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TBED Election Issues across the States

October 25, 2004

While the presidential election has been dominating the news, voters across the country will be acting on an array of tech-based economic development issues on Election Day next week. The largest is an initiative in California that would provide up to $3 billion for embryonic stem cell research. If approved by California voters, Proposition 71 would have the potential of significantly changing the landscape of where stem cell research is carried out and have significant economic development implications.

Under current federal regulations, federal funding for embryonic stem cell research is limited to a specific set of already existing lines. With $300 million in new state funding for the next 10 years, Proposition 71 could prove to be an irresistible force for researchers, setting California up to be the focal point for stem cell research in the U.S. Even if federal restrictions are eased, California's funding may put it in a dominant position as it will be better able to leverage funding from the National Institutes of Health.

Other significant ballot measures are highlighted below:


Voters will decide on a constitutional amendment to allow for transfer of newly developed technologies at public universities to the private sector. Arizona’s constitution currently prohibits universities from accepting stock or other equity from private companies as consideration for the transfer of university-developed technology. Gov. Janet Napolitano supports Proposition 102 as a means to stimulate the economy and attract new businesses to the state.


Amendment Two would allow the General Assembly to approve the issuance of general obligation bonds to fund the infrastructure necessary for any economic development project in which a company commits to hire at least 500 new employees and invest more than $500 million in capital expenditures. The maximum amount of bonds that could be issued would be equal to 5 percent of the state general revenues during the most recent year, which currently is about $200 million in bonds. Emerging technologies such as nanotechnology and biotechnology could benefit from the amendment, proponents argue.


As mentioned earlier, Proposition 71 would establish the California Institute for Regenerative Medicine to regulate stem cell research and provide funding through grants and loans for research and research facilities. Also included in the proposition is the constitutional right to conduct stem cell research; establishment of an oversight committee to govern the Institute; a general loan fund of up to $3 million for initial administration and implementation costs; authorization to issue general obligation bonds to finance Institute activities of up to $3 billion; and appropriation of monies from the General Fund to pay for the bonds. Gov. Arnold Schwarzenegger recently announced his support for the measure (see the June 7 issue of the Digest).

Separate ballot initiatives to prohibit the propagation, cultivation, raising or growing of genetically modified organisms are being considered in four California counties. The ordinances would make it unlawful for any person, firm or corporation to propagate, cultivate, raise or grow genetically modified organisms. Genetically modified organisms are defined as specific organisms whose native intrinsic DNA has been intentionally altered or amended with non-species specific DNA. If the Humboldt County measure passes, harvesting biotech crops would be considered a criminal charge, constituting a fine or possible jail time. Following Mendocino County, which passed the nation’s first ban in March, the counties of Butte, Marin and San Luis Obispo would call for a fine and destruction of the biotech crops if the measures pass.


Voters in Maine will decide on Question 1, which would limit property taxes to 1 percent of the assessed value of the property. This initiative limits the ad valorem taxes levied on real or personal property to a maximum rate of 1 percent of the value of the property. The base value of the property would be the 1996-97 assessed value. The initiative also would prohibit any change in the maximum property tax rate except by a two-thirds vote of all voters in a statewide referendum. The Maine Center for Economic Policy says estimates indicate the proposal would require reducing local revenues by at least $600 million, or one-third of current tax collections. Proponents argue that by instituting a 1 percent tax cap, property tax bills would become predictable and would remain at a reasonable level.

Rhode Island

Approval of Ballot Question 13 would allow the State of Rhode Island to authorize $50 million in bonds for the creation of a biotechnology and life sciences center at the University of Rhode Island. The Rhode Island Technology Council and the University have campaigned for the referendum, saying it is crucial to the state. Creating competition for the measure are 11 other initiatives seeking voter approval for issuance of bonds. According to the University of Rhode Island, the 165,000-square-foot facility will house classrooms, high-tech specialty laboratories, core support instrumentation, faculty offices, incubator space for technology commercialization, and a 400-seat auditorium. It also will support new scientific discoveries, provide work force training, and support job creation in the life sciences.


Similar to Proposition 102 in Arizona, Utah’s Amendment Two would amend the constitution to authorize the state or a public institution of higher education to acquire an ownership interest in a private business in exchange for rights to intellectual property developed by the state or public institution of higher education (see the March 12 issue of the Digest).