As you read this, many House members will be working away on amendments to the House Armed Services Committee's National Defense Authorization Act for Fiscal Year 2011. The bill has been sent to the House Committee on Rules and is open for amendments until 5pm Tuesday, May 5, 2010. It is expected that the bill will come to the full House perhaps as early as Thursday.

An interesting addition to this large and important bill is a new program named "Department of Defense Rapid Innovation Program" Here is a portion of the bill's language:

The Secretary of Defense shall establish a program to accelerate the fielding of innovative technologies developed using Department of Defense research funding and the commercialization of such technologies.

Under the program, the Secretary shall, not less often than annually, solicit from the heads of the military departments, the defense agencies, and the unified combatant command for special operations forces applications for funding to be used to enter into contracts, cooperative agreements, or other transaction agreements entered into pursuant to section 845 of the National Defense Authorization Act for Fiscal Year 1994 (Public Law 103-160; 107 Stat. 1721; 10 U.S.C. 2371 note) with appropriate entities for the fielding or commercialization of technologies.

Click here for the complete section of this bill. Things in the overall bill are likely to change this week, then if passed, the Senate will be doing their version. Unlike NIH ARRA, there's no reason to believe that this program will exclude our community. We'll be sure to keep you up to date on this.

A Compromise Of O'Reilly & Olberman

With all the talk of SBIR compromise, I'll attempt a compromise between two polar opposites, Bill O'Reilly of Fox News and Keith Olberman of MSNBC. Of course there is a political component to this, but our mission over the next few weeks will be to inform you of small business, SBIR friendly politicos, and those that are�. well�. let's say.. less than supportive of your program.

Olberman does a tongue-in-cheek feature known as "The Worst Person in the World", while O'Reilly (who is often Olberman's choice for that honor) does a segment called "Pinheads and Patriots." With that in mind, we'll have the SBIR Insider's inauguration of "The Worst Pinhead in the World!"

Leading that "honor" is none less than Nydia M Velazquez, (D-NY), a nine term congresswoman who has been chair of the House Small Business Committee (SBC) since 2006. New York's 12^th district was perfectly gerrymandered to suit a candidate such as Nydia and, as in so many previous years, she faces no substantive competition for reelection.

In essence, she can probably be "congresswoman for life" since the district is made up of a Latino majority (largely Puerto Rican) and Velazquez was the first Puerto Rican woman elected to the U.S. House of Representatives.

Being from a financially poor district, Velazquez (a multimillionaire) requires help to raise the monies needed to contribute to her party in order to remain in a powerful congressional role of a committee chair. Hence the lobbyists and contributors from outside New York provide more than 70% of her funds for 2010.

Not surprisingly, the largest sector contributing is from the world of finance, with the top industries being the investment community. Her top contributors include the National Venture Capital Association (NVCA), Omega Investments, and the Service Employees International Union (source: The Center for Responsive Politics).

Velazquez stays popular by appearing to legislatively work hard for her constituents, in spite of the fact that she gives precedence to the Wall street and VC community over small businesses. Of course we all know how generous Wall street is to the Latino community.

Statistics from Govtrack.us doesn't paint a pretty picture of her performance as a legislator. It states that since the beginning of Velazquez's congressional career (1993), she has sponsored 111 bills of which 94 haven't made it out of committee! They report that 6 were successfully enacted and I think we can count 3 of those as her 3 month SBIR extensions.

In a recent statement to the House Committee on the Budget, Ms. Velazquez stated: "Without the participation of venture-backed companies, the SBIR program has become little more than corporate welfare for marginal companies who are unable to secure external market based funding."

In an earlier effort to revise the SBIR statute to allow majority ownership and control of small businesses by non-small business VC firms, Velazquez stated: "During this modernization effort, the Committee will make certain that the SBIR program is providing the resources for economically viable technologies � and not wasting its efforts on second-rate science fair projects."

Velazquez has been an impediment to the SBIR program, trying to use it as a cash cow for raising funds from biotech and VC communities, and only allowing a 2 year reauthorization which coincidentally correlates to the election cycle. She also tried unsuccessfully to block the House and Senate Armed Services Committees' move to extend the DoD's portion of the SBIR/STTR programs through the end of FY-10 (September 30, 2010).

By the way Ms. V, did you know that over 99% of the small businesses in the U.S. do not have VC funding? You're truly deserving as the SBIR Insider's first (and probably last) Worst Pinhead in the World��

Folks, not to worry, we'll have no more of that pinhead stuff, but we will point out the heroes and detractors of the program you love. What you do with that information is up to you.

Thanks again for your time and we welcome your comments.

Sincerely,

Rick

Rick Shindell
SBIR Gateway
Zyn Systems
40 Alderwood Dr.
Sequim, WA 98382
360-681-4123
[email protected]
www.zyn.com/sbir

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