20 



Dr. Barish. One vendor only. My interpretation of the law is that 

 it has to be for a current project, either a Phase I or a Phase II. 

 Many of the projects that we have supported, in fact, a large frac- 

 tion with the commercialization assistance project, are projects that 

 have completed Phase II several years down the road, but have 

 been unsuccessful in commercialization. We have been able to use 

 non-SBIR funds to help such project in commercialization efforts. 



With the legislation, I believe that you could not use the funds 

 for projects that have expired. So, that is one problem and the 

 other one is the $4,000 per year of support. That is somewhat dif- 

 ficult. 



Chairman Torkildsen. So is that consistent with what Mr. Lit- 

 tle testified to earlier about doing something in Phase III, possibly 

 using SBIR funds? 



Dr. Barish. That is a little different. What I think Mr. Little 

 would like to do is allow SBIR funds to be used in Phase III. The 

 law right now does not permit it. It only allows SBIR funds to be 

 used in Phases I and II. I think he would like to have cost-shared 

 Phase III. The Government could participate 50/50 with the small 

 business to help in Phase III commercialization efforts, Roger, if I 

 am correct? 



Chairman TORKILDSEN. OK. 



Dr. Norwood. Mr. Chairman, I would like to add a couple of 

 comments in support of two of the items that Dr. Barish just men- 

 tioned. First of all, providing support to the program. We agree 

 that it would be useful to allow flexibility in the SBIR set aside, 

 within that set aside, to be able to have flexibility to use a fixed 

 percentage, small fixed percentage of that program to administer 

 the program. Right now those administration funds must come out 

 of other R&D resources and in a declining and constrained budget 

 environment, it just adds further burden on our R&D Program. 



Also, it would be useful if we could change from the approach 

 that is in the current law about using the one vendor and the 

 $4,000 for commercialization activities and allow additional flexibil- 

 ity within the SBIR resources at a fixed rate to help us do commer- 

 cialization. 



Chairman TORKILDSEN. Has anyone in the panel thought along 

 those lines for administrative costs? If you were seeking a change 

 to allow SBIR funds for administrative costs, would you be looking 

 for a fixed percentage, and if so, what amount would you be seek- 

 ing? 



Dr. Norwood. Yes, I think a fixed percentage would certainly be 

 appropriate to safeguard everyone's interest and certainly some- 

 thing in the neighborhood of 2.5 to 3 percent would be sufficient, 

 at least from our viewpoint. 



Chairman Torkildsen. Dr. Barish, any thoughts on that? 



Dr. Barish. My written testimony and my oral testimony are 

 that a maximum — this is our agency — a maximum of 1 percent of 

 the SBIR funds could be used to support either administrative 

 costs for the program's operation with all of the proposal evalua- 

 tions, thousands of them, et cetera, and commercialization assist- 

 ance efforts, a maximum of 1 percent. 



Chairman TORKILDSEN. Mr. Glover, as the advocate, would you 

 have any concerns about doing something like that? 



