[Senate Report 106-382]
[From the U.S. Government Publishing Office]



                                                       Calendar No. 758
106th Congress                                                   Report

 2d Session                      SENATE                         106-382
                                                               _______________________________________________________________________

                                     



 
              TECHNOLOGY ADMINISTRATION AUTHORIZATION ACT

                               __________

                              R E P O R T

                                 of the

           COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                                   on

                                S. 1407



                                     

                August 25, 2000.--Ordered to be printed

   Filed under authority of the order of the Senate of July 26, 2000
       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
                       one hundred sixth congress
                             second session

                     JOHN McCAIN, Arizona, Chairman
TED STEVENS, Alaska                  ERNEST F. HOLLINGS, South Carolina
CONRAD BURNS, Montana                DANIEL K. INOUYE, Hawaii
SLADE GORTON, Washington             JOHN D. ROCKEFELLER IV, West 
TRENT LOTT, Mississippi                  Virginia
KAY BAILEY HUTCHISON, Texas          JOHN F. KERRY, Massachusetts
OLYMPIA SNOWE, Maine                 JOHN B. BREAUX, Louisiana
JOHN ASHCROFT, Missouri              RICHARD H. BRYAN, Nevada
BILL FRIST, Tennessee                BYRON L. DORGAN, North Dakota
SPENCER ABRAHAM, Michigan            RON WYDEN, Oregon
SAM BROWNBACK, Kansas                MAX CLELAND, Georgia
                       Mark Buse, Staff Director
                   Ann H. Choiniere, General Counsel
               Kevin D. Kayes, Democratic Staff Director
                  Moses Boyd, Democratic Chief Counsel
                Gregg Elias, Democratic General Counsel



                                                       Calendar No. 758
106th Congress                                                   Report
                                 SENATE
 2d Session                                                     106-382

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




              TECHNOLOGY ADMINISTRATION AUTHORIZATION ACT

                                _______
                                

                August 25, 2000.--Ordered to be printed

   Filed under authority of the order of the Senate of July 26, 2000

                                _______
                                

       Mr. McCain, from the Committee on Commerce, Science, and 
                Transportation, submitted the following

                              R E P O R T

                             together with

                            ADDITIONAL VIEWS

                         [To accompany S. 1407]

    The Committee on Commerce, Science, and Transportation, to 
which was referred the bill (S. 1407) ``A Bill to authorize 
appropriations for the Technology Administration of the 
Department of Commerce for fiscal years 2001, 2002, and 2003, 
and for other purposes'', having considered the same, reports 
favorably thereon with an amendment in the nature of a 
substitute and recommends that the bill as amended do pass.

                          Purpose of the Bill

  The purpose of the bill, as reported, is to authorize 
appropriations to the Technology Administration (TA) of the 
Department of Commerce (DOC) for fiscal year (FY) 2001, FY 
2002, and FY 2003 as follows:


                        [In millions of dollars]
------------------------------------------------------------------------
         Area of consideration            FY 2001    FY 2002    FY 2003
------------------------------------------------------------------------
Office of Under Secretary for                8.716      8.977      9.246
 Technology............................
Teacher Science and Technology               0.750      0.773      0.796
 Enhancement Institute.................
Experimental Program to Stimulate            3.000      3.000      3.000
 Competitive Technologies Program......
Scientific and Technical Research and      337.508    356.071    375.655
 Services..............................
Industrial Technology Services.........    271.015    275.421    264.960
Construction and Maintenance...........     35.879     36.955     38.064
                                        --------------------------------
      Total............................    656.868    681.197    691.721
------------------------------------------------------------------------

                          Background and Needs

  Under the leadership of the Under Secretary of Commerce for 
Technology, TA provides advice on technology policy, supports 
technology development programs, and disseminates technology 
information. The Under Secretary oversees the three major 
components of the TA: (1) the Office of Technology Policy 
(OTP), (2) the National Institute of Standards and Technology 
(NIST), and (3) the National Technical Information Service 
(NTIS). The mission of OTP is to evaluate, develop, and promote 
policies and programs that facilitate private sector innovation 
and U.S. industrial competitiveness. NIST (formerly the Bureau 
of Standards) is, by far, the largest of the three TA 
activities. NIST conducts in-house research and development as 
well as standards activities in support of U.S. industry. In 
addition, through its Industrial Technology Services (ITS) 
account, NIST funds two external technology grant and 
assistance programs: the Advanced Technology Program (ATP), 
which provides grants to companies to undertake initial high 
risk high-tech research to develop promising technologies with 
economic potential (but does not support product development), 
and the Manufacturing Extension Partnership (MEP), which 
provides manufacturing assistance to small- and medium-sized 
businesses through regional centers. NIST also manages the 
Malcolm Baldridge National Quality Award, which is given to 
U.S. companies that excel in quality achievement and total 
quality management. NTIS is a self-financed agency that 
collects and sells to the public technical information 
generated by the U.S. government and foreign sources.
  In recent years, of all the TA activities, the greatest 
controversy has involved NIST's two grant programs--ATP and 
MEP. Proponents of ATP argue that the program strengthens the 
U.S. economy by providing U.S. companies with a critical 
helping hand by funding peer-reviewed, high risk, yet 
promising, commercially-relevant research ventures that private 
capital sources would be unlikely to finance because of the 
risk and unlikelihood of a quick return on investment. However, 
opponents of ATP view the program as ``corporate welfare'' and 
believe that the goal of increased U.S. competitiveness is 
better achieved through a combination of deregulation, tax 
reform, tort reform, and more vigorous enforcement of trade 
agreements. MEP has been viewed by critics of NIST in a more 
favorable light. Through its centers in each state and over 300 
smaller local activities, MEP provides assistance to the 
Nation's approximately 381,000 small- and medium-sized firms 
seeking to modernize their plants. Proponents assert that this 
is precisely the kind of assistance that these firms need 
because it is difficult for owners and managers of small 
companies to find high-quality, unbiased information, advice, 
and assistance. In addition, many of these firms lag behind 
their foreign competitors in technology and operations, leading 
larger firms to look increasingly for offshore suppliers. 
However, some believe that the MEP concept of using extension 
agents to visit industries to identify and to address their 
needs is not a cost-effective model and is particularly 
inefficient in rural states where the agents must travel great 
distances. Opponents also argue that the MEP makes insufficient 
use of advanced computer networking to deliver needed technical 
assistance to U.S. companies.

                          Legislative History

  On February 7, 2000, the Administration submitted its FY 2001 
budget request for TA to the Congress. On April 21, 1999, the 
Subcommittee on Science, Technology, and Space held an 
oversight hearing on TA's programs at which time testimony was 
heard from Gary Bachula, Acting Under Secretary of Commerce for 
Technology and Raymond Kammer, Director, NIST.
  On July 21, 1999, Senator Frist, Chairman of the 
Subcommittee, introduced S. 1407, a bill to authorize 
appropriations for TA for FY 2000, FY 2001, and FY 2002.
  On April 13, 2000, the Committee met in executive session 
and, on a voice vote, ordered the bill, as amended, to be 
reported.

