[Senate Hearing 116-139]
[From the U.S. Government Publishing Office]


                                                        S. Hrg. 116-139

                 MOON LANDINGS TO MARS EXPLORATION: THE
                   ROLE OF SMALL BUSINESS INNOVATION
                       IN AMERICA'S SPACE PROGRAM

=======================================================================

                             FIELD HEARING

                               BEFORE THE

                      COMMITTEE ON SMALL BUSINESS
                          AND ENTREPRENEURSHIP
                          UNITED STATES SENATE

                     ONE HUNDRED SIXTEENTH CONGRESS

                             FIRST SESSION

                               __________

                             JULY 19, 2019

                               __________

      Printed for the use of the Committee on Small Business and 
                            Entrepreneurship

[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]


        Available via the World Wide Web: http://www.govinfo.gov
        
                               __________
                               

                    U.S. GOVERNMENT PUBLISHING OFFICE                    
38-871 PDF                  WASHINGTON : 2020                     
          
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            COMMITTEE ON SMALL BUSINESS AND ENTREPRENEURSHIP

                     ONE HUNDRED SIXTEENTH CONGRESS

                              ----------
                              
                     MARCO RUBIO, Florida, Chairman
              BENJAMIN L. CARDIN, Maryland, Ranking Member
JAMES E. RISCH, Idaho                MARIA CANTWELL, Washington
RAND PAUL, Kentucky                  JEANNE SHAHEEN, New Hampshire
TIM SCOTT, South Carolina            EDWARD J. MARKEY, Massachusetts
JONI ERNST, Iowa                     CORY A. BOOKER, New Jersey
JAMES M. INHOFE, Oklahoma            CHRISTOPHER A. COONS, Delaware
TODD YOUNG, Indiana                  MAZIE K. HIRONO, Hawaii
JOHN KENNEDY, Louisiana              TAMMY DUCKWORTH, Illinois
MITT ROMNEY, Utah                    JACKY ROSEN, Nevada
JOSH HAWLEY, Missouri
             Michael A. Needham, Republican Staff Director
                 Sean Moore, Democratic Staff Director
                            
                            
                            C O N T E N T S

                              ----------                              

                           Opening Statements

                                                                   Page

Rubio, Hon. Marco, Chairman, a U.S. Senator from Florida.........     1
Scott, Hon. Rick, a U.S. Senator from Florida....................     3
Waltz, Mike, Representative, 6th District of Florida.............     4

                               Witnesses
                                Panel 1

Cabana, Robert, Director, John F. Kennedy Space Center, Merritt 
  Island, FL.....................................................     6
Gustetic, Jenn, Program Executive, SBIR/STTR Program Management 
  Office, NASA Headquarters, Washington, DC......................    12

                                Panel 2

Rush, Andrew, President and CEO, Made In Space, Inc., Mountain 
  View, CA.......................................................    28
Nelson, Gordon L., Ph.D., Principal, Gordon Nelson and 
  Associates, Melbourne, FL......................................    38

                          Alphabetical Listing

Cabana, Robert
    Testimony....................................................     6
    Prepared statement...........................................     9
Gustetic, Jenn
    Testimony....................................................    12
    Prepared statement...........................................    14
Nelson, Gordon L.
    Testimony....................................................    38
    Prepared statement...........................................    40
Rubio, Hon. Marco
    Opening statement............................................     1
Rush, Andrew
    Testimony....................................................    28
    Prepared statement...........................................    30
Scott, Hon. Rick
    Opening statement............................................     3
Waltz, Mike
    Opening statement............................................     4

 
                   MOON LANDINGS TO MARS EXPLORATION:.
                       THE ROLE OF SMALL BUSINESS
                 INNOVATION IN AMERICA'S SPACE PROGRAM

                              ----------                              


                         FRIDAY, JULY 19, 2019

                      United States Senate,
                        Committee on Small Business
                                      and Entrepreneurship,
                                                Merritt Island, FL.
    The Committee met, pursuant to notice, at 11:30 a.m., in 
Room M6-306, Kennedy Space Center Visitors Complex, Hon. Marco 
Rubio, Chairman of the Committee, presiding.
    Present: Senators Rubio and Scott.
    Also Present: Mr. Waltz.

OPENING STATEMENT OF HON. MARCO RUBIO, CHAIRMAN, A U.S. SENATOR 
                          FROM FLORIDA

    Chairman Rubio. The Senate committee on Small Business and 
Entrepreneurship will come to order. I want to thank everyone 
for being here today. I want to especially begin by thanking 
our witnesses. I want to thank my colleague from Florida, 
Senator Scott, and Representative Waltz also from Florida, who 
are here serving as honorary members of the committee today as 
well. I also want to recognize a couple of our State officials 
that are here. State Senator Tom Wright and thank you for being 
here. My friend Debbie Mayfield, State Senator Debbie Mayfield. 
We have known each other for a long time. And also State 
Representative Thad Altman who I have also known for a long 
time. He is the CEO of the Astronaut Memorial Foundation, which 
is our host here today, and we want to thank him for that. I am 
pleased everyone can be here, and of course, a special thanks 
to the Kennedy Space Center for welcoming us.
    So the hearing today is about the role of small business 
innovation in America's space program, and since the 1960s, 
this Center has served as the world's leading human space 
flight launch center. There is frankly no more appropriate or 
more fitting place to mark the 50th anniversary of humanity's 
first steps on the moon than in this place, the place from 
which the Apollo 11 mission launched our brave astronauts. 
There is also no better place to look forward to what the next 
50 years of space exploration will require than here at the 
Nation's premier spaceport. It is from this place America 
launched the first human to the lunar surface, solidifying the 
United States as a dominant world leader in space achievement.
    And of course, there is no better place to examine the 
critical role of small business in America in space exploration 
than our State of Florida. It is the space capital of the 
world, and it is America's gateway to the stars. Fifty years 
ago, Neil Armstrong and Buzz Aldrin left mankind's first steps 
on the moon. The Apollo lunar landing and returning the 
astronauts safely back to Earth was the greatest technical 
achievement the world had ever seen. It was an astonishing 
testament to the spirit of American ingenuity, exploration, and 
courage. It was also a testament to the strength of America's 
commitment to national development. It took a nationwide 
dedication to our own innovation and advancement, to power and 
achievement as monumental as the lunar landing. It took 
partnerships between the government and private businesses 
working together to build possibilities that did not previously 
exist.
    The shared commitment that took us to the moon is essential 
if we are to remain the global leader in space exploration, and 
it is essential that America does remain the leader in space 
because there is a lot at stake. Our national security depends 
on American leadership in space and our continued innovation in 
space-based technology. The success of American space 
exploration is shared with our local communities. The Kennedy 
Space Center alone is responsible for approximately 20 to 3,000 
jobs here in the State of Florida. It contributes more than 
$3.9 billion in total economic impact to the State. When we 
consider aerospace in the context of national defense, the 
economic impact is even larger. Patrick Air Force Base, Cape 
Canaveral Air Force Station, and the Naval Ordnance Test Unit 
together account for over 47,000 jobs and over $5.3 billion in 
total economic impact in Brevard County alone. Florida is a 
global leader in the aerospace industry with dozens of 
innovative companies focused on manufacturing, commercial space 
flight, and aeronautics.
    Finally, I believe that great nations do great and 
remarkable things. I always tell the story of my grandfather. 
He was born in 1899 in rural Cuba. So if you think about, if 
you are born in 1899 in rural Cuba, there aren't even 
airplanes. You have never seen anything flying in the sky that 
is man made. And then in 1969, he watched an American step foot 
on the moon. And I recall him telling me that when he saw that 
image is when he knew for sure that Americans could do 
anything, and I think we all know him to have been right in 
that assumption. We have an obligation to our children to 
ensure that we are living up to that potential. Getting it 
right is not inevitable. Leading the advanced industries of the 
21st century is a necessity. Innovating our way back to the 
moon, and to Mars, and beyond, must be prioritized.
    Since the last time we visited the moon, research and 
development spending has fallen meaningfully. Our economic 
status quo has allowed too many advanced manufacturing jobs to 
depart our shores to places like China and elsewhere. China has 
dedicated itself to dominating the critical industries of the 
21st century, and one of those is space. We need to commit 
ourselves to catalyzing the kind of innovation that will 
maintain our technological edge and our leading role in space 
exploration. We need to commit to the big ideas that may seem 
impossible but are worthy investments, much like the ones made 
that took us to the moon over 50 years ago.
    Small businesses have always been critical to our efforts 
in space and will continue to be in the future. Numerous small 
businesses throughout the history of American space exploration 
have done the research and development to provide critical 
components that have enabled Americans to safely launch and 
return to the moon and back. NASA has expressed this commitment 
to partnership with small- and medium-sized businesses since 
its early days and it continues to do so now. I applaud NASA's 
recent decision to invest more than $45 million in innovative 
small business through its Small Business Investment Research 
Program. NASA also recently announced that it has awarded $106 
million for 142 Phase II proposals covering 28 States. These 
awards will help develop technologies that, among other things, 
will help humans live on the moon and Mars. The Small Business 
Innovation Research and Small Business Technology Transfer 
Programs are critical tools in strengthening the partnership 
between the Federal Government and innovative small businesses. 
These programs have been proven time and again as impressive 
examples of what investment in research and development by 
small businesses can accomplish. Because of these programs, 
firms like Made In Space, who we welcome as a witness today, 
have been able to pioneer the development of 3D printers to 
manufacture structures and microgravity.
    The Navy found in a study of their SBIR and STTR programs 
from the Fiscal Years 2000 to 2013 that $2.3 billion in 
investment into these programs generated an economic output of 
$44.3 billion--$2.3 billion generated $44.3 billion. That kind 
of return on investment is astonishing, and it is something 
that we should be encouraging as policymakers. The committee 
that I chair, this committee, is currently working hard to 
reauthorize our Nation's Small Business Act and modernize the 
programs of the SBA, including the SBIR and STTR programs. And 
chief among these improvements is making these outstanding 
programs permanent in law which will provide certainty and will 
improve their performance.
    Using the SBA to promote innovation, including in space-
related technologies, is indispensable if we are to return 
American development to where it needs to be at home and in 
space. America's future will be the result of ingenuity and 
investment of real assets, like the materials and components 
that small businesses have been innovating for the space 
program since its early days. If an American is to be next to 
walk on the moon, Mars, or beyond, he or she will do so as a 
direct result of our investment in small businesses and 
technologies that they can create.
    Now, I want to recognize Senator Scott.

