SSTI Digest

The SBIR program has been a legislated requirement of the Department of Defense, an agency responsible for roughly 40 percent of all federal extramural R&D spending, for more than three decades. One might expect that over that amount of time, the Department of Defense would have developed a system to become compliant with SBIR’s fundamental provision that a minimum threshold of innovation research spending be directed toward small businesses.  Yet, a new report from the Government Accountability Office concludes DOD couldn’t say if it was meeting the threshold because, DoD did not submit the required obligations data. The report states “DOD officials told [the GAO] that obtaining obligations data would require requesting information from more than 10 individual program offices that, in turn, would have to request the information from various DOD comptrollers, which would be a major effort.” [Emphasis added.] The report states the DOD has “no procedures to capture total extramural R&D obligations for a particular fiscal year. Moreover, they said they have no plans to establish such procedures, and establishing them would be…

As governors and state legislatures continue their negotiations over state budgets, SSTI has reviewed the latest to be signed. The process has proved difficult in more than a few states, with New Mexico having to overcome several stalemates and still facing shortages while in Oklahoma three-fourths of the state agencies are seeing decreased funding due to the state’s $900 million shortfall. Colorado Gov. John Hickenlooper signed Colorado’s FY 2018 budget. While the state increased spending by 4 percent overall, few of the state’s investments for innovation were adjusted from the previous year. The Colorado Office of Economic Development and International Trade received a substantial cut of $8 million, leaving the office with $51.0 million for FY 2018. Within the office, the advanced industries incentive programs received approval to spend up to $14 million (reduction of $1.5 million) pending the availability of funds, while small business development centers ($94,144), Leading Edge grants ($75,976) and Rural Jump Start ($80,983) all received level funding. Other innovation-related programs also mostly received level funding, with the…

Among the $410 million in items Gov. Rick Scott struck from Florida’s 2018 budget were more than 100 appropriations totaling more than $20 million that would support STEM education, higher ed, R&D and innovation.  Instead, the governor wants the state to spend more money promoting tourism. Scott vetoed more than $20 million for innovation-oriented economic development items, including: University of Central Florida – Incubator - $750,000 National Entrepreneur Center, UCF Research Foundation - $400,000 Tampa Bay Center for Innovation - $1,000,000 The e-Factory in Tampa Bay - $600,000 Smart City Challenge Grant Program - $325,000 Makerspace - $400,000 Embry Riddle Manufacturing Academy and Apprenticeship Internship Program - $2,000,000 StartUp FIU (Florida International University) - $1,000,000 Naples Accelerator Innovation Center and Immokalee Food & Agribusiness - $1,200,000 Beaver Street Enterprise Center - $400,000 Florida Atlantic University Tech Runway - $1,200,000 Eastern Florida State College - Center for Innovative Technology and Education - $2,000,000 Florida State University - Interdisciplinary Research Commercialization Building…

The Blackstone Charitable Foundation has announced its first cohort of eight organizations in the Chicago-area entrepreneurship challenge. Named the BX Challenge, up to $3 million in grant funding will be provided over three years to innovative organizations that effectively recruit and support diverse entrepreneurs and scale startups in the Chicago area. The selected programs will serve underserved populations, including communities of color, women, veterans, and immigrants. The inaugural cohort includes SSTI member UI Labs, which was awarded $100,000 to create a partnership between City Digital and Colony 5 to help community based start-ups tackle urban challenges and explore ideas on smart city developments through entrepreneurship. Other inaugural cohort awardees include: 1871 - $150,000 to create a project that will digitalize content from its workshops and events, making it accessible to a wider audience of entrepreneurs including underserved communities. Bethel New Life - $100,000 to launch a business and technology program in Chicago’s West Side. Bunker Labs - $150,000 to create a remote, high touch version of the Bunker in a Box platform and help fund the…

While much recent attention has been given to the Cancer Moonshot research effort, the National Cancer Institute established a network of publicly funded cancer cooperative research groups more than 50 years ago to evaluate new treatments for efficacy and safety. JAMA Oncology details an investigation that examined the extent to which positive NCI-sponsored cancer treatment trials have benefitted patients with cancer. The study estimated that 3.34 million life-years were gained in the population of U.S. patients with cancer through 2015, at a cost of $125 per life-year gained. Twenty-three treatment trials were identified as providing a statistically significant improvement in overall survival from new, experimental therapies developed from 1956-2016. 

By its very nature, economic dynamism can unsettle local economies. As businesses dissolve, jobs are lost. Technological shifts can drastically alter – or even replace – companies, occupations and entire industries. As these ripple effects move throughout communities, it is easy to focus on the negative impacts, but this loses sight of the importance dynamism has on national economic health. Recent research highlights the significance of dynamism to individual, state, and national economic well-being, as well as a potential paradox: while many Americans are concerned with too much economic dynamism, research shows that the nation needs more of it, not less. Dynamism is a broad term that refers to the scale and rate of an economy’s changes across a variety of measures. Since the 1990s, the United States has seen a pervasive decline in dynamism according to the Index of State Dynamism, a new report from the Economic Innovation Group (EIG). The study found the Great Recession accelerated the extent of the decline, with the average state losing one-third of its dynamism. This interactive index contains seven components to collectively measure…

