From the Office of Senator Kerry

Thursday, June 21, 2001

WASHINGTON, D.C. - Chairman John F. Kerry (D-MA), along with Ranking Member Kit Bond (R-MO), today held a hearing of the Small Business Committee to call for the reauthorization of the Small Business Technology Transfer (STTR) Program, increasing funding to small businesses by $150 million by 2007.

First passed by Congress in 1992, the highly regarded STTR program is set to expire at the end of this fiscal year - September 30, 2001. Originally developed as a pilot program to move ideas from the research to product stage, the STTR continues to successfully link small businesses with universities and colleges, non-profit research institutions, and federal laboratories, to develop promising research that might otherwise just be forgotten in a lab. Each agency that has an extramural R&D budget in excess of $1 billion annual sets aside 1.5 percent for STTR competitive awards and contracts. Currently the program is about $65 million a year, and five agencies participate in the program -- Defense, Energy, Health and Human Services' National Institutes of Health, NASA, and the National Science Foundation. Reauthorization of the program will extend the program through September 30, 2010.

"STTR unites small businesses, universities, and government in a dynamic combination of ingenuity and resources," said Chairman John F. Kerry. "This collaborative effort results in amazing innovations- benefiting all sectors, both public and private. STTR has brought fledgling businesses, sitting on the cusp of the digital divide, into the ring of high-tech competition, and it's critical that we rewnew that effort with even greater investments."

"The success of the STTR is one of the best-kept secrets in the country, when it should be front page news," said Bond, the Committee's Ranking Republican. "It has proven to be immensely successful at helping small businesses thrive in some of nation's most-fertile high-tech corridors, including Silicon Valley and the Route 128 corridor in Massachusetts. With more nurturing by Congress, STTR can spawn similar growth in hundreds more communities around the country that contain universities and federal laboratories."

The General Accounting Office report, released today, found that the STTR program was very successful in transferring technology into the private marketplace and found 45% of the projects funded by the project had commercial sales within five years, and almost half of the companies had received patents for their technology. These companies have already had sales of $132 million and expect an additional $900 million in the next five years.

Citing the GAO's findings that about 90 percent of participating firms deem their partnerships with research institutions beneficial in achieving their technical goals and noting $132 million in sales and $53 million in additional development spurred by STTR grants from 1995 to 1997, Bond said "the Committee would be remiss if it did not seek expansion of the STTR program."

With the reauthorization, funding to the program benefitting small businesses will gradually increase over a five-year period, ending with a total increase to .5% or approximately $150 million by 2007. S. 856 also requires participating agencies to implement an outreach program to research institutions and strengthens the data collection requirements regarding awards and the data rights for companies and research institutions that conduct STTR projects.

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