   OPENING STATEMENT OF HON. RICK SCOTT, A U.S. SENATOR FROM 
                            FLORIDA

    Senator Scott. First it is great to be here. I want to 
thank Senator Rubio for hosting this here. Thank him and 
Congressman Waltz for their unbelievable commitment to NASA and 
for space exploration. I want to thank my predecessor Senator 
Nelson for his commitment to NASA. I want to thank my own State 
government.
    When I became Governor a little over eight years ago, 
manned flight had stopped here, thousands of jobs have been 
lost, and with Debbie and others, Thad and others' commitment, 
we invested over eight years $230 million to get more jobs 
here. And you can see the names of all of the buildings of 
these big companies like Blue Origin, and SpaceX, and OneWeb, 
and what they are doing is they are helping a lot of small 
businesses prosper. And a lot of--this is unbelievable the 
growth here and how we do not have enough engineers, which is a 
good problem.
    I want to thank Dr. Cabana for his absolute commitment to 
bringing in the private sector and making sure that this is a 
place that could prosper when we found out less expensive ways 
and more effective ways and faster ways to get to space. And it 
would not have happened but for Dr. Cabana's absolute 
commitment, so I want to thank him for that.
    I just had the opportunity to come visit the Visitors 
Center and the best thing out of it was I brought seven-year-
old and a five-year-old grandson, and I talked to my seven-
year-old--both of them couldn't believe I was not bringing them 
back today and told me how interesting this would be, and they 
would love to sit here for a couple of hours and listen to 
everything. But the seven-year-old told me that his plan is he 
is going to be the first person on Mars. And so that would be--
and as Governor my goal was that every kid in the State believe 
they could be anything, and so if we can get every child in 
this country to see the value of becoming the next astronaut to 
get to wherever, think about we are going to get, what is going 
to happen.
    So it is great to be here. I am on the Commerce committee. 
Mr. Bridenstine has already testified a couple of times. He was 
there last week. He is absolutely committed to making sure--as 
long as I know, everybody I know is absolutely committed to 
getting the funding to make sure we not only get to the moon, 
but we get to Mars as quickly as we can in a safe manner. By 
the way, my grandson said it is completely safe to go to space 
now. There is no risk.
    [Laughter.]
    So I am sure that is absolutely true. So it is great to be 
here, and I look forward to hearing everybody's points.
    Chairman Rubio. Well, I am glad to hear that because 
apparently, NASA is offering either you or I a chance to go to 
space because----
    Senator Scott. I thought that was my spot.
    [Laughter.]

   STATEMENT OF MIKE WALTZ, REPRESENTATIVE, 6TH DISTRICT OF 
                            FLORIDA

    Mr. Waltz. Well, thank you. Thank you, Senator Rubio and 
Senator Scott. I am joined today, I will embarrass her a little 
bit, by my 15-year-old daughter Anderson here in the audience 
and taking her through the launch sites this morning. Thank 
you, Bob, for your time this morning. Was just truly an honor 
as an American, as a soldier, as a businessman standing here 
where it all happened, this week, is really special, and thank 
you for holding us this week.
    You know, when I was reading the book Moonshot over the 
last couple of weeks and just realizing that when President 
Kennedy made his famous speech, his second State of the Union 
as it was called at the time, saying that we would go to the 
moon before the end of the decade, there was no rocket capable 
of doing it, there was no spaceship, heck, there was not even a 
computer small enough to power any of these things in the moon. 
And he ended up garnering--unbelievable now that I am in 
Congress--garnering the support of the Congress for the 
equivalent in today's dollars of $280 billion, 4% percent of 
our national budget to unify the country to be able to achieve 
such a great feat. It is just, I think, worth remembering, and 
it has certainly been inspiring to me and should be inspiring 
to all of us.
    That said, I do feel like as a member of both the Armed 
Services committee where I see the military side of what is 
going on in space, both on our side and our adversaries', and 
then also in the Space committee with oversight of NASA, NOAA, 
and the civilian side of space, I do feel compelled to ring the 
alarm bells to some degree. We are no longer alone up there, 
and we cannot take for granted American leadership in space.
    The Chinese and Russians have and are continuing to develop 
the ability to take down our infrastructure through anti-
satellite weapons, through killer satellites, through lasers, 
through different types of cyberattacks, and it is, I think, 
worth reminding everyone and continuing to educate everyone how 
the dependencies we have now in our own economy in 2019 that we 
did not have in 1969, from our banking system to our financial 
systems, to how things arrive in Walmart from around the world 
at a cost-effective price, and then of course from a military 
standpoint, the Russians and Chinese have stated explicitly, 
publicly that if we ever have any type of conflict, that they 
are not going to match us tank to tank or plane to plane, it is 
going to be the infrastructure in space that all of that 
depends on.
    It is also worth remembering that the Chinese do not have a 
NASA equivalent. Everything that they are doing in space has 
the Chinese military behind it. Their new space station, their 
plan to put a manned station on the moon, all will be there for 
military purposes. And it is not just them. The Indians are 
going to the moon. The Israelis are going to the moon. The 
Chinese and the Russians, of course, have done so and planned 
to do so. So the United States needs to step up.
    I think the Congress needs to step up, and we need to 
compete and lead. Part and parcel, and the tip of the spear for 
that leadership will be Florida, of course, and I think the 
engine will be the private sector. I also served as a small 
business CEO that competed and won and grew our company on 
government contracts. That was an incredible experience. Could 
also be a very painful experience. As I am looking a lot of 
people nodding around the room. I have walked the walk, whether 
it comes from bid protest to RFPs, to what it takes, I think, 
to be able to also serve through the private sector. What I 
love about the civil program at my company--we have 
participated in it--is everything that has come from it, from 
anti-icing to virtual reality, to surgical robots. So many 
amazing spin-offs have come from this program. And I thank you 
again for looking at how we can further it.
    And then finally I will just leave us with, we can never 
lose sight of the human capital piece of this. Just in the 
North of here, in my district, we have Embry-Riddle 
Aeronautical University, with the premier Aeronautical 
University in the world, Daytona State, which really focuses on 
the vocational pieces, but importantly STEM education and that 
STEM has to start before secondary school and has to start 
before higher education. It has to start in elementary school.
    There is an amazing Elementary School in Oak Hill just to 
the North of the cape called Burns Science and Tech where you 
have kindergarteners coding and building robots, and half of 
every class are girls. And we have to improve the diversity 
that is in STEM education.
    So America must continue to lead the bottom line. It is 
competitive space and this type of conversation I think is 
absolutely critical to that leadership and having that public-
private partnership be the engine for America's future in 
space.
    Thank you.
    Chairman Rubio. Thank you. Let me bring in the first panel 
here. Robert Cabana, the Director of the John F. Kennedy Space 
Center. He is our gracious host. Thank you for having us. He is 
responsible for all NASA facilities and activities, which as 
you can imagine is no small task, but he is also a veteran of 
four spaceflights. Has logged 38 days in space. He is a 
distinguished member of the Astronaut Hall of Fame and is a 
recipient of the distinguished Flying Cross. He was 
commissioned Second Lieutenant in the U.S. Marine Corps and 
completed Naval flight officer training in Pensacola in 1972. 
Thank you for being here and for allowing us to have this 
hearing. We also have Ms. Jenn Gustetic?
    Ms. Gustetic. Gustetic.
    Chairman Rubio. Gustetic. I practiced last night----
    [Laughter.]
    Is the Program Executive at SBIR, STTR Program Management 
Office at NASA headquarters. She served in numerous roles prior 
to this one, including serving in the White House Office of 
Science and Technology Policy. She is a graduate of MIT, but 
most important of all she is a graduate of the University of 
Florida.
    [Laughter.]
    Go Gators. Thank you for being here. So, Mr. Cabana, I will 
recognize you first for opening statements.

  STATEMENT OF ROBERT CABANA, DIRECTOR, JOHN F. KENNEDY SPACE 
                   CENTER, MERRITT ISLAND, FL

    Mr. Cabana. Chairman Rubio, thank you for the opportunity 
to appear today to discuss Kennedy Space Center's partnerships 
with the business community, especially small businesses as we 
enter a new period of space exploration with the Artemis 
Program that will take us forward to the moon. I have submitted 
a written statement for the record, but I would like to make a 
few brief remarks. NASA's John F. Kennedy Space Center is the 
Nation's preeminent multi-user spaceport for both government 
and commercial access to space.
    KSC's rich history dates back to 1962 when it was first 
established as the NASA Launch Operations Center. Our many 
accomplishments include those first steps on the moon whose 
50th anniversary we celebrate tomorrow, 30 years of space 
shuttle operations, the completion of the International Space 
Station, and very soon the return of U.S. astronauts to space 
on U.S. rockets from U.S. soil right here at the Key with our 
Commercial Crew Program.
    We have also played an integral role in NASA science 
missions, expanding our knowledge of the universe and our home 
planet. Today, Kennedy is an integral part of the local 
community, providing nearly 10,000 jobs for civil servants, 
contractors, tenants, and construction crews. NASA partners 
with more than 90 companies across private, academic, and 
public sectors, and small business is well represented in those 
partnerships. NASA has been charged with landing the first 
woman and next man on the moon by 2024 with the Artemis 
Program. Small businesses will play a critical role in our 
success as we move forward in partnership with our commercial 
partners, establishing a sustainable human presence on the moon 
by 2028.
    Using what we learned from the moon, we will take the next 
giant leaps, sending astronauts to Mars as we establish a 
presence in our solar system beyond our home planet. When I 
served as Commander of Endeavour on STS-88, the first space 
station assembly mission, I noted in the first log entry, from 
small beginnings great things come. Since then, the ISS has 
served as a world-class microgravity laboratory, a superb 
engineering testbed, and a model of international partnership 
for the future. Today NASA is opening the International Space 
Station for commercial business so U.S. industry, innovation, 
and ingenuity can accelerate a thriving commercial economy in 
low Earth orbit.
    Since the first log entry of the ISS and during my tenure 
as Director here at the Kennedy Space Center, I have watched 
many small beginnings grow into something greater. J.P. Donovan 
Construction was a small business started in nearby Rockledge, 
Florida. This general construction firm now specializes in 
aerospace steel fabrication and marine construction. They 
worked with the Exploration Ground Systems Program here on the 
refurbishment of historic Launch Pad 39B to support the 
upcoming test flight of SLS that will send the Orion spacecraft 
around the moon on Artemis 1. They also made significant 
structural modifications on the mobile launcher for the initial 
Artemis missions as well as installing the systems on it.
    J.P. Donovan Construction has been in business for 27 years 
now, and thanks to their work for NASA and KSC, they are no 
longer a small business. They have grown and now serve other 
defense contractors, port authorities, and local governments, 
including several beach restorations serving our coastal 
community. Our goal at KSC is to help small businesses navigate 
the world of government contracting and provide private 
industry with maximum business opportunities at KSC by 
increasing contracting competition and strengthening 
socioeconomic programs.
    KSC has exceeded all goals for the past two years, and NASA 
received an A grade on the most recent SBA small business 
scorecard. As of July 8th, KSC's total expenditure this year 
for small business is more than $159 million. The NASA's Small 
Business Innovation Research and Small Business Technology 
Transfer Programs fund the research, development, and 
demonstration of innovative technologies that fulfill NASA's 
needs and have significant potential for successful 
commercialization. These programs are vital to NASA and to our 
Nation's prosperity and security, and KSC is very proud of the 
role we play in helping these programs succeed.
    Mr. Chairman, Senator Scott, Representative Waltz, thank 
you for your time and attention this afternoon, and more 
importantly, thank you for support of NASA and America's space 
program.
    [The prepared statement of Mr. Cabana follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Chairman Rubio. Thank you.
    Ms. Gustetic.

