Prior to 1880, the state's economy was primarily dependent on agriculture, but in 1990 farms, agricultural services, forestry, and fisheries contributed only 1.7% to the Gross State Product, with principal crops of peanuts, cotton, corn, tobacco, soybeans, and pecans. Georgia's largest agribusiness is its poultry industry (broilers and eggs), which produces an estimated impact of $3 billion annually. The twenty-first largest state in area, Georgia's climate and soil are very good for cultivating timber, primarily Southern pine, for lumber products and pulpwood, and annual revenues from timber exceed $1 billion. The only significant mining is in kaolin deposits in the central and eastern parts of the state.

Georgia's manufacturing base is diverse, with principal employers being textile and carpet manufacturing, apparel manufacturing, pulp and paper production, and food processing (e.g., poultry products). In addition, transportation industries include several auto assembly plants established in the 1960s, and a large aerospace sector that manufactures military and small civilian aircraft, missiles, and related components. More recently, telecommunications. consumer electronics, and software firms have located in the state, primarily within the Atlanta Metropolitan Statistical Area (MSA). In 1990, manufacturing accounted for 19% of the Gross State Product.

Within the service sector, Georgia has experienced substantial growth in the past three decades, with significant growth in real estate, retail, finance, transportation, health, legal, and business services. The state's interstate highway system, its strategic location (bordering Florida to the south), and Hartsfield International Airport in Atlanta have helped make the convention and tourism sector a major economic contributor, as evidenced by the selection of Atlanta as the site for the 1996 Olympics. Atlanta serves as a regional center for a number of federal government agencies, and there are eleven military bases located throughout the state, together providing over 44,000 civilian jobs.

Georgia typifies the moniker of "Sun Belt" coined in the 1970s for the growing southeast region; its economy has grown steadily for more than fifty years. The basis for this growth is multidimensional and relates to a number of positive attributes, including good soil, climate, water supply (surface and groundwater); excellent infrastructure, especially transportation systems; enthusiastic promotion of economic development by state and local governments; a good public and private university system; low union participation; an attractive tax structure; and a diversity of tourist attractions. Some of the negatives are the public K-12 education system, crime and poverty.

Since the mid-1930s, Georgia has had a statewide economic development planning entity, and in 1963, under Governor Carl Sanders, a formal science advisory commission was created to advise the state's administration and legislature on science and technology issues. Under Governor Jimmy Carter (1971-75), the position of science advisor was created to advise the governor's office, a function that was transferred to policy analysts in the Governor's Office of Planning and Budget in 1975. While Georgia's growth has not relied heavily on science-based policy initiatives, science and technology have long been recognized as essential to industrial development in the state. As early as 1880, emerging from the economic devastation of the Civil War and Reconstruction, Georgia and its communities were promoting industrial development through technology-based initiatives, such as the state-funded Georgia School of Technology (now the Georgia Institute of Technology). However, a formal state science-based development plan was not created until more than a hundred years later with the establishment of the Governor's Research Consortium in 1986.

This case study will briefly address the history of science-based development since 1880, and then examine in greater detail three examples of Georgia initiatives:

1. the Industrial Extension Service established in 1960;
2. the Advanced Technology Development Center established in 1980; and
3. the Georgia Research Alliance established in 1990.

Georgia's Industrial Development History

At the end of the Civil War in 1865, Georgia's economy was in shambles. Antebellum plantation agriculture based on slave labor dominated the state's economy when Georgia joined the Confederacy in 1861 and very little manufacturing existed. ₂ The war effort created some new establishments for the production of war materials (e.g., uniforms, gunpowder), and expanded railroads. However, at the war's end and during the ensuing Reconstruction period (1865-71 in Georgia) the state had to cope with a tremendous loss of capital due to the freeing of slaves and an infrastructure devastated by war. The loss of the plantation-based agricultural system, which has been characterized as very profitable, ₃ left economic leaders seeking alternatives, since it was evident that agriculture alone couldn't stimulate recovery.

In 1871, a U.S. Senator from Georgia, Benjamin Hill suggested in a speech that the South should look to the Northeast, for example, in planning industrial growth to revive the economy, suggesting a vision of a "New South." This creed was taken up enthusiastically by businessmen and newspapermen throughout the state, with the most famous spokesman being Henry W. Grady, editor of the Atlanta Constitution from 1879 to 1889. Grady gave a famous speech to the New England Society in New York City in 1886 in which he extolled the value of cooperation between North and South business interests, touting the New South concept of alliances with northern capitalists to develop southern resources and new industry. Until cotton prices dropped substantially in the early 1920s, many Georgia communities employed Grady's New South model by encouraging the establishment of new industrial plants (primarily textile mills) through joint ventures between business leaders, local governments, and often financiers from outside the locality. However, Georgia's industrial development during the period 1870-1920 is seen by some historians as a re-establishment of an elite planter class, led by patriarchal mill owners who paid low wages, fought to keep labor unions out of the state, and disenfranchised black workers. ₄ During this same period state and local governments supported racial segregation and low taxes, resulting in sustained poverty and inadequate public education. The state's 1877 constitution gave virtual autonomy to local communities to interpret and enforce laws, with a county-unit voting system that assured rural interests prevailed and black residents were virtually excluded from the political process. By 1930, Georgia's per capita income was only 50% of the national average.

