Effects of Budget Deficits Begin to Emerge for Some State, Local TBED Efforts

In perusing SSTI Weekly Digest articles related to approved and enacted budgets over the last several months, it is evident a majority of governors and legislators are supporting TBED initiatives through increased or maintained funds despite a bleak fiscal outlook in the coming years. However, state spending is expected to decrease over the next fiscal year and beyond. Combined with declines in state revenue and a weakening national economy, few state-supported programs and initiatives can be presumed safe from the possibility of budget cuts.

Last month, the Spring 2008 Fiscal Survey of States revealed projections of further declines in state revenue for a significant number of states, indicating that more than a quarter of states were forced to reduce their enacted budgets for fiscal year 2008, and 18 states assume negative budget growth for FY09. By comparison, only three states had to reduce their enacted budgets in FY07, the report states. Last month alone, governors in Connecticut, Florida, Hawaii, New Hampshire and New York ordered across-the-board cuts to state agencies’ current operating budgets.
 
Absorbing across-the-board cuts early in a fiscal year gives agencies a chance to reorganize priorities and, in some cases, delay new initiatives. Cuts made late in the fiscal year, however, often are painful for programs to withstand.
 
In response to New York Gov. David Patterson’s recent order to all state agencies to cut spending by 10 percent in the current fiscal year, the New York State Foundation for Science, Technology and Innovation (NYSTAR) announced a reduction in Faculty Development grants from $750,000 to $500,000. The grants are used to recruit and retain world-class scientists to New York’s academic research centers.
 
The spending plan states, “Programmatically, savings will be achieved through a combination of fewer awards and decreasing the dollar value to more succinctly target investments.” A similar approach is expected for NYSTAR’s technology transfer program. NYSTAR’s revised spending plan warns that operational reductions will decrease the state’s investment in commercialization efforts at universities and may reduce the ability to actively support collaboration through opportunities across the state.
 
In a news article published by BioRegion News, Jannette Rondo, NYSTAR communications director, said the spending cuts will not deter NYSTAR from funding key programs toward promoting science and tech development statewide.
 
NYSTAR plans to cut some administrative and operational expenses in the meantime and will pursue funding from other sources to make up some of the difference.
 
Not all cuts are felt only at the state level. In California, the University of California (UC) Davis recently announced the elimination of the InnovationAccess program – a move directly related to budget cuts, the school reports. The program, which is part of the Office of Research, was created to help researchers form technology-related companies. Services are focused on technology transfer through evaluation of patent inventions from UC Davis faculty and researchers and business development through strategic research alliances with industry and commercialization support for early-stage UC Davis technologies.
 
The program was eliminated as part of the 43 full-time and 92 vacant jobs being cut to balance the university’s budget, according to a Sacramento Business Journal article. The InnovationAccess cutback saves UC Davis a total of $428,956, the article states.