                      Summary of Major Provisions

  As reported, S. 1407 would authorize funding for TA for FY 
2001, FY 2002, and FY 2003 and make several changes to the 
programs of TA. Major provisions of S. 1407, as reported, 
include:
  1. Authorization of Appropriations. A total of $656.9 million 
would be authorized for the TA for fiscal year (FY) 2001, 
$681.2 million for FY 2002, and $691.7 million for FY 2003. The 
authorized funding level for TA is allocated among its 
activities as indicated in the chart under Purpose of the Bill.
  2. National Institute of Standards and Technology Act 
Amendments. Substantial changes would be made to the manner in 
which ATP is administered. Specifically, the participation of 
large companies would be restricted to joint ventures or 
partnerships only, and all competitions would be required to be 
general and open to all applicants.
  3. Experimental Program to Stimulate Competitive 
Technologies. The Experimental Program to Stimulate Competitive 
Technologies would be transferred from OTP to NIST with an 
annual authorization level of $3 million.

                            Estimated Costs

  In accordance with paragraph 11(a) of rule XXVI of the 
Standing Rules of the Senate and section 403 of the 
Congressional Budget Act of 1974, the Committee provides the 
following cost estimate, prepared by the Congressional Budget 
Office:

                                     U.S. Congress,
                               Congressional Budget Office,
                                       Washington, DC, May 1, 2000.
Hon. John McCain,
Chairman, Committee on Commerce, Science, and Transportation, U.S. 
        Senate, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for S. 1407, the Technology 
Administration Authorization Act for Fiscal Years 2001, 2002, 
and 2003.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are Mark Hadley 
(for federal costs) and Shelley Finalyson (for the state and 
local impact).
            Sincerely,
                                          Barry B. Anderson
                                    (For Dan L. Crippen, Director).
    Enclosure.

S. 1407--Technology Administration Authorization Act for Fiscal Years 
        2001, 2002, and 2003

    Summary: S. 1407 would authorize appropriations for fiscal 
years 2001 through 2003 for various technology programs 
administered by the Department of Commerce. Funds would be 
authorized for the National Institute of Standards and 
Technology (NIST), for the office of the Under Secretary for 
Technology, and for the Experimental Program to Stimulate 
Competitive Technologies (EPSCOT). The bill would authorize 
several new initiatives at NIST, including a science and 
technology training program for teachers, and an interagency 
board concerned with global positioning systems. Other 
provisions of the bill would modify existing programs, and 
would authorize NIST to transfer title to tangible personal 
property to recipients of funding from the Advanced Technology 
Program (ATP) under certain conditions. The bill also would 
require NIST and office of the Under Secretary to submit 
reports to the Congress on the status of the manufacturing 
sector in the digital age and the activities of the national 
laboratories.
    Assuming appropriation of the authorized amounts, CBO 
estimates that implementing S. 1407 would cost about $2 billion 
over the 2001-2005 period. Provisions regarding the transfer of 
title to personal property could affect direct spending; 
therefore, pay-as-you-go procedures would apply to the bill. 
CBO estimates, however, that the impact on direct spending 
would not be significant in any one year.
    S. 1407 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA) 
and could benefit state and local governments.
    Estimated cost to the Federal Government: The estimated 
budgetary impact of S. 1407 is shown in the following table. 
The costs of this legislation fall within budget function 370 
(commerce and housing credit). For the purposes of this 
estimate, CBO assumes that all authorized amounts will be 
appropriated near the beginning of each fiscal year and that 
outlays will follow the historical spending patterns for the 
affected programs.

----------------------------------------------------------------------------------------------------------------
                                                                      By fiscal year, in millions of dollars
                                                                 -----------------------------------------------
                                                                   2000    2001    2002    2003    2004    2005
----------------------------------------------------------------------------------------------------------------
                                      SPENDING SUBJECT TO APPROPRIATION \1\
Spending Under Current Law:
    Budget Authority \2\........................................     642       0       0       0       0       0
    Estimated Outlays...........................................     648     420     210      76      33      11
Proposed Changes:
    Authorization Level.........................................       0     657     677     692       0       0
    Estimated Outlays...........................................       0     316     524     633     328     145
Spending Under S. 1407:
    Authorization Level \2\.....................................     642     657     677     692       0       0
    Estimated Outlays...........................................     648     736     734     709     361     156
----------------------------------------------------------------------------------------------------------------
\1\ This bill could affect direct spending if NIST chose to transfer title to some of the personal property
  acquired under ATP that otherwise would have been sold as surplus property under current law. Based on
  information provided by NIST, however, CBO estimates that the potential loss in sale receipts would not be
  significant in any one year.
\2\ The 2000 level is the amount appropriated for that year for specified technology programs with the
  Department of Commerce.

    Pay-as-you-go considerations: The Balanced Budget and 
Emergency Deficit Control Act sets up pay-as-you-go procedures 
for legislation affecting direct spending and receipts. 
Provisions in S. 1407 authorizing NIST to convey title to 
personal property could reduce offsetting receipts (a form of 
direct spending), but CBO estimates that any loss of receipts 
would not be significant in any single year.
    Estimated impact on state, local, and tribal governments: 
S. 1407 contains no intergovernmental mandates as defined in 
UMRA, but several sections of the bill would affect grant 
programs that benefit state and local governments. The bill 
would authorize appropriations totaling about $352 million for 
the 2001-2003 period for the Manufacturing Extension 
Partnership (MEP), a program jointly financed by the federal 
government and state or local agencies. The MEP is a program 
designed to enhance productivity and technological performance 
in the United States and is made up of the State Technology 
Extension Program (STEP) and the Manufacturing Extension 
Centers Program (MECP). STEP provides technical assistance and 
planning grants to states to develop or revitalize their 
technology program. MECP involves cooperative agreements 
between the federal government and nonprofit institutions that 
are often funded by state or local development agencies or 
universities.
    S. 1407 also would authorize appropriations for the 
Experimental Program to Stimulate Competitive Technology. This 
is a program to strengthen the technological competitiveness of 
states that have historically received less federal research 
and development funds than other states. These grants require 
at least a 25-percent match and are available to consortia 
including state and local governments. The bill would transfer 
the program from the Under Secretary of Commerce to NIST and 
authorize appropriations of $3 million annually for fiscal 
years 2001 through 2003. Any costs to state or local 
governments to participate in these technology programs would 
be voluntary.
    Estimated impact on the private sector: This bill would 
impose no new private-sector mandates as defined in UMRA.
    Estimated prepared by: Federal Costs: Mark Hadley. Impact 
on State, Local, and Tribal Governments: Shelley Finlayson. 
Impact on the Private Sector: Jean Wooster.
    Estimate approved by: Peter H. Fontaine, Deputy Assistant 
Director for Budget Analysis.

                      Regulatory Impact Statement

  In accordance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee provides the 
following evaluation of the regulatory impact of the 
legislation, as reported:

                       number of persons covered

  S. 1407, as reported, would reauthorize appropriations for 
DOC's TA for fiscal years 2001, 2002, and 2003. The TA conducts 
measurements and standards activities in support of U.S. 
industry and manages technology grant and assistance programs 
to increase U.S. competitiveness. The Committee believes that 
the bill will not subject any individuals or businesses 
affected by the bill to any additional regulation.