   STATEMENT OF JENN GUSTETIC, PROGRAM EXECUTIVE, SBIR/STTR 
  PROGRAM MANAGEMENT OFFICE, NASA HEADQUARTERS, WASHINGTON, DC

    Ms. Gustetic. Chairman Rubio, thank you for inviting me 
here today to discuss the incredible impact that American small 
businesses are making across the country within the space and 
aeronautics industries. On behalf of the NASA SBIR and STTR 
programs, we are honored by the genuine commitment that members 
of this committee have shown to the American small businesses.
    Chairman Rubio, as you noted in your remarks, we are 
especially pleased to read your June statement applauding not 
only the $55 million in investment NASA will make this year 
through our Phase I awards, but more broadly the critical role 
that SBIR and STTR programs play in helping small businesses 
across Federal research and development funding. NASA's SBIR 
and STTR programs are key components of the agency's technology 
portfolio, which are managed by NASA's Space Technology Mission 
Directorate.
    At NASA, we like to say technology drives exploration. And 
as we all know, American small businesses and entrepreneurs 
drive innovation, transformation, and economic prosperity. Our 
path returning to the moon and forward to Mars will literally 
go through hundreds of small businesses across this great 
Nation. As the program executive for the SBIR and STTR programs 
at NASA, I have the privilege of overseeing programs designed 
to encourage small businesses and research institutions to 
develop innovative ideas that make specific research and 
development needs for the Federal Government and have 
significant potential for commercialization.
    Since the formalization of the SBIR program in 1982, NASA's 
SBIR programs have made over $3.6 billion in awards to small 
group businesses across all 50 States and Puerto Rico. With 
these awards, we fund an exciting frontier of technology 
interests across NASA, including human exploration, space 
technology, science, and aeronautics related investments. 
NASA's SBIR and STTR awardees have played a central role in 
nearly all of the agency's programs and missions. Currently, 
the SBIR and STTR programs are working with small businesses on 
their research and development to contribute to landing the 
first woman and the next man on the moon by 2024, followed soon 
thereafter by landing the first Americans on Mars.
    For example, Astrobotic, a space robotics company 
headquartered in Pittsburgh, Pennsylvania, was one of several 
companies selected by NASA to deliver demonstration payloads to 
the moon under the agency's Commercial Lunar Payload Services, 
or CLPS, contracts. Astrobotic is a successful multiple SBIR 
and STTR awardee that has been expanding operations and growing 
its team thanks in part to 16 NASA SBIR and STTR contracts it 
has been awarded since 2010. As our Nation reflects on the 50th 
anniversary of Apollo 11 and works toward a return to the moon 
surface, we at NASA recognize that we are in a new era of space 
exploration, one anchored by an emerging commercial space 
sector that includes cutting-edge companies growing and 
innovating at a faster pace than ever before.
    NASA's SBIR and STTR programs are critical in seeding the 
growing, emerging commercial space ecosystem while also bearing 
a responsibility and providing the patient capital for small 
businesses to succeed in bringing their innovative technologies 
to market in a high-cost industry. Our role is particularly 
important because the space industry can be a hard place for 
small businesses to work, requiring a significant investment of 
time, expertise, and resources to scale up.
    While many small businesses have achieved great success, it 
does not happen overnight. For example, Aurora Flight Sciences 
was selected for its first NASA SBIR award in 1990 and 
continued to work with the program for 26 years until being 
acquired by Boeing in 2017. Another 26-year-old NASA SBIR 
partner and recent notable acquisition, Honeybee Robotics, 
became a standalone, wholly owned subsidiary of Ensign Bickford 
Industries in 2017.
    For companies such as these, we serve as an important 
source of R&D funds and a forward-leaning resource available to 
small businesses looking to launch and scale their innovative 
products and technologies. These companies have leveraged their 
SBIR success to develop breakthrough technology and become 
industry leaders. We are living in an exciting time, a time 
that will see American astronauts return to the moon's surface 
and explore farther than they ever have before, but NASA cannot 
do this alone. Our programs will continue to look to the 
brightest minds and most innovative ideas in our country's 
small business community to bring Americans to the moon, to 
Mars, and safely back home.
    We know that we cannot do this also without the support of 
Congressional members and committees like this one. By 
including qualified small businesses in the Nation's R&D 
investments, high-tech innovation is stimulated, and the U.S. 
economy grows as agencies meet their specific R&Ds.
    Thank you to Congressman Waltz, to Chairman Rubio, and 
Senator Scott for your continued support of NASA.
    [The prepared statement of Ms. Gustetic follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Chairman Rubio. Thank you both for being here. I am going 
to keep my opening questions brief so I can get my colleagues 
in first, but I want to ask just to make it real for everybody, 
do you have any doubt that the first person to walk on the 
surface of Mars will be an American?
    Mr. Cabana. We are going to make it happen.
    Chairman Rubio. And is that American alive today? And if 
so, how old are they more or less?
    Mr. Cabana. Absolutely. So we will have to see. I would 
have to think about that, sir, but you know----
    Chairman Rubio. Are they in their teens?
    Mr. Cabana. They could be in their teens or younger.
    Chairman Rubio. The reason I am asking----
    Mr. Cabana. They could still be in school. This could 
happen--in the 2030s we are going to put Americans on Mars.
    Chairman Rubio. The reason why I asked you that there was 
a--you mentioned earlier from backstage before we started, 
there was a poll out that said that the number one profession 
the Chinese kids want to be is astronauts. The number one 
profession Americans want to be is YouTubers. I do not see the 
conflict with a YouTuber from Mars, right? But----
    [Laughter.]
    But I think that is our fault. I do not blame it on young 
Americans because we have not spent enough time outside of the 
confines of this debate in Washington talking about this. So it 
is important to go into our schools and our universities and 
tell people that the first person to walk on the surface of 
Mars is alive today in one of our schools and so we need them.
    And we need to do everything we can to be in that position. 
The second question I have is, will it be possible to execute 
that mission without the assistance of dozens and dozens of 
small and midsize businesses who find unique solutions to 
problems or things that we need to solve in order to make that 
mission possible?
    Mr. Cabana. No, I absolutely think that we have to have 
small businesses as part of this architecture with their 
innovative thinking, and they are going to be critical to our 
success. They will be a part of it. They are a part of it right 
now in these CLPS payloads that are going to the moon in these 
initial small landers gaining that knowledge in science, and 
they will continue to grow. So I totally agree with that, sir.
    Chairman Rubio. So I know the mission is still being 
defined, but can you just give us like an example of the kinds 
of things that you need to come up--some of you, as you walk 
through what it would take to put a human being in space on the 
moon, anywhere, for any extended period of time, the sort of, 
you may think them small but critical problems that emerge that 
people realize we have got to have a solution for this, and it 
may not be the big contracting famous company that goes out and 
solves it for you.
    Mr. Cabana. So, well, robotics was mentioned. We have one 
of our scientists here at KSC was working with them extensively 
on developing a drill to be able to drill for water on Mars, to 
drill down into the regolith to find the ice when they get to 
the South Pole and they have it work in those conditions.
    So that is one. You know, it is a lot easier to send probes 
than it is humans. As soon as you start sending humans, now you 
have got to provide a pressurized environment for them, give 
them oxygen, scrub the CO2, provide for food, take 
care of their waste, maintain the temperature, and having 
reliable systems that can do that. Especially if we are going--
you are talking a Martian mission right now with current 
propulsion technology, it is a year and a half to two years. It 
is like six to eight months to get to Mars, another six to 
eight months on the lunar surface, for another six- to eight-
month trip home.
    To have the systems reliable enough to do that, we have got 
a lot of work to do, and I believe that small businesses are 
going to be part of helping us innovate and helping these large 
companies be successful.
    Ms. Gustetic. Yes, and I will add to that and that if you 
look the Mars Curiosity Rover that is on the surface of Mars 
today, a number of SBIR companies that have technologies 
actually on that rover that are enabling critical science to be 
done on the surface of Mars, whether it is gearboxes, whether 
it is drills, whether it is just removal tools. We estimate 
that we spend roughly $9 million in SBIR awards that were 
leveraged with about $72 million of other NASA funding to fly 
six different companies solutions that enabled even more 
science to be done on the surface of Mars through our SBIR 
program.
    Mr. Cabana. And you know, if I could go, sir, real quick go 
back to your first question on motivating students. I get out 
and talk at a lot of schools, especially, you know, even at the 
elementary level, and I have not been to a school yet where 
every student was not engaged and excited when we talked about 
going into space, going to the moon, exploring beyond our home 
planet. So I agree with you. We have to get the message out and 
we have to show the art of the possible.
    Chairman Rubio. Yes. And the last question I have is, when 
you talk about these solutions, the drill, you know, the 
ability to manufacture in space because you cannot ship a 
replacement part over there, these things do not stay there. If 
you can drill on the surface of Mars, I imagine whatever it is 
you innovated, you are learning things that have applicability 
here on Earth. How those products transition over into 
commercialization and they actually lead to technologies that 
solve problems for us here.
    Ms. Gustetic. Yes, so SBIR companies at NASA drive a ton of 
what we call the spin-offs content that we talk about annually. 
So one of my colleagues that runs the tech transfer program at 
NASA publishes an annual spin-off publication that tells the 
stories of how NASA investments are actually transferred into 
technologies that we see in our everyday life, and in this 
year's edition of the spin-offs magazine, a third of those came 
from SBIT investments.
    And on average over the last five years, it is around 27 
percent of the things that we are seeing pop up and spin-off 
come out of the SBIR program for other applications.
    Chairman Rubio. All right, thank you.
    Senator Scott.
    Senator Scott. So, what do you need from Congress to be 
able to get to Mars besides--I know you need money.
    Mr. Cabana. Money and support. And primarily, we have to be 
funded properly if we are going to be able to do this. And you 
know, Senator Rubio mentioned earlier we were talking to 
Congressman. Waltz, you know, the Apollo program in today's 
dollars is $280 billion. Well, we know what we need to do to 
get back to the moon. We have to use the lunar surface, lunar 
operations to develop those systems that will allow us to get 
to Mars and it is going to be costly, but I think it is 
critical that we continue to expand, you know, the presence in 
our solar system beyond our home planet to explore and to 
learn. Every dollar that is--no dollar has been spent in space, 
they have all been spent here on the Earth enabling our 
economy, and growing it, and growing our technology to keep us 
a world leader.
    If as Senator Rubio said, great nations do great things, if 
we are going to remain a world leader, I believe we need to 
continue to lead in space. And we are looked upon as a world 
leader now in space and I do not want to lose that. And I think 
that showing that we can get to Mars, to make that happen, to 
develop the systems, to get the reliability, we need to keep 
humans alive and expand us to Mars is crucial and it is going 
to require proper funding to make it happen in a timely manner.
    Senator Scott. How do you determine whether it is--I mean, 
how do you decide what grants you are going to put out and how 
you are going to spend your money?
    Mr. Cabana. I am sorry, how we do what?
    Senator Scott. How do you decide how you are going to spend 
your money in these grants, and how do you measure whether you 
did a good job or not?
    Ms. Gustetic. So for the SBIR program, we go through an 
annual process where we develop what we call subtopics that are 
actually problem statements. And there are just a hundred 
problem statements of research and development needs that we 
know that either NASA has a loan or that the broader commercial 
aerospace industry has, and we pose a challenge to small 
businesses and we say, how would you solve this particular 
challenge through a Phase I feasibility study, and then 
potentially through a Phase I, Phase II prototype? And then a 
whole bunch of post Phase II investments that help those 
prototypes transition to increase their commercialization 
success because oftentimes a one single $125,000 Phase I and 
one single $750,000 Phase II is, you know, does not necessarily 
translate to a final product for the aerospace industry where 
things are quite expensive.
    So we do a lot post phase also to try to help companies 
transition their technologies, but there are a whole host of 
different problem areas and it is across NASA's whole 
portfolio. So we have challenge statements for science, for 
space technology, for aeronautics, and for human exploration 
ranging on almost any emerging technology area you could 
imagine, autonomy, UAVs, Eclipse systems. Anything that we do 
we likely have an SBIR subtopic to get small businesses 
involved in R&D.
    Senator Scott. What changes have you made in how you do the 
grants to make sure you are successful?
    Ms. Gustetic. Yes, so we certainly are consistently 
listening not only to our internal community of folks that are 
trying to solve particular problems through working with small 
businesses to ensure that we are able to get the most relevant 
problems on the street in a timely way to solve those problems 
in NASA, but also from the small businesses that participate as 
our solvers. Without the small businesses participating in the 
problem, we cannot be that matchmaker between the people that 
have the problems and between the people that have the 
solutions. So one thing that we started to do annually over the 
last few years is introduce an annual request for information 
process to our small businesses, seeking not only input on the 
problem statements we are asking for, but also on program 
processes and things that we could improve about the way that 
we conduct the process of our program.
    Senator Scott. So what type of grant have you done that you 
are most proud of?
    Ms. Gustetic. I think that recently the contracting 
vehicles that we have offered post Phase II. So we have 
expanded the vehicles that are available to actually, as I 
mentioned before, help to transition companies after a Phase II 
award to more commercial success. I think diversifying those 
vehicles that are available for companies to compete for, 
whether that is our Commercialization Civilian Readiness Pilot 
Program, it is one of the pilot programs, Chairman Rubio, under 
the SBIR authorization bill, whether that is sequential Phase 
II or Phase III awards. We offer many paths for companies to 
customize their path for commercialization, not assuming that 
it is a one-size-fits-all solution for companies. So I am 
particularly proud of the fact that we are diversifying the 
ways that companies can navigate our program, and not assuming 
that we have it all figured out, one path that companies need 
to take in order to commercialize.
    Senator Scott. What changes are going to happen at Kennedy 
Space Center to make sure we can get to Mars?
    Mr. Cabana. Make sure that the Kennedy Space Center what, 
sir?
    Senator Scott. That as a country we get people to Mars. 
What changes are you going to have to make here?
    Mr. Cabana. So at the Kennedy Space Center, our 
infrastructure is in place now. I believe that the 
modifications we have made to Launch Pad 39B, the new mobile 
launcher, the modifications in the vehicle assembly building, 
we will not be the reason that we do not launch SLS and Orion 
on time. That rocket needs to grow to have more capability with 
