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Southern Exposure Equals High-Tech Innovation

This in-depth look at 14 southern states shows how technology is sparking new developments in a variety of industries - some traditional, others decidedly 21st century - and how state and local governments are supporting the initiatives.

Southern Tech Sites 2009
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Texas touts life sciences, pharmaceutical development, and bio-engineering as strong and growing sectors. A study released in May by the Texas Healthcare and Bioscience Institute (THBI) says that the life sciences industry - composed of four primary niche sectors: agriculture, medical devices, pharmaceuticals, and research and testing - is a powerful economic driver, supporting 236,000 jobs and generating a total annual economic impact of $75 billion. The state currently invests more in basic biomedical research than all but two other states.

The computers and electronics sector was strengthened by Texas Instruments' (TI) new chip production facility in Richardson. TI reports that the fab will be the world's only production facility to use 300-millimeter (12-inch) silicon wafers to manufacture analog chips, which are essential components in virtually all electronics. The company says it expects the project to create 250 engineering, manufacturing, and administrative jobs.

The Emerging Technology Fund (ETF), the Lone Star State's main engine for encouraging the development of new technologies, focuses on fostering innovation, research, and job creation in emerging high-tech industries like semiconductor manufacturing, biotechnology, nanotechnology, environmental sciences, and advanced energy, while allowing university researchers to bring their technologies from the laboratory to the marketplace. The ETF has allocated more than $102 million in funds to 81 early-stage companies and $148 million in grant-matching and research superiority funds to Texas universities.

A $50 million ETF investment was awarded to the National Center for Therapeutics Manufacturing at Texas A&M University, a facility that will offer pharmaceutical companies the flexibility to manufacture clinical grade commercial drugs in Texas. The center will be essential to containing the entire lifecycle for new drugs within the state, therefore retaining investment and jobs.

While Texas has always been identified with traditional energy, diversifying the state's energy portfolio also remains a priority. The governor's office notes that Texas has already installed more wind power than any other state and is also interested in development of next generation nuclear power plants, as well as the addition of new clean coal plants.

Virginia's technology-based economy is focused in three sectors - energy, information technology, and advanced manufacturing, according to Liz Povar, director of business development for the Virginia Economic Development Partnership. New projects related to in the aerospace sector include Rolls Royce's jet engine manufacturing, test and assembly facility in Prince George County that will create 500 new jobs; and a new facility in Martinsville for titanium manufacturer RTI that will employ 150 people. Another aerospace supplier, Alcoa Hownet, is increasing capacity and production of investment castings for industrial gas turbines at its Hampton operations. Orbital Sciences expects to create 125 jobs at its Mid-Atlantic Regional Spaceport for its rocket program.

Incentives are modified and adapted to spur growth. New incentives include a sales-and-use tax exemption for servers locating in major data centers. In addition, the Tobacco Commission Research and Development Grant Program has earmarked $100 million for a competitive research grant program to support research based commercialization of new technologies. The commission funded five Centers of Excellence in the areas of energy, chemicals and materials, information technology, biomedical sciences and healthcare, and transportation logistics in southern and southwestern Virginia.

State incentives play a major role in new business development. "Virginia emphasizes performance-based grants that support research and development," says Povar. For example, the partnership between Rolls Royce and the University of Virginia will result in the Commonwealth Center for Advanced Manufacturing adjacent to the manufacturing facility, as well as research-chaired professorships at participating schools.

Povar also cites the governor's Opportunity Fund and work force training programs. AREVA and Northrop Grumman Shipbuilding are partnering to manufacture equipment and pressure vessels for the nuclear industry and to provide nuclear engineering services. The $363.4 million investment received $3 million from the  Opportunity Fund, a $1.5 million performance-based grant from the Virginia Investment Partnership (VIP) program, training assistance through the Virginia Jobs Investment Program, a Major Business Facilities Job Tax Credit, and road access funding. The project will create 540 new production and engineering jobs.

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