SSTI Digest

Investment capital to develop and commercialize new technologies may soon be easier to find in Missouri. The Commerce Committee of the Missouri House of Representatives last week endorsed House Bill 753, a proposal to create a $40 million seed capital fund supported by Governor Mel Carnahan. The fund would be capitalized at $10 million each year for four years. Additionally, private investors would get a 100-percent tax credit for all money they contributed to the new seed capital fund. Investments would be limited to Missouri businesses.

To find money for the new seed capital fund, the bill calls for implementing a temporary suspension of the state’s corporate research and development tax credit, which is capped at $10 million a year. For four years, no new credits would be granted under the R&D tax credit.

BILL REINTRODUCED TO DOUBLE CIVILIAN R&D

Senators Bill Frist (R- TN) and Jay Rockefeller (D-WV) introduced legislation to nearly double civilian and pre-competitive research over the next 11 years. S. 296, titled the Federal Research Investment Act , was cosponsored by 18 other Democrats and Republicans. The bill was referred to the Senate Committee on Commerce, Science and Transportation for consideration.

A similar bill passed the Senate by unanimous consent last session; the House did not act on the bill before adjourning.

U.S. House Science Committee Chairman, James Sensenbrenner (R-WI) has introduced H.R. 760, a bill to make the national research and development tax credit permanent. Ranking Minority Member George Brown (D-CA) has agreed to cosponsor the legislation.

Proponents of the bill say making the credit permanent would remove uncertainty and disincentives for companies in pursuing longer-term research projects.

The R&D tax credit is slated to expire June 30, 1999.  The President’s FY 2000 budget request extends the credit for one more year until June 30, 2000. Since it was first enacted in 1981, the tax credit has been extended eight times and modified five times.

The National Science Foundation has issued a call for nominations for the 1999 Presidential Awards for Excellence in Science, Mathematics and Engineering Mentoring (PAESMEM). Each award is accompanied by a $10,000 grant.

Awards will be made to individuals or institutions. The award recognizes individuals who have "demonstrated outstanding and sustained mentoring and effective guidance to a significant number of students at the K-12, undergraduate or graduate education level."

Institutions will be recognized for programming that enables "a substantial number of students underrepresented in science, mathematics and engineering to successfully pursue and complete relevant degree programs." Post-secondary institutions must demonstrate students have been mentored successfully to either the baccalaureate, master’s or doctoral levels.

A review of State of the State speeches, inaugural addresses, and budget messages delivered by 48 governors over the last six weeks indicates a high level of interest in science and technology based economic development. Governors discussed research and development tax incentives, education, and new initiatives to encourage technology-based economic development.

As usual on the state level, support for science and technology transcended political parties. Over the coming weeks, the SSTI Weekly Digest will examine a number of the governors’ proposals in more detail. Selected highlights include:

Alaska: Governor Knowles said that the Alaska Science and Technology Foundation will "continue to pay dividends, if we protect and grow [its] assets." Knowles made the commitment despite budget difficulties brought on by declining oil prices.

The Department of Defense's Dual Use Science and Technology (DUS&T) Program, now in its fourth year of operation, is seeking participation from companies that are developing commercial technologies that could be used in military applications.

DOD has issued a Broad Agency Announcement and is seeking proposals in eight areas of technology:

• Affordable Sensors

• Advanced Propulsion, Power, and Fuel Efficiency

• Information and Communications Systems

• Medical and Bioengineering Technologies

• Weapons Systems Sustainment

• Distributed Mission Training

On Monday, Chicago Mayor Richard Daley announced a series of initiatives to promote technology development for the city, including an information technology incubator, formation of a Mayor’s Council of Technology Advisors, and a Civic Network to support capacity needs for Internet commerce by Chicago businesses.

The cornerstone of the Mayor’s technology initiatives, however, is the formation of the Chicago Technology Growth Fund, a $3 million venture capital fund to provide seed-stage financing in conjunction with private investors for high-tech startup firms located within Chicago. The Illinois Coalition was named to manage the fund for the city.

The President announced his intent to nominate Dr. Joseph Bordogna as Deputy Director of the National Science Foundation (NSF). Dr. Bordogna has served as Acting Deputy Director and Chief Operating Officer of the National Science Foundation since 1996. For the four years prior to this service, he was the Assistant Director for Engineering at the National Science Foundation. He has served at the University of Pennsylvania in a variety of teaching and research positions, as a professor of engineering and director of the Moore School of Electrical Engineering and as dean of the School of Engineering and Applied Science.

The Clinton Administration FY2000 budget proposal, submitted to Congress on Monday, calls for a 2.5% increase in civilian R&D spending. Total R&D spending, however, would decline by 1.3% to $78.24 billion, due to a proposed 5.8% drop in defense-related R&D. For comparison, the Consumer Price Index for last year was approximately 1.6%.

The 21st Century Research Fund remains the centerpiece of the Administration’s R&D investment strategy, representing $38 billion and nearly half of the federal government’s total FY2000 R&D budget request. The Fund, a packaging of several existing and new R&D initiatives, would grow by 3% over the FY1999 total of $36 billion.

Representative George Brown, Jr. (D-CA), Ranking Minority Member of the House Science Committee, introduced legislation on the opening day of the 106th session of Congress to restore protection of federally-funded research data developed within universities and non-profit organizations.  Brown’s bill would repeal a provision quietly inserted without hearings into the final omnibus appropriations bill (Public Law 105-277) by Senators Richard Shelby (R-AL), Trent Lott (R-MS) Ben Campbell (R-CO) and Lauch Fiarcloth (R-NC).

The accompanying table on the SSTI website http://www.ssti.org/Digest/Tables/NSFfy98_SBIR1.htm presents the results of the 1998 SBIR Phase I competition held by the National Science Foundation in rank order by total dollars awards in each state. The award figures were compiled from the NSF Fast Lane website. (There were no Phase I awards reported within the 13 states omitted from the table.

Details on each specific award may be obtained from the NSF FastLane website at https://www.fastlane.nsf.gov