enhanced upper stage to get us to Mars. It is going to be a 
partnership with our commercial partners this time. It is not 
going to be a pure government operation. And what we have done 
to establish this multi-user spaceport, enabling these 
commercial companies the ability to launch in an environment 
where we have reduced regulations, we have worked closely with 
the Air Force and the FAA to make it more commercially friendly 
to make launches easier.
    I think having that environment in place is excellent. I 
think we need to continue to build on that, but we have the 
infrastructure in place. We are going to have to improve some 
of it. But we have what we need to get to Mars. We need the 
vehicles and the path forward.
    Senator Scott. Thanks. Thanks, Senator Rubio.
    Chairman Rubio. Thank you.
    Congressman Waltz.
    Mr. Waltz. Relatively briefly, Director Cabana, as I engage 
industry, they often refer to Florida space triangle, you know, 
between here and the Cape, up to Daytona and Embry-Riddle, over 
to Orlando. With the increased frequency of launch, the 
President's goals of a space force, lunar 2024, Mars, we are 
seeing industry locate to the area, which is fantastic.
    We are seeing, of North of here, we are seeing the 
development projects like Space Square. Can you discuss, or for 
either of you, why space triangle, this kind of a regional 
approach, is inevitable given the projected growth of launch, 
and how important is that to KSC's ability to execute NASA's 
goals?
    Mr. Cabana. So for us to be able to execute as a spaceport, 
I think, is critical. As we move forward, it seems that we have 
less and less of a discretionary budget. So enabling commercial 
operations--and it is not commercial space or government space, 
it is if we are going to be successful as a Nation, we need 
both of them integrated together. And I think the 
infrastructure that we are putting in place here as we draw 
these companies, and now as the prime companies come, the 
supply chain is following. And you know, the Space Coast is 
doing extremely, well a lot of it with partnership of the State 
of Florida.
    And in space, Florida is an economic development tool, and 
down in Melbourne with the aerospace industry picking up down 
there. This is the place to be. I mean, we came to the Cape 
back in 1962 because it was geologically in the right spot. It 
is close to the equator as far, as the United States goes, to 
have the orbital velocity help that you need. We are doing 
about 910 miles an hour right now sitting still. It also has 
the ability to launch with the ocean out to the East as a place 
for hazardous cargo to drop not on populated areas.
    So from a geographical point of view, it is an excellent 
place for a launch site. And now, as we have grown and made it 
more commercially friendly, I think is critical to our future. 
But again, it is not government or commercial. It is both of 
them integrated together to make us successful.
    Ms. Gustetic. Yeah, from a small business perspective, 
local and regional ecosystems are absolutely critical as I am 
sure you can appreciate. Small businesses need a village to 
support them as they grow and they develop and they scale, and 
money is not the only thing that is a determinant of a small 
business' success.
    So when you look at all the variety of services that are 
offered that are complementary to awards, many of which are 
offered by the Small Business Administration, things like their 
regional small business development centers, the vast programs 
that actually provide support for underrepresented communities 
to be able to apply to programs and get the support they 
needed, but also efforts that we have done in partnership with 
the Small Business Administration to go to the places that are 
actually lower applicant rates than other parts of the country.
    We participate in their Road Tours where we actually go and 
visit parts of the country that might have less participation. 
We have a Road Tour actually coming up this November in Miami 
and Puerto Rico, trying to go toward communities to actually 
bring the agencies to them as opposed to expecting them to 
figure us out, you know, the Federal Government out. So we also 
at NASA have prioritized trying to reach out to HBCUs and MSIs 
to increase their participation as research institutions in the 
program.
    So there are a number of different ecosystem services that 
are necessary to support a small business, and we see those as 
being critical to the long-term success of small businesses, 
not just our funding.
    Mr. Cabana. Every year, the Kennedy Space Center hosts a 
small business expo, and we work really hard on mentor-protege 
partnerships to help grow these small businesses but to help 
them understand how to do contracting here, and not just at the 
Kennedy Space Center, but with the government, and it is 
extremely successful every year and it continues to grow 
bigger. And we are very appreciative that Port Canaveral always 
offers up a facility to help host this. And it is--I think we 
do a good job.
    Mr. Waltz. Along those lines, can you just spend a moment 
talking about the apprenticeship program and how critical it is 
to pass on some of those technical trade to the Space Coast 
apprenticeship program?
    Mr. Cabana. So, right here in Eastern Florida, ASRC 
Aerospace research with Lockheed Martin has a program working 
with the university to intern and grow technicians to take 
over. For example, the tiles on the Orion spacecraft that is 
going to take astronauts back to the moon and on to Mars, our 
technology that was developed during the shuttle era, the tiles 
are made here at the Kennedy Space Center in our thermal 
protection facility. And the workforce to do that is aging, and 
it is as much an art as it is a skill, learning how to do it 
correctly. And so we are bringing in this apprenticeship 
program, these younger folks to take over and learn how to do 
this to be able to continue to build these spacecraft tiles for 
the future.
    Mr. Waltz. Just, last question. I think from my 
perspective, our job as a government is to create the 
infrastructure and the network for all of this to thrive, which 
I think is a fantastic example of public-private partnership 
and how that can grow rather than just throwing funding at a 
government agency. But we do have a responsibility for the 
infrastructure piece. Can you just talk to the Indian River 
Bridge and the space way connector and how important that is to 
keep funding going?
    Mr. Cabana. Absolutely. So right now, the Kennedy Space 
Center and NASA own the Indian River Bridge. Our gate used to 
be on the West Bank of the Indian River in order to get into 
the Kennedy Space Center in Merritt Island. Over time, we have 
drawn that gate back. We drew it back further when we created 
Exploration Park in partnership with the State of Florida, the 
research and development park that allows commercial companies 
to actually come here and be close to Kennedy in close 
proximity, but outside our secure perimeter.
    Over time, that bridge has become more than just access to 
the Kennedy Space Center. It has become a major thoroughfare 
for the community on North Merritt Island to and from the 
mainland, as well as a major hurricane evacuation route. It is 
also a bridge that is required for payloads from Titusville 
from Astrotech to get to both KSC and Cape Canaveral Air Force 
Station. That bridge is reaching the end of its useful life, 
and it has always been our plan to replace it. Currently, we 
are in partnership with Space Florida.
    During our furlough, we could not submit an info grant 
request in time and Space Florida submitted an info grant 
request to Department of Transportation for funding to replace 
that bridge. NASA currently is maintaining that bridge. I put 
about $2.5 million in a year to keep it operable. We paid for 
the design of the bridge that meets Florida Department of 
Transportation standards. We are paying for the environmental 
impact statement for the new bridge, and we are going to work 
with, if the State wins this grant, it will also require NASA 
funding in addition to Air Force funding. The State is only 
going to end up paying 20 percent or $20 million out of what it 
is going to cost to replace this bridge.
    I will get you the exact figure, sir. So we will see how 
the info grant turns out, but in the end, NASA, it is our 
responsibility. If we do not get this grant, we are going to 
have to find another way. In the meantime, we are going to do 
what is required to continue to maintain the bridge so that it 
allows access.
    It would be a shame to bring in all these commercial 
companies and create this great vibrant spaceport and not be 
able to have access to it with payloads and all the commodities 
that need to come from the outside in. So, yes, the bridge is 
critical to our future and we are working to have a proper plan 
to replace it that meets everybody's needs.
    Mr. Waltz. We will continue to work with your staff----
    Mr. Cabana. I am sorry?
    Mr. Waltz. We will continue to I think work with your staff 
to get that done, and then also the Halls River Bridge to the 
North of here heading up----
    Mr. Cabana. That is another one. We spend a lot of money on 
State Road 3 on the North part of Merritt Island on the refuge 
that is also going to need to be replaced in the not-too-
distant future.
    Mr. Waltz. Thank you. Senator, I yield.
    Chairman Rubio. Thank you. And just to close the loop, a 
couple of you just mentioned Space Florida. As an editorial 
statement, but I remember back when the shuttle program ended 
and there was the real fear, and we got 10,000 jobs sort of 
vanished overnight, and there was a real fear that this part of 
our State would kind of be left behind. There was real concern 
about the future and a lot of people ended up moving too 
because of it.
    And you look at just the figures up to 2017, we do not have 
the latest here, but almost 9,000 jobs have been created, many 
more that are ancillary, and there has already been national 
media coverage of the sort of resurgence of the area. And I can 
just--an editorial statement, the Governor was there for much 
of the period of time. In fact, this whole period of time that 
we are talking about, Space Florida. Without Space Florida, 
they deserve a tremendous amount of credit as really a model 
for the country to keep this part of our State and our Space 
Coast with its head above water while we at the Federal level 
sort of figured out what was next. And had that work not been 
done, it is quite possible that this hearing and all these 
conversations we are having today would be, may be, occurring 
somewhere else in the country.
    And so I think they deserve a tremendous amount of credit. 
I know you have a great partnership with them. I wanted to ask 
you about the Pentagon, the Department of Defense, because NASA 
and Apollo trace its roots back to military spending. The 
majority of the astronauts, I think going back to Mercury, 
Gemini, Apollo, they all served in the military, had also 
served in the military.
    There is also a component of the small business contracting 
that is tied to the defense industry. And how is their synergy 
there with hypersonics, their own space ideas? I mean, separate 
from the NASA program, is there not also spin-off and ancillary 
and sometimes direct benefit at some of the small business 
endeavors that are being pursued through that funding stream at 
the Department of Defense?
    Ms. Gustetic. From the SBIR perspective, we see a lot of 
handoffs between NASA awards and Department of Defense awards. 
Many companies that work with us also work with a particular 
part of the Department of Defense, and oftentimes the DOD also 
piggybacks off of our awards and will offer second Phase II 
awards to companies that we funded the Phase I or the Phase II. 
So, and we see them do a lot of Phase III on our Phase I and 
Phase II because there is certainly technology areas that are 
of mutual interest.
    Chairman Rubio. Sounds like a good argument for why we need 
the space force to be in Florida.
    [Laughter.]
    But the--I'm sorry, Ms. Gustetic, let me ask you about, you 
know, one part of what we are trying to do is with 
reauthorizing the Small Business Administration, two decades 
since we have done that, and is that the programs that we are 
discussing expire in 2022. So a lot of these, and the stuff 
that people are going to be--a lot of these endeavors that 
people are undertaking need some patience. They take some time. 
And the uncertainty about whether--if you get closer to 2022 
and we do not reauthorize this program, what is the practical 
impact it begins to have on folks coming forward and looking to 
be a part of it?
    Ms. Gustetic. It has an impact not only on the Federal 
agencies that pre-plan for those activities but also on 
regional ecosystems that plan and create positions, for 
example, to help companies that are local to them prepare for 
these kinds of funding opportunities. It also certainly affects 
companies that may not know if this funding resource will 
actually be as predictable as it has been historically. We hear 
all the time from our small businesses, and also from other 
countries, that will come and talk to us to learn about how the 
small business program in the U.S. works, where they say just 
how much of a gem this 37-year-old program is. That the United 
States is a consistent, predictable, repeatable source of 
funding for small businesses on the innovation side of things. 
They actually develop new and advanced technologies.
    And so the predictability of that funding, even if there 
might be a little bit more bureaucracy associated with applying 
and also complying with contract terms, the predictability of 
that funding is something that diversifies the overall 
availability of money in the ecosystem, whether it is also 
angel investing, venture capital, and other sources of funds, 
that make it a really critical and important player in the 
ability for our small businesses in this country to thrive.
    So that permanence increases predictability and it can 
allow a whole ecosystem of other support services to form 
around that permanent and predictable program in order to 
better leverage it.
    Chairman Rubio. And the last question I have really has 
more, not NASA specific, but it is part of our bill. One of the 
things we want to do is, and right now this is all housed under 
the Office of Investment and Innovation, and our view in our 
bill we are trying to do is bifurcate that we are going to sort 
of leave the Office of Investment, but then create a separate 
office for innovation and technology, put these programs with 
its own so that it has its own specialized focus and attention 
paid on it.
    And I do not know if you have any thoughts or views on how 
that could or could not impact the program. I know the SBA will 
have its own views about how to staff and how to fund it, but 
just having an office that is dedicated to that sole mission of 
innovation and technology, and technology transfer peace. Would 
that in your view be helpful to helping the program be more 
successful and do you have any views on that?
    Ms. Gustetic. I think anything that enables that SBIR 
program to get direct connections to their leadership to 
increase the support that they continue to have in their 
programs is likely a positive thing. The SBA, we work with them 
on the policy directive that they issue and also the activities 
that they do on behalf of all the agencies. It does not make 
sense for all ten of us to do our own individual outreach 
efforts. That is not the best use of our money.
    So we work together to--actually, an SBA coordinates those 
things. We work together with them in order to get the best use 
of the money that you are giving us. And so, their ability to 
operate at a high level and an innovative level just makes all 
of the other agencies able to execute at a higher level as 
well.
    Chairman Rubio. Well, thank you both for being here. I 
appreciate it very much. Thank you for hosting us, and we look 
forward to working with both of you in the months and years to 
come. And tomorrow will be a big day. I will be around here as 
well, so, but again, thank you both for coming here. I am going 
to start introducing the second panel. Thank you. And so let me 
introduce the second panel while the staff here transitions the 
name tags. Our second panel, Mr. Andrew Rush of Jacksonville, 
Florida, is the President and CEO of Made In Space, Inc., which 
specializes in manufacturing in space and other extreme 
environments. He holds a Bachelor of Science and Physics from 
the University of North Florida, and a Law Degree from Stetson 
University. I have got to ask you about that. You know, the 
physics and then philosophy your brain is like, you can stretch 
in two very different directions there. But thank you for being 
here.
    Dr. Gordon Nelson is a Principal at Gordon Nelson and 
Associates in Melbourne, Florida. The Gordon Nelson Associates, 
working with the Florida Institute of Technology, has been a 
recipient of NASA SBIR, STTR awards, and I want to thank both 
of you for being here, but we will start with you, Mr. Rush. 
Thank you. You are recognized for your opening statement.