                            economic impact

  Providing for continual funding would allow NIST to continue 
its support of U.S. industries by conducting its standards and 
measurements setting functions. NIST's grants and assistance 
programs would continue to assist U.S. businesses to be more 
competitive in international markets and would continue to 
benefit the general public through contributing to the economic 
growth of the country from investments in new science and 
technology ventures that otherwise would not have been 
undertaken.

                                privacy

  This legislation would not have an adverse impact on the 
privacy of individuals.

                               paperwork

  This legislation would not increase the paperwork requirement 
for private individuals or businesses. The legislation would 
require three reports to be submitted to the Senate Committee 
on Commerce, Science, and Transportation and the House 
Committee on Science: (1) the Director of NIST would be 
required to submit a report on the manufacturing sector; (2) 
the Assistant Secretary for Technology Policy would be required 
to submit a report on the national laboratories; and (3) the 
Director of NIST would be required to submit a report on 
technical standards.

                      Section-by-Section Analysis


Section 1. Short title

  This section would permit the reported bill to be cited as 
the ``Technology Administration Authorization Act for Fiscal 
Years 2001, 2002, and 2003.''

Section 2. Definitions

  This section would provide the definitions of several key 
terms used throughout the report bill.

Section 3. Authorization of appropriations for scientific and technical 
        research and development

  Subsection (a) would authorize $338 million for Scientific 
and Technical Research Services for FY 2001, $356 million for 
FY 2002, and $376 million for FY 2002.
  The Committee continues to recognize NIST's important and 
legitimate role in promoting U.S. industrial competitiveness by 
working with industry to develop and apply measurements, 
standards, and technology. The basic research and standards 
work at NIST is an important function.
  The Committee continues to recognize the role of quality as 
an integral part of today's business management practices. The 
Committee commends NIST for its work in establishing the 
Malcolm Baldridge Quality Award criteria, which is used by 
thousands of organizations as a general performance and 
business excellence model.
  As standards develop that allow interoperability, 
manufacturers and retailers can more closely integrate their 
supply chains. A March 1999 NIST study estimates that lack of 
interoperability costs the automotive supply chain $1 billion 
per year. The majority of these costs are attributable to the 
time and resources spent correcting and reformatting data files 
that are not usable by those receiving the files. While a 
general international Standard for the Exchange of Product 
Model Data (STEP) exists to facilitate the exchange of these 
data files, much more work needs to be done to apply that 
standard to specific industries. This section of the reported 
bill includes $4 million for FY 2001 for NIST to continue 
cooperation with the automotive and aerospace industries into 
the pilot stage and with other key manufacturing sectors on 
implementing STEP.
  The funds authorized in this section of the reported bill 
also would include NIST's Minority Serving Initiative. This 
important new initiative would allow NIST to foster 
partnerships with these institutions which educate a 
disproportionately large number of the nation's minority 
scientists and engineers. It would also expand the post-
doctoral fellowship program, bringing more of these scientists 
and engineers to work at NIST.
  In Subsection (b), NIST would be authorized $36 million for 
FY 2001, $37 million for FY 2002, and $38 million for FY 2003 
for the Construction and Maintenance account in order to fund 
needed new construction and renovations at NIST.
  In Subsection (c), NIST would be provided $750,000 for FY 
2001, $773,000 for FY 2002, and $796,000 for FY 2003 for the 
Teacher Science and Technology Enhancement Institute program. 
The Committee is disappointed that the President's request did 
not include funding for this program, which was established by 
the Technology Administration Act of 1998. The Committee 
believes that this program will greatly assist teachers in 
better understanding the relationship between technology and 
commerce. The need for human capital has been identified as a 
major barrier to continual growth by the technology community, 
more so than technology and finance.To ensure that American 
industry continues to be the dominant player in the global economy, 
NIST must do its part to ensure a readily available source of human 
capital exists.

Section 4. Authorization for the Office of the Under Secretary for 
        Technology

  Subsection (a) would authorize $8,716,000 for FY 2001, 
$8,977,000 for FY 2002, and $9,246,000 for FY 2003 for the 
activities of the Under Secretary for Technology and OTP.
  Subsection (b) would authorize $590,000 for FY 2001, $608,000 
for FY 2002, and $626,000 for FY 2003 of the funds in 
Subsection (a) for the Office of Space Commercialization.
  The Committee has steadfastly supported the Federal 
investment in research and development. The products of that 
investment, scientific and technical documents, are archived 
and disseminated by NTIS. The Committee has not endorsed the 
closure of NTIS, as proposed by the Secretary of Commerce. The 
proposal submitted to the Committee by the Secretary is 
incomplete and does not address several issues that were raised 
during a hearing held by the Committee on October 21, 1999. The 
Committee intends to review the status of the agency further 
before making a final decision.

Section 5. Authorization of appropriation for industrial technology 
        services

  This section would authorize $271.02 million for ITS for FY 
2001, $275.42 million for FY 2002, and $264.96 for FY 2003. The 
ITS account funds NIST's ATP and MEP. There would be authorized 
to be appropriated for ATP $146.88 million for FY 2001, $151.28 
million for FY 2002, and $155.82 million for FY 2003. There 
would be authorized to be appropriated for the MEP program 
$124.14 million for FY 2001, $119.14 million for FY 2002, and 
$109.14 million for FY 2003.
  The MEP FY 2001 funding level is $10 million above the 
requested level and would allow accelerated implementation of 
the e-commerce initiative for support of small manufacturing 
firms. This $10 million would increase support for the small 
manufacturers by more than 100 percent above the requested 
level for a total of $19 million for FY 2001. The reported bill 
provides a total of $15 million for FY 2002 and $5 million for 
FY 2003 for this e-commerce initiative. The Committee believes 
that accelerated funding over the next two years is very 
important and necessary to ensure that the small manufacturers 
remain competitive.
  The FY 2001 funding level of $147 million for ATP is a 3 
percent increase above the FY 2000 appropriated level. The 
funding level for FY 2001 and FY 2002 also represents a 3 
percent increase over the previous year. The Committee 
continues to be concerned about ATP's failure to use $26 
million in funds for new awards in FY 1999 and the program's 
decision to de-obligate $28 million previously dedicated to 
projects in FY 1999.
  The Committee recognizes that a major element of the Nation's 
transition to electronic commerce is the need to improve 
manufacturing productivity by ensuring that electronic data can 
be exchanged accurately and efficiently. Over the past two 
years, representatives from several government agencies 
(Departments of Energy, Defense, and Commerce and the National 
Science Foundation) and many companies in the manufacturing 
sector worked to develop roadmaps that address generic future 
manufacturing infrastructure requirements. The resulting 
documents, the Integrated Manufacturing Technology Roadmaps, 
laid out common visions in the areas of information systems for 
manufacturing enterprises, modeling and simulation, 
manufacturing processes and equipment, and technologies for 
enterprise integration. Integrated Manufacturing Technology 
Initiative is the name given to the implementation of these 
roadmaps. The Committee supports the budget request of $1 
million to support the federal government role in this public-
private partnership and the establishment of a convening 
organization that will use the Integrated Manufacturing 
Technology Roadmaps as its guide.

