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Investing in Innovation (again): What Obama's 2011 State of the Union Means for Grants

Feb 15

Written by: Grants Office, LLC
Tuesday, February 15, 2011  RssIcon



To understand what Obama's general remarks on these areas for reform and investment really mean, it is instructive to look towards the American Recovery and Reinvestment Act of 2009 (ARRA), otherwise known as the Recovery Act or the Stimulus, that included many of the same priorities discussed below.

Energy. One of the top priorities for many public agencies, including school districts and municipalities, is the need to become more efficient not just in their provision of public services, but also in their basic operational costs. A key program in the ARRA, the Energy Efficiency and Conservation Block Grants (EECBG) provided funds to public agencies to implement energy-saving technologies - including those focused on enhanced efficiency or alternative energy sources. With most federal funding in the energy sector focused on research, development, or commercialization, there is a void of funding opportunities like the EECBGs that fund the actual implementation of such technologies. The money that does fund it is administered at the state level and often subject to budget cuts or outright elimination as states face over a collective $100 billion shortfall this year. A revised national energy policy that aims to reach Obama's goal of 80 percent clean energy usage by 2035 will likely require additional supports similar to EECBGs that allow public agencies to pursue "greener" options for keeping the lights on.

Education. Obama most clearly emphasized his intent to use his track record of progress through the Recovery Act to inform his approach to education. Obama specifically cited the $4 billion grant program, Race to the Top, as a key motivator for states to achieve the kinds of reforms that have long remained relegated to policy papers - including teacher tenure reform and higher academic standards.

"Race to the Top is the most meaningful reform of our public schools in a generation. For less than 1 percent of what we spend on education each year, it has led over 40 states to raise their standards for teaching and learning," Obama stated when discussing education.

With a long-overdue reauthorization of the Elementary and Secondary Education Act (ESEA) and relatively close policy positioning between Obama and the newly empowered Republicans, education may be the likeliest target for bipartisan compromise. Expect in any new version of the ESEA to be grant programs such as a modified Race to the Top and Investing in Innovation, as well as other supports for teacher professional development. Given the success of Race to the Top in achieving reform even before awarding any grants, it is likely these new and extended grant programs will continue to remain competitive, rather formula-based.

Infrastructure. Similarly to energy and education policy, much of what Obama's State of the Union addressed could be traced back to the Recovery Act with highlights in the areas of transportation and expanded access to broadband. Obama noted that new economic prosperity would rely in large part on building the "fastest, most reliable ways to move people, goods, and information" throughout the country and world.

Grantseekers may recall this included multi-billion dollar Recovery Act grant programs such as high-speed rail and the broadband technology opportunities and broadband initiatives programs. The administration has already launched its effort to build on the promise of high-speed rail, calling for $53 billion to be spent over the next five years on developing a new network of lightning-fast trains to America. Obama has also pushed for developing an infrastructure bank composed of public and private capital that would award funds to projects based on merit (similar to grant programs), rather than by earmark or formula. The Universal Services Fund, which administers programs meant to help expand internet access (such as E-Rate), is likewise moving towards implementing changes to its programs.

President Obama reiterated much of what he has already made clear his administration considers priorities for the 21st century - a new paradigm of energy creation, distribution, and consumption; a reformed education system that continues to produce the best and the brightest; and a focus on (literally) rebuilding and reimaging America.

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