Reps. Grimm, Sanchez Announce Industry Support for Startup Act 3.0

Feb 28, 2013 Issues: Economy and Jobs
Reps. Grimm, Sanchez Announce Industry Support for Startup Act 3.0

WASHINGTON, DC – Today, Reps. Michael G. Grimm (R-NY) and Loretta Sanchez (D-CA) wrapped up Startup Week on the Hill by announcing strong industry support for their Startup Act 3.0, which was introduced on February 14, 2013 with Reps. Kevin Yoder (R-KS), Jared Polis (D-CO), Devin Nunes (R-CA), Gerald Connolly (D-VA), and Steve Chabot (R-OH). The Startup Act 3.0 is a bill to create and keep jobs in America; increase America’s access to talent in the fields of science, technology, engineering, and math (STEM) by reforming high-skilled visa policies; and create opportunities for startup businesses with tax incentives and access to resources for innovation.

“Startup 3.0 will provide a boost to America’s new and innovative companies, propelling them forward to compete globally and hire locally. Too often we educate the world’s best and brightest in STEM fields, only to send them back to countries like India and China to open businesses and compete against us. This bill will keep top talent here in the U.S. to build businesses that hire Americans, and drive U.S. innovation and competitiveness. I am proud to reintroduce this new and improved version of the Startup Act with my colleagues in the House and Senate and to have the strong backing from leaders in the industry,” said Rep. Grimm.

“I’m proud to author this legislation to help American companies. Business leaders need Startup 3.0 so they can hire highly-skilled entrepreneurs and engineers who will innovate and grow our economy.  Often these individuals are educated in the United States and then sent away to work in their home countries.  American businesses should be able to hire them here – their work will grow our economy and help to create jobs,” said Rep. Sanchez.

“Around the world, competing countries recognize that immigration policy is a key driver of economic prosperity, and they are changing their policies to attract top talent. The introduction of Startup 3.0 shows bipartisan agreement that America can no longer afford to wait – we must make every effort to attract and keep the world’s best minds, regardless of where they come from,” said New York City Mayor Michael R. Bloomberg.

Startup 3.0 helps increase America’s access to talent by creating a new set of conditional visas for 75,000 immigrant entrepreneurs and 50,000 foreign STEM graduate student that together will create half a million new American jobs. Research has demonstrated the positive impact of immigrants on American job creation:  More than 40 percent of all Fortune 500 companies were founded by an immigrant or the child of an immigrant, and each foreign-born advanced degree holder who stays in the U.S. to work in a STEM occupation created an estimated 2.6 American jobs. 

Research shows that startups create 3 million jobs per year, on average. In addition, over the past 30 years, companies less than five years old have created almost all the new net jobs in America.

This bill builds upon those successes by using tax incentives to spur continued growth and innovation.  In an important change from the previous bill, Startup 3.0 allows qualified companies to apply research and development tax credits to their payroll tax liability, up to $250,000.  For small startups, it also makes permanent the 100 percent capital gains tax exemption on investments that are held for more than 5 years, in addition to the 28 percent exemption on qualified small business stock. These provisions will unlock over $7.5 billion in new investments which will result in more innovation and jobs.  Finally, the bill helps cut red tape, by requiring a cost-benefit analysis of any significant rule being proposed by a federal or independent agency.

The Startup Act 3.0 was also introduced in the Senate on February 13, 2012 by Senators Jerry Moran (R-KS), Mark Warner (D-VA), and Christopher Coons (D-DE).

The bill is supported by Microsoft, Google, National Small Business Association (NSBA), CTIA, Consumer Electronics Association (CEA), Financial Services Forum, Computer and Communications Industry Association (CCIA), TechAmercia, Information Technology Industry (ITI), Compete America, Silicon Valley Leadership Group, TechNet, Angel Capital Association, and CompTIA.

"The startup community needs an immigration system that works so that companies can continue to drive the engine of the American economy. The entrpreneurial provisions contained in Startup Act 3.0 will provide great support to innovators by helping them start new businesses, and source and retain the talented individuals who will them help grow," said Michael McGeary, Co-Founder, Engine Advocacy.

“America’s small businesses are struggling, in fact, 50 percent project no growth whatsoever for their own business this year. Small businesses need Congress to roll up their sleeves and promote policies that will help, such as the Startup Act 3.0 which would enhance their ability to grow and create jobs. This bill is the perfect example of the good work that can be accomplished with bipartisan efforts, and I applaud Reps. Grimm, Sanchez, Yoder, Polis and Connolly for their leadership,” said Todd McCracken, President and CEO, National Small Business Association (NSBA).

"Highly skilled workers are helping drive innovation and job growth opportunities that are crucial to America's economic recovery.  To sustain this growth, companies like Microsoft need to be able to recruit and retain the world's brightest minds to complement our large number of US employees. We applaud Representatives Grimm and Sanchez for reintroducing this important legislation to help fuel innovation and create more jobs in this country.  We urge Congress to enact bipartisan legislation in 2013 that addresses these important challenges and finally reforms our outdated high-skilled immigration system,” said Fred Humphries, VP of US Government Affairs, Microsoft.

“The Startup Act 3.0 opens up opportunities for the IT sector to continue hiring high-skilled workers who produce some of the world’s most advanced technology products and services, right here in the US. The Act spurs innovation at its core by creating incentives for investment, entrepreneurship and job growth, and helps to build a secure 21st century American economy,” said Todd Thibodeaux, President and Chief Executive Officer, CompTIA.

“Startup Act 3.0 includes many strategic policy changes necessary to expand the U.S. economy and allow small, entrepreneurial companies to grow and thrive. CEA urges both the House of Representatives and Senate to pass the Startup Act 3.0 expeditiously,” said Gary Shapiro, President and CEO, Consumer Electronics Association.

“On behalf of our member companies, we voice our support for Startup Act3.0. We applaud you for introducing this legislation, which will continue our economic recovery by providing greater support for high-­‐paying and high-­‐skilled jobs in STEM.  Providing these new visas for world-class talent will help to fill the over 265,000 IT related jobs currently open, and this will also create further opportunities for starting and growing new businesses in the United States,” said TechVoice.

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