MD, SC Boost Defense Industry Support in Budgets; TBED Proposals Released in AZ, MO

Many governors around the country have begun laying out priorities for the next legislative session. In the coming weeks, SSTI will review gubernatorial addresses and budget proposals related to economic development. This week, we highlight developments in Arizona, Maryland, Missouri and South Carolina.

Arizona
Last week, Gov. Doug Ducey released his $9.5 billion budget proposal for fiscal year 2017 and presented his second State of the State Address. The governor highlighted his office’s work in reducing spending, offered several tax-reduction proposals and pushed for additional funding for the state’s child safety system and a boost for K-12 education. Gov. Ducey also noted that immediately before his address, he signed an executive order creating the Governor’s Council on the Sharing Economy, to help encourage growth and innovation in this emerging economic sector. The council will develop recommendations to help improve the environment for businesses based on ridesharing and other peer-to-peer services.

Under the proposed budget, the Arizona Commerce Authority would receive $48.7 million, including $21.8 million from the general fund and $26.9 million in non-appropriated funds. In his address, the governor pitched an overhaul of the authority, focused on marketing and promotion. His budget includes $9.5 million in non-appropriated funds for the Arizona Competes Fund and $267,000 for the Arizona Innovation Accelerator Fund.

Maryland
Gov. Larry Hogan released his $17.1 billion operating budget proposal for fiscal year 2017 this week. Gov. Hogan noted that the budget would fully fund the state’s educational formulas, while increasing support for community colleges and institutions of higher education. The governor also touted the proposal’s $20 million for aerospace and defense research through the Economic Development Opportunity Fund and $6.3 million for business assistance through the Maryland Small Business Development Financing Authority. The budget includes $12 million for the state’s biotechnology tax credit and $2 million for the cybersecurity tax credit.

The Maryland Technology Development Corporation (TEDCO) would be appropriated $4.7 million for operations, including $1.1 million for BioMaryland grants. Another $9 million would be available for the TEDCO-managed Stem Cell Research Fund, and $4.8 million would support the Maryland Innovation Initiative. TEDCO’s Cybersecurity Investment Fund would receive $900,000, while $7.3 million would be allotted for the administration and disbursements of the Enterprise Investment Fund and Challenge Programs.

Missouri
Gov. Jay Nixon delivered his final State of the State speech and offered his $27.3 billion fiscal year 2017 budget proposal. In his address, the governor specifically cited the success of the Missouri Technology Corporation (MTC) in helping the state buck the national trend of declining business creation. He pledged to increase support for the organization by $10 million to further bolster entrepreneurship.

The budget would provide $388.4 million for the state’s Department of Economic Development, including $97.6 million in state general revenue funds. Much of the remaining funding would derive from federal funds. The Department’s Business and Community Services Division would receive $168.4 million in total funding ($66 million in general revenue funds), including $28.4 million for the MTC investments.  MTC-supported programs include the state’s Innovation Centers and the Manufacturing Extension Partnership affiliated with the University of Missouri System.

South Carolina
Gov. Nikki Haley released a $7.5 billion budget proposal for fiscal year 2017 last week. The governor highlighted the inclusion of $13 million for the Department of Commerce’s Closing Fund to help attract new businesses, $13.5 million for the ReadySC workforce training initiative and $5 million for the Pathways Initiative to provide workforce scholarships. Another $300,000 in Department of Commerce funding would support business diversification for firms in the defense sector. Funding would stay level for both the state’s Jobs-Economic Development Authority at $423,000, and SCMEP at $932,049.