One lawmaker says Proposition 102 has largely been “under the radar” and is not getting the attention it deserves.

“If somebody comes up with a negative,” said Rep. Gary Pierce, R-19, “I think I could shoot holes in it.”

Officially titled University Technology Payment, the proposition aims to amend the state Constitution to allow the state to acquire stock in a private company as payment for licensing of technology or intellectual property created or acquired through research at the state universities.

“By allowing the universities to accept equity instead of cash, it allows the university to allow smaller startups to get access to university research,” said Peter Slate, CEO of Arizona Technology Enterprises, a firm managing Arizona State University’s technological commercialization.

Mr. Slate said many companies in need of the research capabilities provided by a state university are small and do not have enough money to pay for the research, as the state Constitution currently requires.

Lawmaker: Universities Need New Direction

Rep. Bob Robson, R-20, one of the sponsors in 2003 of HCR 2028, the legislation that put the proposition on the ballot, said allowing the universities to accept stock or equity in a company instead of cash is part of the “new vision” of the direction the universities are headed.

“It’s needed to enhance education and facilitate the entrepreneurial role education needs to take at the highest level, at the universities,” he said.

Right now, Mr. Robson said, partnering with private companies is “an untapped resource” that could pay big dividends for the universities, both in terms of finance and prestige, ultimately saving students and the state money.

In time, Mr. Pierce said, as the universities collect more money from the royalties earned from products developed using their research, the schools will be less of a drain on the state’s general fund.

Rep. Tom O’Halleran, R-1, said allowing Arizona universities to partner with more private companies will not only benefit burgeoning industries in the state, like genomics and biosciences, but will also help the universities develop the funding to compete with other research universities.

“We need to get to a level of competition,” he said. “Right now, I don’t think state funding is enough to do it.”

Mr. Robson also suggested the increased research for private companies may positively impact the state schools’ abilities to retain top professors.

“This keeps us in place,” he said, “or maybe gives us a little more of a competitive edge.”

The economic impact of the proposition extends beyond the universities.

“It builds a stronger bond with universities and companies,” Mr. Slate said, adding that community-company relationships will also be forged. “In actuality, it means these companies will feel a stronger allegiance to the public university, which also ties them into the community.”

Supporter Touts Possible Creation Of High-Paying Jobs

It will also be beneficial in attracting more companies to Arizona, which in turn helps the economy, said Jackie Norton, executive director of the Arizona chapter of the National Association of Industrial and Office Properties.

“Where the economy gets the boost is having that [university] research commercialized,” she said.

She said most high-tech businesses are relatively small in size, meaning they could quickly react to a change in Arizona law and have an impact very soon, if Prop. 102 is approved. The most visible impact, Ms. Norton said, would likely be the creation of high-paying jobs.

“The best way to do that is to have sophisticated technology that requires people with the skills that need high wages,” she said.

The only concern Mr. Slate has is that people are uninformed about the proposition.

“The people in the know will vote for it,” he said. “If you don’t know enough about it, you may vote against it.”

Sen. Jim Weiers, R-10, said he is not worried about the proposition failing, because “it’s probably one of the most straightforward propositions on the ballot.”

Mr. O’Halleran echoed those feelings.

“It’s one of those ones where you say, ‘Why didn’t we do this sooner?’” he said.

A Detractor

There are more than 20 arguments in support of Prop. 102 in the official election publicity pamphlet published by the Secretary of State’s Office. There is only one asking voters to reject the ballot measure. “Public officials could create, buy, trade, and control private companies with taxpayer property,” writes Phoenix resident Robert Haney. “’Tech transfer’ is a misnomer; technology would not be transferred to the private sector. After Prop. 102, the most valuable discoveries would never be sold, but ‘gifted’ without a public bid or auction, to companies controlled by public officials (or their cronies).”—