SSTI Digest

The State of Arkansas has enacted several initiatives this year to assist science, technology, and research within the state. The two largest efforts are a $10 million research fund and a loan forgiveness program. Arkansas Research Matching Fund In an effort to improve the state’s national ranking of 49th place in research performance, the Arkansas General Assembly created the Arkansas Research Matching Fund. The $10 million fund will be administered by the Arkansas Science & Technology Authority, the state’s lead agency for R&D funding and technology-based economic development. (URL: http://www.state.ar.us/asta/ ) The $10 million appropriation is to fund the program for the next two years.

President Clinton has declared September 19 through September 25 Small Manufacturing Week to recognize the economic contributions and national importance of America’s 385,000 small and medium-sized manufacturers.

On September 21-22, the Manufacturing Extension Partnership of the National Institute of Standards & Technology (MEP), the National Association of Manufacturers, and the Modernization Forum are holding a Manufacturing Summit at the Ronald Reagan International Trade Center in Washington, D.C.

Topics to be addressed during the Summit will include:

In the coming days, Congress will be acting on appropriations bills for the coming fiscal year. The consequences for science and technology are profound.

As a result, the Digest is departing from its usual format of summarizing the news to present opinions on the budget battle from: Allan Bromley, the presidential science adviser in the Bush Administration; John Podesta, President Clinton’s Chief of Staff; and, Representative James Sensenbrenner (R-WI), chair of the House Science Committee.

Dr. Bromley’s article originally appeared in the Washington Post. Our thanks to them for permission to reprint it.

Due to the length of Mr. Podesta’s remarks, we have condensed the speech he originally made at the National Press Club. His full speech can be found on the White House’s home page at http://www.whitehouse.gov  

America is on a roll. We’re balancing the federal budget, reforming welfare and making retirement secure. Sound like a breakthrough in fiscal management? Not exactly. Our awesome economic success can be traced directly to our past investments in science. The problem is, this year’s federal budget for science is a disaster, and it compromises our nation’s economic and social progress.

Here are the latest budget numbers: NASA science is slashed by $678 million; science at the Department of Energy is cut by $116 million; and the National Science Foundation ends up with $275 million less than the President requested. Clearly, Congress has lost sight of the critical role science plays in America.

....This morning, I'd like to explain why we believe that continued federal investments in research and development are so important, and why we're so troubled by the Republican attack on our science and technology budgets. We should all be working toward bipartisan progress -- not playing politics with an issue so fundamentally crucial to our nation's future.

Investments in science and technology -- both public and private – have driven economic growth and improvements in the quality of life in America for the last 200 years.

Many of the products and services we have come to depend on for our way of life in America -- from lasers to communications satellites to human insulin -- are all the products of US policies to encourage investments in science and technology....

I am encouraged by the Administration’s sudden interest in science funding. Over the last seven years, overall science budgets, which include both defense and civilian R&D, when indexed for inflation, have been flat or decreasing. Science needs a boost.

Unfortunately, the President’s Fiscal Year 2000 (FY2000) budget depends on budgetary tricks such as tax hikes and user fees that will never be enacted. In fact, the House of Representatives defeated the President’s FY2000 budget request by a vote of 426-2 and the Senate defeated it 97-2. This gimmickry significantly overstates the amount of money that can be made available for R&D.

Buoyed by a strong national economy, venture capital firms have invested at an all-time during the 2nd quarter of 1999, according to the latest quarterly survey by PricewaterhouseCoopers. At $7.61 billion for the quarter, venture capital investments were more than double the total reported only one year ago. The current survey reflects the investment activity of 684 venture capital firms.

Three of the last four surveys have revealed record levels of investment. The previous high, set in the first quarter of 1999, was $4.31 billion -- 41 percent over the earlier record of $3.77 billion set during the third quarter of 1998.

Last week, Indiana Governor Frank O'Bannon named the Board of Directors to oversee the design and administration of the new 21st Century Research & Technology Fund. By law, the Lieutenant Governor serves as chairman for the board.

Earlier this summer, the Indiana General Assembly approved a budget for the initiative of $50 million for the next two years for the initiative. This level of funding, coupled with the existing programs of the Indiana Business Modernization Technology Corp. (BMT), moves Indiana into the top tier of states investing in technology-based economic development.

The 21st Century Research and Technology Fund is to provide grants and loans that support economic development by addressing one or more of the following goals:

Small companies' interests in developing environmental technologies appear to growing. Between 1998 and 1999, the Environmental Protection Agency (EPA) saw a 64 percent increase in the number of SBIR Phase I proposals submitted. The number of awards made by the agency was unable to keep pace, growing by only 30 percent. As a result, EPA was able to fund less than 9 percent of the 535 SBIR Phase I proposals received in 1999. In 1998, more than 11 percent of the proposals were funded.

The accompanying table presents the distribution of EPA awards and proposals by state.

Abstracts of EPA awards for the 1999 SBIR Phase I solicitation have not been posted on their website currently but should be soon. The web address is: http://es.epa.gov/ncerqa/sbir/

Taratec Corporation of Columbus, Ohio has been awarded a $44,500 contract from the Department of Commerce's Office of Technology Policy (OTP) to prepare a report of science & technology indicators for all 50 states. The indicators are intended to assist Commerce in evaluating the impact and outcome of projects funded by the Experimental Program to Stimulate Competitive Technology (EPSCoT) as well as other OTP programmatic improvements.

The solicitation, released in early July says the report will be completed for Commerce in 18 weeks (refer to the 7/2/99 SSTI Weekly Digest Addendum for more details). Commerce will be responsible for any further publication and distribution.

For more information, contact Anita Balachandra with the EPSCoT program at 202/482-8004 or by email at Anita_Balachandra@ta.doc.gov

The September 3, 1999 issue of the SSTI Weekly Digest contained some errors in the SBIR tables. The correct information is below. Revised tables are available for review on our website at:  http://www.ssti.org/Digest/Tables/090399t.htm

In the Department of Education's SBIR Phase II awards, the totals for Michigan and Minnesota were inadvertently switched. There were no Phase II proposals received nor awards made to Michigan firms this year. Minnesota firms submitted two proposals, both of which were selected for Phase II funding.

U.S. Department of Commerce Secretary William Daley has labeled as Amisleading@ a press release issued by the House Science Committee regarding the proposal review and selection criteria of the Advanced Technology Program (ATP). [See August 27, 1999 issue of SSTI Weekly Digest.] In the release, Rep. Sensenbrenner, the Chairman of the Committee, questioned the program's commitment to ensuring federal grants were not displacing private capital.

The Department of Commerce disputes that criticism.

"With respect to ensuring that project applicants adequately demonstrate the need for Federal funding, the ATP requires applicants to provide convincing assurances at several stages in the review process,@ said Daley in a letter to Rep. Sensenbrenner. AATP rejects proposals that fail to make a convincing argument that the work could not be entirely funded by industry."