Federal Funding Strategies For Today's Manufacturer

Every year the federal government authorizes billions in funding for research and development, workforce initiatives, or expansion and growth plans.

In order to keep pace with other industries, manufacturers must become more creative and aggressive in how they leverage the support of the federal government. It may seem like a case of "easier said than done," but there are three basic ways manufacturers can receive federal support, including competitive grants, discretionary grants and appropriations. Every year the federal government authorizes billions in funding for manufacturing businesses and related activities such as research and development projects, workforce initiatives, or expansion and growth plans. With the many opportunities that exist for manufacturers in the government marketplace, manufacturers need to consider implementing a government affairs strategy that can help them obtain a piece of that support.

Case In Point -- Research And Development Funding
National Center for Defense Robotics

Innovation and new product development are the lifeblood of growth for manufacturers and the federal government offers a great deal of funding for R&D. These funds come primarily come from seven federal agencies including: Agriculture, Commerce, Defense, Energy, Health and Human Services, Homeland Security and Transportation.

In 2003, when the Southwest Pennsylvania region wanted to create a research and development center to address and support the burgeoning robotics, electro-optics and sensing manufacturing needs of the U.S. Department of Defense (DoD) and its suppliers, they turned to GSP Consulting for help. Understanding the need to create a non-profit organization that could be the "umbrella" for many of the region's growing robotics companies and universities, GSP worked with the foundation community, various levels of government officials, the private sector and investors to help create the National Center for Defense Robotics.

The NCDR quickly became a conduit for federal R&D dollars that would return to the community in the form of R&D or challenge grants for growing companies as well as contracts that would become pathways for companies and universities to the DOD, the government world and its primes. NCDR became a model for potential for job creation and positively impacted the local regions ability to enter the defense industry and its marketplace. GSP created a funding strategy and worked closely with U.S. Congressman John Murtha, US Senator Arlen Specter and US Senator Rick Santorum to fund the center and its activities at the federal level. What resulted was over $10 million in funding over a 3-year period which is partially responsible for helping the U.S. Department of Defense create and bring to use cutting-edge technologies and processes to the robotics and sensing realm.

The Agencies And The Opportunities

Navigating the government marketplace to find funding and contract opportunities can be a daunting challenge for even the largest of companies. Researching the opportunities, monitoring cycles of funding, and following the application process can easily be a full time position.

Sometimes, it is in the company's best interest to seek outside expertise in order to determine which agency's funding and support to pursue and what the guidelines are for pursuing it. For example, Workforce Development funding is made available primarily through grants and appropriations, and is funded through three main government agencies -- Labor, Commerce and Education. A company needs to be sure that the money they are requesting is used for workforce training, continuing education or certification activities. And, many times a project requires that a there be a multi-company coalition or collaboration with a university.

For research and development funding there is a wider range of agencies that provide support including Agriculture, Commerce, Defense, Homeland Security and several others. What becomes cumbersome for many companies is determining which agency is the right one to pursue and how to maneuver through the process efficiently and successfully.

Case In Point -- Workforce Development
Renal Solutions

When it comes to finding and keeping a qualified manufacturing workforce, training and education top most companies' wish list. Today's advanced manufacturing is a far cry from the factories and mills of yesteryear. Many manufacturing outfits are combining biotech with traditional manufacturing and finding they need highly skilled workers who understand both the bioscience side and manufacturing part of the business.

One such example is Renal Solutions, a Pittsburgh-based medical device and healthcare company. When the company needed to train it's workforce to manufacture products related to the next generation of dialysis, it faced a major workforce training issue. The company turned to GSP who was able to help them secure a Department of Labor grant to train "Hybrid Workers" -- a term coined through this program. A Hybrid Worker is one with traditional manufacturing skills but also has knowledge of the health care and biotech industries. Because this client has a unique product offering, they needed support and funding to quickly create a technical workforce.

Seeing the potential of this program, other stakeholders joined the effort, including local community colleges and technology industry groups. GSP implemented a federal funding strategy for Renal Solutions that resulted in a $2.4 million grant from the Department of Labor. This grant enabled the firm to create a training program that would effectively bridge the gap between manufacturing and biotech for their needs.

Policy Points -- Legislation Impacting Manufacturing

Today's manufacturer faces new challenges and difficult choices in this ever-changing industrial world. As a result of these circumstances, policy issues are becoming more critical to the growth and success of the manufacturing industry along with the US economy as a whole. Some of the most important policy issues facing manufacturers include trade issues - which include training, exporting and competitive balance. All of these contribute to how and why manufacturers pursue federal funds.

One such example is annually restoring funding for the Manufacturing Extension Partnership program, or MEP. The MEP program receives funding from Congress on an annual basis to help level the manufacturing playing field so that US manufacturers can compete globally. Congress has appropriated varied amounts for the MEP program over the past decade, ranging from $40 to $110 million. The MEP funding is parsed out over a number of traditional manufacturing states and is administered by non-profit organizations that turn the funding into much needed services that help manufacturers compete. These services range from helping small to medium size manufacturers achieve ISO certification to workforce development & job training. These centers also can be a source of networking, contract opportunities, low interest loans for equipment and facility upgrades and the like.

GSP works closely with a group of these centers in Pennsylvania known as the IRC Network of PA (or Industrial Resource Centers). This group of centers lobbies in DC every spring to assure that this line item is not cut and that manufacturers can continue to receive these much needed benefits. In other countries where labor laws and trade incentives hamper US manufacturers with unfair trade laws, the need to provide some services to our manufacturing community is paramount.

The Lesson For Manufacturers

Now is the time for all manufacturers -- old economy, new start-ups and advanced manufacturers -- to investigate federal funding to fuel growth. Whether you are a 21st century manufacturer like Bliley Technologies that received a federal appropriation for $2 million from the Department of Defense and a multi-million dollar business incentive package for job training, expansion, site improvement and new equipment, or a traditional manufacturer like Erie Shipbuilding that received federal money and nearly $3 million in state assistance for site build out, renovation, and job training, both received a competitive edge through government funding.

Joe Kuklis is a co-founder and principal of GSP Consulting Corp., a government affairs and consulting firm. Since 2001, GSP has generated hundreds of millions in funding for clients in the manufacturing, technology, life sciences, economic development and non-profit industries. . Headquartered in Pittsburgh, GSP Consulting operates offices in Cleveland, Tampa, Philadelphia, Dover, Del., Washington D.C., Harrisburg, State College, Pa., Lansing, and Ann Arbor, Michigan. For more information visit www.gspconsulting.com or call 412-765-1180.

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