The sixth installment of SSTI's Tech Talkin' Govs series includes excerpts from speeches delivered in New Hampshire and North Carolina. Our first five installments were in the Jan. 9, Jan. 16, Jan. 23, Jan.

Measuring impact is critical to the success and sustainability of any economic development initiative, and as the national debate over fiscal austerity and taxpayer spending continues, TBED organizations can expect increased scrutiny and accountability for their investments.

Over the past thirty years, state research and development (R&D) tax credits have become one of the most common state tools to boost their local technology economy. Few studies, however, have attempted to provide a comprehensive evaluation of their effectiveness. In this article, SSTI provides an overview of the literature on state R&D credits, examining why states introduce these incentives and whether or not tax credits are an effective policy tool to promote high-tech businesses and jobs.

After a lengthy legal process, the state Supreme Court unanimously ruled that the Missouri Science and Innovation Reinvestment Act (MOSIRA) — an incentive fund for science and technology businesses — violated a state constitutional requirement that bills address only a single subject. According to a Kansas City Star article, the judges upheld a ruling by a Cole County, MO, judge that lawmakers illegally included a clause making the fund contingent upon passage of a separate proposal overhauling the state's tax credit programs.

Last week, the SSTI Weekly Digest offered an overview of the many TBED-focused tax incentives currently under consideration in a number of state legislatures. Tax credits for research and development and for angel capital investment, in particular, appear to be under consideration in many parts of the country. At the same time, there appears to be a renewed emphasis on transparency in the operation and effectiveness of these kinds of tax credits.

With a continued push toward regionalism to better support the state's high-tech platform, lawmakers approved in the FY14 budget startup funding for a new statewide incubator program that provides grants for the incubators and tax incentives for client companies. The initiative is part of Gov. Andrew Cuomo's planned expansion for the state's 10 regional councils.

Maryland often has been at the forefront of innovation with a longstanding reputation for investing in science and technology to capture new opportunities for economic growth. This year's legislative session was no different. Lawmakers backed Gov. Martin O'Malley's proposals to support the state's bioscience sector, expand the R&D tax credit, enhance workforce training, and promote measures to establish the state as a leader in cybersecurity.

The budget agreement reached by Texas lawmakers earlier this week includes $50 million in new funds to provide grants to technology companies for research and commercialization activities under the Emerging Technology Fund (ETF). A bill to address accountability and transparency of the fund was passed in the House, but later removed from the Senate calendar despite controversy surrounding the decision-making authority of the grants.

Voters in 37 states will decide on more than 170 ballot measures this year, many of which are related to tech-based economic development (TBED). Tax measures seem to be dominating ballots this year, with questions relating to both decreases and increases for sales, property and income taxes. Several states are counting on voters to agree to temporary increases to help fill budget deficits and ensure steady funding for education.

Though innovation and entrepreneurship was notably absent from Wednesday's presidential debate on domestic policy, presidential candidates Mitt Romney and Barack Obama have acknowledged the importance of technological innovation in stimulating the economy and bolstering U.S. competitive capabilities in the global economy.

Wisconsin Gov. Scott Walker is the latest governor to call a special session focused on economic development proposals he says will create jobs (see the Sept. 7, 2011 issue of the Digest). Gov. Walker issued the executive order last week, calling it a "Back to Work Wisconsin" special session.

Building on several of the new programs enacted during the regular legislative session (see the June 15, 2011 issue of the Digest), Gov. Dan Malloy last week signed into law HB 6801, a comprehensive legislative package that authorizes $626 million in bonds to support efforts aimed at job creation. The bill has several components to support high-tech entrepreneurship, workforce development, and incentivize manufacturers and small businesses.

Lawmakers and technology industry leaders in Georgia and Kentucky are hoping to establish capital programs during the 2012 legislative sessions in an effort to support new business creation and remain competitive with states already offering lucrative incentives.

As many state legislative sessions wind down, a clearer picture of the current direction of state innovation policies is emerging. This week’s SSTI Weekly Digest presents a few of the major trends in technology-based economic development initiatives approved by state legislatures during their most recent sessions. While this review is not meant to be comprehensive, it should illuminate the shifts states are making to refine their investments in the high-tech economy by providing smarter, more targeted support.

Under a new set of proposed rules issued by the U.S. Department of the Treasury, companies will be able to claim the federal research and experimentation (R&E) tax credit on eligible expenditures regardless of any subsequent actions taken by businesses with the purchases. The change would allow businesses to claim the credit on research expenses used to create prototypes, pilot models and process improvements.