SSTI Digest

The most recent PricewaterhouseCoopers Moneytree™ survey reported $35.6 billion in venture capital investments were made in 1999 – 150% higher than the record survey results collected in 1998. In fact, at $14.69 billion, fourth quarter 1999 investments alone surpassed the survey results for all of 1998. For the entire year of 1999, the number of companies receiving funds rose 41% to 4,006. In addition, average funding per company increased 71% to $8.9 million. Technology companies and Internet businesses claimed more than 90% of the venture capital investments for 1999 with investments jumping from $10.8 billion in 1998 to $32.4 billion in 1999. Internet investment companies increased their funding by more than six times, with funding climbing from $3.4 billion in 1998 to $19.9 billion in 1999 – this increase accounted for 56% of the total venture capital investments. Among Internet companies, business to consumer e-commerce sites received $4.46 billion, a 1,092% increase in funding levels over 1998. By region, Silicon Valley received $5.7 billion in the fourth quarter of 1999, with a yearly…

Kentucky Governor Paul Patton and House Speaker Jody Richardson have announced a new technology bill to help Kentucky develop an innovation-driven economy. House Bill 572, the Kentucky Innovation Act, is a result of the Science and Technology Strategy designed by the Kentucky Science and Technology Corporation in August, 1999 (see September 3, 1999 SSTI Weekly Digest (http://www.ssti.org/Digest/1999/090399.htm). The bill calls for the Commonwealth to make a $53 million investment in several new economic development, research, and technology transfer programs and initiatives. Along with the state’s $4 million match for the National Science Foundation’s Experimental Program to Stimulate Research (EPSCoR), the bill includes the following funding proposals: $4.25 million for the Council on Post-secondary Education to develop a statewide network of Regional Technology Corporations to provide resources to specific industry clusters, primarily in rural Kentucky. In addition, the Council would oversee the Kentucky Research and Development Voucher Fund, described below. A $20 million Kentucky…

The Department of Energy has announced the selection of 32 grants under National Industrial Competitiveness Through Energy, Environment, and Economics Program (NICE3) and Inventions and Innovations Program (I&I). NICE3 grants support projects for commercial demonstration of innovative industrial technologies that reduce energy consumption, waste production, and operating costs. Eight NICE3 projects will share $3.8 million from DOE; industry will contribute $6.4 million in match. NICE3 awardees are located in California (2 awards), Colorado, Connecticut (2 awards), Delaware, Minnesota, and Pennsylvania. The Inventions and Innovations Program assists inventors and entrepreneurs to bring their energy-saving ideas and technologies to the marketplace. The 24 I&I awardees for 1999 will receive up to $200,000 each for their energy-related inventions. The I&I grants, totaling $3,584,625, were made to companies, universities, and individuals in the following states: Arizona (2 awards), California (2 awards), Georgia, Idaho, Indiana, Iowa, Massachusetts (3 awards), Michigan, New Jersey (2 awards),…

On Wednesday, the U.S. House of Representatives passed the Networking and Information Technology Research and Development Act (NITRD), nearly doubling federal information technology (IT) research over the next five years. Introduced by House Science Committee Chairman F. James Sensenbrenner, Jr., (R-WI), H.R. 2086 focuses federal IT resources towards fundamental basic research and establishes the National Science Foundation (NSF) as the lead agency for federal civilian IT programs. Other agencies included in the bill are: NASA, the National Institutes of Health, the Department of Energy (DOE), the National Institute of Standards and Technology (NIST), the National Oceanic and Atmospheric Administration (NOAA), and the Environmental Protection Agency (EPA). NITRD groups civilian IT programs at the various agencies into one legislative authorization package. H.R. 2086 also provides steady funding increases over multiple years, as opposed to authorization levels that fluctuate each year. NITRD’s authorizes a total of $6.9 billion over fiscal years 2000 through 2004. H.R. 2086 now moves to the…

The Clinton Administration’s final budget request calls for substantial increases in most civilian R&D areas. Overall, civilian R&D would see a six percent increase totaling $2.5 billion and would surpass military R&D spending, which, at $42 billion, essentially would be held level with FY 2000 appropriations. The Administration also proposed funding for several technology-related initiatives in the $1.84 trillion budget; many of these were announced during the last two weeks of January. The centerpiece remains the 21st Century Research Fund, a packaging of new and existing programs used by the Clinton Administration to measure federal investment in basic and applied research. Aggregated, the programs within the fund would receive a seven percent increase of $2.8 billion.

