BOSTON--(BUSINESS WIRE)--Save SBIR today made the following statement:
A House bill reauthorizing the Small Business Innovation Research Program (SBIR) is quietly making its way to the House floor with proposed changes that would deprive the Department of Defense of vital technology.
The legislation proposes detrimental changes to SBIR, a program that has been recognized by independent agencies as one of the most successful federal programs funding research and development through partnerships with small technological businesses. Of the $2.2 billion distributed annually by the SBIR Program, nearly $1.2 billion is allotted to the Department of Defense (DoD), which then awards the money to small businesses based on the proven viability of their technologies. The DoD relies on this local innovation from small businesses across the country to keep the U.S. military forces safe and the best equipped to fight terrorism and protect national security.
The Velazquez amendment, introduced by Rep. Nydia Velazquez (NY-5) to House Bill 1425, “Creating Jobs Through Small Business Innovation Act of 2011,” would change the current merit-based system by limiting the number of SBIR awards a company could receive. This would essentially punish firms for repeatedly producing the best technology and the most promising research solutions to military problems and making the SBIR program vulnerable to politically-motivated handouts. It would also significantly increase the percentage of large Venture Capital firms which could participate, negatively impacting the prospects of many small businesses competing for federal research and development projects, and giving hundreds of millions of dollars to firms already backed by large capital.
“Innovative companies in Lowell, Littleton and across the Fifth District have taken advantage of the SBIR program to deliver pioneering products to the federal government while creating outstanding jobs in Massachusetts,” said Congresswoman Niki Tsongas (D-MA). “Regrettably, a bill now moving through the House to reauthorize the SBIR program would alter the intent of the program and harm these same businesses, while limiting the technology available to agencies such as the Department of Defense. I will continue to push for an SBIR reauthorization that preserves the original intent of this vital program and enables innovative small business to continue to compete for funds.”
“Small businesses are America's economic engine, and SBIR is an unparalleled success in harnessing the proven innovative power of small, technology-based businesses to meet the nation’s 21st century technology needs,” said Congressman Edward J. Markey (D-MA). “One need only look to Massachusetts and the 7th District to see the positive impacts of the SBIR program - in Woburn where they are developing painless bedside muscle evaluations of children, and in Watertown with the development of a new, non-invasive approach to detecting cancer. SBIR pushes small business into new levels of discovery and success, and I will continue to fight for this crucial program."
“Many of the technologies, products, and research results KBSI provides its clients would not exist without the SBIR Program,” said Jason Ogle, General Counsel at Knowledge Based Systems, Inc. in College Station, Texas. “Since 1988, our firm alone has employed close to 500 people providing needed research and innovation to our government and commercial customers. Today, 80 percent of our research and technology development work is for the Department of Defense and the Department of Health and Human Services on programs made possible by the SBIR legislation. With the proposed changes to SBIR, the current pace of innovation and scope of technology available from the small business sector will deteriorate.”
The SBIR program is currently broken down into two main phases. Phase one is set up to fund proposed research and experiments. During Phase one, firms must prove that a concept is viable, not wasteful or fraudulent. Phase two is set up to award larger sums of money to those projects that have proven viability and are further along in the development stage. The proposed legislation will allow firms to arbitrarily bypass Phase one, thereby allowing many businesses without sound technology and innovation to move on to the second phase, incurring severe waste. In addition, the bill would grant reauthorization for only three years, an insufficient period of time in which to accurately evaluate changes in the program. The short timeframe undermines the program’s effectiveness as firms receiving SBIR funds must have long-term assurance in order to adequately plan, research and develop technology to meet the country’s needs.
“This program was created to provide underrepresented and underfunded small businesses with the capital they need to produce the best technology,” said Robert Weiss, Chair of the New England Innovation Alliance. “The success of this program depends on its ability to weed out those firms which do not produce viable technology early on, thus avoiding wasteful spending.”
A version of the bill excluding these changes has been championed by lawmakers including House Minority Leader Nancy Pelosi, Senator Olympia Snowe, Senator John Kerry, Senator Scott Brown, Senator Jeanne Shaheen, Senator Landrieu, Congresswoman Niki Tsongas, Congressman Edward J. Markey, and other members of the U.S. Congress.
About SBIR:
Congress established the Small Business Innovation Research (SBIR) Program in 1982 to stimulate technological innovation, utilize small business to meet federal research and development needs, and encourage participation by minority, underrepresented and disadvantaged businesses in technological innovation. SBIR has been deemed a successful program on many levels. More than 80,000 patents have been delivered by SBIR firms, which employ 1.5 million people. SBIR has led to the creation of companies and products such as Qualcomm, Symantec, iRobot and the electric toothbrush.