In the October 31, 2003 Issue:

Copyright State Science & Technology Institute 2003. 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.

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Florida Enters Biotech Race with $510M Scripps Inducement
With a $310 million commitment passed by the state legislature and as much as $200 million in additional support from the county government, the California-based Scripps Research Institute has agreed to locate its first branch or satellite office in northwest Palm Beach County, Fla. In return for the financial support, Scripps is to work toward employing as many as 545 workers on the site by 2011. At $935,780 per job – if the 545 target is met over the eight-year period – the project could be the most expensive tech-based economic development risk yet undertaken by the public sector.

The state and county government will be providing Scripps the land, the infrastructure, the building, equipment and other physical assets for a state-of-the-art research laboratory and administrative complex. Scripps will supply the intellectual capital, potentially the human capital, and the prestige. Up to $155 million of the state's contributions may be repaid by Scripps over 20 years through royalties on technology developed at the new lab.

Florida, of course, is assuming that the new Scripps lab is only the first and most critical piece of the gambit. Gov. Jeb Bush compared it to the initial groundbreaking from Walt Disney World and the NASA Kennedy Space Center. The state is banking on other pieces to fall into place as a result: more federal life-science related research funding to the state's public research universities, spinoff companies from Scripps and university-generated technology, other companies being attracted to the area to be close to Scripps, royalty and licensing income, tax revenues from the higher-skilled employees and higher-valued properties, etc.

Gov. Bush projects overall, Scripps Florida's impact will boost the state's gross domestic product by $3.2 billion over the next 15 years and create 6,500 local jobs directly from spinoffs from Scripps Florida. The state projects an additional 44,000 jobs would be created by biotech firms that would locate near the institute.

Some of that enthusiasm stems from looking at the area surrounding the $280-million-a-year base operations for the Scripps Research Institute in La Jolla, Calif. The affluent community just north of San Diego is home to one of the world's largest concentrations of biotechnology firms — 40 said to have been spun out of the Scripps facility, alone, according to Florida media reports. La Jolla, however, also is home to the University of California, San Diego and the UCSD CONNECT program, elements of the vibrant entrepreneurial tech community lacking in the Palm Beach location.

The legislature took less than a week to review and approve the state's share of the inducement package. Caught in the wake – to the disappointment of economic development and university leaders in other parts of the state – were several tech-based economic development projects with much smaller price-tags that did not receiving funding. For example, $8 million for the  University of South Florida to purchase Tampa-area land for an 87-acre research park and bio-incubator dedicated to bioengineering and life science technologies, was dropped from the final bill, as was $10 million for the Natrional High Magnetic Field Laboratory in Tallahassee.

Scripps anticipates opening its Florida operations next summer with 31 employees.

More information on the announcement is available on Gov. Bush's website: http://www.myflorida.com/b_eog/owa/b_eog_www.html.main_page

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South Dakota Governor Sets Aggressive Targets In 7-year ED Plan
In 2010, the end of Gov. Mike Round's second term – should South Dakota voters choose to grant him one – residents of the state will have several precise ways to measure whether or not he delivered on his economic development goals. Gov. Round's 2010 Initiative, released Oct. 15 at Mount Rushmore, is built on a few, very specific and quantifiable goals in tourism revenues, entrepreneurship, and R&D. They include:

Each goal is accompanied by several specific action items for the newly formed Department of Tourism and State Development to undertake. For example, to help South Dakota "become a recognized leader in research and technology development by 2010," the state will create a research and development and tech transfer office in cooperation with the Board of Regents and the private sector, encourage the formation of tech centers and incubators, further develop university research niches, and coordinate cooperative public-private research partnerships.

Committed top-level leadership has proven to be a critical component of sustained success in tech-based economic development. Buy-in from a broad base of affected parties also is important for success. As elements of the plan were derived by engaging residents around the state in dialogues at four regional summits held in August and September, it appears South Dakotans are ready to embrace the effort with their governor.

More information on the 2010 Initiative is available at: http://www.2010initiative.com/

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U.S. Losing Ground in College Access, Participation
America has fallen alarmingly behind other industrialized countries in access to and participation in college, which encompasses most education and training beyond high school, according to a study recently released by the Education Commission of the States (ECS).

Closing the College Participation Gap offers a portrait of who is participating in postsecondary education and who is likely to be most at risk for losing access to such education. Accompanying state and U.S. profiles document the extent of postsecondary participation in each of the 50 states and the nation as a whole. They also examine the conditions likely to influence access and participation, calling attention to issues that must be addressed if the nation is to compete successfully in the global marketplace.

“According to the Organisation for Economic Co-operation and Development’s (OECD) most recent figures, the United States has fallen from 1st to 13th among developed nations in college participation leading to a bachelor’s degree in the last decade,” said Sandra Ruppert, ECS program director.

