First Quarterly Report, FY2022 — Virginia Innovation Partnership Corporation (November 1, 2021)
Summary
A November 1, 2021 letter from Susan Aitcheson, CFO of the Virginia Innovation Partnership Corporation, to Mr. Daniel Timberlake, Director of the Department of Planning and Budget, enclosing the first Quarterly Report for FY2022. The letter states that the attached report fulfills the requirements of the Appropriations Act Item 135 D.2 (Special Session I, 2021). The report includes a budget analysis for the three months ended September 30, 2021 for the Virginia Innovation Partnership Authority, in thousands. It also states that the Auditor of Public Accounts provided a very positive report on CIT's FY21 audit results and that the Board approved changes to CIT's Bylaws and Articles of Incorporation to facilitate SCC approval of the name change to the Virginia Innovation Partnership Corporation (VIPC).
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“First Quarterly Report, FY2022 — Virginia Innovation Partnership Corporation (November 1, 2021).”
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November 1, 2021
Mr. Daniel Timberlake
Director
Department of Planning and Budget
1111 East Broad Street, Room 5040
Richmond, Virginia 23219
Dear Mr. Timberlake:
Enclosed please find the first Quarterly Report for FY2022 Virginia Innovation Partnership
Corporation (CIT>>VIPC). The attached report fulfills the requirements of the Appropriations Act Item
135 D.2 (Special Session I, 2021).
Please feel free to call me at 703-689-3021 if you have any questions.
Sincerely,
Susan Aitcheson
CFO
Virginia Innovation Partnership Corporation
cc: The Honorable Brian Ball, Secretary of Commerce and Trade
Ms. Cassidy Rasnick, Deputy Secretary of Commerce and Trade
The Honorable Janet D Howell, Chair, Senate Finance & Appropriations Committee
The Honorable Luke E. Torian, Chair, House Appropriations Committee
Ms. Anne E Oman, Staff Director, House Appropriations Committee
Ms. April Kees, Staff Director, Senate Finance & Appropriations Committee
Ms. Toni Walker, Associate Director, Department of Planning and Budget
Ms. Samantha Martin, Budget and Policy Analyst, Department of Planning and Budget
Dr. Barbara Boyan, VIPC Board of Directors Chair
Mr. Rob Quartel, VIPC Board of Directors Finance Committee Chair
2214 Rock Hill Road
Suite 600
Herndon, VA 20170-4228
Tel.703.689.3000
November 1, 2021
Mr. Daniel Timberlake
Director
Department of Planning and Budget
1111 East Broad Street, Room 5040
Richmond, Virginia 23219
Dear Mr. Timberlake:
Enclosed please find the first Quarterly Report for FY2022 Virginia Innovation Partnership
Corporation. The attached report fulfills the requirements of the Appropriations Act Item 135 D.2
(Special Session I, 2021).
Please feel free to call me at 703-689-3021 if you have any questions.
Sincerely,
Susan Aitcheson
CFO
Virginia Innovation Partnership Corporation
cc: The Honorable Brian Ball, Secretary of Commerce and Trade
Ms. Cassidy Rasnick, Deputy Secretary of Commerce and Trade
The Honorable Janet D Howell, Chair, Senate Finance & Appropriations Committee
The Honorable Luke E. Torian, Chair, House Appropriations Committee
Ms. Anne E Oman, Staff Director, House Appropriations Committee
Ms. April Kees, Staff Director, Senate Finance & Appropriations Committee
Ms. Toni Walker, Associate Director, Department of Planning and Budget
Ms. Samantha Martin, Budget and Policy Analyst, Department of Planning and Budget
Dr. Barbara Boyan, VIPC Board of Directors Chair
Mr. Rob Quartel, VIPC Board of Directors Finance Committee Chair
2214 Rock Hill Road
Suite 600
Herndon, VA 20170-4228
Tel.703.689.3000
Item 135.D.2.a
Fiscal Year 2022 Quarter 1
Sept 30, 2021
Financial Performance
Virginia Innovation Partnership Authority
BUDGET ANALYSIS
For the Three Months Ended September 30, 2021
(In Thousands) (In Thousands)
ACTUAL -Jul - Sept 2021 FORECASTED -Fiscal Year 2022
Actual Budget Variance Forecast Budget Variance
Revenue
$ 14,450 $ 10,388 $ 4,063 Commonwealth Appropriation - General Fund $ 41,550 $ 41,550 $ -
1 1 - Interest & Misc. Income 4 4 -
14,451 10,389 4,063 Total Revenue 41,554 41,554 -
Expenses and Transfers
- 1 (1) VIPA Administrative Expense 3 3 -
4,025 4,025 - Transfer to VIPC - FY2022 Appropriation 16,100 16,100 -
9,350 6,363 2,988 Transfer to COEs - FY2022 Appropriation 25,450 25,450 -
13,375 10,389 2,987 Total Expenses & Transfers 41,553 41,553 -
Consolidated Revenue, Expenses and Changes in Net Position
14,451 10,389 4,063 Revenue 41,554 41,554 -
13,375 10,389 2,987 Expenses and Transfers 41,553 41,553 -
1,076 0 1,076 Change in Net Position 1 1 -
2,594 2,028 566 Beginning Net Position 2,594 2,028 566
$ 3,670 $ 2,028 $ 1,642 Ending Net Position $ 2,595 $ 2,029 $ 566
Virginia Innovation Partnership Corporation
BUDGET ANALYSIS
For the Three Months Ended September 30, 2021
Commonwealth Projects Funded by Appropriation & Other Revenue
(In Thousands) (In Thousands)
ACTUAL -Jul - Sept 2021 FORECASTED - Fiscal Year 2022
Actual Budget Variance Forecast Budget Variance
Revenue
$ 4,025 $ 4,012 $ 13 Commonwealth Appropriation - General Fund $ 16,046 $ 16,046 $ -
1,282 25 1,257 Interest, Sponsorship, Return on Investments & Misc. Income 1,357 101 1,256
5,307 4,037 1,270 Total Revenue 17,403 16,147 1,256
Expenses
631 830 (199) Commercialization Division 5,043 11,772 (6,729)
3,206 2,364 842 Investment Division 8,844 8,691 153
153 751 (598) Entrepreneur Ecosystems Division 3,087 3,274 (187)
291 222 69 Strategic Initiatives 1,733 1,685 48
161 343 (182) Unmanned Systems 1,928 1,871 57
- - - Activities Funded by Building Sale Proceeds 2,000 2,000 -
203 278 (75) Policy, Communications and Commonwealth Engagement 1,447 1,159 288
(110) 87 (197) Unapplied (over-applied) indirects 42 (825) 867
4,535 4,875 (340) Total Expenses 24,124 29,627 (5,503)
772 (838) 1,610 Net (6,721) (13,480) 6,759
Strategic Initiatives and Other Funding Provided by Contracts & Grants
Strategic Initiatives
558 198 360 Program Revenue - DHS Commercial First Innovation ™ 4,326 2,295 2,031
516 183 333 Program Expense 4,006 2,125 1,881
42 15 27 Profit/(Loss) 320 170 150
Other
26 58 (32) Program Revenue - SBA FAST 2021 + 2022 104 58 46
26 58 (32) Program Expense 104 58 46
- - - Profit/(Loss) - - -
584 256 328 Program Revenue 4,430 2,353 2,077
542 241 301 Program Expenses 4,110 2,183 1,927
42 15 27 Net 320 170 150
Consolidated Revenue, Expenses and Changes in Net Position
5,891 4,293 1,598 Revenue 21,833 18,500 3,333
5,077 5,116 (39) Expenses 28,234 31,810 (3,576)
814 (823) 1,637 Change in Net Position (6,401) (13,310) 6,909
77,451 74,920 2,531 Beginning Net Position 77,451 74,920 2,531
$ 78,265 $ 74,097 $ 4,168 Ending Net Position $ 71,050 $ 61,610 $ 9,440
Virginia Innovation Partnership Corporation
Fiscal Year 2022 Q2 Forecast
Operating Funds Designated Funds
COV Other COV
Entrepreneurial Strategic Unmanned
Discretionary Grants & Commercialization Investment Ecosystems Initiatives Systems 135.P.4
Fund Contracts Division Division Division Fund Fund Funds Total
