U seeks 5-in-1 deal for new labs

04/24/2006

Lawmakers debate whether bioscience merits special break

BY BILL SALISBURY
Pioneer Press

While a plan to construct a University of Minnesota football stadium was grabbing headlines and sparking water cooler conversations in recent weeks, another university building request that could make a far bigger hit on Minnesota’s economy has been quietly marching through the Legislature.

The U wants $366 million to build five bioscience research laboratories in the next 10 years.

The big question lawmakers must answer is whether to make a 10-year commitment to construct all five buildings. That would break with the legislative tradition of requiring the university and all state agencies to ask for construction money one building at a time in bonding bills passed every two years.

University officials, Gov. Tim Pawlenty, legislative leaders and biotech industry executives all agree the research done at these facilities would produce medical and scientific breakthroughs that promote health, save lives and give rise to dozens of new businesses and thousands of jobs.

“I think this is an investment in the future of the biosciences industry in the state of Minnesota,” Dr. Frank Cerra, the university’s senior vice president for health sciences, said last week.

The Legislature is likely to at least make a down payment on the project this spring. The House and Senate have passed bonding bills that provide $40 million for the first of the five research buildings. The U would be required to contribute $20 million for the facility.

“It was the most important project in the bonding bill,” said Senate Capital Investment Committee Chairman Keith Langseth, DFL-Glyndon. “I think it’s our future.”

Under the U’s plan, the Legislature would create a separate Biomedical Sciences Research Authority and authorize it to issue $330 million in general obligation debt through bonding to finance the lab buildings. The authority could finance construction of one building every two years.

Bills to create the nine-member authority are ready for quick legislative action, said the sponsors, Sen. Richard Cohen, DFL-St. Paul, and Rep. Ron Abrams, R-Minnetonka. “I hope we can get a jump-start” from Pawlenty and House and Senate leaders of both parties to get the bills moving, Abrams said.

Here’s the rub for some legislators: The $330 million under the authority’s control would count against the state’s borrowing limit for other projects.

House Capital Investment Committee Chairman Dan Dorman, R-Albert Lea, enthusiastically supports building the labs, but he questions whether they should get special treatment in the bonding process.

“Why should we put them at the front of the line ahead of every other bonding project?” he asked. That would require the Legislature to “give up its rightful role” of setting construction priorities.

This university project needs the kind of long-term commitment that the current bonding process doesn’t provide, Cerra said, because it takes several years to recruit top-shelf researchers and design and build technologically sophisticated labs.

“We need the ability to plan in a stable environment,” he said. The U couldn’t guarantee that stability if it had to go back to the Legislature every two years to request funding for the next building.

He said the state needs to make a commitment to the project now to compete with fast-growing bioscience initiatives on the East and West coasts and worldwide.

The competition is fierce. More than a dozen states already have started big scientific research programs. California voters approved spending $3 billion on stem cell research. Wisconsin Gov. Jim Doyle launched a $750 million initiative, with more than half the money earmarked for biomedical research facilities at the University of Wisconsin.

Minnesota doesn’t need to make as large an investment as other states because it starts with a stronger foundation, Cerra said. It’s a world leader in the medical device industry, led by such companies as Medtronic, Guidant and St. Jude Medical. And the university and Mayo Clinic are nation-leading research institutions.

“Biosciences is a growth area in this country and the world, and it’s where we have a leg up on other states,” he said. “But if we don’t make the investments, we will lose our advantage not only to other states but to China, Britain, the European Union and Singapore. …

“If we want to become a fly-by state, we shouldn’t make the investment.”

Under the U plan, each new research building would house 40 “principal investigators” and 140 other researchers. Each group of investigators and researchers would be expected to generate about $20 million a year in research grants from the National Institutes of Health and other federal agencies, as well as private foundations like the National Cancer Foundation.

Minnesota’s biotech and business communities strongly support the proposal.

Competition is fierce for top-flight researchers who can win big research grants, and the university needs “top-end tools” to attract them, said Don Gerhardt, president of LifeScience Alley (formerly Medical Alley and MNBIO). “It’s extremely important that the university is equipped to produce both the research and the people we need.”

Medtronic vice president Dale Wahlstrom, chairman of the BioBusiness Alliance of Minnesota, warned that other states have targeted Minnesota’s medical device industry. “They’re making tremendous investments in research capability to make our products obsolete,” he said. “We have to invest in order to maintain our position.”

The Minnesota Business Partnership, representing 110 CEOs of some the state’s largest employers, is strongly backing the university’s request, said Charlie Weaver, executive director.

“The university must break out and become a global leader in biomedical research — with all the collateral benefits in terms of work force and new business — or Minnesota risks falling behind in this growing field,” Weaver wrote in a letter to Pawlenty last week.

Pawlenty supports giving the university the authority this year to proceed with all five buildings, but if the Legislature funds only the first building, he said he would accept that as the first step and push for the remainder of the package next year.