The study’s key findings, as depicted in the U.S. profile, include:

Closing the College Participation Gap, which draws mainly from U.S. Census 2000 data, is part of a multi-year initiative funded by the W.K. Kellogg Foundation. The initiative assists state policymakers and leaders in their efforts to expand opportunities for postsecondary access and to increase participation, especially among underserved and disadvantaged populations.

ECS is a national nonprofit organization that helps governors, legislators, state education officials and others identify, develop and implement public policies to improve student learning at all levels. To access state profiles online or to learn more about this initiative, visit ECS at http://www.ecs.org/ccpaccess.

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The Price of Venture Capital
Does it matter whether a start-up takes money from a large venture firm or a small venture firm? According to the just-released VentureOne Deal Terms Report, the answer is a resounding yes.

Using responses from executives at 269 companies that raised venture capital in 2002 and the first four months of 2003 paired with research from VentureOne, the report found that big venture firms – those with assets under management of $1 billion or more – take larger stakes in early rounds. In fact, investors in rounds led by large firms were likely to end up with 40 percent to 60 percent of a company more than half the time. In comparison, investors in deals led by small firms attained that kind of stake only 34 percent of the time.

Large investors also were more likely to enforce so-called "pay-to-play" provisions — clauses that force existing venture investors to return in later financings or risk losing their stake in a company.

However, the report suggests that while small firms may take smaller stakes and be less demanding of fellow investors, they are far more aggressive in getting protective provisions. Liquidation preferences, which are designed to guarantee investors a minimum return once a company is sold or taken public, were far more prevalent in rounds led by small firms than rounds led by larger venture capital firms.

The VentureOne Deal Terms Report is intended to be a resource for both venture capitalists and entrepreneurs who find themselves increasingly confronted with lengthy and complex term sheets. The report is available for $795 at: http://www.assetnews.com/products/reports/DealTerms.htm

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Tech Council News Briefs

Arkansas Tech Council in Formative Stages
The nucleus of a new regional technology council is taking structure in Central Arkansas. The Arkansas Capital Corp. has launched Techpreneur, a new forum for the area's biotech and information technology entrepreneurs to be modeled after Washington, D.C.-based Netpreneur. The fledgling group initially will allow people to share ideas and network, but additional activities such as mentoring and educational services may be added in the future.

Colorado Biotech Groups Merge
The boards of the Colorado Biotechnology Association and the Colorado Medical Device Association have unanimously voted to merge into a single stronger entity to be known as the Colorado BioScience Association. Combined, the two groups have more than 200 business members employing 17,000 people in the state. The new group will be based in the Colorado Bioscience Park Aurora and will be led by Denise Brown, former executive director of the Colorado Biotechnology Association.

Indiana Launches $72M Biotech Fund of Funds
Upgrading its marketing and branding efforts, the Central Indiana Life Sciences Initiative has rolled out a new identity for the organization: BioCrossroads. Following closely on the heels of the change was the announcement that the group has organized Indiana Future Fund I, a $72 million capital pool that will invest in regional and national venture capital funds, encouraging direct investment in Indiana life sciences opportunities. Managed by Credit Suisse First Boston, Indiana Future Fund I includes investments by Indiana’s public pension funds, Eli Lilly and Company, Anthem Blue Cross and Blue Shield, Indiana University, Indiana University Foundation, Purdue University, Ball State University Foundation, American United Life Insurance Company, Indiana State University Foundation and Guidant Corporation. More information on the fund is available at: http://www.indianafuturefund.com/

New York's Hudson Valley Gains New Tech Council
To strengthen the region's tech-based economic development efforts, the Dutchess County Economic Development Corporation and the Ulster County Development Corporation, in partnership with local academic institutions and technology businesses, announced the creation of the Mid Hudson Technology Council in mid-October. The new group will work toward supporting the growth of existing technology businesses, attracting new businesses, fostering technology start-ups, and encouraging partnerships that enhance the technological capability of the Mid Hudson region. In addition to the founders' steering committee, three volunteer committees are charting the design and early implemention of activities in education; partnerships, alliances and interfaces; and technology start ups.

Research Triangle Regional Partnership Identifies New Target Clusters
Business, academic and economic development leaders from the Research Triangle Region have agreed on eight technologies and a set of strategies to create jobs in both rural and urban areas for decades to come. The Research Triangle Regional Partnership, centering on economic development in a 13-county region, reports its efforts will focus on pharmaceuticals or "therapeutics," biological agents and infectious diseases, advanced medical care, analytical instruments, pervasive computing, nanoscale technologies, informatics, and agricultural biotechnology. The region also will continue its focus on building food processing, automotive components parts and logistics and distribution industries, which remain promising sectors for rural areas because of their interstate highways, available land and skilled labor.

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Upcoming S&T Events
Editor's Note: Because there are so many great conferences of potential interest to the technology-based economic development community, SSTI typically limits announcements to the calendar page on our website. The timely nature of two upcoming events leads us to a rare break with our editorial policy.

