A 21

st

Century Land Grant Act for Federal Laboratories: Connecting with the Community

Brian Darmody Associate Vice President for Research and Economic Development University of Maryland Federal Lab Consortium Mid Atlantic Meeting Gettysburg, Pennsylvania September 16. 2009

Presidential Trivia

Name the only U.S. President to be granted a U.S. patent?

Land Grant Universities in the US

President Lincoln signed the original Land Grant Morrill Act. This federal law connected public universities with the then leading industry – agriculture—to advance science and to feed the world.

The Land Grant Act was the nation’s first technology transfer program

So, What’s Up with this Lincoln Dude?

• This Year We Celebrate the 200th Anniversary of Abraham Lincoln’s birth • Abraham Lincoln Signed the

Morrill Act

creating the Land Grant System for state research universities connecting university researchers to their regional industries • Abraham Lincoln also signed the Congressional Charter creating the National Academies of Science • At the National Academies of Science earlier this year, President Obama outlined an ambitious plan to restore research and development as major thrust of US government • And, appropriately, we are meeting in Gettysburg……..

In National Academies Speech, President Obama Announces Major Federal Investments in Research and Development

April 27, 2009

Fed Labs as Research Universities

• • • • • • Home to Nobel prize winners and numerous members of the National Academies Administers billions of research and development dollars; almost as much as colleges and universities Federal researchers author tens of thousands of published journal articles A growing recognition of their importance to regional economic development Constructing New Major Research Facilities to augment existing significant research infrastructure Fed labs are home to the largest medical library and largest agriculture library in the world

A New Look at Federal Labs

• Federal Laboratories were not around in Lincoln’s time, and there is no comprehensive statutory initiative to connect them to their local communities • Maryland, Virginia and DC have nation’s largest concentration of fed labs • Can we take better advantage of the enormous amount of technology capital, human capital, and physical capital in federal laboratories?

A 21

st Century Land Grant Act for Fed Labs

University Technology Commercialization Critique

Advancing Innovation

While university research has spun out many high-impact companies, a great number of promising discoveries consistently fail to be developed and brought to market for practical use. Contributing to this problem is a series of bottlenecks that result from the current closed and linear system for moving innovations from university labs into the private sector. The Kauffman Foundation is working to help unclog what is a very complex system by exploring ways to create a more open web with multiple links among university researchers, entrepreneurs, and other key players who support and can facilitate turning discoveries into products and services that improve our lives.

Barriers Public Universities Had to Confront

• Ethics Laws: Reform State Ethics Laws to Allow Faculty Entrepreneurs to Participate in Economic Development Programs • Equity: Revise State Constitutions and State Statues to Allow Universities to Hold Equity in Start-Up Companies • New Financing Methods for Labs/Equipment/Incubators: Create New Vehicles to Finance Technology Incubators and to Develop • New sources of technology office financing and venture financing; endowments, state programs, and university programs • Create Alternative Technology Intermediary Organizations or Affiliated Foundations to Facilitate the Business of Technology Commercialization in a Public Arena: TEDCO in Maryland • Changes pushed by leadership at Governor or University President level

Governors Policy Position regarding Fed Labs

07/20/2005 National Research, Development, and Technology Policy 4.7 Improve the Technology Transfer Performance of Federal Laboratories Governors recognize that small businesses and the related investment capital industry have been the source of most technological innovation and all of the job growth during the past 25 years. Federal laboratories spend $25 billion annually in

research and development but under perform in terms of technology

transfer. State-sponsored technology transfer programs have successfully transferred research and development into commercial activity.

Aldridge NASA Commission on Alternative Lab Management

Recommendation 3-3:

The Commission recommends that NASA Centers be reconfigured as Federally Funded Research and Development Centers to

enable innovation

, to work effectively with the private sector, and to

stimulate economic development

. The Commission recognizes that certain specific functions should remain under federal management within a reconfigured Center.

