• WisBusiness

Monday, November 30, 2009

Let individuals decide on consuming raw milk

By Chris Danou
When it comes to your own personal consumption, who decides? Is it you or the government? Individuals should make their own personal consumption choices, not government entities.

Recently, i have spent lots of time discussing the issue of raw milk sales with other legislators, my staff, lobbyists around the Capitol, and most importantly my constituents. I have had the privilege to replace Rep. Barbara Gronemus, the independent Democrat who held this seat for 26 years and had a history of supporting the right to sell raw milk.

For me and for my constituents in the 91st Assembly District, the issue boils down to the question of when regulation goes too far.

The farm community in Wisconsin is hurting. Milk prices are unusually low and the economy is slow to recover from one of the worst economic downturns we have seen since the Great Depression.

If farmers in my district are able, through their own ingenuity, to produce a product which the free market dictates a demand for, who am I as a legislator to tell them no? After all, it is my job to represent their best interests. By supporting the sale of raw milk that is exactly what i am attempting to do.

After all, the government allows for the sale of raw eggs, beef, and poultry. This is not to mention that we allow for the sale of such frowned upon products as liquor, cigarettes, and tobacco. Why should the sale of raw milk be treated differently?

My bill in support of raw milk sales does several things. First, it requires a Grade-A permit which provides current state guidelines to oversee the sanitary handling and storage of raw milk.

This bill will also provide for a raw milk permit which can be used to keep the government regulations designed for large national corporate food processors and handlers from being applied to and becoming excessively burdensome to the local farmers who operate on a much smaller scale and stay local.

Consumers will be able to buy local, developing a trusting relationship with the farmer, which will ultimately strengthen the "safety factor."

Finally, my bill will also provide some level of protection for the farmer from individuals who may be opportunists and try to take advantage of the current misconceptions regarding the safety of raw milk.

Raw, or unpasteurized, milk has been a staple of Wisconsin and American diets for many generations and it has been consumed for many years without negative health effects by the vast majority of these families. Twenty-five states currently allow for the sale of raw milk, including our neighbors in Minnesota.

Wisconsin, the Dairy State, currently has no exception for the sale of raw milk directly from farms to willing, informed consumers.

This bill simply allows those who want the choice to drink raw milk to have the right to purchase this product directly from Wisconsin family farms. Many consumers are asking for access to raw milk and milk products for health reasons and strongly believe they should have the freedom to legally purchase the healthy food of their choice. Sen. Kretlow and I have drafted a bill which will do just that.

-- Danou, a Democrat, serves in an Assembly district that includes Trempealeau and Buffalo counties and portions of Jackson, Pepin, and Pierce counties. Prior to serving in the state Assembly, Danou was a police officer with the Onalaska Police Department. He received his bachelor's degree from UW-Madison and master's degrees from UW-Stevens Point & American University.


Wednesday, November 25, 2009

What is business all about?

By John Imes
When it comes to Wisconsin's business climate, critics' obsession with the tax code and regulations not only hurts the state's image, but it doesn't tell the real story. Wisconsin is a leading destination for business.

Our state's talent pool, superior work ethic and quality of life, the research and development capabilities of the UW System, fast-growing export markets, not to mention abundant clean water, clean air, reliable energy supply, good roads and infrastructure -- all of those position Wisconsin for success in a high-end economy.

And with new economic development tools like the Enterprise Zone program, we're able to compete and work with companies like Mercury Marine, Oshkosh Corporation and Republic Airways. All have recently announced plans to retain or add jobs and build new plants and equipment in Wisconsin.

Still, the toll from the Great Recession of 2008-2009 will require new directions and bold and persistent actions.

One area where Wisconsin is poised to be a global leader is the emerging green economy that includes renewables and biofuels, energy efficient manufacturing, high-speed rail, and green urbanism. Wisconsin can have a business climate that attracts clean jobs and investment while pursuing our competitive advantage. For example:
  • * New North's work to establish a wind energy manufacturing cluster, Milwaukee's effort to create a hub for clean water technology and the Capital Region's focus on the cutting-edge technologies, greater security and high-paying jobs of the future "bioeconomy" are good examples of key regions helping brand the state as a great place for green job growth.
  • * Tough regulatory climate? Wisconsin's innovative Green Tier law offers a better way for industry and small businesses to make environmental improvements and reduce costs while receiving incentives such as fast-track permitting, one-stop approvals and lower fees.
  • * Wisconsin companies are also leading the response to concerns about climate change. Quad/Graphics, Johnson Controls, Miller Brewing and other innovators are setting goals and making investments in technology, practice and mindset to reduce greenhouse gas emissions. Fast growing Orion Energy Systems of Manitowoc is a leading provider of energy-efficient lighting technologies and other solutions that can reduce energy use by 50 percent or more. And by combining reduced energy use with new sources of clean energy, Wisconsin can dramatically reduce emissions while continuing to add new jobs, growth and investment.
Wisconsin has a great heritage of entrepreneurship -- think Sam Johnson of SC Johnson, Ken Hendricks of ABC Supply and Harry Quadracci of Quad/Graphics -- all Wisconsin originals who had a passion for business, took risks and created thousands of jobs. Who will step up and showcase our state as an innovator and build on that legacy?

The angst over Wisconsin's business climate reminded me of a story Harry Quadracci once told about his early obsession with the tax code and the extraordinary time and effort he would take to find every angle and loophole. After many fits and starts, his accountant called and said he had found the perfect solution; in fact, the company would not have to pay any taxes at all! Harry was very excited to hear this and wanted to know what they needed to do. The accountant said it was very simple -- just make no money.

Quad/Graphics began in 1971 with Harry, 11 associates and a second mortgage on a house. Today, Quad is one of the state's most successful companies with 12,000 employees and over $2 billion in sales. The company also ranks among the best places to work with nationally recognized health and wellness programs, employee stock ownership, on-site child care and recreational facilities, and award-winning environmental stewardship, all incorporated into a fun, high-performance workplace.

As we emerge from the Great Recession, let's not forget all this state has to offer. The leaders who go beyond the bottom line and provide inspiring examples of how business can be wildly successful while taking better care of their customers, employees, communities and our natural environment. Indeed, isn't that what business is all about?

-- Imes is a nonprofit leader and small business owner in Madison and worked for Quad/Graphics for 11 years.


Tuesday, November 24, 2009

Insurance mandate would be job killer for small businesses

By Bill G. Smith
Small-business owners are scratching their heads trying to make sense of the recent healthcare vote in Washington. While American jobs are disappearing and many employers are struggling to make payroll, many on Capitol Hill want to force employers to provide expensive health insurance.

With unemployment now hitting double digits, our elected officials should know better than to impose a job-killing mandate on small employers. It's a bad idea in good times. It's a really bad idea during a recession, and has no place in healthcare reform.

