NATCAST, the operator of the National Semiconductor Technology Center (NSTC) tasked with bolstering the United States' semiconductor industry, announced Albany NY and Sunnyvale CA as the locations for two major R&D facilities. The funding comes from the CHIPS and Science Act of 2022, legislation aimed at revitalizing American semiconductor manufacturing and research.

While most of the country’s attention has been on the contests for control of the White House and Congress, eleven states and two territories, including Puerto Rico, held gubernatorial elections on Nov. 5. Voters in eight of those states (Delaware, Indiana, Missouri, New Hampshire, North Carolina, North Dakota, Washington, and West Virginia) were choosing a new governor to replace either a term-limited incumbent or governors who chose not to seek re-election. In Montana, Utah, and Vermont, governors seeking re-election, handily won. Information on the winners and their views on economic development follows.

Since the pandemic, those working on local prosperity through the nexus of science, technology, innovation, and entrepreneurship—the four cornerstones of SSTI’s mission—have seen the largest investment yet by the federal government to catalyze and support their work. It awakened teams of organizations across the country in virtually every city, institution of higher education or region to start or improve innovation-centered economic development strategies.

As SSTI reported earlier this fall in its series of articles on higher education, college tuition and student loan debt are rising. In a recent report from the National Conference of State Legislators (NCSL)—the first such comprehensive report from that body since they convened the Blue Ribbon Commission on Higher Education in 2006—a task force comprised of 29 legislators and four legislative staff from 32 states concluded that increased federal efforts to address these tuition and loan issues "quietly expanded the federal footprint in higher education," and so now calls for a rebalancing of the state-federal relationship regarding higher education. They propose a national strategy for the federal government, states, and higher education institutions to improve the public perception of higher education.

When Tennessee reported on its first cohort of students after implementing Tennessee Promise, the nation’s first statewide free community college effort, SSTI reported on the program’s impressive early results. The graduation rate had increased over the previous year’s non-Promise cohort, and overall, 3,257 students in the 2015 cohort earned a degree or certificate within five semesters, an 82% increase over the pre-Promise 2014 group. Earlier this year, the Tennessee Higher Education Commission (THEC) marked the program’s 10-year milestone, announcing over 150,000 enrolled students and $207 million in funding since its inception in 2014.

The European Union is engaged in a debate about changing its systems for R&D funding, the first potentially significant changes since its current framework program began in 1984. A group of 15 individuals from research and industry selected by the European Commission last year has submitted a report, Align, act, accelerate, which gives recommendations for overhauling the system. These recommendations are aimed at the remaining three years of Funding Program 9 (FP9)—Horizon Europe (2025-2027) and preparing for the next European Research and Innovation Framework Programme, FP 10 (2028-2034).

The U.S. National Science Foundation Regional Innovation Engines (NSF Engines) program announced that 71 teams are advancing to the next stage of the second NSF Engines competition. Of the 71 teams invited to submit full proposals to the NSF Engines program, 23—or nearly one-third—are led by nonacademic organizations; 13 are led by organizations new to NSF funding; 23 are led by organizations located in NSF Established Program to Stimulate Competitive Research (EPSCoR) jurisdictions; and nine are led by a minority-serving institution. In addition, nearly half of the teams received an NSF Engines Development Award.

Whether one calls them transformational or disruptive, challenging or exciting, topics like generative AI, Big Tech, climate change, and geopolitical/economic issues will have significant influences on the future focus and efforts of every organization employing readers of this newsletter. There hasn’t been a forum for the field to talk about all of it openly and honestly—until December, that is. 

The Appalachian Regional Commission (ARC) awarded $33.5 million to 12 collaborative, multi-state projects designed to drive large-scale economic transformation. Funded through ARC’s Appalachian Regional Initiative for Stronger Economies (ARISE), these projects bring together more than 145 partners across all 13 Appalachian states to strengthen workforce and educational opportunities, infrastructure, and entrepreneurship. Four of the 12 awards have direct ties to innovation and tech-based economic development.

A new White House national security memo (NSM) builds on last year’s Executive Order on AI and calls for the U.S. government to act quickly to the use of AI capabilities in service of national security. It also specifies actions to improve the security and diversity of chip supply chains, among other directives.

Manufacturing industries accounted for approximately $372 billion, or 54%, of all domestic business enterprise R&D (BERD) expenditures in 2022, up 36% from $274 billion in 2018. Despite this increase of nearly $100 billion over the past five years, the share of BERD expenditures in manufacturing industries has decreased eight percentage points from its 2018 value of 62%. Meanwhile, companies in nonmanufacturing industries captured by the BERD survey outpaced their counterpart’s growth, having increased $152 billion, or 91%, over the same period, leading to an eight percentage point increase in share of total—from 38% to 46%.

Congress authorized $10 billion over five years for regional tech hubs to improve America’s competitiveness and regional economies. To date, Congress has appropriated only $541 million for the program—just 5% of the authorized level—of which a $459 million downpayment was provided though the FY 2023 disaster supplemental. SSTI is working with other technology and innovation organizations to encourage Congress to act and fund the program through annual appropriations, supplemental funding, and the proceeds of spectrum auctions—a new means that would be made possible by the Senate’s Spectrum and National Security Act. If you represent or participated in one of the 370 regions that applied originally or want to compete for funding in future solicitations, sign on to a joint letter by November 12.