Federal R&D Shows Real Dollar Drop
Whichever version of the H.R. 1, the American Recovery and
Reinvestment Act (ARRA), emerges from conference committee would
provide a significant reversal to the direction spending has gone
for the past four years for federal research and development, based
on data released by the National Science Foundation during the past
week. From FY 2005 through FY 2008, federal R&D
obligations decreased 7.8 percent in constant dollars. Between FY07
and FY08 alone, total federal R&D spending dropped $3.5 billion
or 4.8 percent of the $116.7 billion total in FY07 once adjusted
for inflation.
In constant 2000 dollars, projected obligations for FY08 approximate the FY03 spending levels. Potentially more troubling for sustaining the nation’s innovation edge are the disproportionate drops in basic and applied research versus development. Basic research spending in constant dollars has not been as low as FY08 levels since FY2002; applied research levels set innovation back to 2001.
Federal investment in R&D plant for each of the three fiscal years 2006, 2007, and 2008 are the three lowest years of investment, in constant dollars, since at least 1990, the earliest year presented in the NSF issue brief.
ARRA would provide what could be a one-time reversal of these trends if the increases are not sustained in the final FY09 budget or in the Obama Administration’s first budget request, which will be for FY10.
The NSF Issue Brief, FY 2008 Data Show Downward Trend in Federal R&D Funding (NSF 09-309), also breaks down spending trends by agency for the three most recent fiscal years. The report is available online at: http://www.nsf.gov/statistics/infbrief/nsf09309/?govDel=USNSF_178.
return to the top of the pageSSTI Co-Hosts TIP-MEP Regional Meeting on March 12
On March 12 from 1:00-5:00 p.m. in San Francisco, SSTI is co-hosting a meeting with officials from the Technology Innovation Program (TIP) and the Manufacturing Extension Partnership (MEP) that we would encourage you or one of your colleagues to attend. TIP and MEP are two of the most market-driven programs operated by the federal government. Both programs have launched new investments and innovative services in the last year. The meeting will give you a chance to learn about:
Who should attend?
To register for the meeting, please go to: http://www.ssti.org/tipreg/tipreg.htm
The meeting will be held at:
JW Marriott San Francisco
500 Post Street (corner of Post and Mason)
San Francisco, CA 94102
415.771.8600
alternate reservation number 800.228.9290
A small room block is being held at the government rate of $164/night. Rooms must be booked by Feb. 18 to get the rate, which will be honored up to three days pre/post event depending on availability. Call the hotel at 415.771.8600 to book your room; ask for the State Science & Technology Institute - TIP/MEP meeting block.
return to the top of the pageAs the U.S. Congress is ironing out the details of the stimulus package, the final share of science and technology investments within the bill is not known at this time. However outside of the U.S., other countries have recently announced their own proposals to improve the research and innovation infrastructure of their countries.
In China Premier Wen Jiabao announced last month an acceleration of 600 billion yuan ($88 billion) in spending toward 16 planned major projects in science and technology, designed to accomplish short-term stimulus and long-term economic goals. The projects were outlined two years ago in “National Guidelines for Medium- and Long-term Plans for Science and Technology Development,” which specified China’s investment strategies from 2006 to 2020. , These 16 projects include the development of large aircraft, advanced integrated circuits, wireless technology, energy extraction, high-end machinery, software systems, novel medicines and water treatment, according to the Wall Street Journal and Chinese Ministry of Science and Technology.
In November, China announced a 4 trillion yuan ($580 billion) general stimulus package. The first tranche of 100 billion yuan was allocated toward the end of 2008, and last week Chinese state media announced the government will begin investing a second allocation of 130 billion yuan ($19 billion).
Last week, the Korea Communications Commission (KCC) announced its intentions to invest 34.1 trillion won ($24.6 billion) over the next five years to improve high-speed internet to 1 Gbps and wireless broadband to 10 Mbps throughout South Korea. The KCC claims this action will increase broadband speed 10 times over its current speed by 2012, and create 120,000 jobs in the process. The Korean government will provide four percent of the total, with the rest coming from private telecommunication companies. In January, South Korea’s Ministry of Knowledge Economy announced its five-year innovation plan, which strives to push total R&D intensity to 5.0 percent of GDP in 2013, from 3.4 percent in 2007.
