The governance of California’s new US$3 billion institute for stem cell research, which was approved by voters last November, has come under attack for insufficient transparency. An appointed oversight committee of 29 people will decide how to allocate the funds based on the recommendation of three working groups. These groups are not required to have public meetings and their members are not required to disclose their business ties. "It is like a legislature that meets openly but with committees that are totally secret," says Terry Francke, of California Aware, a lobby group for open government. "In essence, you will have public money secretly spent by private decision makers."

The Silicon Valley developer and lawyer who masterminded last year’s campaign to create the institute, Robert Klein II, has been appointed the chairman of the oversight committee. This came as no surprise because the law approved by the voters stipulates that the chairman must have a history of stem cell advocacy, experience in state government and bond trading. Mr Klein was a perfect fit.

Journalist Stuart Leavenworth, of the Sacramento Bee, complains that the fine print of Proposition 71 makes public scrutiny of the Institute very difficult. "The business leaders who pushed this initiative are accustomed to the confidentially of the boardroom. Academics like the anonymity of closed-door tenure reviews. Some want stem cell research to occur in the same sort of opaque fish bowl," he says.

Despite the difficulties of administering government-funded research, politicians in four states on the Eastern seaboard want to pour money into stem cells to keep scientists from packing their bags for California. The Democratic leader of the New York state senate has proposed a 10-year US$1 billion bond issue. "Many, many jobs will be lost otherwise," says Senator David Paterson.

New Jersey has already committed itself to spending $150 million to set up its own stem cell institute and will vote on an additional US$230 million bond issue in November. Massachusetts legislators are eyeing tax incentives. A bill allowing stem cell research narrowly failed in Connecticut’s legislature last year, but its backers believe that they can push it through in 2005.

The cutting edge of stem cell financing is in Illinois. Opponents of embryonic stem cell research managed to quash a proposal last year, but supporters have come up with a new idea: a six per cent tax on face-lifts, liposuction and Botox injections which would fund $100 million a year for stem cell research. As a luxury tax, this will affect only 2% of the population, says Illinois Comptroller Dan Hynes. No doubt the idea furrows the brow of 100% of cosmetic surgeons.

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