Section 6. National Institute of Standards and Technology Act 
        amendments

  Section 6 of the reported bill would make several amendments 
to the NIST Act.
  Subsection (a) would amend the NIST Act, making changes to 
the process by which ATP operates. Specifically under 
subsection (a), paragraph (1) would require the reviewers, as 
part of the current technical merit review process, to make a 
determination that the research projects in question would not 
go forward in a timely manner without Federal assistance. In 
addition, each program applicant would be required to certify 
that an unsuccessful attempt has been made to secure private 
market funding for the research project involved. In providing 
the certification, each applicant would be required to include 
a written narrative description of the efforts made to secure 
the funding. Paragraph (1) also would restrict a large 
business' participation to joint ventures only, and the joint 
ventures would have to include one or more small businesses.
  In paragraph (2), the term ``large business'' would be 
defined as a business with gross annual revenues greater than 
$2.5 billion. A small business would be defined in accordance 
with section 3(a)(1) of the Small Business Act. A medium 
business would be a business that is neither a small business 
nor a large business.
  Paragraph (3) would make a technical correction to the Act to 
redesignate subsection (j) of the existing code as subsection 
(m).
  Paragraph (4) would authorize the Director to grant an 
extension beyond the five year deadline for completing a 
project provided that the extension would result in no 
additional costs to the Federal government and is in the 
Federal government's interest. Paragraph (4) also would allow 
the Secretary to vest title to tangible personal property in 
ATP grant recipients as long as (a) the property is purchased 
as part of the ATP grant, and (b) the Secretary determines that 
the vesting furthers the objectives of NIST. The vesting made 
under this subsection would be made only if subject to the 
limitations prescribed by the Secretary, and only if vesting 
causes no additional cost to the Federal government.
  Subsection (b) would amend the NIST Act provisions which 
govern ATP to allow non-industry joint venture participants 
such as universities and non-profits participating as ATP 
awardees and subawardees the option of retaining title to the 
intellectual property generated under ATP programs where the 
non-government parties to the ATP project agree it will serve 
the interests of the participants in the project. This change 
will provide a greater opportunity for industry to work 
together with universities and other nonprofit organizations. 
The amendment language removes anyrestriction requiring patent 
title to be held by nonprofit companies and permits the participants to 
agree among themselves as to where patent title will vest. The 
amendment also provides a preemption of the requirements of chapter 18 
of title 35 of the U.S. Code as required by that chapter. It furthers 
stipulates that these provisions are not retroactive. Subsection (b) of 
the reported bill would eliminate all focus program competitions. 
Specifically, this subsection would require all awards to be based on 
general open competitions.

Section 7. Reports

  Subsection (a) would require the Director, within six months 
after enactment, to submit a report to the Senate Committee on 
Commerce, Science, and Transportation and the House of 
Representatives Committee on Science on the manufacturing 
sector addressing such issues as an expanded definition of and 
the role of manufacturing in the digital age; necessary 
revisions to existing federal programs to reflect requirements 
imposed by the knowledge-based economy; and needs of small 
businesses for technical assistance.
  Subsection (b) would require the Assistant Secretary for 
Technology Policy, within nine months after enactment, to 
submit a report to the Senate Committee on Commerce, Science, 
and Transportation and the House of Representatives Committee 
on Science on whether the laboratories have clearly defined and 
focused missions; barriers to maintaining competitive centers 
of excellence; laboratory collaborations; strengthening 
laboratories; and any recommendations to increase the 
efficiency and effectiveness of the national laboratories.
  Subsection (c) would require the Director, in consultation 
with the U.S. Trade Representative Office and other appropriate 
agencies, to submit a report to the Senate Committee on 
Commerce, Science, and Transportation and the House of 
Representatives Committee on Science, within six months of 
enactment, on the role and impact of international technical 
standards on global commerce and international trade; the role 
of national standards in international commerce and trade 
policies; the timeliness of domestic and international process 
and its impact on development of new markets and new 
technologies; market, industry, and technology inputs to the 
standards process; access in representation to the domestic and 
international standards process; and any recommendation for 
changes to the domestic standards process.

Section 8. Authorization of interagency support for global positioning 
        system

  This section would authorize interagency funds and other 
forms of support for the activities of the Interagency Global 
Positioning System Executive Board (IGEB) including the 
Executive Secretariat, which is housed within the Department of 
Commerce. This section does not authorize any additional funds 
to any agency but does exempt the IGEB from the general 
legislative ban on multi-agency funding of executive boards.
  Due to the dual military and civilian nature of the Global 
Positioning System (GPS), the Committee supports the 
involvement of civilian agencies in the management of the GPS. 
Furthermore, because of the jointly held responsibilities of 
the IGEB, which is co-chaired by the Departments of Defense and 
Transportation and includes the Departments of Commerce, State, 
Agriculture, Justice, and Interior as well as the Joint Chiefs 
of Staff and the National Aeronautics and Space Administration, 
the Committee supports allowing multi-agency contributions to 
fund the activities of the IGEB, including the operations of 
the Executive Secretariat.

Section 9. Transfer of EPSCoT to NIST

  Subsection (a) would transfer the Experimental Program to 
Stimulate Competitive Technology (EPSCoT) from OTP to NIST. The 
Committee is disappointed that the Administration did not 
include funding for the program as part of the FY 2001 budget 
request.
  Subsection (b) would authorize $3 million for FY 2001, $3 
million for FY 2002, and $3 million for FY 2003 for EPSCoT.
  Consistent with the Technology Administration Act of 1998, 
the Committee encourages the Director to ensure that states are 
working toward established achievement criteria for 
participating in the program. It is hoped that as more states 
meet this criteria, their need to participate in the program 
may be eliminated.

                        Changes in Existing Law

  In compliance with paragraph 12 of rule XXVI of the Standing 
Rules of the Senate, changes in existing law made by the bill, 
as reported, are shown as follows (existing law proposed to be 
omitted is enclosed in black brackets, new material is printed 
in italic, existing law in which no change is proposed is shown 
in roman):

           NATIONAL INSTITUTE OF STANDARDS AND TECHNOLOGY ACT


SEC. 28. ADVANCED TECHNOLOGY PROGRAM. [15 U.S.C. 278N]