(In Thousands)
Beginning Balance at 7/1/2021 $ 994 $ 665 $ 32,384 $ 17,508 $ 3,296 $ 542 $ 1,384 $ 20,678 $ 77,451
REVENUE
General Fund Appropriation $ 3,946 $ 5,000 $ 3,100 $ 2,000 $ 1,000 $ 1,000 $ 16,046
Interest, Sponsorship, Return on Investment $ 72 $ 53 $ 1,201 $ 4 $ 27 $ 1,357
Contracts & Grants $ 4,430 $ 4,430
Total Revenue $ 4,018 $ 4,430 $ 5,053 $ 4,301 $ 2,004 $ 1,000 $ 1,027 $ - $ 21,833
EXPENSES AND TRANSFERS
Operating Programs Net of Unapplied Indirects $ 1,489 $ 1,489
Designated Programs $ 3,728 $ 4,099 $ 7,291 $ 2,521 $ 1,420 $ 1,576 $ 2,000 $ 22,635
Contracts & Grants $ 4,110 $ 4,110
Transfers and Indirect Application to Designated Programs $ (230) $ 100 $ 28 $ 50 $ 17 $ 10 $ 11 $ 14 $ -
Total Expenses $ 4,987 $ 4,210 $ 4,127 $ 7,341 $ 2,538 $ 1,430 $ 1,587 $ 2,014 $ 28,234
Net Change $ (969) $ 220 $ 926 $ (3,040) $ (534) $ (430) $ (560) $ (2,014) $ (6,401)
Forecasted Ending Balance at 6/30/2022 $ 25 $ 885 $ 33,310 $ 14,468 $ 2,762 $ 112 $ 824 $ 18,664 $ 71,050
Item 135.D.2.b
Fiscal Year 2022 Quarter 1
Sept 30, 2021
Investments & Grants
Virginia Innovation Partnership Corporation
Investments Made and Return on Prior Investments
For the three months ended September 30, 2021
Investments made Growth Acceleration Program (GAP):
Actual Budget Variance
Investment in 18 companies $ 1,975,369.00 $ 1,275,000.00 $ 700,369.00
Return on Prior Investments, including gains and losses:
Returns from 3 companies $ 1,193,262.00
Item 135.D.2.c
Fiscal Year 2022 Quarter 1
Sept 30, 2021
Financial & Programmatic
Performance of Operating
Entities Owned by VIPC
No Operating Entities Owned
during FY22 Q1
Item 135.D.2.d
Fiscal Year 2022 Quarter 1
Sept 30, 2021
Transition to new Authority
Timeline and Associated Activities for transition into the new Authority
CIT began the transition from its management of the Innovation and
Entrepreneurship Investment Authority (IEIA) to management of the new Virginia
Innovation Partnership Authority (VIPA) after passage of HB1017 and SB756 in
the 2020 Session of Virginia's General Assembly. That new role - as the VIPA
managing non-profit - became official on July 1, 2020.
To ensure a smooth transition and sustained program operation, CIT’s existing Board
remained in place until future governance could be established. In preparation for the
first VIPA Board meeting, CIT’s Board met for the final time on December 3, 2020 to
approve changes in CIT’s bylaws and articles of incorporation that would allow the
newly formed VIPA Board to also serve as the Board for CIT.
Six of the eleven VIPA Board of Directors were appointed in July by Governor Northam
and a seventh, Virginia's Secretary of Commerce & Trade serving as the VIPA Vice
Chairman, is also in place. As of December 31, 2020, the Board positions allocated for
appointment by the General Assembly's Joint Rules Committee in the authorizing
language are yet to be made. However, the current seven appointees constitute a
quorum for the VIPA and the inaugural Board meeting was held on December 17, 2020.
The following Board Members were present at the meeting:
Vice Chairman - Secretary Brian Ball
Member - Ms. Monique Adams
Member - Dr. Barbara Boyan
Member - Mr. Richard Hall
Member - Mr. Chiedo John
Member - Mr. Kurt John
Member - Ms. Paula Sorrell
At the December 17 Board meeting, several critical actions were taken by the Board to
ensure that CIT is authorized to provide administrative and operational support to the
VIPA and ensure uninterrupted services from programs that require VIPA oversight.