Simply put: employer mandates destroy jobs, and fail to increase choice and competition. A mandate is ultimately a tax on low-income workers, depressing the wages of some and putting others out of work. It doesn't reduce healthcare costs and, instead, substitutes a hefty and direct penalty on the very people struggling to pay for insurance. Furthermore, a mandate does nothing for the unemployed, self-employed or early retirees. This is particularly destructive in the current economic environment when hiring is stagnant and unemployment is climbing over 10 percent.

An employer mandate would do its worst to small business owners and employees. A 2009 NFIB study predicted that an employer mandate could destroy 1.6 million jobs (over five years), around one million of them in small firms.

Mandates lay especially heavy burdens on small firms, increasing their administrative loads and causing additional cash-flow problems, especially during their first five years. A mandate gives employers strong incentives to cut wages, replace full-time employees with part-time workers or machines, and/or turn to foreign outsourcing. By focusing on coverage and ignoring cost, current reform efforts will leave thousands of small employers and their workers on the same road they were when this debate began -- with unsustainable premium increases, new taxes and no relief in sight.

Make no mistake, small business owners need and want reform. To that end, we support market reforms that will increase access to insurance plans and drive more competition and lower costs, not a bunch of new taxes and confusing rhetoric. That's the only way we'll get more Americans covered at lower costs. Small business owners and their workers and their families need the power to negotiate rates, and flexibility in designing plans that give employees the benefits that best suit their needs. An employer mandate gets us nowhere closer to those goals.

Supporting job-killing proposals like an employer mandate is simply not a solution small businesses can live with. It will not help to lower healthcare costs, and it should not be part of any federal reform plan. It's time for our elected leaders to wake up and realize that taxing small businesses with more mandates they can't afford is not "reform" -- it's a death sentence for jobs here in Wisconsin and across the country. Small business owners and their employees deserve better -- especially given how hard many of them are working in this economic climate just to keep their doors open.

-- Smith is director of the National Federation of Independent Businesses/Wisconsin.


Monday, November 23, 2009

Giving thanks for some of the big (and little) things in life

By Tom Still
A partial list of things for which I'm thankful this week:

* For American innovation, ingenuity and inventiveness, three "I's" in a winning team that will rebuild our economy long after the stimulus payments are gone.

* For sports icons like Brett Favre. While many Green Bay fans revile him as a gridiron Benedict Arnold, the fact is that professional football needs household names like Packers' legend Favre. If you root for Tampa Bay, St. Louis, Cleveland or some other faceless franchise at this point in the season, following your local heroes may hold less interest than tracking the redemption of a 40-year-old quarterback.

* For great teachers who inspire kids to learn.

* For the Pilgrims, who celebrated their first Thanksgiving in 1621 after leaving England in the Mayflower and surviving a 62-day Atlantic crossing -- all, it appears, in hopes of getting away from their relatives for the holiday.

* For clean water, which we have in abundance in Wisconsin. Even better, the state has the research, development and manufacturing capacity to help the world's water-poor while building a 21st century industry at home.

* For a political system that can endure or otherwise overcome 2,000-page healthcare reform bills, Sarah Palin fans, Sarah Palin haters, Rush Limbaugh, Keith Olbermann, runaway federal deficits, run-at-the-mouth blogs and run-of-the-mill candidates.

* For newspapers and other true news outlets. Ever heard of the "Google News Room" winning a Pulitzer Prize for reporting on national news? Ever seen a reporter or editor from Bing or Yahoo covering your local school board or city council? You haven't and you probably never will. While the Internet has forever changed how the news is delivered, there's no substitute for local, state and national newsrooms staffed by professionals who actually produce content. The fact you can find news on Google, Bing and Yahoo doesn't mean it materialized out of thin air. Someone had to report, write and edit it.

* For emergency service volunteers. When the back tire on my brother's motorcycle blew out last year on a lonely stretch of West Texas highway, he would likely have died had it not been for the EMS crew in Seagraves, Texas, which quickly triaged his head injuries and put him on a med-flight to a hospital in Lubbock. Those minor miracles are repeated countless times, every day, across America.

* For our military personnel everywhere.

* For Wisconsin farm products such as Door County cherries, Portage County potatoes, Crawford County apples and Marathon County gingseng, mainly because the Chinese seem to think our gingseng is better than their home brew.

* For medical advances that quietly save lives every day. It's important to protect ourselves and our families from threats such as the H1N1 virus, but it's worth knowing that some past threats have faded into history. There hasn't been a case of polio in the Western Hemisphere since 1991. The World Health Organization announced the eradication of smallpox 30 years ago; it killed at least 300 million people in the rest of the 20th century alone. Innovations rooted in Wisconsin have helped to end or control rickets, endemic goiters, anemia, pellagra, skin cancer, bone loss and much more.

* For the connectivity of modern technology, which allows us to stay in touch with our families, friends, business associates and the world through e-mail, text messages, Skype, Twitter, Facebook, Linked In and a myriad of social media yet to be invented.

* For a Thanksgiving holiday that allows us a few days away from all that connectivity.

Happy Thanksgiving!

-- Still is president of the Wisconsin Technology Council. He is the former associate editor of the Wisconsin State Journal in Madison.


Midwest Renewable Energy Association works to facilitate 'green' business practices

By Gregg Hoffmann
As the green business movement gains momentum, trained workers are needed, and some sort of guide through the growing list of agencies and companies involved in it, is necessary.

The Midwest Renewable Energy Association (MREA), located in Custer, outside of Stevens Point, with an office in the Milwaukee area, is trying to provide those and other services to this movement.

MREA recently received a $3.3 million grant from the U.S. Department of Energy for solar installation training. MREA is working with six regional training centers throughout the Midwest to increase capacity for quality solar instruction.

The non-profit organization was one of three entities located in Wisconsin to receive the grants. The cities of Milwaukee and Madison received $600,000 and $370,000 each.

"The MREA is proud to be part of this Wisconsin team that is leading the nation in clean energy production and green job creation," said Tehri Parker, executive director of MREA at the time the grant was announced in late October. "These DOE awards attest to the commitment of our Governor, and local leaders, to build the legislative foundation for projects of this type to thrive."

MREA actually has been at the "green biz" work for quite some time. "The organization was formed in 1990 and grew out of an Energy Fair, which was started by a group of people interested in renewable energy and the environment," said Gina Sinisi, communications coordinator for the MREA. "We've grown considerably since then."

The organization currently has more than 3,200 active members, representing 39 states and three foreign counties. They range from students to business people.

That Energy Fair remains a big part of MREA's program. The event has become the world's largest energy education event. Last year, it drew more than 23,000 people over its three days and featured 275 vendors.

"Our vendors represent every aspect of the renewable, sustainable area, ranging from beekeepers to farmers to construction companies," said Doug Stingle, program director for MREA.

