(Orange, Texas)

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January 4, 2013

State's investment funds await new Lege scrutiny


AUSTIN, Texas —

The current value of the fund won't be publicly known until an annual report due out later this month.

Both the tech fund and the part of CPRIT's budget that is set aside for private company awards — roughly 15 percent, as the bulk of CPRIT's funding underwrites cancer research in university labs — were established with economic development and breakthroughs in mind. Backers defend the taxpayer funding as another boost to Texas' rapidly growing high-tech sectors the well-paying jobs the industries bring.

But critics of the programs believe the run of bad news — particularly surrounding CPRIT — is making more lawmakers skeptical of whether the state is getting its money's worth or simply enriching private companies.

"I'm afraid the motivation has become very clear to lawmakers and even the public," said Glenn Smith, director of the liberal Progress Texas PAC, which filed a complaint against CPRIT with prosecutors in Austin.

Budget writers harshly questioned CPRIT leadership — those still left at the agency, anyway — at a public hearing just before Christmas. It came after Perry and other state leaders ordered a moratorium on CPRIT awards until confidence in the beleaguered program could be restored.

Lawmakers appear to prefer implementing stronger checks, balances and oversight of the agency, instead of punishing it by withholding funding. But the slice of money CPRIT sets aside for private startups will almost certainly be revisited this session.

"This was cancer prevention research. This was not the cancer prevention hedge fund, this was not the cancer prevention venture capital fund. This is not the Emerging Technology Fund," said Democratic state Rep. Craig Eiland, a member of the House Appropriations Committee. "That's something we need to take a look at closely in the Legislature."

One change already being implemented to the tech fund is a bigger emphasis on so-called "success-based" funding waves that will require companies to hit more milestones to collect their full award.

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