SSTI Digest

A recent report by Cleveland State University's Levin College of Urban Affairs details the economic impact of companies supported by JumpStart Inc. and the North Coast Angel Fund in the 2012 calendar year. The 127 companies included in the study created 2,140 jobs in Ohio (1,652 in Northeast Ohio), generated $269.7 million in economic benefits for the state, and produced $35.5 million in federal, state, and local taxes. Those studied included 63 "portfolio companies" that received technical and funding assistance and 64 "client companies" that received only technical assistance. Read the report...

The city of Los Angeles is working with a consortium of public and private partners to redevelop unused docklands into space that will support new industry cluster development. The project highlights a trend of high-profile projects across the country, with cities like Brooklyn and Philadelphia repurposing dockside warehouse space to seed tech startups and advanced manufacturing. A 100-year old dock in Los Angeles is being developed as an urban marine research and business park. The development is a public-private collaboration between the Port of Los Angeles, the Annenberg Foundation, and a host of regional universities. The development will be used to focus on an untapped niche in ocean science, turning the LA waterfront into a global center for the study of the effects of climate change on coastal cities, according to the publication Nature. U.S. ports currently are experiencing a boom in production and profits as global trade continues to expand. However, like many other industries in the U.S., the growth of ports is contributing to a "jobless recovery" as harbor operators increase production and profits with automated processes that increase…

The co-locating of researchers, donated equipment, and capital are recent examples of key elements provided by private-sector partners to help accelerate technology commercialization. In the past month, leaders from universities and nonprofit organizations across the country have announced new efforts to expand research capacity and bring more products to market by launching innovative centers in collaboration with corporate partners. University-industry alliances often are credited with helping build regional innovation ecosystems with successes cited in new company formation, high-tech job creation and a better trained workforce, among others. Often times, companies look to leverage their R&D activities with complementary initiatives taking place at local universities. So is the case in Burlington, MA, where a new innovation center aimed at accelerating the commercialization of basic research is the product of a partnership between Northeastern University and Rogers Corporation. The George J. Kostas Research Institute for Homeland Security is a planned 4,000-square-foot center to be completed by the end of the year on the university campus. While targeted…

Department of Energy (DOE) Secretary Ernest Moniz is leading a restructuring of the department's management, reorganizing programs and undersecretary positions to better align with the operational goals of supporting President Obama's Climate Action Plan, an "all of the above" energy strategy, and strengthening nuclear security. The move will create an Under Secretary for Management and Performance, merge the energy and science programs, and consolidate the department's defense waste cleanup efforts. In a memo addressed to employees and released to The Hill, Moniz cited the need "to improve the effectiveness and efficiency of departmental operations." The reorganization reflects changes suggested by Turning the Page: Reimagining the National Labs in the 21st Century Innovation Economy, a joint report released by ITIF, the Center for American Progress, and the Heritage Foundation. The report recommends merging the existing Offices of Science, Energy Efficiency and Renewable Energy, Fossil Energy, and Nuclear into a new Office of Science and Technology to better coordinate research activities. This office will be managed by a single…

During this year’s legislative sessions, several states looked toward creating, providing support for or redesigning programs that help incentivize businesses to hire and mentor student interns. In an effort to spur rural internships, Minnesota lawmakers approved a new tax credit program to support internships for students in greater Minnesota. In North Dakota, lawmakers committed $1.5 million to their Operation Intern program, while Nebraska lawmakers updated their Intern Nebraska grant program to provide students with a high-quality internship experience. Rhode Island Gov. Lincoln Chafee signed a bill that will allow high school students (16 years and older) to engage in pre-apprenticeship, apprenticeship and internship experiences during school hours in approved manufacturing career and technical programs. In an effort to spur rural internships, Minnesota lawmakers approved a new tax credit program to support internships for students in greater Minnesota. As part of the state’s Omnibus Tax Bill (HF 677), the program would reward companies for hiring college interns by paying up to 40 percent of the intern’s salary, up to $2,000 per person. The…

A number of states recently have taken action to expand R&D tax credits and other legislation that would support innovation, commercialization and manufacturing. Hawaii, California, Maryland, Texas, and Florida have signed into law tax incentives and R&D tax credits and an R&D tax credit in New Hampshire went into effect.  The Maine legislature also passed a capital tax credit that will begin in 2014. In late June, the Maine Senate and House passed LD 743, which will extend the Maine Seed Capital Tax Credit. The original tax credit program was created in 1989 with a $30 million cap. This extension will provide an annual cap of $5 million in tax credits to qualifying investors, beginning in 2014. “A tax credit certificate may be issued to an investor other than a private venture fund in an amount not more than 50 percent of the amount of cash actually invested in an eligible Maine business in any calendar year,” according to the bill. The business invested in must be “a manufacturer or a producer of a value-added natural resource product.” The New Hampshire tax credit in SB 1 took effect in late May.  SB 1 increases the…

