SSTI Digest

This week the Congressional Research Service (CRS) released Regional Innovation: Federal Programs and Issues for Consideration, which provides a summary of federal programs supporting regional innovation systems (RIS), including programs of the CHIPS and Science Act. As described in the report, federal support of RIS is a place-based approach to economic development, with a goal of encouraging development of innovation ecosystems across the country, especially in regions that have benefitted less than others from the rise of the technology-based economy. The report also addresses the scale, scope and duration of the federal investments, asking Congress to consider whether funding periods for the programs are adequate to achieve RIS goals and “how best to sustain regional innovation efforts after federal funding ceases.”

Programs discussed are administered by the National Science Foundation (NSF), the Department of Commerce (DOC), the Department of Energy (DOE), and the Small Business Administration (SBA), including:

The National Institute of Standards and Technology (NIST) published the revised Bayh-Dole Act rule, “Rights to Federally Funded Inventions and Licensing of Government Owned Inventions,” clarifying procedures and removing outdated references. Revisions were made in response to over 80,000 comments received in response to a notice of proposed rulemaking issued in January 2021. An earlier proposed change that would have codified the long-held policy that march-in rights (rights granted to the federal government in specified circumstances allowing it to grant patent licenses to parties other than the patent owner if the research and development is federally funded) cannot be exercised solely on the basis of product pricing is not included in the revisions.

This week the Economic Development Administration (EDA) announced it had completed awarding $27.9 million in cooperative agreements to establish eight economic development Communities of Practice, including the Technology-Based Economic Development (TBED) Community of Practice led by SSTI to help build the capacity and disseminate effective technology-based economic development practices across the innovation industry and the Building Better Regions Community of Practice where SSTI has partnered with RTI. Each EDA award will build a Community of Practice designed to connect participants to capture and disseminate practical knowledge and bring together thematically related groups of economic development practitioners who are working to develop economic ecosystems conducive to the creation of quality jobs for American workers.

As states and local economies tackle an ongoing workforce shortage and a tight labor market, some state legislatures are looking to relax or reform their child labor laws. These proposed changes come as U.S. child labor has been a subject of controversy and debate in recent months amid the reports of federal investigations involving under-aged workers in automobile factories and in meat/food processing plants, or investigative exposés involving cereal factories, twelve-year-old roofers, and underage slaughterhouse workers.

While the Tax Cuts and Jobs Act of 2017 was passed more than five years ago, many businesses seem to be just discovering the effects of one of its sections this tax season. The law stipulated that, for tax years beginning in 2022, companies could no longer choose to expense their entire “research and experimentation” costs in one year and must instead amortize those cost over five years (with a half year look-back). The result is posing a threat for companies with limited, or non-fungible, cash flow. Congress displayed broad support for restoring the original rule but failed to pass the change during the previous session. The question on many people’s minds is, “what happens now?”

Background

The U.S. Department of Treasury and the International Trade Administration within the U.S. Department of Commerce have issued reports considering a program to address national security concerns “arising from outbound investments from the United States into sensitive technologies that could enhance the technological capabilities of countries of concern in ways that threaten U.S. national security.” The reports were required by Congress as part of the most recent appropriations bill and come amid growing concern about China’s technological capacity and if American venture capital funds are helping fuel it.

Reports from the two departments to Congress focus on outbound investments from the U.S. into sensitive technologies that could enhance technological capabilities of “countries of concern” in ways that could threaten the U.S. Those investments that would be under consideration are not currently captured by export controls, sanctions, or other related authorities.

A new report compiled by The White House Office of Science and Technology Policy (OSTP) outlines a whole-of-government approach to biotechnology and making it a national priority. The report lays out bold goals over two decades for biotech R&D, calling for an increase in agricultural productivity by 28% in the next decade and reducing food waste and loss by 50% by 2030.

The SSTI Innovation Advocacy Council continues to work toward additional appropriations for Regional Technology and Innovation Hubs, Build to Scale, and the Federal and State Technology (FAST) Partnership. This week, the Council facilitated meetings with SSTI members and congressional offices to discuss funding priorities. SSTI also released a letter signed by 70 national and regional entities that support fully-funding the Tech Hubs program.

During the meetings, offices across the Hill expressed support for the SSTI Innovation Advocacy Council’s priority programs. However, staff do not yet have sufficient clarity about the FY 2024 budget levels or process to know how this support may translate into actual funding.

The idea of changing the 40 hour workweek standard has been floated for decades, and more frequently discussed in recent years as companies confront pandemic-related stress, burnout and the “Great Resignation.” But, even as some smaller U.S. companies (mostly in tech) have moved toward offering a shorter workweek, the idea has not become mainstream, despite some states’ best efforts.

Expanding U.S. innovation capacity sits at the heart of SSTI’s mission, and it was that driving force that guided our response to the Economic Development Administration’s request for information to inform the planning and design of the regional Technology and Innovation Hub (Tech Hubs) program last week. With $10 billion authorized for the program, and $500 million appropriated, the opportunity for growth in the nation demands a thoughtful and actionable plan. SSTI argues that where the country is now has been decades in the making; therefore, a deliberate, well-considered plan providing ample opportunity for regions to both comment on proposed program guidelines and develop local partnerships is needed. In short, EDA should resist the temptation to get the money out the door as fast as possible.

The press release for the latest report from the Intergovernmental Panel on Climate Change (IPCC) opens in what has become a tradition for environmental reporting: a dire statistic intended to inspire a desire for action. This time, it’s that average global greenhouse gas emissions for the 2010-2019 decade were the highest levels in human history. The strategy has worked on the world’s young people and the small handful of people out of 100 who vote for and contribute to environmental change each year (less than 4% of American charitable giving went to environmental/animal welfare organizations in 2021). Unfortunately, these crowds are both powerless and too small.

The Advanced Research Projects for Health (ARPA-H) released plans to establish hub sites in three locations across the United States and announced their strategy for site selection. With one site to be located in the National Capital Region (NCR), ARPA-H will issue a draft Request for Consortium Agreement (RCA) to solicit recommendations for the second and third hub sites.  The ARPA-H hub sites are planned to support a network of partners, or spokes, that will form the foundation of a nationwide health network to “accelerate better health outcomes for everyone.”