Federal funds key, small-business owners tell Pryor
Posted on Friday, August 22, 2008
Entrepreneurs told U. S. Sen. Mark Pryor on Thursday of the importance of reauthorization and increased funding for two federal programs.
Tom Jakobs, president of Alma-based InvoTek, said funding from the Small Business Innovation Research program has been critical for his company, which designs devices to allow severely disabled people, such as those who can’t use their hands or don’t have natural speech, to use computers.
“The commercial market for our products is relatively small,” Jakobs said. “It’s entangled in Medicaid and Medicare, so commercialization issues are pretty tough.”
The market’s small size means that it’s difficult to fund the innovations required to enable people with disabilities to be able to take advantage of the technology available to others, Jakobs said.
The entrepreneurs also want Pryor, a Democrat from Arkansas, to work to limit or eliminate the access that companies partly owned by venture-capital firms would have to funding from the federal programs under legislation being considered in Congress.
Venture-capital firms are companies that typically invest in new and quickly growing companies. Participants who met with Pryor at the University of Arkansas at Little Rock noted Arkansas companies have less access to venture capital than those based on the East and West coasts.
Emerging federal legislation would reauthorize the Small Business Innovation Research program, which expires Sept. 30, and the Small Business Technology Transfer program, which expires one year later.
Pryor is on the Small Business and Entrepreneurship Committee, which wrote the Senate’s version of the bill. The bill is awaiting action from the full Senate. Another version has passed the House of Representatives.
“Probably John Q. Public doesn’t have any idea how this stuff really works, but this is a way that we can reinvest federal dollars into our communities and make a huge difference, not just for our local communities but for the U. S. economy,” Pryor said of the programs.
“It really has a great ripple effect. There’s a lot of capital out there looking for projects, but venture-capital firms don’t fit with every innovative idea that’s out there.”
More than $ 2 billion each year is given to small businesses under the programs, which are funded through several federal agencies.
The Senate bill, Pryor said, would extend the funding for 14 years instead of the House’s two years.
Several Arkansas companies have received millions of dollars in funding from the programs.
At least 15 awards from the Small Business Innovation Research program went to Arkansas companies in fiscal 2007, said Gwen Green, spokesman for the Arkansas Small Business Development Center. A list with many of the Arkansas winners from both programs is available at http: // asbdc. ualr. edu / technology / awards.
Dr. Laura James, a University of Arkansas for Medical Sciences researcher based at Arkansas Children’s Hospital, said all of the funding for her company, Acetaminophen Toxicity Diagnostics, comes from the Small Business Technology Transfer program in the form of a twoyear $ 400, 000 grant.
James and her partners are developing a “dipstick” kit similar to urine pregnancy tests that could be sold to hospitals to rapidly diagnose liver failure due to overdose of acetaminophen, the active ingredient in Tylenol.
“If you look nationally at cases of liver failure in the United States today, acetaminophen [overdose ] is responsible for about half of those,” she said. “There’s a lot of misuse of the product.”
James supports more funding for the program in the early stages of a product’s development.
“It’s hard to do what we’re trying to do with the budget we have,” James said.
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