June 2009

GAO

United States Government Accountability Office

Report to Congressional Committees

TECHNOLOGY TRANSFER Clearer Priorities and Greater Use of Innovative Approaches Could Increase the Effectiveness of Technology Transfer at Department of Energy Laboratories

G A O

Accountability*Integrity*Reliability

GAO-09-548

August 8, 2005 Print Issue

In-Q-Tel: The CIA’s Silicon Valley Bridge

The CIA’s venture capital investment arm is regarded as a success, but it remains largely unstudied. Other government agencies looking to start their own VC wings should learn from the accomplishments—and shortcomings—of In-Q-Tel.

-----------------------------------------------------------------------

Is a ‘spin-in’ technology firm a good model for spinning out technology? And which fed labs have legal authority to create an In-Q-Tel model?

Federal Laboratories Initiatives in Current Legislative Climate

Office of Public Private Partnerships Innovative Partnerships Program

A 21

st

Century Land Grant Act for Federal Laboratories

• The US is facing global technology competition and the federal lab segment of our economy is too large to ignore.

• US universities have undergone sweeping changes in past 25 years to help make US more competitive through technology commercialization, venture $, research parks/incubators, start ups • US labs need to be able to recruit the nation’s best scientists • US laboratories have not been given the budgetary, regulatory or legislative authority to connect with the private sector • The mid-Atlantic region, especially, has much at stake given preponderance of government-owned, government-operated federal labs in area, which have the least flexibility of any federal labs

Four Initiatives in Federal Lab 21

st

Century Land Grant Act

1) Create Programs to Allow Scientists to Connect more closely with Academia and Private Sector through government sponsored programs 2) Develop New Legal, Budgetary and Administrative Structures to Assist Federal tech transfer offices to commercialize technology 3) Create public/private partnerships for federal lab equipment and land use by private sector and allow federal labs more opportunities to compete for other government work 4) Create omnibus federal lab partnership and technology commercialization statute by repealing, reforming and re-enacting federal laws and implementing regulations

1) Human Capital in Federal Labs

• Current Conflict of Interest Rules Restrict Federal Researcher Involvement with the Private Sector and Academia • Need to make Government Service attractive to young entrepreneurial scientists

Solutions:

• Provide legislative authority for labs to establish Entrepreneurial Leave Policies for all government researchers, not just Department of Energy employees • Create Enhanced Intergovernmental Personnel Act (IPA) Mobility Program for Technology Commercialization based on the Land Grant Extension Model

Presidential Executive Order 12591

[1987]

Facilitating access to science and technology Sec. 3. Technology Exchange--Scientists and Engineers.

The Executive Director of the President's Commission on Executive Exchange shall assist Federal agencies, where appropriate, by developing and implementing an exchange program whereby scientists and engineers in private sector may take temporary assignments in Federal laboratories, and scientists and engineers in Federal laboratories may take temporary assignments in the private sector.

Source: The provisions of Executive Order 12591 of Apr. 10, 1987, appear at 52 FR 13414, 3 CFR, 1987 Comp., p. 220, unless otherwise noted

THE WHITE HOUSE WASHINGTON August 4, 2009 M-09-27 MEMORANDUM FOR THE HEADS OF EXECUTIVE DEPARTMENTS AND AGENCIES FROM: SUBJECT: Peter R. Orszag Director, Office of Management and Budget John P. Holdren Director, Office of Science and Technology Policy Science and Technology Priorities for the FY 2011 Budget EXCERPT: Agency budget submissions should also explain how the agency plans to take advantage of today's open innovation model-in which the whole chain from research to application does not have to take place within a single lab, agency or firm-and become highly open to ideas from many players, at all stages.

Agencies should empower their scientists to have ongoing contact with people who know what's involved in making and using things, from cost and competitive factors to the many practical constraints and opportunities that can arise when turning ideas into reality .