Industrial Development Since 1930

President Franklin Roosevelt's New Deal policies of the 1930s were, in large part, aimed at the prevailing economic conditions in Georgia and the rest of the South. New labor laws, such as those setting a minimum wage, restricting child labor, and defining a forty-hour work week, had a profound effect on Georgia's manufacturing firms, which had been accustomed to operating with little government regulation or investment. During the same time, Governor F.D. Rivers (serving 1937-41) launched a "Little New Deal" in Georgia, an ambitious program aimed at changing the way the state invested in economic development. Rivers created the first post-Reconstruction state planning board to coordinate projects and plan economic development, but he left office in disgrace because of a financial crisis brought on by opposition of the old-line political establishment to his progressive programs. ₅ The Rivers administration represented the first departure from the state-level policies that had successfully maintained a segregated, agrarian society since the 1870s.

During World War II, Georgia benefited from massive federal defense investments in the state that established as many as twenty military installations (eleven are still operating), creating new ranks of skilled manufacturing workers who were trained in the state or migrated from other regions. Much credit for this infusion of defensive spending is given to two U.S. legislators from Georgia, Representative Carl Vinson, Chair of the House Armed Services Committee, and Senator Richard Russell, Chair of the Senate Armed Services Committee during and after the war By 1948, Georgia's per capita income had grown to 66% of the national average and, for the first time, employment in manufacturing surpassed that in agriculture.

During the 1950s and 1960s, Georgia's government at all levels was preoccupied with first stubbornly protecting the racially segregated society of the previous 150 years, then with learning to accept federal desegregation decrees. Unlike other major southern cities, desegregation in Atlanta was relatively peaceful and ultimately supported by economic development leaders as good business. Once this transition was essentially complete, the business climate in the state became much more attractive to businesses that did not rely primarily on low-wage labor. ₆ For example, in the late 1960s, a group of businessmen created a new industrial park- Technology Park- in northeast Atlanta, aimed at attracting a number of technology-based manufacturing and R&D firms.

Science-Based Development Since Reconstruction

In Georgia, as in most other states, the period 1870-1900 was an important one for the creation of science-based development initiatives After the war, traditional farming methods in Georgia changed dramatically and agricultural interests promoted the idea of a government agency dedicated to expanding and disseminating science-based knowledge to the state's farmers. In 1874, the Georgia Department of Agriculture was created to provide farming expertise and regulation of fertilizer and seed sales. In 1888, Georgia established a state agricultural experiment station, operated with a federal grant of $15,000 per year, provided under the 1887 Hatch Act. ₇ Since Georgia's economy at the time was primarily dependent on agriculture and the number of farms was increasing rapidly after the destruction of the plantation system, the first effort at science-based development was in support of agriculture. However, the states initiative was limited to the federal programs of education and research that were available to all states.

In concert with the New South theme and independent of federal initiatives, Georgia embarked on a science-based development initiative in the early 1880s that resulted in the establishment of the Georgia School of Technology (Georgia Tech) in 1885. Unlike other public Agriculture and Mechanics schools created in conjunction with the federal 1862 Morrill Act that created public land-grant universities, Georgia Tech was established by the state and the City of Atlanta in order to facilitate the New South vision of a flourishing industrial base. The prevailing policy environment that spawned a technological school to train residents to operate and manage new industries was typified by the International Cotton Exposition held in Atlanta in 1881. Modeled on other great industrial expositions of the period, such as the 1876 Centennial Exposition in Philadelphia, the Cotton Exposition celebrated the promise of technology and industry, and helped bring business and government focus to the concept of establishing a new technological school. As the state's only public engineering university, Georgia Tech has served in many instances as a defacto technology agency, and has been responsible for creating and operating several technology-based development initiatives.

Using Universities to Implement Science-Based Development

Shortly after Georgia Tech opened, the federal Hatch Act, passed in 1887, provided annual grants to all states to establish and operate agricultural experiment stations. These stations were set up in conjunction with the University of Georgia's agricultural school to support the advancement of knowledge and methods in farming through experimentation and applied research, and to supplement and strength en instructional programs. The Agricultural Experiment Stations in Georgia have a long and distinguished record of supporting the development of advanced agricultural methods and equipment, and represent an important early manifestation of joint federal/state science-based development. In 1914, the federal Smith-Lever Act. ₈ created the Cooperative Extension Service which extended the benefits of research from the stations and agricultural school to farmers throughout the state. The model of the agricultural experiment stations and the extension service were later adapted at Georgia Tech to create an analogous program for assisting Georgia industry with engineering and technology expertise.

After the creation of Georgia Tech, agricultural experiment stations, and cooperative extension service, state support for science- and technology-based development was limited to modest investments in the university system of Georgia including:

• In 1919, the state created the Engineering Experiment Station (EES) at Georgia Tech as an analog to the Agricultural Experiment Station at the University of Georgia, a land-grant university. However, the EES was not funded until 1934, when $50,000 was appropriated to support Georgia Tech research.

• In 1956, Governor Marvin Griffin established the Industrial Development Branch (ID B) of the EES with a $50,000 grant in order to develop new industry and increase productivity in established industries.

• In 1957, Governor Griffin invested $2.5 million of state cost-sharing funds to match a $750,000 National Science Foundation grant to build an experimental 5 MW nuclear reactor on the Georgia Tech campus, to sup port the nascent nuclear power industry. In the same year, the General Assembly created the Georgia Nuclear Advisory Commission (abolished in 1963 with the creation of the Georgia Science and Technology Commission). The next year Griffin funded a $13 million science center
• In 1960, Governor Ernest Vandiver gave IDB a $50,000 grant to establish the Industrial Extension Service, a statewide network of Georgia Tech field offices which has grown today to become a national model for industrial technology transfer.
• In 1980, Governor George Busbee created the Advanced Technology Development Center as part of the university system, to incubate new high technology businesses.
• In 1986, Governor Joe Frank Harris created the Governor's Research Consortium as a funding vehicle for new research centers of excellence.