  STATEMENT OF ANDREW RUSH, PRESIDENT AND CEO, MADE IN SPACE, 
                    INC., MOUNTAIN VIEW, CA

    Mr. Rush. Chairman Rubio, Senator Scott, and Congressman 
Waltz thank you for the opportunity to speak with you today. 
Fifty years ago, American innovation put American boots on the 
moon for the first time.
    Today, American innovation in space, driven by emerging 
companies like Made In Space, is alive and kicking today. We 
and our fellow innovators are ready to progress beyond Apollo, 
not only putting humans back on the moon to stay and on to Mars 
but revolutionizing the way the spacecraft are built and 
creating sustainable commercial business operations in low 
Earth orbit.
    As CEO of Made In Space, I have the great honor of leading 
a talented and passionate team and support international 
exploration goals. We are an industry leader in developing and 
deploying space-capable manufacturing technologies, a suite of 
technologies that will enable more capable, cost-effective in-
space operations and make human spaceflight missions safer and 
more responsive. Made In Space has been able to achieve 
multiple world's first because of the support of space 
technology development programs led by NASA, DARPA, and others.
    As a young bootstrap company, our approach has been to take 
small practical steps toward our goal of opening the frontier 
of space via manufacturing. As we have talked a little bit 
about today, after initially demonstrating 3D printing in 
microgravity via NASA's Flight Opportunities Program, Made In 
Space was granted a series of SBIR contracts, allowing us to 
work with Marshall Space Flight Center and others to build and 
launch a 3D printer to the International Space Station in 2014.
    Since manufacturing its very first parts, we have been 
manufacturing tools, and fixes, and other objects for use by 
the ISS crew and others. This capability is paradigm-shifting 
because it reduces the need for costly spares and allows tools 
and fixes to be manufactured on the spot on demand. Consider 
the life-threatening calamities that befell Apollo 13 or the 
fictional tribulations of Mark Watney in the Martian. Now 
consider that if the crew of Apollo 13 had had a 3D printer 
onboard, they could have more readily repaired their 
CO2 scrubbing system, and perhaps had Mark Watney 
been provided with 3D printers and other manufacturing tools, 
that book would have been a little bit more boring and his 
survival might have been, you know, not quite so heroic.
    Without infrastructures like the SBIR program and the 
International Space Station, we could not have developed this 
capability, a capability which will make future human space 
flight missions safer and more responsive than ever before. 
Building on the success, a Made In Space-led team began work 
for NASA's Space Technology Mission Directorate to develop a 
large-scale, in-space additive manufacturing, and assembly 
system. We call the system Archinaut.
    Archinaut technology will enable optimization of spacecraft 
structures for their operational environment rather than 
primarily designing them simply to survive the ride to space. 
This technology enables providing large structures at lower 
costs, including robotic manufacture, and assembly of 
reflectors, space stations, and other applications for civil 
defense and commercial space customers. STMD has recently 
funded the first Archinaut satellite for flight. This satellite 
will prove out this foundational technology in the operational 
environment, establishing the flight heritage that will enable 
mission managers to confidently integrate this technology into 
operational human spaceflight, national security, and 
commercial missions in the future. The SBIR program enabled 
transformational ideas like 3D printing in space to go from the 
drawing board to demonstration in space.
    The vision of NASA's Space Technology Mission Directorate 
to invest in disruptive technology, like in space robotic 
manufacturing and assembly, will enable satellites to one day 
self-assemble and repair and augment. In the future, this 
technology will transform how we build spacecraft, opening 
after for human and robotic exploration of the cosmos, and 
enabling commercial space operations to get more capability per 
kilo sent to space. Made In Space and its customers have 
benefited enormously from the virtuous cycles of development 
enabled by a strong SBIR program, a strong independent STMD, 
and DARPA, and others. Made In Space strongly encourages NASA 
to look more to small businesses to serve integral roles in 
taking the United States back to the moon and on to Mars via 
their technological innovations.
    Hand in hand with that, Made In Space encourages increased 
investment in space technology development, in particular, 
increasing support throughout the technology development 
pipeline of mission-enabling technologies will minimize the 
risk that at early stages of development these technologies 
languish. These investments are crucial to achieving America's 
near-term ambitions in space and avoiding being overtaken 
militarily or peacefully by China and others in space.
    This committee is uniquely positioned to extend the legacy 
of Apollo and help propel the Nation back to the moon and on to 
Mars by unleashing the time-tested power of American small 
business innovation.
    Thank you.
    [The prepared statement of Mr. Rush follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Chairman Rubio. Thank you.
    Dr. Nelson.

