This publication updates the January 2004 study, New Returns on Investment in the Knowledge Economy: Proposition 301 at Arizona State University, FY 2003. Both works were launched by the report, Seeds of Prosperity: Public Investment in Science and Technology Research (2003), by Morrison Institute for Public Policy. Morrison Institute will periodically publish new material to keep you informed of the status of Proposition 301 investments at Arizona State University.

Arizona’s public behavioral health care system, which serves some 150,000 mentally ill and vulnerable state residents, is wrestling with a number of urgent challenges. In addition to budget cuts resulting from the current economic crisis, and the demands of a 28-year-old class-action lawsuit, the system has been repeatedly criticized in several areas, including for inadequate staff, data, housing support, and crisis services. On July 22, a panel of professionals who play key roles in the system discussed these and other issues before some 300 behavioral health providers, supervisors, and policymakers at the annual Summer Institute hosted by Arizona State University’s Center for Applied Behavioral Health Policy. This paper provides an abbreviated report of that discussion, which was partially designed and moderated by ASU’s Morrison Institute for Public Policy.

Severe and widespread budget cuts in behavioral health and substance abuse services for lower-income Arizonans who don’t qualify for AHCCCS have already taken effect across the state. Even before these cuts were implemented, it was clear that the publicly-supported behavioral health system in our state was not adequately serving many Arizonans who needed mental health or substance use disorder treatment. This paper represents an effort by Arizona State University’s Centers for Applied Behavioral Health Policy and the Morrison Institute for Public Policy to promote and enrich Arizona’s public dialogue about these problems and potential solutions.

Almost every state hopes to capitalize on the tremendous wealth and job creation that can be generated by high tech science research-and billions of public dollars are being spent. But everyone is just speculating about the lasting value of these investments. While traditional assessments of return on public investment in science and technology tend to track short-term impacts, such as salaries, patents, and licensing revenues, the main foundations for long-term development of a knowledge economy appear to rely on a number of less tangible accomplishments. For example: Connections - the networks that develop between researchers, entrepreneurs, and venture capitalists; Attention - the publicity generated by the research and its networks that attract businesses and talent to locate in a region; and Talent - the highly skilled workers that such research attracts and trains.

These three indicators of economic success-henceforth called the CAT measures-have yet to be quantified and applied in a useful manner. That is the purpose of this study. It will be conducted in three parts, each with a culminating report. The first part will analyze the FY03 science and technology research activities and results for ASU's Proposition 301 initiatives. The second will develop a methodology for quantifying and utilizing the Institute's CAT measures. The third will field test the CAT methodology on a selected aspect of ASU's Proposition 301-funded research, and analyze results to provide Arizona decision-makers with recommendations to guide future policy.