Global Warming – 42 percent increase to $2.4 billion. The initiative includes: research and development efforts into Clean Energy research ($1.4 billion) and Bioenergy and Biobased Products (47 percent increase to $289 million); commercialization incentives for Energy Efficiency ($9 billion over ten years); Clean Energy Export Assistance ($200 million); and, $85 million for local Clean Ar Efforts. National Nanotechnology Initiative – an 83 percent increase to $495 million for research into nanotechnology, the ability to manipulate individual atoms and molecules. Participating agencies include NSF, Defense, Energy, NIH, NASA and NIST. Approximately 70% of the new funding will support to university-research. The Digital Divide – including among other initiatives: $2 billion over ten years in tax incentives to encourage private sector computer technology donations and worker training; $100 million in the Department of Education to create 1,000 Community Technology Centers in low-income urban and rural areas; $150 million for teacher training; $45 million to triple…

The overall FY2001 budget request for the U.S. Department of Agriculture reflects a decrease of more than 9% over FY2000. For several research and economic development programs, the Administration is requesting the opportunity to use funds appropriated in previous years but blocked from use by Congressional appropriations language in 1999 and 2000. Selected agency program highlights include: Distance Learning & Telemedicine Loans and Grants – $427 million (up $206 million) to support access to advanced telecommunications services for improved education and health care in rural areas. Also includes a $2 million pilot program to fund broadband transmission and local dial-up Internet services in rural areas. National Research Initiative – $150 million (down from $163 million, estimated FY 2000 expenditures) for competitive research grants into agricultural genomics, food safety, environment and natural resource management, and competitiveness and profitability of agriculture. Initiative for Future Agriculture & Food Systems – No new appropriation is requested for…

Several Clinton Administration programs in the Department of Commerce are perennial budget battles, and this year is likely to be no exception. Selected program highlights include: Advanced Technology Program (ATP) – $175 million (up $33 million), with $34 million in carryover funds, this funding level allows $65 million to be awarded to new projects through a general competition. Manufacturing Extension Partnership (MEP) – $114 million (up $9 million), including continuation of the existing network of MEP centers and $9 million for a new emphasis area on E-commerce. To accommodate a $15 million, E-commerce initiative, the base funding for the program's existing activities was decreased from $105 million to $99 million. Defense Economic Adjustment – $31.4 million (down $7 million). The decrease reflects a continued decline in need and demand for funding. Economic Adjustment Assistance Program – $70 million (up $35 million). Technology Opportunities Program (formerly the Telecommunications and Information Infrastructure Assistance Program (TIIAP) – $45.1 million (up…

The Clinton Administration budget request for Defense R&D would be essentially equal in FY2001 to FY2000 levels. Research, Development, Testing & Evaluation would dip from $38.3 billion to $37.9 billion. Selected highlights include: Dual Use Science & Technology: Army – $10.15 million (up $0.23 million) Navy – $10.07 million (up $0.12 million) Air Force $10.14 million (up $0.27 million) University Research Initiatives – $253.6 million (up $29.6 million) Government/Industry Cosponsorship of University Research – $6.715 million (no change) Defense EPSCoR – $9.86 million Commercial Operations and Support Savings Initiative (COSSI) – the total FY 2001 appropriation requested for COSSI is $52 million, down $44 million from the FY2000 budget.

With 12.6 percent growth, the Department's budget request includes the largest increase in discretionary spending in the history of the Department. Funding for educational research would increase by $30 million. S&T highlights include: Community Technology Centers – $100 million (up $67.5 million) to create 1,000  computer centers in low-income urban and rural neighborhoods around the country. Next Generation Technology Innovation – $170 million (new), replacing two other programs that received $197 million in FY 2000, NGTI would provide funding to develop new applications of educational technologies and telecommunications for teaching and learning. Regional Technology in Education Consortia – $10 million (no change) to support regional consortia of states, districts and schools to integrate technology with teaching and learning. Technology Leadership Activities – $2 million (no change) to promote leadership in the field of educational technology, including measuring the effectiveness of technology programs.

The President's request for the Department of Energy reflects a 9.2 percent increase over last year's budget. Funding for science and technology activities, however, would increase by $12 percent. Research and development funding for nuclear and fossil fuel energy systems would decrease by five percent and ten percent respectively. Program highlights include: Inventions and Innovations Program – $6 million (up $1 million). NICE3 – $6 million Industries of the Future – $174 million (up $14 million)

There are several environmental R&D initiatives in the Administration's budget request, however, except for the Global Climate Change Technology Initiative, few of these include the Environmental Protection Agency as an active financial participant. EPA's R&D activities are slated to decrease by $6 million in FY 2001 to $530 million (excluding Climate Change expenditures, which is requesting a 120 percent increase).