  (a) There is established in the Institute an Advanced 
Technology Program (hereafter in this Act referred to as the 
``Program'') for the purpose of assisting United States 
businesses in creating and applying the generic technology and 
research results necessary to--
          (1) commercialize significant new scientific 
        discoveries and technologies rapidly; and
          (2) refine manufacturing technologies.
  The Secretary, acting through the Director, shall assure that 
the Program focuses on improving the competitive position of 
the United States and its businesses, gives preference to 
discoveries and to technologies that have great economic 
potential, and avoids providing undue advantage to specific 
companies. In operating the Program, the Secretary and Director 
shall, as appropriate, be guided by the findings and 
recommendations of the Biennial National Critical Technology 
Reports prepared pursuant to section 603 of the National 
Science and Technology Policy, Organization, and Priorities Act 
of 1976 (42 U.S.C. 6683).
  (b) Under the Program established in subsection (a), and 
consistent with the mission and policies of the Institute, the 
Secretary, acting through the Director, and subject to 
subsections (c) and (d), may--
          (1) aid industry-led United States joint research and 
        development ventures (hereafter in this section 
        referred to as ``joint ventures'' (which may also 
        include universities and independent research 
        organizations), including those involving collaborative 
        technology demonstration projects which develop and 
        test prototype equipment and processes, through--
                  (A) provision of organizational and technical 
                advice; and
                  (B) participation in such joint ventures by 
                means of grants, cooperative agreements, or 
                contracts, if the Secretary, acting through the 
                Director, determines participation to be 
                appropriate, which may include (i) partial 
                start-up funding, (ii) provision of a minority 
                share of the cost of such joint ventures for up 
                to 5 years, and (iii) making available 
                equipment, facilities, and personnel, provided 
                that emphasis is placed on areas where the 
                Institute has scientific or technological 
                expertise, on solving generic problems of 
                specific industries, and on making those 
                industries more competitive in world markets;
          (2) provide grants to and enter into contracts and 
        cooperative agreements with United States businesses 
        (especially small businesses), provided that emphasis 
        is placed on applying the Institute's research, 
        research techniques, and expertise to those 
        organizations' research programs;
          (3) involve the Federal laboratories in the Program, 
        where appropriate, using among other authorities the 
        cooperative research and development agreements 
        provided for under section 12 of the Stevenson-Wydler 
        Technology Innovation Act of 1980; and
          (4) carry out, in a manner consistent with the 
        provisions of this section, such other cooperative 
        research activities with joint ventures as may be 
        authorized by law or assigned to the Program by the 
        Secretary.
  (c) The Secretary, acting through the Director, is authorized 
to take all actions necessary and appropriate to establish and 
operate the Program, including--
          (1) publishing in the Federal Register draft criteria 
        and, no later than six months after the date of the 
        enactment of this section, following a public comment 
        period, final criteria, for the selection of recipients 
        of assistance under subsection (b)(1) and (2);
          (2) monitoring how technologies developed in its 
        research program are used, and reporting annually to 
        the Congress on the extent of any overseas transfer of 
        these technologies;
          (3) establishing procedures regarding financial 
        reporting and auditing to ensure that contracts and 
        awards are used for the purposes specified in this 
        section, are in accordance with sound accounting 
        practices, and are not funding existing or planned 
        research programs that would be conducted in the same 
        time period in the absence of financial assistance 
        under the Program;
          (4) assuring that the advice of the Committee 
        established under section 10 is considered routinely in 
        carrying out the responsibilities of the Institute; and
          (5) providing for appropriate dissemination of 
        Program research results.
  (d) When entering into contracts or making awards under 
subsection (b), the following shall apply:
          (1)(A) No contract or award may be made until the 
        research project in question has been subject to a 
        merit review, and has, in the opinion of the reviewers 
        appointed by the Director and the Secretary, acting 
        through the Director, been shown to have scientific and 
        technical merit and be of a nature and scope that would 
        not be pursued in a timely manner without Federal 
        assistance.
          (B) Each applicant for a contract or award under the 
        Program shall certify that the applicant has made an 
        effort to secure private market funding for the 
        research project involved. That certification shall 
        include a written narrative description of the efforts 
        made by the applicant to secure that funding.
          (2) In the case of joint ventures, the Program shall 
        not make an award unless the award will facilitate the 
        formation of a joint venture or the initiation of a new 
        research and development project by an existing joint 
        venture.
          (3) No Federal contract or cooperative agreement 
        under subsection (b)(2) shall exceed $2,000,000 over 3 
        years, or be for more than 3 years unless a full and 
        complete explanation of such proposed award, including 
        reasons for exceeding these limits, is submitted in 
        writing by the Secretary to the Committee on Commerce, 
        Science, and Transportation of the Senate and the 
        Committee on Science, Space, and Technology of the 
        House of Representatives. The proposed contract or 
        cooperative agreement may be executed only after 30 
        calendar days on which both Houses of Congress are in 
        session have elapsed since such submission. Federal 
        funds made available under subsection (b)(2) shall be 
        used only for direct costs and not for indirect costs, 
        profits, or management fees of the contractor.
          (4) In determining whether to make an award to a 
        particular joint venture, the Program shall consider 
        whether the members of the joint venture have made 
        provisions for the appropriate participation of small 
        United States businesses in such joint venture.
          (5) Section 552 of title 5, United States Code, shall 
        not apply to the following information obtained by the 
        Federal Government on a confidential basis in 
        connection with the activities of any business or any 
        joint venture receiving funding under the Program--
                  (A) information on the business operation of 
                any member of the business or joint venture; 
                and
                  (B) trade secrets possessed by any business 
                or any member of the joint venture.
          (6) Intellectual property owned and developed by any 
        business or joint venture receiving funding or by any 
        member of such a joint venture may not be disclosed by 
        any officer or employee of the Federal Government 
        except in accordance with a written agreement between 
        the owner or developer and the Program.
          (7) If a business or joint venture fails before the 
        completion of the period for which a contract or award 
        has been made,after all allowable costs have been paid 
and appropriate audits conducted, the unspent balance of the Federal 
funds shall be returned by the recipient to the Program.
          (8) Upon dissolution of any joint venture or at the 
        time otherwise agreed upon, the Federal Government 
        shall be entitled to a share of the residual assets of 
        the joint venture proportional to the Federal share of 
        the costs of the joint venture as determined by 
        independent audit.
          (9) A company shall be eligible to receive financial 
        assistance under this section only if--
                  (A) the Secretary finds that the company's 
                participation in the Program would be in the 
                economic interest of the United States, as 
                evidenced by investments in the United States 
                in research, development, and manufacturing 
                (including, for example, the manufacture of 
                major components or subassemblies in the United 
                States); significant contributions to 
                employment in the United States; and agreement 
                with respect to any technology arising from 
                assistance provided under this section to 
                promote the manufacture within the United 
                States of products resulting from that 
                technology (taking into account the goals of 
                promoting the competitiveness of United States 
                industry), and to procure parts and materials 
                from competitive suppliers; and
                  (B) either--
