Egils Milbergs Executive Director

Washington Economic Development Commission

Olympia, Washington

www.wedc.wa.gov

egilsm@wedc.wa.gov

360-586-5661

Innovation Partnership ZonesBuilding a World Class Innovation Ecosystem

Presentation for :Innovation Awards

The Council of State GovernmentsEdmonton, Alberta

July 19, 2012

1

The Problem We Need to Solve

2WEDC 2.0

A Ten Year VisionMake Washington the most attractive, creative and fertile

environment for innovation in the world by 20203

New Economic Development Model

Traditional Model Innovation Driven Model

Attracting companies Investing in talent, ideas

and infrastructure

Jobs Incomes

Top down development Bottom-up organic growth

Closed innovation Open innovation

Competing regions Collaborating regions

4WA Economic Development Commission

What do we need to do? Progress needed along four dimensions

Intellect

Investment

Infrastructure

International

Emphasize career transition, access to learning

resources and the skills that employers need.

Create innovation ecosystem to foster

new products, start-ups and manufacturing.

Design a 21st century infrastructure, an efficient

regulatory system and align to local objectives.

Grow the global presence of Washington’s business.

5WEDC 2.0

Aerospace

Interactive

Media

Biomedical

District

Clean Tech, Smart

Grid, Biofuels

Defense

Technology

Biotech, Energy, Semi-

conductors, Exports

Wine, Water

Global Health

World’s Largest Innovation Park

Food Processing,

Rail Innovation

Wind, Solar,

Data Centers,

Adv. Mfg.

Marine

Ocean Energy

Agriculture,

Composites

Sustainable

Industries

“Twilight”

Medical

Devices

Financial

Services

Electric Cars

Clean IT

Urban Clean

Water

7

Innovation Partnership Zones

WA Economic Development Commission

• Challenge: lots of innovation assets at the local level, but no coordination.

• Assumption: innovation happens at the grassroots level.

• Solution: identify a consensus vision based on local assets and capabilities and create organizational, leadership structure to coordinate and align local efforts among businesses, ports, higher education, local government, tribes, and other stakeholders.

IPZ

Universities

Community and Technical

Colleges

Private sector businesses

Ports

TribesChambers

Local government

Local development organizations

Other stakeholders

Communit

y colleges

Universities

Tribes

Ports

Local

governmentPrivate

sector Non-

profits

8

Case Study #1: Walla Walla

WA Economic Development Commission

• Zone Objective(s): Water resource management

and viticulture promotion.

• Region is home to more than 100 wineries.

• Sustainable Living Center (SLC) is a new nonprofit

educational tenant of the Water Center.

• Nelson Irrigation Corporation is a private sector

partner that engineers irrigation equipment and

systems internationally and has developed

groundbreaking products for water efficiency

utilization.

• City of Walla Walla

• Confederated Tribes of theUmatilla Indian Reservation(CTUIR)

• ETS Laboratories

• Port of Walla Walla

• Walla Walla County Commissioners

• Walla Walla Valley Wine Alliance

• Nelson Irrigation Corporation

• Walla Walla Watershed Alliance

• Walla Walla Watershed Management Partnership

• Walla Walla Community College (WWCC)

• Training: WWCC’s Enology

& Viticulture Program

includes a two-year, full-time

course of study, designed for

students pursuing careers in

the wine industry.

9

Case Study #2: Tri-Cities Research District

WA Economic Development Commission

• Zone Objective(s): Energy storage, smart grid, and

biofuels.

• 1,700-acre area located in North Richland.

• PNNL as anchor tenant.

Highlights

• Leveraged $155,000 of state capital grant funds with

federal stimulus, port, and City of Richland funds for a

total investment of $2.4 million for infrastructure and

road construction.

• Innovatek, a tenant of the IPZ, has a Department of

Energy Phase Three Accelerant Grant for production of

stand-alone electrical generation fuel cells.

