SSTI Digest

Massachusetts’ Gov. Maura Healey recently proposed a multi-year funding strategy (Five-Year Massachusetts Capital Investment Plan (CIP) [FYs 2026-2030] that  would include investment of $890.4 million, including general obligation bonds and private sector contributions, for many of the state’s TBED and innovation initiatives (programs are outlined below). If approved by the state legislature, the package would also provide capital funding resources to implement the Mass Leads Act passed last fall (see this Digest article for more information). It is unclear how federal budget cuts included in the recent reconciliation act will impact the state legislature’s decision, but if passed as introduced by Gov Healey, a significant portion of the new capital plan funding to the state’s the Executive Office of Economic Development (EOED)–$685.10 million–would be distributed in total over the next five years to the following TBED key priority initiatives…: $251 million to support implementation of the Mass Leads Act; $230 million for the Life Sciences Capital program, which supports the Massachusetts Life Sciences Center with research grants to encourage…

In 1978, Massachusetts took a risk and made an $8.5 million investment into one of the earliest technology-based economic development (TBED) initiatives in the world. The commonwealth, among the states hard-hit by the global manufacturing restructuring underway at the time, which led to the deep recession of the early 80s, knew it needed to try something different to restore its economy and its long-term competitiveness. A new independent impact analysis of the cumulative impact from what became known as MassVentures, spanning its 46-year history, should serve as an example of what public seeding and sustained support for TBED can deliver as a highly effective, game-changing economic development strategy.  MassVentures President and CEO Charlie Hipwood said at the report’s release, “MassVentures is one of the most successful and impactful government-initiated programs on a per dollar basis in the United States.” The annualized impact figures and VC-envying returns bear out the proud statement. Based on an IMPLAN study conducted by the UMass Donahue Institute with MassVentures financial support, for every $1 million of taxpayer dollars (inflation adjusted),…

As this week’s recent research article mentions, R&D tax credits work, so it isn’t surprising several states have either proposed, amended, or enacted research and development (R&D) tax credits for both the current fiscal (2025) and new (2026) fiscal year in efforts to encourage innovation and economic growth. Some specifically target life sciences or biotechnology sectors while others focus on attracting new or existing companies and startups or to further develop life sciences and/or biotech sectors and hubs. The following is a brief wrap-up of some states that have recently introduced or implemented notable R&D credits in their innovation space. Connecticut Gov. Ned Lamont announced in his FY 2026-2027 biennial budget address on Feb. 5 that he was proposing to increase the state’s biotechnology R&D tax credit from 65% to 90%. Doing so would allow companies that make less than $70 million a year in sales to cash in their unused tax credits at a higher exchange rate than the current 65% exchange rate. The boost would cost the state about $1.8 million but result in multiple millions in increased economic activity at startups, industry boosters…

With the start of the new year, most governors deliver State of the State addresses or Budget addresses laying out their priorities for the coming year. With revenues for many states relatively consistent with forecasters expectations, lawmakers, with a few exceptions, continue to maintain cautious or constrained views of their funding priorities and proposed initiatives. As a result, many governors in SSTI’s analysis of addresses delivered so far this season, are speaking more about previously implemented programs and their continued successes rather than rolling out many new programs. However, new priorities for growing stronger innovation economies have not been completely overlooked. The following highlights have been selected excerpted from eight of the 20 State of the States or Budget addresses given between Dec. 2024 and Jan. 16, 2025, by governors from Arkansas, Colorado, Connecticut, Iowa, Kansas, Massachusetts, New Jersey, and New York.   Additional addresses and states will be covered in future Digest issues. On Jan. 14, Arkansas Gov. Sarah Huckabee Sanders gave her second State of the State address, proposing a plan to improve access and…

In last November’s general election, Massachusetts voters approved Question 3: the Unionization and Collective Bargaining for Transportation Network Drivers Initiative, allowing the state’s more than 80,000 Uber and Lyft drivers to unionize and collectively bargain for better wages and working conditions. (The measure only covers ride-hailing service drivers not those delivering goods for companies such as DoorDash.) Aiming to address such issues as sub-minimum wages and other driver concerns, it is a groundbreaking result that could spur similar unionization efforts in other states. It is the latest development in ongoing battles over the role of gig workers in the U.S. economy, specifically, whether they should be considered independent contractors or employees entitled to benefits or wages. Question 3 was approved with 54% support of the vote. Once implemented, the new Massachusetts law will grant ride-hailing drivers the right to form unions and negotiate pay, benefits, and work conditions. It will also establish what constitutes unfair work practices and allow drivers to take their cases before the Massachusetts Employment Relations Board. The state will have the…

After a busy election season that saw gubernatorial elections in 36 states, newly elected and re-elected governors delivered their annual State of the State addresses, kicking off new programs and reviewing the conditions of their states. SSTI reviews the speeches every year and covers news of new developments and initiatives the governors have highlighted as they relate to the innovation economy. New programs are laid out here in the governors own words as excerpts from their State of the State or budget addresses. Not all governors delivered a State of the State, and some that did may not have revealed new innovation-related initiatives and so are not included in our coverage. Common initiatives among the governors that touched on innovation included an emphasis on workforce, education and broadband; water issues for Western governors; and, clean energy. Alabama Gov. Kay Ivey delivered her 2023 State of the State on March 7 and called on legislators to “look ahead and crate an economic development strategy for the 2030s.” “… I am calling on you to get behind our playbook for economic success, what I am calling The Game Plan.” “We will…

