AL, CT, FL, MI, MO, OK, PA and WI budget proposals boost and cut TBED

In the latest round of state budget proposals, TBED initiatives receive mixed reviews. Some governors are boosting funding while others in cash-strapped states are proposing cuts.

Alabama

Gov. Robert Bentley’s FY 2018 budget would boost spending on education, provide government workers a cost of living adjusted raise, and remove the sales tax on groceries. Notable for technology-based economic development is $2.9 million for the Alabama Innovation Fund in FY 2018, an increase of 20.1 percent from FY 2017. The fund operates two programs: a renewal program, which helps support university high technology infrastructure, and a research program, which allocates funding for commercialization and university-industry partnerships.   Additionally, the Alabama Technology Network would receive $4.9 million in FY 2018, the same as it received in the previous fiscal year.

Connecticut

Faced with a $1.7 billion deficit, Gov. Dannel Malloy’s $20 billion FY 2018-2019 biennial budget includes little in the way of new funding. The state’s Department of Economic and Community Development would receive $29.9 million in FY 2018 and $29.3 million in FY 2019, roughly 9.5 percent less than the department received in FY 2017.  For the department, the state’s capital budget would provide funding through bonds in the following programs:

• $375 million for the Economic Development and Manufacturing Assistance Act, with $200 million in FY 2018 and $175 million in FY 2019;
• $35 million for the Small Business Express program, with $25 million in FY 2018 and $10 million in FY 2019, to support the retention and growth of small businesses;
• $30 million for the Bioscience Innovation Fund, with $15 million in each fiscal year;$28.3 million for the Bioscience Collaboration Program with $15.8 million in FY 2018 and $12.5 million in FY 2019; and,
• $10 million for the Connecticut Manufacturing Innovation Fund, with $5 million each fiscal year.

After receiving $735,478 in the previous biennium, the state’s small business incubator program within the Department of Economic and Community Development would receive no funding in FY 2018-2019. CONNSTEP, the state’s MEP center, would receive $780,942, with $390,471 each fiscal year, down from the adjusted $447,275 FY 2017 budget. At the Connecticut Center for Advanced Technology (CCAT), the Manufacturing Supply Chain program would receive $347,082 in FY 2018 and $173,541 in FY 2019, a 51.5 percent reduction from FY 2017. CCAT’s Hydrogen Fuel Cell Coalition would receive no funding after receiving $150,254 in FY 2017.

Florida

In Gov. Rick Scott’s FY 2017-2018 budget proposal, the state would commit up to $1.3 billion in funding for the Florida Department of Economic Opportunity including $697 million for economic development activities and $498 million for workforce services. Under economic development activities, the state would commit up to:

• $80.5 million for Enterprise Florida;
• $19.5 million for Space Florida;
• $1 million for the Institute for Commercialization of Public Research; and,
• $500,000 for FloridaMakes, the state’s MEP center.

The Florida Consortium of National Institute Cancer Program would receive $45 million as well as an additional appropriation of $10.6 million in funding for the Morffit Cancer Center.

Michigan

Gov. Rick Snyder’s $56.3 billion proposed FY 2018 budget (2.5 percent increase from FY 2017) includes $10.1 billion in general fund spending (1.8 percent increase) and makes targeted investments in higher-education, workforce, and economic development.

The Department of Talent and Economic Development would receive roughly $1.1 billion in total funding (0.2 percent decrease), of which 41 percent would go toward workforce development. Approximately 11 percent of the department’s budget ($125.5 million) would go to business attraction and community revitalization, while an additional 11 percent ($122.5 million) would go toward other economic development programs. Examples of programs receiving funding include:

• $40.9 million (32 percent increase) for the Going Pro Program, a job training program that focuses on high-demand occupations;
• $5 million in one-time funding to market Michigan to out-of-state talent; and,
• $1 million (67 percent decrease) for the Protect and Grow initiative, which focuses on growing and retaining Michigan’s defense industry.

To support K-12 education, the governor recommends $8.8 million for STEM initiatives within the MISTEM network. This includes:

• $3 million for offering STEM-related opportunities to pupils statewide;
• $2.8 million to support restructured regional STEM Centers;$2.5 million for FIRST Robotics, an international robotics competition; and,
• $500,000 for computer science programs throughout the state.

Missouri

Gov. Eric Greitens’ first budget proposes $572 million in cuts for FY 2018. The Missouri Technology Corporation (MTC), which oversees the state’s Innovation Centers, Manufacturing Extension Partnership center, capacity-building grants and investment funds, would have its budget reduced from $22.9 million in FY 2017 to $5.0 million in FY 2018. This reduction may virtually eliminate new state-backed investments ($10 million in FY 2017), reduce the availability of capacity grants ($3.5 million in FY 2017), and cause cuts to the Innovation Centers and MEP ($3.3 million in FY 2017). Also within the Department of Economic Development, the Governor would reduce workforce training programs by $1.7 million in FY 2018.

Greitens’ proposed budget also significantly reduces spending for higher education. While programs to fund students graduating from “A+” high schools or passing STEM AP tests are preserved, all of the state’s higher education “initiatives” (a budget category for specific projects) — including funds to support engineering, science, tech and cyber security programs — are set to $0 in FY 2018, and public community colleges ($151.9 million in FY 2017; $143.0 million in FY 2018) and universities ($776.8 million in FY 2017; $733.4 million in FY 2018) see cuts. The state’s historically black colleges and universities (HBCUs) experience the greatest proportional losses in this proposal.