• PNNL received $14.2 million for its role in two biofuels

research consortia funded by the Department of

Energy.

• Includes “STAR Researcher” Brigitte Ahring. Dr. Ahring

is the Battelle Distinguished Professor of Chemical

Engineering and serves as the director of the Center

for Bio-products and Bio-energy for all WSU campuses.

• City of Walla Walla Confederated

Tribes of the

• (WWCC)

• Port of Benton

• Columbia Basin College

• Benton Franklin Workforce

Development Council

• Pacific Northwest National

Laboratory (PNNL)

• YAHSGS LLC

• Western Sintering Co., Inc.

• Science Applications

International Corporation

• Moravek Biochemicals, Inc.

• Isoray Medical

• Innovatek, Inc.

• Areva NP

• Surgical Implant Generation

Network

• Energy Northwest

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Case Study #3: Grays Harbor Sustainable

Industries IPZ

WA Economic Development Commission

• Zone Objective(s): Green and sustainable industries

• Received $1 million at the time of designation in

2007 to build the lab and incubation space and

leveraged with a 2010 federal Small Business

Administration (SBA) grant ($427,500), allowing for

acquisition of a 20,000-square-foot building on port

property.

• IPZ branding helps port’s efforts in leveraging assets

and attracting new businesses.

Highlights

• Establishing a regional partnership to capture

industrial byproducts as resources and share

research and development efforts among a group of

companies.

• Grays Harbor Paper generates green paper

byproducts that have been used by Paneltech in the

manufacturing of their products.

• Port of Grays Harbor

• Grays Harbor Public

Development Authority:

Satsop Development Park

• Grays Harbor College

• Grays Harbor EDC

• Pacific Mountain Workforc

• Development Council

• Imperium Renewables

• Paneltech International

• Wishkah River Distillery

Regional Innovation Clusters Evolve

Growth

Transformational

Nascent

Emerging

None or few firms

Growth potential

Few to many firms

Fast growth

Some linkages

Accelerated

collaboration

Many linkages

Attraction of firms

Many nodes

Dense linkages

Region to Region

Next generation

STARSIPZs

R&D

EIRsPatents

Incubators

Innovation

Assets

Tax

Incentives

Talent

Gap

Funding SBIR

11WA Economic Development Commission

Going Forward

1. Relationship capital is the secret sauce

2. More focus on local vision, plans and metrics

3. Operational funding is critical

4. New financing resources and tools e.g. TIF

5. Aligning agency programs to local priorities

6. “Porous” boundary definitions

7. Leveraging assets between IPZs

8. Web based collaboration platforms

9. Best practices clearinghouse

10.Rigorous evaluation of outcomes

WEDC 2.0 13

14

September 2012 celebrates

Commerce & Innovation Economy

www.thenextfifty.org

WEDC 2.0

Thank You!

WEDC 1.1 15

Metrics

IPZ Annual Reporting

• Number of trained workers added to state workforce as a result of training provided within IPZ

• Number of potential business sites added (commercial and industrial building developed, redeveloped or newly occupied) attributable to IPZ innovation, research, and commercial application

• Number and type of other assets developed (to retain, grow and attract business)

• Dollar value of infrastructure and other investments completed

• Evidence of commercialization of IPZ research (licenses, patents, trademarks, etc.)

• Descriptions of research being conducted within the IPZ and potential commercial applications

• Other reasonable performance criteria that may be developed by Commerce.

IPZ Performance Metrics

• Additional investment– Private sector investment

– Investment from outside the zone

• Job creation / retention– # of jobs created

– # of jobs retained within wage range

• Increased commercialization activity– $ increase in sales or sales orders associated

with IPZ research

– # of licenses, patents, applications for innovation research

• Increased collaboration and/or community partnerships

– Zone-hosted conferences, creation of incubator, visiting scholars

• Unique criteria– Formation of an advisory board

– Incorporation as a non-profit

– Launching and IPZ website

• Creation of tailored curriculum

WEDC 2.0 16