About 200 workshops are offered at the Fair, which is annually held in June, to coincide with the Summer Solstice.

The MREA also is the home for the ReNEW the Earth Institute, a demonstration site and educational facility at the Custer location. The Institute has working renewable energy systems, ranging from wind to solar hot water. The organization also offers more than 120 workshops per year, ranging from one day to two weeks, for homeowners, builders, educators, architects, engineers and others. It is the only organization in the country that offers certification programs for renewable energy site assessors.

On Dec. 3-4, at the Monona Terrace in Madison, the MREA will hold the Solar Thermal '09 Conference. Installers, manufacturers, site assessors, dealers, distributors, state agency representatives and others will be involved.

As a chapter of the American Solar Energy Society, MREA hosts a tour of solar homes and businesses throughout Wisconsin in October.

"Our activities are growing as interest in renewable energy grows," said Sinisi. "We are trying to meet the needs of people involved in various areas."

MREA maintains a database and other informational resources on grants, experts in various areas, technical assistance and other topics. "If we can't help you, we try to refer you to somebody who can," said Stingle.

While training and educational work for those already involved in renewable energy fields has grown, MREA also remains true to one of its original purposes, as an advocate for renewables and protection of the environment.

MREA "promotes renewable energy, energy efficiency and sustainable living through education and demonstration," reads an answer to the "Frequently Asked Question" of "What is the MREA?"

"The MREA is working to protect the environment by educating the public about the appropriate use of natural resources to meet our energy needs."

The listed "vision" of the MREA is to "provide the highest quality renewable energy education and training experiences available. Our programs and services will respond to evolving energy issues, empower people to make wise lifestyle choices and be accessible to the broadest possible audience. We will share our success with other like-minded organizations, recognizing that we are stronger when we all work together for our common goals."

Addressing the last part of that vision statement, Sinisi and Stingle emphasized that MREA works with technical schools and other educational institutions, as well as many other groups, including Habitat for Humanity.

"We have a project in Milwaukee where people who are taking our training work directly with specific homes being built by Habitat for Humanity," Stingle said. MREA also is partnering with Milwaukee Shines to develop Milwaukee as a Solar City.

Funding for MREA comes from a variety of sources, including program fees, grants, donations and independent contracts. The recent Department of Energy grant is a big one for the organization.

Over the next five years, the grant will help provide instruction, installation and curriculum development experiences in solar work to 200 instructors from six Midwestern states. The program will involve 120 instructors in the development, review and use of shared instructional resources.

A national network of solar instructors will share resources and a Midwest Solar Training Network will be formed to promote and advance training programs.

"You can see the momentum building in solar and other renewable energies," Stingle said. "We need trained people ready to go as it continues to grow."

You can find out more about the MREA at www.the-mrea.org or by calling the Custer office at 715-592-6595 or the Milwaukee office at 414-431-0758.

-- Hoffmann has written many columns and features for WisPolitics.com and WisBusiness.com over the years. He writes the GreenBiz column monthly.


Friday, November 20, 2009

Want to be an entrepreneur? Get a business plan now!

By Kevin Reardon
The Ewing Marion Kauffman Foundation released a study in June entitled "The Coming Entrepreneurship Boom" that credits entrepreneurship as a major force that will bring the current troubled economy back to health. The twist, however, is that Baby Boomers -- ranging in age from 45 to 63 -- are expected to be in the vanguard of this movement.

It's a particularly interesting demographic to be leading such a wave of startups, though not a complete surprise. After all, the oldest Boomers are on the cusp of retirement yet unable to retire due to shrunken portfolios. At the same time, they are not exactly the most attractive job candidates in the market due to age. So, many are exploring a third option -- starting their own companies.

Before any firm decisions are made, however, individuals not only need to examine their personal and potential business finances but also the considerable lifestyle changes entrepreneurship can bring. One of the first stops on that learning curve should be to financial and tax experts. A Certified Financial Planning™ professional can give any individual an overview of their financial and personal capacity to make such a new enterprise work. They can also help you understand how to work with tax, estate and investment experts to make sure a new business career is on a sound footing.

Here are some basic strategic and financial steps to follow in starting a business:

Start writing your business plan. There are some people who will tell you that a business plan is necessary for a new company only if you want to borrow or seek investors for a startup. The truth is that sitting down and writing a formal business plan is an excellent way for anyone to examine the idea, structure and money sources for their business concept and, most importantly, the potential of profit from the idea. One of the best places to get the basics of the business planning process is the U.S. Small Business Administration's Small Business Planner website.

Branch out for specific advice. You need not one, but two sets of financial advice when starting a business. The first involves the viability of your business concept. You should understand your business idea inside and out before you launch and what your new company's immediate and long-term cash needs will be. The second set of advice involves your own finances and how prepared you are for what will surely be a major lifestyle transition. Because new business owners frequently underestimate their new business's expenses starting out, they can find themselves funding those business needs out-of-pocket. That means less money for day-to-day living expenses as well as long-term planning for retirement. That's why it's critical to consult a tax advisor as well as a CFP® at the outset.

Get rid of your debts. With the possible exception of mortgage debt, there's very little "good debt" in the life of a businessperson. So while you're researching your business concept and putting together your own financial plan, start cutting back and erasing as much credit card and adjustable-rate debt from your personal life as possible. The continuing credit crisis is making it tough for any business owner -- even experienced ones -- to borrow money at attractive rates. You'll have the most flexibility when you owe as little as possible.

Work on your emergency fund. While it's wise for everyone to have 3 to 6 months of cash set aside for basic living expenses in case they lose their job or face a medical crisis, emergency funds are particularly necessary for new business owners. Startups can be particularly expensive and most businesses are not profitable from day one. Plan a more extensive emergency fund for yourself and for the business as well.

Plan your healthcare and other basic benefits. Automatic benefits are the plus side of working for someone else. When you're working for yourself, you become your own HR department and chances are you won't be able to match your old employer's buying power. If you support a family with these benefits or if you have particular health concerns, you need to price the out-of-pocket costs of such benefits before starting your own company. Depending on the business and the cost of those benefits, you might want to rethink your plans.

Price disability coverage now. You might have short-term disability coverage as part of your current employee benefits, but that will likely end once you quit your job. You should price long-term disability coverage based on your present working salary so you can qualify for the highest possible benefit. Disability coverage is critical for self-employed people since they're their own support system.

-- Reardon is owner & president of Brookfield-based Shakespeare Wealth Management Inc.


Wednesday, November 18, 2009

Myth busters: Why some things you hear about venture capital are wrong

By Tom Still
A record 500-plus people attended Wisconsin's largest early stage investing conference this month and another 250 rubbed shoulders in the same convention hall at the Midwest's largest forum on health care investing. What better time to shatter myths surrounding the investors who crowded both events?

