The Biggest Tech Policy Issues in 2010

Tech business leaders weigh in on the most important local and national tech policy issues in 2010.

By Avery Fellow | March 5, 2010

Businesses and policy makers in the Washington, D.C., region are adopting an aggressive stance on tech policy issues in order to put the area in a good position as the nation climbs out of the recession.

"The economy is clearly the number one issue," said Josh Levi, Vice President for Policy at the Northern Virginia Technology Council, weighing in on the most important policy concerns the region faces. 

Virginia has taken a two-pronged approach to economic development, Levi explains. The first is to bill the state as "business-friendly" and the second is to loosen regulations.

Virginia governor Bob McDonnell is currently reviewing a bill that would exempt new biotech, alternative energy or other technology business that set up shop in Virginia from paying capital gains taxes during their first three years of operation. The bill has already passed in the House and the Senate.

"That’s very important to continuing to nurture young companies," Levi said. "We are working to ensure that we are the number one place for startups, for entrepreneurs and for early stage investors."

In addition, Virginia has a Center for Innovative Technology GAP fund that makes seed stage investments in tech and life science startup companies in the state. For every dollar that the state directs toward the fund, the private sector provides 11 dollars. The state currently has 32 companies in its GAP portfolio. The General Assembly and the Senate are proposing an additional $2 million for the GAP fund and the House is proposing $1.5 million. Legislation will hit the governor’s desk over the next few weeks.

Maryland is also trying to draw in new businesses, painting itself as the national cyber security hub. Early this year, the state released a report entitled "Cyber Maryland" outlining its plan to strengthen technology education, build cyber security testing labs, and create a cyber security/IT law council in order to encourage cyber business to locate to the state.

According to TechAmerica, state and local governments are expected to spend more than $92 billion on IT products and services in 2010, while federal procurement is expected to only reach $75 billion.

On a federal level, Internet privacy issues promise to dominate 2010 tech policy.

"Policy is in many ways harder than the technology. It’s swishy, it’s opinion, it’s national pride. It’s a variety of things," father of the Internet and Google Chief Evangelist Vint Cerf said at last week’s Southeast Venture Conference in McLean, Virginia.

Cerf shared Google’s recent struggle with privacy over its release of Buzz, a social networking tool embedded in the Gmail site, which took a lot of Google users off-guard when it automatically linked users to their most frequent email contacts. "Privacy is important," Cerf said. "We made a mistake in not telling people what it did."

"Online privacy could well be the buzzword of 2010," said David Mack on The 463: Inside Tech Policy, a blog hosted by Washington, D.C. and San Francisco tech communications firm 463.

"With ongoing FTC roundtables, impending legislation and a flurry of questions about what all this openness is doing to our society, we’re guaranteed to see changes in the way we share online information this year," Mack said.

The emphasis may shift to user-based controls. Facebook and Google both added more privacy controls in 2009 and will continue to ramp up advanced user settings.

Also on a federal level, the government is starting to insource jobs, recruiting workers from the private sector to bolster the federal workforce.

"This is causing a lot of concern in the technology community in D.C., Maryland and Virginia," Levi said. Private contractors, many of which are headquartered in the Washington, D.C. region, are seeing their employees recruited by the government.

There is also a push in Washington to ensure that research and development tax credits become permanent, which will encourage research on the federal level. The Semiconductor Industry Association is moving its headquarters to Washington this year to lend its advice to policymakers on this issue. SIA spokesman John Greenagel says the association heads will focus on educating policymakers on the importance of keeping R&D in the United States.

Another federal issue is Internet taxation. Policymakers are debating whether a company in Virginia should charge taxes to online consumers from other states or what will happen if a small company gets audited in several states.

"The question is, at what point is Congress going to come up with a streamlined system?" Levi said.

Internet policy issues will be addressed at the upcoming D.C. Policy Impact Forum on March 16. The event, hosted by VeriSign, features Bill Clinton as keynote with Dr. Fareed Zakaria, Rob Atkinson, Rod Beckstrom, Aneesh Chopra and Arianna Huffington in attendance.


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