SSTI Digest

Philip Psilos is the new Director of Economic & Technology Policy for the National Governors' Association.

Timothy A. Klein has been selected to become the Associate Administrator for Innovation, Research, and Education for the U.S. Department of Transportation. 

SSTI extends its congratulations to Bruce Gjovig, Director of the Center for Innovation in Grand Forks, North Dakota, for his induction into the North Dakota Entrepreneur Hall of Fame. 

With the slowdown in the economy, there is widespread concern about the kind of painful belt-tightening which occurred in the states in the early 1990s. Because of this perception and the rapid change in so many states’ fiscal situations, the National Conference of State Legislatures (NCSL) released this week a new survey to update its January 4, 2001, State Fiscal Outlook for 2001. NCSL found that 33 states -- down from 44 reported only seven weeks earlier -- still report that revenues are on target or above forecasted levels for the current fiscal year. The likely reason for the 11-state decrease is lower than anticipated November and December revenues. Medicaid and increased funding for education are the two main expenditures pressuring states’ budgets.  States most affected by the slowdown are located in the South and in the Great Lakes region: Alabama, Arkansas, Indiana, Kentucky, Michigan, Mississippi, North Carolina, Ohio, South Carolina, Tennessee, and Virginia.  Most states report they will not need to cut their FY 2001 budgets to…

On February 26, President Bush issued a memorandum to 21 departments, agencies and other executive offices to create an Interagency Working Group on Federalism. The group is to:  a) Identify initiatives that promote principles of federalism, such as:  federal endeavors which may more appropriately be carried out by state or local authorities;  Opportunities for flexible funding streams, regulatory waivers, and other opportunities that increase State and local flexibility, innovation, and accountability;  Measures for improving federal responsiveness to state and local concerns; and  Enforcement of rules, orders, and procedures that advance federalism.  (b) Draft a new Executive Order on Federalism, which will require departments and agencies in the executive branch to adhere to principles of federalism;  (c) Consult, as appropriate, with state and local officials on issues pertaining to federalism, including, but not limited to, the issuance of the new Executive Order on Federalism. …

Release of the first solicitation of proposals for the new $3.5 million Federal and State Technology Partnership (FAST) has been delayed until the end of March, according to attendees of the National Small Business Innovation Research (SBIR) Conference held in Tulsa this past week. SSTI's March 1 presentation regarding FAST (a 16-slide Powerpoint file) is available by email request to skinner@ssti.org   Independently, SSTI sources indicate that the President's FY 2002 budget request is reported to include $3.5 million for the FAST Partnership and $1.5 million for the Rural Outreach Program. The continuation level of funding for both programs marks a shift in the SBA's practices during the Clinton Administration of zeroing out programs created by Congressional initiative. The additional year of funding, if approved by Congress, also allows states better ground for designing new programs to assist small businesses in commercializing technology, planning to meet FAST matching requirements, and making hiring commitments. 

The headlines of many tech and business publications scream of massive Internet incubator layoffs, closures, and restructuring. The rapid rise and fall of these organizations has left some local tech-based economic development practitioners wondering if encouraging the growth of incubator facilities is a worthwhile strategy to pursue. Closer scrutiny of the incubator phenomenon of the last few years, however, reveals many communities and states are increasing their investments in facilities to encourage technology start-ups at the same time for-profit incubators are closing.  Whether it is called a technology incubator, business accelerator, or innovation center, the real difference seems to lie in the orientation or goals of the entity: is it intended to make money for its private investors or is it organized as a not-for-profit to encourage local technology business growth? The dire headlines and talk of incubator crashes all refer to for-profit accelerators formed in the past two years to cash in on the dot-com craze. When the craze crashed, so did many of these get-…

The National Science Foundation has published online the latest edition of the annual series: Science & Engineering State Profiles: 1998-99. By presenting one-page statistical summaries for each state, the District of Columbia, and Puerto Rico, Profiles provides rankings, state and US figures for easy reference across 30 science and engineering statistics as well as the distribution of federal R&D obligations by department and performer.  Additionally, the report includes population, per capita income, and workforce figures, permitting easy calculation of per capita statistics and rankings across the states. For example, SSTI has prepared the accompanying 50-state table presenting for comparison the number of patents issued to state residents in 1999, the average number of patents issued per member of the state’s civilian workforce, the average number of patents per doctoral scientists and doctoral engineers in the state, and the R&D dollars spent in the state per patent issued.  Profiles can be downloaded at: http://www.nsf.gov/…

With the 1994 School-to-Work Opportunities Act sunsetting this year and the increasing importance of developing a skilled workforce for a tech-based economy, many are asking if the initiatives launched or expanded by the Act have been successful. According to School-to-Work: Making A Difference in Education, a new report from the Institute on Education and the Economy at Columbia University, early results are encouraging, but there are areas for improvement given the opportunity presented by reauthorization.  To prepare their findings the Institute reviewed the findings and conclusions of more than 130 local, state, regional, and national studies completed on School-to-Work programs. A complete bibliography is included at the end of the document.  Accomplishments  According to the report, employer engagement in school-to-work is at record levels. By 1997, “three years after passage of the Act and before all states had received funding, more than one-quarter of all firms employing 20 or more people were members of…

Two new Governors, Bob Wise of West Virginia and Wisconsin's Scott McCallum, have put tech-based economic development in the forefront of their respective economic agendas. West Virginia In his first State of the State Address, delivered February 14, and the Economic Development Plan released during his campaign for office, Governor Bob Wise outlined several tech-based economic development and education initiatives for the state to pursue immediately. He followed up the address by giving the state assembly several specific legislative proposals. Governor Wise's proposals include: retain the state's brightest high school graduates, fund the state's Promise Scholarship program to provide funancial support for every qualified student to attend the state's colleges, universities and technical training centers create a State Science Camp for high school graduates, modeled on  the month-long National Youth Science Camp <http://www.sciencecamp.org/> reform the West Virginia Capital Company Act to restrict use…

The latest word in the national press regarding the FY 2002 budget President Bush will present to Congress next week suggests President Bush may propose significant cuts in investment in research and tech-based economic development. Many of the programs potentially under fire are instrumental to state and local efforts to promote stronger economic growth through science and technology. A Feb. 15 story in the Wall Street Journal, "White House Is Planning Broad Cuts in U.S. Firm's Government Subsidies" reports the Office of Management and Budget has called business loan and grant programs for technology and economic development "corporate subsidies" that are "unjustified" and "low priority." The article singles out the International Trade Administration, the Overseas Private Investment Corporation, and parts of the Agriculture Department. After last year's historic 17 percent increase for the National Science Foundation, an article by David Rogers in last Friday's Wall Street Journal, "Bush, Seeking Room for Tax Cuts, Chops Budgets for Science Agencies,"…

Stressing partnerships and flexibility, seven regional and national organizations have drafted an action agenda for the federal government to use to strengthen local and regional economic development efforts. After a brief introduction to the New Economy and its implications for local economic development, Partnership for Prosperity: A Federal Economic Development Policy Agenda includes several specific recommendations of interest to Digest readers: Stimulate markets in underserved areas by improving the Empowerment Zone/Enterprise Communities program and the American Private Investment Companies, and by reauthorizing the Community Development Financial Institutions. Partnering with the private sector to close the Digital Divide through new tax incentives, preserving the 1996 Telecommunications Act, and increasing funding for the Technology Opportunities Program, the Economic Development Administration and the Rural Utilities Service in the Department of Agriculture. Removing regulatory barriers in small business by improving the 504 loan program administered by the Small…