• In 1990, the Georgia Research Alliance (GRA), a consortium of six research universities, was conceived by a group of Atlanta businessmen. In 1991, Governor Zell Miller and the General Assembly began funding the GRA as an independent organization with a mission to foster economic development by developing and leveraging research capabilities of the research universities in the state.

In summary, Georgia's New South enthusiasm for industrial development stimulated a state investment in a technological university in the early 1880s, but a fiscally conservative political agenda focused on maintaining the status quo prevailed until about 1956, when Governor Marvin Griffin started a series of modest state investments in science and technology-based industrial development programs. Thereafter, every governor has made science-based development a component in his economic development policy, using the state university system as the vehicle for policy implementation.

Policy History: Business, Government, and Universities as Partners

The creation of Georgia Tech in 1885 was a response to the New South creed that held that industrial development in the state and region would be facilitated by a public technological school modeled on similar schools already established in the northeast U.S. (e.g., Worcester Polytechnic Institute, and the Massachusetts Institute of Technology). The business-led industrial "boosterism" characterizing the New South movement invariably sought successful models to emulate in other regions and countries; the International Cotton Exposition was modeled on expositions in other major U.S. cities, the Engineering Experiment Station was modeled on the successful agricultural experiment stations established by the U.S. Department of Agriculture with the Hatch Act of 1887, and the industrial extension service at EES was modeled on the cooperative extension service for agriculture, established by the Smith-Lever Act of 1914. Herein lies an important aspect of Georgia's science-based development policy: forced to recover from the economic devastation of the Civil War, the business and governments in the South elected to "borrow" development concepts from more prosperous regions while emphasizing the south's comparative advantages (e.g., abundant resources, low-wage and non union labor). Georgia, unlike other southern states, chose to create a single public technological university separate from the state's land-grant (i.e., A&M) university and assign to it a technology-based development agency status. As the examples hereafter illustrate, Georgia has cast its universities in a central role for conceiving and implementing science- and technology- based development initiatives.

Another important policy element in Georgia's history is the role that Atlanta and its business community has played in science-based development since 1871. A relatively new city (established in 1847 as a railroad junction), Atlanta has been progressive and very active in seeking new technology-based industry. This is due in part to the city's focus on transportation systems and industries, first as a rail hub, later as a major airport, and currently as a telecommunications enclave. However, many analysts attribute Atlanta's economic success to its generations of New South enthusiasts that have consistently created a hospitable environment for business, demonstrated over the past 115 years by the 1881 International Cotton Exposition and its focus on new technology and industrial growth and in 1996 by hosting the Olympics, with an emphasis on international linkages and advanced telecommunications.

Industrial Extension Service: Technical Help for Existing Businesses

The Georgia Institute of Technology has often acted in the role of a science and technology agency to implement new state and federal technology-based development programs. Since its creation, Georgia Tech has been recognized by Georgia's governors, legislatures, and the economic development community as a focus for science and technology programs aimed at further developing the state's industrial base In 1919, the Georgia General Assembly established the State Engineering Experiment Station at Georgia Tech to:

aid in the promotion of engineering and industrial research, and for the more complete development and utilization of the natural resources of Georgia, and for the encouragement of industries and commerce, and insuring the public welfare of the people of Georgia consistent with more progress and preparedness. ₉

The Engineering Experiment Station (EES) was unfunded until 1934, when a grant from the legislature, through the university system, facilitated its start-up. The EES was "Georgia's first agency designed to aid in a comprehensive development of industry," and was charged to be "a focal point for the progressive technical thought of industry." ₁₀ Starting in 1934, the EES was funded by the state to compile industrial statistics and conduct studies to identify new industrial opportunities and assist existing industries. In 1955, Dr. Ken Wagner, a member of the social sciences faculty at Georgia Tech, approached Governor Marvin Griffin with a proposal to create a program that would provide fact-based research to support statewide industrial development efforts. Governor Griffin made a grant of $50,000 to fund Wagner's program, which was set up as the Industrial Development Branch (1DB) within EES. Wagner was an entrepreneurial visionary who quickly built IDB into a large staff of analysts, engineers, librarians, and economists who worked with development leaders throughout the state to conduct research and training for Georgia communities trying to attract new industry. Typical studies included identification of industrial sites and community infrastructure needs; market and labor force analyses; identification of industries that were most suitable for a community; community economic profiles; and assessments of new technologies for Georgia industries.

