Rhode Island may not become the first state with a border-to-border wireless broadband network after all.
The R.I. Wireless Innovation Networks project is one of two signature initiatives to build Rhode Island’s science and technology sector that were not funded in the fiscal 2008 budget approved by state lawmakers last week, amid the tightest budget crunch in memory.
The Business Innovation Factory had asked the state to guarantee $28 million in private loans to finance the RI-WINs project, an effort to create the nation’s first statewide broadband wireless network.
The budget – approved by the House on June 15 and the Senate on June 19, and approved again over the governor’s veto on June 21 – also did not earmark $600,000 for the creation of the IT and Digital Media Center that economic development officials wanted to build in the American Locomotive Works complex.
The R.I. Economic Development Corporation will continue to pursue both initiatives, though each will obviously have to be modified, said Saul Kaplan, executive director of the quasi-public agency.
“We’re disappointed, but undeterred,” Kaplan said. “Both of these programs are central to our innovation agenda, and creating a higher-wage economy here in Rhode Island. We recognize that it’s a very, very difficult budget year and not all the programs could be funded.”
BIF launched the RI-WINs initiative in 2005, saying that blanketing Rhode Island with wireless broadband coverage would help spur technological innovation and attract new companies to the state. The project completed its pilot phase earlier this year.
The $28 million that BIF requested would have covered the initial buildout of the network, plus financing costs and expenses for the first three years of operations, after which RI-WINs would be expected to turn a profit.
Because the General Assembly was not comfortable with the state making a loan guarantee, BIF will seek a higher level of private sector participation in the project and look for alternative ways to finance RI-WINs, including a few proposals already under development, Kaplan said.
“The main concern that was raised in most of the discussions was that they would like to see the private sector play a more substantive role in helping us achieve the vision, so that’s exactly what we’ll do,” Kaplan said.
The IT and Digital Media Center, which the EDC hoped to build this year in 30,000 square feet of space directly above its own offices at ALCO, would have provided subsidized incubator space for about seven to 15 technology startups and offered programming for all companies in that sector.
Proponents said the center eventually would attract out-of-state companies to Rhode Island, raising the state’s profile as a regional and national center for IT and digital media innovation in a manner similar to what occurred in the 1990s along the Route 128 corridor in Massachusetts.
The EDC, which currently holds a one-year option to develop the space, will determine the best way to build a program that supports and grows the state’s IT and digital media community, Kaplan said. The program could still be built in a smaller space at ALCO or elsewhere, or it could be launched without a physical space, he said.
The decisions not to fund the RI-WINs and technology center projects were among several tough choices made by legislators, who needed to close the gap on an estimated $350 million deficit.
Among other controversial measures, the General Assembly also eliminated a 3-percent increase in state education aid, removed 2,400 children from state-subsidized child care, froze the capital gains tax at 1.67 percent rather than phasing it out as planned, decided to save money by sending 17-year-olds to the state’s adult prison and cashed in the last of the state’s remaining tobacco settlement bonds.
Gov. Donald L. Carcieri has said he will veto the budget – which he said fails to fix structural deficits that will rear up again next year and beyond – but the overwhelmingly Democratic legislature is expected to override his veto.
The General Assembly did not completely pull the rug out from under the governor’s ongoing work to grow the state’s technology industry. It renewed the $100,000 operating budgets of both BIF and the R.I. Science and Technology Advisory Council, which were created in 2004 and 2005, respectively, to help turn Rhode Island into a regional hub for the life sciences, information technology and other research-based industries.
Lawmakers also renewed their $1.5 million investment in STAC’s Research Alliance grants, which fund collaborative projects of disparate players in the state’s research and development community.
This year the grants are supporting 32 scientists from 15 research organizations across Rhode Island, working on projects that include an effort to develop a new generation of prosthetic limbs; another to create cheaper biofuels from genetically modified switchgrass; and a third to build new, high-tech autonomous underwater vehicles.
