[Congressional Record Volume 155, Number 87 (Thursday, June 11, 2009)]
[Senate]
[Pages S6536-S6537]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                 SBIR/STTR REAUTHORIZATION ACT OF 2009

  Ms. SNOWE. Mr. President, I rise today to speak on support of S. 
1233, the SBIR/STTR Reauthorization Act of 2009, a bipartisan measure I 
recently introduced with Senator Landrieu. As former chair and now 
ranking member of the Senate Committee on Small Business and 
Entrepreneurship, I have long championed critical small business 
programs such as the Small Business Administration's Small Business 
Innovation Research, SBIR, and Small Business Technology Transfer, 
STTR, programs, which direct more than $2 billion in Federal research 
and development--R&D--funding each year to

[[Page S6537]]

small businesses across our nation to encourage them to innovate and 
commercialize new technologies, products, and services. Our legislation 
would provide key improvements to the SBIR and STTR programs, which 
were last reauthorized in 2000 and 2001, respectively.
  As our Nation emerges from this devastating recession, the worst 
since World War II, we must ensure that America once again brings to 
bear the kind of ingenuity, creativity, and innovation that made 
America and our free market economy the greatest, most powerful on 
Earth. Indeed, innovation is the ``space race'' of the 21st century--
only this time it is not the U.S. versus Russia; it is the U.S. versus 
every nation that is jockeying for the lead position and an economic 
foothold.
  The bill we have introduced will greatly help America win this race. 
It is structured upon a comprehensive measure that our committee passed 
unanimously, on a bipartisan basis in both the 109th and 110th 
Congresses. Our legislation includes commonsense enhancements intended 
to incentivize more small businesses to participate in these vital 
programs. The bill would increase the size of phase I program awards 
from $100,000 to $150,000, and phase II awards from $750,000 to $1 
million. It would also peg future award increases to inflation. These 
pivotal reforms represent a well-spring of indispensable technological-
fuel to the small business engines that drive our Nation's innovation.
  Since the SBIR program was created in 1982, small technology firms 
have received more than 77,000 awards worth approximately $24 billion. 
The SBIR program has tremendous job creation potential. A recent 
National Academy of Sciences study, which focused on firms winning 
phase II SBIR awards in fiscal years 1992 through 2002 found that, as a 
result of their SBIR award, small firms were able to hire an average of 
2.4 employees, retain 2.1 more, and over time these firms, on average, 
each generated 30 jobs.
  Our legislation would increase the SBIR allocation--currently 2.5 
percent of Federal agencies' extramural R&D funds--by 1 percent over 10 
years and double the STTR allocation over 5 years to 0.6 percent. By 
doubling the percentage of Federal R&D dollars that the STTR program 
receives each year, and increasing the SBIR percentage by 1 percent 
over 10 years, we will infuse another $1 billion into the small 
business economy. With our economy reeling, the SBIR and STTR programs 
are more essential than ever, if we are to capitalize on the 
groundbreaking capacities of our Nation's pioneering small businesses.
  While innovation in areas such as genomics, biotechnology, and 
nanotechnology present new opportunities, converting these ideas into 
marketable products involves substantial funding challenges. Many small 
businesses simply cannot afford the exorbitant cost of developing and 
bringing a product into the marketplace. In order to confront this 
challenge, this legislation offers a compromise solution to the venture 
capital issue that has recently divided members of this committee and 
the SBIR community. Last Congress, I worked with Senators Kerry, Bond, 
Lieberman, Coleman, and others, to develop a key compromise on this 
issue that would permit limited venture capital investment in the SBIR 
program.
  Our bill retains this bipartisan compromise and would allow limited 
involvement of firms majority-owned by venture capital companies in the 
SBIR program. Specifically, a maximum of 18 percent of SBIR funding at 
the National Institutes of Health and 8 percent at all other qualifying 
agencies may be directed to small firms majority-owned by venture 
capital companies. Our compromise was strongly supported by the 
stakeholder community, and is consistent with the recent findings of 
the National Academy of Sciences and Government Accountability Office 
regarding venture capital investment in SBIR awardees. Additionally, we 
leave in place well-established SBA ``affiliation'' rules designed to 
preserve the intent of the SBIR program by limiting participation to 
small businesses.
  Other key provisions in this vital legislation include the 
reauthorization and enhancement of my SBIR Defense Commercialization 
Pilot Program. Senator Kerry and I created this program in the 108th 
Congress to encourage the award of contracts to SBIR firms. In 
addition, we would offer this program to all other participating 
agencies. The bill also would reauthorize and increase funding from $2 
million to $5 million for the Federal and State partnership program 
which would allow each state--including Maine--to receive funding in 
the form of a grant to make available an array of services in support 
of the SBIR program.
  Now, more than ever, we in Congress must do everything within our 
power to help small businesses drive the recovery of our economy. It is 
imperative that we reauthorize the SBIR and STTR programs, particularly 
before the program terminates at the end of July. I look forward to 
working with my colleagues on both sides of the aisle to pass this 
vital measure in the committee and full Senate, as we move forward to 
reauthorize these vital programs.

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