In 1959, Wagner's group conducted a needs survey of 800 small Georgia manufacturing firms that revealed that a technical and management assistance service for small businesses would yield large benefits, relative to the needed investment. ₁₁ Using these results and IDB's insights from four years of intensive evaluation of development opportunities, Wagner wrote A Preliminary Blueprint for Industrial Development in Georgia in 1960. Based on the report's recommendations, Governor Ernest Vandiver gave IDB a $50,000 grant to establish an Industrial Extension Service (TES), a statewide network of 1DB field offices staffed by professional industrial development specialists who could draw upon the scientific expertise and information resources resident at Georgia Tech. The IES grew slowly to eight one-professional field offices in 1979, then grew steadily to its present (1996) configuration of 16 offices, 55 professionals, 35 support staff, and 15 Georgia Tech students. In 1993, the IES won a major contract from the U.S. Department of Commerce to substantially expand its staff and technology transfer services. The program is currently recognized as a model of effective technology transfer both in the U.S. and internationally. ₁₂

The Policy Initiative: State and Federal Support for Small Firms

Coming from the technological successes of World War II, the 1950s were a watershed for science-based development in the U.S. In a recently agrarian Georgia, where industrialization was seen as a key to economic parity with the rest of the nation, the mid-1950s were a time of experimentation in economic development and the IES allowed Georgia Tech to focus its technology-based resources on the attraction of new industry. The IES was the most far-reaching technology-based development experiment of the period made possible by an entrepreneur on the Georgia Tech faculty and the support of two governors (Marvin Griffin and Ernest Vandiver). Further, the focus of the IES on technology transfer was sharpened by the State Technical Services program operated by the U.S. Department of Commerce from 1965 to 1971. This federal program funded industrial technology transfer pro grams in qualifying states, and the IES was the vehicle used in Georgia. In fact, Ken Wagner reported in 1965 that the federal program was modeled on Georgia Tech's Industrial Extension Service. ₁₃

There were multiple policy stimuli for creating the IES:

1. Georgia's desire to attract new high-wage industry and promote competitiveness in its existing industries.
2. The 1959 1DB study of the needs of small manufacturing firms in Georgia, a study sponsored by the U.S. Small Business Administration that showed that technical assistance to small firms would yield large benefits relative to the government investment needed to set it up.
3. Support from the governor for expanding the role of Georgia Tech in state-wide economic development.
4. The prevailing federal policy environment that supported science- and technology-based development, demonstrated by the State Technical Services program.

The IES has operated for over thirty-six years, transferring new technology and providing technical problem-solving services to Georgia industries, currently conducting over 2000 consultations annually.

Advanced Technology Development Center: Creating High Technology Companies

During the 1970s, a number of industrial technology outreach programs were created within the EES, including the Industrial Energy Extension Service, Trade Adjustment and Assistance Center, Agricultural Technology Research Program, Technology Utilization and Commercialization Center, and several industry-specific applied research projects. In the late 1970s and early 1980s, EES received as much as $20 million per year from federal agencies to conduct new technology research, demonstration, and transfer programs. One of the EES leaders in developing and managing these programs was Jerry Birchfield a Principal Research Engineer who directed many of these efforts. The planning impetus for a new program to create technology firms came from the private sector, and Birchfield was responsible for its ultimate implementation.

In 1978, William C. Norris, founder of the computer firm Control Data Corporation, wrote a report to the Assistant U.S. Secretary of Commerce for Science and Technology, entitled, "Recommendations for Creating Jobs Through the Success of Small, Innovative Businesses." After retiring from Control Data, Norris established several high-tech business incubators in U.S. communities that cost-shared the ventures, and he carried the cause of creating small firms based on science and technology to the federal, state, and local governments. At about the same time (1978), an influential group of Georgia Tech alumni known as the Committee of Twenty, started what became known as the Technology Business Development Project, with the goal "to increase Georgia Tech's service to the state of Georgia and the business community by utilizing Tech resources to aid and expand high technology businesses in Georgia." ₁₄ The project had five components:

1. technical assistance for small high-tech firms;
2. a venture capital effort;
3. a magazine publicizing Georgia Tech research;
4. a small business incubator; and
5. a comprehensive study of technology transfer to small businesses.

Like Norris' concept of community-based incubators, the Committee of Twenty's project viewed the incubator as a business venture that would allow Georgia Tech to help new firms start up and grow in exchange for stock or royalty income from the new businesses. The alumni group enlisted the aid of Georgia Tech President Joseph Pettit, a former Dean of Engineering at Stanford University and research associate of Fred Terman, founder of the Stanford Industrial Park in California's Silicon Valley. Pettit in turn asked Birchfield to pursue the planning of the ATDC as a private/public initiative.

In 1979, Birchfield received a National Science Foundation (NSF) grant to plan an Advanced Technology Development Center (ATDC) under the auspices of the NSF Innovation Centers program. Using the results of the NSF project, he approached Governor George Busbee to start funding the ATDC effort, and in fiscal year 1979-80, Georgia Tech received $85,000 through the state budget to complete the planning. When Birchfield approached him, Busbee had recently been to Europe on an industrial development foray and was impressed with the technology-based industry he saw there. Until he left office in 1983, Busbee was a strong advocate for the ATDC, committing discretionary funds to create the initial incubator facilities in an old school building, and establishing a line-item budget for the program in the university system budget. His successor, Governor Joe Frank Harris, also supported the program, as did a number of influential legislators. In 1985, using a combination of state and private funds, Phase I of the new ATDC facility was completed and in 1986, Phase II was opened. Although Birchfield's original financing plan called for equal shares of support from state (through budget appropriations), federal (through an Economic Development Administration grant), and private partners, the federal funding never materialized. As a result, the state committed to fund two-thirds of the facilities cost, and the Georgia Tech Research Corporation (GTRC), a not-for-profit corporation that is the exclusive agent for Georgia Tech research, supported the remainder of the debt with industrial development revenue bonds. The rent income goes back to GTRC to retire the bonds and today the state continues to fund ATDC operation as a line-item in the state budget, with a current annual budget of $2 million

Through 1993, the ATDC has "graduated" twenty firms from the incubator and currently has an additional thirty-six member firms. The estimated impact of these firms in 1993 was $200 million in annual revenues and 1,500 employees. The estimated total economic impact ATDC firms had in the state was $290 million and 5,000 jobs in 1993.

