More governors seek to boost innovation with increased funding

Alabama, Minnesota and Pennsylvania governors are proposing new or increased funding for innovation initiatives. Alabama could see a substantial increase in its Alabama Innovation Fund, while Minnesota’s governor is looking to boost the state’s startup ecosystem and Pennsylvania would increase funding for the Ben Franklin Technology Partners, which has worked for more than 30 years to grow the state’s innovation economy.

Alabama Gov. Kay Ivey, in her FY 2023 Executive Budget, recommends $32.4 million for the Alabama Innovation Fund, a $20 million increase over the approved amount in FY 2022. Innovate Alabama and the Alabama Innovation Corporation (both established in 2021) receive funding via the Alabama Innovation Fund. The Innovate Alabama Matching Grant Program would make matching grants of up to $250,000 to businesses and organizations that received SBIR or STTR grants. Last year Ivey signed legislation establishing the Alabama Innovation Corporation, a public-private partnership to serve as a catalyst for the state’s growing innovation economy, along with legislation that created the Innovate Alabama Matching Grant Program to promote research and development in the state.

In his FY 2022-2023 supplemental budget proposal, Minnesota Gov. Tim Walz has recommended a $35 million increase in the Department of Commerce " to create a 10-year Decarbonization Technology Investment Fund to: (1) stimulate research and development of renewable electric energy technologies; (2) encourage grid modernization, including, but not limited to, projects that implement electricity storage, load control, and smart meter technology; and (3) stimulate other innovative energy projects that reduce demand and increase system efficiency and flexibility. The fund’s investments will be directed by an investment committee made up of Commerce, the Department of Employment and Economic Development (DEED), utilities, research institutions, and private investors. An advisory committee made up of research institutions, labor, and other stakeholders will establish the specific uses of the fund." 

Walz also recommended one-time funding of $5 million for Launch Minnesota to invest in the startup ecosystem in the state. Launch Minnesota is comprised of a collection of grant programs, education and training, and a statewide network to connect and grow Minnesota’s startup community. Staff would engage businesses, higher education institutions, investors, and communities to create industry focused accelerators that provide resources and technical assistance to help businesses grow.

In Pennsylvania, Gov. Tom Wolf’s proposed FY 2022-2023 state budget has proposed $32.5 million in general fund monies (a substantial increase over the $14.5 million recommended and legislatively approved for the past several years) for the Ben Franklin Technology Development Authority (BFTDA), which funds the statewide economic development initiative and provides competitive grants to support high-tech ventures.

According to the budget document, “An additional $10 million directed to the Ben Franklin Technology Development Authority will be driven out competitively to achieve new levels of innovation and collaboration with institutions of higher education. Additionally, each of the four Ben Franklin Technology Partners will receive a $2 million funding increase to provide additional resources for critical seed funding to innovation companies."

The governor’s budget also includes $11.3 million for Partnerships for Regional Economic Performance (an increase of $1.5 million over previous years) to support partnerships with higher education institutions to drive up "accelerator participation, entrepreneurial internships, decreased student outmigration, and business incubation."