SSTI Digest

U.S. states must develop an export strategy as a component of the state's “competitiveness agenda,” according to a new report from the Brookings Institute. In “Boosting Exports, Delivering Jobs and Economic Growth,” the authors point towards the rapid growth of American exports in comparison to the overall economy's economic growth to highlight the need for effective and efficient state export strategies. Between the third quarter of 2009 and the third quarter of 2011, U.S. exports grew by 12.7 percent almost four times the overall economic growth (3.2 percent). States, the authors contend, fail to export efficiently and effectively for several reasons including lack of data to understand strengths and weaknesses; efforts are reactive, fragmented and inconsistently funded; or states ignore exporting efforts by the federal government and other institutions leading to duplication of and failure to leverage those programs. The report provides three policy prescriptions to remedy those issues. They include:

• “Get smart about assessing exports and the performance of their export promotion activities;”

Alabama then-Governor-elect Robert Bentley on January 3 named former House Speaker Seth Hammett as director of the Alabama Development Office, replacing Interim Director Linda Swann. He also appointed the president of the Birmingham-based Economic Development Partnership of Alabama, Bill Taylor, to lead efforts to grow and retain existing Alabama industries, while at the same time recruiting new businesses to the state.

Colorado Gov. John Hickenlooper nominated Dwayne Romero, president of Related Snowmass, to be the new director of the Colorado Office of Economic Development and International Trade.

Florida Governor Rick Scott fired John Adams, the current president of Enterprise Florida, so that he can choose a new leader to help promote his job creation and economic development agenda.

Hosted by TechColumbus, SSTI's 15th Annual Conference will be held at the Hyatt on Capital Square in Columbus, Ohio on November 8-9, 2011. Past attendees know SSTI's conference is the premier event for sharing ideas on the best ways to encourage technology-based economic development and foster regional prosperity in a global economy. And 2011 will be no exception.

Central Ohio provides an excellent backdrop to celebrate SSTI's 15th Annual Conference. The state has made science and technology a central focus for its economic development investments, making Columbus a perfect choice to showcase successful technology-based economic development practices and strategies.

SSTI's full report is available for download in pdf format.

The fifth installment of SSTI's Tech Talkin' Govs series includes excerpts from speeches delivered in Maryland, Montana, Oklahoma, Texas, and Utah. The first four installments are available in the Jan. 5, Jan. 12, Jan. 19 and Jan. 26 issues of the Digest.

Maryland
Gov. Martin O'Malley, State of the State Address, Feb. 3, 2011
"To create more jobs, we must leverage the power of our diversity... we must leverage the power of our geography... And we must harness the potential of Maryland's Innovation Economy: bio-tech, green-tech, clean-tech, cyber security, information technology, aerospace, global trade, and next generation manufacturing. ...

Following last week's announcement of the Startup America initiative, the National Economic Council, the Council of Economic Advisors and the Office of Science and Technology Policy have released the details of its innovation strategy. The strategy emphasizes the private sector's essential role in building next-generation companies, with the government serving as an "innovation facilitator." It includes recommendations on how the federal government can invest in the necessary building blocks for research and entrepreneurship, promote market-based innovation and catalyze strategic industries. SSTI will examine these recommendations in greater detail in next week's federal budget issue. The Department of Commerce (DOC) has released a request for information (RFI) regarding the measures that could achieve its innovation goals. The announcement includes ten questions to help guide the discussion. DOC also will accept electronic versions of reports, articles and analysis. Comments must be submitted by April 1, 2011.

Gov. Andrew Cuomo announced plans to direct $200 million in existing funds to establish 10 regional economic development councils to allocate funds and provide business assistance programs across the state. At the same time, the governor would consolidate programs supporting high-tech companies currently administered by the New York State Foundation for Science, Technology and Innovation (NYSTAR) with the Empire State Development Corporation (ESDC) — a move he says will eliminate duplicative functions and save the state $1.9 million in the coming year.

A majority of the funds slated for the councils ($130.6 million) would come from reprioritizing and redirecting existing economic development funds for competitively determined project grants, according to budget documents. The councils, made up of state government, business, community, and academic leaders, would compete for the funds based on economic development plans. Another $70 million would be provided in tax credits through the enhanced Excelsior Jobs Program.

Citing the need to ensure a competitive edge in the weak economic climate, Texas Gov. Rick Perry is asking lawmakers to continue investing in the state's economic development tools by providing an additional $15 million for the Texas Emerging Technology Fund (ETF) and retaining funding for the Texas Enterprise Fund in the coming biennium. The governor also is proposing $50 million for science, technology, engineering and mathematics (STEM) scholarships and $32 million to increase STEM academies.

Gov. Perry is seeking $219.2 million for his priorities and initiatives over the next two years, which includes the additional funds for the ETF and STEM incentives as well as $20 million for the Film and Video Game Incentive program and $11.3 million for Economic Development & Tourism. House and Senate committee budget recommendations unveiled last month would provide $21.3 million for the ETF in unexpended balances not obligated in the current biennium, but add no new funding. The governor's budget would add an additional $15 million to foster emerging technologies, enhance university-industry collaboration, and promote technology commercialization.

Vermont Gov. Pete Shumlin has released a jobs package that includes a number of initiatives that could enhance the state's innovation economy. The jobs bill calls for a new creative economy office that would focus on technology efforts, a mentoring program for entrepreneurs, a statewide internship program, and a tax credit for companies that hire STEM graduates. Gov. Shumlin also has renewed his predecessor's pledge to extend full wireless voice and data coverage across the state.

The governor, announcing the jobs bill last week, said that the legislation is intended to help stimulate every sector of Vermont's economy. Accordingly, most of the bill's provisions benefit the state's agriculture and food industries. Several initiatives, however, specifically target manufacturing, high-tech businesses and entrepreneurship.

A revamped version of the $8 billion Universal Service Fund (USF) could be used to expand broadband access in underserved areas. On Tuesday, the Federal Communications Commission (FCC) proposed a plan to redirect the portion of the USF that provides incentives to extend phone service to high-cost areas to instead support high-speed data networks. A new program, the Connect America Fund, would consolidate several USF programs, eliminate some of the programs' inefficiencies and increase the availability of affordable broadband service. The proposal is the latest step in a series of changes planned by the FCC to implement its National Broadband Plan.

Starting in the spring, a new Small Business Association (SBA) loan program — the Community Advantage loan program— will increase the availability of loans (up to $250,000) to: 1) small businesses, 2) firms that are less than two-years old or 3) those owned by veterans. The program specifically will target businesses in low- to moderate-income communities. Currently, small businesses face difficulty receiving loans of this size due to perceived risk involved (historically high default rates). Nonprofit institutions and banks that participate in the SBA's Preferred Lender Program will be the providers of these SBA guaranteed loans. To incentivize lenders, loans will guarantee up to 85 percent. SBA will accept applications from interested lending institutions starting March 15. Read about the program ...

Sixteen percent of all high-impact, high-tech companies include at least one immigrant, according to a new report by the Center for Technology Innovation at Brookings. They survey and consequent case studies found significant trends among immigrant entrepreneurs in the high-tech field. Respondents were found to be heavily rooted in the U.S. — 77 percent of them have become American citizens and almost 75 percent have lived in the U.S. for more than 15 years. In comparison to their domestic peers, immigrant entrepreneurs have much higher educational achievement (almost twice as likely to hold a doctoral degree). These individuals have a similar amount of work experience to their successful domestic counterparts (roughly 10 years). Finally, the number of immigrant entrepreneurs is roughly equal to the total immigrant population (13 percent). However, since 1990 the number of immigrants with a bachelors degree or above in a STEM related field has increased significantly.