t come at a better time for companies to take advantage of the federal research that’s already been done.

“It’s not enough money that it will cover tens of thousands of businesses, but I think we’ll find select parties who will take advantage of it, and probably would not have taken advantage of it had the bill not been available,” Nelson continued. “We definitely think it’s going to be a catalyst to some of these companies actually moving forward to get some research done so they can take these technologies out and commercialize them. This particular piece of legislation will find that smaller piece of research that it takes to commercialize that technology. In many cases, we see that, where the technology is done. It’s useful and applicable but it needs a little bit more tweaking to take it to the commercial level, and that’ something this bill provides.”

The law as passed by Gov. Phil Bryant does not have a repealer, which could boost its long-term impact, Nelson said.

“I think that if this program is continued, and it needs to be, that it could have a large impact,” Nelson said. “It has to become part of the landscape in the state of Mississippi, that private research has this credit to being to think in terms of private research being done at a public university. A one- or two-year stretch would not really build it into the culture. If you want to incorporate this into the culture, it has to be permanent, at least 10 years. It takes a while for something like this to get ingrained in a corporate entity’s thought process.”

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