Agencies should pursue transformational solutions to the Nation's practical challenges, and budget submissions should therefore explain how agencies will provide support for long-term, visionary thinkers proposing high-risk, high-payoff research.

2) Technology Capital in Fed Labs

• Federal Lab Technology Transfer offices do not have the resources, legal and administrative flexibility, and leadership support typically enjoyed by university technology transfer offices • Communities are expecting enormous spin outs from federal BRAC R&D related investments in their communities that may not be fulfilled in current structure • States have established intermediary organizations, such as the Maryland Technology Development Corporation (TEDCO), and many universities have research and tech commercialization foundations to more easily take on business of technology development in a government setting • Creation of a federal technology commercialization foundation to hold equity, attract venture talent, accept appropriations, and act as tool to assist technology transfer offices is needed. A Fed-Ted-Co? An In-Q-Tel for all agencies? A Reauthorized Fed Lab Consortium with Expanded Powers and funding?

FLC on Steroids: the Fed Lab Foundation

Federal Lab Foundation: Possible Roles: legal and financial

• • • • • • • • Federal equivalent of Maryland TEDCO, a quasi-public technology development corporation Empower by federal statute to serve as a ‘intellectual property foundation’ for any federal lab desiring its services Assist TTOs in forming start-ups and finding venture and management capital, similar to Go-co’s or In-Q-Tel like organizations Assume transactional risk Accept technology commercialization federal appropriations since FLF would not be competing with parent agency for funding Hold equity on behalf of parent agency Report to Congress on technology transfer activities Broker individual federal researcher services to private companies on a disclosed and transparent process to increase US innovation capacity and discourage ‘brain drain’ from federal laboratories

3) Physical Capital in Fed Labs

• Expand full Enhanced Use Lease Authority (EUL) to allow access to equipment and land for all federal agencies, not just DOD • Develop better data bases of technology, technical expertise, equipment for lease, and other assets, integrated across fed labs • Allow more federal labs to compete for more federal R and D projects [intergovernmental competition] • Physically integrate fed lab space with academic, private and other government sectors on common campuses [Sandi Labs, St. Elizabeth’s DHS project, UM Research Park, etc.]

Integrating Federal and Private R&D Assets: Power of Place/’Science Under One Roof’

Association of University Research Parks The Power of Place www.aurp.net

Secretary of Energy Chu: Energy Innovation Hubs ‘Science Under One Roof’

‘Direct personal contact has been demonstrated by numerous studies to be the most effective way of diffusing technology knowledge’

-Gregory Tassey of the National Institute of Standards and Technology (NIST),

The Technology Imperative,

pg. 68

Jobs Impact of R and D Funding

According to U.S. Department of Commerce, every $1 million in R&D spending generates 36 jobs American Association of State Colleges and Universities:

Policy Matters

, October 2008

4) Federal Transfer Legislation Has Grown Unwieldy Over the Years

Federal technology transfer legislation and policy references take up 94 pages in FLC ‘Green Book’.

Repeal, re-enact and harmonize technology transfer legislation and policy as part of

Federal Labs 21 st Century Land Grant Act

How Do We Lobby for A 21

st

Century Land Grant Act for Fed Labs?

• • • • • Government-owned; government-operated labs (Go-Gos, which predominate in the mid-Atlantic Region ) are in the most inflexible position Executive Branch Agencies can’t lobby the Congress Individual Federal Lab support groups, and BRAC groups, such as the Maryland Army Alliance, or the PAX River Alliance, are important.

Business and state economic development groups, including the Chesapeake Crescent, the new Maryland federal lab committee established by Department of Business and Economic Development, can work with Congressional Delegations on both sides of Potomac to get this done. 150 plus years after Civil War, maybe we can witness Maryland and Virginia Congressional delegations working together

Thank You!

Brian Darmody Associate Vice President for Research and Economic Development 2133 Lee Building University of Maryland College Park, Maryland 20742 301-405-1990 [email protected]

www.onestopshop.umd.edu