In the February 20, 2006 Issue:

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Tech Talkin' Govs 2006, Part Four
The first three installments of SSTI's four-part look at how TBED will play in the 2006 legislative priorities of the governors can be found in the Digest archives at: http://www.ssti.org/Digest/digest.htm

Oklahoma
Gov. Brad Henry, State-of-the-State Address, Feb. 6, 2006
"While the energy and agriculture industries will always be vital to Oklahoma and its economy, we must be prepared for the demands and innovations of the marketplace of the future.

"This session I am sending you a comprehensive package to meet the challenges ahead. Our 'Invest in the Future' initiative will build on the research endowment we created last year. We will fund cutting-edge research and projects that promise the greatest potential for economic opportunity and job creation.

"Establishing an Opportunity Fund will help close the economic development gap, making Oklahoma more competitive and better able to attract and retain good jobs. ...

"... Leveraged by a $180 million bond issue, we will stimulate cutting-edge research. We will invest in sensor technology at Oklahoma State University. We will invest in cancer and diabetes research at the University of Oklahoma. And, we will support private-sector research throughout the state. It is critical we equip ourselves with every tool needed to develop a research infrastructure that will fuel our long-term prosperity."

Wyoming
Gov. Dave Freudenthal, State-of-the-State Address, Feb. 13, 2006
"Last year you passed and I signed the Higher Education Endowment package. That legislation helped meet our commitment to provide Wyoming citizens with a college education as nearly free as possible and to continue the improvements at the university and in our community colleges. Implementing legislation will be presented this session to jump start and fully fund by the end of the biennium the endowed shares of the Hathaway Student Scholarship Fund (see the March 14, 2005 issue of the Digest). ...

"... I encourage your support of the statutory and budget proposals to move our clean coal and enhanced oil recovery efforts. In this connection I would draw special attention to the proposed Energy School at the University of Wyoming. We have worked for many years to move this idea to reality. I ask you to pass this legislation with a restriction limiting the university's ability to spend funds pending development by the advisory committee of a Strategy for Excellence to guide the development of the school."

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Recent Research
International University Strength Moving R&D Offshore, In Addition to Cost
Contrary to popular belief, intellectual capital and university collaboration - not just lower costs - primarily attract companies to locate R&D activities in locations away from their home country, according to a new study sponsored by the Ewing Marion Kauffman Foundation.

Dr. Marie Thursby, professor of strategic management, Georgia Tech College of Management, and Jerry Thursby, chair of the Department of Economics, Emory University, surveyed more than 200 multinational companies across 15 industries, mostly headquartered in the U.S. and Western Europe. Their findings indicate that emerging countries such as China and India will continue to be major beneficiaries of R&D expansion over the next three years as companies seek new market opportunities, access to top scientists and engineers, and collaborative research relationships with leading universities.

To identify and rank the importance of different factors feeding into the corporate decision-making process on locating R&D facilities, the study tracked R&D work coming into the U.S. from abroad and R&D work going in the reverse direction; addressed favored countries for locating R&D work and why; and outlined trends industry expects for R&D expansion in the future.

Among the top factors going into new R&D siting decisions in both developed and emerging countries are market growth potential, quality of R&D talent, collaboration with universities and IP protection. How these factors influence the decision, however, depend on whether the site is in a developed or emerging country. In neither emerging nor developed countries was cost consideration the most important factor, which runs contrary to what has been reported by the media.

Among the study's more surprising findings, according to the researchers, was the role university collaboration plays in the decision-making process for locating R&D facilities. In fact, collaboration with universities was particularly prevalent as a factor for expanding to emerging countries, even though these countries provide lesser degrees of IP protection.

More than half of the corporate respondents who identify the U.S. as their home country report that they have either recently expanded or planned to locate R&D facilities in China and India vs. other developed countries. Of 63 Western European companies responding, 13 plan on expanding or locating new R&D facilities to the U.S.

The issue of collaborative research between universities and corporations has been a growing concern within the U.S., with some observers saying legal wrangling over intellectual property rights is not only slowing the pace of innovation but also prompting companies to seek university research partners in other countries.

