Education, infrastructure and budgets are all on the minds of the governors in this latest review of state of the state addresses. With more than half the governors having completed their outlooks by the end of January, this week we review the speeches through the end of month and find repeated attention to education, energy and budgeting issues, with a statewide lottery being introduced in Alaska, new energy legislation in Illinois, and South Carolina also proposed a funding increase for state universities that do not raise in-state tuition rates.

In 2019, the administrations and legislatures in many states grappled with if and how to adjust state economic development initiatives to leverage the federal Opportunity Zone (OZ) program. The actions of 12 states that implemented new activities are described below.

SSTI has reviewed the ballot initiatives across the country that affect innovation. Several states have energy initiatives on their ballots, while higher education funding is at play in Maine, Montana, New Jersey and Rhode Island. Utah could become only the second state to fund its schools through gas taxes, if a measure there is passed. At the same time, four states have ballot issues addressing redistricting commissions which could have a significant impact on state legislative makeup when lines are redrawn after the 2020 census.

Arizona

The ability of states to deliver the services promised to its residents relies on their fiscal soundness. With most states beginning their fiscal year in July, SSTI has reviewed the current fiscal standing for each state and here presents a snapshot of our findings.

Faced with one of the largest drawdowns in defense spending in American history, the Defense Manufacturing Assistance Program (DMAP) targeted affected companies and communities across Michigan, Ohio and Indiana for assistance. The program aimed to support economic stabilization and diversification across the region during the five-year period from 2013 to 2018.

Due to the effectiveness of employer-sponsored training program, U.S. states are working to build partnerships with industry partners that leverage public resources to help develop a 21st century workforce that addresses specific industry needs. Over the last month, partnerships have been announced between states and key industry leaders including AGCO, CVS, Tesla, and the U.S. Chamber of Commerce Foundation. Some of those collaborations are detailed below.

Across the country, the governors have begun delivering their State of the State addresses, an annual ritual where they have the opportunity to review where the state’s economy stands and preview their plans for the coming year. This year’s remarks reflect the dire conditions most states are experiencing with the pandemic, economic fallout, racial strife and national political upheaval. Despite the heavy focus on states’ efforts to respond to the pandemic, governors have struck a hopeful note and are focusing on recovery.

The Walton Family Charitable Support Foundation is making a $194.7 million grant to advance research and economic development at the University of Arkansas and will allow a new research institute to become reality. The grant is expected to grow the university’s cross-disciplinary research capability, expand the scope of discoveries made by U of A researchers and increase the speed in transferring such discoveries to the marketplace.

Last week, $6 million in funding was approved by the Michigan Strategic Fund for startup companies in the state. The $3 million Pre-Seed Fund III granted by the Michigan Economic Development Corporation will be administered by the Michigan State University Foundation and will support early-stage startups.

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.

Whether or not your state embraced strict measures in an attempt to reduce virus spread, the current pandemic has created the need for reflection and revision of how each of us go about our lives. The same opportunity has arisen for the public and private sectors to rethink how they engage in many core functions.

The U.S. Department of the Treasury announced today that five states — Hawaii, Kansas, Maryland, Michigan and West Virginia — have had their State Small Business Credit Initiative (SSBCI) capital programs approved by the agency.

The recently approved Inflation Reduction Act with new incentives for electric vehicle ownership and energy efficiency is likely to continue a trend among states for the location of major economic development projects, a trend toward everything mega—megasites, megadeals, mega factories, and mega projects.

Despite the success of Michigan’s numerous initiatives to provide tuition-free college, an analysis from New America exploring Michigan’s effort to increase the affordability and accessibility of higher education found that the fragmented approach reduces the state’s ability to reach all residents needing financial assistance.

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.

An inaugural report looking at the landscape of capital resources in Arkansas may be useful to others who are interested in examining the capital access in their state or region. The report will serve as a baseline for trends in public, private and philanthropic investments in entrepreneurship across the state and may be a useful resource as the state plans its State Small Business Credit Initiative strategy.

The U.S. Department of Treasury has announced its approval of $801.4 million in SSBCI funding for eleven U.S. states and territories: Arkansas, Delaware, Guam, Kentucky, New Jersey, Puerto Rico, Rhode Island, Tennessee, the U.S.

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 U.S. Department of Commerce recently announced the third major R&D facility as part of its CHIPS for America program. This new facility will be located at the Arizona State University (ASU) Research Park in Tempe, Arizona.

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.