These actions were unanimously approved through a governance resolution and
separate motions that included:
Designating CIT as the managing non-profit and operating arm of the VIPA
Appointing the President of CIT to serve as the President of the VIPA and carry
out the duties outlined in the resolution
Designating the Board of Directors for the VIPA to also serve as the Board of
Directors for CIT
Approving Advisory Boards for the Investment, Commercialization, and
Entrepreneurial Ecosystems Divisions at CIT
Approving Guidelines for the first solicitation of the Commonwealth
Commercialization Fund (CCF) to be announced in January 2021.
Delaying the first report on the VIPA Centers of Excellence until December 1,
2021
Delaying the election of VIPA officers until the full Board has been appointed.
The VIPA held its second Board meeting on March 4, 2021, however, the four Joint
Rules Committee appointments have still not been announced. The Board received an
update on CIT’s FY21 goals and objectives and strategies for FY22 planning.
Additionally, the VIPA Board approved the criteria for the Regional Innovation Fund.
Overviews of VIPA’s four centers of excellence (CCAM, CCALS, CCI, VBHRC) were
presented by the directors of each organization.
Significantly, the first solicitation of the new Commonwealth Commercialization Fund
was launched in January 2021, and the first solicitation of the new Regional Innovation
Fund was launched in March 2020. Both programs made awards before the end of
FY21.
In May 2021, the General Assembly’s Joint Rules Committee made the remaining four
appointments to the VIPA. Those members were:
Member – Andrew Ko
Member – Chris Long
Member – Rob Quartel
Member – Angela Reddix
The full Board met for the first time on June 10, 2021, virtually. Key items on the
agenda for the 4th Qtr. meeting included: Approval of CIT’s Operations Plan for FY22,
approval of CIT’s budget for FY22, approval of the recommended name change from
the Center for Innovative Technology (CIT) to the Virginia Innovative Partnership
Corporation (VIPC). The Board was provided a timeline for the rebranding effort that
will include SCC approval for the corporate name change.
CIT's Entrepreneurial Ecosystems Division is working with stakeholders in all nine GO
Virginia Regions to establish criteria for the second solicitation of the Regional
Investment Fund (RIF). The criteria were presented to, and approved by, the VIPA
Board at the March 4, 2021, meeting. The first awards from the RIF were made in June
FY21.
Since July 1, 2020, operational funding for CIT and the newly consolidated COEs has
been provided to CIT and then distributed accordingly. Portions of the overall Item#135
appropriation initially required VIPA Board approval but, since an initial meeting of that
Board was delayed pending appointment the full Board, a budget amendment (Item 135
#2.c) was submitted and passed during the 2021 Special Session of the General
Assembly that authorizes CIT's President and CEO to approve and release related
funding. Appropriated funds have been provided to the COEs in accordance with
requirements outlined in the budget language.
The Virginia Innovation Partnership Authority (VIPA) held its first in-person Board
meeting on September 9th in Richmond. In addition to offering the first chance for most
Board members to meet each other in-person, the meeting was significant for many
important actions taken by the Board.
Dr. Barbara Boyan, the Dean of VCU’s College of Engineering, was elected as
the VIPA’s first Board Chairperson.
The Board established five new standing committees and Chairpersons for each:
o Executive Committee – Barbara Boyan
o Finance Committee – Rob Quartel
o Strategy Committee – Kurt John
o Entrepreneurial Ecosystems Committee – Paula Sorrell
o Diversity, Equity, and Inclusion Committee – Angela Reddix
The Auditor of Public Accounts provided a very positive report on CIT’s FY21
audit results.
The Board approved changes to CIT’s Bylaws and Articles of Incorporation to
facilitate SCC approval of the name change to the Virginia Innovation Partnership
Corporation (VIPC).
The President’s Report included a review of CIT finance, operational highlights,
and corporate performance for FY21. This included an assessment of goals and
metrics established in the FY21 operating plan.
The Board reviewed and accepted the Investment Division’s Indirect Investment
policy recommendations
CIT’s marketing consultant, ACG, provided an update on the rebranding process.
We are on track for an early October roll out.
No delays or disruptions have been experienced in any CIT legacy programs because
of the transition to the VIPA. All Divisions are working with their appointed advisory
committees to update goals and objectives that were the basis for the FY22 operating
plan and budget.
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