- The U.S. government is seeking to turn metro areas in middle America into the next hot spots of tech innovation with an initial $500 million investment.
- The Department of Commerce announced its first notice of funding opportunity for the Regional Technology and Innovation Hub program, known as Tech Hubs.
- The hope is that the infusion of funds will help regions across the country become essential centers of innovation and create more well-paying jobs across a greater swath of the nation.
The U.S. government is seeking to turn metro areas in middle America into the next hot spots of tech innovation with an initial $500 million investment.
The Department of Commerce announced Friday its first notice of funding opportunity, or NOFO, for the Regional Technology and Innovation Hub program, known as Tech Hubs. It kicks off the process for eligible groups around the country to apply to be designated as Tech Hubs. That designation gives them the chance to take advantage of the funds to make their regions attractive places for entrepreneurs and technologists to live and work.
"America leads the world in technological innovation. But the sad reality is that our tech ecosystem is extremely concentrated," Commerce Secretary Gina Raimondo told reporters on a briefing call Thursday, noting that 80% of U.S. venture capital money is invested in the San Francisco Bay Area, the Northeast and Southern California. "There's so much more potential for tech innovation all across the country. In the U.S. we have the best research institutions in the world. That's indisputable. And frankly, many of them are in America's heartland, far from the coast."
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Congress authorized $10 billion for the program between fiscal years 2023 and 2027, of which $500 million is available to be distributed this year. Under the current funding opportunity, a total of $15 million in planning grants will be made available to applicants designated as Tech Hubs. Later this year, the Department will seek to award five to 10 designated Tech Hubs grants of $50 million to $75 million each to help build out capacity in their region, according to a Department of Commerce official.
President Joe Biden requested $4 billion be made available for Tech Hubs in next year's budget.
Eligible applicants are groups made up of at least one entity from each of the following categories: a higher education institution, subdivision of local or state government, industry or firm in relevant tech or manufacturing field, economic development group, and labor organization or workforce training group.
Under the statute, Tech Hubs should focus on a specific set of key areas of technology, which include artificial intelligence, robotics, natural disaster prevention, biotechnology, cybersecurity, energy efficiency and more. The department must designate at least 20 Tech Hubs under the law.
The hope is that the infusion of funds will help regions across the country become essential centers of innovation and create more well-paying jobs across a greater swath of the nation.
"President Biden is so clear on one point, which is that everyone in America deserves a fair shot at economic opportunity, no matter where they live, and they shouldn't have to move in order to get a good job," Raimondo said. "Nobody should have to leave their family or support system or network to move to New York or San Francisco just to get a good job."
Raimondo also framed the program as an important investment in U.S. national security. She pointed to the nation's current efforts through the Chips and Science Act to invest in domestic semiconductor manufacturing, which became an urgent bipartisan priority when the pandemic highlighted how fragile the computer chip supply chain was. That's because most advanced chips are not produced in the U.S., and the industry's dependence on chips made in Taiwan makes the supply chain especially vulnerable, given tensions with China.
Raimondo said the U.S. "ceded our leadership on manufacturing and innovation for this critical technology. And now we're in the difficult position of having to catch up."
The "Tech Hubs program is about making sure that doesn't happen again, ensuring we stay ahead of the curve on other essential technologies, from quantum to artificial intelligence to biotech," she said.
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