In the June 27, 2005 Issue:

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House Votes on FY06 Defense S&T Appropriations
As the House passed its version of the fiscal year 2006 defense appropriations bill last Monday, "Little R, Big D" once again may describe the country's R&D priorities for the largest component of the federal budget.

H.R. 2863 reduces overall funding for defense science and technology (spending categories 6.1, 6.2 and 6.3, respectively, referring to basic research, applied research and advanced technology development) to $13.04 billion -- 0.6 percent from the FY05 appropriations level but 23.9 percent higher than the Administration's request. Much of the $2.5 billion in restored funding, according to the American Association for the Advancement of Science (AAAS), is in the form of Congressional earmarks.

Nevertheless, actual spending for basic research (6.1) for the entire department would decrease by 4 percent from the FY05 appropriations. Applied research (6.2) would increase by 4.2 percent, and advanced technology development would be reduced 3.3 percent, AAAS reports.

All of the later stages of defense research, development, testing and evaluation - the 6.5 through 6.7 spending categories - have spending increases ranging from 3.1 percent for operational systems development (6.7) to 11.2 percent for systems development and demonstration (6.5). Advanced Component Development (6.4) is the only category the House cut deeper than the president, authorizing 5.8 percent less funding for FY06 than FY05.

Deciphering the budget by service and agency, AAAS reports basic research will decline from FY05 appropriations in all three major services: a 10.8 percent cut in the Army, 8.2 percent in the Air Force, and 11.2 percent for the Navy. For the defense agencies, on the other hand, basic research climbs 9.3 percent.

Spending for applied research grows to 8.5 percent for the Air Force, 8.2 percent in the defense agencies and 6.1 percent in the Army. Navy applied research drops by 13.2 percent in the House version of the budget.

One defense program element of interest to many Digest readers is the University Research Initiative. The AAAS summary states funding for the URI "would fall 8 percent to $271 million despite House additions to the request in the form of earmarks."

The AAAS summary is available at: http://www.aaas.org/spp/rd/

H.R. 2863 is available at: http://thomas.loc.gov/home/approp/app06.html

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Louisiana Creates New Orleans Bioscience District
With hopes of creating a geographic concentration of academic and private bioscience research and commercialization, the Louisiana legislature ended its 2005 session with passage of a bill creating a new development authority. House Bill 742, the Greater New Orleans Biosciences Economic Development District Act, focuses on an area of several blocks in downtown New Orleans, but the bill grants the district's board the ability to redefine its boundaries by additional properties, including those outside the Orleans parish. The district may issue bonds to support acquisition of land and construction of buildings and other facilities.

The district, as currently defined, already includes the Louisiana State University (LSU) Health Sciences Center, Tulane Health Sciences Center, the Louisiana Cancer Consortium, the Louisiana Gene Therapy Consortium, Delgado School of Nursing, the VA Medical Center, Charity Hospital and Xavier University. The bill's authors hope the district will anchor a growing cluster in the health and bioscience sectors that already employs 60,000 in Greater New Orleans.

The Act also grants the district broad economic development powers. How broad are the district's powers? In wording that might be the envy of any tech-based economic development program manager who believes her or his own enabling legislation borders on legislative micromanagement, Louisiana's House Bill 742 grants the district the "special powers to undertake any project or program beneficial to the district whether within or outside the boundaries of the district."

Governance for the district will be overseen by a new 13-member board comprised of leaders from Tulane, LSU, Xavier and Delgado Community College; the mayor of New Orleans and three appointees of the mayor; four appointees of the governor, and the secretary of the state department of economic development.

The bill awaits the signature of Gov. Kathleen Blanco, who supported the legislation. According to the Times-Picayune, the legislation has undergone numerous amendments pushed by Gov. Blanco and LSU, including diluting the role of business leaders on the governing board and requiring the district to operate within state public meetings and record laws.

Critics of the bill raised concerns over the board's authorization to seek voter approval for property tax increases and that the district may infringe on the authority of LSU and the other universities involved, the Times-Picayune reports.

H.B. 742 is available through the Louisiana State Legislature at: http://www.legis.state.la.us/

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GAO Reviews Defense Technology Transition Programs
Technology commercialization can be a slow and arduous process, often taking years to reap the benefits of the investment. Recognizing that defense technology innovations move too slowly from the lab to the field, Congress created three programs within the Department of Defense (DoD) to speed and enhance the transition.

The Government Accountability Office (GAO) recently reviewed the oversight of the programs and offered recommendations to DoD. The three technology transition programs target relatively small projects and have a budget consisting of a combined $64 million in 2005.