STATEMENT OF GORDON L. NELSON, Ph.D., PRINCIPAL, GORDON NELSON 
                 AND ASSOCIATES, MELBOURNE, FL

    Dr. Nelson. I appreciate this opportunity to provide 
comments on the role of Small Business Innovation in America's 
Space Program. My comments are based upon my experience on a 
NASA STTR, which began in 2012, focusing on new, flexible, 
flame-retardant polyurethane foams for energy absorption 
applications. That STTR has progressed through Phase I, Phase 
II, Phase II E, and now in Phase III. Polyurethane foams can be 
items such as seat cushions, mattresses, all of which you are 
very familiar. However, significant flame retardancy is 
required in high hazard seating, Navy mattresses, and many 
other applications.
    This STTR project represents the development of a unique 
family of highly flame retardant, environmentally friendly, 
flexible polyurethane foams. The flame retardant package is 
nonhalogen, chemically bound-in, meaning it is non-migrating, 
with low volatiles, resolving key concerns for environmental 
stakeholders. The goal was to exceed the flame retardancy of 
BX265, NASA SOFI spray-on foam insulation for the shuttle that 
had a peak rate of heat release of 354. Project foams perform 
down to 148 peak rate of heat release, less than half that of 
SOFI, and over 90 percent reduction versus the base foam. Foams 
meet Cal 133, British Standard 5852, standards for high-
hazardous seating, the Federal standard for mattresses, Cal 129 
and NFPA 267 for high hazardous mattresses, and the FAA oil 
burner test for commercial aviation seating, without additional 
fire barriers.
    All foams, of course, meet NASA's 6001 test method. Some 
foams meet the U.S. Air Force dynamic cushioning test for 
packaging. Foams can be made to any needed static stress 
performance, useful for energy absorption foams in automotive 
or aerospace applications. Some members of the family show 
enhanced cryogenic insulating performance versus SOFI at soft 
vacuum. Thus there is a broad family of potential performance. 
Part of the NASA vision was flexible insulating foam which 
could be used for cryo line repair yet serve a variety of other 
applications during a mission. Indeed, project foams provide 
cost-effective, flexible polyurethane foams for cryogenic 
insulation, packaging, energy absorption materials, and flame 
resistant materials, including high-hazardous seating and 
mattresses, energy-absorbing foams, packaging foam, and 
anechoic chamber materials.
    NASA likes applications beyond NASA mission materials. 
During Phase III, working with several leading companies, we 
have focused on foams for prison mattresses, rail car seating, 
automotive headliners, and anechoic chamber materials. Using 
the automotive headliner materials as an example, current 
headliner composite, now think of your automobile, is a fabric 
of foam behind it and polyethylene film barrier behind that. It 
must meet the flammability requirement of the motor vehicle 
safety standard, MVSS302, utilizing a flame retardant fabric. 
As one, however, goes to an autonomous vehicle, a more pleasing 
environment will be needed versus the few colors currently 
available for headliners. Flame retardancy will no longer be 
met by the fabric, but MVSS302 performance will need to be 
provided by the 3 to 4 mm of foam.
    So our project materials, in fact, can do that. The project 
has been very productive. I do have the following comments 
based upon my seven-year STTR experience. The project had a 
commercialization panel using three internationally recognized 
consultants with polyurethane formulation, application, and 
standards of regulation experience. Several times at NASA 
briefings the question was raised, well, why commercialization 
panels were not required. Well, maybe they should be.
    I served as the Small Business Concern, the SBC, for the 
project. Florida Institute of Technology served as the Research 
Institute, the RI, for the project. STTR requirements allowed 
the RI 40 percent of project funds and the SBC 60 percent. It 
is up to half for consultants and at least half spent as 30 
percent directly by the SBC. This allowed me, as a sole 
proprietorship, to function effectively.
    However, some STTRs and SBIRs require the SBC to have at 
least 50 percent of project direct expenditure which 
effectively excludes sole proprietorships. We had that issue 
with an Army SBIR. That is my first concern. STTRs many times 
involve universities. The RI, in this case, Florida Institute 
of Technology, involved 14 students, 6 M.S., and 8 
undergraduate students, in the project. Five of the six M.S. 
students were women, and three of those were Hispanic. Students 
have commented that they appreciated the exposure to real 
industrial applications as part of their project work, having 
the responsibility to meet real project goals and timelines.
    One should not forget that STTRs offer a great opportunity 
for student experience and exposure. Indeed, the lead M.S. 
student, Caitlin McKinnon, has had great exposure in managing a 
project research group. During Phase I, under $125,000, the SBC 
needed to front $60,000 to $70,000 since expenses are billed 
after the fact by quarter. That is difficult for sole-
proprietorships and would be particularly so for younger 
entrepreneurs. A Phase I upfront initial payment would be 
useful and encourage new innovation. So that is a 
recommendation.
    I was approached on several occasions by individuals at 
other institutions about being the SBC on their projects. Their 
issue was the time necessary to complete the System for Award 
Management Registration Project, SAM. Hearing about a potential 
award topic and being able to respond with the required 
documentation limits some people with clear specific expertise 
to respond.
    In my case, I have been doing work at Kennedy Space Center 
for a good number of years. But, someone starting fresh would 
find it difficult to accomplish registration in the time and 
context of a specific project submittal deadline. That clearly 
limits fresh innovations. So, I hope these comments have been 
helpful. The STTR project over the last seven years has been a 
whole lot of fun.
    Thank you for your attention.
    [The prepared statement of Dr. Nelson follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
    
