SSTI Digest

Earnings for Appalachian manufacturing workers grew 3.4 percent from 2012 through 2017 to an average of $63,583. The growth is in the Appalachian Regional Commission’s Industrial Make-up of the Appalachian Region, 2002-2017, which reviews employment and wages by sector across the region. Appalachian workers overall saw earnings increase by 3.7 percent over the five years. In the rest of the country, manufacturing wage growth was 1.2 percent or 3.3 percent across all sectors.

Governors are reaching into their toolkits to build tech-based economies, utilizing Opportunity Zones, tax credits, broadband infrastructure and workforce development initiatives among other things. This week, as we continue to review their state of the state addresses for TBED news, we see some governors still trying to reshape their states’ struggling economies while others are building on past successes and proposing new initiatives.

Arkansas wants to become a technology hub and is proposing a Technology and Innovation Council to help achieve that goal. Delaware is hoping to build on its Angel Investor Tax Credit and utilize Opportunity Zones to spur development. Energy and climate change are on the agendas for many governors, and this week we see it called out by governors in Delaware, Hawaii, New Jersey, New Mexico and New York. Tools for rural development are on the radar in Georgia, while workforce development and education are just part of the plan in New Jersey and New York.

In his Jan. 15 state of the state, Arkansas Gov. Asa Hutchinson highlighted his goal of making the state a technology hub:

The ability of states to deliver the services promised to its residents relies on their fiscal soundness. With most states beginning their fiscal year in July, SSTI has reviewed the current fiscal standing for each state and here presents a snapshot of our findings.

Most states ended their fiscal year with a surplus and continue to recover from the Great Recession, with a growing economy and job gains. However, they face continuing demands on their budgets, with expanded Medicaid payments and the growing opioid crisis confronting nearly every state. Such decisions affect the state’s ability to fund innovation efforts, from the amount of support available for higher education and STEM programs, to funding for entrepreneurship, and forging public private partnerships to strengthen innovation programming that the private sector cannot fully support.

Our analysis found that some states that rely on the energy sector to fund their spending priorities continue to struggle, while others are already factoring in anticipated revenues as a result of new Supreme Court rulings involving gaming and online sales tax collections.

SSTI’s Tech Talkin’ Govs feature returns as governors across the country roll out their state of the state addresses. We review each speech for comments relevant to the innovation economy, and bring you their words directly from their addresses. In this second installment, we present excerpts from governors in Alabama, Colorado, Georgia, Indiana, Kansas, Nebraska, South Dakota and Washington.

Workforce development and/or apprenticeship programs receive attention in all of the below excerpts. The Alabama governor said she is seeking an additional $50 million for higher education, while the Georgia governor talked about reorganizing their technical college system. In Indiana the governor is challenging the state economic development department to create thousands of new jobs and said in the first quarter the state will begin to make strategic investments to build and support more innovation and entrepreneurship through the already established $250 million Next Level Indiana Trust Fund.

SSTI’s analysis of approved FY2018 state budgets continues with a review of action by the Georgia and Utah legislatures. Stability is the word for both states with level funding for the Georgia Research Alliance, Georgia Tech’s Enterprise Innovation Institute, and Utah’s USTAR program. The Georgia legislature did approve the governor’s proposal to increase funding for scholarship programs by $50 million.

Georgia

Georgia’s FY 2018 budget includes a significant increase for the state’s HOPE Scholarship program and stable funding for the Georgia Research Alliance and Georgia Tech’s Enterprise Innovation Institute. The HOPE Scholarship and Zell Miller Scholarship program budgets increase $50 million from $715 million in FY 2017 to $766 million in FY 2018 in keeping with the governor’s recommended budget; the HOPE Scholarship program provides tuition assistance for students that graduated from high school with at least a 3.0 GPA, while Zell Miller recipients must graduate with a minimum 3.7 GPA and a minimum 1200 SAT score on the math and reading portions or a minimum 26 on the ACT.

SSTI has analyzed more recently released state budgets for TBED-related initiatives, and this week we present findings from our review of AZ, GA, IA, IN, UT and VA.   

Arizona

Arizona Gov. Doug Ducey’s proposed $9.8 billion FY 2018 budget would support R&D infrastructure at the state’s three public universities (University of Arizona, Arizona State University, and Northern Arizona University) through the newly-announced University Capital Investment Program. This program would enable universities to use the transaction privilege tax revenues that they generate for as much as $1 billion in bonding for new research and development infrastructure, including deferred maintenance projects.

Education is a major emphasis of the governor’s proposed budget, and while the majority of funds go toward teachers and schools more broadly, Ducey also proposes $5 million in new investments to help connect rural schools to high-speed internet, as well as $200,000 to support a new statewide computer science and coding initiative.

More governors delivered their state of the state addresses and this week we bring you TBED news from governors around the country. Areas of focus include tech infrastructure needs, diversifying economies, cybersecurity and education. While some governors are giving their inaugural addresses, Gov. Nikki Haley used her time to bid farewell. Following are excerpts from the past week’s addresses.

Colorado

Gov. John Hickenlooper gave his annual state of the state address last Thursday, focusing on infrastructure needs – notably roads, but also tech needs:

“We need a comprehensive focus on infrastructure that supports not just transportation, but also broadband, education, healthcare, and our environment.

 “Today, I’m announcing the creation of a broadband office to help us get from 70% to 85% coverage by the time we leave office and 100% by 2020.

The GRA Venture Fund LLC, the private investment fund for companies originating from the Georgia Research Alliance's commercialization programs, has added another $25 million in venture capital. This latest round of funding brings the fund's total investment capital to $45 million. The fund currently has 10 portfolio companies. Combined, these 10 companies have collectively raised more than $241 million and have created over 400 jobs in the state of Georgia. To learn more about the GRA Venture Fund, LLC, visit www.graventurefund.org.

Forty-one states are spending less per student than before the 2008 recession, according to a recent study from the Center on Budget and Policy Priorities. As a result, more of the burden of higher education costs is being passed on to students, putting college out of reach for many. With state budgets still tight, many states are experimenting with new ways to make a college education accessible to all students.

Georgia lawmakers have approved a $40 billion FY16 state budget (HB 76), which is now awaiting the signature of Gov. Nathan Deal. The governor has line-item veto authority over the final document, but most appropriations related to innovation and economic development are consistent with the governor's proposed levels.

Georgia's Department of Economic Development would receive about $30.8 million in state funds under the accepted budget. Within the department, the Global Commerce office and its programs would receive $10.3 million. Innovation and Technology would receive $1.5 million, a large decrease from FY15 due to the transfer of funding for the Georgia Research Alliance (GRA) from Innovation and Technology to the state's Board of Regents.

Three research-focused economic development organizations have released reports over the course of the last month detailing their progress in supporting economic growth, innovation, and beyond. The University of Massachusetts, the Georgia Research Alliance, and the Virginia Center for Innovative Technologies each use a different approach to measure their success and to communicate their impact to external stakeholders. The variety of releases demonstrates the range of approaches that organizations use to provide useful data in a format that attracts attention to their achievements.

In case you missed it, the midterm elections were on Tuesday, resulting in Republicans taking control of Congress, several new governors, and five states endorsing minimum wage increases. Although the 146 state ballot measures up for vote were a quarter-century low, several proposals were relevant to the TBED community, as highlighted in a Digest article last week. Voters ultimately approved many of these proposals, although initiatives related to higher-education in North Dakota and Oregon both failed.