The Policy Initiative:
Business, Government, and University Support for New Technology Firms

The ATDC was conceived during a period of intense national focus on stimulating innovation and new technology-based businesses. The administration of President Jimmy Carter undertook several major policy initiatives focused on industrial innovation, and the National Science Foundation created its Innovation Centers program during the late 1 970s. In this environment, business entrepreneurs such as William Norris promoted local industrial development based on creating and nurturing small high-tech firms. At Georgia Tech, influential alumni who were also Atlanta businessmen, parlayed the university's reputation as a key institution for stimulating technological industrial development in Georgia and convinced Tech's administration to pursue a new technology business development program. Jerry Birchfield, who had been successful in starting a number of industrial assistance pro grams in the Engineering Experiment Station, was tapped to be the leader of the program and to build the coalition of state, federal, and private interests to make it happen.

The ATDC was a "bottom-up" initiative, with the initial concept coming from Georgia businessmen who recognized Georgia Tech's potential as a technology-based development agency. (Two of the members of the Committee of Twenty, John Hayes and Ben Dyer, were early high-tech entrepreneurs who started Peachtree Software in 1977.) Jerry Birchfield facilitated the startup of the center by selling the idea to Governor Busbee, who supported the center both financially and politically. Busbee's successor, Joe Frank Harris, also provided needed support for creating the ATDC incubator in conjunction with the Georgia Tech Research Corporation, a firm whose directors are executives from technology firms.

Georgia Research Alliance: Investing in the Economic Future Through R&D

In 1984, Atlanta became a late entry in the competition to site the new Microelectronics and Computer Consortium (MCC), a major high-tech facility that eventually was built in Austin, Texas. As a key participant in the effort to recruit MCC, Governor Joe Frank Harris developed an enhanced awareness and under standing of the potential for science-based development. As a result, he established the Governor's Research Consortium in 1985 as an R&D investment program to establish major research centers of excellence at Georgia research universities. From 1986 to 1990, a number of centers were funded, including ones at the University of Georgia (Advanced Computational Methods Center in 1985, Life Sciences Center in 1986), Georgia Tech (Microelectronics Research Center in 1986, Manufacturing Research Center in 1988, Institute of Paper Science and Technology in 1988), and Emory University (Rollins Research Center in 1988). Typically state funds were used to fund buildings and equipment on state campuses, with the participating universities committing to attract additional sponsored research funding. For example, the Microelectronics Research Center was built with $15 million of state funding, with Georgia Tech committing to provide an additional $31.8 million in research funding over the first five years of operation.

The investments made by the Consortium, like those made by many other states in the 1 980s, established first-class research facilities but put no funding into recruiting research personnel. Recognizing that research capabilities needed investments in addition to buildings, a group of prominent Atlanta businessmen conceived the Georgia Research Alliance (GRA) in 1990, an election year. The GRA concept emphasized collaboration and cooperation among the state's research universities, in the model of Research Triangle Park in North Carolina. This emphasis required that the state's flagship research universities, Georgia Tech, the University of Georgia, and Emory University embrace the GRA as an appropriate model for science-based development. Thus, the business group promoting the GRA enlisted the presidents of these three universities at an early stage, with the understanding that other research universities would join the Alliance later. In 1990, when Governor Harris could not run for a third term, both Democratic (Zell Miller) and Republican (Johnny Isakson) candidates were approached by those promoting the GRA, and both adopted the concept as part of their respective economic development pro grams Zell Miller was elected in November and restated his support for the GRA.

By the end of 1990, the Alliance was expanded to include three other universities, and shortly after his inauguration, Governor Miller brought the stare into the Alliance.

The Board of Trustees for the GRA was set up with membership consisting of twelve chief executive officers of Georgia-based businesses, and the presidents of six Georgia research universities (Georgia Tech, University of Georgia, Emory University, Medical College of Georgia, Georgia State University, Clark Atlanta University), each with one vote. The current board members are listed in the appendix. The alliance was created as a 501 (c)3 corporation, with the governor serving as an ex-officio member of the board. Business contributions and university assessments fund its operations. State funding was first appropriated for GRA research investments in fiscal year 1993 (July 1, 1992-June 30,1993) at the level of $15 million. This appropriation was used to fund three Eminent Scholar positions and to invest in upgrading and modernizing research laboratories in the state research universities.

As conceived by Governor Miller and the rest of the board of trustees, the Alliance's mission is to make strategic investments in R&D capabilities at the member universities. To date, state funds have been invested in recruitment of distinguished researchers (Eminent Scholars), upgrading/modernizing research facilities (equipment purchases), and purchasing new equipment and instrumentation as cost-sharing for proposed federal R&D contracts. For example, in 1993, a renowned researcher form IBM was recruited to Georgia Tech's faculty as a GRA Eminent Scholar. The researcher then used GRA equipment funds, together with equipment donations from IBM, for required cost-sharing in order to win a National Science Foundation grant to establish an Engineering Research Center in Electronic Packaging. The total value of this program is $40 million over three years, of which the GRA has provided $1.055 million.