    Chairman Rubio. Thank you. I guess, Mr. Rush, let me ask 
you, in May Made In Space was selected for two SBIR of Phase II 
awards that could be worth about $1.5 million each. If you 
could just describe to people that are not as aware of the 
program how support from the SBA, and this program, in 
particular, has helped you grow to this point as a company.
    Mr. Rush. Yeah, absolutely. So we have been very fortunate 
to win, I think, over a dozen Phase I and Phase IIs throughout 
the eight- or nine-year period that we have grown as a company. 
We really started with SBIR, with just an idea, and you know 
received our first Phase I, and from there received Phase II 
and Phase III actually simultaneously to put printers on the 
ISS. And from there, you know, have been able to expand out 
that technology space into multiple different areas.
    So like those two SBIR Phase II we won recently, one of 
those is focused on a structurally interconnected 
interferometer in the small satellite that is going to be 
manufactured using our space-capable 3D printing technology, 
which was the subject of our first SBIR, to make an 
interferometer that can spot near-Earth objects if it was put 
up in space in a really small form factor.
    The other SBIR that we won there is in what we call the 
space-enabled materials area that, you know, is going to 
manufacture a process class in orbit that because it was made 
microgravity, it has these really interesting and economically 
viable properties.
    So, and we think that is the key to multiple businesses 
manufacturing in space that are making, you know, that are 
profitably manufacturing things in space that we are using back 
here on Earth, which ultimately we think will be the anchor 
tenants for commercial space stations and modules in low Earth 
orbit, which is, you know, which is the low Earth orbit goal of 
the post ISS future.
    And all of that has been enabled, you know, by a really 
great relationship with NASA and with the SBIR program. Without 
SBIR, we probably would not have accomplished the things that 
we have accomplished. We certainly would look really, really 
different.
    Chairman Rubio. Well, Dr. Nelson, and for you Mr. Rush, 
both, how would you make SBIR better, easier for other 
companies like yourselves to get into this to do what you have 
done? What could we do to make it even easier and better than 
it is now?
    Mr. Rush. Two things come to mind, and both have to do with 
speed. As a small business, you know, speed and cash are king. 
So the time period between submittal of a proposal and notice 
of award, and then, you know, getting on contract, the more 
effort that can be spent to compress those timelines the 
better. And then----
    Chairman Rubio. What are they typically now?
    Mr. Rush. Six months, you know, six months to get onto a 
six-month contract, and then similarly between Phase I and 
Phase II. So phase I's are typically six months and Phase II is 
typically two years. There is a gap of three to six months. You 
know, you put a proposal into the end of the Phase I and then 
you wait three to six months to find out if you won, and then 
to get on contract.
    And you know, that is a challenge from a cash flow 
perspective of you are sort of speculating and saying, okay do 
we think this is going to win, do we keep these folks available 
for this project, or do we put them on something else? And if 
that time period was compressed or if there was no gap, I think 
that would enable the program to be that much more effective.
    Chairman Rubio. Dr. Nelson, do you have any suggestions on 
how to make SBIR even better?
    Dr. Nelson. I would certainly agree with Andrew in the 
issue between the transition between phases. That is, you know 
when you have a team and you have no money for some months, 
that is clearly a problem.
    Chairman Rubio. But, why do they tell you it takes longer 
than you hoped it would? What is your sense of why it takes so 
long or longer?
    Mr. Rush. I think across multiple agencies, that is the 
structure. It is between Phase I and Phase II, you submit your 
proposal for Phase II at the end, and then there is, you know, 
an evaluation period, and then there is a negotiation period, 
and then you get on contract for the Phase II. So that is I 
think just kind of the cadences of the program as it is 
currently structured.
    Chairman Rubio. Meaning this is the way they have always 
done it. You know, it is just kind of built into the way it is 
handled. That is the culture of the program.
    Mr. Rush. Right, right. And you know, and so we as a small 
business, you know, we adapt to those rhythms, and, you know, 
with via close relationships with the technical folks that we 
work with try to get a feel for if that is the direction we are 
going to be able to continue to go. But that is certainly a 
challenge from a forecasting perspective.
    Chairman Rubio. Senator Scott.
    Senator Scott. So, what is the benefit of Kennedy Space 
Center, NASA's contract with a small company versus a large. 
Why should they do business with small companies?
    Mr. Rush. Historically, as I have kind of mentioned 
earlier, small businesses are the epicenter of innovation in 
America, right. Small businesses are, you know, are extremely 
capable and sustainable innovation, and where large companies 
are good at are very capable, it is the same sustainable 
innovation.
    And going forward to the moon to stay and on to Mars, we 
have to have new ways of doing things, new mission 
architectures, new technologies to be able to go and stay. The 
way that we have traditionally done, you know, human space 
exploration has been some camping trips. And what we need to do 
is more like pioneering. We need to go and have manufacturing 
technologies to allow us to adapt to the circumstances that 
exist, you know, and eventually be able to sort of live off the 
land.
    You know, the ISRU and other technologies. And you see that 
creativity in small business, you know, not to deride our 
friends at larger companies, but that is where you see a lot of 
innovation, and I think we work really well with larger 
companies, where they can say, hey, this is the well-trodden 
path that we have gone down and small business can say, hey, 
have you thought about doing it this way, and then work very, 
very well together.
    Dr. Nelson. And I think the other cases, and certainly, we 
were one of those, where we have expertise test facilities, so 
forth, that really very few other people have.
    Senator Scott. Have you--when you got these grants from 
Kennedy Space Center, has it allowed you to raise private 
money?
    Mr. Rush. So as a company, we have never taken diluted 
outside capital. We have been fortunate to grow by our 
customers. The SBIR program has enabled us to diversify our 
client mix. Actually, when we put our first 3D printer on the 
space station, the second one we put up was a commercial 
printer, and at the time we launched that, we had over a year 
of commercial customers including like Fortune 500 companies 
and large aerospace companies who were signed up to utilize 
that device. So we have been able to, you know, commercialize 
that very, very quickly because of SBIR.
    Senator Scott. So, how about you, Dr. Nelson?
    Dr. Nelson. In our case, we are looking to transition our 
technology to in fact large companies for the applications that 
I talked about. And so that is really our focus. Simultaneously 
with that is looking at our technology and how can that 
technology meet other critical needs.
    Senator Scott. So how have each of you been able to move 
outside of just the government contracting into the private 
sector? Have you both been able to do that?
    Mr. Rush. So one of the ways that we have been able to move 
out, you know, into the private sector, is building on our 
expertise in developing manufacturing technologies that work in 
a zero-gravity environment. We have developed one and now we 
have multiple payloads in development with our own money or 
with other private money to make these kinds of space-enabled 
materials.
    So we have actually launched four times a payload that 
makes an exotic optical fiber called Z Bland on the 
International Space Station, and this is actually the first 
kind of commercial industrial utilization of the space 
environment to make a product that because it was manufactured 
in space, it has got really, really valuable properties. And we 
have both follow-up projects to make bigger and more capable 
payloads to make more of that material, as well as just explore 
other potential space-enabled materials going forward.
    Dr. Nelson. For us, the vision of the project was, in fact, 
broad utilization of the technology and thus the importance, 
from really day one, the commercialization panel, international 
experts who really have the understanding of the use of these 
kinds of materials in a broad industry application. And so we 
have done that from the beginning, and we have in Phase III--
Phase III, in fact, is commercial industry-funded, not 
government-funded, and looking for some very specific high-tech 
applications that will utilize our technology.
    Senator Scott. So the money you have received from NASA, do 
you think NASA has gotten a good return?
    Mr. Rush. I would hope so. You know, we have been able to, 
you know, just in very practical terms demonstrate technologies 
that have accelerated technology road maps with manufacturing, 
you know, in space and that kind of local real-time 
manufacturing, and how many catalogs that, hey, if this breaks 
we can just print this part rather than in bringing more and 
more spares and taxing our mass budgets that much more.
    That has really been a, you know, really been a kind of 
align shift that we hope our friends at NASA have benefited 
from. And similarly, with our Archinaut technology, that is a 
truly transformational technology for how we are going to 
approach manufacturing and assembling satellites. You know, and 
going forward, you know, one day we think that maybe the sort 
of successors to James Webb, you know, will be manufactured and 
assembled in orbit in a much more, you know, efficient fashion 
and a much more reliable fashion than maybe we can currently 
accomplish.
    Dr. Nelson. Materials are enablers and thus what NASA in 
fact wanted was materials that could have multiple 
applications. And so yes, you have a flexible polyurethane foam 
that can be used to repair cryo lines rather than the hazard of 
using a spray insulation in space, but simultaneously with 
that, you have a material that can be used for a whole variety 
of other applications.
    For example, I mentioned packaging and meeting the Air 
Force packaging standard. So yes, I think they have not only 
got their money's worth but beyond that given its commercial 
utilization, one has it at a price of a couple of dollars a 
pound. In fact, it is very affordable.
    Senator Scott. What would you think if NASA said the next 
time, they said, I am going to give you a grant, but I am going 
to take out royalties if you use anything you have learned from 
this if you use it for the private sector. What would you think 
about that?
    Dr. Nelson. But in fact, we are doing that under 
confidentiality agreements with a number of key potential 
users. So we are actually doing that.
    Senator Scott. So NASA has a royalty interest?
    Dr. Nelson. NASA would not have a royalty interest. That is 
the NASA royalty is based upon any NASA application is royalty-
free. But the small business may, in fact, get royalties on the 
basis of private sector use.
    Senator Scott. If you were spending--if you were given the 
money out of your NASA, do you think they should ask for a 
royalty?
    Dr. Nelson. No, I think that increases the complexity, 
which is already complex enough, and I think the key for NASA 
is in fact that they are able to use those materials for their 
applications in a very cost-effective way. And I think what it 
does is decrease the cost for them when we can get it out into 
the commercial sector.
    Mr. Rush. So we have been very fortunate to grow, you know, 
in double several times in the last, you know, last four or 
five years, and we have taken the long view and said, hey, we 
have this great technology and we are really fortunate we have 
some really smart folks on our team that are able to invent 
these great things, but we want to get to product. We want to 
get to the capability. We want to change the way, you know, 
broad-based satellites are manufactured for government and for 
commercial. We want to make human spaceflight missions safer 
and more reliable through in-space manufacturing.
    And as such, we take basically every dollar that we have we 
plow it back into the business, to grow the business more 
aggressively and to do internal research and development to 
help move the needle on this technology. And our partners at 
NASA generally, and the SBIR program specifically, have been 
great allies in that endeavor. I would view--I think that 
taking a royalty in that technology would serve as a drag on 
that, you know, on a scaling-up because rather than us being 
able to take that money and put it back in the business to grow 
bigger and faster, you know, that money would be diverted 
somewhere else.
    Senator Scott. Thank you. Thanks, Senator Rubio.
    Chairman Rubio. Congressman Waltz.
    Mr. Waltz. Thank you, Senator. I want to commend you both 
for, you know, as an entrepreneur as well for just sliding 
everything that you ever thought you owned, planned to own, 
aspire to own, and you know across the table for a product, for 
an idea, for a service, that you believe in. Mr. Rush. I do not 
see how we get the quantities of stuff that we need back and 
forth from Earth. We have to manufacture it in space in terms 
of getting to the moon, getting to Mars, and really getting the 
infrastructure that we need up there.
    I want to take a step back for a moment and go back to 
human capital and, you know, on the one hand, I have five great 
universities in my district producing a lot of STEM talent and 
other talent, vocational as well, but I also hear from a lot of 
manufacturers, a lot of industry that they cannot find the 
skills that they need. We would love for you to share your 
experiences in terms of your human recruiting and what you are 
seeing out there in the workplace.
    Mr. Rush. The very first job I had in the space industry 
was working for this really small rocket company called Masten 
Space Systems in Mojave, California, which Mojave is in the 
middle of the desert in Southern California, and some of the 
other space companies out there kind of joke that one of the 
things that folks do is when they hire people out there and 
they bring their spouses, they see how much their spouses cry 
at, you know, being in this little like you know one truck stop 
town. But people go and work in Mojave and they come and work 
in this industry, in this economy, more generally because of 
the incredible transformational capability and potential that 
we have.
    We believe that what we are working on and the space 
economy, you know, has the potential to be as disruptive to our 
daily lives in America both from a military perspective and 
from a fiscal perspective as, you know, sort of the e-commerce 
revolution. And because of that, as a small company we have 
been able to find and, you know, attract talent and retaining 
talent as we have grown. It is absolutely essential that, you 
know, programs, you know, from kindergarten through post-
secondary education encourage people to understand STEM and 
view it as something that is accessible.
    You know, in my hometown of Jacksonville we have a really 
prolific FIRST Robotics team that, you know, from elementary on 
getting folks really involved in that. And I think those things 
are really, really important. The other thing that I think is 
important from a workforce development perspective is focusing 
not just on the engineering jobs, but on, you know, on all the 
disciplines it takes to run a successful business and to grow a 
successful business. It is just as important for us to have 
really talented finance folks as it is to have really talented 
engineers.
    Mr. Waltz. I am from Jacksonville as well, Mr. Rush. Just 
great to see such talented entrepreneurs coming out of there. 
Dr. Gordon, anything?
    Dr. Nelson. Yes, and I think that is where perhaps STTRs 
are a little more special particularly with a university as the 
SBIR. As I said, in our program, we have had fourteen students. 
All but one of those, in fact, has become an engineer. And as I 
said, of the six Masters students involved, five of those have 
been women so that one, STTRs I think are special. And that in 