Myth One: "Venture capital is dead." Remember the scene in "The Princess Bride," shortly after the hero Westley (Cary Elwes) is apparently tortured to death by Prince Humperdinck (Chris Sarandon) and Westley's friends bring his body to the cottage of Miracle Max (Billy Crystal)? OK, you probably don't remember that scene unless you've seen the movie a bunch of times, but Miracle Max examines the body and declares Westley is only "mostly dead," which means revival is possible. Had Westley been "all dead," Miracle Max explains, he could have done nothing more than search his pockets for loose change.

So it is with venture capital. Beginning in the third quarter of 2008 and running through mid-2009, venture capital appeared dead but it was really only "mostly dead." As the fourth quarter of 2009 rolls to a close, a number of venture capital firms and venture capitalists are gone forever, but a smaller, wiser corps of private equity investors is emerging from the industry's nuclear winter.

Deals are being made, just not as many. In the boom year of 2000, there were nearly 7,900 venture deals worth $101 billion in the United States. In the bust year of 2009, look for roughly 2,600 worth about $20 billion. Like The Princess Bride's Westley, venture capital may have been "mostly dead," but the loose change in the industry's pockets is slowly being invested again.

Myth Two: "There's only one early stage venture capital firm in Wisconsin." Not entirely so. While Venture Investors LLC of Madison is the state's most familiar seed and early stage VC, specializing in health care and information technology, there are others on the scene. Peak Ridge Capital, with offices in Boston and Canada, has planted a private equity flag in Wisconsin. Kegonsa Capital Partners of Madison functions like a venture capital fund in many, if not most, ways. The NEW Fund in northeast Wisconsin invests in early stage deals, Capital Midwest Fund of Milwaukee is organizing, Triathlon Medical Ventures of Cincinnati has been scouting the state and other angel networks and funds have been known to co-invest with VCs and other angels.

Myth Three: "Venture capitalists won't read my business plan, anyway, so why bother asking?" It depends on how it's pitched. Entrepreneurs who write a crisp executive summary or find a way to make a brief "elevator pitch" often entice investors to read more. Most VCs want to see possible deals -- if for no other reason than to stay current on the market. Of course, there's little sense in sending a software business plan to a biotech VC or vice versa, but entrepreneurs who do their homework can land their plans on the right desk.

Myth Four: "Even if VCs in the Midwest might read my plan, the East and West coast guys won't." Don't assume that's true. Many coastal VCs have learned that high-quality, right-sized deals can be found in cities such as Madison, Milwaukee and elsewhere in the Midwest. Coastal investors such as Steve Burrill, a leader in biotechnology, and Hank Barry, who made a name in software, have told Wisconsin entrepreneurs to quit being shrinking violets. Be politely aggressive, they counsel, and make contact with VCs who might invest in your sector -- regardless of geography.

Myth Five: "Out-of-state VCs won't invest in Wisconsin without a local co-investor." Serial entrepreneurs such as Toni Sikes of Guild.com, Eric Apfelbach of Alfalight and Virent Energy and Ralph Kauten of PanVera, Mirus and Quintessence Biosciences would beg to differ. While it's sometimes the case that out-of-state VCs look for a local partner to help them conduct due diligence on a possible investment, most function just fine on their own -- and may prefer to do so.

Myth Six: "Most venture capitalists care only about biotech or software, and my business is neither." At this month's Wisconsin Early Stage Symposium in Madison, 22 companies of all descriptions -- from sports footwear to a GPS system for dogs -- presented their business plans. The "non-healthcare" track of 11 companies was observed by more potential investors than the healthcare track, which included a number of investors from the companion MidAmerica Healthcare Venture Forum. Your company name need not include "bio" or "genix" in its suffix or prefix to attract potential investors, especially at a time when shorter payback periods are at a premium.

It's not a surprise to most early stage companies that venture capital is still slogging through tough times, with investment returns hard to come by and new money difficult to raise. But as one veteran investor remarked in Madison this month, "I'm starting to believe the light at the end of the tunnel is no longer an oncoming train."

-- Still is president of the Wisconsin Technology Council, which produced this month's Wisconsin Early Stage Symposium and hosted the MidAmerica Healthcare Venture Forum.


Monday, November 16, 2009

Fix the broken insurance marketplace

By Dan Danner
Whether they're young or old, entrepreneurs always have a hunger to come up with the next big idea, or to do something better than anyone else. That's the spirit that lives in each and every small business owner. That's what drives them to create jobs and continue to build our economy.

There are, however, many challenges that new and even well-established businesses face—in particular, the rising cost of healthcare and health insurance. The inability to affect or reduce health insurance premiums from year to year continues to be the greatest challenge for small business owners, along with the lack of competition and choice in the marketplace.

For these reasons, small business should be the focus of the healthcare debate. It's baffling that small business owners need to reiterate why they need reform. They continue to see examples of how big businesses like Safeway and General Mills are doing great things for their workforce, driving down costs, and just want the same. But here's a newsflash: Under current laws and regulations, small businesses can't do it.

So their message is simple: Fix the broken marketplace. For decades, small employers and the self-employed have been forced to bob and weave between the individual and small-group marketplace. These two markets either deny individuals the coverage they need, or they raise rates so high, employers can't afford to keep coverage. Something is wrong with this picture.

The Senate and the House of Representatives have been striving to craft an acceptable healthcare reform bill. As they work, they need to know what's not acceptable to small business owners:

* An employer mandate: Some proposals require employers to offer healthcare to full-time and part-time employees. Research shows an employer mandate could cost 1.6 million jobs, with more than 1 million lost in the small business sector. The greatest effect will be on low-income workers, who will pay through depressed wages and lost jobs.

* A payroll tax: The House would charge a payroll tax of up to 8 percent on all employers with a payroll of $500,000 or more, if they don't provide "qualified" health insurance to their employees. The tax would apply no matter whether the business makes a profit or not.

* A public option: Some bills establish a government-run public option. As advocates for competition and choice, we're deeply concerned that a public option would further compromise the viability of private insurance and eventually would restrict choice to a single plan: the government-run plan.

After 15 years of loudly shouting at Congress about this issue, small business owners should be steaming mad that it's taken this long to get a real discussion going about real reform. Maybe that has something to do with the power and money that comes from the insurance lobby. Maybe now that Congress is seriously engaged, they'll listen to their real constituency, not those who can afford to pad their pockets.

Here's something every voter needs to know: Small business owners need and want reform. To that end, we support market reforms that will increase access to insurance plans and drive more competition and lower costs, not a bunch of new taxes and confusing rhetoric. That's the only way we'll get more Americans covered at lower costs.

Americans in general, and small business owners in particular, should contact their representatives and urge them to pass the reforms that truly help small businesses and their employees

You can follow the latest news and information about the debates here.