The Policy Initiative: A Coalition of Business, Government and Universities

The 1985 competition for the Microelectronics and Computer Consortium, and Atlanta's loss of it to Austin, was a "wake-up call" for Georgia's governor and the Atlanta business community. While Georgia had successfully recruited technology- based firms from other regions and countries, the MCC was viewed as the kind of fundamental R&D capability that could help attract new science and technology-based industries. With this new perspective on science-based development, Governor Harris commissioned a consultant to evaluate the state's needs for developing a credible research capability. The resulting report indicated that Georgia needed to invest in both research infrastructure and research capabilities. ₁₅

In response, Governor Harris created the Governor's Research Consortium a program that addressed the state's infrastructure need by building a number of centers of excellence on state university campuses during the period 1986-1990. One of the reasons for this investment approach was that new research centers could be built with long term financing through the state Building Authority, thereby amortizing the capital investments over twenty years. However, these investments in "bricks and mortar" did little to add to the state's corps of R&D professionals and Atlanta's business leaders believed that more direct investment in research capabilities was needed.

The business leaders conceived the Georgia Research Alliance as an opportunity to promote science-based development to a new governor and assured the proposal would get favorable consideration by lobbying both candidates prior to the election. Once in office, Governor Miller gave enthusiastic support to the Alliance, success fully guiding the funding initiative through the legislature. ₁₆

The joint support of the presidents of Georgia Tech, the University of Georgia and Emory University was critical to demonstrating that the three universities could cooperate, making the proposal more credible to the gubernatorial candidates and later the legislators voting on the funding. This is significant because prior to 1986, the university presidents had been disinclined to pursue such cooperative efforts. However, new presidents were installed at both Georgia Tech and the University of Georgia after 1986 and an explicit charge to both from the University System Board of Regents was that interuniversity cooperation was expected. The Alliance was touted as an initiative that heralded a new era of cooperation among the state's research universities, and three other Georgia universities were added in recognition of the need to politically and financially support all the state's research strengths.

The current funding mechanism for GRA represents an important policy feature of the initiative, in that it develops the support necessary to sustain the state's investment. Every January the Alliance sends out a request for proposals to Georgia universities and colleges, with stipulations on what type of investments GRA will make (e.g., Eminent Scholars, equipment). GRA enlists private sector reviewers to help evaluate the proposals received and GRA staff works with the member universities to achieve a consensus for a set of investment recommendations. These recommendations are taken to the full board of trustees, and a state budget request is derived from the board's action, which is then submitted to the governor: The governor's recommendation for new state funding is submitted to the general assembly in January with the governor's annual budget. Approved funding is available to GRA on the following July 1, at the start of the new fiscal year.

Now in its sixth year of operation the GRA is being critical reviewed by the governor state legislators, economic developers, and business interests throughout the state. One concern is that the GRA universities are all located in the northern third of the state, with four (Georgia Tech, Emory, Georgia State, and Clark Atlanta) in Atlanta one (University of Georgia) in Athens, 60 miles northwest of Atlanta, and one (Medical College) in Augusta, 120 miles east of Atlanta. Legislators representing regions outside of Atlanta want assurance that the state's investment in GRA will benefit their districts. In response to these concerns, GRA leaders have developed more state-wide representation by adding business executives from outside the metro Atlanta region to the board of trustees. GRA has also broadened it focus by emphasizing economic development benefits from its investments in communities other than Atlanta.

Georgia's Science-Based Development: A History of Partnerships

Since the end of the Civil War, Georgia's development policies have recognized a role for science- and technology- based initiatives. Beginning with the International Cotton Exposition held in Atlanta in 1881, there have been a number of business, government, and university collaborations that put a science and technology focus on industrial development. Each of these participants has been essential for the development and implementation of programs, and each recognizes the need for support from the other two. As a result, Georgia's science-based development policies, while not large in scope, have been largely successful and in some cases have served as models for other states. The nature of the participation by each sector is addressed in the following sections.

The Role of Business Leaders

As Atlanta was struggling to recover from the Civil War and Reconstruction, its business leadership was inspired by the compelling oratory of Henry Grady, who evangelized about the promise of the "New South." Alrhough Grady was a newspaper editor, he was an active business investor who was counted among the members of Atlanta's business leaders. In 1880, Grady took up the cause of holding the International Cotton Exposition in Atlanta, as a project that coincided perfectly with his "New South" idea. ₁₇ The next year, the idea of a state polytechnic college was first proposed in a Macon, Georgia newspaper editorial. Eventually, the Georgia legislature approved funds for a new school and Atlanta business leaders put together a winning proposal to locate the new Georgia School of Technology in Atlanta, in spite of a strong bid to co-locate it with the state's land grant university, the University of Georgia. ₁₈

Since the opening of Georgia Tech as a college to prepare the state's residents for industrial growth, Atlanta business leaders have consistently displayed enlightened leadership in supporting science- and technology-based development. The Advanced Technology Development Center was initiated by a group of Atlanta businessmen who were Georgia Tech alumni and who believed technology-oriented firms figured prominently in Georgia's industrial future. The Georgia Research Alliance was also conceived by Atlanta business leaders who sought to improve the state's R&D capabilities. These business-led initiatives illustrate the importance of having progressive (e.g., New South) business attitudes that plan for the future.

The business environment in Atlanta has spawned science- and technology- based development for the past 116 years. In its position as the state's capitol, the city's leaders have successfully influenced state legislation and policy initiatives that promote New South ideals of technology and industrialization. Atlanta's elected delegation to the general assembly does not wield disproportionate political power because legislators outside Atlanta have considerable influence on the political process. However, the Atlanta business community dominates the business economy in the state and represents a powerful lobbying group, with leadership including executives from banks and utilities headquartered in Atlanta.

