SSTI Digest

The Economic Development Administration (EDA) in partnership with 15 other federal agencies and bureaus intends to commit $33 million in direct federal funding and provide technical assistance resources for the Jobs and Innovation Accelerator Challenge — a new public-private initiative focused on supporting and accelerating the growth of regional innovation clusters that exhibit high-growth development potential. Approximately 20 industry clusters will be selected through a nationwide competitive process that includes all industry sectors. Three agencies will provide direct funding with the additional 13 agencies and bureaus providing technical assistance resources to support customized solutions for each awardee. Challenge investments also are intended to serve as a catalyst for leveraging private capital in the regions from sources including foundations, financial institutions, corporations and other private sector partners. Sometime in May 2011, EDA will announce the competitive solicitation for this challenge. Read the Federal Register announcement or the press release...

U.S. Department of Energy (DOE) Secretary Steven Chu announced that DOE intends to commit up to $130 million to support advanced research projects on rare earth alternatives and breakthroughs in biofuels, thermal storage, grid controls and solar power electronics. The five new program areas supported through the Advanced Research Projects Agency-Energy's (ARPA-E) fourth round of funding include:

Generous individuals and foundations are stepping up to support university-based initiatives designed to expand research and encourage young people to create high-growth jobs at a time when operating budgets for higher education are facing drastic funding cuts across the U.S. Colleges in Michigan and Ontario will establish endowed chairs in medical research and entrepreneurship with funding from individual donors, and a 23-year-old former student of the University of Waterloo is launching a $1 million seed fund for student startups.

Gov. Rick Snyder signed into law a measure expanding the scope of the state's 21st Century Jobs Fund allowing more industries involved in research and advanced technology to compete for funds through the program. Although many tech-focused industries such as life sciences and alternative energy companies can already apply for funding under the program, the new legislation expands eligibility to include an even wider range of companies — information technology and agricultural processing. Additionally, the legislation gives the Michigan Strategic Fund Board flexibility to consider awarding grants and loans to any company that demonstrates significant advancement in any innovative technology, according to the governor's office. The 21st Century Jobs Fund is administered by the Michigan Economic Development Corporation to invest in high-tech industries and university research. In his budget proposal earlier this year, Gov. Snyder recommended level funding of $75 million for the program each year in FY12 and FY13. The enrolled version of SB 144 (Public Act 22) is available at: http://www.legislature.mi.gov/documents/2011-2012/billenrolled/Senate/pdf/2011-SNB-0144.pdf.

State business climate indices are a common tool in economic development policymaking and marketing. These indices allow analysts to bundle sets of business-friendly policies, quantitative metrics and subjective rankings into a single index to compare one state's business environment to another's. A recent paper by Jed Kolko, David Neumark and Marisol Cuellar Mejia suggests that many of the factors that are sometimes included in business climate indices have little or no predictive power. While factors related to taxes and costs have some correlation with economic growth, productivity-related variables have no bearing on growth, according to the authors. The factors that are most significant tend to be outside of the control of state policies, such as industry mix and population density.

U.S. venture capital investment per capita grew almost 19 percent in 2010 over the previous year, reaching $11.16. That increase, however, only represented a partial rebound from the plunging investment levels of 2008 and 2009. Last year's U.S. per capita figure was 28.7 percent lower than 2007 and 7.2 percent lower than 2005. The largest increases in per capita investment over the past five years occurred in the District of Columbia, Illinois, Delaware, Kansas and Iowa. Kansas, New York, Connecticut, Delaware and Pennsylvania had the largest increase in venture deals per million residents over the same period. For 2010, Massachusetts led the nation in both per capita dollars and deals per million residents.

The Department of Agriculture (USDA) and the Department of Energy (DOE) announced the Biomass Research and Development Initiative (BRDI) — a $30 million initiative to support up to 10 research and development (R&D) projects focused on advanced biofuels, bioenergy and high-value biobased products. Projects should propose integrated science and engineering research in three technical areas of interest:

On April 19, 2011, the U.S. Economic Development Administration (EDA) and the National Council of Entrepreneurial Tech Transfer (NCET2) held a webinar on the upcoming i6 Green competition. The competition will support regional economic development projects with a focus on energy-related industries and efforts that expand local networks. Unlike the first i6 Challenge, applicants do not have to represent new initiatives. The complete webinar, with slides, is available online at:

Last week, Maryland Gov. Martin O'Malley released the results of 18 months of work by the Maryland Economic Development Commission (MEDC), laying out the state's strategy for economic growth over the next five years. MEDC's five-year plan provides many economic development policy recommendations, but lists innovation, commercialization and entrepreneurship as the first three foundations for growth. Part of this strategy includes the implementation of InvestMaryland, a recently passed initiative that would generate more than $70 million for seed and growth stage companies. Read more about the strategy at: http://www.governor.maryland.gov/pressreleases/110414.asp

The U.S. Government Accountability Office (GAO) released their annual State and Local Governments' Fiscal Outlook and long-term projections paint a bleak picture. Even though both state and local government near-term fiscal outlooks have improved slightly since 2010, these sectors face long-term revenue declines that will necessitate "substantial policy changes" to stimulate revenue growth. According to the report, without policy changes, governments will face an increasing fiscal gap between receipts and expenditures in the coming years that would force across-the-board programmatic cuts. The primary long-term driver of fiscal challenges is the increasing costs of health-related costs. Based upon current and historical spending and revenue patterns, GAO's model projects the receipts and the expenditures for each sector until 2060. Since 2007, GAO has published long-term fiscal simulations for both the state and local sectors using National Income and Product Accounts data collected by the Bureau of Economic Analysis. Read the report...

Canada's innovation economy is at a critical junction, one that will require policymakers to choose what they want out of their science and technology (S&T) investments, according to a new study. The Toronto Region Research Alliance recently published a report that provides an analysis of S&T strategies in 10 countries, including the United States, the United Kingdom, China, South Korea, Israel, the Netherlands, India, various African initiatives, Germany and Finland. Each of these national S&T strategies are examined through the lens of the basic motivations behind their investments and how they relate to the policies that have been put in place. The report is intended to promote discussion in Canada about what the country needs from its S&T plan and how those needs can best be translated into effective policies.

International collaboration in science and technology (S&T) research has risen over the past 15 years from approximately 25 percent to over 35 percent, according to Knowledge, Networks and Nations: Global Scientific Collaboration in the 21st Century — a new report from the Royal Society Science Policy Center. The special advisory group established by the Royal Society analyzed data that include research articles in international journals, citations in those articles, national rates of patent registration, number of researchers per nation, national expenditures on research and development (R&D) and the impacts of S&T research. Data was collected using several methods and sources including a call for evidence, data mining and face-to-face and telephone interviews.