House hearing expresses support for regional innovation

In a hearing this week, lawmakers expressed bipartisan support for EDA’s innovation programs and for providing appropriations for the newly-authorized Regional Innovation and Technology Hubs. On Dec. 14, the House Subcommittee on Research and Technology held a hearing on “Building Regional Innovation Economies.” This panel, convened by subcommittee Chairwoman Haley Stevens, emphasized the Economic Development Administration’s Build to Scale, Build Back Better Regional Challenge and newly-authorized Regional Technology and Innovation Hubs (Tech Hubs) programs. The witnesses, who included EDA administrator Alejandra Y. Castillo, spoke to the significant and positive impact EDA funding has had for local economies.

This hearing was a follow-up to last summer’s session, in which SSTI president and CEO Dan Berglund testified, before the CHIPS and Science Act authorized Tech Hubs and before EDA made its Build Back Better Regional Challenge awards. During this week’s hearing, members of the science committee from both sides of the aisle seemed supportive of EDA’s role in encouraging regional innovation and interested in further funding for the agency.

Chairwoman Stevens opened the panel by stating her support, saying: “I am so proud of the multitude of bipartisan provisions this committee advanced in the CHIPS and Science Act… I recognize that Congress still has work to do to fully fund the appropriations the bill authorized.” Similarly, Rep. Frank Lucas — expected to be the full science committee chair next year — ended his time by saying he wanted to work with the EDA administrator and others to make the case for Tech Hubs to appropriators.

In written testimony, Administrator Castillo stressed the importance of Build to Scale as EDA’s “flagship program for enabling innovation,” and highlighted the potential for Tech Hubs to build from existing programs, as well as the National Science Foundation’s Regional Innovation Engines, to be a “key part of the nation’s innovation enterprise.” Her testimony also identified synergy between EDA’s innovation programs — largely authorized by the science committee — and EDA’s public works investments, arguing that as technology has moved into physical products, infrastructure is critical for the production and transportation of those products.

Several committee members asked about the role federal funding plays in supporting the work of state and local stakeholders. David Spalding, Dean of the College of Business at Iowa State University (ISU), discussed federal funding as helping to seed initiatives that could then look to sustained support from the state, and the role that local organizations have played in preparing and referring entrepreneurs to ISU’s Build to Scale-funded programs. Answering a similar question, Detroit Regional Partnership President and CEO Maureen Donohue Krauss discussed local economic development organizations — and their willingness to work together — as a particular strength for her region.

Spalding’s written testimony emphasized the impact that ISU’s two Build to Scale awards have had for companies in the region. ISU’s Startup Factory, supported by a 2017 grant, worked with 29 companies focused on food and food safety, and these companies raised more than $11 million in investments, grants and loans while creating 80 jobs. Iowa Go 2 Market, funded with a 2020 award, has put nine companies through an accelerator, four of which have already raised capital and/or won state and federal research awards. More importantly, the Startup Factory and Go 2 Market programs have been able to continue operations and now count 38 SBIR awards, 26 angel investment rounds and several successful exits among their ongoing impact.

Linda Olson, President/CEO of Tampa Bay Wave, also testified at the event, speaking to the catalytic role that Build to Scale played in helping the organization move from the vision stage to the regional driver of innovation and entrepreneurship that it is today. Tampa Bay Wave’s EDA awards have enabled the organization to run 28 accelerator cohorts and form a $25 million seed fund, which have assisted the creation and growth of numerous companies.