Atlanta's influence in science-based development is self-perpetuating, because new initiatives are born of earlier ones. For example, creating a successful technological university resulted in a cadre of alumni who are instrumental in conceiving and lobbying for new legislation and state investments. This "critical mass" of science and technology entrepreneurs is an important aspect for building on successful policies.

Business leaders in Georgia communities outside of Atlanta have also played an important role in shaping initiatives, such as the Industrial Extension Service, which has always focused on assisting industry outside the Atlanta metropolitan area. The 1959 survey the Industrial Development Branch conducted of small manufacturing firms throughout Georgia was the basis for starting the IFS and possibly helped influence the federal State Technical Services program for state efforts to transfer advanced technology to industry. The longstanding power of rural interests in Georgia's legislature makes it politically expedient to extend the benefits of science-based development policies throughout the state, even if resulting programs are headquartered in Atlanta. This is evidenced by the fifteen IFS regional offices located in communities outside Atlanta, the ATDC satellite offices in several communities outside Atlanta, and the fact that GRA investments focus on a statewide economic benefit.

The Role of State Government Leaders

Georgia's science-based development policies have been supported primarily from the governor's office, beginning with Governor Alfred Colquitt (a former Confederate general) chairing the committee responsible for planning the International Cotton Exposition in 1880. The state Engineering Experiment Station was created in 1919 with the support of both federal and state legislators, but no funded until 1934. While Governors E.D. Rivers (1937-41) and Ellis Arnall (1943-47) promoted progressive New South agendas, new programs were limited by clashes with entrenched political foes. Not until Governor Marvin Griffin (1955-59) did Georgia begin to utilize its university system to expand science-based development policies. A formal science and technology advisory function was first created under Governor Carl Sanders (1963-67), with the creation of the Governor's Commission of Scientific Research and Development in 1965. The science and technology policy responsibility later became part of the formal planning function within the governor's Office of Planing and Budget (OPB), created in 1974 by Governor Jimmy Carter (1971-75). Governor George Busbee (1975-1983) funded and was a strong advocate for the ATDC. In 1985, the OPB, under Governor Joe Frank Harris's leadership (1983-91) commissioned a formal evaluation of how Georgia could best invest to stay competitive in the recruitment of technology-based firms, and the resulting report led to the establishment of the Governor's Research Consortium. Most recently, Governor Zell Miller (1991 to present) has expanded and refined previous science-based programs by involving the state in the newly created Georgia Research Alliance.

Georgia's governors and legislatures have always been fiscally conservative and, until 1986, when the Governor's Research Consortium was first funded, investments in science-based development have been modest. The TES and the ATDC were originally funded with discretionary funds from the governor's office, outside the legislative budget process. However, these two programs now have annual operating budgets within the larger university system budget. The Governor's Research Consortium and the Georgia Research Alliance are the first formal science-based development programs in the state's history.

The principal political backing for new initiatives has been the Governor, but the initial planning and concepts for the TES, ATDC, and GRA came from business leaders and/or entrepreneurs within the university system. This coalition of business, government and universities has characterized Georgia's science-based development policies and programs since the 1880s and appears to be viable for the near future.

The Role of Universities

The establishment of Georgia Tech in 1885 as a technological university planned and funded by the state (i.e., outside the Morrill Act land-grant funding), and creation of the agricultural experiment station, started with federal funding, were the first examples of Georgia's science-based development model. Subsequent programs, such as the state Engineering Experiment Station and the Industrial Development Branch within the EES, have been assigned administratively to Georgia Tech. The Advanced Technology Development Center, while administratively assigned to the university system, is located on the Georgia Tech campus and operated by Georgia Tech faculty. However, with the 1990 creation of the Georgia Research Alliance, a new entity was created outside Georgia Tech and the university system. The GRA model, a 501(c)3 corporation led by a coalition of business, government, and university executives with crucial financial support from the state, is one that assures a coalition of private, public, and academic interests that conceive, direct, and implement science-based development throughout the state.

Georgia has chosen to utilize its public and private research universities as a de facto science and technology agency for the purpose of implementing science-based development policies. This model assumes that universities are willing and capable of operating programs that must effectively interface with business and economic development interests in Georgia. This model has been effectively demonstrated with the Cooperative Extension Service operating in every state, typically by a public land-grant university, to extend university expertise and services to farmers. In Georgia and several other southern states (e.g., Tennessee, North Carolina), the agricultural extension model has been adapted for providing science and technology services to industries in the state. The success of the Industrial Extension Service at Georgia Tech has helped to validate the model and now all Georgia universities (as well as other colleges and technical schools) are expected to make service and inter actions with the state's business community an integral part of their missions.

Conclusion

For more than 110 years, science-based development in Georgia has been recognized as an effective strategy for assisting the industrialization of the state. While always fiscally conservative, the stare has invested in science and technology programs such as Georgia Tech, the Industrial Extension Service, the Advanced Technology Development Center, and the Georgia Research Alliance- because Georgia's business community has strongly supported them. Beginning in the 1880s with individuals like Henry Grady, Georgia's business leaders have figured prominently in conceiving of new science and technology programs to be operated in conjunction with public universities. As a result, strong linkages between the business community and state universities have been forged, providing an effective vehicle for implementing and sustaining new science-based development initiatives. This partnership of business, government, and universities has provided strong science-based infrastructure that helps Georgia attract new industry and develop its existing industrial sector. The past success of this model suggests that the state will continue to use it in the future.