                          (i) the company is a United States-
                        owned company; or
                          (ii) the Secretary finds that the 
                        company is incorporated in the United 
                        States and has a parent company which 
                        is incorporated in a country which 
                        affords to United States-owned 
                        companies opportunities, comparable to 
                        those afforded to any other company, to 
                        participate in any joint venture 
                        similar to those authorized under this 
                        Act affords to United States-owned 
                        companies local investment 
                        opportunities comparable to those 
                        afforded to any other company; and 
                        affords adequate and effective 
                        protection for the intellectual 
                        property rights of United States-owned 
                        companies.
          (10) Grants, contracts, and cooperative assignments 
        under this section shall be designed to support 
        projects which are high risk and which have the 
        potential for eventual substantial widespread 
        commercial application. In order to receive a grant, 
        contract, or cooperative agreement under this section, 
        a research and development entity shall demonstrate to 
        the Secretary the requisite ability in research and 
        technology development and management in the project 
        area in which the grant, contract, or cooperative 
        agreement is being sought.
          (11)(A) Title to any intellectual property arising 
        from assistance provided under this section shall vest 
        in a company or companies incorporated in the United 
        [States.] States or any other university or nonprofit 
        awardee or subawardee (as those terms are defined by 
        the Secretary) receiving financial assistance under 
        this section, as agreed by the parties, notwithstanding 
        the requirements of chapter 18 of title 35, United 
        States Code. The United States may reserve a 
        nonexclusive, nontransferable, irrevocable paid-up 
        license, to have practiced for or on behalf of the 
        United States, in connection with any such intellectual 
        property, but shall not, in the exercise of such 
        license, publicly disclose proprietary information 
        related to the license. Title to any such intellectual 
        property shall not be transferred or passed, except to 
        a company incorporated in the United States, until the 
        expiration of the first patent obtained in connection 
        with such intellectual property.
          (B) For purposes of this paragraph, the term 
        ``intellectual property'' means an invention patentable 
        under title 35, United States Code, or any patent on 
        such an invention.
          (C) Nothing in this paragraph shall be construed to 
        prohibit the licensing to any company of intellectual 
        property rights arising from assistance provided under 
        this section.
          (12) A large business may participate in a research 
        project that is the subject of a contract or award 
        under paragraph (3) only as a member of a joint venture 
        that includes 1 or more small businesses as members.
  (e) The Secretary may, within 30 days after notice to 
Congress, suspend a company or joint venture from continued 
assistance under this section if the Secretary determines that 
the company, the country of incorporation of the company or a 
parent company, or the joint venture has failed to satisfy any 
of the criteria set forth in subsection (d)(9), and that it is 
in the national interest of the United States to do so.
  (f) When reviewing private sector requests for awards under 
the Program, and when monitoring the progress of assisted 
research projects, the Secretary and the Director shall, as 
appropriate, coordinate with the Secretary of Defense and other 
senior Federal officials to ensure cooperation and coordination 
in Federal technology programs and to avoid unnecessary 
duplication of effort. The Secretary and the Director are 
authorized to work with the Director of the Office of Science 
and Technology Policy, the Secretary of Defense, and other 
appropriate Federal officials to form interagency working 
groups or special project offices to coordinate Federal 
technology activities.
  (g) In order to analyze the need for the value of joint 
ventures and other research projects in specific technical 
fields, to evaluate any proposal made by a joint venture or 
company requesting the Secretary's assistance, or to monitor 
the progress of any joint venture or any company research 
project which receives Federal funds under the Program, the 
Secretary, the Under Secretary of Commerce for Technology, and 
the Director may, notwithstanding any other provision of law, 
meet with such industry sources as they consider useful and 
appropriate.
  (h) Up to 10 percent of the funds appropriated for carrying 
out this section may be used for standards development and 
technical activities by the Institute in support of the 
purposes of this section.
  (i) In addition to such sums as may be authorized and 
appropriated to the Secretary and Director to operate the 
Program, the Secretary and Director also may accept funds from 
other Federal departments and agencies for the purpose of 
providing Federal funds to support awards under the Program. 
Any Program awardwhich is supported with funds which originally 
came from other Federal departments and agencies shall be selected and 
carried out according to the provisions of this section.
  (j) Notwithstanding subsection (b)(1)(B) and subsection 
(d)(3), the Director may grant an extension beyond the 
applicable deadline specified in subsection (b)(1)(B) or (d)(3) 
for a joint venture or single applicant recipient of assistance 
to expend Federal funds to complete the project assisted with 
that assistance, if that extension--
          (1) is granted with no additional cost to the Federal 
        Government; and
          (2) is in the interest of the Federal Government.
  (k)(1) The Secretary, acting through the Director, may vest 
title to tangible personal property in any recipient of 
financial assistance under this section if--
          (A) the property is purchased with funds provided 
        under this section; and
          (B) the Secretary, acting through the Director, 
        determines that the vesting of such property furthers 
        the objectives of the Institute.
  (2) Vesting under this subsection shall--
          (A) be subject to such limitations as are prescribed 
        by the Secretary, acting through the Director; and
          (B) be made without further obligation to the United 
        States Government.
In carrying out this section, the Secretary, acting through the 
Director, shall ensure that the requirements of Circular No. A-
110 issued by the Office of Management and Budget are met with 
respect to the valuation of cost-share items used by 
participants in the Program.
  (l) Awards Based on Competition.--All amounts appropriated 
for grants under subsection (b) for fiscal years beginning 
after the date of enactment of the Technology Administration 
Authorization Act for Fiscal Years 2000, 2001, and 2002 shall 
be used for grants awarded on the basis of general open 
competition.
  [(j)] (m) As used in this section--
          (1) the term ``joint venture'' means any group of 
        activities, including attempting to make, making, or 
        performing a contract, by two or more persons for the 
        purpose of--
                  (A) theoretical analysis, experimentation, or 
                systematic study of phenomena or observable 
                facts;
                  (B) the development or testing of basic 
                engineering techniques;
                  (C) the extension of investigative finding or 
                theory of a scientific or technical nature into 
                practical application for experimental and 
                demonstration purposes, including the 
                experimental production and testing of models, 
                prototypes, equipment, materials, and 
                processes;
                  (D) the collection, exchange, and analysis of 
                research information;
                  (E) the production of any product, process, 
                or service; or
                  (F) any combination of the purposes specified 
                in subparagraphs (A), (B), (C), (D), and (E), 
                and may include the establishment and operation 
                of facilities for the conducting of research, 
                the conducting of such venture on a protected 
                and proprietary basis, and the prosecuting of 
                applications for patents and the granting of 
                licenses for the results of such venture; [and]
          (2) the term ``large business'' means a business 
        that--
                  (A) is not a small business; and
                  (B) has gross annual revenues in an amount 
                greater than $2,500,000,000;
          (3) the term ``medium business'' means a business 
        that--
                  (A) is not a small business; and
                  (B) has gross annual revenues in an amount 
                less than or equal to $2,500,000,000;
          (4) the term ``small business'' means a small 
        business concern, as described in section 3(a)(1) of 
        the Small Business Act (15 U.S.C. 632(a)(1)); and
          [(2)] (5) the term ``United States-owned company'' 
        means a company that has majority ownership or control 
        by individuals who are citizens of the United States.

