SSTI Digest

The ability of states to deliver the services promised to its residents relies on their fiscal soundness. With most states beginning their fiscal year in July, SSTI has reviewed the current fiscal standing for each state and here presents a snapshot of our findings.

Most states ended their fiscal year with a surplus and continue to recover from the Great Recession, with a growing economy and job gains. However, they face continuing demands on their budgets, with expanded Medicaid payments and the growing opioid crisis confronting nearly every state. Such decisions affect the state’s ability to fund innovation efforts, from the amount of support available for higher education and STEM programs, to funding for entrepreneurship, and forging public private partnerships to strengthen innovation programming that the private sector cannot fully support.

Our analysis found that some states that rely on the energy sector to fund their spending priorities continue to struggle, while others are already factoring in anticipated revenues as a result of new Supreme Court rulings involving gaming and online sales tax collections.

Low-income students in the Dallas County Community College District (DCCCD) will be among the first allowed to use federal student aid to enroll in programs offered by nontraditional educational providers. The providers — including coding bootcamps, online courses, and employer organizations — are partnering with accredited colleges or universities through an experimental program called Educational Quality through Innovation Partnerships (EQUIP). The U.S. Department of Education has announced that Brookhaven College is the first program to receive final approval.

May 1 marks the deadline to choose a school for students considering their college options. A new tool developed by the University of Texas system and the U.S. Census Bureau can give a real sense of what students graduating from that system can expect to earn as well as the average debt graduates carry. The tool, seekUT, reveals the average earnings from each of the majors at the different schools and branch campuses one, five and 10 years after graduation. Where there is sufficient data, the tool shows results for both in-state and national jobs.

For instance, perhaps you are curious about an engineering degree. The seekUT tool shows that graduates of UT Austin who majored in chemical engineering are earning a national median salary of $89,893 in their first year, rising to $123,591 in the 10th year. Graduates with that same degree working within the state of Texas are earning a median first-year salary of $79,504 (increasing to $128,865 in year 10). The median loan amount for the chemical engineering UT grads is $24,748.

The state budget process is winding down across the country and SSTI continues to review the final budgets for funding for innovation-based programs. This week, we found level funding for South Carolina programs including MEP and regional-based economic development efforts, while university programs in Texas are taking a hit, and in West Virginia Gov. Jim Justice refused to sign the state budget although he will allow the legislatively approved measure to become law. Unless otherwise noted, the figures below represent level funding from the previous budgets.

South Carolina

South Carolina Gov. Henry McMaster signed the state’s 2018 budget (HB 3720) that would support several tech-based economic development programs that are funded through the Department of Commerce including:

With the latest round of state of the state or budget addresses, the states’ governors focused on their states’ financial situation. Education and economic development were still on the minds of leaders in Maine, Maryland, and Texas. With this fifth installment, less than 10 governors have yet to deliver their addresses in the coming weeks or months.

Maine

Gov. Paul R. LePage began his state of the state commenting that the state’s economy and way of life “are under attack.” In his proposals to keep young people in the state and increase higher wages he focused on higher education:

“We are also reducing the cost of higher education. We have increased funding to the University of Maine System, the Maine Community College System and Maine Maritime Academy to help control tuition cost.

“We want to make it easier for young people to stay in Maine. I will once again propose funding for zero-interest loans for all higher ed students who decide to live and work in Maine.

SSTI continues to review state budget proposals as they are released, combing through them for TBED-related initiatives. This week, education and research and development programs are revealed as we examine the budget proposals from governors in Ohio, Tennessee and Texas.

Ohio

Gov. John Kasich’s $144 billion FY 2018-2019 biennial budget proposal would reduce the income tax while raising other taxes such as sales, tobacco, alcohol, and natural gas. The Governor also emphasizes making Ohio’s economy more technology-focused, according to the Dayton Business Journal.

With job growth for middle-skill level jobs slowing, the Federal Reserve Bank of Dallas and Austin-based nonprofit Center for Public Policy Priorities studied the nation’s best practices and surveyed regional workforce boards in Texas to determine how communities there are addressing the challenge. Their findings are detailed in the report, Regional Talent Pipelines: Collaborating with Industry to Build Opportunities in Texas, released last month. For a region to succeed in their workforce development efforts, the study states three tasks must be accomplished: identify growth through an industry cluster analysis, convene a sector partnership, and create and strengthen career pathways.

On September 2, Texas Gov. Greg Abbott announced $7.2 million in funding for the newly established Texas Industry Cluster Innovative Academies. An element of Gov. Abbott’s Tri-Agency Workforce Initiative established in March 2016, the initiative will provide competitive grant funding to establish Innovative Academies within Texas high schools to provide students with learning opportunities in high-demand occupations while earning college course credit prior to high school graduation. The academies will target specific course work and educational opportunities that lead to direct employment in high-demand occupations for Texas’ key industry clusters:

Over the last month, the Economic Development Administration (EDA) announced over $8 million in grants to expand entrepreneurial and business support services in Alabama, New York, and Texas including:

While the recent Job Openings and Labor Turnover Survey (JOLTS) has some economists concerned that the U.S. economy is running out of qualified workers to fill existing openings, several states have announced workforce programs that are intended to address the skills-gap and build the talent pipeline in their respective states. These programs are intended to build regional partnerships between local workforce development agencies, economic development agencies, industry, and others. Approaches include a statewide apprenticeship tax credit in Alabama; occupation training for high-demand occupations in Texas; and, incumbent workforce training in Virginia.

Texas Gov. Greg Abbott has signed legislation that (SB 632) establishes a new Governor's University Research Initiative and ends the state's Emerging Technology Fund (ETF). Created in 2004, the ETF provided financial support for research partnerships at private companies and state universities through equity investments and grants. The new initiative will not take equity in companies, but instead will focus on university research and commercialization grants. A portion of the funds will be used to fund the recruitment of Nobel Prize-winning researchers and members of the National Academies. The approved FY 2016-17 budget allocates $40 million of the ETF's remaining funds for the initiative. Read the governor's announcement...

SSTI's Tech Talkin' Govs series has returned as governors across the country formally convene 2015 legislative sessions. The series highlights new and expanded TBED proposals from governors' State of the State, Budget and Inaugural addresses.

The final installment of this year’s series includes excerpts from speeches delivered in Alabama, Florida, Ohio, Pennsylvania and Texas. Read the first, second, third, fourth and fifth installments of this year’s series.