On a smaller scale, the government of Singapore allocated $48 million last month to support 100 doctoral students at the Singapore-MIT Alliance for Research and Technology (SMART). SMART is a research entity created between the Massachusetts Institute of Technology and Singapore’s National Research Foundation (NRF), and its research programs are housed within Singapore’s Campus for Research Excellence and Technological Enterprise (CREATE), intended to be an “innovation hub” for future development in the country.
return to the top of the pageWisconsin Governor Proposes Investor Tax Credit Expansion, Funds for Advanced Workforce Training
Gov. Jim Doyle unveiled today an economic stimulus plan for
Wisconsin that includes a proposal to enhance tax credits for angel
and venture investors in support of start-up technology companies.
A coalition assembled to improve Wisconsin’s existing
investor tax credits law applauded the governor’s
announcement to refine the four-year-old program.
The Wisconsin Growth Capital Coalition, which is comprised of nearly 30 public/private TBED organizations and investment funds, have suggested specific improvements in Wisconsin’s investor tax credits law to encourage angel and venture capitalists to invest in qualified early-stage deals.
Wisconsin’s investor tax credits law, sometimes known as the Act 255 tax credit law, currently grants 25 percent credits spread over two years. The program is credited with helping to nearly triple early-stage investments by angel investors and venture capitalists in Wisconsin companies since its enactment.
In 2007, early-stage investments in Wisconsin reached $147 million, according to a report by the Wisconsin Angel Network, which found the dollars spread over scores of deals in high-growth businesses ranging from advanced manufacturing to biotechnology to information technology.
The changes proposed in the state stimulus package would expand credits available to angel investors to $18.25 million and $18.75 million for venture investors, essentially tripling the current aggregate total of $11.5 million per year. The credits would be transferable by investors within certain parameters set by the state and could be applied against premium and franchise taxes paid by insurance companies. Additionally, the legislation seeks to:
Members of the coalition believe improvements in Wisconsin’s investor tax credits law would continue the recent growth of the state’s high-growth, early stage sector and better position companies in that sector to attract investment from investors within and outside Wisconsin.
To help jump-start the state’s economy, the proposed stimulus plan would provide additional funding of $1 million to increase Workforce Advancement Training Grants awarded by the Wisconsin Technical College System. The additional funds would be allocated for advanced manufacturing skills and training. Also, the plan calls for expanding access to capital for scientific, medical and technological research by allowing the Wisconsin Health and Educational Facilities Authority to issue federal tax-free bonds to finance projects and outstanding debt related to research facilities.
View the governor’s letter to the legislature: http://www.wisgov.state.wi.us/docview.asp?docid=15919
return to the top of the pageConnecticut Gov Latest to Propose Consolidating Economic
Development Efforts
Adding to a growing number of governors proposing to consolidate
state economic development agencies, Gov. Jodi Rell last week
announced in her budget request her intention to overhaul
Connecticut’s job creation infrastructure by merging several
state agencies into the Department of Economic and Community
Development (DECD). In recent months, governors in New York and
Kansas, for example, have touted cost savings, streamlining
government services, and creating a more efficient system to assist
in business development and job creation as reasons for the
proposed mergers. However, in two cases, critics have argued
the consolidations would lead to a loss of key programs serving the
TBED community (see the Jan. 21, 2009
and the Dec. 17,
2008 issues of the Digest).
Under Gov. Rell’s proposal, the state’s two primary financing agencies, Connecticut Innovations, a 20-year-old quasi-public agency that provides venture capital to high-tech start-up companies, and the Connecticut Development Authority would be combined to form a new Connecticut Economic Innovations Authority. DECD would oversee the state’s Small Business Innovation Research (SBIR) outreach program and the tourism, film and art programs currently led by the Connecticut Commission on Culture and Tourism. The governor’s budget proposal merges or eliminates a total of 23 agencies and commissions, reports The Bond Buyer.
The newly structured DECD would receive $92.6 million in the governor’s 2010-11 biennial budget. Funding for several TBED initiatives administered by the agency would be slightly reduced from the funding levels approved in the 2008-09 budget (see the July 11, 2007 issue of the Digest). This includes:
Funding for the Connecticut Center for Advanced Technology Manufacturing Supply Chain is eliminated in the governor’s budget request ($750,000 each fiscal year). This program was established by 2005 to promote supply chain development and integration and to stimulate process improvement at small- and medium-sized manufacturers in the aerospace and defense sector.
