By : DAVE LARSEN
Source : http://www.stripes.com
Category : Small Business Grant
A program that encourages small businesses to perform research and development for NASA, the U.S. Department of Defense and other federal agencies has provided millions of dollars to Dayton-area companies and helped them to commercialize such high-tech innovations as pressure-sensitive paint and flexible, heat-activated repair patches.
The federal Small Business Innovation Research (SBIR) program provides critical seed funding for American-owned small businesses engaged in high-tech or research pursuits. The competitive program enables companies to explore their technological potential and provides the incentive to profit from its commercialization. NASA’s SBIR program is the third largest of the 11 federal agencies that are required to participate in the program, awarding an average of $112 million annually to small businesses from 2004 through 2008.
“What we are getting from them is a huge return on taxpayer investment in technology,” said Mason Peck, NASA’s chief technologist. “It benefits the space program; it also helps grow our own economy.” Since its enactment in 1982, the SBIR program has made more than 112,500 awards through fiscal 2009 totalling more than $26.9 billion. SBIR Phase I awards normally do not exceed $150,000 total costs for six months. Phase II awards normally do not exceed $1 million total costs for two years. However, SBIR is not without its problems and critics. The NASA Office of Inspector General audited NASA’s SBIR program after internal investigations identified cases of fraud, waste and abuse in the program that raised questions about the overall effectiveness of the program’s internal controls.
The audit included all SBIR technical proposals submitted to and contracts awarded by NASA for program year 2008.
A review released in January 2011 found that while NASA’s initial choice of SBIR award recipients appeared objective and merit-based, its oversight and monitoring of awards was deficient. Specifically, SBIR awards in 2008 contained an estimated $2.7 million in unallowable and unsupportable costs, including travel and equipment expenses.
From 2007 to 2010, nearly $93 million in federal SBIR funding went to 55 Dayton-area companies, officials said.
Small businesses are eligible to participate in the SBIR program if they are organized for profit and are located in the U.S.; are at least 51 percent owned and controlled by one or more people who are U.S. citizens or permanent resident aliens; and have no more than 500 employees, including affiliates.
Cornerstone Research Group “would not exist without the program,” said Patrick Hood, president and chief executive of the Beavercreek Twp. company that specializes in advanced materials, systems engineering and manufacturing technologies.
CRG has received 18 SBIR program contracts with NASA since 2000 totalling more than $4.88 million, according to the U.S. Small Business Administration.
Hood started CRG in 1997 in his basement with 100 percent SBIR funding. CRG now has more than 60 employees and created three spinoff companies to market products originally funded by NASA and other agencies, with combined annual revenues of more than $10 million, he said.
For example, a $70,000 NASA SBIR award in 2005 for flexible, heat-activated structural patches led to two commercial products known as Rubbn’Repair and Rec’Repair that are used in the automotive and outdoor adventure markets.
SBIR funding has allowed CRG to compete against contractors with “infinite resources” such as Lockheed Martin and Boeing Co., Hood said. “The small business program levels that playing field where your ideas are more important than the size of the organization,” he said.
Innovative Scientific Systems Inc. has received 13 SBIR Phase I and seven Phase II awards over the last five years that total several million dollars, said Grant McMillan, the company’s head of business development.
“The primary role that we see for the SBIR program is as a vehicle to help us with the development of commercial products,” McMillan said.
ISSI, also based in Beavercreek Twp., is focused on aerospace and automotive research and development. Founded in 1995, the company has 70 employees and overall annual revenues of more than $13 million, McMillan said.
About two-thirds of ISSI’s business is providing on-site support at the Air Force Research Laboratory at Wright-Patterson Air Force Base. More than 20 percent of the company’s revenues come from SBIR funding and 10 percent comes from commercial sales, McMillan said.
ISSI has commercialized a number of high-tech instrumentation and measurement products whose development was funded through SBIR grants from NASA, the U.S. Air Force, Navy and National Institutes of Health.
The company used NASA funding to develop pressure- and temperature-sensitive paints, which are used in wind tunnels for new aircraft and automotive design to measure pressures and flow patterns over a large area. The products have “significant commercial sales” worldwide, McMillan said.
ISSI currently is developing a patented technology called Surface Stress Sensitive Film, which can be used to measure pressure and sheer forces over its entire surface.
The Navy’s Office of Naval Research was an early SBIR sponsor of the technology, which can measure drag and other flow characteristics on ship hulls to improve design.
ISSI along with several partners has received an NIH SBIR award for a biomedical application for the product.
“The NIH is very interested in this for diabetes research for treatment and prevention of foot ulcers,” which is a primary health threat for people with diabetes, McMillan said.
Distributed by MCT Information Services
Source : http://www.stripes.com/news/us/federal-program-helping-innovative-businesses-1.171212
