Letter to Chairmen of the Armed Services Committee Mckeon and Levin, and Ranking Members Smith and McCAin

Letter

Today, Representatives Niki Tsongas (D-Mass.), Edward J. Markey (D-Mass.), and Peter Welch (D-Vt.) sent a letter signed by a bipartisan group of 27 House members requesting that the conference committee appointed to iron out the differences between the House and Senate-passed versions of the Fiscal Year 2012 National Defense Authorization Act (NDAA) adopt an amendment, included in the Senate-passed version, to preserve the Small Business Innovation and Research program (SBIR).

Reps. Tsongas, Markey and Welch have been leading the effort in the House of Representatives to reauthorize this program which has a proven track record of supporting job creation in innovative industries for almost three decades. Several years' worth of short-term extensions of the SBIR program have created significant uncertainty for both the federal government and for the small businesses that create jobs. The most recent short-term extension of the SBIR program is set to expire on December 16th.

Currently, the SBIR program provides instrumental funding to "infant" industry research and development where obtaining private capital is not yet an option. It is often described as the most successful federal government R&D program, having delivered more than 55,000 patents and hundreds of valuable innovations in a wide variety of industries. Massachusetts has received the highest number of SBIR awards per capita of any state, totaling approximately $283 million in the last year alone.

The Senate-passed version of the NDAA calls for a long-term reauthorization of the SBIR program that maintains the programs original intent: fostering innovative and cutting-edge research at small businesses. This is the closest the program has come to a long-term reauthorization since 2008.

The lawmakers write, "Given the importance of the SBIR program to our Armed Forces, enactment of the reauthorization in this year's NDAA is appropriate."

The Senate-passed reauthorization has been endorsed by a wide range of groups representing small businesses, the biotech industry, venture capitalists, and universities and technology groups across the country. Additionally, 945 U.S. small businesses today co-signed and sent a letter to the Congressional leadership in support of the Senate SBIR amendment to the NDAA. These businesses strongly believe that the immediate reauthorization of this critical program, along the lines of the Senate approach, is extremely important to our national economy.

The lawmakers added, "As representatives of Congressional districts where SBIR spurs innovation, creates jobs and exemplifies the successful possibilities of targeted government investment, we cannot risk letting this crucial program lapse."

Yesterday, Congresswoman Niki Tsongas was appointed to serve as a conferee on the NDAA conference committee. She will use this letter to illustrate the strong, bipartisan support in Congress for preserving this important program.

The full text of the letter follows:

Dear Chairmen McKeon and Levin and Ranking Members Smith and McCain:

As you craft a conference report for H.R. 1540, the National Defense Authorization Act for Fiscal Year 2012, we respectfully ask that you retain Senate-passed provisions reauthorizing the Small Business Innovation Research (SBIR) program. These provisions passed the Senate on a voice vote and carry bipartisan support in both chambers of Congress.

As you know, the SBIR program has increased our nation's access to innovative ideas, technologies, and capabilities through the programs' support for entrepreneurs and small businesses. This bipartisan program is often described as the most successful federal government R&D program. In it's 30-year history, it has proven to be particularly critical to the Development of Defense, providing our military with a wide range of technologies that have improved aircraft launch safety, biological toxin detection, fuel tank protection, advanced threat targeting, and personnel protection, among many others. It has also helped to grow private sector companies which not only produce the equipment and technology that help keep our servicemen and women safe, but also employ tens of thousands of Americans in a variety of high-paying research and manufacturing jobs.

Yet several years' worth of short-term extensions have created significant uncertainty for both the federal government and for the small businesses that create jobs. Given the importance of the SBIR program to our Armed Forces, enactment of the reauthorization in this year's NDAA is appropriate. It also represents the best opportunity in several years to provide certainty for the Department and other federal agencies as they budget for the program.

Specifically, we support the Senate-passed call for a long-term reauthorization that maintains the program's original intent: fostering innovative and cutting-edge research at small businesses. The Senate amendment rightly codifies the compromise endorsed by the Biotechnology Industry Organization, the Small Business Technology Coalition, the National Small Business Association, the U.S. Chamber of Commerce, the National Federation of Independent Businesses, the National Venture Capital Association, and universities and technology groups across the country to expand the participation of firms that are majority-owned by venture capital (VC) companies beyond current law without allowing such firms to crowd out true innovative small businesses.

Likewise, the amendment preserves the current program's merit-based principles instead of enacting a new and arbitrary quota system. Under the Senate-passed provisions, if the Department of Defense determines that a specific SBIR proposal is most likely to provide the military with the quality technology necessary for protecting our troops, the Department retains its freedom to invest in that technology regardless of how many SBIR awards the developer has previously won. Similarly, the amendment retains Phase 1 of the award process, guaranteeing that concepts prove feasibility before receiving a major investment from the federal government.

As representatives of Congressional districts where SBIR spurs innovation, creates jobs and exemplifies the successful possibilities of targeted government investment, we cannot risk letting this crucial program lapse. We appreciate your past support for the SBIR program and respectfully request its inclusion in the conference report for H.R. 1540.

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