SSTI Digest

States have been slow to recover from the recession, but amid all the doom and gloom surrounding the national economy, state general fund expenditure trends are moving in a positive direction. The Spring 2012 Fiscal Survey of States finds governors' recommended budgets show an overall increase in both general fund expenditures and revenues in fiscal year 2013. There are, however, significant challenges ahead for states, including increased expenditures, particularly Medicaid costs and enrollment, and reductions in federal funding.

Fiscal 2013 budgets forecast that general fund revenues will reach $690.3 billion, surpassing peak pre-recession levels by $10 billion. Revenue collections are expected to be 3.7 percent above 2011 levels in sales, personal income and corporate tax collections, which make up 80 percent of general fund revenues. The report finds that growth from all of these sources produced greater collections than projected in many states.

Each year, a group of talented and dedicated practitioners from across the country converge to learn from one another, share successes and challenges, and participate in a national dialogue on improving innovation and competitiveness. This year's theme, The Power of Re- Defining, Imagining and Energizing Regional Economies, echoes the need for bold, innovation-centered ideas and TBED organizations are leading the charge.

To ensure the 2012 Excellence in TBED award winners are front and center in the lively debates, discussions and solutions that arise during the conference, we are inviting them to attend as our guests (a $595 value). In addition to promoting their achievement to a national audience, award winners will have the opportunity to network, attend sessions and better their practice. Applications are due July 17! More information is available at: http://www.sstiawards.org/.

Richard Bendis has been named the first president and CEO of BioHealth Innovation, Inc. a regional private-public partnership focusing on commercializing market-relevant biohealth innovations and increasing access to early stage funding in Central Maryland.

RI Gov. Chafee on May 17 accepted the resignation of Keith Stokes, executive director of the Rhode Island Economic Development Corporation. The RIEDC's deputy director, William Parsons, currently is serving in Stokes' place. Although a successor for Stokes has not been named yet, the governor has nominated six people to the board that oversees RIEDC after the vice chair and other members resigned. The nominations are subject to Senate confirmation.

In Pittsburgh, PA, The Technology Collaborative is dissolving. Innovation Works will take over some of TTC's programs.

Michael Pazzani, vice president for research and economic development at Rutgers, has accepted the position of vice chancellor for research and economic development at the University of California, Riverside, effective July 1.

A new report from the National Academies' National Research Council urges the U.S. federal government, state government, business and universities to act in concert to preserve the competitiveness of the nation's research universities. The report, a follow-up to 2005's Rising Above the Gathering Storm, suggests that a number of ongoing trends threaten U.S. global leadership in higher education. The most critical of these issues are declining federal funding for university research and the erosion of state support for higher education in general. By restoring university funding, easing regulatory and reporting requirements, building stronger university-business research partnerships and addressing attrition rates within graduate programs, the U.S. can restore its national research ecosystem, according to the report.

Governments of advanced economies are starting to believe as the 21st century advances significant opportunities for their technology-based product and service sectors will emerge from increasingly open, competitive and affluent global markets. To compete in this changing world, they are looking to expand access to capital for startups and entrepreneurs, support their research and development (R&D) infrastructure and address weaknesses in their national economies. Canada, the United Kingdom and the European Union (EU) are among those that recently have announced initiatives or released reports intended to strength their national innovation economy.

Canada
Canada must become more productive to sustain its high standard of living, according to the Organization for Economic Co-operation and Development's (OECD) Economic Survey of Canada 2012. The report points out that Canada's overall productivity has slightly fallen since 2002 compared to a 30% increase over the past 20 years in the United States. To address this decline in productivity, the OECD identified two priorities:

Compiling SBIR Phase I awards and proposal statistics by state for FY11, SSTI finds the 10 states with the most awards in FY11 were California (674), Massachusetts (416), Virginia (215), New York (146), Texas (143), Maryland (142), Colorado (130), Ohio (130), Pennsylvania (124), and Florida (92). New York moved into fourth place, up one spot from last year while Texas moved into fifth place, up from seventh place. Colorado fell three spots from last year to seventh place, tying with Ohio, which moved up one spot, dropping Pennsylvania to ninth place. Florida moved into the top 10, climbing from 12th place last year and dropping Michigan out of the top 10.

Notably, the total number of SBIR Phase I awards and proposals are down quite a bit from 2010 across nearly all of the participating agencies. In FY11, agencies granted a total 3,268 awards, down from 4,388 in FY10, a 25 percent decrease. Overall, agencies that reported proposal statistics received 11 percent less proposals in 2011 than 2010.

The Department of Energy (DOE) announced a new $120 million five-year multidisciplinary and sustained effort intended to identify problems and develop solutions across the lifecycle of critical materials. The Critical Materials Hub will work to advance U.S. leadership in energy manufacturing (e.g., electric vehicles, wind turbines and efficient lighting) through research aimed at having a reliable supply of these rare earths and other critical materials, as well as finding efficiencies and alternatives that reduce the amount needed. It is the fifth Energy Innovation Hub established by DOE since 2010. Institutions of higher education, nonprofit organizations and private firms are eligible to apply and are encouraged to form partnerships with regional entities. Interested organizations should submit their concept papers to the DOE by June 29, 2012.

Past judges of the Excellence in TBED award program have told us they want to read a clear, concise and compelling story about how tech-based initiatives are improving local, state and regional economies. To assist applicants in their quest for the trophy, SSTI has provided several resources for writing an outstanding proposal. First, we recommend downloading the brochure, which explains the program philosophy and provides complete instructions. Writing samples from past award winners are available to gain a better understanding of what the judges are looking for in the narrative. Finally, listen to a conference call from SSTI President and CEO Dan Berglund for helpful tips and direction. Applications are due July 17! Learn more at: http://www.sstiawards.org/.

This week, the Nevada Governor's Office of Economic Development announced the ten organizations that will serve as local partners in state economic development initiatives. The new Regional Development Authorities (RDA) will lead regional economic development efforts by linking partners in their respective communities. Gov. Brian Sandoval introduced the RDA concept in his State Plan for Excellence in Economic Development earlier this year (see the Feb. 8 issue).

The Michigan Economic Development Corporation (MEDC) announced last week five new programs under the Pure Michigan Business Connect initiative established last year to provide small businesses in emerging industry sectors with economic development incentives, startup capital and support services (see the June 8, 2011 issue of the Digest).

The new programs focus mostly on providing access to capital and making connections. They include:

The Kansas Bioscience Authority (KBA) has launched a collaborative partnership of more than 90 contract research organizations (CROs) to help the region compete in the pharmaceutical and medical device industries. BioResearch Central will help promote the Greater Kansas City region as a destination for pharmaceutical R&D at a time when drug companies are increasingly looking overseas for their contract research needs. The announcement follows the release of a KBA commissioned study that suggests pharmaceutical contract research is a $90-$105 billion industry in the U.S., much larger than previous estimates.

U.S. immigration policies are irrational and undirected according to a new report from the Partnership for a New American Economy and Partnership for New York City — Not Coming To America: Why the U.S. is Falling Behind in the Global Race for Talent. In sharp contrast, to attract immigrants that drive economic growth and increase international competitiveness, foreign countries have adopted targeted and strategic policies that include: