not just a financial transaction. The state has to see some value in having a relationship with the institution, and the other way around.

The state must help financially, Dr. Rottler added. Each national laboratory is a full-cost recovery organization. “The federal government is not going to fund us to work for businesses in the state that are not consistent with the mission of the institution,” he said.

Some government funding has been critical to developing partnerships with large corporations. Goodyear, for example, likely never would have entered its relationship with Sandia had the federal government not put in some money up front, he said. The funding helped give Goodyear time to understand the relationship and see what it could get out of it.

This is especially true for small companies. One example is the work Sandia has done for health spas in New Mexico. The spas are small businesses that take advantage of the state’s natural resources. One spa in northern New Mexico had trouble maintaining the right temperature, Dr. Rottler explained. “They didn’t have an understanding about how to engineer their system from a thermal management perspective,” he said. Sandia provided an engineer who quickly corrected the problem and helped the business.

Dr. Rottler also cited Sandia’s help for a small grower and processor of green chilies, a major crop in southern New Mexico. The company had a machine for cutting the stems off chilies that kept clogging and breaking down. “From an engineering perspective, it was not a great problem but for them it meant the difference between being solvent and insolvent,” he said. Sandia assigned an engineer, who solved the problem.

Such companies cannot afford to hire Sandia, whose services are quite expensive, Dr. Rottler said. “Our people are highly paid, are some of the smartest people on the face of the earth, and have capabilities that exist only in our facility,” he said. “The only way this happened was for the state to put money into it through the tax credit. Financial resources are a must.”

One questioner noted that labs such as Sandia have contractual agreements with their contractors to be engaged in economic development. She asked whether national labs should be required to make development part of their mandate.

Dr. Rottler was cautious. “I am always suspicious of mandates, especially if they come to us in a way that is a bit orthogonal to the mission, the thing the government pays us to do,” he said. “I also am very skeptical when they come to us without funding. That always leads to a dilution of mission. It results in the institution itself generally not being too enthusiastic, and as a result it often turns out badly for all involved.”

On the other hand, he said, labs like Sandia recognize that, as institutions, they are quite well off now. They have large revenue streams, and their employees are relatively highly paid. “So we are extremely sensitive to not being seen as carpetbaggers,” he said, as a federally funded institution that spends a lot of public money but whose staff just lives there and move on at the end of their careers.

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