The study indicates, however, that while the trend toward R&D offshoring to Asia will continue despite concerns over IP protection, companies are keeping their most cutting-edge research in developed countries where IP protection is the strongest. According to the study, only 22 percent of the R&D effort in emerging countries is for new science.

Another public policy implication of the findings, say the researchers, is that the U.S. must focus on highly skilled worker immigration.

"We are educating the best and the brightest, but make it impossible for them to stay in America and immigrate," Dr. Marie Thursby said. "We need major immigration reform that welcomes, instead of pushes out, highly skilled workers."

Further information about the study can be downloaded at www.kauffman.org .

Links to this paper and more than 3,000 additional TBED-related research reports, strategic plans and other papers can be found at the Tech-based Economic Development (TBED) Resource Center, jointly developed by the Technology Administration and SSTI, at http://www.tbedresourcecenter.org/.

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Singapore Plans $4.6B R&D Investment
Hard evidence of the increasing global research competence discussed in the Thursby's paper above was provided last week when the Singapore Ministry of Trade & Industry (MTI) announced plans last week to commit $7.5 billion ($4.6 billion US) over the next five years to sustain innovation-driven growth through economic-oriented R&D. All figures below are in U.S. dollars.

To help Digest readers to appreciate the size of the commitment, Singapore had an estimated population of 4.4 million residents in July 2005, which would rank it 25th among U.S. states -- comparable to Colorado, Alabama, Louisiana, South Carolina or Kentucky in population size.

MTI’s R&D plans are set out in the Science & Technology Plan 2010 (STP2010), released Feb. 16 by Minister for Trade and Industry Lim Hng Kiang. STP2010 is part of the Singapore Government’s overall strategy to make significant investments in R&D in the next five years, so as to increase national spending in R&D to 3 percent of gross domestic product by 2010. The National Research Foundation will coordinate the research of different agencies within the larger national framework, as well as develop policies and plans to implement the strategic thrusts for the national R&D agenda.

The national government's investment is distributed through the two lead economic agencies for promotion of R&D: the Agency for Science, Technology and Research (A*STAR) and the Economic Development Board (EDB). Of the total, $3.3 billion would go toward promoting economically relevant public sector R&D by A*STAR. Another $1.3 billion would go toward private sector R&D investments by EDB.

STP2010 aims to sustain innovation-driven growth by strengthening R&D capabilities in both the public and private sector. This would be achieved through four key programs:

Singapore's five-year S&T plan is available at: http://app.mti.gov.sg/data/article/2001/doc/S&T%20Plan%202010%20Report.pdf

Links to this paper and more than 3,000 additional TBED-related research reports, strategic plans and other papers can be found at the Tech-based Economic Development (TBED) Resource Center, jointly developed by the Technology Administration and SSTI, at http://www.tbedresourcecenter.org/.

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Tech-based ED Prominent in Illinois Governor's '07 Budget Request
Stem cell research, an expanded tax zone redevelopment initiative and faculty/researcher recruitment are all beneficiaries in the fiscal year 2007 budget proposal submitted by Illinois Gov. Rod Blagojevich last week. In addition, while overall funding for the state Department of Commerce and Economic Opportunity (DCEO) is down 16 percent from the FY 2006 appropriation, the governor's request includes several new programs to assist technology entrepreneurship. Highlights of the economic development portions of the budget are provided below.

$15M More for Stem Cell Research
During his Feb. 15 budget address, Gov. Blagojevich announced a new initiative for funding stem cell research. By executive order in July 2005, Gov. Blagojevich created the Illinois Regenerative Medicine Institute and awarded $10 million in grants to support stem cell research (see the July 18, 2005 issue of the Digest). Under the governor's new initiative, $100 million over five years would be dedicated to the institute to continue research efforts. Funding would be made available by using a portion of the state's share of tobacco settlement funding. The budget request includes a $15 million grant for FY07, which would increase by $2.5 million annually.

River Edge Redevelopment
The governor also unveiled the proposed River Edge Redevelopment Initiative, which is part of his Opportunity Returns economic development strategy. The initiative includes the designation of redevelopment zones across the state that will be eligible to receive tax credits, exemptions and $20 million in new grant funding to support clean-up, remediation and redevelopment efforts leading to economic revitalization.