The U.S. Department of the Treasury announced 11 additional states whose SSBCI plans have been approved: Alaska, Idaho, Iowa, Massachusetts, Minnesota, Missouri, Nebraska, Nevada, New Mexico, Ohio, and Utah. This is in addition to the 20 states that have been approved this year: California, Hawaii, Kansas, Maryland, Michigan, West Virginia, Arizona, Connecticut, Indiana, Maine, New Hampshire, Pennsylvania, South Carolina, South Dakota, Vermont, Colorado, Montana, New York, North Carolina and Oregon. Funds aim to make capital more accessible for underserved communities and increase economic growth and opportunity. Alaska has been approved to receive $59.9 million across four state programs. The largest program of the four is the Alaska Loan Guarantee Program, which will receive $32 million and aims to provide funding to small businesses that have decreased revenue, according to Alaska’s News Source. In addition to the loan guarantee program, $15.9 million will be allocated toward a loan participation program, $10 million will go towards an equity and venture capital program and $2 million will be allocated to a collateral fund program. Idaho has been approved for…

Moving away from four-year degree programs and toward apprenticeships is one of the recommendations to help ease the workforce shortage experience in the life sciences industry. This and other recommendations are part of a recently released report from the Massachusetts Biotechnology Council, also known as MassBio, on workforce trends in the life sciences industry in Massachusetts. The report also offers recommendations for short- and long-term solutions and strategies for building the workforce in the life sciences industry in Massachusetts that might have applicability in other regions. The labor market for the life sciences industry in Massachusetts grew by 131 percent between 2006 and 2021, while the overall statewide labor market only increased by about 6.9 percent, according to the report. The report identified a gap between the skills and experience expected and available to firms. While talent competition continues to be high, firms use methods like higher wages, improved benefits, and hybrid work to attract and retain talent. About seven in 10 surveyed firms said they prefer entry-level applicants with bachelor's degrees; however, only 58.8 percent require a…

Massachusetts Gov. Charlie Baker and Lt. Gov. Karyn Polito are urging Massachusetts legislators to act on their proposed  legislation  that includes $3.5 billion in clean energy and economic development initiatives. The bill includes $2.3 billion in funding from the federal American Rescue Plan Act (ARPA) and over $1.256 billion in capital bond authorizations to support projects to strengthen state infrastructure, create jobs and invest in all 351 cities and towns in the state. The legislation, called An Act Investing in Future Opportunities for Resiliency, Workforce, and Revitalized Downtowns (FORWARD), includes $1.2 billion in ARPA funds for climate resiliency and preservation efforts, with more than half of that designated for the commonwealth’s clean energy industry.

New York City and the state of Illinois have both made moves recently to shift more of their economies to clean energy. Mayor Bill de Blasio and the New York City Economic Development Corporation (NYCEDC) announced a 15-year, $191 million Offshore Wind Vision (OSW) plan to make New York City a leading destination for the offshore wind industry.  Last month, Illinois Gov. J.B. Pritzker signed sweeping legislation offering new incentives for the adoption of clean energy and aim to move it to 100 percent clean energy by 2050. And Massachusetts Gov. Charlie Baker is looking to use American Rescue Plan Act (ARPA) money to establish a clean energy investment fund.

Falling demand for office real estate and public transit, greater need for flexible child care and requirements for reskilling are some of the insights gained into the future of Massachusetts’ workforce. A recent report released by the Massachusetts Governor’s Office which draws extensively on material prepared by McKinsey and Company shines a light on a post-pandemic outlook for a state that has been heralded as one of the most attractive states for citizens to live, enjoying the third-highest per-capita income, a thriving venture capital market and a growing concentration of entrepreneurial start-ups. Yet, as the report notes, “Despite these competitive advantages, the effects of COVID-19 have profoundly challenged the Commonwealth.” The report explores what work could look like in Massachusetts in both the near term (2025) and five years beyond that, including implications for economic sectors, commercial centers, local downtowns, and more. It anchors its findings in four overall themes: Changing ways of working, such as remote and hybrid arrangements, may shift urban core activities with far-reaching implications on transit, urban vitality, housing, local…

More than half of the nation’s governors have given their State-of-the-State addresses, and in this week’s coverage of the addresses, we complete our review of those that addressed their constituencies through January. As the COVID-19 crisis highlighted the need for greater broadband connectivity and affordability, we again see the state leaders focusing more attention on building out those capabilities. Diversifying state economies also plays a role in Alaska, Hawaii and New Mexico, while opportunities for development through renewables features in addresses from Nevada and New York. In addition to those states, this week’s installment takes a look at innovation-related initiatives set forth in addresses from the governors of Delaware, Indiana, Massachusetts, Michigan, Missouri, Montana, and Utah. Alaska Gov. Mike Dunleavy, Jan. 28, talked about increasing the self-reliance of the state, especially in light of the pandemic and the threat of ports that serve the state closing. In addition to strengthening the agriculture sector and growing the mariculture industry, Dunleavy said he planned to “begin conversations with industry stakeholders to determine what…