In the September 6, 2002 Issue:

Copyright State Science & Technology Institute 2003. Information in this issue of the SSTI Weekly Digest was prepared under a cooperative agreement with the U.S. Department of Commerce, Economic Development Administration. Redistribution to all others interested in tech-based economic development is strongly encouraged — please cite the State Science & Technology Institute whenever portions are reproduced or redirected. Any opinions expressed in the Digest do not necessarily reflect the official position of the U.S. Department of Commerce.

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PCAST Calls for More Balance in Federal R&D Investments
At its August 28th meeting, the President's Council of Advisors on Science and Technology (PCAST) approved sending a letter to President Bush urging him to "improve funding levels for physical sciences and certain areas of engineering" as the Administration prepares the FY 2004 federal budget request. The letter also encourages the federal government to establish a graduate fellowship program to attract more students into critical fields of science and engineering.

Considerable debate has been held regarding the past two federal budgets as appropriations for R&D in the life sciences, particularly within the National Institutes of Health, have grown faster than funding levels for the other sciences.

For the first time, the PCAST position expresses concern for an R&D imbalance at the highest levels of the Administration; John Marburger, director of the White House Office of Science and Technology Policy, is a co-chair for PCAST.

In the letter, PCAST raises concern for how federal R&D funding, while fundamentally responsible for 40 percent of the nation's patent activity, has declined as a percentage of Gross Domestic Product to its lowest level in more than 25 years. Private R&D does not adequately replace the federal investment, PCAST notes.

"Inadequate" federal investments in physical sciences and engineering "hurts all scientific disciplines," PCAST writes, and "jeopardizes economic growth."

The draft letter and accompanying report are available at: http://www.ostp.gov/PCAST/pcast.html

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Last day for early registration for SSTI's Sixth Annual Conference Building Tech-based Economies: From Policy to Practice! For more information, visit http://www.ssti.org/conference02.htm [expired].

Maryland Biotech Origins Outlined in TEDCO, DBED Study
Maryland Lieutenant Governor Kathleen Townsend recently announced the release of Founders of Maryland Bioscience and Medical Instrument Companies, a report on the career pathways taken by founders of biotechnology companies in Maryland.

Funded by the Maryland Technology Development Corporation (TEDCO) and the Maryland Department of Business and Economic Development (DBED), the report is part of the Bioscience Dialogue, a collaborative effort within the state's biotechnology industry to identify issues of importance to its growth. The $30,000 report traces the background of 276 company founders in Maryland and highlights these findings in bio-entrepreneurship:

The Johns Hopkins Institute for Policy Studies prepared the report, offering several policy and program recommendations:

Founders of Maryland Bioscience and Medical Instrument Companies is available at http://www.marylandtedco.org.

New Science and Technology Centers Planned for Maryland Counties
In a related story, DBED is entering into a partnership with Montgomery County to create a new science and technology center on the Germantown campus of Montgomery College. Another science and technology center will be located in Calverton in East County.

Montgomery County has committed $4 million to create the Montgomery County Science and Technology Center at Montgomery College. The money will partially fund the acquisition of an adjoining 20-acre parcel of land for the expanded facility. DBED has offered to make a $2 million equity investment in the center.

Early plans for the East County Center for Science and Technology, include a technology business incubator, higher educational facilities, a telecommuter center, a business park the County would lease to technology companies and a daycare facility.

With more than 200 biotech companies, Montgomery County is home to the third largest bio-industry cluster in the U.S. The two centers are the County's latest effort to create a fertile environment for technology companies. Both centers will be modeled after the Shady Grove Life Sciences Center, a biotech research and business park that is the hub of the County’s biotech industry.

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University of Wisconsin Takes Patents to San Diego
A public entity setting up a satellite office for promotion and business recruitment is not new. Many state economic development departments have done it for years in foreign countries to encourage international trade. State film promotion boards do it in Hollywood to attract movie projects to their home states.

But the University of Wisconsin has added a twist to the field office concept that is new and perhaps somewhat controversial.

The San Diego Union Tribune reported last week that the University of Wisconsin was establishing a patent licensing office in San Diego. The decision is reportedly the first of its kind by a U.S. academic institution.

From the casual observer's perspective, the decision may appear completely logical and a bit shrewd. San Diego is recognized as one of the nation's leading hotbeds for biotechnology, and the University of Wisconsin is a top medical research institution based on the amount of federal R&D funding it captures each year. Putting the two together to spin off more technology makes sense.

