R&D investment

Little noted in Gov. Angus King’s proposal for Part II of the next biennium budget was money crucial to this region. His plan to increase funding for research and development from $4 million to $10 million annually deserves both praise and support, and the best part is that it may not cost Maine a penny.

In fact, the investment could become more than revenue-neutral. It’s a potential money-maker for state government, in addition to employing people, using local goods and services and expanding important high-tech industries. Consider, the University of Maine received $3.2 million this year from the state for R&D. It has used that money to leverage $26 million in outside grants, and, with more than two months still left in its fiscal year, it is awaiting word on several more.

The direct and indirect state taxes on that total of $29.2 million, according to UMaine economist James H. Breece, are roughly $2 million. Add to that increased levels of property tax — which saves the state money in General Purpose Aid to Education — and the taxes paid by startup businesses helped by the research and state has the fastest payback on an investment in its economic portfolio.

The governor’s proposal matches one of the priorities of the Legislature’s Joint Select Committee on Research and Development. Give the University of Maine System — the educational institution — seed money and it will benefit students with more professors, new lab space and cutting-edge research; give UMS — the economic engine — the money and let it expand opportunity statewide. Both are happening with the modest $4 million investment from the last legislative session. The $10 million proposal will let it grow that much faster.

One key to the state’s contribution, which is made through the Economic Improvement Fund, is that it be made in the base budget and not as something added on at the end. Maine is just starting to get into the habit of investing its most important asset — the brain power of its residents — and should make a commitment to significant, consistent funding that will allow scientists and engineers to be confident of gaining financial support as they explore new areas of research.

If lawmakers had any doubt about the importance of making an investment in research that will encourage new businesses or existing businesses to grow, they need only look at the activity at two traditional Maine businesses: Dexter Shoe announced layoffs this week and Sherman Lumber Co. was forced to close. Certainly, many traditional businesses dependent on Maine’s natural resources will continue to be a major part of the economy, but unless the state decides to invest in areas such as high-tech industries, the alternative to those jobs will be low-level service work. Maine has plenty of this kind of employment already.

If it wants highly productive, high-pay careers in the future, now is the time to spend on research and development. The $10 million proposal is a good start on a long-term proposal. UMaine has demonstrated that it can use the money effectively. All it needs now is continued legislative support.