Aurora – Mayor Ed Tauer wants to use some of the money the city unexpectedly had left over last year to create a venture capital fund to help startup biotech and other knowledge-based companies.
Tauer discussed the idea at a joint speech with Denver Mayor John Hickenlooper on Thursday and also at his State of the City speech the day before.
Aurora’s finances last year were boosted by an extra $8 million, half of which was set aside for a lawsuit filed by the Calpine Corp., which was dropped.
Tauer wants the City Council to approve using a portion of what he called a windfall to help fledgling businesses, particularly bioscience firms.
Aurora now provides tax-based incentives to companies, including sales-tax-revenue breaks, but that isn’t necessarily what knowledge-based companies need, he said.
“They need operating money,” he said.
On Thursday, Tauer gave an example from New Mexico in which every $4 of venture capital from private sources is matched by $1 of government money.
“The idea is, let’s try to turn our incentive discussion instead into an investment discussion,” he said.
It’s needed, he said, because there isn’t much state money. The Colorado Venture Capital Authority, with money approved by the legislature, has $25 million to invest in startup companies through 2010.
Tauer’s idea is necessary, said Wendy Mitchell, president of the Aurora Economic Development Council.
“The type of assistance (bioscience companies) need is to pay for the brains, the researchers, people who are developing the product, and sales tax incentives don’t help,” she said.
The idea, she said, is to collaborate with other cities in the region to develop a fund. Tauer said maybe $1 million to $2 million could create the fund, but that would ultimately be up to the council.
“We will have $4.3 billion invested at the Fitzsimons campus at full build-out, and we need to look at long-term ways to support the industry and facilitate growth,” Mitchell said. “We need to all get together and solve this and not wait for someone else to help solve it.”
Staff writer Jeremy P. Meyer may be reached at 303-820-1175 or jpmeyer@denverpost.com.