States across the U.S. are directing their attention to science, technology, education and technology (STEM) education, and already have passed a plethora of new initiatives in the current legislative session.  These programs are directed at various levels of education including primary education and higher education, with one program specifically designated for the state’s community colleges. A number of states have created STEM advisory councils under the governors’ offices, following the lead of Iowa and Massachusetts. Such measures suggest that STEM is no fleeting policy issue and that states are beginning to recognize the economic value of making long-term investments in students. Both Connecticut and Massachusetts included funding for STEM initiatives within their most recent budgets. The Massachusetts budget included a line item of $4.75 million for a new STEM Starter Academy that will work with one or more community colleges in the state to train students interested in STEM career fields. Connecticut allocated $1.5 billion to University of Connecticut campuses over the next 10 years to expand STEM facilities and enrollment. See SSTI’s…

At the close of many recent legislative sessions, states across the country moved to strengthen their high-tech workforce while supporting industry cluster development. In Washington state, the Working Washington Agenda has received bipartisan support to strengthen the state’s economic foundations on a wide range of fronts. The final bill provides funding for STEM education, improves workforce training programs, and assists with the growth of key industries. One highlight of legislation supporting cluster development is the creation of a Joint Center for Aerospace Technology Innovation, backed by $1.5 million in state funding, which is being used to fund 18 research projects across the state. Each grant connects an in-state aerospace company with public university partners to support the commercialization of new technologies. Currently, the University of Washington, Washington State, and Western Washington are participating. The program is designed to assist aerospace companies of all sizes, and includes $300,000 in grants for 12 high schools to adopt aerospace assembly programs. The Working Washington Agenda also directs $40 million toward the creation of…

A continued trend toward improved fiscal conditions gave rise to targeted and riskier investments in research for several states this legislative session. In particular, lawmakers dedicated funds for life sciences research and for initiatives aimed at commercialization through partnerships with higher education and the private sector. Other states dedicated additional funds to expand promising research and technology-focused initiatives already underway. Lawmakers Support Efforts to Promote Research CommercializationNew funding commitments in life sciences occurred in Connecticut and Indiana. Connecticut lawmakers approved Gov. Dan Malloy’s proposal to create a $200 million fund to spur bioscience R&D as part of a broader economic development agenda announced in his State of the State address. With the passage of SB 842, Connecticut Innovations (CI), a quasi-public venture development organization, over 10 years will provide capital to early stage companies with the goal of driving efforts toward commercialization of new businesses and products. CI also plans to focus funds toward translational research and riskier investments for helping university…

As many state legislative sessions wind down, a clearer picture of the current direction of state innovation policies is emerging. This week’s SSTI Weekly Digest presents a few of the major trends in technology-based economic development initiatives approved by state legislatures during their most recent sessions. While this review is not meant to be comprehensive, it should illuminate the shifts states are making to refine their investments in the high-tech economy by providing smarter, more targeted support. Over the past few months, the Digest has reported on several major capital access initiatives, transparency efforts and agency reorganizations that have made headlines amid a slow economic recovery and renewed attention to accountability in economic development. While other stories in this issue will examine some of the trends in legislation that previously have gone unreported in the Digest, several major legislative efforts have appeared in earlier issues, but represent other intriguing developments in state innovation policy. States Launch Venture Capital Funds for High-Tech GrowthThis week in Wisconsin, Gov. Scott Walker signed…

Between FY03-11, the U.S. Department of Treasury's Community Development Finance Institutions (CDFI) Fund supported $26.4 billion in private investment through the New Market Tax Credits (NMTC) program, according to data released by the fund. The CDFI Fund helps economically distressed communities leverage private investment capital by offering investors a federal tax credit. During its first nine years, participating Community Development Entities (CDE) leveraged their NMTC allocations to invest in 3,499 projects related to real estate, business development, microenterprise finance and other purposes in mostly low-income communities. In order to participate in the NMTC program, a qualified investor must be certified as a CDE by the CDFI Fund. The fund then awards an allocation of tax credit authority for that CDE, which can be used to support Qualified Equity investments (QEI) in distressed communities. The CDE must then report information about its investments to the fund within six months after the end of the fiscal year. As of this year, the CDFI Fund has awarded allocations to 749 CDEs, totaling $36.5 billion in tax credit authority. The current release…

A central tenet in the understanding of regional economic clusters is the idea that the closer two actors are to one another, the more likely they are to collaborate. This belief is based on decades of research done to examine knowledge spillovers and the effect of spatial proximity on tacit knowledge sharing. In a recent article, however, Jasjit Singh of INSEAD and Matt Marx of MIT differentiate the varying effects of crude distance on knowledge sharing compared to the effects of geopolitical borders. Despite the explosion of the Internet and advancement in communication, borders still matter. Singh and Marx examined 30 years of patent citations to analyze the effects of geopolitical boundaries on knowledge sharing. Although patent citations do not capture the true impact of knowledge sharing, they can provide a meaningful understanding of the path and scope in which knowledge flows, and the potential benefits it may produce. The authors compiled over four million patent citations of more than 630,000 patents between the years 1975-2005 from the U.S. Patent and Trademark Office (USPTO) into their data set. Patents where inventor teams were geographically dispersed were…