Mr. Goldwater, 'The innovative sector of the American economy, 

 science, small science and technology-based enterprises are vir- 

 tually excluded from effective participation. Small business, the 

 most effective sector of the economy receives a mere 3.5 percent of 

 the $30 billion Federal R&D expenditures in 1980." 



The legislation was passed. The 1986 White House Conference 

 took up this issue and was ranked as the 14th highest issue that 

 the legislation be reauthorized, strengthened, and expanded. In the 

 White House Conferences that are being held around the country 

 today, it remains an important recommendation and one of the top 

 recommendations on innovation and science sessions that are being 

 conducted right now. 



The truly great thing about the SBIR legislation is that it has 

 one of the highest returns to the taxpayer. It simply reprograms 

 money that would have gone to large firms, universities and Gov- 

 ernment labs which are far less efficient, far less innovative, and 

 less able to commercialize their technologies. One of the surprising 

 studies that we have found is that small businesses under this pro- 

 gram are as likely to commercialize the technology, between 30 and 

 40 percent, as the private sector with its own money which is a 

 phenomenal rate since you figure that virtually none of the Federal 

 R&D money, other than this program, really results in significant 

 commercialization. So, it is truly a marvelous program. 



Unfortunately, small businesses' share of total R&D expenditures 

 really still are around 3 to 4 percent. They really have not gone up 

 very much. Had we not had this program, those numbers would 

 have gone down even more. 



In my written testimony, I highlighted a number of studies and 

 the fact there were seven full GAO reports and three other reports, 

 all reviewing this program. It is probably one of the most studied 

 programs and I share the conclusions of these reports, that this is 

 truly a great program. Over 30 States have implemented SBIR as- 

 sistance programs and it is in fact, one of those private, public 

 partnerships that has really worked and is important and needs to 

 be maintained and strengthened. 



Thank you. 



[Mr, Glover's statement may be found in the appendix.] 



Chairman TORKILDSEN. Thank you very much, Mr. Glover. Now 

 I would like to ask the person who is no stranger to this committee, 

 Mr. Robert Neal, for his testimony. 



TESTIMONY OF ROBERT L. NEAL, ASSOCIATE DEPUTY ADMIN- 

 ISTRATOR FOR GOVERNMENT CONTRACTING AND MINOR- 

 ITY ENTERPRISE DEVELOPMENT, U.S. SMALL BUSINESS AD- 

 MINISTRATION 



Mr. Neal. Thank you, Mr. Chairman. Mr. Chairman and distin- 

 guished members of the subcommittee, it is my pleasure to be be- 

 fore you today to talk about the successful, high technology pro- 

 grams administered by the Small Business Administration, the 

 Small Business Innovation Research Program, and the Technology 

 Transfer Pilot Program. 



The purpose of the Small Business Innovation Research Program 

 is to involve the small business entrepreneur in the Federal re- 

 search and develop agenda and to promote commercialization of 



