Research Parks and Innovation Districts (Blog Post)

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Blog Post
Title Research Parks and Innovation Districts (Blog Posts)
Author Taylor Jacobe
Content status Published
Publication date
Notes Published in May 2017
©, 2016

Google Doc

Message from Larry Peterson

It was a pleasure meeting with you last week in Houston! I am in Boston at MassChallenge this afternoon, where it is way too cold.

Following up on our lunch conversation, I wanted to provide several things:

· A list of typical financial tools for research parks and innovation districts

· A well-regarded Battelle study on research park design, and the NAS report on research parks (attached). As we discussed, research parks and innovation districts are slightly different implementations (greenfield vs. brownfield) of the same paradigm.

· A model letter of support for MassChallenge

· An offer of an introduction to Kevin Byrne at TUFF

Attached is a model letter of support and several example letters. We would appreciate one from you and/or Rice in support of MassChallenge.

The common financial tools for research parks and innovation districts are layered to form a “capital stack.” There much be numerous types of equity, debt and incentives to address all the needed design parameters.

Planning grants may be available through EDA in partnership with the regional Council of Governments (in your case, the Houston-Galveston Council).

Equity commonly comes from New Markets Tax Credits (NMTC), Texas Enterprise Fund, HUD community development grants (through CDBG or direct), EDA grants, foundation grants, participation in Empowerment/Enterprise and other “Zone” designations, tax relief through federal and state mechanisms (e.g. state 313 program).

Common debt instruments include the Texas Product Development and Small Business Incubator Fund, a large variety of tax credit bonds, such as: · Build America Bonds

· Recovery Zone Economic Development Bonds

· Qualified School Academy Zones (QZABs)

· Qualified School Construction Bonds (QSCBs)

· Clean Renewable Energy Bonds (CREBs)

· Qualified Energy Conservation Bonds (QECBs)

Plus a variety of municipal bonds, including several types of revenue bonds and private activity bonds. In addition, tuition bonds can be used to building campus facilities for workforce education-focused activities.

Some of the major state incentive programs include:

· Skills Development Fund

· Texas Enterprise Zone Program

· Governor’s University Research Initiative

· Texas Capital Fund Infrastructure / Real Estate Programs

· State Sales and Use Tax Exemptions

· Franchise Tax Deduction for Business Relocation

· Chapter 380 /381 Economic Development Agreements

· Texas Leverage Fund

· Event Trust Funds

· Bonds: Sales Tax, Exempt-Facility and Tax-Exempt Industrial Revenue

· Defense Economic Adjustment Assistance Grant Program (DEAAG)

· Texas Military Value Revolving Loan Fund

· Texas Product Development & Small Business Incubator Fund (PDSBI)

· Research & Development Tax Credit

· Texas Economic Development Act

· Ad Valorem/Property Tax Exemption

· Renewable Energy Incentives

· Permit Assistance

· Moving Image Industry Incentive Program

· Cancer Prevention and Research General Obligation Bonds

· In-State Tuition for Employees

There is an organization with whom I have worked, the University Financing Foundation (TUFF) in Atlanta, headed by Kevin Byrne, former AURP president. They are a non-profit that has created the capital stack for numerous research parks, including Atlanta’s Technology Square. I have talked to Kevin several times over the years about research park opportunities in Texas, and I think he could be a tremendous help.

Finally, as we mentioned, a huge part of successful research park / innovation district design is social factors engineering. The realm of social network theory provides the basis of “minimizing social distance” that provides the functional basis of why successful agglomerations work – resources are rapidly accessible as needed, represented by the speed of navigating complicated social networks (e.g. for acquiring capital, finding customers or key hires, etc.) I can probably identify some other experts to assist in these factors for your concept.