SSTI Digest

Following a lively debate over education funding, state worker pay and pensions, Maryland legislators approved a $40 billion budget. Under the approved legislation, $68 million would be available to support the state's most expensive school districts. Gov. Larry Hogan, however, had favored using those funds, and an additional $132 million, to shore up the state's pension fund, according to the Washington Post. Gov. Hogan will not be able to spend these funds for any other purpose than that approved by the legislature, but has expressed an interest in letting the funds go unspent. The approved budget provides $3.8 million for the Office of Business Development, $3 million for Maryland's Office of Strategic Industries and Innovation, and $1.8 million for the Small Business Development Financing Authority. The $19 million set aside for programs under the Maryland Technology Development Corporation includes $9.4 million for the Maryland Stem Cell Research Fund, $3.6 million for Technology Development, Transfer and Commercialization, $4.9 million for the Maryland Innovation Initiative, and $1 million for the Cybersecurity Investment Fund. The budget…

Even after equity crowdfunding reached a milestone earlier this month with new Securities Exchange Commission proposed rule changes, state legislatures across the country continue to pass intrastate crowdfunding bills. In April, governors from Arizona (HB 2591) and Colorado (HB 1246) signed bills that will allow startups and other businesses in their respective states to raise capital via equity crowdfunding exemptions. Arizona and Colorado joined Massachusetts (Read more in the SSTI Digest) as states that have passed exemptions since the start of the year. The next state most likely to pass crowdfunding legislation is Minnesota – once they are able to finalize compromise between lawmakers and state regulators. In March, new legislation (HB 3429) was officially filed by Illinois State Rep. Carol Senate. The North Carolina state legislature once again is attempting to pass intrastate crowdfunding legislation. 

The Illinois Accelerator Research Center (IARC) is a new research facility for scientists and engineers from Fermilab, Argonne, and Illinois universities to work alongside industrial partners to develop breakthroughs in accelerator science and apply them to areas such as computing, health, industry, and homeland security. Using electromagnetic fields to propel charged particles at high speeds and to contain them in well-defined beams, accelerator technology allows for the investigation of many aspects of particle physics and application in a variety of industries. As an economic development tool, the IARC intends to attract private industry partners to create new high-tech jobs, while simultaneously providing state-of-the-art training and education to researchers and practitioners. The facility also provides Fermilab with an increased opportunity to pursue future proposed particle accelerators, placing Illinois in a position to become a world leader in accelerator research, development, and industrialization, according to the IARC website. On Tuesday, April 28, 2015, the Fermi National Accelerator Laboratory and Argonne National Laboratory will present the Midwest Launch…

Throughout the United States, policymakers continuously call on entrepreneurs to be an important cog in the economic engine. One of the key barriers to entrepreneurship, however, has grown largely as a result of state policies: burdensome student loan debt.  In the United States, the total amount of student debt is estimated at $1.2 trillion, a record high, according to the Consumer Financial Protection Bureau. Writing for the Wall Street Journal, Purdue University President Mitch Daniels, who previously served as Indiana’s governor, discusses the many ways that persistent student loan debt is a long-term threat to the inventiveness and innovation that has long been dependent on solving the nation’s economic problems. Several recent analyses have pointed to some of the potential impacts that student loan debt may have on American entrepreneurship, though few states have explicitly tied student loan debt to their debates over innovation policy.   In a recent study, two researchers from Northeastern University find a negative relationship between student loan debt, entrepreneurship, and entrepreneurial success. In The Cost of Financing Education: Can…

The rise of advanced manufacturing has opened the door to a resurgence of New England's manufacturing economy, according to a new report from The New England Council and Deloitte Consulting LLC. In Advanced to Advantageous: The Case for New England's Manufacturing Revolution, the authors suggest that the existing network of universities, private manufacturers and government partners give the region a competitive advantage in advanced prototyping, additive manufacturing and the Internet of Things. Leveraging that advantage, however, will require cross-state cooperation to build comprehensive educational pathways, rebrand the local industry and secure an Institute of Manufacturing Innovation. Read the report...

The Small Business Administration (SBA) announced that it will commit $4 million to the second round of the Growth Accelerator Fund Competition. Launched in 2014, the competition makes awards of $50,000 each to help fund operating budgets for accelerators and other entrepreneurial ecosystem models in parts of the country where there are fewer conventional sources of access to capital (e.g., venture capital and angel capital investors). For this round of funding, applications are encouraged from manufacturing accelerator models. Applications are due June 1. Read the announcement…

