SSTI Digest

As companies across the nation continue to announce massive layoffs during the economic recession, states, localities and private foundations are encouraging entrepreneurial training and providing support services to help create new jobs and assist struggling businesses.

Using the state’s regional advantage, the Rhode Island Economic Development Corporation (RIEDC) wants to create high-wage jobs in targeted industry sectors and establish new equity and financing programs that provide growth capital to sustain the ventures, the agency announced last week.

 

RIEDC released an economic growth plan with the goal of increasing the percentage of jobs that pay above the national average from its current 40 percent to 60 percent over the next 10 years. The average private sector wage in Rhode Island is $38,700 -- $4,600 less than the national average and much lower than neighboring states Connecticut and Massachusetts.

 

The advantage of being located in a “knowledge-rich corridor” that expands from Boston to New York City and encompasses 86 colleges and universities is the formation of a strong R&D and entrepreneurial base, the report states. Rhode Island can build upon this base by targeting industries that depend on knowledge resources and workers, according to RIEDC. The report recommends expansion and attraction efforts within six of these high-wage sectors, including Health and Life Sciences, Marine Trades and Defense Technology, Advanced Manufacturing and Industrial Products, Information Technology and Digital Media, Financial Services, and Consumer Products and Design.

 

Access to capital at all stages of development is a prominent action item within the strategic plan. The plan calls for establishing a $20 million Growth Capital Guarantee Program by restructuring the existing Rhode Island Industrial Recreational Building Authority (IRBA) program. A bill is expected to be introduced in the Rhode Island General Assembly this week that would reduce IRBA’s guarantee authority and establish a new Growth Capital Guarantee authority to assist companies in obtaining growth capital for non-conventional assets such as patents, proprietary processes, software, systems, trademarks, copyrights, brands, contracts and licenses. The current IRBA program, which was created in 1958, addresses company needs only in machinery, equipment and real estate.

 

To provide Rhode Island companies with capital to create these new jobs, the plan calls for establishing a partnership that makes available new debt and equity products through an existing $200 million growth capital products portfolio. The alliance between RIEDC, the Business Development Company of New England and the Business Development Company of Rhode Island is designed to complement existing RIEDC programs and provide up to $2 million in junior debt and up to $5 million in mezzanine equity capital. Additionally, the plan calls for the alliance to consider investments in Rhode Island companies from the $30 million mezzanine fund, MB Capital III.

 

The strategic plan outlines two specific actions to address workforce issues. First, the Community College of Rhode Island 21st Century Workforce Commission will propose recommendations in the coming months for preparing students for jobs of the future and retraining current workers in emerging fields. Second, the newly established 21st Century Workforce Development Subcommittee – a partnership for RIEDC, the Department of Labor and Training, and the Governor’s Workforce Board – is charged with providing recommendations for realigning the state’s current workforce development programs.

 

To increase research activity and new company creation, the Rhode Island Research Alliance will expand its activities to assess collaborative research opportunities and begin assisting with the preparation of collaborative proposals to major funding agencies, including the National Science Foundation and the National Institutes of Health. The plan also calls for expanding and relocating the Slater Technology Fund’s new life sciences incubator. Both of these actions are key recommendations from the Rhode Island Science and Technology Advisory Council’s (STAC) report of activities for the state to pursue in 2008, which was presented to Gov. Carcieri and legislative leaders in early 2007.

 

Although currently facing a projected budget deficit of more than $300 million, Gov. Carcieri’s fiscal year 2009 budget recommendation included level funding for RIEDC and economic development initiatives included in the FY08 budget. This includes $3 million for the Slater Technology Fund, $1.5 million for the Rhode Island Research Alliance and $100,000 for the STAC.

 

RIEDC’s Economic Growth Plan 2008 is available at: http://www.riedc.com/files/2008_economic_growth_plan.pdf

 

Gov. Carcieri’s FY 2009 budget recommendation is available at: http://www.budget.ri.gov/CurrentYear/GovernorsBudget.php

Thomas Rainey was named the new president and CEO of the Northern Arizona Center for Emerging Technologies.