-- Danner is president and CEO of the National Federation of Independent Business in Washington, D.C.


Thursday, November 12, 2009

Emerging industry clusters draw interest from state business leaders, academics and policy experts

By Jennifer Sereno
Is water Wisconsin's next major industry?

Business leaders and economic development experts from around the state are making a strong case for the job creation potential of water. They're also looking to wind and even forest products as industries with promise to fuel the state's economic growth in the years to come.

Wisconsin's economy has long been characterized by industry "clusters" -- groups of businesses that rely on similar workforce skills, materials and infrastructure. Success comes when group synergies such as supply and distribution networks, applied knowledge and a regional reputation for quality emerge, creating competitive advantages and access to new markets for the group as a whole.

Our earliest industry clusters -- fur, forestry, wheat and mining -- laid the economic foundation for the rise of the dairy, food processing, manufacturing and other industries that have supported our families and communities until recent times.

At a daylong conference earlier this month sponsored by the Wisconsin Business Council and the Wisconsin School of Business, leaders from industry, academia and government gathered to explore emerging industry clusters that may provide opportunities for job creation and above-average wage growth in the years to come. Industries highlighted at the event included water, wind and forest products.

Barry Grossman, an attorney with the law firm of Foley and Lardner in Milwaukee who specializes in intellectual property law, said Wisconsin's geographic location and technology leadership in the water industry have contributed to a fledgling "cluster'' in the Milwaukee area that has positive implications for the entire state.

How can water translate into jobs?

"There are more than 120 businesses in the water industry in the Milwaukee region now,'' including Badger Meter, a maker of water flow sensors for municipal and industrial applications, Grossman said. In addition to companies like Badger Meter that actually make water-related products or provide engineering and consulting services, Wisconsin also is attractive to companies that use water in their industrial processes.

"We sit on 20 percent of the world's fresh water and when you look at places like Las Vegas and Atlanta ... they are running out of water,'' Grossman said. To help market the region's water resources, Grossman said the Milwaukee Water Council has launched the "WAVE'' program -- short for Water Attracting Valued Employers.

"We've had remarkable success, we've gotten calls from investment bankers (and) we are starting to attract some interest from outside companies,'' he said.

Bill Johnson, president of Johnson Timber Corp. and director of government affairs for Flambeau River Papers and Flambeau River Biofuels, said industries throughout the state stand to benefit from public and private support for a water industry cluster. For example, new water treatment technologies developed in the state could improve the efficiency and reduce pollution for the pulp and paper industry.

Johnson pointed out the synergies of a water cluster and another developing hub of industry: biofuels. Flambeau River Biofuels was recently selected for a U.S. Department of Energy grant totaling $30 million to construct and operate a biorefinery at an existing pulp and paper mill in Park Falls.

The biorefinery will convert materials including forest residuals and agricultural waste into gas, which will be converted into sulfur-free biodiesel transportation fuels. When in full operation, the biorefinery will produce at least 6 million gallons of liquid fuels per year.

The plant also will generate enough heat to sell to Flambeau River Papers, which will make it the first integrated pulp and paper mill in North America to operate without fossil fuels. Johnson said the project proves that Wisconsin businesses possess the skills and vision for world-class innovation.

Those sentiments were echoed by Kim Bassett-Heitzmann, president and chief operating officer of Bassett Mechanical in Kaukauna, who focused attention on the potential for a Wisconsin wind industry cluster. Interest in wind energy is growing worldwide and Wisconsin's traditional strengths in engineering, metal fabrication and composite technology position the state for success.

Beyond becoming a center for wind energy manufacturing and engineering through the leadership of companies such as Bassett Mechanical, Wisconsin also stands to capitalize by converting more of its own energy production to wind-based systems. Currently, Wisconsin ranks 17th in the nation in terms of the wind energy production, but has the potential to increase generation from the current 449 megawatts to 19,000 megawatts (the state's 2009 electric consumption is estimated at about 77,000 megawatts).

As with water and the new forest products cluster, support for the wind cluster from Wisconsin academic institutions will be important in ensuring our work force is prepared for emerging opportunities. Basset-Heitzmann noted that Lakeshore Technical College has 25 new students enrolled in its Wind Energy Technology associate degree program.

The Wisconsin Business Council formed earlier this year in an effort to reinvigorate the economic development dialogue among educational institutions, elected officials and private sector leaders. The group's founding members include American Transmission Co., Anthem Blue Cross Blue Shield, AT&T Wisconsin, Commerce State Bank, Midwest Natural Gas, MillerCoors, Orion Energy Systems and Park Bank.

-- Sereno, former business editor of the Wisconsin State Journal, is a senior manager at Wood Communications Group in Madison. E-mail jenny.sereno@wcgpr.com or call (608) 770-8084.


Wednesday, November 11, 2009

Six reasons a company needs a pandemic response and recovery plan

By Ken Wilson
Earlier this year a new strain of flu emerged and it spread rapidly around the world. It is confirmed in over 168 countries and has had negative impact on the economy of each nation. This new virus 2009 H1N1 (Swine Flu) looked as if it could be a deadly because most humans have no immunity to it. Luckily it was not been as deadly as first feared.

But, the situation is changing. The 2009 H1N1 is starting its second wave in the northern hemisphere and it is not alone. H1N1 is a "friendly" virus that can combine with other influenza and mutate quickly and easily. Today there are five influenza viruses active in the world -- the 2009 H1N1 (Swine Flu), the H5N1 (Bird Flu) and three seasonal flus -- the Influenza A/H1N1, Influenza A/H3N2 and Influenza B.

The World Health Organization (WHO) has confirmed several cases of Tamiflu-resistant H1N1 influenza, with the most recent in July in Canada. The experts do not know how the H1N1/09 will change/mutate between now and the start of the fall seasonal flu season, businesses do need to be prepared for the worst.

U.S. Secretary of Homeland Security Janet Napolitano said "the flu epidemic is likely to be severe, but not as severe as the 1918 pandemic, the world's worst'. Napolitano also acknowledged that there would not be enough pandemic flu vaccine for everyone, at least in the early stages of the flu season. "There will be prioritization of vaccinations", she told members of the USA TODAY editorial board (Aug. 4, 2009).

There are six reasons businesses need to develop a pandemic response and recovery plan in addition to the humanitarian need, they are:

1. The Occupational Health and Safety Administration regulations require that employers take "all reasonable steps" to provide and maintain a safe work environment. If the 2009 H1N1 flu becomes deadly, as in 1918, the company is responsible for the safety of its workers, customers and suppliers. OSHA requires that employers take "all reasonable steps" to provide and maintain a safe work environment.

2. The impact on the availability of the company's workforce could be severe when schools are closed and parents need to stay home. During the 1957 pandemic, a mild Asian influenza pandemic, 25% of the US population became ill.