Notes

Note 1: Suzanne Lindsay and Marie Libbey, "Gross Product in Georgia and the Southeast, 1977-1990." Back.

Note 2: In Georgia in 1860, the value of products manufactured in the state was $16 per capita and the capital invested in manufacturing was $10 per capita. In the same year, the estimated value of slave property in the stare was $396 per capita. (Source: Numan V. Bartley, The Creation of Modern Georgia (Athens: University of Georgia Press, 1990), p.24.) Back.

Note 3: In Time on the Cross, Fogel and Engeran present an extensive economic analysis of slavery, concluding that it was a profitable system in 1860. Back.

Note 4: See Gavin Wright, old South, New South: Revolutions in the Southern Economy Since the Civil War (New York: Basic Books, 1986). Back.

Note 5: Bartley, Creation of Modern Georgia, p. 192. Back.

Note 6: See James Cobb's Industrialization and Southern Society, 1877-1984 (Lexington: University of Kentucky Press, 1984). The southern strategy of recruiting branch plants to the region in the late 1950s and 1960s was adversely affected by concerns of prospective firms that quality public schools and other state services would not be available in states practicing racial segregation Back.

Note 7: Several States (e.g., New York, Connecticut) had operated agricultural experiment stations since the 1840s. The Hatch Act recognized the efficacy of the station model and appropriated funds for operating stations in all states. Back.

Note 8: Georgia's Senator Hoke Smith, a former governor of the state, was a cosponsor of the Smith- Lever Act. Back.

Note 9: Georgia Code, Acts 1919, p.357. Establishing State Engineering Experiment Station at the Georgia School of Technology Back.

Note 10: From an archival document, Orientation of the State Engineering Experiment Station of the Georgia School of Technology signed by Harry W Vaughan, Acting Director, April 16,1934. Back.

Note 11: J.L. Lewis, Identification and Evaluation of Problems and Needs of Small Manufacturing Management. Report of study sponsored by the U.S. Small Business Administration, 1961. Back.

Note 12: Office of Technology Assessment, Making Things Better: Competing in Manufacturing,1990. Back.

Note 13: Ken Wagner's report on the Industrial Development Division in the Annual Report of the Director, Georgia Tech Engineering Experiment Station, 1964-65. Back.

Note 14: Article in the Georgia Tech Alumni Magazine, "Alumni Project to Assist High Technology Businesses," Georgia Tech Alumni Association, June 1978 issue. Back.

Note 15: McKinsey and Company, Inc., Creating a Catalyst for Georgia's Future, 1985. Back.

Note 16: Georgia's annual zero-based budget process is initiated by the governor's office submitting a comprehensive state budget to the general assembly. New initiatives are included as improvements to the previous year's (continuation) budget, while existing programs are refunded every year, usually with increases for inflation. The University of Georgia was established in 1785. Back.

Note 17: Franklin H. Garrett, Atlanta and Environs: A Chronicle of Its People and Events (New York, Lewis Pub. Col, 1954), Vol.11, page 29. Back.

Note 18: Robert McMath et al., Engineering the New South (Athens: University of Georgia Press,1985), pp. 15-30. Back.

References

Bartley, Numan, V. The Creation of Modern Georgia. 2nd ed. Athens: University of Georgia Press, 1990.

Cobb, James C. Industrialization and Southern Society, 1877-1984 Lexington: University of Kentucky Press, 1984.

Combes, Richard S. Origins of Industrial Extension: A Historical Case Study in Georgia. Master's Thesis, School of Public Policy, Georgia Institute of Technology, 1992.

Fogel, Robert W & Stanley L. Engerman, Time on the Cross: The Economics of American Negro Slavery. Boston: Little, Brown, 1974.

Governor's Commission for Scientific Research and Development. Report of Governors Commission for Scientific Research and Development, Atlanta, 1965.

Henderson, Harold P, and Gary L. Roberts, eds. Georgia Governors In an Age of Change: From Ellis Arnall to George Busbee. Athens: University of Georgia Press, 1988.

Lewis, J.L. Identification and Evaluation of Problems and Needs of Small Manufacturing Management. Report of study sponsored by the Small Business Management Research Grant Program, U.S. Small Business Administration, 1961.

Lindsay, Suzanne A. and Marie McGarth Libbey. "Gross State Product in Georgia and the Southeast, 1977-1990." Georgia Business and Economic Conditions 54, no.1. Selig Center for Economic Growth. University of Georgia, 1994.

McKinsey & Company, Inc. Creating a Catalyst for Georgia's Future Report for Governor Joe Frank Harris, 1985.

McKinsey & Company, Inc. Building Foundations for Georgia's Growth in Science and Technology Report prepared for the Georgia Research Alliance and the Governor of Georgia, 1991.

McMath, Robert C., Ronald G. Bayor, James E. Brittain, Lawrence, Foster, August W. Gibelhaus & Germaine M. Reed. Engineering the New South: Georgia Tech 1885- 1985. Athens: University of Georgia Press, 1985.

Wagner, Ken. A Preliminay Blueprint for Industrial Development in Georgia. Report of the Industrial Development Division, Georgia Tech Engineering Experiment Station, 1960.

Wright, Gavin. Old South, New South: Revolutions in the Southern Economy Since the Civil War New York: Basic Books, 1986.