Starting next year, every Rhode Island high school student will be able to participate in the Vex Challenge, an international robotics competition that gives students firsthand experience with project management and engineering. A coalition of education and science and technology advocates, led by the nonprofit Business Innovation Factory, will cover the costs to schools and funding for an annual statewide tournament beginning in 2007. Rhode Island Gov. Donald Carcieri has endorsed the program, which he calls an important part of our plan for educating Rhode Islands next generation of science, technology, and engineering leaders.

 

FIRST, a nonprofit STEM organization founded in 1989 by Segway-inventor Dean Kamen, began the Vex Challenge last year as a spinoff of its advanced competition for college students and professional engineers. Students are issued a basic robotics kit and set about designing a robot that will complete certain basic tasks, such as placing balls in goals or racing towards a finish line. At the statewide tournament, participating teams go head-to-head and score points by completing these tasks. Kits can be reused year after year, minimizing the cost to schools. The Challenge program lets students put their math and science knowledge to work and introduces them to future opportunities in robotics and engineering by teaming them with mentors from local colleges and universities. Gov. Carcieri has announced that the competition will be incorporated into the states new STEM curriculum standards.

 

In recent years, Rhode Island STEM leaders have had a difficult time encouraging students to pursue science and engineering degrees. Though New England as a whole increased its number of advanced science and engineering graduates by 11 percent during the 1990s, Rhode Island suffered a 15 percent drop. The states share of degrees issued in science and engineering remains the lowest in New England and below the national average.

 

Though more than 130 teams participated in the inaugural 2005-06 season, Rhode Island is the first state to provide financial support for teams in all of its high schools. The state is hoping to leverage its small size and increase its national profile by marketing Rhode Island's manageability as a testbed for innovative programs such as the Vex Challenge. All 67 of the states public and charter schools, as well as its career and technical centers, will be able to participate. The coalition will seek support from business and community sponsors to cover the total cost of the program, which is estimated at $140,000. FIRST, the Business Innovation Factory, and the Rhode Island Science & Technology Council also plan to collaborate on a detailed evaluation of the statewide program to facilitate its expansion into other states.

 

Find out more about the FIRST Vex Challenge at http://www.usfirst.org.

 

Read the press release from the Rhode Island Science & Technology Council at: http://www.stac.ri.gov/index.php?section=news&item=21

John Cronin was named state director of the new Rhode Island Small Business Development Center at Johnson and Wales University in Providence. Cronin is CEO of the Rhode Island Manufacturing Extension Partnership.

Rhode Island Gov. Donald Carcieri promoted Saul Kaplan to serve as the new director of the Rhode Island Economic Development Corp. Kaplan replaces three-year veteran Michael McMahon, who left to launch a new equity firm.

Like many low-population states that cannot benefit from tax revenues from oil and gas exploitation such as Wyoming and Alaska, Rhode Island must leverage its existing university and industry research capabilities more fully and encourage more private investment activity, according to the five initial recommendations of the Rhode Island Science & Technology Advisory Council (STAC).

To improve the way students learn and teachers teach in the areas of science and mathematics, Rhode Island Gov. Donald Carcieri's Blue Ribbon Panel on Mathematics and Science Education recommends 12 specific strategies in four key areas including governance and culture; teacher recruitment; teacher quality; and learning opportunities for students.

While many states are striving to increase broadband availability (see the Kentucky story above, for example), a Providence-based nonprofit released a study this month promoting the feasibility of making Rhode Island the first entirely networked state for broadband wireless.

Gov. Donald Carcieri last month announced two new initiatives targeting Rhode Island's science and technology (S&T) and manufacturing industries. On April 12, Gov. Carcieri signed an Executive Order creating the Science & Technology Advisory Council. The council, staffed by a team of tech leaders from local academia, private business and government communities, will advise the governor and General Assembly on the state's S&T priorities, as well as address issues that impact the support and growth of an innovation economy.

To reduce administrative costs by up to $500,000 and to improve operational efficiencies, the Slater Fund Board of Directors has approved plans to consolidate Rhode Island's four Slater Centers into a single entity, the Slater Technology Fund, Inc. The fund will retain its four technology thrusts of biomedical technology, interactive technologies, design and manufacturing, and marine and environmental technologies.

Addressing a joint session of Rhode Island's General Assembly, Gov. Don Carcieri unveiled last week a fiscal year 2005 budget that includes funding for several technology-based economic development (TBED) initiatives.