3. We are in a recession and historically firms have greater chance of failing as we recover from the recession. The financial burdens that unprepared companies will face could multiply because of the impact of a pandemic influenza.

4. Companies need to develop a response plan which provides for the company's financial survival during the pandemic and the recovery period.

5. Estimates illustrate a moderate pandemic influenza could extend the recession by two or more years.

6. Most small and medium sized firms do not have a Pandemic Influenza Response and Recovery Plan in place. These firms employee the majority of people in the United States. Small and medium firms need to be the frontline of defense against the impact of a pandemic on people and the economy.

The 2009 H1N1 Swine flu spread across the globe in a matter of weeks, firms will not have the time to develop an effective response when it returns. A company's pandemic plan should include:

1. A pandemic crisis manager and team: A team responsible for development, maintenance and implementation of the plan.

2. Corporate policies that will be in effect during the pandemic: Decide now on whether the company will change any policy - flexible work hours, telecommuting, travel policies, use of vacation and sick leave, screening people to enter the premises, use of alternative work locations, changes to collective bargaining agreements, etc.

3. Communications plan : A detailed plan to communicate effectively with employees, customers, suppliers, governments and media. Providing clear, consistent and balanced messages based on credible sources and informing them of the steps the company is taking to protect them as the situation changes.

4. Health education plan: A comprehensive employee wellness and illness prevention program is vital for minimizing the transmission within the company. This plan details the steps and strategies to stop/minimize spread of the disease with the company and employee families.

5. Essential function/service plan: The operations needed to keep the company open during the pandemic. The procedures needed to systematically reduce or shut down operations not vital to the core functions are detailed. The objective is to continue operations as long as possible with positive cash flow.

6. Recovery plan: Guided by the essential services plan, systematically resume operations in reverse order based on the company's capabilities and the needs of their customers.

7. Plan testing: Test the plan, train company personnel in its use, and modify the plan as new and more effective responses are identified.

A pandemic response and recovery plan is designed to minimize the disruption to the business, protect employees, maintain a positive cash flow for as long as possible, and to give the company a competitive advantage over those who have failed to plan.

-- Wilson is a certified management consultant, trainer, writer, educator, and speaker with more than 24 years of experience in helping companies grow and prosper. A specialist in the area of business pandemic preparedness, he has helped over 400 companies plan against the impact of pandemics on their businesses. Wilson can be contacted at (763) 476-2216 or by email to ken@wmg-mn.com.


Monday, November 9, 2009

Mercury Marine incentives in line with what others offer to win, keep jobs

By Tom Still
Now that the Doyle administration has revealed the costs of keeping Mercury Marine in Fond du Lac, a predictable "Was it worth it?" reaction is rippling through the public, press and policymakers.

Judged by recent incentives paid or announced by other states to retain or lure major businesses, the answer appears to be "yes." In fact, Wisconsin may have kept Mercury Marine in the state at a "cost-per-job" that falls somewhere on the lower end of the national incentives scale.

The fight to keep Mercury Marine Inc. from moving its Fond du Lac operations to Oklahoma could cost Wisconsin taxpayers $70 million in public assistance to the outboard-engine maker, Doyle said last week. That's in addition to a $50 million loan funded by a half-cent Fond du Lac County sales tax and $3 million from the city of Fond du Lac.

In return, Mercury Marine is expected to retain or create up to 2,700 jobs in the Fox Valley, where it is one of the largest employers. About 400 of those jobs will come from the company shutting down a plant in Stillwater, Okla. If the company retains or creates the full estimate of 2,700 jobs, and all of the state and local incentives kick in, that's about $45,500 per job. A back-of-the-envelope estimate suggests 2,700 workers paid at $45,000 per year are worth $120 million per year in gross pay alone. That buys a lot of houses, groceries, electricity, health care, gasoline and all the other things that make a local economy click.

It also generates a lot of state and local tax revenue, which is how those governments recover their investments over time.

How does the Mercury Marine incentives package stack up to other recent deals?

* When IBM decided to open a technology delivery service center in Dubuque, Iowa, a stone's throw from Wisconsin, the cost per job created was about $40,700. That's based on the reported public-private incentive package of $53 million and 1,300 jobs, which is the predicted total when the center is fully operational in June 2010.

* In early June, GE Healthcare announced it will open a new digital mammography production facility in New York. The 230,000-square-foot facility will add 150 manufacturing jobs with an annual payroll of $10 million. Investment in the facility totals more than $165 million, including a capital grant of $10 million from New York state, according to the company. That's about $66,000 per job.

* In mid-2008, IBM announced it would invest up to $1.5 billion to expand and upgrade its facilities in New York, creating 1,000 jobs and retaining 1,400 more. The reported state and local incentive package was $140 million, or roughly $58,300 per job.

* The Mercury Marine incentives look like a bargain when stacked against the state, local and private package assembled in the attempt to keep General Motors in Janesville. That $195 million package, which included $115 million from the state, would have created between 1,200 and 1,500 jobs. Using the higher jobs estimate, that's an average of $130,000 per job -- or three times the Mercury Marine cost per job.

The cost-per-job equation is only one way to calculate the value of incentives, of course, with total investment by the company being another measure. Total investment takes into account capital expenditures and secondary jobs, such as construction, that are also valuable. But when unemployment is hovering around 10 percent, direct jobs and payroll are what most people understand and value.

To be sure, there's a philosophical argument against states engaging in an endless War of Incentives. In a perfect world, competition over job creation wouldn't involve state and local tax credits, land discounts and the like. But the world is far from perfect and the marketplace is brutally efficient, which means states must compete or risk losing jobs and companies they already have without gaining anything new.

Wisconsin's conservative public psyche may find incentive packages like the Mercury Marine deal troubling. It would be much more worrisome, however, if Wisconsin continued to stand idly by while other states and nations played an aggressive incentives game. Not all incentive packages are worth the cost, but the smart deals pay for themselves over time.

-- Still is president of the Wisconsin Technology Council. He is the former associate editor of the Wisconsin State Journal in Madison.


Thursday, November 5, 2009

The new retirement paradigm -- will my money last?

By Kevin Reardon
Retirement planning 20 years ago was far different and easier than it is today. Back in the good old days, Mom and Dad added up their expected social security benefits, pension benefits, reliably strong dividend and interest income. Many found this number to be adequate to maintain their lifestyle, so they retired. On occasion, they would tap into their principal to buy a new car or take a special vacation but those instances were relatively infrequent. In addition, most retirees had little to no debt, having paid off their house and rarely having financed a car or made a non-cash purchase. Lastly, the 60 year-old client of 20 years ago typically had the choice to continue working a few extra years if they wanted to create a little extra surety in their financial plan or if they simply wanted to stay active.

