Requires the department of community, trade, and economic development to administer an innovation partnership zone program consisting of innovation partnership zone grants and technical assistance and planning grants. The director shall disburse innovation partnership zone grants. Innovation partnership zone grants must be used to facilitate the collaboration between research teams, industry, and workforce training providers that will lead to the formation and financing of new innovative firms, the commercialization of research results, and the movement of firms and industry clusters into globally competitive niches. The grants will be awarded consistent with the following criteria and such other criteria as the director develops in consultation with the Washington state economic development commission: (1) Each grant must be matched by a commitment of financial support from the private sector equal to or greater than fifty percent of the requested grant amount;

(2) Eligible grant applicants may include associate development organizations, port districts, workforce development councils, educational or research institutions, and local jurisdictions;

(3) No more than two partnership zone grants shall be awarded during the biennium ending June 30, 2009, to recipients in the central Puget Sound region, a minimum of two such grants shall be awarded in eastern Washington and a minimum of one such grant shall be awarded in western Washington outside the central Puget Sound region;

(4) Applicants for innovation partnership zone grants must: (a) identify the geographic area within which they will concentrate their efforts, using commonly available data and maps, that will lend itself to a distinct identity; (b) show the presence within the innovation partnership zone of research capacity, including research teams focused on emerging technologies and their commercialization or faculty and researchers that could increase their focus on commercialization of technology if provided the appropriate technical assistance; (c) show, using labor market information from the employment security department and local labor markets as well as data on revenue growth rates, wage levels, and other factors, a substate geographic concentration of firms within the proposed innovation partnership zone that are important to the economic prosperity of the state and have comparative competitive advantage or the potential for comparative competitive advantage; (d) demonstrate training capacity either within the zone or readily accessible to the zone. The training capacity requirement may be met by the same institution as the research capacity requirement, to the extent both are associated with an educational institution in the proposed zone; (e) demonstrate the support of a local jurisdiction, a research institution, an educational institution, an industry or cluster association, a workforce development council, and an associate development organization, port, or chamber of commerce; (f) disclose the service delivery mechanisms to be used to allow industry associations, cluster associations, and businesses to access the technical assistance, advisory, research, and commercialization capabilities of research teams; (g) detail how training services will be coordinated and delivered to industry associations, cluster associations, and businesses; and (h) describe the methods by which the applicant will facilitate the competitiveness of firms, the commercialization of research, and the upgrading of worker skills within the innovation partnership zone.

Appropriates the sum of ten million dollars for the fiscal year ending June 30, 2009, from the general fund to the innovation partnership fund for the purposes of this act.

Appropriates the sum of five million dollars, or as much thereof as may be necessary, for the biennium ending June 30, 2009, from the state building construction account to the department of community, trade, and economic development for the purposes of this act.