Although the percentage of college graduates with science and engineering (S&E) or S&E-related majors has increased, the proportion of college graduates employed in an S&E occupation has remained relatively unchanged at 10 percent since 1993, according to a recently released InfoBrief from the National Science Foundation’s National Center for Engineering Statistics. In the brief, authors John Finnamore and Beethika Khan use the most recent data from the National Survey of College Graduates (NSCG) to identify the distinguishing characteristics of the United States’ college-educated population. The NSCG surveys approximately 100,000 individuals to represent the college-educated population residing in the United States as of February 2013, with at least one degree earned before January 2012. College graduates, defined by an earned bachelor’s degree or higher, were categorized by both current occupation and major field of study. Within each of these, further distinction was given to science and engineering (S&E) occupations (e.g., scientist, engineer), S&E-related occupations (e.g., health-related occupations, S&E managers,…

In order to build a prosperous, globally competitive economy in Louisiana, state universities must take on a greater role as hubs of regional innovation, according to a report from the Public Affairs Research (PAR) Council of Louisiana. The report includes 46 recommendations to transform the state's economy by revamping existing innovation programs, and boosting university research. PAR's strategic plan is based on a review of innovation policies in other states, particularly Georgia and the work of the Georgia Research Alliance. PAR focuses on how existing state support for Louisiana R&D is spread too thin among the state's programs and allocated in inefficient ways. In particular, the Board of Regents Support Fund has been designed in such a way that funding is inconsistent and has not been targeted toward industries and operations that could have the greatest economic impact. Highlights from the recommendations include: Appoint a dedicated statewide leader to support Louisiana innovation; Provide sustainable support for the new WISE Fund, particularly for its research component; Reorganize the Regents Support Fund to promote the state's…

Pennsylvania’s economic development strategy should focus on building businesses rather than poaching, according to a new report from the Keystone Research Center (KRC) – All Pennsylvanians Prospering Together (APP): A Pennsylvania Economic Development Strategy for the Long Term. KRC’s Executive Director Stephen Herzenberg contends, “Pennsylvania needs to renew its historic bipartisan commitment to economic development,” and “create a national model of an economic development strategy in which all the people contribute to a joint effort to expand the economic pie and benefit from the growth of that pie.” In the report, KRC identifies four core principles to guide the state’s efforts: Investing in public goods  that deliver public benefits; Practicing market-based, not market-distorting, economic development; Investing in innovation and growing Pennsylvania’s own companies; and, Pursuing a Pennsylvania good jobs strategy. To achieve the KRC goal of Pennsylvania as a national model for an inclusive, equitable strategy focused on building not poaching, the authors identify several recommendations that include, but…

Only 17 companies had initial public offerings (IPOs) in the first quarter of 2015, the lowest number since the beginning of 2013, according to data from Thomson Reuters and the National Venture Capital Association (NVCA). This is a significant drop from the 37 IPO exits in the first quarter of 2014. Mergers and acquisitions (M&A) were also down, with 86 exits, compared to 115 in Q1 2014. While 2014 was an unusually active time for venture-backed exits, the current data appears to be a return to recession-era levels of deals and disclosed values. In their release, NVCA noted that a large number of venture-backed companies already have publicly filed for IPOs and there is no reason for concern yet about the future health of the venture market. However, the lull in activity could indicate that the burst of exits in all four quarters of 2014 was an anomaly. Companies in the biotechnology and medical sectors dominated IPO activity. Of the 17 companies that achieve IPOs, 13 were in these sectors. Venture fundraising remained strong in the first quarter of 2015, with firms raising more than $7 billion, according to NVCA. This is an increase from the $5.8…

Working groups at The Association of Public and Land-grant Universities (APLU) and The Association of American Universities (AAU), two membership organizations of higher education institutions, have released statements on the role of universities in managing intellectual property and technology transfer alongside their core missions and interest in maximizing public benefit. The two sets of recommendations differ slightly, yet both groups emphasize the importance of clearly defining and communicating the principles that guide their work and ensuring that discoveries made on their campuses can be developed for the benefit of the consumer. The 1980 passage of the Bayh-Dole Act not only created a standardized patent policy among the many federal agencies that fund research and development projects, but it also sparked technology transfer efforts across the United States by developing incentives for universities to secure patent protection and commercialization for inventions resulting from federally funded research. While the policy has had numerous successes, many detractors suggest that universities are more concerned with the monetization of IP rather than societal…

Last week, the Securities and Exchange Commission adopted final rules to update and expand Regulation A, an existing exemption from registration for smaller issuers of securities.  The new Regulation A+ will enable smaller companies to offer and sell up to $50 million of securities in a 12-month period, subject to eligibility, disclosure and reporting requirements. Under Regulation A+, there are two tiers of offerings that companies may make that include: Tier 1 – for offerings of securities of up to $20 million in a 12-month period with no more than $6 million in offers by selling security-holders that are affiliates of the issuer; and, Tier 2 – for offerings of securities of up to $50 million in a 12-month period with no more than $15 million in offers by selling security-holders that are affiliates of the issuer. Both tiers are subject to certain basic securities requirements while tier 2 offerings are also subject to additional disclosure and ongoing reporting requirements. The new rules are a major milestone to many in the crowdfunding industry because it addresses three primary criticisms of Regulation A. First, under Regulation A+,…