Legislative Wrap-Up: Louisiana, Massachusetts, Pennsylvania and Tennessee Pass Budgets

Several states recently enacted spending plans for the upcoming fiscal year, which started July 1 for most states. In Louisiana, Gov. Bobby Jindal signed into law the LA GRAD Act, granting universities more flexibility to raise tuition in return for meeting certain performance goals. Lawmakers in Massachusetts allocated $10 million to continue the state's investment in life sciences, Pennsylvania Gov. Ed Rendell signed a jobs bill providing $8 million for green economy projects, and in Tennessee, an $80 million expansion of TNInvestco, a program that allocates tax credits to create pools of venture capital, was approved.

Louisiana

Starting with the 2011fiscal year, Louisiana universities can begin raising tuition and fees in exchange for achieving specific, measurable performance objectives to improve graduation rates, better meet the state's current and future workforce and economic development needs, and increase research productivity. The Louisiana Granting Resources and Autonomy for Diplomas (LA GRAD) Act allows the universities to increase tuition and fees by up to ten percent annually, without legislative approval, until they reach the average cost of their regional peers.

The median tuition and fees for an undergraduate at a four-year college in Louisiana was $3,595 in 2007-08, compared to a Southern regional average of $4,980, reports NOLA.com.

Under the new law, all public postsecondary institutions are given the option to enter into a six-year performance agreement with the Board of Regents. Increasing research productivity in key economic development industries and designating Centers of Excellence are among the performance objectives included in the enacted bill.

Massachusetts

The $27.6 billion FY11 spending plan signed into law last month by Gov. Deval Patrick includes funding to support the $1 billion Life Sciences Initiative, a 10-year commitment to position the state as a global leader in life sciences established two years ago by the governor (see the issue of June 18, 2008 issue of the Digest). The Massachusetts Life Sciences Center, a quasi-public agency charged with implementing the initiative, will receive $10 million in FY11, the same as last year. The appropriation is contingent upon a consolidated net surplus for FY10. The Center has so far committed $188 million in state funds, leveraged more than $700 million in additional outside investment, and created a projected 6,500 jobs, according to a press release. The full budget can be viewed at http://www.mass.gov/bb/gaa/fy2011.

Pennsylvania

Gov. Ed Rendell last week signed a jobs bill that authorized projects for funding through the Redevelopment Assistance Capital Program, including up to $8 million for Pittsburgh Green Innovators, a group of local stakeholders working to provide space to research, develop and showcase renewable energy and energy efficiency technologies. When complete, the $16.5 million project also will provide a teaching environment for college students and workers seeking to enter the green economy. A small business incubator is expected to launch up to five companies per year.

The FY11 enacted budget includes $16.9 million for the Ben Franklin Technology Development Authority Fund, down from $20 million last year. Funding is distributed evenly among four regional centers. Industrial Resource Centers are slated to receive $6.9 million, down from $7.65 million in FY10. These seven centers were established to help small- and medium-sized manufacturing enterprises respond to changing markets and new technologies in the global economy.

Budget documents are available at: http://www.portal.state.pa.us/portal/server.pt/community/current_and_proposed_commonwealth_budgets/4566.

Tennessee

Gov. Phil Bredesen recently signed SB 3049, providing an $80 million expansion of the year-old TNInvestco program, which allocated $120 million dollars in tax credits to six venture capital firms last November. With the additional funds, four more firms will be awarded $20 million in tax credits each, reports the Nashville Business Journal. The program seeks to develop the entrepreneurial infrastructure across the state, attract new capital, and create jobs through the development of innovation clusters.

The $29 billion FY11 budget signed into law by Gov. Phil Bredesen last month includes $6.2 million over three years to establish a graduate energy sciences and engineering program expected to create 200 faculty appointments for Oak Ridge National Laboratory researchers at the University of Tennessee at Knoxville (see the Feb. 17, 2010 issue of the Digest).

The University of Tennessee (UT) System budget allocates $10.9 million (down from $11.2 million) for UT Research Initiatives, which includes operational funds for the UT Biofuels Initiative. Another $8.3 million is allocated for the UT Space Institute, the same as last year. The Centers of Excellence program is slated to receive $18.2 million, down from $19.6 million last year.

Appropriations within the Department of Economic and Community Development include $9.3 million for the Tennessee Job Skills Program, a workforce incentive grant program focused on enhancing employment opportunities and meeting the needs of new and existing industry, and $340,500 for FastTrack Infrastructure and Job Training Assistance, the same as last year.

The appropriations act, Public Chapter No. 1108, is available at: http://state.tn.us/sos/acts/106/pub/pc1108.pdf.