SSTI Digest

More than half of the country’s governors have delivered their state of the state addresses. Last week’s addresses tended to relate to the national election and the incoming administration, with some governors heralding the change and others pledging to try to reach a bipartisan understanding while standing firm on issues they believe in, like climate change in California. Although TBED issues may not have been at the forefront of the addresses, science, technology and especially innovation and higher education continue to receive attention. This week we zero in on comments delivered by governors in California, Hawaii, Illinois, Massachusetts, Minnesota, Montana and Utah.

California

SSTI has reviewed another mix of state budgets as governors across the country continue to release their proposals. Some states, like California and North Dakota, are seeing cuts in the amount of money designated for TBED-related work, while others like Minnesota are in a more favorable fiscal situation and continue to fund such initiatives. Still others, like Rhode Island, are proposing new initiatives.

California

Bond issues supporting higher education goals got mixed results in Tuesday’s election. A bond issue in Rhode Island to be used for the renovation and construction of the University of Rhode Island’s College of Engineering buildings was a winner in this year’s election, receiving 59.3 percent approval. The bond issue that would have created the Montana Biomedical Research Authority was not as lucky, with 56.9 percent of voters there rejecting the measure. Two other economic development measures fared well with Arkansas voters approving (65.22 percent) a referendum removing caps on state-issued bonds to help finance economic development projects and services. Alabama voters also approved (59.22 percent) an amendment giving communities the power to create zones to attract industry to the state.

The U.S. Department of Commerce’s Economic Development Administration (EDA) announced a number of grants last week to aid regional innovation and entrepreneurship efforts through infrastructure improvements, the creation of new spaces, and business improvements in regions across the country. The grants fund projects in AR, AZ, CA, ME, MI, and OH.

San Pedro, CA – A $3 million grant to AltaSea business hub will fund infrastructure improvements at City Dock No. 1 at the Port of Los Angeles, which will aid in the development of new ocean-related technologies. The hub will provide access to the deep-ocean and research space to study ocean-related problems. It is expected to create 220 jobs and attract $120 million in private investment over a six-year period.

Phoenix, AZ – A warehouse in Phoenix will get new life as a makerspace through a $3 million grant to the Maricopa County Community College District and Gateway Community. The space will be used by students and individuals to access the tools and equipment needed to generate ideas and develop products.

Venture development organizations are reaching into new territory for funding partners and finding success in innovative models. Two new funds, the San Diego Tech & Life Science Investor Syndicate and Rev1 Fund I in Columbus, OH, have recently opened with less traditional funding sources, testing the waters of crowdfunding and heavy corporate backing, respectively.  The San Diego fund, launched by CONNECT, allows anyone wanting to invest $1,000 the opportunity to participate alongside more experienced lead investors. Rev1 Fund I gathered significant backing from community corporate powerhouses located in Columbus, such as Nationwide, Cardinal Health, and Worthington Industries. It also has the backing of institutions like Ohio State University and the Columbus Foundation, as well as government backing from Ohio Third Frontier. The funding models present two ends of the spectrum of defining community involvement for venture development organizations.

Students at several California community colleges as well as California State University (CSU) campuses have access to a new incentive to graduate in four years through new state “promise” programs.  Gov. Jerry Brown Jr. signed SB 412 and AB 1741 creating “promise” programs that act in conjunction with a new 2025 Graduation Initiative, aiming to boost the number of students graduating from those institutions in four years to 40 percent. Success in the programs is intended to help address future workforce needs of California and improve achievement gaps.

A month after a federal court ruled that high-speed Internet service can be defined as a utility, four states have announced commitments to expand high quality, reliable broadband services to rural areas and other underrepresented groups. Two Midwest states, Wisconsin and Minnesota, will provide funding to help support projects that improve access to broadband and spur economic prosperity. California and Virginia are exploring strategies to improve their respective state’s broadband networks.

In the last month, major new developments have occurred in TBED capital programs. Launch Tennessee and Pittsburgh-based Innovation Works both announced positive findings about the growth of their startup investment ecosystems with $1 billion being raised by Tennessee startups from 2012 to early 2016 and over $279 million invested in Pittsburgh startups in 2015. Meanwhile in Ohio, both Youngstown-based and Cincy-based startups will see an influx of capital, while a new $150 million fund focused on stem cell companies and regions has been launched.

Tennessee

A bipartisan group of 17 governors signed the Governors’ Accord for a New Energy Future – a joint commitment to support the deployment of renewable, cleaner and more efficient energy technologies and other solutions to make the U.S. economy more productive and resilient as well as spur job creation in member states. The multi-state effort will work to implement clean energy policies and initiatives in four areas: clean energy, clean transportation choices, a modern electrical grid, and plan for a new energy future. Although the accord doesn’t provide specific efforts, senior advisors to participating governors are expected to convene shortly to discuss initial steps to pursue their shared priorities and commitments according to solarindustrymag.com.

The California Community College Board of Governors unanimously approved a comprehensive workforce development plan to coordinate efforts across its 113-college system to help California close its considerable job skills gap, which is defined as the state needing one million workers credentialed for middle-skill jobs. The new plan includes 25 recommendations across seven areas of workforce development: student success; career pathways; workforce data and outcomes; curriculum; CTE faculty; regional coordination; and, funding. The recommendations are to help ensure a state-wide workforce with relevant skills and quality credentials that meet the needs of the state’s employers. The recommendations were developed by a 26-member Task Force comprised of individuals from inside the community college system and representatives of business, labor and equity groups.

In his 1962 State of the Union address, John F. Kennedy said, "The time to repair the roof is when the sun is shining."  Despite its foggy reputation, perhaps no region has had the sun shine on them more economically since that speech than California’s Bay Area. Currently, in spite of its strengths as a hub for talent, research, and innovation, the Bay Area lacks a cohesive and comprehensive regional economic strategy for sustaining economic growth, weathering business cycles and supporting shared prosperity. To combat this, A Roadmap for Economic Resilience: The Bay Area Regional Economic Strategy serves as a roof-repair-guide of sorts, offering viable solutions to support regionalism,  facilitate infrastructure investment, address housing affordability, encourage adaptive workforce development, and improve access to transportation options.

In the first three quarters of 2015, U.S. venture capital firms have invested $47.2 billion, more than the year-end totals for 17 of the past 20 years, according to new data from the National Venture Capital Association (NVCA) and PricewaterhouseCoopers (PwC). About $16.3 billion was invested in 1,070 deals in the third quarter, bringing the 2015 total to $47.2 billion in 2,239 deals. Investment activity is on track to reach its highest annual level since 2000, and the second highest year since the beginning of PwC’s Moneytree report. Both dollars and deal slightly fell in the third quarter, but still managed to rank as the second most active quarter since 2000.