SSTI Digest

In last week's Tech Talkin' Govs II article, we inadvertently listed Mark Warner as the Governor of South Carolina. Gov. Warner leads the Commonwealth of Virginia. Mark Sanford is Governor of South Carolina. SSTI regrets the error.

Following 41 straight months of job losses in the manufacturing sector, the Bush Administration released its long-awaited strategy to help revive manufacturing. Manufacturing in America: A Comprehensive Strategy to Address the Challenges to U.S. Manufacturers makes 31 recommendations designed to address challenges identified through 23 roundtable discussions that were held across the country.

Included in the recommendations is support for "a newly coordinated Manufacturing Extension Partnership (MEP)." While much of the press attention across the country has indicated that this is a major reversal on the Administration's part, the picture is not as simple as that. The Administration's fiscal year 2004 budget request of $12.6 million for MEP would have cut funding to all but two of the MEP centers. The budget approved by Congress on Thursday contains $39.6 million for MEP, down from the FY 2003 level of $106 million.

The satisfying flavor of success in tech-based economic development is whetting Oklahoma's appetite for more. Lots more.

The past two weeks in the Sooner State have seen the release of the third annual impact report from the Oklahoma Center for the Advancement of Science and Technology (OCAST), Gov. Brad Henry's appointment of a science and technology advisor, and the culminating $1 billion action plan of the governor's Economic Development Generating Excellence (EDGE) task force.

A new report from the Massachusetts Technology Collaborative (MTC) finds the federal government’s expanding investment in Homeland Security-related research is already proving a major boon to the high tech economy in Massachusetts, but the state’s overall leadership in federally-funded research and development (R&D) is under intensifying pressure from states throughout the country.

The MTC report tracks $3.3 billion in new federal funding for Homeland Security R&D to key industry clusters in Massachusetts and finds the most significant opportunities lie in the life sciences. Recent major grants (e.g. BU National Biocontainment Laboratory and the Harvard Medical School Regional Center of Excellence for Biodefense and Emerging Infectious Diseases Research) will strengthen the region’s existing assets in fields related to bio-terrorism defense and the detection, prevention and cure of infectious disease.

Three I's neatly sum up the 22 recommendations recently released by Maryland Governor Robert Erlich's Commission on Development of Advanced Technology Business — Investment, Innovation, and Image. The year-long study looked at the state's existing physical, financial and intellectual infrastructures to support the state's research and technology sectors, making specific recommendations in three groupings to foster continued growth.

The Maryland Technology Development Corporation (TEDCO) figures prominently in many of the recommendations, and, in partnership with the Department of Business and Economic Development, the research universities and the state's regional technology councils could play an even more significant role in the state's technology strategy if the plan is fully implemented.

The line was drawn in the sand a year ago. Some felt Virginia's Center for Innovative Technology (CIT), the Commonwealth's lead organization for science and technology, had been set up for failure in a partisan fight for limited public revenues. Like the rest of Virginia's economic development portfolio, CIT took a big hit in the budget cycle as Virginia dealt with a multibillion-dollar deficit in fiscal year 2003. CIT's budget was slashed to $7.8 million, yet its targeted total impact for the year was $266.8 million. Could it be done?

In a word, yes.

Dismissing all doubters, CIT released a report last week of its audited FY 2003 performance that shows economic impact totaling $318.6 million, a return of more than 40 times the Commonwealth's $7.8 million investment.

Tech-based economic development remains high on the agendas of the most of the governors who gave State of the State or Budget Addresses this week. Selected excerpts are provided below:

Delaware Gov. Ruth Ann Miner, State of the State Address, Jan. 22, 2004 "The era of opportunity we are entering presents us with the chance to diversify and fortify the Delaware economy. In February, I will unveil the details of an economic development package.

On Jan. 18, the San Diego Union-Tribune ran a series of three interesting articles examining the biotech sector. One story considers, now that a number of local biotech firms are completing clinical trials, where will they develop their multimillion manufacturing facilities. The other two articles look at selected state and local efforts around the country to support the biotech industry, including Washington, D.C., St. Louis, and Marshfield, WI.

If the first full week of the 2004 state legislative season is any indicator of the year's tone and tempo for tech-based economic development initiatives (TBED), then we're in for quite a ride.

Of the 18 governors presenting their State of the State or Budget Addresses between Jan. 6-14, all but four – Alaska, California, Vermont and Virginia – used the speech to highlight the importance of making future investments in science and technology to encourage economic growth. The supportive tone covered the political spectrum, with both conservative and progressive leaders touching on issues important to the TBED community. SSTI has highlighted excerpts from selected states in our first 2004 installment in the annual series, Tech Talkin' Govs.

Last Thursday, Gov. Jennifer Granholm signed bills to aid Michigan’s tool and die industry and to promote new venture capital investment in the state’s high-tech industries.

One of Granholm’s key themes in last year’s State of the State address was the importance of leveraging Michigan’s financial power to bring investment capital to the state. The venture capital bills signed today – Senate Bill 834, Senate Bill 835 and House Bill 5322 – create the Michigan Early Stage Venture Capital Investment Fund and provide tax credits for investors in the fund. Money in the fund could be invested in venture capital companies to promote investment in qualified businesses.

North Dakota Governor John Hoeven dedicated the lion's share of his State of the State Address to promoting a vision of economic growth for the state based entirely on technology-based economic development. The proposals centered on more than a dozen new university-based Centers of Excellence and new tax credits.

"I challenge all of us today to share a vision; a vision of what North Dakota can be. And I challenge all of us to work together to make that vision a reality. The future I speak of has Centers of Excellence multiplying across all of our state's college campuses, creating new enterprises, opportunity, and good paying jobs. It is a vision where a technology corridor drives growth in the east, where an energy corridor drives growth in the west and where value-added agriculture, advanced manufacturing and tourism enterprises flourish throughout our state."

New York Governor George Pataki, in his 10th State of the State Address last week, outlined a variety of initiatives designed to further promote tech-based economic development (TBED) in the state. From refining the state's Empire Zones program and strengthening the manufacturing sector to making New York a leader in renewable energy and academic research, the governor's agenda is not short on TBED items.

To strengthen the state's Empire Zones, a target of much criticism lately, Gov. Pataki proposes revising it in such a way that reduces the potential for abuse. A comprehensive interagency reporting system, new methods to advance significant economic development projects with "substantial job-creating potential" and accountability measures would be undertaken. Economically challenged communities targeted for redevelopment also would benefit under the governor's plan, which would extend the tax credit program by five years to July 31, 2009.