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The summary below was written by the Congressional Research Service, which is a nonpartisan division of the Library of Congress, and was published on Jun 18, 2020.
New Business Preservation Act
This bill establishes and provides funding for the Innovation and Startups Equity Investment Program, through which the Department of the Treasury shall work with states to invest in new businesses.
Specifically, the bill requires Treasury to provide certain funds to participating states, which such states shall use to administer specified approved programs that provide equity investment in new businesses. Certain areas with high levels of venture capital activity are excluded from the calculation of funds allocated to a participating state. Treasury shall also award funds to approved state programs to provide follow-on investments.
If a state receives funds from an exit, the state shall use such funds to further invest in startups under the approved program. An exit is defined as the (1) acquisition of a startup in which a state has invested under the program; (2) sale of a share of such startup following an initial public offering; or (3) voluntary purchase of a state's ownership interest by the startup, investors, or existing shareholders.
