Washington—A proposal authored by Senator Evan Bayh (D-IN) to increase funding for the Small Business Innovation Research (SBIR) program was unanimously approved today by the Senate Small Business and Entrepreneurship Committee. The proposal would provide more resources for cutting-edge research and development by entrepreneurs and small business owners.

The SBIR/STTR Reauthorization Act of 2008 would increase federal support for thousands of small business innovators nationwide. Under current law, all federal agencies with R&D budgets of over $100 million are required to set aside 2.5 percent of those budgets for small businesses. The Bayh measure would increase this threshold to 3.5 percent, which would increase funding available to small business innovators by an estimated $800 million over the next 10 years.

“Our nation’s competitiveness in the global economy hinges on our ability to cultivate the entrepreneurial spirit and provide a policy environment that helps our nation’s job creators expand small businesses,” Bayh said. “Increasing SBIR funding will help fuel the growth of our small businesses, strengthen our economy and create jobs at a time when such action is greatly needed.”

The Small Business Innovation Research program provides approximately $2 billion annually to 5,000 small businesses nationwide for innovative technological research and development. Nearly $17 million in SBIR funding was awarded to 46 different Hoosier small businesses in 2005 for innovations in fields such as military technology, agriculture, manufacturing, biotechnology and medicine. In Indiana, small businesses account for nearly 97 percent of all Hoosier companies and employ nearly 1.3 million people, or roughly half the state’s total workforce.

“Small businesses are instrumental to the success of our state economy,” Bayh said. “This funding will help create jobs here in the Hoosier state and keep Indiana on the cutting edge of advanced research.”

The Bayh measure will be part of Senate-House negotiations to reauthorize the SBIR program for 14 years. Those negotiations are expected to begin this week.

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