Fast forward to today. Clients who are approaching their traditional retirement age have a far different scenario. Most pre-retirees today do not have the traditional pension plans of yesteryear which offered a lifetime of guaranteed income. Most of those defined benefit plans were replaced with 401k plans and the burden of saving for retirement was shifted from the employer to the employee. Many workers didn't properly anticipate the need to save on their own behalf or they underestimated the amount needed to provide adequately in the new paradigm. Adding to the problem is the fact that these plans have fallen under duress in the last decade as the equity markets have produced negative returns for the last 10 years. The sad result is that 401k account balances have not reached projected values.

As we examine pre-retirees' dividend and interest income, we see much lower amounts trickling in each year. Interest rates have plummeted to 50-year lows and many corporations have reduced or eliminated their dividend payments. Gone are the days of 8-10% CDs rates and 6-8% money market rates that we saw 20 years ago.

Social security, although still viable for older workers, replaces a smaller percentage of a retirees' income today than in years past. In addition, a portion of a client's social security benefits are taxable if their incomes exceed a relatively low amount, further taxing the client's retirement budget.

The wage growth we experienced in the 1980s and 1990s did not continue into the last decade, further hurting a client's ability to save. Add in the cost of living increases we saw in the last decade and it explains why many workers today are struggling to pay off auto loans, credit card debts, and other consumer loans.

The last component facing today's pre-retirees is the longer life expectancy they will experience compared to their parents and the added costs that go with it. Not only will today's retirees need more assets to sustain this longer life expectancy but they are more likely to face long term care issues the longer they live. The cost of a prolonged illness can be staggering and financially devastating to a surviving spouse, especially when he or she does not have pension income that continues to roll in month after month.

So what is a worker to do in this new paradigm? While certainly not easy, the answers are relatively straightforward. First, recognize that we are in a new paradigm and the greater responsibility that has been placed on your shoulders, relative to your parents, to prepare for retirement.

Align your expenses before retirement to match your expected income in retirement. This allows you to "test drive" your retirement budget and make adjustments where needed. It will also allow you to save a greater percentage of your income in the last few years of your career, helping to catch-up your retirement savings. No one likes to cut their budget but the alternative of outliving your money should be a sufficient motivator.

Understand that working past a traditional retirement age of 65 is needed but that you will need to be proactive with your employer in explaining the value you provide relative to a younger, lower-cost worker that could replace you. Replacing an older worker with a younger worker may not be right and it might not even be legal given the laws against age discrimination - but it is reality. Start now in freshening up your skill set or in acquiring a new skill set that will make you irreplaceable.

Although pay cuts are never desired, if you are willing to reduce your salary as you get older, it could 'buy' you additional years of employment that could greatly aid your financial plan. In addition, consider retirement jobs you would enjoy doing that will help supplement your income whether that is consulting in your chosen field, working at a hardware store or craft shop, tutoring children, giving music lessons, serving as a tour guide, etc.

As you address the rising costs of healthcare and the increased chance of suffering a long term illness, make a plan today for how you would address this issue. Will your children be able to take care of you? Can your financial plan withstand hundreds of thousands of dollars of end of life expenses? Do you have permanent life insurance in place that can replace existing assets upon your death? What ever you decide, make a plan and discuss it with your children so they understand your situation.

We have entered a new paradigm in retirement planning, one that pre-retirees need to quickly address. A good financial planner will have already brought these issues to your attention and helped you structure a plan of action to help you succeed. If not, don't waste time planning for tomorrow because it will be here after today!

-- Reardon is owner & president of Brookfield-based Shakespeare Wealth Management Inc.


Wednesday, November 4, 2009

In the 'race to the top,' Wisconsin offers education examples to build upon

By Tom Still
MADISON -- President Obama showed up at Madison's Wright Middle School Wednesday to talk about reforming education, but that topic may not have been top of mind for everyone who came to hear him.

It was the day after Democrats lost races for governor in Virginia and New Jersey, two states where Obama made personal appeals, and during a time in which Congress is stewing over health-care reform, troop levels in Afghanistan and legislation to extend unemployment benefits.

In case anyone was listening, however, the setting was as good a place as any to talk about what it will take to produce better educated citizens.

Wright Middle School is a 12-year old charter school within the Madison School District. It has about 240 sixth-, seventh- and eighth-grade students, mostly black and Latino, with attendance rates that historically hover around 93 percent. It's been a public education success story because the students who attend all choose to be there -- and their parents choose to be involved.

Obama wanted to speak at Wright Middle School to highlight the "Race to the Top" competition, which will invite states such as Wisconsin to compete for a share of $4.35 billion in federal education grants. Obama, who believes lagging achievements in education are a chronic problem in the United States, urged Wright students to aim higher, calling education "a prerequisite for success."

He's right, of course. Better educated people are more likely to find jobs, keep jobs, earn a good living and contribute to society as a whole. The real debate is how best to produce more of them.

"Race to the Top" dangles federal aid carrots to states that raise academic standards, improve teacher quality and expand the reach of charter schools. While $4.35 billion is a lot of money, it represents only a fraction of total K-12 education spending in the United States -- about $667 billion in 2008-2009. It's even a fraction of federal-only spending on elementary and secondary education, a category that has grown sharply since former President Bush launched "No Child Left Behind" in 2001.

More money alone won't solve the problem. For "Race to the Top" to work, it must spur education innovation that spreads far beyond a charter school here and a new standard there. It must build upon best practices that can be broadly implemented, in Wisconsin and elsewhere.

Public-private efforts to enrich science, technology, engineering and math education provide ready examples of innovation. In Wisconsin, programs such as Project Lead the Way, Science Olympiad and FIRST Robotics have energized students and teachers alike -- and are beginning to yield results.

Project Lead the Way is one instructive example. It prepares middle and high school students for careers in engineering and technology through courses that capture students' imagination. It's used in 2,300 schools nationwide, including 162 in Wisconsin, and is taught by existing public and private school teachers who are immersed in PTLW techniques. The track record is impressive: 73 percent of Project Lead the Way students enter engineering or tech programs, and 80 percent earn their degrees.

Another example of thinking differently about education involves student testing. Wisconsin has begun the process of phasing out its current system of testing student performance in grades three through eight and 10 in favor of a system that will more effectively guide teachers, parents and students -- and help prepare those students for college and the workforce.

In the process, it should also help businesses in search for workers with 21st century skills, and Wisconsin taxpayers who have a stake in more effective use of local, state and federal dollars.

Other states have remade their testing systems already. Some, such as Oregon, have developed an Internet-based system, which dramatically shortens reporting time and allows for repeat tests for those who want to improve. Michigan requires the ACT test in its system, which lowers the statewide average score (a Wisconsin bragging right for decades) but serves to encourage more students to continue their education after high school. Nebraska built a statewide assessment system from classroom and district best practices. They're all designed to raise standards and performance.

