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The Bush Administration's first budget request offers a mixed bag for state, local, and non-profit practitioners and policymakers in tech-based economic development. In research categories, the budget reflects the Administration's research emphasis in defense, biotechnology, and life sciences. The budget also reorganizes the nation's energy research priorities. Most other research categories were held at FY 2001 funding levels or received modest increases or cuts.

Research funding levels, with the exception of $150 million in Congressional earmarks, remain relatively flat between FY 2001 appropriations and the President's FY 2002 request. Economic development and Digital Divide programs, on the other hand, take several hits. Selected agency program highlights include:

The total agency budget request is $4.8 billion, $300 million less than the FY 2001 appropriation level. The majority of the reduction is absorbed by elimination of new project funding for the Advanced Technology Program, a 67 percent cut or $30 million for the Technology Opportunities Program, and a $77 million cut in Economic Development Administration programs. Selected Commerce program highlights include:

The Administration budget request calls for a $2.6 billion increase for missile defense alternatives and new technology development. The President plans to increase military research by $20 billion over the next five years. Research, Development, Testing & Evaluation (6.1, 6.2, and 6.3 spending categories) would grow by only two percent in FY 2002, however. The American Institute of Physics reports the final Defense budget request will be released on May 15.

The agency's total FY 2002 budget request of $19.2 billion reflects a drop of 2.3 percent. The DOE science budget would increase to $3.16 billion, representing an increase of one-tenth of one percent. Shifts within the R&D budget reflect the President's priorities in fossil fuel research: $150 million in new matching federal funds will support the Clean Coal Power Initiative. Funding for Biological and Environmental Research, on the other hand, falls by more than eight percent.

The Administration's FY 2002 budget request of $7.3 billion is $56 million, or 0.08 percent, higher than the FY 2001 appropriation. Funding for EPA science programs would be cut by $27 million or nine percent. Highlights of specific programs within the science budget include:

The Administration’s budget request includes a 13.8 percent increase of $2.8 billion in biomedical research within the National Institutes of Health. Not to be outdone, the Senate has already passed a budget resolution calling for an additional $700 million in NIH funding for FY 2002.

Total funding for the Community Development Block Grant (CDBG) program is reduced by $9.7 million or 0.3 percent over FY 2001 levels. A new $80 million Community Technology Centers initiative within the CDBG program budget will provide competitive grants to support the development and expansion of technology centers in high poverty urban areas. The budget request says the new centers will enhance the Dept.

The Administration's $14.5 billion request for NASA reflects an increase of just under two percent over the FY 2001 appropriations. While funding for the Science, Aeronautics and Technology unit of the budget would grow from $7.067 billion in FY 2001 to $7.192 billion in FY 2002, the distribution of funding across areas within the unit shifts:

NSF would receive $4.47 billion dollars in FY2002, up $56.1 million (or 1.3 percent) from FY2001 under the President’s budget request. S&T highlights are:

The Administration's budget request eliminates the New Markets Venture Capital Program, the New Markets and the Venture Capital Technical Assistance Grants. The programs are designed to increase access to equity capital and technical assistance to women, minorities and to businesses located in low- and moderate-income rural areas and inner cities.

The FY 2002 budget for Transportation proposes $59.5 billion, the highest funding level in the Department’s history. A summary of research and technology related programs follows:

Venture capital (VC) kept up a steady pace in the first three months of 2004, according to the latest PricewaterhouseCoopers/Thomson Venture Economics/National Venture Capital Association MoneyTree™ Survey. Investments in the first quarter of 2004 totaled $4.6 billion going into 618 companies, the data show. The figure is below the $5.2 billion invested in the fourth quarter of 2003, but above the first quarter total of a year ago, $4.2 billion.

Amid criticism from taxpayers, legislators in Hawaii agreed to renew the widely debated bill that extends high-technology tax credit for another five years, without a provision requiring the disclosure of companies that receive the credits, the Honolulu Advertiser recently reported.

Competition for state, federal and industrial funding to support university research is increasingly fierce in the U.S. Growing interest in developing academic research capacity, eroding state support for higher education and federal R&D budgets barely keeping pace with inflation, let alone absorbing the growing percentage dedicated to Congressional earmarks, are some of the reasons.

Washington State remains poised to capture more benefits from its technology-driven economy, according to the Index of Innovation and Technology released last month by the Washington Technology Center (WTC). As the state's lead organization to support science and technology, WTC publishes the Index to provide the state's decision makers with annual benchmarks for setting policy and  public investments to promote technology-based economic development.

The National Business Incubation Association (NBIA) recently held its 18th International Conference in Atlanta, honoring excellence in business incubation programs, graduates and client companies. NBIA, a nonprofit organization, works to advance incubation and entrepreneurship. This year’s recipients include:

Cleveland Fed: "Innovation, Growth, and Economic Policy in an Environment of Change,"

At a time when manufacturing jobs are relenting to the pressures of an expanded service sector, foreign competition and productivity growth, the idea of economic prosperity has a renewed urgency with innovation as the greatest strength and flexibility the greatest asset, argues a new report from the Federal Reserve Bank of Cleveland.

The Department of Commerce is accepting nominations for the 2005 National Medal of Technology awards, the nation’s highest honor awarded by the President to America's leading technological innovators.

2004 S&E Indicators includes chapter of state-level metrics

The U.S. remains the world's leading producer and net exporter of high-technology products, ranking among the global leaders in research and development (R&D) spending. However, ongoing economic and workforce changes make the outlook for the future uncertain, according to Science and Engineering (S&E) Indicators 2004, a biennial report of the National Science Board (NSB) to the President.

Whether it is "pink slip parties" in San Diego, the Washington DC beltway, or Chicago to encourage networking and placement of laid-off information technology (IT) workers or Wall Street analysts lamenting the condition of the tech-related stocks, much of the talk in the IT hot spots of the U.S. has been doom and gloom. Many other areas of the country, though, whose economies do not have a preponderance of dot-com companies that went bust are still trying hard to educate and retain IT workers.

The latest Issue Brief from the National Science Foundation (NSF) shows research and development (R&D) expenditures remain heavily concentrated in a few states. Ten states -- California, New York, Michigan, Massachusetts, New Jersey, Texas, Illinois, Pennsylvania, Washington, and Maryland -- account for nearly two-thirds of national R&D investments.

The Council on Competitiveness has received a $2.3 million federal grant to support the establishment of BEST, a new nonprofit organization designed to turn around the critical shortage of women and minorities in the high technology workforce. The National Science Foundation awarded the grant, which includes funds from the National Aeronautics and Space Administration, the National Institutes of Health, and the U. S.

The state-by-state results for the 2000 SBIR Phase II awards are presented on the accompanying webpage — as reported individually by 9 of the 10 participating federal agencies and compiled by SSTI. NASA awards will not be made until this fall. Totals may not reflect new awards or cancellations made by an agency after the initial award announcements. Abstract information for funded SBIR projects may be obtained on each agency’s SBIR website or by calling the federal agencies directly.

President Bush is nominating Floyd Kvamme as co-chair of the President's Committee of Advisors on Science & Technology (PCAST). Mr. Kvamme is a Partner with Kleiner Perkins, a high-tech venture capital firm based in California.