Governor's Economic Development Plan to 'Energize Indiana'

Indiana Governor Frank O'Bannon unveiled a plan earlier this week to "Energize Indiana" that relies heavily on tech-based economic development.  Gov. O'Bannon's Energize Indiana plan is a $1.25 billion, 10-year initiative that seeks to create high-skill, high-wage jobs in four industry sectors to which Indiana has a claim – advanced manufacturing, life sciences, information technology and 21st century logistics (high-tech distribution) – and to prepare the state's workforce to fill them.   Of the $1.25 billion, $610 million is directed toward supporting university research, university-industry partnerships, construction of university research facilities, and scholarships in targeted fields.

Energize Indiana will tap several financial sources to accomplish its goals, but not state tax money. The plan calls for the sale of bonds to generate money for these measures, using as collateral some of the future payments from the settlement of the nationwide lawsuit against the tobacco industry. It would use part of the money already on deposit in a tobacco settlement trust fund, or $195 million of the $277 million available, to pay off the bonds over time. Health programs presently supported by 60 percent of the tobacco payments would be left untouched; the other 40 percent goes into the trust fund.

The plan also calls for using federal economic stimulus money; encourages the Public Employees Retirement and the Teachers Retirement funds to invest in certain business ventures; and encourages the Indiana Port Commission to sell bonds to invest in companies in the four targeted industrial sectors.

Among other endeavors, Energize Indiana is expected to jump-start the 21st Century Research and Technology Fund. A total of $360 million is dedicated to the fund, which encourages technology transfer among the state's universities and businesses. The fund would receive $32 million in the first year of Gov. O'Bannon's plan and would taper to $18 million a year in the final year.

The governor's plan also provides $135 million for college scholarships for as many as 22,000 students who pursue studies or internships in the four targeted areas and who remain in Indiana after graduation. Up to $115 million is set aside for universities to build new research buildings and technology parks, as well.

Because many parts of Energize Indiana will evolve over 10 years and many of its initiatives will take many more years to be realized, it will be difficult to measure the success of the plan, proponents say. Using the experience of other states and other data, however, proponents hope the measures within the plan will create 200,000 new jobs in the four targeted sectors over the next decade; enroll 200,000 more students in higher education or credentials programs; and cause the state's per capita income to grow at a rate faster than the national average.

Links to the governor's speech on Energize Indiana and a booklet highlighting the plan's initiatives are available through the plan's initial Dec. 4 release at: http://www.in.gov/gov/energize/index.html