The Defense Acquisition Challenge Program (DACP) was created in fiscal year 2003 to identify and introduce innovative and cost-saving technology and products within DoD's science and technology community and externally into existing acquisition programs. The program's objectives include expanding opportunities for emerging defense suppliers and widening the U.S. defense industrial base, according to the report. Completion time for projects is up to three years and 30 projects were funded since its creation. The report identifies examples of DACP projects, including a collapsible stock for the M-4 rifle, and enhanced optics system from the Rolling Airframe Missile that will permit all-weather operational capability.

While DACP focuses on introducing new technologies, the Technology Transition Initiative accelerates the introduction of new technologies into operational capabilities for the armed forces. Projects include an ink pen-size device that purifies water, and a custom earplug that provides blast noise protection and increased communication capabilities. Since the initiative's inception in 2002, 21 projects were funded with a completion time of up to four years, the report states.

The Quick Reaction Fund fields and tests prototypes that respond to immediate and emerging warfighter needs. With an accelerated completion time of 6-12 months, the program provides flexibility to respond to emergent DoD issues and address surprises and needs in real time, according to Acquisition Community Connection. Examples of projects include a greaseless M-4 rifle that is more suitable for desert operations and a chemical and biological detection capability for small unmanned aerial vehicles. DoD funded 17 projects since its inception in 2003.

Although the GAO states it is too soon to determine the impact of these programs, reports have pointed to an array of benefits that include quicker fielding of technological improvements, cost savings, and the opportunity for DoD to tap into innovative technologies from firms that are new to defense work. The programs are appropriately targeted on speeding technology transfer, GAO concludes. However, it warns the programs' long-term success will ultimately hinge on how well DoD manages the initiatives.

Recommendations for action include:

According to the report, DoD partially concurred with GAO's recommendations. DoD states that it does not agree that the Quick Reaction Fund fits the definition of a transition program, which is a main cause for the partial concurrence. The full report is available from GAO at: http://www.gao.gov/docsearch/abstract.php?rptno=GAO-05-480

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Useful Stats
SBIR Awards, Proposals by State for FY 2003
With SSTI's compilation of the FY 2003 Small Business Innovation Research (SBIR) proposal and award statistics by state, tech-based economic development programs - specifically SBIR assistance and outreach efforts - now have the requisite data to evaluate conversion trends for most agencies during the four-year period 2001-2004.

The use of trends over a number of years, rather than single year "snapshots," can be useful for refining a state or local program's efforts, particularly if the program has held conferences, outreach, proposal assistance targeting specific federal agency solicitations or technologies. Trend data also helps to reveal how Phase I awards made within a state are tracking with the overall proposal, award and conversion rates for each agency and comparable states.

For FY03, SSTI has aggregated Phase I award, proposal and award-to-proposal conversion percentages for all 50 states and the District of Columbia for nine of the 10 participating agencies -- Environmental Protection Agency proposal statistics were unavailable and the Department of Homeland Security was not a participant yet. The 2003 table is available at: http://www.ssti.org/Digest/Tables/062705t.htm

SSTI also has compiled similar tables for 2001, 2002 and 2004:

FY 2004: http://www.ssti.org/Digest/Tables/042505t.htm
FY 2002: http://www.ssti.org/Digest/Tables/090503t.htm
FY 2001: http://www.ssti.org/Digest/Tables/051002t.htm
FY 2000 (no proposal figures): http://www.ssti.org/Digest/Tables/030901t.htm

As with the FY04 SBIR stats released earlier this year, SSTI owes a debt of gratitude to Chris Busch, formerly a consultant to the SBIR program of the Idaho EPSCoR office. Dr. Busch obtained much of the FY03 data for the now-defunct Idaho SBIR Competition News that SSTI plugged into its SBIR table. Other information was gathered directly from the federal agencies.

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People

James Epolito, the former president and CEO of Accident Fund Insurance Co. of America, will become president and CEO of the Michigan Economic Development Corp. (MEDC) effective Sept. 1. The current MEDC president and CEO, Donald Jakeway, will lead MEDC's international economic development efforts.

President and CEO of the Arizona Technology Council, Todd Bankofier, is resigning his position on Aug. 26 to become vice president and general manager for Ensynch Inc., a Tempe-based information technology services and solutions consulting company.

ACCRA, a national nonprofit research organization, has named Jeffrey Blodgett of the Connecticut Economic Resource Center (CERC) as president of the Board of Directors for 2005-06, beginning July 1.

Terry Blum, dean of Georgia Tech's College of Management, will resign her position on June 30, 2006.

