The Wisconsin state Legislature and Gov. Jim Doyle are feeling the pressures of a $5.4 billion deficit for the 2009-11 budget, and a new report released Wednesday could intensify the strain.

The report, “The Economic Value of Academic Research and Development in Wisconsin,” highlights the state’s decrease in spending overall for higher education within the past 25 years.

It urges the state to reconsider its future budget decisions to salvage not only educational institutions but also the $1 billion academic research and development industry.

According to the report, academic research and development is vital to creating highly successful entrepreneurial activity in the emerging “knowledge economy.” The report warns if state spending for higher education continues its downward trend, Wisconsin’s educational system will find itself in a very precarious economic position.

While state appropriations in 1997-98 stood at nearly 33 percent, or $880 million, the state shrank it’s spending to approximately 24 percent in 2006-07, according to the report.

“I think the education commitment by state government has got to be primary right now,” Director of University of Wisconsin’s Research Park Mark Bugher said. “The framers of the Constitution years ago envisioned a state committed to education on all levels, and I think that ought to be the first stop in the budget.”

Bugher added he thinks this report will carry significant weight when legislators look to make cuts to state entities in the upcoming budget.

“By and large, [legislators] like to see measurable accomplishments before they make investments,” he said. “This report certainly reinforces the notion that there is a substantial payback for the investment that legislators and the government make.”

Rep. Kim Hixson, D-Whitewater, said while the state is definitely in a budget crisis, research being conducted is receiving a considerable amount of funding from outside sources, including the federal government and private foundations.

“There are a lot of outside dollars that come in,” Hixson said. “That said, we have to be willing, as a state, to fund professors to have relief time from classes so they can do this research. There are also physical needs like the laboratories and the computers that have to be funded.”

According to the U.S. Department of Commerce and the Bureau of Economic Analysis, the billion dollars spent in 2007 on the academic research and development industry translated to 38,376 jobs — both directly and indirectly.

Hixson added while academic research and development is an essential component to increasing knowledge, its economic impact on the state cannot be ignored.

“When these businesses are either created here or located here because of the wonderful world-class university that we have, that brings more jobs,” Hixson said. “We as legislators, but also as a state, can save a dime today, but it might cost us a dollar a year from now.”

According to Mike Mikalsen, spokesperson for Rep. Steve Nass, R-Whitewater, the main priority for the Legislature and Doyle needs to be undergraduate education and not necessarily academic research and development.

“It’s not that any legislator is against academic research and development,” Mikalsen said. “Clearly in tight, tough times when middle class students can’t afford to go to school, we have to decide where limited tax dollars are going to go.”

The economic stimulus bill, passed by the U.S. House of Representatives Wednesday, will work to increase affordability for students throughout the state by increasing tuition tax credits.

Rep. Spencer Black, D-Madison, said the general public does not often recognize research, but it is a significant export industry for Wisconsin that needs funding.

“I think that [the stimulus bill] will be a significant benefit to the university and Wisconsin in general,” Black added.

President Barack Obama is currently working to get the Senate to approve the bill so he can sign it before the end of February.