Olathe ? The Kansas Bioscience Authority’s board of directors met Tuesday to approve a new operating budget, investments and auditor for the organization.

KBA has been paring down its operating budget the past two years. The new budget is 10 percent smaller than the previous year, and that budget was about a third smaller than the year before that.

KBA CEO Duane Cantrell said the shrinking operating budget reflects cost savings from reorganization and the KBA’s transition from a primarily grant-based, state-funded operation to a more self-sustaining one that relies on investment income to cover its budget.

“What’s important there, if you think of every million dollars of reductions we make, that’s another investment we can make,” Cantrell said.

The KBA was established in 2004 and charged with investing tax funds to help grow the bioscience sector in Kansas.

For the year so far the KBA has posted just over $3.2 million in revenue from state transfers. That’s down from about $22.7 million in the previous year.

It’s also well short of the $29 million projected for the 2015 fiscal year, money that hasn’t been approved in Topeka yet.

A bright spot for the organization is the more than $9.5 million in income from equity investments made in the period, including millions from the sale of stock that had seen its market value jump. The sale was the first from the portfolio and represents most of the equity income the KBA has seen from its inception until now.

The authority also lost nearly $1.7 million in equity investments during the period and $1.2 million in bond income from an investment that defaulted.

On Tuesday the board approved a new auditing firm, Mayer, Hoffman and McCann, to oversee the KBA. Cantrell said the change reflected the shift to a market model for the organization, requiring different financial expertise.

In addition, the board approved an agreement to enter into a limited partnership with an unnamed investment fund and to contribute an undisclosed amount of money through the partnership. Terms of the agreement were discussed in a closed meeting and not available to the public.