Two recent U.S. Supreme Court decisions will greatly shape patent holder rights by limiting where patent lawsuits can be filed and restricting patent rights after a product is sold. These rulings are considered by many analysts to be beneficial for startups, small businesses, and consumers. The biggest losers will be patent trolls – patent owners who collect IP rights only to seek infringement damages – who likely will face more pushback against their patent lawsuits and may see fewer settlements. In TC Heartland v. Kraft Foods, the Supreme Court voted unanimously that patent lawsuits should be tried where the defending company is based, rather than in a court of the plaintiff's choosing. This ruling may have struck a significant blow to the practice of patent trolling. For many years, patent trolls have filed the majority of their lawsuits in "plaintiff-friendly" districts. In 2015, over 66 percent of patent lawsuits were filed by patent trolls according to a Unified Patents report.   Patent trolls file in those districts because they have high likelihood of winning if the case goes to trial, creating a strong incentive for…

More than 46 million Americans, nearly 15 percent of the population, lived in poverty in 2015, according to the U.S. Census Bureau’s Small Area Income and Poverty Estimates. Compared against census data for 1999, more than 2,500 of the country’s 3,100-plus counties saw their rate increase. In 2015, 753 counties had a poverty rate of at least 20 percent — and 415 of these counties have been above this threshold in census data dating back to at least 1989. These “persistent poverty” counties are targets for set asides of some federal economic development funding. In the FY 2017 omnibus, Congress encouraged four agencies — USDA Rural Development, CDFI Fund, EPA’s Comprehensive Environmental Response, Compensation and Liability Act (CERCLA), and EDA — to spend at least 10 percent of appropriated funds in “persistent poverty” counties.[1] Congress defines persistent poverty as at least 20 percent of the county population living in poverty over the past 30 years. As can be seen in the map below, many of the 415 counties are concentrated in central Appalachia and the Mississippi Delta region, including New…

While U.S. Secretary of Agriculture Sonny Perdue has announced that the Rural Development agency would be elevated under a reorganization plan because it would be placed under the direct oversight of the Secretary, not everyone is viewing the consolidation as an elevation. The reorganization plan details efforts to “improve the effectiveness of USDA efforts” and includes plans to realign the Farm Service Agency, the Risk Management Agency, and the Natural Resources Conservation Service under a newly created Under Secretary for Farm Production and Conservation. While the report states that the reorganization will elevate Rural Development (RD), in the process it loses its own undersecretary. The USDA Office of Communications, in response to an SSTI request for clarification of the change, responded: “The agencies contained within Rural Development will remain as currently constituted and be led by the Assistant to the Secretary, who will have rural prosperity as a sole focus. Rural Development is gaining power, access, and direct influence. Secretary Perdue is a son of rural America and believes fully that this is an increase in stature for rural issues at USDA…

If it takes a village to raise a child, it may take an entire educational support system as well as public policy reform and funding to get that child into a skilled technical job. A two-year study coordinated by the National Academies of Sciences, Engineering, and Medicine found that the disjointed method of workforce development approaches in the U.S. may be hampering the economic competitiveness of the country. To combat that disjointed approach, the study, Building America’s Skilled Technical Workforce, makes a series of recommendations for policy makers, educators, employers, and other stakeholders in the future development of a skilled technical workforce. Public policy should more fully support students, workers, employers and educational organizations with the right incentives to improve the quality of technical education and training, the report asserts. To help, an alliance of industry, trade, academic, and civic associations and labor unions should organize a nationwide public-private communication campaign to raise awareness of the value of and demand for these workers, as well highlight the return that such a job could bring. Additionally,…

In an effort to incentivize large-scale industry partnerships, Innovation, Science and Economic Development (ISED) Canada will invest up to C$950 million (US$708.5 million) between 2017 and 2022 in superclusters as part of the nation’s Innovation and Skills Plan. ISED Canada defines superclusters as “innovation hotbeds” that build on the advantages of clusters, “dense area of business activity containing a critical mass of large and small companies, post-secondary and other research institutions.” Grants, expected to be in the order of C$125 million to C$250 million (US$93.2 to US$186.5 million), will be distributed to three to five industry-led consortiums in Canada working around industries where the nation has pre-existing strengths (e.g., advanced manufacturing, agri-food, clean technology, digital technology, health/biosciences, clean resources, or infrastructure and transportation). Awarded consortiums will implement market-driven strategies across topics such as increased industry partnerships, collaborative research and development, and the commercialization of new products, among others. To be eligible, consortiums must display…

The Kauffman Foundation’s recently updated Index of Startup Activity finds that startup activity has increased for the third consecutive year and has now reached pre-recession levels. Nationally, the index, which measures business startup activity from 1997 to 2016, increased moderately after two years of sharp growth. Interactive data is available at both the state and metropolitan level. Among the 25 largest states, California, Texas, Florida, Arizona and Colorado, had the highest startup activity in 2017, while Oklahoma, Wyoming, Alaska, Montana and Nevada led among the 25 smaller states. Miami, Austin, Los Angeles, San Diego and Las Vegas were the metropolitan areas with the highest startup activity. Now in its third year, the index is comprised of three equally weighted proxies: Rate of New Entrepreneurs, which measures the percentage of the U.S. adult population that became entrepreneurs, on average, in a given month; Opportunity Share of New Entrepreneurs, calculated as the percentage of new entrepreneurs driven primarily by "opportunity" vs. "necessity" – with necessity entrepreneurs defined as those who were previously…