SBIR, Tech Entrepreneurship
The general fund budget request for DCEO is $67.8 million, down from the enacted $80.8 million in FY06.  Funding for new programs within DCEO includes $1 million for the Innovation Challenge Grant Program to assist companies by providing bridge funding for SBIR/STTR grants and $1 million for the Entrepreneur-in-Residence Program to develop management talent and serial entrepreneurs. Funding requests for existing programs within DCEO include:

Gov. Blagojevich's Budget Plan for FY 2007 is available at http://www.illinois.gov/.

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Connecticut Governor Announces Plans to Reorganize ED Efforts
Connecticut Gov. M. Jodi Rell is using the midterm budget request as the vehicle to substantially overhaul how the state supports the entire economic development process. Connecticut Innovations, one of the nation's oldest state-created equity finance programs for tech businesses, would be consolidated with departments that cover focus areas ranging from health education and housing to traditional economic development financing.

During her State-of-the-State Address earlier this month, Gov. Rell unveiled her fiscal year 2006-07 midterm budget adjustment proposal and announced plans to restructure the Department of Economic and Community Development (DECD). Under the plan, the new Department of Business and Employment (DBE) will provide programs previously administered by DECD, but with enhanced planning and programmatic features, according to the governor's office:

Additionally, a new Office of Economic Policy will be created within the governor's office to coordinate the efforts of the new Connecticut Finance Collaborative, which would be the successor organization of the Connecticut Development Authority, Connecticut Innovation Inc., and the Connecticut Health Education Finance Authority. According to the governor's office, in merging the authorities, the state can improve program coordination and provide more comprehensive services to attract businesses and create jobs.

The governor's proposed budget also includes workforce-related initiatives in the Labor Department and tax credits for businesses to keep the state competitive:

Within the Department of Higher Education, Gov. Rell is proposing a new $3 million loan forgiveness plan to encourage college students to choose work within "high needs" fields of the state, including information technology. Under the plan, about half of the money would be made available to students who plan on becoming math or science teachers.

The governor's FY 2006-07 Midterm Budget Adjustment is available at: http://www.opm.state.ct.us/budget/2007MidtermBooks/2007GovMidtermBudget.htm

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Recent Research
Most States Lack Measurable Goals for Higher Ed
Improving higher education is a top priority in almost every state, but fewer than half of states have set specific, measurable goals to track their progress in enrolling, retaining and graduating students, according to a new report from Jobs for the Future (JFF), By the Numbers: State Goals for Increasing Postsecondary Attainment.

The Boston-based nonprofit organization found just 23 of the 50 states have set at least one numerical goal for increasing the number of students who enroll in college, stay in college, and graduate with a college degree. Only 10 have set numerical goals for all three. In addition, only 11 have set even one goal related to improving the success rate among minority students.

"States are spending $63 billion a year on higher education, but if they don't quantify what they're trying to accomplish, it's going to be impossible to tell when they've succeeded," said JFF President and Chief Executive Officer Marlene Seltzer.

The report is the result of JFF's 50-state survey of statewide higher education plans. In addition to which states set numerical goals, the research also examined plans with a specific emphasis on numerical goals for student access and success, the rationale used in setting them, whether the goals sought to address gaps among different ethnic or income groups, and the methods used for measuring progress. States' efforts to inform the public about higher education goals and their importance also were tracked.

Although a small cadre of states are commended for setting goals, of particular concern is the lack, in most states, of any goals aimed at increasing success rates among minority students. Only eight states set goals for increasing the number of minority students in college, and only four had one or more goals for increasing minority graduation rates. The 11 states identifying goals for increasing minority enrollment, retention or graduation include Florida, Louisiana, Missouri, North Carolina, New Jersey, Nevada, Oregon, Pennsylvania, Tennessee, Texas and Utah. Given the changing demographics of many states, failure to address these achievement gaps could potentially have a major impact on states' economic well-being into the future.

Of the states that set higher education goals, increasing the number of students who enroll in some form of postsecondary education was the one most commonly identified -- 20 states set such a target. Nineteen states set goals for the number or percentage of students who complete a degree, and 10 set goals for retention, a term that usually refers to the proportion of first-time, full-time freshmen that continue into their sophomore year.

