SSTI Digest

Despite a small decrease in venture capital deals last year, the San Francisco-Oakland-Fremont metropolitan area remains the most active investment regions on a per capita basis, according to data from the PricewaterhouseCoopers (PwC)/National Venture Capital Association (NVCA) MoneyTree Report. San Francisco led all other MSAs in both total dollars and per capita activity, with its $21 billion in 2015 investment averaging about $4,500 per metro resident. NVCA notes that 133 metros were home to deals in 2015, an encouraging sign that opportunities are opening up in areas outside of the known hotspots.

San Francisco continues to be the U.S. VC metro by a large margin, but several other areas stand out from the pack. In San Jose- Sunnyvale-Santa Clara, the per capita average was around $3,200 per resident, and in third-ranked Boston, that figure was around $1,200. No other cities achieved per capita average over $1,000, though on a total dollars basis, New York and Los Angeles had similar levels of activity to San Jose and Boston.

State economic development policies that focus on deep income tax cuts or tax breaks to lure companies from other states ignore fundamental data points about job creation, and as a result are more likely to fail, according to a recently released report from the Center on Budget and Policy Priorities. While alluding to the importance of encouraging entrepreneurship and firm survival more broadly, the authors also argue that public investments should be targeted at helping build a skilled workforce and improve the quality of life for residents.

Written by Michael Mazerov and Michael Leachman, two researchers from the Center on Budget and Policy Priorities, State Job Creation Strategies Often Off Base uses data from new databases developed by the federal government to track the job-creation record of specific businesses of various sizes and ages over time to shape their argument. The authors use this data to detail two fundamental points about job creation that are critical to their argument.

The U.S. Department of Energy’s (DOE) Office of Technology Transitions (OTT) announced that it will commit up to $20 million for the first round of the DOE’s Technology Commercialization Fund (TCF) – a matching fund that helps bring promising energy technologies developed at DOE-funded national laboratories to market. In addition to helping advance promising energy related technologies with commercial potential, the TFC is intended to strengthen partnerships between the national labs and private-sector companies that can deploy energy technologies to the marketplace.

Enacted FY16 funding levels are used for comparisons unless otherwise noted.
The administration’s FY17 budget request for the Department of Health and Human Services (HHS) is $82.8 billion in discretionary spending, reflecting a 0.8 percent decrease from FY16 enacted funding levels. Discretionary spending accounts for only 7.5 percent of the total proposed HHS budget. Mandatory spending for programs like Medicare, Medicaid and the Children’s Health Insurance Program account for the balance. Total FY17 budget authority for HHS would be $1.2 trillion (3 percent increase over FY16 enacted).  

Enacted FY16 funding is used for comparisons, unless otherwise noted.
The president’s FY17 proposed budget would allocate $69.4 billion in discretionary funding (1.6 percent increase) for the Department of Education. Priority areas addressed in the budget proposal include increasing equity and excellence in education, providing additional support for teachers and school leaders, and expanding access, affordability, and completion in higher education.  

To support high-quality early learning, the president’s proposed budget includes $1.3 billion in mandatory funding to launch the 10-year, $75 billion Preschool for All program, which guarantees universal preschool access to every 4-year-old from low- and moderate-income families and creates incentives for states to serve additional children from middle-class families. The most notable of the president’s proposed funds for higher education are around the America’s College Promise Initiative, which would allocate $1.3 billion in FY17 to support 2 years of community college free for responsible students.

Estimated FY16 funding levels are used for NSF comparisons, unless otherwise noted.

The president’s FY17 budget proposal for the National Science Foundation (NSF) would provide $7.6 billion (1.2 percent increase) in discretionary funding in addition to $400 million in new mandatory funding. Of that amount, $6.1 billion (0.8 percent increase) would be designated for research and related activities, $193.1 million (3.6 percent decrease) for R&D facilities and equipment, and $898.9 million (2.1 percent increase) for education and training. The president’s budget proposes 11 priority goals to:

Enacted FY16 funding is used for comparisons unless otherwise noted.
The president’s FY17 budget proposal would provide $12.8 billion in discretionary funding for the Department of Labor (DOL), a 4.9 percent increase from FY16. Priority items supported in the budget are apprenticeships, career navigation tools, and additional reforms recommended in the Workforce Innovation and Opportunity Act (WIOA).

Under the proposed FY17 budget, WIOA Formula Grants to states and localities providing training and employment services would be funded at $2.8 billion (5 percent increase), the first time since the law’s enactment that these grants would be funded at their full authorized level.

FY16 enacted funding is used for NASA comparisons, unless otherwise noted.
Under the president’s FY17 budget request, NASA would receive $19 billion (1.6 percent decrease). For a number of programs, FY16 comparisons are unavailable because NASA’s FY16 operation plan has not been finalized. Priority items in the NASA budget include the development of technologies that make future space programs more affordable and capable, continued support for the Webb Telescope, and developments to catalyze growth in the American commercial space industry.

The proposed budget would allocate $5.6 billion (0.2 percent increase) for NASA’s Science Mission Directorate, which supports research science, invests in advanced technologies, supports over 90 space missions, and maintains partnerships with a dozen other federal agencies and 60 other nations. Funding would include:

Enacted FY16 funding levels are used for comparisons unless otherwise noted.
Small Business Administration (SBA) funding in the president’s FY17 budget request totals $719 million (1 percent increase), excluding Stafford Act Disaster Funding. Within that total, $230.6 million (level funding) is provided for counseling and technical assistance for entrepreneurs. Another $152.7 million (level funding) is provided for SBA’s loan programs. In FY16, the agency’s 504 loan guarantee program became zero subsidy, eliminating a larger portion of the appropriation for SBA’s business loan programs, but not impacting programmatic activities in FY17.

SBA would administer $46 billion through its now-zero subsidy loan programs. Credit programs include:

The president’s FY17 budget proposal includes requests for four regional commissions, which work to develop the economies of economically distressed regions. 

Estimated FY16 funding is used for comparisons unless otherwise noted.
The president’s FY17 budget request for the Department of Housing and Urban Development (HUD) is $48.9 billion, a 4 percent increase. Priority funding items within HUD include rental housing assistance, ending homelessness, supporting tribal communities, and improving mobility for low-income families.

The Community Development Fund, which includes the Community Development Block Program, would receive $6.8 billion (5 percent decrease). Of this amount, $2.8 billion (20 percent decrease) would go to community development formula grants that assist state and local governments in addressing community and economic development activities.

Enacted FY16 funding is used for comparisons unless otherwise noted.
The president’s FY17 budget request of $8.3 billion for the Environmental Protection Agency (EPA) reflects a 1.6 percent increase from the FY16 enacted budget. The main priority goals identified by the agency are to: reduce greenhouse gas emissions from cars and trucks; advance resilience in the nation’s water infrastructure; clean up contaminated sites to enhance the livability and economic vitality of communities; assess and reduce risks posed by chemicals; and, strengthen environmental protection through business process improvements.

Science and Technology programs under the EPA would receive $754.2 million, an increase of 2.7 percent. Areas of EPA research that would receive funding under the proposed budget include: