Senators Collins and Clinton Introduce Bill to Create National Innovation Council

The creation of a single organization to consolidate federal innovation investments, called for by the Brookings Institution and the Information Technology and Innovation Foundation (ITIF) (see the April 23, 2008 issue of the Digest), moved a small step closer to reality with the introduction of authorizing legislation in the U.S. Senate.
 
S. 3078, the National Innovation and Job Creation Act of 2008, was introduced on June 3, 2008, by Sen. Susan Collins (R-ME) and cosponsored by Sen. Hillary Clinton (D-NY). The bill calls for the creation of a National Innovation Council within the Executive Office of the President and several new grant programs to support state-directed technology-based economic development initiatives.
 
One of the missions of the National Innovation Foundation proposed by ITIF and Brookings was to consolidate federal programs involved with innovation into a single organizing office. As drafted, S. 3078 would move the following programs to the proposed council:

• From the National Institute of Standards and Technology,
  • The Manufacturing Extension Partnership (MEP) Program;
  • The Technology Innovation Program;
  • The Office of Technology Partnerships.
• From the National Science Foundation
  • Partnerships for Innovation;
  • Industry-University Cooperative Research Center Program;
  • Engineering Research Center Program.
• From the Department of Labor:
  • Workforce Innovation in Regional Economic Development.

The Council would be tasked with creating and collecting data for improved measures of innovation and productivity, working in concert with the Census Bureau, the Bureau of Economic Analysis, the Bureau of Labor Statistics and several other federal statistical agencies.
 
Five new grant programs would be administered by the Council if S. 3078 passed in its current form. While specific authorization levels are not mentioned for most of the programs, the size of the awards mandated for each state suggests a considerable pool of new federal investment would be required after nearly a decade of reduced or level funding for most federal tech-based economic development spending.
 
CLUSTERS Program
S. 3078 authorizes a $350 million CLUSTERS program, which stands for the Competitive Leadership for the United States Through its Economic Regions Program. The CLUSTERS program would make matching grants to states or entities designated by a state or group of states to support the planning and operation of cluster programs and cluster initiatives.
 
Feasibility grants for planning could be as large as $250,000. Each state would receive at least one $1 million in start-up funds to initiate a cluster program and at least one annual operating grant of $1 million per year for five years. In addition, CLUSTERS would include a competitive matching grant program to provide awards up to $15 million to support specific cluster initiatives.
 
State Innovation-Based Economic Development Grants
Structured somewhat similarly to CLUSTERS but without an authorization level, the new council would provide each state with at least one one-time $250,000 feasibility study grant and a one-year $2 million start-up grant. States also would be eligible to receive at least one annual operating grant that could be renewed indefinitely.
 
Federal grant funds, which could only represent one-third of a project’s cost, could be used to establish technology commercialization centers, industry-university research centers, regional cluster development programs, regional skills alliances, entrepreneurial support programs, science parks, and related activities to spur innovation or productivity.
 
States also would be required to prepare strategic plans to describe, among other things, how grant funds “would be used to support the creation of alliances for the dissemination of innovation among local governments, businesses, educational institutions and other institutions.”
 
Technology Diffusion Grants
The MEP centers in each state would receive feasibility, start up and annual grants – again on the same $250,000 and $2 million levels as the state innovation grants – to support manufacturing extension services.
 
National Sector Research Grants
The council would award competitive matching grants of unspecified amounts to support industry-led consortia involving at least five companies that commit to developing three- to 10-year technology roadmaps for the consortia. The Department of Energy had a similar program in concept during the Clinton Administration entitled Industries of the Future.
 
Productivity Enhancement Research Grants
The council would be authorized to provide grants to academic institutions and university-industry joint ventures to support early-stage research into methods to increase productivity and innovation. No specific grant amounts are identified in the bill.
 
S. 3078 has been referred to the Senate Committee on Commerce, Science, and Transportation for its consideration.