To bridge the gap between high school and higher education, Gov. Rell wants to merge the vo-tech high school and community college systems within the state’s Office of Workforce Competitiveness and create the Middle College System. Her proposal would allow high school students to earn up to 49 college credits by the time they enter college. Students would be able to take up to two courses per semester beginning in 10th grade that earn college credit and count toward high school graduation. The budget request includes $304.65 million in FY10 and $309.6 million in FY11 for the effort.
Earlier this month, Gov. Rell signed Executive Order No. 23, establishing guidelines to train and develop the state’s green collar workforce. The order calls for reallocation of funds for existing job training to the new 21st Century Green Jobs Training Initiative in addition to the following directives:
Connecticut is facing a projected $6 billion deficit over the next two years. View Gov. Jodi Rell’s 2010-11 budget proposal at: http://www.ct.gov/governorrell/cwp/view.asp?a=1317&Q=433326.
return to the top of the pageUseful Stats
Gross Domestic Product by Metro, Per Capita GDP by Metro
2002-2006
According to the most recent release of gross domestic product
(GDP) by metro area, 23 of the nation’s 363 metro areas
experienced a decrease in inflation-adjusted GDP from 2002 to 2006.
Benchmarking against the aggregate U.S. metro GDP growth rate over
those five years – which increased 12.8 percent – 167
of the nation’s metros grew at a faster rate.
On a per-capita GDP basis however, the wealth was more concentrated as only 61 (about one-sixth) of metros had an average per-capita GDP higher than the U.S. metro average of $41,510. Topping the list of metros in per-capita GDP were the regions concentrated around Bridgeport, CT ($78,944 per person); San Jose, CA ($76,290); Charlotte, NC ($63,668); San Francisco/Oakland, CA ($61,895); and the District of Columbia ($60,757).
From 2002 to 2006, the per-capita GDP across all U.S. metros increased by 8.2 percent. Of the 363 metros, 157 bested this increase. Only 40 of the metros witnessed a per-capita GDP decrease over this period.
So where does your metro stand?
SSTI has prepared a table listing not only the 2006 GDP for every U.S. metro area in current dollars, but the 2006 per-capita GDP values, as well as the percent change and relative ranking of these values from 2002 to 2006. The data originates from the Bureau of Economic Analysis (BEA).
The GDPs cover a wide range on this chart, from $1.12 trillion for the New York City metro region to $1.42 billion in Palm Coast, Florida – about a factor of one thousand. Because of this, it may help to break up this list into three size categories: metros with less than $10 billion GDP, metros with more than $100 billion in GDP, and all other metros in between.
For the 202 metro areas with a GDP less than $10 billion in 2006, the metro around Corvalis, OR saw a per-capita GDP increase of 38.7 percent to $48,709. Longview, TX and Punta Gorda, FL were also at the top in this category. For the 135 metros between $10-100 billion in GDP, Lake Charles, LA led the pack with a 31.9 percent increase to $48,722. The metros around New Orleans, LA and Peoria, IL were also in the top of this group.
Finally, for the 26 metros with a GDP larger than $100 billion, San Jose’s per-capita GDP grew by 18.7 percent over the five-year time period. The only other metros in this group with a per-capita GDP growing more than 15 percent were Portland, San Diego, Los Angeles, and Miami.
SSTI's table is available at: http://www.ssti.org/Digest/Tables/0211097t.htm
The BEA data back to 2001 can be found at: http://www.bea.gov/regional/gdpmetro/
return to the top of the pageSSTI Job Corner
The complete description of this opportunity and others are
available at http://www.ssti.org/posting.htm.
The National Business Incubation Association, (NBIA) the world's leading organization advancing business incubation and entrepreneurship, has retained ELF Associates to recruit a Chief Executive Officer. The CEO will be responsible for the accomplishment of the organizational and programmatic goals and objectives including Board governance and support; executive leadership and management; program management; external relations, financial management; human resource management; information management and administrative operations; and marketing/member relations. A bachelor’s degree and familiarity with the industry are required. A minimum of 5-10 years of professional management and leadership experience in the business incubation industry is preferred.
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