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Innovista’s Job-Creation and Research Claims Overstated?

Despite the University of South Carolina’s failure to bring high-tech firms to its research campus known as Innovista, the university is claiming that its seven-year-old project has created or attracted hundreds of private-sector technology jobs.

But USC can’t back up its job-number claims – at least to The Nerve.

It wouldn't be the first time the Innovista project has failed to live up to publicly announced expectations.

In seeking state approval last week for a $13.3 million taxpayer-funded bond project to complete work on an Innovista campus research building, the university released a document to The Nerve and other media that said Innovista is a “magnet for jobs in Columbia and the Midlands.”

Specifically, the document listed five “Innovista affiliated companies” that mainly focus on insurance technology as collectively employing about 700 workers; and another eight technology companies and a nonprofit technology organization housed in a privately owned downtown Columbia high-rise, dubbed "IT-oLogy @ Innovista," as employing a total of about 300 workers.

But when asked last week by The Nerve to verify the employment numbers, Wes Hickman, USC’s chief spokesman, declined to do so.

“We don’t because they are private companies,” Hickman said. “They asked us not to give out specific information about each company.”

Hickman said the purpose of Innovista is to “match the private sector with research” by USC.  In a written response late Monday afternoon to The Nerve, however, Hickman didn’t provide any examples where USC research was commercialized by the companies in question.

Instead, regarding the insurance technology companies, Hickman said the university “supports the insurance technology cluster in helping to supply an educated workforce with both its IT grads and business grads with degrees in Insurance and Risk Management.”

Hickman pointed out that USC alumni Larry Wilson, former head of Policy Management Systems Corp., a software firm in Richland County that later was sold to Computer Sciences Corp., is “associated” with the five "Innovista affiliated" companies: Duck Creek Technologies, which last year was acquired by technology consulting and services giant Accenture; EagleEye Analytics; Dovetail Insurance Corp.; NetComp Insurance Corp.; and Unitrends Inc.

“The quality of life Larry Wilson sees technology companies improving is already evident in Columbia,” Hickman said.

But it’s unclear whether the insurance technology and other listed companies collectively employ approximately 1,000 workers in the Columbia area, as claimed by USC. The Nerve on Monday attempted to contact most of the firms but was able to reach only several before publication of this story.

Tony Mattioli, president of Dovetail Insurance, said his insurance technology company has 60 employees, though he referred further questions to Wilson, who, according to Mattioli, is the company’s board chairman.

At EagleEye Analytics, a spokeswoman said her company employs about 30 workers but didn’t immediately know how exactly the Innovista project was related, saying she had to first consult with other company officials.

Bethany Human, communications and social media coordinator at TM Floyd & Company, an information technology consulting and services  firm headquartered at the “IT-oLogy @ Innovista” high rise located kitty-corner from the State House grounds, said her firm employs about 150 to 200 consultants nationwide, most of whom work in Columbia.

Human said her company has a “relationship with Innovista,” noting, “We like to be involved with USC.” Asked for specifics, she said her firm hopes “young, bright IT students know who we are in the future once they graduate.”

When USC graduates Bill and Lou Kennedy, who are co-owners of Nephron Pharmaceuticals, "saw the great things happening in Columbia and the assets that the University (of South Carolina) could offer," they decided to locate a $313 million plant in Lexington County that eventually will employ more than 700 workers, in addition to donating $30 million to the university, Hickman said in his written reply.

He noted that the Florida-based company, which broke ground in March at the Lexington County site, was "recruited as part of the Innovista strategy."

Hickman also said Innovista is a "key part" of the Fuel Cell Collaborative, which recruits fuel cell companies to the Columbia area; and is a "key supporter" of the USC Columbia Technology Incubator, which provides support to start-up technology companies.

The original Innovista plan called for two publicly funded research buildings, named Horizon I and Discovery I, at USC’s downtown Columbia campus; and two privately funded buildings in the same area -  Horizon II and Discovery II - to house high-tech firms that would market products tied to USC research.

The Innovista project was supposed to create or support more than 6,500 jobs with an annual financial impact of $232 million, according to original estimates.

But plans for the privately financed buildings fell through amid controversy involving John Parks, Innovista’s former director. Parks resigned in 2010 after the (Columbia) Free Times reported that private developer Kale Roscoe, who previously worked with Parks at the University of Kentucky, had served about a year in prison for federal tax evasion and was a defendant in dozens of lawsuits.

In his written response Monday, Hickman said TM Floyd, another company called VC3 and a nonprofit technology organization known as IT-oLogy originally planned to locate in the Horizon II building. All three are housed nearby in the “IT-oLogy @ Innovista” high-rise at the corner of Gervais and Sumter streets.

“Innovista has worked hand-in-hand with IT-oLogy to help recruit other IT companies to that space in order to establish a hub of IT talent,” Hickman said.

On its website, IT-oLogy describes itself as a "collaboration of businesses, academic institutions and organizations dedicated to growing the IT talent pipeline and advancing the IT profession." Tony Ambler, dean of USC's College of Engineering and Computing, serves on IT-oLogy's board of directors, according to the site.

Meanwhile, USC continues to push toward completing one of its two Innovista research buildings – largely at taxpayers’ expense.

Last week, the five-member S.C. Budget and Control Board approved spending $13.3 million in taxpayer-funded bonds to build out the first and fourth floors at the Horizon I building, located at the corner of Columbia’s Main and Blossom streets. With interest, the total taxpayer cost of the bonds is projected at more than $15.5 million over the next 15 years, according to documents submitted to the BCB.

The total cost of the Horizon I "upfit" is estimated at $26.8 million, which includes a nearly $12.8 million matching gift of computer software and equipment from IBM, and a $657,704 Air Force grant, records show. 

The match is required under the SmartState or endowed chairs program, which uses state lottery proceeds and non-state matches to pay for high-priced professors and research centers at USC, Clemson University and the Medical University of South Carolina.

To date, the total estimated investment in the Innovista campus, which includes parking garages paid for by the city of Columbia and Richland County, is at least $144 million, according to the university records.

Nearly half of the total investment – $71.3 million – is funded through taxpayer-backed state bonds, including the $13.3 million approved last week, records show.

Reach Brundrett at (803) 254-4411 or rick@thenerve.org.

 

Budget and Control Board Economic Development Innovista Corporate Welfare

Larry Wilson University of South Carolina IT-oLogy SmartState Innovista