Across the country, states and academic leaders are pushing research universities to commercialize more technology and raise additional sources of revenue. With more than 150 spinoff companies to its credit, the University of Wisconsin is one of the more successful schools for turning technology developed within its labs into commercial products in the marketplace. According to the article, the new satellite patent office, armed with a portfolio of 1,600 technologies, will be looking to negotiate licenses with San Diego biotech firms.

A strong research university with a track record for licensing and a metro area ripe with biotech firms with which to partner are key ingredients for successful technology-based economic development. Reports such as the Milken Institute's America's High-Tech Economy: Growth Development, and Risks for Metropolitan Areas highlight the prominent role a research university plays on local technology-based economic development.

But when the commercialization occurs more than 2,000 miles away from the main campus, eyebrows are raised by at least a few observers in the field.

The university's prominence in biomedical research is the cornerstone of the state's $317 million public-private BioStar initiative, launched in 2000. Over an eight-year period, the state is providing matching funds to update, expand and create new research laboratories in the university system to support biotech research.

Touting the program in a State of the State address, then-Governor Tommy Thompson said, "The science being developed in our University laboratories is spawning new companies that make the technology and products, bringing new discoveries to the marketplace."

SSTI Annual Conference Plug
How can the returns on states' technology-based economic development investments be maximized if the commercialization and production of its universities' technology occurs outside the state's boundaries? How do states and universities achieve balance between their shared goals of strengthening the universities, capturing greater licensing revenues, and encouraging economic development?

These are the types of issues that will be discussed at SSTI's 6th Annual Conference Building Tech-based Economies: From Policy to Practice on October 2-3 in Dearborn, Michigan. One-fourth of the conference breakout sessions are focused on strengthening the university component of technology-based economic development. More information is available at: http://www.ssti.org/conference02.htm [expired]

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EDA Gives ACET $6.44M Grant
U.S. Commerce Secretary Don Evans has awarded a $6.44 million grant, the largest-ever economic development grant given by the Bush Administration, to Advancing California’s Emerging Technologies (ACET) to expand the Oakland Alameda Bio Tech Incubator to a 40,000-square-foot, state-of-the-art laboratory.

Once completed, the newly expanded building will be the largest of its kind west of the Mississippi, ACET director Sam Doctors said in a press statement. Housing nearly 40 high tech, biotechnology, environmental and energy start-up companies, the incubator will include fully equipped laboratory and office space, videoconferencing facilities, and other shared amenities.

Since May 1998, ACET has helped seven companies create nearly 1,000 jobs and generate close to $150 million in venture capital. The new ACET facility is expected to graduate 12-15 companies per year, help create 6,000 jobs to the Bay Area and attract nearly $1 billion in investment by the fifth year of operation.

Groundbreaking for the new building is expected in December 2002, with completion in 2004.

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Milken Assesses Manufacturing's Impact for California
Manufacturing is a robust driver of California's economy according to a Manufacturing Matters: California's Performance and Prospects, a new report prepared by the Milken Institute. The analysis was prepared for the California Manufacturing and Technology Association.

Milken found that the share of wages dependent upon manufacturing is above the national average. Average manufacturing wage and income was $54,600 in 2000 for California; the national average was only $43,400. Average California wages in computers and machinery is almost double the national average. Milken concludes these variances make California manufacturers targets for other state's industrial recruitment efforts.

Each manufacturing job also directly effects other non-manufacturing employment at higher levels than most sectors. For example, using the Regional Input-Output Modeling System developed by the U.S. Bureau of Economic Analysis, Milken found that direct effect employment multiplier for all types of manufacturing in California was 3.0. This means two other jobs are directly related or dependent on each manufacturing position in the state. Retail positions, for comparison, only directly effect 0.6 jobs in other sectors, the report discloses.

The analysis also revealed that the regional purchase coefficient — the percent of local demand for goods created by local production — was 2.4 times greater in California than the national average. This translates to 60 percent of California's orders for goods are filled in state versus a national average of only 25 percent. Since manufacturing is the state's most export-intensive sector, the strong regional purchase coefficient also demonstrates the significant wealth manufacturing generates for the state's overall economy: more of the money flowing into California from sales of manufactured goods stays within the state as it cycles through the production process.

