SSTI Digest

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 fifth installment of this year’s series includes excerpts from speeches delivered in Illinois, North Carolina, Oklahoma and Tennessee. Read the first, second, third and fourth installments of this year’s series. IllinoisGov. Bruce Rauner, State of the State Address, Feb. 4, 2015"... Too many people in our communities must overcome not only hurdles that state government has put in place, but also decades of hidden barriers that have caused their communities to suffer. Approximately 80% of individuals in Illinois apprenticeship programs are white even though Caucasians make up fewer than 63% of our population. ..." "... We should require unions that contract with the state to have their apprenticeship programs reflect the demographics of Illinois communities, and to have their membership on public construction projects reflect the diversity in the surrounding area.…

AdvanceKentucky continues to demonstrate its ability in Kentucky schools to dramatically increase access to and accelerate successful learning in rigorous math, science and English (MSE) courses, as shown by qualifying scores on Advanced Placement exams, according to a new research reported undertaken in 2014 by the Kentucky Center for Education and Workforce Statistics. AdvanceKentucky was particularly effective for students from underrepresented populations. The researchers found that AdvancedKentucky students: scored better on their ACTs by 1.5-points; achieved a 10 percentage-point advantage in earning college or career ready status; and, have higher college persistence rates while earning higher GPAs and graduate from college in four years from college at twice the rate of non-AdvanceKentucky students. They also are significantly less likely to attend remedial courses – only 10 percent of AdvancedKentucky students took at least one remedial course compared to 50 percent for the control group. Currently 101 schools across Kentucky use the AdvanceKentucky program. Read the release…  

The U.S. is home to more than 28.4 million small businesses (less than 500 employees), employing over 56 million workers (approximately half of the nation’s workforce), according to a recently released a report entitled Small Business Profiles for the States and Territories, an annual analysis of each state’s small businesses. Released by the Small Businesses Administration’s Office of Advocacy, the report provides information on the number of firms, employment, demographics, and other topics at both the national and state levels. Included in the report are detailed profiles for all 50 states and key U.S. territories that are intended to be a reference tool for researchers, policymakers, and small entities who are interested in how small firms are performing regionally or nationally. Key national statistics include: Firms with fewer than 100 employees have the largest share of small business employment; Nationally, small businesses created nearly 2.2 million net new jobs in 2012 – the biggest gain was in the smallest firm size category of one to four employees; The median income for individuals who are self-employed at their own incorporated…

On Monday, President Obama released his $4 trillion budget request for FY16. His proposal is again unlikely to find support in Congress, but serves as a useful guide to the administration’s priorities and a source of new ideas. This year’s budget document is being presented as a policy pathway to rebuilding middle class opportunities, embracing “Middle Class Economics for the 21st Century.” In embracing this agenda, the administration has included several new programs and significant spending increases for STEM education, manufacturing and R&D, though the proposed funding levels for most offices appear similar to those included in the administration’s past budget requests. This year, SSTI’s review of the president’s budget request will be shorter than in previous years. The summary below includes proposed spending on initiatives directly related to innovation and economic development. A Note on ComparisonsAll comparisons in the text below use FY15 enacted levels as their basis, except where otherwise noted. Highlights for the technology-based economic development community include: EDA’s…

President Obama’s proposed FY16 budget would provide $25 million for the EDA’s Regional Innovation program, a key legislative initiative for the technology-based economic development community. The Regional Innovation Program was authorized under the American COMPETES Act and is designed to provide funding to support regional innovation activities. The program received its first funding of $10 million in FY14 after extensive work on the Hill by SSTI, its members and others. A second infusion of $10 million was provided in the December FY15 continuing resolution/omnibus spending bill. More than 60 organizations signed a letter urging Congress to fund the program at $20 million (see August 7, 2014 Digest article) for FY15. The U.S. Department of Commerce announced that the FY14 solicitation had received 254 applications requesting more than $100 million in funding.

Advanced industries employ just 9 percent of the U.S. workforce, yet produce about 17 percent of all U.S. gross domestic product, 60 percent of exports, 85 percent of patents, and 90 percent of private-sector R&D expenditures, according to a new report by The Brookings Institution.  Using data from the Organization for Economic Co-operation and Development (OECD) and Moody’s Analytics, the report defines advanced industries as those where industry R&D spending exceeds $450 per worker and where at least 21 percent of workers have STEM-knowledge intensive occupations (the average across industries is 20 percent). The advanced industry sector is comprised of 50 industries, as defined by four-digit NAICS codes, with 35 manufacturing sectors, 12 service sectors, and three energy sectors. Advanced industries provide a significant wage premium at every level of education, and since 1975, average earnings in advanced industries have increased at a rate nearly five times faster than the economy as a whole. Despite having the most productive advanced industries in the world besides energy-intensive Norway, the authors of the report contend that the…