The report highlights the importance of a comprehensive plan for getting students in and through higher education. Ten states have set goals for improving outcomes in all three key areas -- enrollment, retention and graduation. They are Alaska, Missouri, New Jersey, Louisiana, Oregon, Pennsylvania, Tennessee, Texas, Virginia and Wyoming. Kentucky also stands out for its unique approach, the report states, incorporating its higher education goals into a broad plan to meet statewide economic needs. The plans implemented by both Kentucky and Texas are discussed in detail in the report as examples of this comprehensive approach.

The full report, including state-by-state data, is available at http://www.jff.org/jff/kc/library/0269.

Links to this paper and more than 3,000 additional TBED-related research reports, strategic plans and other papers can be found at the Tech-based Economic Development (TBED) Resource Center, jointly developed by the Technology Administration and SSTI, at http://www.tbedresourcecenter.org/.

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Useful Stats
Top 100 Cities for 2004 NIH Funding
Despite a decrease of $44.6 million in National Institutes of Health (NIH) funding from fiscal year 2003,  Boston held the top spot in total NIH funding for FY 2004, maintaining its lead over New York. The two cities had $1.57 billion and $1.25 billion, respectively.

Baltimore moved up to third place in the annual ranking after receiving a significant increase of $70.3 million in NIH funding. That resulted in Philadelphia dropping to fourth, with Seattle, La Jolla, Los Angeles, San Diego, Chicago and San Francisco rounding out the top 10, respectively.

Using NIH data, SSTI has crafted a table ranking the top 100 cities for FY 2004 NIH funding. The table is available at: http://www.ssti.org/Digest/Tables/022006t.htm

Cities within major metro areas are listed separately when their figures are large enough. For instance, individual rankings are provided for La Jolla and San Diego; Boston and Cambridge; the Bay area of San Francisco, Oakland and Berkeley; and Los Angeles, Pasadena, Santa Monica and Arcadia.

As seen in the top four rankings, funding levels can vary significantly between years. NIH Top 100 Cities award data for previous years can be found at:

Additional NIH awards and statistics are available at: http://grants1.nih.gov/grants/award/awardtr.htm

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Job Corner
Carolina Center for Competitive Economies Seeks Associate Director for Research
The Carolina Center for Competitive Economies (C3E) at the University of North Carolina, Chapel Hill, invites applications for the position of Associate Director for Research. In addition to overseeing research activities and helping to generate new projects, the successful candidate will have an important role in supervising graduate students in applying regional models and providing other types of technical assistance to businesses and communities. Applicants should have graduate training in economics, regional science, city planning, business, public policy or a related field and 3-5 years of experience. A Ph.D. is preferred. A complete job description is available through the SSTI Job Corner at http://www.ssti.org/posting.htm.

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People

Temi Bova is the new director of Union College's U-start technology business incubator in Schenectady, N.Y.

The Ben Franklin Technology PArtners of Central and Northern Pennsylvania promoted Stephen Brawley to serve as president and CEO.

Alan Brown was named executive director of the Pennsylvania NanoMaterials Commercialization Center, a newly formed economic development initiative.

The Wright Center of Innovation for Advanced Data Management and Analysis changed its name to daytaOhio and named Paul Cashen as its new president.

Former Lansing Community College president Paula Cunningham is the new director of the Michigan Department of Labor and Economic Growth.

Dan Curran is the new director of the Business Development Division of the Nebraska Department of Development.

Ted Ford, former president and CEO of the Edison Welding Institute, recently was named president and CEO of TECHColumbus.

Sandy Johnson, interim CEO of the Mid-American Manufacturing Technology Center, was appointed to the position on a permanent basis.

Roger Kilmer was appointed director of the Hollings Manufacturing Extension Partnership program at the National Institute of Standards and Technology. Kilmer served as acting director since Kevin Carr's departure last June.

Sean O'Kane, commissioner of the New Hampshire Department of Resources and Economic Development, is resigning from the position at the end of his two-year term in March to return to the private sector.

BioFlorida President Diana Robinson is leaving to join a private venture capital company once her replacement is selected.

Tim Rubald, interim executive director of the Nevada Commission on Economic Development, was appointed to the position on a permanent basis.

Harvard University President Lawrence Summers announced his resignation this afternoon. Former Harvard president Derek Bok is to serve as interim president for the university.

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