The Indiana Health Industry Forum announced James "Mike" Brooks accepted the position of president and CEO effective July 11.

Randy Goldsmith resigned his position as president and CEO of the San Antonio Technology Accelerator Initiative (SATAI) Network to become assistant vice president of tech transfer and economic development at the University of Texas at San Antonio. SATAI is currently accepting applications to fill the vacancy (see item below).

Jeff Moseley will replace Jim Kollaer as president and CEO of the Greater Houston Partnership.

Purdue University professor Jerry Woodall was chosen to lead the university's Burton D. Morgan Center for Entrepreneurship.

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SATAI Seeks President & CEO
The San Antonio Technology Accelerator Initiative (SATAI) Network, a nonprofit organization, is accepting applications from qualified candidates to fill the position of President and CEO. The SATAI Network seeks someone with strong leadership and team-building skills, as well as experience in linking venture capital to venture creation and cultivating an environment and resources for start-up enterprises. A bachelor's degree and at least five years of experience in business/economic development within a private or public sector technology-based industry or organization are required. An MBA is desired. Applicants are due July 11, 2005. A complete job description is available through the SSTI Job Corner at http://www.ssti.org/posting.htm.

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2005 SSTI Conference Offers Two IEDC/CEcD Credits with Tech Square Workshop
SSTI's annual conference is already considered by many to be the nation's premier educational and networking experience for the tech-based economic development community. However, the ninth annual conference to be held October 20-21, 2005 - keeping with years past - gives certified economic development professionals even more reason to attend. Investing in a Brighter Future: Building Tech-based Economies will be recognized by the International Economic Development Council (IEDC) as a professional development event that counts as one credit toward recertification of Certified Economic Developers (CEcD).

In addition, this year for the first time certified economic developers can earn a second recertification credit by participating in SSTI's preconference workshop examining the success of the renowned Technology Square complex at Georgia Tech.

Technology Square: Proving the Power of TBED
Five years ago, Midtown Atlanta's Fifth Street Corridor - adjacent to the Georgia Institute of Technology campus - was a wasteland of used car lots, run-down warehouses and parking lots. Today, thanks to a model public-private effort that has involved an investment of more than $400 million, the area is a bustling educational, commercial and research district, home to a Georgia Tech campus expansion. The mixed-use Fifth Street Corridor is now a hotbed of technology industry and the new hub of Georgia's economic development community.

Technology Square is home to nearly two-dozen start-up technology companies that are associated with the Advanced Technology Development Center, one of the world's top university-affiliated incubators. Technology Square also is headquarters for the Economic Development Institute ­ known for providing engineering extension services to Georgia industry statewide ­ and economic development organizations ranging from the Georgia Department of Economic Development to the state's Quick Start worker training program.

Savvy tech-based economic developers visiting Technology Square might wonder if a similar public-private initiative could turn around sections of their communities. Technology Square is unique, but there are many reasons why Atlanta's award-winning "Intersection of Innovation" can serve as a great model for other universities and communities that want to build tech-based economies.

For this day-long, intensive preconference workshop, SSTI is working with the Advanced Technology Development Center to show participants the keys to Technology Square's success. We'll hear directly from the people who made it happen: from concept and planning to financing and management.

As the workshop will be conducted on-site at Tech Square, please note that attendance will be limited to ensure the maximum value for preconference registrations. More information, including topics to be covered during the day and a registration form for the full conference, is available at: http://www.ssti.org/Conf05/preconference.htm

More Information on Becoming a Certified Economic Developer
The IEDC CEcD program is designed to unite the economic development profession around a core level of professional competency in eight topic areas. To sit for the certification exam, prospective candidates must have 10 years of professional experience, or at least four consecutive years of paid experience, and a series of professional development training courses across at least six of the nine competency areas. Sixteen hours, or the equivalent, of professional development in two additional areas of economic development also are required.

An important goal of the CEcD program is to ensure that those who are certified continue their own professional development and continue to contribute to the profession. IEDC recognizes the attendance of select non-IEDC events as a way for a CEcD to contribute to her or his recertification.

IEDC encourages members of the economic development community to participate in nationally recognized events, such as SSTI's ninth annual conference, to increase their knowledge, enhance the profession and participate with peers in the field.

Join us at SSTI's Ninth Annual Conference!
Investing in a Brighter Future: Building Tech-based Economies will be held in Atlanta on Oct. 20-21, 2005. In addition, four intensive preconference workshops will be held on Oct. 19. Registration and other information is available through SSTI's annual conference web portal: http://www.ssti.org/conference05.htm

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