New Texas Gov. Greg Abbott recently announced several planned changes for the state’s economic development efforts. The governor is restructuring a number of offices, including the Workforce Investment Council and Women’s Commission under the Director of Economic Development, to increase focus on job creation. Abbott also proposed the elimination of the state’s Emerging Technology Fund, and using the programs remaining balances to launch a new University Research Initiative. The new program would provide matching funds to help Texas universities recruit world-class researchers. Additional ETF funding would be transferred to the Texas Enterprise Fund, a deal-closing fund administered by the governor’s office. Read the announcement…

The Department of Energy’s Office of Energy Efficiency and Renewable Energy (EERE) announced that it will combine three existing programs (Incubator, SolarMat, and SUNPATH) into the Sunshot Technology to Market Program – a new funding program to support startups and other for-profit organizations as they bring disruptive solar innovations to the market place. Historically, the three programs that comprise the new program were separated by stage of technology development. In the interest of optimizing the application and selection process, the new program will focus on disruptive solar technologies at all stages of development and offer six tiers based on the type of product (hardware or non-hardware) and product maturity. Concept papers are due Feb 24; applications are due Apr 22. For more information, read the announcement (DE-FOA-0001225)…

The Department of Defense (DOD) released a federal funding opportunity (FFO) to establish the newest Institute for Manufacturing Innovation (IMI) focused on flexible hybrid electronics manufacturing. Administered by the Air Force Research Laboratory, the Flexible Hybrid Electronics is the seventh IMI to be established under the Obama administration and the fifth to be led by the DOD. Lead applicant eligibility is restricted to nonprofit organizations. However, applicants are encouraged to establish a regional consortium that includes members from academia, government and industry. For those interesting in applying, the DOD will host two Proposer’s Days on: February 19 in Arlington, VA; and, February 26 in Monterey, CA. Applications are due May 29. For more information, read the announcement (BAA-RQKM-2015-0014)…

In a report released by the Commission on Entrepreneurship and Middle-Class Jobs at this year’s Milstein Symposium, a convening held at the University of Virginia’s Miller Center dedicated to restoring the American Dream, the authors deliberate the significant barriers to American entrepreneurship and postulate potential policy recommendations. Ultimately, the authors propose five ideas that they believe would help rebuild the American dream by promoting entrepreneurship: Unlock Capital for Main Street Entrepreneurs: The small businesses in America’s small towns, or “Main Street” entrepreneurs, often have difficulty accessing the capital needed to grow their businesses, a problem exacerbated by the Great Recession’s negative impact on community banks, which had historically been these businesses’ primary lender.  As a way of increasing access to capital, the authors propose restoring the Community Reinvestment Act of 1977 and increasing investments in Community Development Financial Institutions Fund. Accelerate Impact Investing through PRIs: Program-related investments (PRIs) are a financial tool used by foundations to…

Governors in Maryland, Minnesota, and Florida proposed substantial funds to higher education in their budgets this week, with an emphasis on affordable education and expanded research capacity. Maryland Gov. Larry Hogan’s structurally balanced $40.5 billion FY 2016 budget marks the first time in 10 years that the state’s general fund spending would be aligned with available general fund revenues, according to the governor’s office.  Included in Gov. Hogan’s proposed budget allowance is: $10.6 million to support small, minority, and women-owned businesses and $6.3 million to promote small businesses owned by economically and socially disadvantaged entrepreneurs. $12 million in biotechnology tax credits to leverage investment for life sciences companies, $9.4 million to further develop stem cell technology, and $2.5 million, after contingent reductions, in investments and tax credits to promote cybersecurity research. $9 million in research and development tax credits, $8.5 million to create endowed research chairs at universities, and $4.9 million to commercialize research conducted at participating universities through the Maryland…

As the federal and state governments look for methods to support the creation and retention of well-paying science and tech (S&T) and manufacturing jobs, two recent reports have found that R&D tax credits play a vital role in helping keep domestic R&D-intensive firms resilient from economic downtowns and competition from emerging economics. These studies confirm the importance of R&D-intensive firms, which have taken advantage of R&D tax credits, are more likely to report a higher percentage of corporate liquidity; are less likely to cut capital expenditures and employment; and, downsize considerably less than the average firm. In a recent study from HEC Paris, Johan Hombert and Adrien Matray found that R&D-intensive firms were more resilient to import competition from China and other emerging economies – especially if they received tax credits for performing R&D. In Can Innovation Help U.S. Manufacturing Firms Escape Import Competition from China?, the authors examined the importance of R&D tax credits on the resiliency of R&R-intensive firms including S&T and manufacturing firms. The authors found that while the average…