I like using the seasons of the year as a rough metaphor when evaluating Texas' economy. Several of our state's most historically important economic drivers are in their winter season. We all know that oil & gas and agriculture have been the economic forces that provided for the well being of a majority of Texans. Both of those industries are witnessing bad times at the moment with some fearful that recovery may never return. Another indicator of their declining importance is that when oil prices collapsed in the 1980's it was followed by a collapse of the general Texas economy. Today with agriculture and oil & gas in significant financial distress, the over all economy is booming for most Texans. Why? The significant growth in high technology and services industries.
Our high tech industries are clearly in the full growth of their summer season. This was not always so. In the 1980's, Texas was behind in the development of our computer, telecommunication, and other high tech businesses. The leadership of our state's legislature, industry and academic interests recognized our lack of new developing industries. After studying the situation, they set out to make a significant effort and very profound public statement about how Texas was encouraging the growth of high technology businesses. Remember, at this time, the world had only heard of California's Silicon Valley and Massachusetts' 128 Corridor. To let the world know that Texas was going to be a powerful player in the computer technology world, in a collaborative effort of industry, academics and government, we created Sematech. Its purpose is the development of an industry-supported advanced research and development institute, designing leading edge computer manufacturing processes. We also developed MCC research consortium, a joint research effort of computer and semiconductor companies, which developed and shared technological discoveries to member companies. These two bold initiatives certainly told the world that Texas was aggressively courting the brain power of the computer industry's future. It is well known that where the brains go, money will flow. With sufficient financial support, new businesses are started and jobs are created. Today, Texas certainly enjoys a vibrant computer technology industry.
Probably more this session than in any previous one, words like biotechnology and biosciences are floating through the halls of the State Capitol. The year 2000 is literally just around the corner. There won't be another legislative session before the end of this millennium and many technology issues must now be addressed in order to give Texas direction for the next century. Broadly defined, biotechnology is the use of biological processes and organisms to make products or modify plants, animals or micro-organisms. With 13,000 jobs, the Dallas-Fort Worth region is the largest employer of healthcare technology jobs in Texas. The Dallas Plan is a flexible, 30-year comprehensive plan involving individuals and organizations in specific projects that, together will generate large-scale, city-wide improvements. One of these projects is the development of the biotechnology industry in the Dallas-Fort Worth. Institutions like the University of Texas Southwestern Medical Center provides Dallas and North Texas with the opportunity to benefit from R&D tax credits.
Numerous discussions have been held with legislative and business leaders, the Texas Healthcare and Bioscience Institute, and various members of the University of Texas system on the role that the State Legislature should play in ensuring the success of the bioscience industry in Texas. According to Dr. Kern Wildenthal, President of the University of Texas Southwestern Medical Center, "supporting the biosciences industry will provide a tremendous incentive to bring business to Texas. Initially, it will bring more research opportunities to our area, which in turn will bring more research dollars to Texas, and create more jobs for our citizens. The future economic well-being of this state relies heavily on the development of this field." Recognizing that this new frontier is in the spring of its existence, I have filed HB 2803, establishing a Biotechnology and Biogenetics Research Initiative in Texas. This bill will encourage and provide support for basic research in biotechnology, biogenetics and directly related disciplines at various institutions. It is important to know that today there is no Silicon Valley of the biosciences. Texas must seize the moment and establish itself as a leader in this industry of the future. Following in the model of our previous successes in the computer industry, an aggressive and bold initiative today will mean jobs for Texans in the bioscience industry of tomorrow.
Another element in this aggressive approach aimed at attracting new, innovative thinking to Texas is Representative Tommy Williams' (Houston) HB755, establishing a franchise tax credit for certain research and development conducted in Texas. This bill would offer a 10 percent credit on research spending is six designated areas: advance computing, advanced materials, biotechnology, electronic devices, environmental technology, and medical devices. Representative Williams agrees with me that the high tech industry and biosciences are the key to the future growth of our state economy. We need to foster a business climate that welcomes start-up companies to Texas and gives them a reason to stay. I fully support Representative Williams in his efforts and plan to work with him to ensure the passage of this legislation.
As always, I would appreciate your input on these bills. Please contact my office at P.O. Box 2910, Austin, Texas, 78768-2910, or E-mail me at kenn.george@house.state.tx.us.