In the September 26, 2007 Issue:

Copyright State Science & Technology Institute 2007. 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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Technology Administration to be Shuttered This Weekend
Congress may be able to use a Continuing Resolution to keep most of the federal government open after the fiscal year ends Sept. 30, but the Technology Administration (TA) will be closing forever this Sunday.
 
TA was established by the Stevenson-Wydler Act of 1980 to “conduct technology policy analyses to improve United States industrial productivity, technology, and innovation, and cooperate with United States industry in the improvement of its productivity, technology, and ability to compete successfully in world markets.” Besides this duty, TA was also originally charged with assisting with the implementation of the Metric Conversion Act of 1975, monitoring Japanese scientific innovations, and overseeing the collection and translation of Japanese technical reports and documents, among others.
 
The budget for TA has fallen over the years, with $6 million allocated for fiscal year 2006 and $1.6 million in FY 2007. The budget request for the 2008 fiscal year, which begins on Oct. 1, 2007, includes marginal funding for personnel and other costs associated with terminating the agency. The policy activities for which TA is presently responsible will be moved to the Secretary’s office.
 
TA has served as an administrative unit within the U.S. Department of Commerce overseeing the National Institute of Standards and Technology (NIST), the National Technical Information Service (NTIS) and the Office of Technology Policy (OTP). NIST and NTIS will be stand-alone units within the Commerce Department. For OTP, however, instead of a maintaining separate office, a senior advisor within the Commerce Department will now chair a department-wide council to manage technology policy for the Department.
 
While small in size, distinct offices for TA and OTP served to coordinate technology policy for the executive branch. OTP objectives and activities over the years have aligned with supporting broader state and regional TBED policy development as well. For several years, it maintained a small pool of funds to support TBED relevant research and projects, including the short-lived but popular Experimental Program to Stimulate Competitive Technology (EPSCoT) pilot program.
 
TA has produced a number of reports over the years on such subjects as technology transfer at federal laboratories, business incubator performance, science and technology indicators, Japanese patent law, and advanced technologies such as fuel cells and biotechnology. More than 50 of them are currently available for free download at www.technology.gov/reports.htm. It is unknown at the present time how long these reports will be available after Sept. 30.
 
In addition, OTP provided a small grant to SSTI to fund the creation of the TBED Resource Center, an online library of links to more than 4,600 reports, papers, strategic plans and studies relevant to TBED and science and technology policy and program delivery. The TBED Resource Center is accessible through www.tbedresourcecenter.org.

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Return of Federal Earmarks Aids Some TBED Efforts
Fans of sound public policy may have celebrated last year’s complete elimination of congressional earmarks on the FY 2007 budget. With the rapid growth over the past decade in the percent of discretionary federal spending arriving with strings attached, the idea there would be no more multi-million-dollar bridges to nowhere, indoor rainforests on the great plains and other gems seemed too good to be true. And it was, apparently, as draft FY08 budget bills surfacing in both chambers reveal.
 
The plus side of earmarks, besides keeping a small army of lobbyists employed, is that sometimes they can provide funds to support research and TBED initiatives. For example, following is an overview of recent federal earmarks from across the nation that were included in the Transportation, Housing and Urban Development Appropriations bill. Whether or not the bill actually passes the full Congress before late winter or next spring remains to be seen.
 
Alabama
Sen. Richard Selby (R-AL) announced funding for several projects included in the Safe, Accountable, Flexible and Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU), the Highway and Transit Reauthorization Bill. The Cummings Research Park Intermodal Center is slated to receive $1.3 million to construct an Intermodal facility in the research park. Additionally, $500,000 is earmarked for University of Alabama Huntsville (UAH) transportation, infrastructure and logistics research. Funds will be used to enhance UAH’s office of Transportation, Infrastructure and Logistics work on assessing and improving transportation logistics in the state.
 
Arkansas
Senators Blanche Lincoln (D-AR) and Mark Pryor (D-AR) announced a proposed $600,000 appropriation to the University of Arkansas at Pine Bluff for completion of the business support incubator. Funding will assist the Economic Research and Development Center in completing Phase II of the business support incubator project, a 16,000-square-foot building that houses offices for the Economic Research and Development Center.
 
Kansas
Sen. Sam Brownback (R-KS) announced proposed funding for the National Institute for Aviation Research at Wichita State University, including $2 million for advanced materials research and $1 million for small aircraft aging research.
 
Michigan
Senators Debbie Stabenow (D-MI) and Carl Levin (D-MI) announced a $4 million appropriation for Flint Mass Transportation Authority (MTA) for bus and bus facility enhancements. MTA is partnering with Kettering University and Michigan State University to use hybrid and fuel cell technologies in their bus fleet. Additional earmarks within the Appropriations bill include $1 million for Pinnacle Aeropark, a 1,300-acre mixed-use business development park and $200,000 for renovations at TechTown to redevelop a distressed community and create a training and business technology incubator.
 