ASME Congress Presents Forum for Addressing Manufacturing Crisis
With much of the nation reeling from the structural upheaval of the U.S. manufacturing base, the world's largest gathering of engineers, industry leaders and policy makers could not come at a better time. The 2003 Congress and Research, Development and Design Expo will be held Nov. 15-21 at the Marriott Wardman Park and the Omni Shoreham Park in Washington, D.C. In addition to hundreds of committee meetings, the 2003 technical program offers eight industry tracks including Homeland Security, more than 550 reports, and the latest information on trends and advances in the mechanical engineering arena. One conference program that may be of particular interest to Digest readers is a session looking at ways to avoid the looming "train wreck" in manufacturing R&D, a phrase coined by the President's Council of Advisors on Science and Technology to describe the potential results of the U.S. continuing to under-invest in the physical sciences. Registrations received by Nov. 3 save $100. More information is available at: http://www.asmeconferences.org/congress03/

United Nations to Hold Science Park Forum in Philadelphia
The City of Philadelphia will host the United Nations Forum Science and Technology Parks: New and Emerging Technologies for Sustainable Development on Nov. 30 - Dec. 3. The conference is expected to draw participants from many countries with one thing in common — a desire to understand the requirements for establishing a successful science and technology park. Delegates will learn how to analyze their infrastructures, to identify what they will need in terms of resources and assistance, to define their next steps, and to develop relationships with those who can help them meet their goals. Forum attendees also will get a firsthand look at best practices on how some of the leading technology and research parks operate and the economic impact this powerful tech-based economic development tool can have on a region. Other Forum topics include identifying regional assets and linking to global opportunities, forging industry/academic/government partnerships and determining the requirements for establishing science and technology parks. More information is available at: http://www.ipphila.com/PhilaUNforum/

Additional conferences, workshops and programs are included in SSTI's Calendar of Events: http://www.ssti.org/calendar.htm

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Eight Scientists and Engineers Garner National Medals of Science
Eight of the nation's leading scientists and engineers were named on Oct. 22 recipients of the 2002 National Medal of Science — the nation's highest honor for researchers who make major impacts in fields of science and engineering. Administered by the National Science Foundation (NSF) for the White House, the medal recognizes career-long, ground-breaking achievements and contributions to innovation, industry or education.

James Darnell of Rockefeller University and Evelyn Witkin of Rutgers University were among those who received the medal for their advances in scientific theory and developments. Darnell discovered RNA processing, while Witkin confirmed the notion of DNA repair.

Leo Beranek of Cambridge, Mass., a retired leader in acoustical science for the military and the arts, received the medal for engineering.

James Glimm of Stony Brook University was honored for his work in shock wave theory and other cross-disciplinary fields in mathematical physics.

John Brauman of Stanford University received the award for chemistry. Three other honorees in the physical sciences include W. Jason Morgan of Princeton University, Richard Garwin at the Council on Foreign Relations in New York City, and Edward Witten of the Institute for Advanced Study in Princeton, N.J.

Recipients of both the National Medal of Science and the National Medal of Technology will be honored at a White House ceremony on Nov. 6. More information on the two prestigious award programs, as well as the Medal of Science recipients, is available through NSF's press release: http://www.nsf.gov/od/lpa/news/03/pr03121.htm

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Great Titles Added to SSTI Bookstore
Looking to launch a biotech initiative? Getting into commercializing university research? Are tight budgets leading to more rigorous program evaluation?

Even if you are simply wanting to help your community understand the importance of technology, any of these efforts should get easier with the 12 new titles added to Resources for Building Tech-based Economies, SSTI's publications catalog. A three-page supplement of the new titles is now available on the SSTI website and, combined with the full catalog, more than 125 great resources can help make your programs more effective and your job more rewarding.

As always, SSTI sponsors and affiliates receive a 10 percent discount on all purchases. Both the new titles supplement and complete catalog are available online as PDF documents at: http://www.ssti.org/Publications/publications.htm

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TBED People & Organizational Announcements

Bruce Mehlman, assistant secretary of commerce for technology policy in the Department of Commerce, will become the new executive director of the Computer Systems Policy Project on Dec. 1. Mehlman has run the Technology Administration's Office of Technology Policy since 2001.

The Association of University Research Parks has recognized Sandia National Laboratories for the 2003 Excellence in Technology Transfer Award. Over the past five years, Sandia has participated in 183 new cooperative research and development agreements with industry partners to jointly develop technology that is incorporated into commercial products. In addition, Sandia has had 1,472 technical advance disclosures, 639 new non-federal entity agreements to assist partners in addressing specific technical challenges, and 415 commercial licenses that have transferred technologies developed at Sandia to the private sector.

Congratulations to Del Schuh and his staff at the Indiana Business Modernization and Technology Corp. (BMT), honored as the Project of the Year in the Economic Development category from the National Association of Management and Technical Assistance Centers. The award, BMT's second in as many years from the group, was for a program entitled, "Moving from Distress to Commerce through Collaboration."

James Souby, executive director of the Western Governors' Association for the past 13 years, is resigning to become president and CEO of a new private think tank.

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