A seemingly insignificant decision just around the corner for University of Hawaii Board of Regents could have huge ramifications for the university and the state. It has the potential to help cure the university’s money woes, revive the university’s research community and stimulate the local economy, too.

Gov. Neil Abercrombie and UH President M.R.C. Greenwood have both emphasized the university’s potential to become a bigger economic driver. In his State of the State address on Jan. 24, Abercrombie said that “research programs at the University will play a big part in our economic recovery by bringing external dollars into our state and building innovative industries.”

Toward that end, last year Greenwood established an eight-member University of Hawaii Innovation Council to advise on how the university could stimulate “a multi-billion dollar industry for Hawaii research spin-off and related services.”

The goal is to turn the $450 million that the university receives in research funds into sustainable, local industries. It’s a compelling idea at a time when state coffers are shrinking and support for public universities drying up with it.

On Thursday, the regents will receive a report from Greenwood on that council’s first four recommendations. They include:

  1. Identifying research as an industry in Hawaii
  2. Creating a technology exchange institute
  3. Integrating entrepreneurship into the university’s curriculum
  4. Taking advantage of opportunities to commercialize. The university would monetize in four key areas, security and sustainability, energy and agriculture, data analytics and Asian-Pacific health.

The Hawaii Innovation Technology Exchange Institute (HiTEx) would replace the university’s Office of Technology Transfer and Economic Development, which critics say isn’t serving its purpose.

The institute’s goal would be to build partnerships with companies and potential investors, introducing them to university research and technology that it hopes would translate into new companies and products. The council also suggests that the institute could be run separately from the university as a not-for-profit operation that would emulate successful models in Arizona and Wisconsin.

The new push for innovation comes as Hawaii, like other states around nation, spends less on higher education.

Collectively, states have reduced their spending on public colleges during the last 20 years, according to the Association of American Universities — from 46 percent of operating costs to 27 percent.

Even before the economic downturn, the state’s share of UH funding had dropped from about 45 percent of total funding in 1995 to 33 percent in 2003. To make up that revenue decline, the university has three options:

  1. Increase tuition and fees
  2. Receive more federal grants and contracts
  3. Generate its own revenue through transferring research and innovation to the market

The council’s plan for an institute targets that third area. According to the council’s report, the institute could help stimulate the local economy by bringing investors and companies on board early in the innovation process. Ideally, they would help identify and fund research that has the potential to create local products and companies which would in turn generate new jobs and revenue.

“The university needs to build business partnerships earlier in the development process, which will increase the entrepreneurial activity,” the council’s report states. “This will require a fundamental re-alignment toward entrepreneurship, commercialization and collaboration on the part of the university.”

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