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RI Gov Backs $51M Plan to Jumpstart State’s Innovation Economy

February 11, 2016

Last week, Rhode Island Gov. Gina Raimondo proposed more than $51 million in investments focused on reinvigorating the state’s economy through innovative industries with the release of her fiscal year 2017 budget request. The governor’s Make It in RI jobs plan incorporates many of the recommendations from a strategic plan developed by the Metropolitan Policy Program at Brookings, Battelle Technology Partnership Practice (now TEConomy Partners, LLC) and Monitor Deloitte. One of the key investments is a $20 million brick-and-mortar innovation district where entrepreneurs, businesspeople and academics can interact.

In her budget address last week, Gov. Raimondo strongly backed the idea that advanced industries and cutting-edge research were vital to modern economic prosperity. “It’s pretty simple,” she said, “Advanced industry jobs create high wages and economic growth.” In order to stimulate employment in those industries, the governor introduced a number of proposals based on Rhode Island Innovates: A Competitive Strategy for the Ocean State, prepared by Brookings, Battelle and Deloitte.

The authors of the report identify a number of industries for strategic investment, including five “advanced industries” that are focused on R&D and promise high-wage, high-skill jobs, and two “opportunity industries” that provide good wages for workers at all levels of educational attainment. Strategic advanced industries for Rhode Island include:

  • Biomedical Innovation;
  • IT/Software, Cyber-Physical Systems and Data Analytics;
  • Defense Shipbuilding and Maritime;
  • Advance Business Services; and,
  • Design, Food and Custom Manufacturing.

Opportunity industries include:

  • Transportation, Distribution and Logistics; and,
  • Arts, Education, Hospitality and Tourism.

The authors posit that Rhode Island leaders should adopt a three-pronged approach to stimulate the growth of these industries. First, a Rhode Island Innovation initiative would boost the state’s innovation capacity and workforce though investments in STEAM education, entrepreneurship and collaboration. Second, a Rhode Island Competes initiative would improve the environment for innovative businesses by streamlining regulations, improving site-selection efforts, modernizing rail infrastructure and expanding the state’s R&D tax credit. Finally, a Rhode Island Acts initiative would create a privately led vehicle for future initiatives.

The governor’s $9 billion FY 2017 budget request, and the associated Make It in RI plan, incorporates many of these recommendations. The proposed innovation district, in a location yet to be determined, would be funded by a $20 million bond referendum in November, according to the Providence Journal. Additional funding would come from private sources. Rhode Island businesses or institutions could apply to participate, with preference given to applicants from the five advanced industries provided in the strategic plan. Out-of-state participants would need a local partner.

The governor’s plan also includes a $5 million expansion of the state’s R&D tax credit, recruitment of commercialization-focused university faculty and a new engineering school at the University of Rhode Island. The Wavemaker Fellowship program to pay down student loans in STEAM fields would be expanded, as would the TechHire initiative to connect low-income job seekers to training programs, and the Innovation Vouchers program to connect businesses and academic researchers.

In addition to the jobs plan funding, the proposed FY17 budget would provide a total of $83.6 million for the state’s Executive Office of Commerce, including $35 million for an Economic Development Initiatives Fund, $13.8 million for Commerce Economic Initiatives, and $13 million for Quasi-Public Agencies. The Economic Development Initiatives Fund is a two-year fund to support economic development programs, started in FY 2016. The FY 2017 request would bring the fund total to $78.5 million. Quasi-Public Agencies funding includes $7.5 million for the Rhode Island Commerce Corporation and $4.3 million in pass-through grants for programs under the Commerce Corporation. The corporation is a full-service economic development organization for the state, which would receive a total of $22.3 million in state appropriations in FY 2017. Pass-through programs under the corporation include $1.2 million for the STAC Research Alliance, $1 million for Innovative Matching Grants and $2.4 million for the Renewable Energy Fund.

 

 

Rhode Islandstate budget, state tbed