[Congressional Record (Bound Edition), Volume 155 (2009), Part 15]
[Senate]
[Page 20382]
[From the U.S. Government Publishing Office, www.gpo.gov]




                          SMALL BUSINESS/SBIR

  Mr. DORGAN. Mr. President, I applaud the Small Business and 
Entrepreneurship Committee for their efforts in putting together a 
thoughtful, balanced reauthorization of the Small Business Innovations 
Research--SBIR--and Small Business Technology Transfer--STTR--programs.
  I know the committee is in negotiations with the House trying to 
reach a good reconciliation with the right parameters. I hope they do, 
so that we have these programs in place for years to come instead of 
another short-term extension.
  SBIR was set up in 1982 and requires 11 Federal departments and 
agencies like the Department of Defense, the National Institutes of 
Health and the National Science Foundation to set aside 2.5 percent of 
their research and development budgets for small businesses, which is 
over $2 billion per year. STTR sets aside another 0.3 percent of R&D 
for small businesses to work in partnership with university and 
institutional researchers. Both programs have been highly successful, 
helping propel small business growth, and develop and commercialize the 
innovations that are the backbone of our economy.
  I wanted to share a few facts about small business for the record.
  According to the Small Business Administration, small businesses 
annually create between 60 and 80 percent of the net new jobs in 
America.
  Small businesses produce on average 13 to 14 times more patents per 
employee than large patenting firms.
  Small business employs about 38 percent of the scientists and 
engineers in America, up from only 6 percent in 1978.
  Despite all this growth and stellar track record, small business 
receives only about 4 percent of Federal extramural research dollars. 
That needs to change. Small business has proven they can do Federal R&D 
as well as or better than large business, and they deserve more space 
at the table.
  Small business is going to be the engine that pulls the country out 
of this recession, like it has so many times in the past. Looking 
beyond the recession, small business will again develop the innovative 
technologies in which America consistently leads the world. The Senate 
bill wisely supports and extends our support for small business's role 
in growing a vibrant national economy.
  In my own State of North Dakota, SBIR has helped fund a number of 
innovations, and I wanted to mention a few of them.
  The Technology Applications Group of Grand Forks, located in the Red 
River Valley Research Corridor, invented the Tagnite coating system 
through Army and Navy SBIR funds. The technology allows the military to 
coat magnesium alloys for parts, ships, helicopters and airplanes in a 
way that is much less toxic than old processes, cuts down on corrosion, 
and saves on maintenance.
  Agsco of Grand Forks received an SBIR grant that led to development 
of the SCOIL and SUN-IT II products that enhance crop herbicide 
effectiveness. Agsco turned their SBIR grants into two products with a 
great deal of commercial impact.
  Dakota Technologies of Fargo has received multiple SBIR grants, 
including two that led to development of BEAM, or ballast exchange 
assurance meter, which measures ballast water in ships to make sure 
they don't contain harmful species or contaminants. BEAM is currently 
in a pilot program with the Coast Guard.
  Back in 2002, I secured funding to develop telepharmacy technology to 
connect pharmacists directly with patients and pharmacy technicians 
regardless of their location. Technologies like this have been a boon 
to rural communities because they allow them to compete on a level 
playing field with urban areas.
  The USDA just awarded Telepharmacy Concepts of Dickinson, ND, with an 
$80,000 Phase I SBIR award that will allow them to research whether 
telepharmacy technology could be used for medication therapy 
management, which is a way to provide patient education, increase 
medication compliance and improve health care outcomes.
  Praxis Strategy Group of Grand Forks has received SBIR awards nine 
times, including grants from the USDA to develop strategic processes 
like the High Performance Community Initiative and the Enterprise 
Homesteading Program that help communities, especially small 
communities, attract entrepreneurs, develop dynamic economies, and 
market themselves.
  While I am happy with the Senate reauthorization, I am concerned 
about some of the provisions in the House version we are trying to 
reconcile it with.
  First, the House bill opens participation in SBIR to companies that 
are majority-owned by venture capital firms. I have nothing against 
venture capital companies, but the small businesses that they own have 
already shown they can successfully attract capital in the private 
market.
  SBIR was intended to help small businesses without the connections 
available to do that. I think the House bill is trying to fix something 
that isn't broken.
  Second, given the long-term success of SBIR and STTR, I think it only 
makes sense to increase the share of agency funds set aside for small 
business as the Senate's bill gradually does.
  American business has changed dramatically since SBIR was created. 
Since 1978, the share of scientists and engineers working for small 
businesses has, as I said, increased from 6 to 38 percent. Funding for 
SBIR and STTR needs to increase to reflect that reality. I am concerned 
that the House bill keeps their allocations where they have been for 27 
years, despite the successful track record of the programs. Given the 
figures I have quoted previously, increasing the set-aside from 2.5 to 
3.5 percent is the very least we should do.
  Small business is the core of our country's economy, and we have here 
a program that has a strong track record of encouraging growth and 
innovation in that area. I urge the program's reauthorization with the 
principles of Senate bill S. 1233.

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