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Tech Agenda, Billion Dollar Green Bank Top NY Gov's Economic Growth Plan

January 09, 2013

Innovation was a key term used in Gov. Andrew Cuomo's State of the State address and is referenced heavily throughout his economic development agenda for the upcoming year. The governor proposed creating innovation hot spots, an innovation network and innovation venture capital fund. Efforts would be focused on accelerating technology transfer and providing funds to attract startup companies. Cleantech investments and support for competitive university-based projects that emphasize economic impact also are a priority for the governor.

Titled “NY Rising,” Gov. Cuomo's 326-page accompanying agenda to the annual speech outlines proposals that cover a wide range of issues, from raising the minimum wage and decriminalizing marijuana possession to equality issues for women and gun policy. However, a key component to the plan is building on the work of the regional economic development councils established in 2011 and strengthening partnerships with higher education to continue growing the state's tech-based sector.

The governor's agenda notes several troubling tech transfer facts about New York, including: New York attracts only 4 percent of the nation's venture capital investment, colleges incubate fewer new companies, and the state is home to relatively few fast-growing technology companies. To overcome these barriers, a multi-pronged approach is recommended:

  • Innovation Hot Spots—Selected through a competitive process, ten higher education/private-sector incubators would be designated hot spots offering entrepreneurs support to grow their businesses by residing in a tax-free zone.
  • Innovation NY Network—Based in part on San Diego's CONNECT model, the governor proposes to create a collaboration among academics, venture capitalists, business leaders, patent lawyers and other professionals to examine regulations around intellectual property and barriers to commercialization.
  • Innovation Venture Capital Fund—To help entrepreneurs make the transition from research and prototyping to the creation of marketable products, the state would create a $50 million venture capital fund.

Several steps aimed at building a cleantech economy program were announced, including $1 billion to establish a green bank that would leverage public dollars with a private sector match. Green banks, or clean energy finance banks as described by a recent Brookings report, can take different forms, such as bonding, loans or credit enhancements based on a state's circumstances. They make available low-cost financing for clean energy projects and reduce dependence on federal grants, tax credits and subsidies. To oversee the state's energy portfolio and coordinate a cleantech agenda, the governor recently appointed Richard Kauffman to join his cabinet as the chairman for the newly formed Energy Policy and Finance Sub-Cabinet.

Gov. Cuomo also called for a third round of funding to support NYSUNY 2020, an initiative that allows four research universities to compete for challenge grants that enhance economic development (See the Aug. 17, 2011 issue of the Digest). A new proposal asks lawmakers to fund a similar grant program for CUNY—the City University of New York.

NY Rising is available at: http://www.governor.ny.gov/sites/default/themes/governor/sos2013/2013SOSBook.pdf.

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