The PTO should expand its telecommuting programs to establish satellite offices around the country to allow patent examiners greater flexibility to live in lower-cost areas.

The PTO’s policy of requiring examiners to check into the office every two weeks requires patent examiners to live in the Washington, DC metro area. If PTO set up small satellite offices around the country examiners could choose to live in less expensive areas and increase their standard of living, while still getting access to an office.

In order to reduce the Patent and Trademark Office’s backlog of pending patents, Congress should end patent fee diversion and gives the PTO regulatory authority to raise fees to meet budgetary needs.

To reduce the delays that currently plague the U.S. patent system, the PTO should be able to retain all patent fees and the PTO should have fee-setting authority to increase fees to meet budgetary needs. The current statute requiring USPTO to wait for a congressionally amended fee schedule is inflexible and does not allow USPTO to respond to increased costs.

State and local governments should fund Statewide Commercialization and Entrepreneurship Organizations to connect resources with local innovators and entrepreneurs.

Commercialization and entrepreneurship are keys to economic development. To maximize both, there should be at least one organization in each state that has this as its mission. One model is Oklahoma’s non-profit i2E organization. Through its various programs i2E helps Oklahoma companies with strategic planning assistance, networking opportunities, and access to capital. Likewise, Pennsylvania’s Ben Franklin Technology Partners have over their 25 year history evolved to serving as a statewide resource for technology commercialization for entrepreneurs.

To grow manufacturing jobs states should extend sales tax parity for purchases to computers and IT equipment used in the production process.

A wide array of economic studies points to the importance of IT in driving productivity. Yet, most states are still stuck in the old economy when it comes to their tax incentives for manufacturers. Most provide a sales tax exemption for manufacturers for equipment purchased in the manufacturing process, and some even provide tax credits for the purchase of manufacturing equipment. But few extend this exemption (or credit) to computer and other IT equipment used in the rest of the plant, even though from a competitiveness standpoint it can have an even bigger impact than a traditional piece of machinery. For example, under Washington state’s rules governing its manufacturing sales tax exemption , manufacturing computers qualify only if they “direct or control machinery or equipment that acts upon or interacts with tangible personal property” or “if they act upon or interact with an item of tangible personal property.” Many other states have similar restrictions. States should simply eliminate this requirement and allow any IT equipment, software or devices purchased by manufacturers to be exempt from state sales taxes.

To increase capital for startups, require that the federally supported Small Business Investment Companies (SBIC) program to invest at least 25 percent of its funds in early and small deals.

Since it was revised over a decade ago, SBIC has been an effective tool. However, if all the program does is provide lower cost capital to venture firms investing in late stage and large deals, it is not fulfilling its purpose of addressing market failure or limitation. Congress should require that SBIC devote some share of funds (perhaps not less than 25 percent) to smaller deals (perhaps less than $2 million).

Congress can tie states’ receipt of federal funding to maintenance of rainy-day funds of at least 10 percent.

Through their fiscal policies, states play an increasing role in U.S. macroeconomic stability. Yet most have underfunded rainy day accounts. As a result, when national economic downturns hit, states raise taxes and cut spending, exacerbating recessions and slowing recovery. The federal government can put policies in place to ensure that state and federal budget policies are more harmonized. One way to do this is to tie the states' receipt of federal funds to their willingness to maintain much larger rainy day funds.

Congress should appropriate $1 billion annually for a competitive matching grant fund to fund state-supported technology-based initiatives.

To boost U.S. international competitiveness and the number of good jobs, we need a more robust innovation policy. State governments can play a key role in this. In fact, all 50 states now have initiatives to promote technology-based economic development. However, because the benefits of innovation spill across state borders, states invest less in innovation-based economic development than is in the national interest.

Congress and the Administration should allocate $180 million per year for the creation and expansion of Math and Science High Schools.

More so than other high schools, math and science high schools produce benefits that local communities, and even states will not capture. Rather than be seen as solely the responsibility of local school districts, or even of states, they should be seen for what they are: a critical part of the nation’s scientific and technological infrastructure. Congress and the Administration should set a goal of approximately quadrupling enrollment at such high schools to around 250,000 students. This will require both the creation of a significant number of new high schools, and the expansion of others with room to grow. Moreover, these funds should go toward establishing MSHSs focused on underrepresented populations. States and/or local school districts would be required to match every dollar of federal support with two dollars of state and local funding. Industry funding would count toward the state and/or local school district match.

Congress should create a New Schools America fund to support states and cities to develop new kinds of schools.

The fund would help encourage state legislatures to create specialized schools that are autonomous from the management of traditional schools.

Congress should enact modifications to the R&D tax credit to allow companies to take a credit for donations of scientific equipment to high schools.

Institutional partnerships are a key to success of Math and Science High Schools (MSHSs). Whether it’s the donation of research equipment, the opening of their facilities to students and faculty, or mentoring of students, technology-based companies can play an important supportive role.
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