           STEVENSON-WYDLER TECHNOLOGY INNOVATION ACT OF 1980

SEC. 5. COMMERCE AND TECHNOLOGICAL INNOVATION. [15 U.S.C. 3704]

  (a) Establishment.--There is established in the Department of 
Commerce a Technology Administration, which shall operate in 
accordance with the provisions, findings, and purposes of this 
Act. The Technology Administration shall include--
          (1) the National Institute of Standards and 
        Technology;
          (2) the National Technical Information Service; and
          (3) a policy analysis office, which shall be known as 
        the Office of Technology Policy.
  (b) Under Secretary and Assistant Secretary.--The President 
shall appoint, by and with the advice and consent of the 
Senate, to the extent provided for in appropriations Acts--
          (1) an Under Secretary of Commerce for Technology, 
        who shall be compensated at the rate provided for level 
        III of the Executive Schedule in section 5314 of title 
        5, United States Code; and
          (2) an Assistant Secretary of Commerce for Technology 
        Policy, who shall serve as policy analyst for the Under 
        Secretary.
  (c) Duties.--The Secretary, through the Under Secretary, as 
appropriate, shall--
          (1) manage the Technology Administration and 
        supervise its agencies, programs, and activities;
          (2) conduct technology policy analyses to improve 
        United States industrial productivity, technology, and 
        innovation, and cooperate with United States industry 
        in the improvement of its productivity, technology, and 
        ability to compete successfully in world markets;
          (3) carry out any functions formerly assigned to the 
        Office of Productivity, Technology, and Innovation;
          (4) assist in the implementation of the Metric 
        Conversion Act of 1975;
          (5) determine the relationships of technological 
        developments and international technology transfers to 
        the output, employment, productivity, and world trade 
        performance of United States and foreign industrial 
        sectors;
          (6) determine the influence of economic, labor and 
        other conditions, industrial structure and management, 
        and government policies on technological developments 
        in particular industrial sectors worldwide;
          (7) identify technological needs, problems, and 
        opportunities within and across industrial sectors 
        that, if addressed, could make a significant 
        contribution to the economy of the United States;
          (8) assess whether the capital, technical and other 
        resources being allocated to domestic industrial 
        sectors which are likely to generate new technologies 
        are adequate to meet private and social demands for 
        goods and services and to promote productivity and 
        economic growth;
          (9) propose and support studies and policy 
        experiments, in cooperation with other Federal 
        agencies, to determine the effectiveness of measures 
        with the potential of advancing United States 
        technological innovation;
          (10) provide that cooperative efforts to stimulate 
        industrial innovation be undertaken between the Under 
        Secretary and other officials in the Department of 
        Commerce responsible for such areas as trade and 
        economic assistance;
          (11) encourage and assist the creation of centers and 
        other joint initiatives by State of [or] local 
        governments, regional organizations, private 
        businesses, institutions of higher education, nonprofit 
        organizations, or Federal laboratories to encourage 
        technology transfer, to stimulate innovation, and to 
        promote an appropriate climate for investment in 
        technology-related industries;
          (12) propose and encourage cooperative research 
        involving appropriate Federal entities, State or local 
        governments, regional organizations, colleges or 
        universities, nonprofit organizations, or private 
        industry to promote the common use of resources, to 
        improve training programs and curricula, to stimulate 
        interest in high technology careers, and to encourage 
        the effective dissemination of technology skills within 
        the wider community;
          (13) serve as a focal point for discussions among 
        United States companies on topics of interest to 
        industry and labor, including discussions regarding 
        manufacturing and discussions regarding emerging 
        technologies;
          (14) consider government measures with the potential 
        of advancing United States technological innovation and 
        exploiting innovations of foreign origin; and
          (15) publish the results of studies and policy 
        experiments.
  (d) Japanese Technical Literature.--
          (1) In addition to the duties specified in subsection 
        (c), the Secretary and the Under Secretary shall 
        establish, and through the National Technical 
        Information Service and with the cooperation of such 
        other offices within the Department of Commerce as the 
        Secretary considers appropriate, maintain a program 
        (including an office in Japan) which shall, on a 
        continuing basis--
                  (A) monitor Japanese technical activities and 
                developments;
                  (B) consult with businesses, professional 
                societies, and libraries in the United States 
                regarding their needs for information on 
                Japanese developments in technology and 
                engineering;
                  (C) acquire and translate selected Japanese 
                technical reports and documents that may be of 
                value to agencies and departments of the 
                Federal Government, and to businesses and 
                researchers in the United States; and
                  (D) coordinate with other agencies and 
                departments of the Federal Government to 
                identify significant gaps and avoid duplication 
                in efforts by the Federal Government to 
                acquire, translate, index, and disseminate 
                Japanese technical information. Activities 
                undertaken pursuant to subparagraph (C) of this 
                paragraph shall only be performed on a cost-
                reimbursable basis. Translations referred to in 
                such subparagraph shall be performed only to 
                the extent that they are not otherwise 
                available from sources within the private 
                sector in the United States.
          (2) Beginning in 1986, the Secretary shall prepare 
        annual reports regarding important Japanese scientific 
        discoveries and technical innovations in such areas as 
        computers, semiconductors, biotechnology, and robotics 
        and manufacturing. In preparing such reports, the 
        Secretary shall consult with professional societies and 
        businesses in the United States. The Secretary may, to 
        the extent provided in advance by appropriation Acts, 
        contract with private organizations to acquire and 
        translate Japanese scientific and technical information 
        relevant to the preparation of such reports.
          (3) The Secretary also shall encourage professional 
        societies and private businesses in the United States 
        to increase their efforts to acquire, screen, 
        translate, and disseminate Japanese technical 
        literature.
          (4) In addition, the Secretary shall compile, 
        publish, and disseminate an annual directory which 
        lists--
                  (A) all programs and services in the United 
                States that collect, abstract, translate, and 
                distribute Japanese scientific and technical 
                information; and
                  (B) all translations of Japanese technical 
                documents performed by agencies and departments 
                of the Federal Government in the preceding 12 
                months that are available to the public.
          (5) The Secretary shall transmit to the Congress, 
        within 1 year after the date of enactment of the 
        Japanese Technical Literature Act of 1986, a report on 
        the activities of the Federal Government to collect, 
        abstract, translate, and distribute declassified 
        Japanese scientific and technical information.
  (e) [Omitted.]
  (f) Experimental Program to Stimulate Competitive 
Technology.--
          (1) In general.--The Secretary, [acting through the 
        Under Secretary,] acting through the National Institute 
        of Standards and Technology, shall establish for fiscal 
        year 1999 a program to be known as the Experimental 
        Program to Stimulate Competitive Technology (referred 
        to in this subsection as the ``program''). The purpose 
        of the program shall be to strengthen the technological 
        competitiveness of those States that have historically 
        received less Federal research and development funds 
        than those received by a majority of the States.
          (2) Arrangements.--In carrying out the program, the 
        Secretary, [acting through the Under Secretary,] acting 
        through the National Institute of Standards and 
        Technology, shall--
                  (A) enter into such arrangements as may be 
                necessary to provide for the coordination of 
                the program through the State committees 
                established under the Experimental Program to 
                Stimulate Competitive Research of the National 
                Science Foundation; and
                  (B) cooperate with--
                          (i) any State science and technology 
                        council established under the program 
                        under subparagraph (A); and
                          (ii) representatives of small 
                        business firms and other appropriate 
                        technology-based businesses.
          (3) Grants and cooperative agreements.--In carrying 
        out the program, the Secretary, [acting through the 
        Under Secretary,] acting through the National Institute 
        of Standards and Technology, may make grants or enter 
        into cooperative agreements to provide for--
                  (A) technology research and development;
                  (B) technology transfer from university 
                research;
                  (C) technology deployment and diffusion; and
                  (D) the strengthening of technological 
                capabilities through consortia comprised of--
                          (i) technology-based small business 
                        firms;
                          (ii) industries and emerging 
                        companies;
                          (iii) universities; and
                          (iv) State and local development 
                        agencies and entities.
          (4) Requirements for making awards.--
                  (A) In general.--In making awards under this 
                subsection, the Secretary, [acting through the 
                Under Secretary,] acting through the National 
                Institute of Standards and Technology, shall 
                ensure that the awards are awarded on a 
                competitive basis that includes a review of the 
                merits of the activities that are the subject 
                of the award.
                  (B) Matching requirement.--The non-Federal 
                share of the activities (other than planning 
                activities) carried out under an award under 
                this subsection shall be not less than 25 
                percent of the cost of those activities.
          (5) Criteria for states.--The Secretary, [acting 
        through the Under Secretary,] acting through the 
        National Institute of Standards and Technology, shall 
        establish criteria for achievement by each State that 
        participates in the program. Upon the achievement of 
        all such criteria, a State shall cease to be eligible 
        to participate in the program.
          (6) Coordination.--To the extent practicable, in 
        carrying out this subsection, the Secretary, [acting 
        through the Under Secretary,] acting through the 
        National Institute of Standards and Technology, shall 
        coordinate the program with other programs of the 
        Department of Commerce.
          (7) Report.--
                  (A) In general.--Not later than 90 days after 
                the date of the enactment of the Technology 
                Administration Act of 1998, the Under Secretary 
                shall prepare and submit a report that meets 
                the requirements of this paragraph to the 
                Secretary. Upon receipt of the report, the 
                Secretary shall transmit a copy of the report 
                to the Committee on Commerce, Science, and 
                Transportation of the Senate and the Committee 
                on Science of the House of Representatives.
                  (B) Requirements for report.--The report 
                prepared under this paragraph shall contain 
                with respect to the program--
                          (i) a description of the structure 
                        and procedures of the program;
                          (ii) a management plan for the 
                        program;
                          (iii) a description of the merit-
                        based review process to be used in the 
                        program;
                          (iv) milestones for the evaluation of 
                        activities to be assisted under the 
                        program in fiscal year 1999;
                          (v) an assessment of the eligibility 
                        of each State that participates in the 
                        Experimental Program to Stimulate 
                        Competitive Research of the National 
                        Science Foundation to participate in 
                        the program under this subsection; and
                          (vi) the evaluation criteria with 
                        respect to which the overall management 
                        and effectiveness of the program will 
                        be evaluated.