fact, the students have commented that they appreciated the 
exposure to real industrial applications with the 
responsibility of real project goals and real timelines.
    So they are getting a chance to see all of that. And one 
student, the lead Master student, in fact, has done a fantastic 
job in managing a project group and learning how to do that. 
And so I think that STTRs really have a great opportunity to 
extend STEM into the real world and get students excited about 
it.
    Mr. Waltz. Well, thank you. One other questions, Mr. 
Chairman.
    Chairman Rubio. Yes, of course.
    Mr. Waltz. If time allows. I want to follow up with what 
Senator Scott was kind of pressing on in terms of put yourself 
in NASA shoes, put yourself in the government's shoes, there 
are a lot of reasons we have these types of hearings and our 
oversight role. You know, in hearing from industry, what would 
you do different? I have so far cash flow. Cash is king and I 
know it is brutal when one we don't have it, and two when you 
cannot predict when you are going to have it.
    So if I hear you correctly, Dr. Nelson, providing those, at 
least those very initial small grants upfront. If I heard you 
correctly also, getting away from SAM registration in terms of 
speeding. I don't know how we would get around that. Maybe some 
regulatory exemptions. I am not sure if I hear you properly 
there.
    Dr. Nelson. Correct. I think it may well be a regulatory 
exemption but certainly looking at the process and how can one 
ensure that those who are not already in the grant business 
can, in fact, bring their special technology to bear on the key 
agency needs.
    Mr. Waltz. But that is exactly what I--that is kind of what 
I wanted to get into my last question. So there are a number of 
companies out there that have the expertise and have products 
that NASA and the military need in spaces.
    Is there anything else that you can think of and how to 
pull them kind of into the ecosystem, that would make it more 
attractive, easier? I know in my own experience, I recall a 
study from Ernst & Young that anyone seeking to do business 
with the government had to add anywhere from 20 to 30 percent 
in overhead to handle all of the regulatory requirements. While 
we all have each other here, is there anything else that you 
recommend?
    Dr. Nelson. I think focusing heavily on the sort of post 
Phase II directions of things is important. As we heard 
earlier, you know, there is Phase II E, there is sequential 
Phase II. There is, you know, lots of other tools available. 
But there existed, you know, sort of technology wasteland, 
right. You know, these really great transformational 
technologies that you know, bought for and, you know, paid for, 
a few million dollars more or a few hundred thousand dollars 
more, and from a space technology perspective, that is a huge 
opportunity for improvement. That if we can smooth the path and 
provide multiple paths up that TRL ladder to get to not only to 
higher, you know, prototype technologies, but to get to flight 
heritage technologies. I think that that would be an area to 
really, you know, an area worth exploring and improving.
    Mr. Rush. I think my concern is on the start side. And that 
is, how do you help young entrepreneurs, how do you help young 
academics, get into the process in a speed that they can do and 
without the initial cash investment, which they can't do? So, 
you know, whether that is a special program or not, perhaps, 
but I think there is--you know, I have been in academia for a 
long, long time, and I know there are a lot of ideas that are 
really beyond the cutting edge. And I think a question is, how 
can you tap those? How can you get those more quickly into the 
NASA and other government agency utilization? And that is 
really my concern.
    Mr. Waltz. Thank you. Thank you both. Senator, I yield my 
time.
    Chairman Rubio. You know, just to close the loop, I think 
people would be shocked at how much of the things that we deal 
with every single day began as a government research project to 
solve a space, national security, or scientific need. So, you 
know all the press clippings about Uber and Lyft and all that, 
they would not exist without GPS technology that was first 
innovated, I think it was a DARPA project. Same thing with the 
internet. The internet started as a government project. There 
are others. I wrote a list here. The first programmable 
computer was not made by Apple or by Microsoft and some you 
guys, it was the result of a government need for optical 
scanners. Apparently low-fat mozzarella cheese. I do not know--
--
    [Laughter.]
    So, maybe I should have left that one out. But the point 
being that these are all, and it strikes me that some of the 
things you are both talking about doing have extraordinary 
commercial application, but they also have DOD applications as 
well.
    I want to use as an example. I would imagine if you were 
deployed halfway around the world, it is going to be a lot 
easier for troops in the field or major craft carrier to solve 
a problem it has by being able to carry enough raw material to 
manufacture on board and spare a part that they need or 
solution they need than it would be to have it shipped there. 
The logistical challenges of getting things there. Likewise 
with the materials that you were talking about, Dr. Nelson.
    So I want to talk a little bit about the DOD part of it. 
Now, we are in the NASA facility that we have already outlined 
how they interplay with one another. I think that DOD is about 
half--my notes say about half of SBIR awards, but it continues 
to experience sort of a shrinking industrial base where we are 
seeing more and more of the procurements are going to, a larger 
piece is going to less and less contractors, large contractors. 
I wanted to ask you both, have you had experience and what has 
your experience been doing the SBIR program with the DOD, the 
Department of Defense?
    Mr. Rush. So to your point about, you know, having local 
manufacturing being something that could be really helpful to a 
warfighter, one of the interesting things that we found when we 
developed the 3D printer for the space station is that making a 
printer that can survive a rocket and then operate in space 
means that you also have made a printer that you can put on 
like a submarine or in a small draft vessel at sea and have it 
successfully operate----
    Chairman Rubio. Or an oil rig?
    Mr. Rush. Yeah, or an oil rig. Exactly. So those are areas 
that we have explored some and, you know, done some initial 
testing on, but I think to another one of your points that we 
do see on the DOD side, you know, perhaps a larger percentage 
of the pie being driven by very large contractors. So the 
transition sometimes from, you know, from NASA SBIR and 
development over to DOD or from, you know, tech to operational 
can be a significant hill to climb.
    And, you know, the fact that we are, you know, making that 
hill easier to climb would be really great. Likewise, we have 
also done some good work on SBIRs for Air Force and for DARPA, 
and their cycles are a little bit different than NASA. You 
know, they have maybe more frequent cycles, but generally, you 
know, during, those processes have been very good and kind of 
system-focused rather than component-focused
    Chairman Rubio. Dr. Nelson.
    Dr. Nelson. Yes, I mentioned an army SBIR, and basically 
what that was all about was a small inner line. And so if you 
have a vehicle and you have a shell coming into it, it is the 
metal that hits the spall liner and that is to stop shell 
fragments from going on around the vehicle. The whole idea is 
to have an inner liner. So whatever happens to that vehicle, 
the vehicle tumble, so forth, you now have a flexible inner 
liner which will be an energy-absorbing material. So you will 
have less injury of those people inside the vehicle.
    So our material could have played, in fact, a role. Or as I 
mentioned, since it was an SBIR in DOD, you had the company 
needed to spend 50 percent of project direct expense. Well, 
that immediately excludes the sole proprietorship. So we then 
had to go out, get a company that would be the SBC, very 
interesting company but did not have the direct spall liner 
relationship that we in fact had. So I think there is an 
example were setting something up that does not allow certain 
kinds of companies to participate simply limits innovation.
    Chairman Rubio. In the Phase III part of the program, where 
you can there is some opportunity for sole source, which is a 
huge back-end carrot that draws people into the program and no 
longer involves the direct funding, it is a contract if by 
chance you got it, but we have heard, at least that on the DOD 
side, many of the small businesses say they have mixed results 
with the contracting officers. Some of them know about it. Some 
of them don't or they are not as fully informed about all the 
attributes of the program. Have you had that experience with 
DOD or anyone for that matter in your work? Either one?
    Mr. Rush. Yeah, we certainly experienced varying levels of 
education at the contractor level about----
    Chairman Rubio. Just to let people know, this is the person 
at the agency or the branch or whatever that is your liaison, 
your inner interface.
    Mr. Rush. Absolutely. So we have had very varying 
experiences there because it is a powerful tool not just for us 
as a small business, but for, you know, for folks within a 
given agency trying to accomplish things, right, to say, hey, 
we can avoid the competition process, we can just sole source.
    You know, not only that but we have also had some times we 
run into issues where, you know, with the SBIR law says that if 
you have a technology that extends, derives, or completes work 
that was done on an initial Phase I, you should go back to that 
first SBIR awardee and have them do that work unless you can, 
you know, tell your SBIR, here is a reason why not. Those two 
things. We have seen varying levels of education, and sometimes 
folks really educated about that and other times, you know, 
other times there are some opportunities for improvement there 
that could lead to things maybe not being accomplished in the 
ways that they might otherwise be accomplished or going slower 
than we would otherwise like.
    You know, from a NASA perspective and from a DOD 
perspective, like going fast is really crucial right now. We 
are--China is out publicly saying, hey, we are going to in-
space manufacture and assemble giant solar ray farms and, you 
know, we want to get back to the moon and stay, you know, and 
by 2024. Both of those are things where we cannot, you know, we 
do not have the luxury of missing some quarters as it were.
    Chairman Rubio. Dr. Nelson.
    Dr. Nelson. I really don't have a comment.
    Chairman Rubio. So, let me ask you about my last question 
for both of you, and this touches on the large, but I think 
small businesses and mid-sized businesses have a special 
problem with this potentially.
    We are all aware you invent something unique and there are 
companies and countries out there that specialize in finding 
out what it is you are doing and reverse engineering, and all 
of a sudden you wake up one day and realize even if you have 
never done business in that country, that either someone stole 
it from you through a cyber intrusion, or you had an employee 
that gave it to them for money. It happens all the time. So it 
would be interesting if the American taxpayer is helping you an 
American company build this capacity that is in our national 
interest, and we have done all this work and taking all the 
risk, and all of a sudden we wake up one day and we find that, 
for example, China is doing what we do, except their company is 
funded and backed by the government and so they are now 
competing with you in the commercial space with the advantage 
of not having to initial make a profit so they can drive the 
price down and force you out.
    Do you feel you are properly postured, and do you have the 
defenses that you need against whether it is a cyber intrusion 
on the intellectual property--I know what the law is about. You 
know, patents and protecting things legally. We know how well 
that works in parts like China and other places. Do you both 
feel like you have what you need to protect yourself whether it 
is a cyber intrusion or insider transfer, and how real risk is 
that moving forward? And how much do you think about that?
    Mr. Rush. So I think what you have just described as a CEO 
of a small company, it is something that I think about, but it 
is also something that we almost view is as unchangeable as the 
weather, right. That is the environment that we operate in, 
that we play in.
    And there are folks within the government that, you know, 
on a sort of an ad hoc basis have reached out to us and said, 
hey, you are in this emerging technology field, here are best 
practices, and I think that is really, really great. Perhaps 
like systematizing that and focusing that on SBIR would be 
prudent one day, but really our approach to that is our 
approach to any competitor, to any competitive, you know, 
outside force, which is to just go as fast as we can, and trust 
our team, and trust the innovations that we have, and 
ultimately do our best to be successful that way.
    Chairman Rubio. Any comments, Dr. Nelson.
    Dr. Nelson. In our case, and with chemicals materials, is 
that we are not doing patents, we are doing trade secrets. The 
reason we don't do patents is the purpose of patents is to give 
away the technology.
    Now, these polyurethane foams are very complex technology, 
which is very difficult. In fact, to do analysis to find out 
really how they are made is just what the constituents are, but 
how you do it. And so from a technology protection standpoint, 
it has been trade secret and working with companies only after 
a nondisclosure agreement. And so certainly that has been 
working very well for us.
    Chairman Rubio. And one of the areas, to close the loop on 
it, that we have been concerned about is small and midsize 
businesses are facing nation-state level cyber threat, but do 
not have nation-state, much less large corporate cyber 
defensive posture capability because of the cost associated 
with is real costs. I mean, we have some of the largest 
companies in America having massive data breaches. So just 
imagine how difficult it is for someone who is busy innovating 
and spending all their time, energy, and resources on making 
something.
    And so we have seen numerous cities and municipal entities 
in Florida be held hostage, had to pay ransom, to someone 
probably from North Korea in order to get their records back.
    So it is an area that we filed some legislation on that we 
do want to sort of incorporate as part of what we are doing 
because it is a 21st century threat. You don't even have to 
have somebody here. You can get into the network because it 
could be as simple as somebody clicking on an attachment that 
they shouldn't, and obviously we want to make sure that we can 
figure out the best way as part of these programs to also 
protect it, because these technologies are also in our 
competitive advantage and some cases are not just trade 
secrets, they are in our national interest, potentially our 
national security interests to become a significant strategic 
advantage. Anyone have anything else?
    [No response.]
    I want to thank you both for being here. I think it has 
been insightful and helpful. Congratulations on your success, 
and we look forward to seeing you both again. Thank you.
    Again, I want to thank Congressman Waltz, my colleague 
Senator Scott for being here today as part of this hearing. As 
I said, we are moving over next week to hopefully reauthorizing 
all of this. So a lot of these comments that we have gotten 
here today are going to be very helpful in that regard. And I 
want to, of course, thank all of our witnesses and our two 
panels for being a part of this.
    The hearing record will stay open for two weeks. You may 
get some questions from my colleagues around the country that 
are not here today. We only ask if you could answer them just 
because they become part of our record and we point to this 
when we do legislation, we point to testimony and things that 
are said to justify why we are for something or why we are 
against something, so it is helpful. That record is going to 
stay open for two weeks so any statements or questions for the 
record are going to be submitted by the 2nd of August at 5:00 
p.m.
    Thank you again. With that, the hearing is adjourned.
    [Whereupon, at 1:15 p.m., the hearing was adjourned.]
  

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