[Congressional Record Volume 143, Number 137 (Monday, October 6, 1997)]
[Extensions of Remarks]
[Pages E1936-E1937]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




   SMALL BUSINESS PROGRAMS REAUTHORIZATION AND AMENDMENTS ACT OF 1997

                                 ______
                                 

                               speech of

                       HON. GEORGE E. BROWN, JR.

                             of california

                    in the house of representatives

                       Monday, September 29, 1997

  Mr. BROWN of California. Mr. Speaker, I rise in support of H.R. 2261 
and to thank the bipartisan leadership of the Committee on Small 
Business for their cooperation in folding H.R. 2429, as reported from 
the Committee on Science, into the bill currently before the House. I 
also would like to thank our committee's leadership Chairman 
Sensenbrenner, Chairwoman Morella, and Ranking Member Gordon for 
working so hard in the limited time we had available to us to make the 
STTR program a more effective resource for our Nation's small 
businesses.
  I would like to address my remarks today to the Small Business 
Technology Transfer [STTR] program amendments which were reported from 
the Committee on Science and folded into this legislation.
  The STTR program was begun as an experiment 4 years ago to help small 
businesses move ideas from our Nation's universities and national 
laboratories into the commercial marketplace. It is clear that this 
experiment has not been underway long enough to prove itself, and it 
needs to be extended for an additional 3 years. Hardly any of the STTR 
grantees have had enough time to move a promising idea to a commercial 
product or government purchase through the STTR process. It was also 
painfully clear during the committee's hearing on the STTR program that 
information is not available to answer the most basic question about 
the effectiveness of the STTR program or the SBIR program on which it 
was modeled. Witnesses did not have statistics available to them to 
counter the assertion that the STTR and SBIR programs are paying for 
research that the private sector would have been done anyway if the 
Government grants had not been available. The anecdotal evidence which 
was available to us suggests that the programs are providing major 
assistance to specific small businesses, but we have much to learn 
about the program's overall effectiveness. This situation must be 
rectified before the programs are extended again 3 years from now.
  The Committee on Science accepted an amendment offered by Mr. 
Sensenbrenner and me that may help solve this problem by bringing the 
STTR and SBIR programs under the Government Performance and Results 
Act, GPRA. Agencies will be required to develop performance measures 
for their SBIR and STTR programs, to collect information on the 
performance of grantees, and to analyze that data in light of program 
goals. Our committee report to accompany H.R. 2429 suggests a variety 
of possible measures which could be used for these programs. Each time 
agencies participating in STTR or SBIR submit a report under the GPRA 
Act, they will be required to

[[Page E1937]]

submit information on their SBIR and STTR programs as well. This should 
leave us with a firm basis in the future to look at these programs and 
to reform them as necessary.

  The commercialization component of the SBIR and STTR programs can be 
seen through the program's phases. Phase I is for defining an idea; 
phase II is for developing the idea to the point where it is useful 
commercially or to the Government. Phase III is the point where the 
programs' successes are harvested either through private sector 
commercialization or through Government purchases of products and 
services. These programs have a second goal of providing value to the 
Government, a goal which can be complimentary to the commercialization 
goal. If Phase I and II grants are coordinated with the agencies' 
priority research and development programs, agencies should have a base 
of relevant expertise in the small business community for the Phase III 
work to build on. We, therefore, hope to see future SBIR and STTR 
solicitations positioned in the mainstream of agency and interagency 
priority initiatives.
  Members of our committee continue to be concerned about the extreme 
concentration of SBIR and STTR grants in a small number of companies 
located in a few States. We know there are tens of thousands of small 
businesses throughout the country with high quality scientists and 
engineers on their staffs, many of which might benefit from SBIR or 
STTR participation. This will not happen as long as the program keeps 
awarding hundreds of grants each year to a handful of companies. We 
also wonder how companies can remain small businesses if they truly 
have the management capabilities to write hundreds of research 
proposals and to carry out dozens of research projects for the 
Government each year. If they really are moving the research results of 
all these projects towards commercialization, why aren't they becoming 
big enough to outgrow the program? Our legislation partially addresses 
this problem by requiring the SBA to perform outreach activities to 
encourage applications from a much larger and more diverse segment of 
the small business community. However, we did not have time in this 
authorization to agree upon more direct legislative solutions to the 
multiple awards problem. It is a problem that is serious enough that it 
should not be ignored any longer. We, therefore, urge participating 
agencies to be aggressive in broadening the base of program 
participants and warn agencies who persist in continually awarding many 
grants to the same companies to be prepared to show that these favored 
few companies are both adding value to the Government and aggressively 
developing markets for their research results.

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