Emphasizing the important role manufacturing plays in a strong local economy, the Milken Institute concludes that "economies like California's cannot truly be knowledge-driven if the knowledge its industries possess is only conceptual, and not applied. Without some form of manufacturing base, product innovation will be limited."

Included in the report are detailed analyses of manufacturing's contributions to the state's major and smaller metro areas and an appendix listing the types of industrial incentives offered by all 50 states.

Manufacturing Matters: California's Performance and Prospects can be downloaded at: http://www.cmta.net/index.php

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Summer Opportunities Lure Students Toward Tech Careers
Many efforts to encourage young Americans to pursue careers in science, engineering and manufacturing took advantage of students having the summer off from regular classes. Programs range from one-week science camps to season-long internships and cooperative workstudies. To help other communities begin planning for the end of the 2003 school year, SSTI highlights a few examples from this past summer in this article.

The Manufacturing Pathway Initiative, an education and training program based in western Pennsylvania, prepares students to enter careers or to pursue post-secondary education in the manufacturing industry directly upon graduation from high school. Open to a broad student audience, the initiative is a partnership of employers, high schools, vocational-technical schools, post secondary institutions, community programs, parents and students that focuses on demanding industry-based classroom work supplemented by worksite learning through internships with local manufacturers.

This summer, 80 students from 47 high schools in six southwestern Pennsylvania counties served internships at 41 companies throughout the region, as part of the initiative. The program is structured such that students enter a four-week hands-on paid internship following a two-week period of classroom training. Students are involved in many facets of the company in which they are employed and are expected to gain a thorough understanding of the company's internal and external operations.

The University of Maryland's incubator program enables students to intern with a company to pursue careers in S&T fields. The nonprofit Technology Advancement Program (TAP), which presently houses nine young companies, has graduated 43 surviving companies since being established in 1985. Coupled with its business school, TAP gives Maryland MBA candidates the opportunity to work as intern consultants. An intern's salary is roughly $20 an hour, half of which is paid for by the incubator companies. In return, the companies gain an employee with business experience for less than the cost of hiring a full-time MBA graduate.

Similar initiatives exist elsewhere around the country. At the University of Colorado, area high school students are given the chance to participate in the engineering college's Success Institute, a program for boosting interest in engineering. The 5-year-old program draws students to CU throughout their high school years. As a benefit to CU, students often will follow up their week-long participation in the institute, enrolling at the college after graduation.

While programs like CU's Success Institute and the Manufacturing Pathway Initiative are open to all types of students, other programs may focus on females or minorities and target younger audiences. A summer camp called "Girls and Graphics" held at the University of Arkansas, Fort Smith, for example, is designed for seventh-, eighth- and ninth-grade girls. In it, girls can further their interest in such fields as architectural technology and mechanical engineering by exploring the equipment and computer software used in the fields.

At the University of Illinois at Urbana-Champaign, the one-week long residential program GAMES (Girls' Adventures in Math, Engineering, and Science) is designed to give academically talented young women in grades 6-8 an opportunity to explore math, engineering, and science through demonstrations, classroom presentations, hands-on activities, and contacts with other women in these technical fields. Because interest in the four-year-old program has grown so quickly, this past summer the university offered separate structures and computer sciences camps, which accommodated a combined 86 girls.

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Useful Stats: Top 100 Cities for NIH Funding: 2000-2001
In each of the past two years, the National Institutes of Health (NIH) has published a list of the top 100 metro areas based on the total distribution of NIH funds. This year's table breaks down the total number of awards and dollar amounts by type of funding: research grants, training grants, fellowships, R&D contracts, and other awards.

New York City joined Boston this year as the only two metro areas to surpass $1 billion in total NIH funding. San Diego, Philadelphia and Baltimore round out the top five.

The NIH 2001 table is available at: http://grants2.nih.gov/grants/award/trends/citytop100fy01.htm

SSTI has prepared a table presenting the 2000 and 2001 top 100 cities for total NIH funding, the total and percent change between years, and ranking for each column. At 40.34 percent, Ithaca, NY enjoyed the greatest positive change between 2000 and 2001. The only other four communities with a positive change in excess of 30 percent were: Waltham, MA; Omaha, NE; Tampa, FL; and Bar Harbor, ME.  SSTI's table is available at: http://www.ssti.org/Digest/Tables/090602t.htm

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