Oklahoma

In December 2016, state officials projected that available revenue for FY 2018 appropriations would be 12.2 percent less than the amount appropriated for FY 2017. With a mix of new revenue sources and reductions in some areas, Governor Mary Fallin’s budget proposal puts state spending at $7.0 billion, a 3.2 percent increase over FY 2017. Oklahoma’s tech-based economic development agency, the Oklahoma Center for the Advancement of Science and Technology (OCAST), would receive flat funding of $14.1 million under the governor’s budget proposal.

Pennsylvania

Facing a $3 billion budget deficit, Pennsylvania Gov. Tom Wolf released his FY 2017-2018 budget proposal. Among the austerity measures proposed by Wolf, the state would convert several popular state tax credit programs into a block grant programs overseen by the Department of Community and Economic Development (DCED). While the governor’s budget proposal is unclear about which tax credits would be converted, several innovation-focused programs could be impacted including the state’s R&D tax credit and the Keystone Innovation Zone tax credits.

To support the state’s economic development activities, the budget includes $491.6 million in total funding for the DCED including $251 million in federal funds. The proposed funding for DCED would include $12 million in new funding to establish the Manufacturing PA initiative – a new partnership between DCED, research institutions, community colleges, and other training providers to support growth of the state’s manufacturing sector.

Of the $12 million for Manufacturing PA, $5 million in grants would be made through the proposed manufacturing training-to-career grant program. Under the program, PA manufacturers would be provided grant funding to partner with institutions of higher education to link job training to manufacturing career pathways. In addition to workforce training through Manufacturing PA, Wolf also proposes $4 million to expand apprenticeship opportunities including grants of up to $2,000 for each federally registered apprentice hired by a PA-based business.

In total, Wolf proposes $43.5 million** for the Ben Franklin Technology Development Authority Fund with $29 million coming from Innovate in PA tax credit sale proceeds. Under the proposed budget, DCED will transfer $14.5 million in state general funds to the Ben Franklin Technology Development Authority.

DCED’s Pennsylvania First program, which offers capital funding for local job creation projects, would be funded at $20 million in general funds. The Partnerships for Regional Economic Performance (PREP) program would receive $9.8 million. PREP funds a number of local and regional business assistance partners, including the Manufacturing Extension Partnership’s (MEP) Industrial Resource Centers, Small Business Development Centers, Industrial Development Corporations and Local Development Districts. DCED would provide $3 million in funding from the state’s Tobacco Settlement Fund to the Pennsylvania Life Sciences Greenhouse Initiative, which supports three regionally based organizations in central Pennsylvania, Pittsburgh and Philadelphia.

The governor also proposes $11 million in new funding for Smart Cities grants to develop a network of smart corridors to improve connections between neighborhoods and major centers of employment and health care services.

Wisconsin

Gov. Scott Walker’s FY 2017-2019 budget includes spending increases for the Wisconsin Economic Development Corp. (WEDC; FY 2016: $29.8 million, FY 2017 and 2018: $35.3 million; FY 2019: $41.6 million), while proposing changes to program policy. The state’s Angel and Early Stage Seed Credits would apply to the first $12 million of each business’ investments instead of the current $8 million, and WEDC would be given permission to carry any unused credits into the next year (estimated to reduce state revenues by $3.2 million in FY 2018 and $2.2 million in FY 2019). WEDC would be prohibited from forgiving loans, and new loans would only be allowed from funds collected on currently outstanding debt.

Walker’s budget would also significantly alter the state’s higher education systems in ways that emphasize cost and employment. The University of Wisconsin System (FY 2016: $6.0 billion, FY 2017: $6.1 billion, FY 2018 and 2019: $6.2 billion) would implement a 5 percent tuition cut in FY 2018, with the lost revenues offset by an additional $35 million in state funding. Universities would also be able to compete for $42.5 million in performance funding, targeting metrics that include improving affordability, enhancing work readiness and graduates finding jobs. Policy-focused budget proposals include requiring the System to create pathways for graduation in three years for 10 percent of programs by 2018 and 60 percent by the end of June 2020* and to require an internship for all Bachelor’s degrees. Universities would also be required to track and report an array of performance metrics.

The budget makes similar proposals for the Wisconsin Technical College System (FY 2016: $543.6 million, FY 2017: $558.2 million, FY 2018: $562.2 million; FY 2019: $561.9 million). Tuition would be frozen for the biennium, with lost revenues partially offset by a $5 million increase in state funds as well as a new $5 million program in FY 2017 for the Department of Workforce Development to make grants to the colleges to fund collaborative projects focused on providing high school students with certifications in high-demand fields. The colleges would also have an existing performance-based funding model adjusted to include workforce readiness and student success in the workforce. A new policy would also enable these colleges to provide tuition rates to local students that are lower than the statewide rates.

In addition to the new Department of Workforce Development grant initiative for the Wisconsin Technical College System, the Department would receive an additional $5.0 million in FY 2017 (FY 2017: $32.1 million). The purpose of this new funding would include adding a registered apprenticeship program to the state’s workforce tools.

* ​Correction: The article originally stated FY 2019.

​**Correction: The orginal article stated an incorrect amount.