Mr. KERRY. Mr. President, today I ask my colleagues to join me in voting for H.R. 2392, the Small Business Innovation Research Program Reauthorization Act of 2000. The Small Business Innovation Research (SBIR) program is a great example of how government and business can work together to advance the cause of science, the diverse missions of the government, and a healthy economy. The results have been dramatic for small , high-technology companies participating in the program. Since 1983 when the program was started, some 16,000 small , high-technology firms have received more than 46,000 SBIR research awards through 1997, totaling $7.5 billion.

Technological advancement is a key element of economic growth. According to a Congressional Research Service Report, Small, High Tech Companies and Their Role in the Economy: Issues in the Reauthorization of the Small Business Innovation (SBIR) Program, "technical progress is responsible for up to one-half the growth of the U.S. economy and is one of the principal driving forces for increases in our standard of living."

Mr. President, this bill, and the accompanying managers' amendment, are the products of months and months of work between Democrats and Republicans, House and Senate, SBIR companies and SBIR advocates, the ten Federal agencies that participate in the SBIR program, and the Small Business Administration's Office of Technology and the Office of Advocacy.

I want to thank Senator Bond and Senator Levin, and the members of the House Committees on Small Business and Science, and their staffs, for their hard work on this bill. Many of us had very different concerns regarding reauthorization of the SBIR program, and I greatly appreciate everyone's willingness to find common ground where possible and compromise.

We wrestled with tough questions. How long to reauthorize the program? I wanted to make it permanent; it has a long and successful track record. In fact, in 1998, the Senate Committee on Small Business voted to do just that, but that legislation never passed the House. This year the Committee agreed to reauthorize the program for ten years, giving the agencies and innovative small businesses a good measure of security to plan SBIR projects for the longer term. However, the House Science Committee felt strongly that it should only be reauthorized for seven years. In the end, as reflected in this bill, we compromised on eight, reauthorizing the bill through September 30, 2008.

How to improve the quality and collection of data without overburdening small businesses? GAO reports have found that the SBIR program works well, but that the records are sometimes incomplete, making it harder to evaluate the program and track awards. I fully support the goal of collecting the best information possible to evaluate the program, but I don't want small businesses owners to spend more time filling out paper work than absolutely necessary for that purpose. They are capable of developing cutting-edge research and meeting national R&D needs and should spend the majority of their efforts on that. As Ranking Member of the Small Business Committee and a Senator from the state whose small, hi-tech companies win the second largest amount of SBIR awards, I heard many, many complaints and concerns about the possibility of excessive and burdensome reporting requirements. I also heard complaints that the same level of reporting is not required of universities and big business that get Federal R&D dollars. There were real fears that Congress would require SBIR award winners to continue reporting to the SBA on SBIR research for years after a contract ended and that tracking commercialization out of context would be used against the program and against individual SBIR firms. Just knowing the ratio of awards to commercialization is not an indicator of success. By its very nature, R&D has a low probability of getting a product to market in relation to the investment in research. It is the ratio of commercialization in the SBIR program compared to that of big business, universities and the private sector that may be one indicator of the program's value to the government and to the nation. For example, one study shows that small businesses have 24 times as many innovations per R&D dollar as large businesses. In the end, we agreed to collect basic, but useful, information about sales and additional investment on Phase II awards. According to the Department of Defense that currently requires similar information, it generally takes less than 15 minutes to provide the information, and companies are only required to give the information during the life of the contract.

Probably the biggest question we dealt with was how to increase the participation in the SBIR program in states, and areas of states, that receive few or no awards. Though the number of awards given to a state has been proportionate to the number of proposals submitted, according to a GAO study, one-third of the states receive 85 percent of all SBIR awards. And the states that submit the most proposals generally have the right mix of small high-tech companies, an active venture capital community, and universities that understand the benefits of technology transfer, attract academic research funds and graduate a highly qualified workforce. While Massachusetts does extremely well in this program, for years I have recognized that the SBIR awards have been concentrated in less than half the states. The problem has been how to create a solution that helps small businesses in states that don't have the necessary infrastructure without changing the program's reliance on competition. Merit is the only way to maintain the integrity of the research because the highly competitive nature of SBIR awards (only one in seven or eight Phase I proposals is awarded) is one of the main reasons the program has been so popular and successful.

This bill takes two innovative approaches to increasing nationwide participation in the program. First, it establishes a peer volunteer mentoring network, which Senator Levin and I originally introduced as S. 1435 in 1999. Modeled after SBA's successful Service Corps of Retired Executives or SCORE program, this mentoring program would reimburse experienced SBIR companies that volunteer to assist one or more newcomers to the program. They can help in a variety of ways, whether it's writing proposals, understanding the Federal procurement process or a particular agency, tapping into venture capital, or commercializing their technologies. The bill also directs the SBA to create a database with the names and profiles of successful SBIR companies interested in mentoring struggling or prospective SBIR companies. This will be used by the states to link companies to mentors based on their needs.

Second, it creates the Federal and State Technology Partnership (FAST) program. This program is a competitive matching-grant program to encourage and help states cultivate high-tech small businesses and a build a support infrastructure in the state. I feel strongly, as does Senator Levin, and am very pleased, that all states, even the ones that currently win the most SBIR awards, are eligible to compete for a FAST matching grant so that they can help develop small , hi-tech companies in areas of their states that don't have SBIR activity. For example, in Massachusetts, most of our awards are in the Boston area. But with these grants, working with one of the economic development arms of our local government, we could coordinate and foster SBIR activity in the Western part of the state close to Amherst and Northampton. Those companies could create high-quality, high-wage jobs where the cost structure for companies is less expensive but where we have numerous universities and highly-skilled workers.

Given the strength of these initiatives, I do have some concerns about mentoring getting lost in the states' FAST initiatives. For the record, I ask that the SBA, the program managers of participating SBIR agencies, and FAST entities promote this cost-effective tool. Take advantage of the substantial pool of good-will and willingness to share experiences of those who have been successful in the SBIR program. Let SBIR companies know that they will be reimbursed for relevant out-of-pocket expenses if they choose to become a volunteer mentor. It gives them another stake in this program, and will strengthen the program on many levels. And, SBA and SBIR agencies should let prospective or struggling SBIR companies know that veteran SBIR companies are out there willing to help them understand the world of SBIR and federal procurement.

Mr. President, these research and development awards not only provide dollars to small hi-tech companies that create quality jobs, but they also help agencies meet their R&D needs. As one example, an Army SBIR award played a role in the development of the B-2 Bomber. Specifically, the research led to the development of a "pilot alert" system which warns the pilot if the plane is about to produce a trail of condensation that could be detected by enemy radar. Sales to date, to both the Air Force and commercial customers, exceed $27 million. And what about NASA? As the world watched the space shuttle Discovery in 1998, the feature elements of two of the shuttle's payloads were developed with SBIR funds.

In Woburn, Massachusetts, NZ-Applied Technologies used its SBIR award to help develop photonic components for optical telecommunications applications. The company is so successful that Corning recently bought it for $150 million. Further, the company was named as one of the top 50 fastest growing companies in New England and top 500 fastest growing companies in the country.

I want to thank my colleagues for their support of the SBIR program over the years. As always, I am pleased that we can work in a bipartisan fashion.