Don't get me wrong: Wisconsin could use whatever share of the "Race to the Top" dollars it can get: It ranks a miserable 49th among the 50 states in per capita federal spending on K-12 education, according to one recent study. But let's make sure those dollars are put to work on innovation that can spread far beyond a school here or a classroom there.

-- Still is president of the Wisconsin Technology Council. He is the former associate editor of the Wisconsin State Journal in Madison.


Judging judges and voters fairly

By Bill Malkasian
In Wisconsin, judges and justices are elected by the people. Our Constitution requires it. The people must therefore be able to freely support candidates of their choice.

Last week the Wisconsin Supreme Court voted to reaffirm this basic principle and we applaud them for it. So should every Wisconsin citizen.

After hearing a wide array of legal, emotional and political arguments from a diverse and sincere set of individuals and organizations, the court made a very simple but important ruling by clarifying that judges cannot be forced off a case solely because of legal campaign contributions or endorsements they received during an election.

By ruling that lawful campaign contributions or endorsements alone cannot force a judge off a case, the court showed respect for both judges and voters.

Judges may still recuse themselves, for whatever reasons -- including campaign contributions -- if they feel they cannot be fair or impartial or if they feel sitting on the case will give that impression. Voters can now fully participate in judicial elections without fear that exercising their right to do so -- by making legal contributions or publicly supporting candidates -- will forcibly preclude judges from doing their jobs.

Critics of the court's decision, including some in the media, argue the entire Constitutional premise of electing judges should be thrown out.

They favor appointing judges, having taxpayers pay for judicial campaigns, adopting rigid contribution thresholds that force judges off cases, or some combination of these approaches. Still others argue we should do nothing now and just study the matter more.

While these larger systemic issues should be debated, the court rightfully ruled on the more narrow, more immediate issue of what is permissible under our current system. That's why the court did the absolute right thing, in time for the judicial elections this spring -- elections that Wisconsin has held for 150 years.

We should be proud of our Supreme Court for their thoughtful consideration of this difficult issue.

The justices had to consider the First Amendment rights of individuals and organizations to participate in elections and the due process rights of litigants to receive a fair and impartial hearing before a court. These are both fundamental rights and weighing them can be a tough balancing act.

While this court and others will be wrestling with the numerous remaining issues regarding recusal for many years to come, the court did the right thing by clearly saying voters have the First Amendment right to support judicial candidates of their choosing, and judges have the right to accept that support without being forced off cases for merely doing so.

We applaud the court for judging both judges and voters fairly.

-- Malkasian is president of the Wisconsin REALTORS Association (WRA), a trade association representing over 14,000 real estate brokers, sales people and affiliates statewide. The WRA, joined by 10 other major statewide organizations, petitioned the Supreme Court to amend the Code of Judicial Conduct's rules on recusal to address the issue of legal campaign contributions.


Tuesday, November 3, 2009

Academic R&D spending can translate to more economic growth statewide

By Tom Still
The latest figures from the National Science Foundation confirm what many people in Wisconsin already knew: the UW-Madison is one of the nation's leading research universities.

The numbers also underscore the fact that academic research and development isn't confined to the labs and research offices of the state's flagship university. Research and development work is taking place at colleges, universities and similar institutions across Wisconsin, and the total reflects a competitive edge most states would envy.

Sixteen academic institutions in Wisconsin spent $1.12 billion on science and engineering R&D in the federal fiscal year that ended Sept. 30, 2008, according to the NSF, up from $1.07 billion the previous year. That figure doesn't include about $40 million in research from two institutions not tracked by NSF -- the Marshfield Clinic and the Blood Center of Wisconsin -- or spending on non-science research by all 16 campuses.

The UW-Madison led the way with nearly $882 million in science and engineering spending, good for third on the list behind Johns Hopkins University and the University of California at San Francisco. That's right, the UW-Madison raised and spent more on R&D than UCLA, Michigan, Stanford, Harvard or MIT, to name a few universities most people would incorrectly suspect rank higher.

Toss in $63 million in non-science R&D spending at the UW-Madison, which was also third in that category, and the composite rank is second -- only behind Johns Hopkins, where about half of its $1.68 billion total is tied to defense work within its Applied Physics Laboratory.

More surprising to R&D groupies may be how much research is taking place outside Madison. The science and engineering total alone was $275 million in fiscal 2008, counting Marshfield and the Blood Center.

The Medical College of Wisconsin ($165 million) and UW-Milwaukee ($41 million) were the two biggest R&D centers outside Madison in 2008, but Marquette University, the Milwaukee School of Engineering and 11 other UW campuses showed up on the NSF's rankings of the 690 schools that spend anything on research.

Study after study has established links between academic research and development and job creation through what is called "technology transfer," or moving ideas from the laboratory bench to the marketplace. Wisconsin is a state that consistently ranks in the top quartile of states in academic R&D -- but it has not matched that performance when it comes to turning those ideas into jobs and economic production. That's why UW System President Kevin Reilly created a "Research to Jobs" task force in early 2009 and asked Carl Gulbrandsen, managing director of the Wisconsin Alumni Research Foundation, to lead it.

A core recommendation of the task force was creation of nine Emerging Technology Centers across Wisconsin to ramp up research that could translate to jobs. Two of the nine (tissue and cellular engineering at UW-River Falls and nanotechnology applications at UW-Platteville) have been launched. Others are planned for:

* UW-Oshkosh: Super‐capacity energy storage for next-generation electric cars and other energy intensive applications.
* UW-Stevens Point: Nanowire and nanostructure manufacturing for applications in solar energy, hydrogen sensors and nanoinstruments.
* UW-Whitewater: Interactive media and distance learning.
* UW-La Crosse: Pharmaceuticals based on medicinal plants and fungi.
* UW-Green Bay: Value-added products from waste, such as paper waste.
* UW-Stout: Plastics and composite materials, in collaboration with UW-Stevens Point.
* UW-Parkside: Biomedical sciences.

Over the past 80 years, WARF has done as good a job as any similar organization in transferring R&D into patents, licenses and economic activity. There are scores of companies in the Madison area that testify to the fact that UW-Madison research has moved from lab to commerce.

But most R&D apples don't fall far from the tree. The national rule of thumb is that most campus spinoff companies land within 50 miles of campus. The Emerging Technology Centers proposal is an effort to accelerate the transfer of technology from those campuses -- and to spur economic development in or near those campus communities.

Academic R&D spending is a tangible asset by itself, but its value is multiplied when the research yields new companies and jobs. It has happened in the Madison area -- it can happen elsewhere.
-- Still is president of the Wisconsin Technology Council. He is the former associate editor of the Wisconsin State Journal in Madison.


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