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Legislative Wrap-Up: Georgia and Kansas

May 26, 2010

Lawmakers in Georgia and Kansas recently approved scaled-back funding for their states' respective tech-based economic development (TBED) programs in the coming fiscal year. Although many states are struggling to fill large deficits in the aftermath of a national economic downturn, funding for TBED initiatives, even at reduced levels, continues to be a priority for most states as a means to grow and diversify the economy.

Lawmakers recently approved a $17.9 billion budget for FY11, an increase of $800,000 over the amended FY10 budget. Tackling a budget deficit of more than $1 billion at the start of the session, lawmakers cut funding across several state agencies, including those focused on economic development. Many of the reductions to university-based research initiatives were in line with Gov. Sonny Perdue's recommendations (see the Jan. 20, 2010 issue of the Digest). The Georgia Research Alliance, a public-private partnership that acts as Georgia's lead science and technology initiative, is slated to receive $18.25 in FY11, down from $23.9 million in FY10.

The approved budget allocates $21.1 million in total funding for the Advanced Technology Development Center/Economic Development Institute, which includes $8.1 million from state general funds. This is down from $11.8 million in state funds approved last year. Funding for the seed capital fund is eliminated ($2.5 million) in the approved budget.

Partial funding was restored for two Science, Technology, Engineering and Mathematics programs within the Department of Education. Georgia Youth Science and Technology is slated to receive $150,000 down $100,000 from FY10 and the National Science Center and Foundation will receive $200,000, down $300,000 from last year.

A bill to create a Legislative Economic Development Council was passed earlier in the session. The council is charged with evaluating the state's overall economic development strategy.

HB 1069, passed by the legislature, would provide a tax credit of up to $50,000 for individuals who invest in innovative startup companies. The bill awaits action by the governor.

The conference committee substitute to HB 948 (the FY11 appropriations bill) is available at: http://www.legis.state.ga.us/legis/2009_10/house/budget/reports/FY_2011_Bill_Final_Conf_Cmte.pdf.

Kansas legislators approved a revenue enhancement package that includes raising the state's sales tax by one cent to 6.3 percent beginning July 1. Earlier this year, Gov. Mark Parkinson warned of deep cuts across several state agencies in absence of a revenue package (see the Jan. 20, 2010 issue of the Digest). The measure is expected to generate an additional $303.6 million in state revenue to help fill the budget shortfall.

The FY11 budget approved by lawmakers includes $6 million for the Kansas Technology Enterprise Corporation (KTEC) from the Economic Development Initiatives Fund (EDIF), down from an estimated $7.75 million last year. The KTEC Board of Directors will set program allocations in alignment with current strategy at its June meeting.

Kansas, Inc., which conducts economic development planning, policy research and program evaluation, is slated to receive $346,904, a slight increase from last year. Additionally, $10 million is approved for Wichita State University Aviation Research and Aviation Classroom and Training Equipment through the EDIF.

The transfer to the Kansas Bioscience Authority (KBA) is $35 million in the approved budget. KBA recently announced plans for $36.9 million in new financing commitments for bioscience researchers and businesses during FY11, reports Kansas City Business Journal.

SB 572 is available at: http://www.kslegislature.org/bills/2010/572.pdf.

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