Business

Pipeline in danger of losing state funding

More than five years ago and on the heels of the implementation of Kansas Economic Growth Act, officials at Kansas Technology Enterprise Corp. considered how they might do a better job of technology-based economic development.

It was through that process that the Pipeline entrepreneurship training program was created.

"The more you could do a full-court press in mentoring, having a deeper level of involvement with high-potential entrepreneurs, you would create some value," said Kevin Carr, CEO of KTEC.

Carr, whose agency continues to fund Pipeline a little more than a year after it became a nonprofit, said the program has developed respect nationally, and more importantly, in the state's business community.

He said it will take time for Pipeline to show its greatest value, because its entrepreneurs are starting up sophisticated companies and the results of those efforts take years to be realized.

"Many of these businesses are difficult to get going," he said. "(But) they are high-payoff if they do.

He also said that Pipeline, along with KTEC's regional business incubators such as Wichita Technology Corp. and other programs, levels the playing field for Kansas entrepreneurs in terms of accessing capital and expertise to grow their businesses.

Five years later, the agency that created the nationally renowned training program is facing the same uncertainty: a loss of public funding.

Gov. Sam Brownback's proposed fiscal year 2012 budget includes recommendations to eliminate funding Pipeline and consolidating parts of KTEC into the Commerce Department and the board of regents, effectively dissolving KTEC.

The state is facing a $550 million budget shortfall.

"The Department of Commerce will carry on the vision (of KTEC) and they will continue to advocate for those types of businesses in our state," said Sherriene Jones-Sontag, Brownback's spokeswoman.

KTEC receives all of its funding — $6 million in the current fiscal year — from the economic development initiative fund, which is funded by proceeds from the Kansas Lottery.

In response to Brownback's proposal, Carr said that carrying out KTEC's mission of serving both startup and more mature technology-based businesses is "very hands-on, very specialized and involves a lot of private-sector resources."

"I think that states in general have found that having their lead science and technology program outside state government can give it a lot more credibility in the business community."

KTEC invested $4.7 million in the Sedgwick County between fiscal years 2008 and 2010. Its network has created or retained 643 jobs and assisted 139 companies.

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