                  ADDITIONAL VIEWS OF SENATOR HOLLINGS

                      advanced technology program

  The Advanced Technology Program (ATP) is an important 
investment in American economic competitiveness. It supports 
American industry's own efforts to develop new cutting-edge, 
next-generation technologies--technologies that will create the 
new industries and jobs of the 21st century. However, the ATP 
does not fund the development of commercial products. Instead, 
it provides matching funds to both individual companies and 
joint ventures for ``pre-product'' research on these high-risk, 
potentially high-payoff technologies. These technologies 
include promising new ideas in manufacturing, advanced 
electronics, and new materials.
  Why do we need the ATP? The answer is simple: to keep America 
competitive and to create jobs. Long-term technology has become 
the key to future U.S. prosperity at precisely the time that 
global competition, downsizing, and shareholder pressures are 
forcing American companies to focus scarce research dollars on 
short-term projects. The Commerce Department estimates that 
these market pressures compel companies to spend up to 90 
percent of their research funding on projects that will pay off 
in one to five years. As a result, U.S. companies, small and 
large, have serious trouble funding long-term, next-generation 
technologies that can facilitate the building of new industries 
but will not pay for ten to fifteen years. Moreover, the U.S. 
Government, historically, has supported long-term research in 
only a few key sectors--an approach very different from our 
foreign competitors.
  The ATP's sole aim is to develop new basic technologies that 
would not be pursued soon or at all because of technical risks 
and other obstacles that discourage private-sector investment. 
The ATP does not support product development and is modeled on 
similar Federal research programs that have long helped a few 
sectors such as agriculture, the aircraft industry, and energy 
technology. The program particularly helps small technology 
companies. To date, the ATP has made 468 cost-sharing awards, 
involving 1,067 companies and research partners in 43 states.
  Although ATP competitions have been in existence for only ten 
years, already a real difference can be seen from the early 
awards that have been completed. A March 1999 study found that 
future returns from just three of the completed ATP projects--
improving automobile manufacturing processes, reducing the cost 
of blood and immune cell production, and using a new material 
for prosthesis devices--would pay for all projects funded to 
date by the ATP. Measurement and evaluation have been part of 
the ATP since its beginning. The benefits of the program are 
well-documented through individual case studies; the 
Secretary's 1997 review; the February 1998 Development, 
Commercialization, and Diffusion Study; and the March 1999 
review of the Performance of Completed Projects. What these 
analyses show time and time again is that the ATP is 
stimulating collaboration, accelerating the development of 
high-risk technologies--and paying off for the nation.
  In FY 2000, total program funding for the ATP is $201.3 
million which will support $50.7 million in new awards. The 
reported bill, on the other hand, authorizes $146.9 million in 
FY 2001 for the ATP. A total program at this level would 
drastically constrict funding for new ATP awards to 
approximately $16.4 million in FY 2001.
  New awards are the lifeblood of the program. This year's 
competition brought in 417 proposals from industry, totaling 
nearly $900 million in requested ATP funding with an industry 
cost-share of over $681 million. Only $50.7 million was 
available for new awards. These proposals include 545 
participants (not including subcontractors) from industry, 
academia and other research organizations. In addition, the ATP 
staff reviewed 271 pre-proposals prior to the competition 
deadline. Numbers this large clearly demonstrate significant 
interest on the part of industry.
  Fluctuations in funding would send a message to industry that 
the future of the ATP is once again uncertain. This will halt 
progress made in encouraging industry to identify forward-
looking, risk-sharing R&D of new enabling technologies. On-
again, off-again first-year funding availability for ATP plays 
into the hands of those who argue that the Federal government 
is an unreliable partner over the long term.
  As industry continues to focus more of its R&D on near term 
product development, there will be fewer sources of support for 
the type of fundamental and enabling technology R&D that ATP 
cost-shares. Industry is approaching the ATP to co-fund truly 
revolutionary research, ranging from tissue engineering to 
advanced learning technologies. These are new technical areas 
that are becoming increasingly important to the U.S. economy 
and the quality of life of American citizens.

                  manufacturing extension partnership

  The Manufacturing Extension Partnership (MEP) supports a 
network of locally-run centers which provide technical advice 
and consulting to small manufacturing companies in all fifty 
states and Puerto Rico. Many of these firms lag behind foreign 
competitors in technology and operations, leading larger 
American firms to look increasingly for offshore suppliers. One 
of the chief challenges facing small- and medium-sized 
manufacturers is adapting and using electronic commerce 
technologies to do business with larger firms.
  The reported bill authorizes $124.2 million in FY 2001, 
$119.2 million in 2002, and $109.2 million in FY 2003 for MEP. 
The evidence is clear, however, that these proposed funding 
levels are unrealistic in the out years. The increased funding 
in FY 2001 would allow the program to fund more field agents at 
the Centers and reach more small- and medium-sized 
manufacturers. In addition, MEP could focus on the challenge of 
electronic commerce by developing more technical capacity and 
new services to help small- and medium-sized manufacturers use 
new technology to compete and win new business. The reported 
bill assumes that one year of intense focus on electronic 
commerce will be sufficient to keep small manufacturers 
competitive. I disagree. MEP will need to continue this 
effort--with at least level funding--in order to reach more 
companies and to help them use emerging technologies.

                                
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