North Dakota
Sen. Byron Dorgan (D-ND) announced funding for several projects included in the Appropriations bill, including $4.5 million for a precision manufacturing facility to provide specifically fabricated parts to Army units in the U.S. and $3.5 million for Universal Description, Discovery and Integration, a project that will allow Minot’s InfoTech to provide for the first time a single web-based location where the Department of Defense can access military databases around the world, while still protecting sensitive data.

University of North Dakota’s (UND) Center of Excellence for Defense UAV Education is slated to receive $4 million to support research that will help improve the nation’s unmanned aircraft systems. Also included is $2 million for UND’s Energy and Environmental Research Center to develop new types of cleaner, more efficient fuels for the U.S. military. Researchers will work to develop a system to produce hydrogen fuel and an assortment of liquid fuels that are produced from coal and biomass.
 
More than $18 million is included for various technology development projects at North Dakota State University.

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Private Funding Gives Washington Life Sciences Discovery Fund Early Boost
With the first round of state funding not expected until April 2008, private foundations have stepped in to provide a jumpstart for the Life Sciences Discovery Fund (LSDF). Last week, six Washington-based research teams were awarded more than $4.5 million in private funding to support projects that improve health care quality and capitalize on economic development opportunities within the state.
 
Created in 2005, LSDF is a state agency that operates like a foundation, authorized to use $350 million in tobacco settlement funds over a 10-year period to support life science research (see the May 16, 2005 issue of the Digest). When leveraged with federal sources and private investment, the fund’s total impact is expected to exceed $1 billion.
 
Selected projects for the first round of funding will focus on innovative applications of technology to improve effectiveness of surgical procedures, to improve management for all patients, and to better diagnose and treat certain diseases. Major contributors include the Bill & Melinda Gates Foundation, the Paul G. Allen Family Foundation, Microsoft, Amgen, Safeco, and Regence BlueShield.
 
A press release is available at: http://www.lsdfa.org/about/news/Press_release_07-01_awards_final.pdf

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Report Says LAX Key in Attracting Corporate HQs to Southern California
Last year, nearly 17 million international passengers passed through Los Angeles International Airport (LAX). Many of those passengers were businesspeople who rely on convenient access to international flights to keep their companies in touch with partners, customers, divisions and markets all over the world. International flights out of LAX have played a key role in positioning the Los Angeles region as the largest manufacturing center in the U.S. and as a national high-tech leader. In fact, a recent report from the Los Angeles Economic Development Corporation (LAEDC) estimates that an average daily transoceanic flight out of LAX sustains 3,120 direct and indirect jobs, generates $156 million in wages, and adds $623 million to the region's economic output.
 
That same report, however, finds that Los Angeles' competitive advantage in access to international flights is now in danger of disappearing, as other large airports expand their overseas offerings and a handful of up-and-coming international gateways begin to offer daily international flights. Between 2000 and 2006, LAX - the country's second largest international gateway - experienced a decline of 8 percent in international passengers. Meanwhile, expanding gateways in Charlotte, Las Vegas, Phoenix and Denver all expanded by at least 50 percent and other larger airports, such as Washington Dulles, Houston and Atlanta, posted significant gains.
 
The threat of these competitors could have dramatic economic consequences for the Los Angeles region, the authors contend. Transoceanic flights are becoming increasingly important to companies operating in the international marketplace. Global companies want direct flights between their corporate headquarters and emerging markets in India, China, Europe and Israel. The LAEDC report observes that many airports are now competing for direct flights to these markets in order to cater to the needs of global businesses travelers without requiring extended layovers. These flights play a particularly important role in serving corporate headquarters where executives frequently rely on them.
 
To put this all in perspective, a 2005 study by Germa Bel and Xavier Fageda in Public Economics reported that a 10 percent increase in the supply of intercontinental flights can lead to a 4 percent increase in the number of headquarter of large firms located in the surrounding urban area. Bel and Fageda's analysis of European airports and corporate headquarters also found that knowledge-intensive sectors were much more affected by the presence or absence of these flights. A separate study by Vanessa Strauss-Kahn and Xavier Vives, published last year, examined the decision of U.S. companies to relocate their headquarters between 1996 and 2001. The authors found that access to high-quality airport facilities, including international flights, was one of the most important factors in determining whether or not a company moved and where that move took them.
 
The benefits of convenient international passenger flights extend beyond the passengers themselves. More than half of all air cargo is transported in the cargo hold of passenger aircraft. LAEDC points out those industries that depend on LAX flights to ship their goods overseas are often involved in high-tech manufacturing, such as electronics and bio-medical instrument companies, and that proximity to international flights is a significant boon for regional exports.
 
The LAEDC report recommends that LAX facilities be upgraded to accommodate the latest generation of passenger planes, including the Airbus A-380 and the Boeing B-787. This will help the airport and the economy remain competitive against smaller-but-expanding airports. Given current market trends, the group estimates that LAX could add 11 new daily nonstop international flights by 2011, and these flights could generate as many as 34,000 new jobs and $1.7 million in new wages within the Los Angeles region.
 
Download "The Economic Activity Dependent on Overseas Flights at LAX" at: http://www.laedc.org/consulting/projects/2007_LAX_OverseasFlights.pdf
 
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Lott Center, SSTI Announce Dr. Edward Feser as Winner of the Lott Center Excellence in Technology Based Economic Development Research Award
The Trent Lott National Center of Excellence for Economic Development & Entrepreneurship is pleased to announce its inaugural Excellence in Technology Based Economic Development Research award will be made to Dr. Edward Feser on Oct. 19, 2007, at the SSTI 11th Annual Conference in Baltimore.
 
The Lott Center award recognizes outstanding research contributions to Technology Based Economic Development (TBED) which help economic development practitioners and policymakers grow their regions economies through the recruitment, expansion and start-up of high tech enterprises.
 
Dr. Feser’s research has reshaped the way in which TBED practitioners and policymakers take action and offers new pathways for future action. Areas of specialization include industry clustering, industry cluster analysis methods, agglomeration economies and industrial productivity, migration and regional economic distress, regional influences on process technology adoption in manufacturing, and the improvement of data and spatial-analytical techniques for local development practice. Currently, he is studying economic development policymaking processes and the role that universities can play in assisting states and regions undertake strategic economic development planning.
 
Dr. Feser is professor and interim head of Urban and Regional Planning at the University of Illinois Urbana Champaign (UIUC). He taught at the University of North Carolina at Chapel Hill for seven years prior to coming to UIUC in 2004. In 2003, he served as assistant secretary of the North Carolina Department of Commerce, where he acted as chief economist and senior policy advisor to the Secretary and directed the reorganization and expansion of the agency's Division of Policy, Research and Strategic Planning. He continues to work closely with state and local governments on issues related to his research and acts regularly as a consultant to the corporate sector, government, nonprofit development agencies, and economic development planning firms.
 
The Trent Lott National Center of Excellence for Economic Development & Entrepreneurship is operated by the University of Southern Mississippi. The Lott Center promotes global research on innovation based economic development, provides innovation based economic development education across the U.S., implements innovation programs in South Mississippi and infuses entrepreneurship within the university.
 
SSTI is a national nonprofit organization that leads, supports and strengthens efforts to improve state and regional economies through science, technology, and innovation.

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Useful Stats
Five-year Change in GDP by U.S. Metro Area
According to the first-ever release of gross domestic product (GDP) estimates by metro area, 327 of the nation's 363 metro areas enjoyed growth in real GDP in 2005. Only 133 of the areas accelerated faster than inflation, however. The one-year percent change in 2005 GDP for metro areas ranged from 19.4 percent in Palm Coast, Fla., to -5.4 percent in New Orleans. Real GDP declined in 36 metro areas.

The Bureau of Economic Analysis (BEA) made the experimental but potentially valuable statistics available to the public to receive broad evaluation and comment by users. All told, metropolitan areas of the country account for 90 percent of the nation's total GDP. That figure is heavily skewed toward the largest areas, however -- the top 5 metro areas account for 23 percent of the U.S. total, while the smallest 75 areas make up less than 2 percent of U.S. GDP. At $1.1 trillion, the New York metro area would be the second state behind California's $1.6 trillion figure and the 10th largest country. The 2005 total GDP for the U.S. is $12.4 trillion.

The Sept. 26 BEA press release includes a table presenting annual GDP estimates in chained 2001 dollars for all 363 metro areas for 2001-2005. In addition, it provides annual percent changes and rank for 2004-2005 percent change. The data is also downloadable from the BEA website.

To complement the BEA table, SSTI has prepared a table presenting the same data with ranking for the percent change for the full five-year period. Palm Coast tops the list with a commanding 163.81 percent change, far outdistancing the 56.91 percent change experienced by second place Corvalis, Ore. The balance of the top 10 were:

SSTI's table is available at: http://www.ssti.org/Digest/Tables/092607t.htm

The BEA press release is available at: http://www.bea.gov/newsreleases/regional/gdp_metro/gdp_metro_newsrelease.htm

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New SSTI Conference Hotel Information
Early registration is nearly over and the conference hotel is full, but you still have the opportunity to join representatives from 47 states and Canadian provinces at SSTI's 11th Annual Conference in Baltimore, Oct. 18-19, 2007 -- the nation's premier gathering for the tech-based economic development field.

SSTI conference registrants can book rooms at the Hampton Inn & Suites Baltimore Inner Harbor Hotel. This hotel is located just 1.5 blocks from the Renaissance Baltimore Harborplace Hotel, the site of this year's conference. Spacious rooms with large windows and 9-foot ceilings, complimented with rich Mahogany furniture, are available.

To get the contract rate of $199 plus tax, please call the Hampton Inn & Suites at 410-539-7888 and mention you are part of the State Science and Tech Institute Block. The deadline is the end of day Thursday, Sept. 27.

A Google map to the hotel is available by clicking here. The hotel can be reached at:

Hampton Inn & Suites Baltimore Inner Harbor
131 East Redwood Street
Baltimore, MD 21202
Phone: 1-410-539-7888
http://www.baltimorehamptoninn.com/

As a reminder, SSTI's annual conference will be held on the fifth floor of the Renaissance Baltimore Harborplace Hotel. Visit www.ssticonference.org or call SSTI directly at 614.901.1690 for more information and to register.

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