SSTI Digest

Chris Matthews is the president of the new Chattanooga Technology Council, which held its official kickoff event earlier this month.

Katherine O'Dea has been named executive director of the Rhode Island Technology Council.

Dr. Leonard Peters is the new director of the Department of Energy's Pacific Northwest National Laboratory.

Tom Walker has been named executive vice president and chief operating officer of the Oklahoma Technology Commercialization Center.

Congratulations to Steve Zylstra, his staff and the 1,500-plus members of the Pittsburgh Technology Council as they celebrate the organization's 20th anniversary.

Rhode Island, like nearly every state in the country, is facing a projected budget deficit in FY 2004. To deal with a $175 million or 6.6 percent shortfall, 21 agencies are facing budget reductions in Governor Don Carcieri's first budget request to the Rhode Island General Assembly. However, demonstrating his commitment to "make strategic investments to promote job growth," Gov. Carcieri calls for increased support for several tech-based economic development initiatives. Topping the agenda is doubling funding for the Slater Centers of Excellence program to $5 million in FY 2004. Gov. Carcieri also proposed eliminating the state's graduated licensing fees to help Rhode Island start-up tech firms and spending $800,000 to jump-start two biotech initiatives. The Slater Centers of Excellence — each focused on a specific technology niche — mine Rhode Island's research institutions for ideas with commercial potential, provide modest startup funds and critical business development support for inventors and entrepreneurs who want to start technology companies. Since the program's inception in FY 1998…

Three-quarters of the nation's cities surveyed by the National League of Cities (NLC) report they are less able to meet their financial needs this year than they were a year ago. This is a sharp increase over the 55 percent of cities that said they were less able to meet financial needs in last year's survey by NLC, the oldest and largest national organization for American cities. The preliminary survey results are based on initial responses from officials in 145 cities to NLC's State of America's Cities Survey on Fiscal Conditions, conducted in February 2003. Factors contributing to the worsening financial picture in cities include a decrease in aid from state governments. More than one-third of the surveyed cities (36 percent) said the decrease in state funds is the largest source of revenue decline in their cities. At the same time, most cities (81 percent) report they increased spending on public safety in 2003. To deal with tightening budgets, 63 percent of the cities report that they are raising fees for services or creating new fees in 2003, compared to 42 percent in 2001. Fifty-…

Washington State still ranks first nationally in the creation of new companies, according to the third annual Index of Innovation and Technology released by the Washington Technology Center (WTC), a state-funded organization that fosters technology employment growth. The Index also shows the number of patents earned by Washington inventors increased by 11 percent from 2000 to 2001. WTC's Innovation Index considers more than 40 key indicators to characterize the health of the state's innovation economy. Growth, financial capacity, human potential, competitiveness, quality of life, and innovation capacity in Washington all are assessed. Venture investment in Washington companies declined almost 60 percent during the years covered by the Index. However, the Pacific Northwest state remains among the top regions of the country for venture investment, ranking ninth overall. Silicon Valley, however, attracts 15 to 20 times more venture capital than Washington State, the findings show. The steady growth of the state's non-aircraft technology sectors has helped offset the loss of its…

Minnesota manufacturers are cutting payrolls, bidding low and scrambling to compete with the giant threat of cheap labor and enhanced manufacturing facilities offered in China, according to a recent survey of Greater Minnesota manufacturing companies. Funded by Minnesota Technology, Inc. (MTI), the state's lead technology-based economic development organization, the survey finds that most of Minnesota's outstate manufacturing companies are facing increased competition, specifically from Chinese manufacturers. Half of all respondents said that Chinese competition is hurting their business, and others suggested manufacturers have yet to see the benefits of trade with China touted by many free marketers. Of those who said Chinese manufacturing had hurt their business: When asked to estimate the loss in sales attributable to Chinese manufacturing, respondents on average estimated they would lose about 20 percent of their business in 2003, with larger losses expected over the next several years. Sixty percent said that it had resulted in lost business as customers bought from or moved…

Around the country, the current funding climate is forcing some technology groups to explore new relationships with each other, including consolidation. In other cases, it just makes good sense. For example, two of Maine's environmental and energy technology organizations are joining forces with the goal of advancing job growth, R&D and new product commercialization within their overlapping industries. The Environmental Business Council of Maine (EBCM) and the Maine Environment & Energy Center (Maine E2 Center) are combining to create the Environmental & Energy Technology Council of Maine (E2 Tech Council). The new organization will service an industry sector that includes more than 200 companies and nonprofit organizations employing approximately 4,000 workers. A two-year Cluster Enhancement Grant provided by the Maine Technology Institute (MTI) is supporting the new organization's start-up effort, with additional cash and in-kind support donated by the Maine State Chamber of Commerce and by approximately one dozen other companies, organizations and agencies. "…

Encouraging innovation is an important part of the bottom line for many state and local technology-based economic development programs. The advantages or "spillover effects" of growing localized knowledge economies or concentrations of researchers and technology firms has been studied by academia for more than two decades. Much of the attention of that analysis and of subsequent public policy has been on the knowledge or process side of innovation. For instance, tax credits for R&D investments, present in more than 45 states based on SSTI research, reward almost any R&D expenditures by firms when, according to a recent working paper by Carmine Ornaghi at the Universidad Carlos III de Madrid, spillovers from product innovations are greater than those derived from process innovation. Spillovers in Product and Process Innovation: Evidence from Manufacturing Firms, which warrants additional research to confirm or refine its findings, suggests public policies targeted more exclusively toward encouraging product innovations by firms may be more effective and beneficial than a current…

Knowledge in the "knowledge economy" can be an extremely difficult entity to measure with any consistency. Innovation and technological change, both key drivers of economic growth, are elusive to grasp and even harder to measure reliably in geographic terms. Patent activity, however, has long been considered an important measure of innovation in the New Economy. Patents are seen as an insightful proxy to help measure and understand economic growth through technological change and for research on the economics of innovation. States may then ask, how inventive are we? How does our "inventiveness" compare with other states? The United States Patent and Trademark Office produces helpful online reports presenting the number of patents filed within each state distributed across technology sector or organization. To standardize the aggregate data, to permit easier comparisons and to help some trends to appear, SSTI has compiled a table showing patent activity per 10,000 residents for the most recent four years of data, 1998-2001. Idaho maintained the top spot for number of patents per 10,000…