Testimony of Bob Kavetsky, Energetics Technology Center (ETC) — Innovation Ecosystems & Small Business — Committee on Small Business

Summary

Written testimony of Bob Kavetsky, Chief Executive Officer of the Energetics Technology Center (ETC) in Indian Head, MD., headed as before the Committee on Small Business on Innovation Ecosystems & Small Business, dated 22 September 2021. The testimony describes ETC as a 501(c)(3) non-profit organization and addresses the role of small businesses and the Small Business Innovative Research Program (SBIR) in technology-based innovation ecosystems and national defense. It discusses an ETC study of energetics for the Department of Defense, stating that approximately 350 specialty chemicals are needed to produce energetic materials. It also describes a Navy SBIR outreach process called City TechFire being piloted in several cities. The testimony closes with recommendations, including making the SBIR/STTR programs permanent and increasing the SBIR allocation to 7 percent.

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                                             Testimony of



                                          Bob Kavetsky


                                        Chief Executive Officer
                                 Energetics Technology Center (ETC)
                                           Indian Head, MD.




                BEFORE THE COMMITTEE ON SMALL BUSINESS
                 UNITED STATES HOUSE OF REPRESENTATIVES


                Innovation Ecosystems & Small Business


                                           22 September 2021




ETC provides engineering and data analytics services, policy development, and technology development to
the government, academia, and private industry. ETC is a 501 (c)(3) non-profit organization incorporated
in Maryland in 2006.
Chairman Cardin, Ranking Member Paul, and Members of the Small Business Committee my
name is Bob Kavetsky and I am the CEO of the Energetics Technology Center (ETC). ETC is a
501(c)(3) that is headquartered in Maryland. It has been my great pleasure to head ETC for the
past 15 years. I am an engineer by training, and prior to joining ETC, I served 32 years at the
Department of Defense working on hypersonics and undersea warfare programs. I greatly
appreciate you giving me the opportunity to share my thoughts on the role of small business in
general, and the role of the Small Business Innovative Research Program (SBIR) specifically
with you today and look forward after my testimony to answering your questions.
You are all acutely aware of the important role small businesses play in our economy. My
fellow panelist has addressed the critical role the SBIR program plays in not only getting new
technologies into the hands of warfighters but also serving as an economic catalyst in many parts
of the country. I would like to direct my comments today to the role small businesses play in
what I like to call “technology-based innovation ecosystems” and the importance of these
ecosystems to our national defense.
MIT economists Gruber and Johnson, in their seminal work “Jumpstarting America” 1, do an
excellent job of documenting the benefits realized from government investments in creating
science-based innovations that came out of World War II. More importantly, they recommend
that the federal government make additional investments to position the U.S. to continue its
leadership role as a major economic and military power. Specifically, they identified 100
regions of the country that were ripe for the creation of technology-based innovation ecosystems.
They suggest, and I agree, that such an investment will result not only in distributing our
economic prosperity across the country more evenly but also contribute to a strong national
defense.
Innovation ecosystems bring together industry, academia, and government to provide technology
solutions to the government and private sector markets. Two prime examples of this are Silicon
Valley for the semiconductor and computer industries and Boston in life sciences. There is an
opportunity now to create a whole nation of ecosystems using programs such as SBIR as a
primary engine for this development. This is a critically important issue not only for our national
defense, but in addressing what I see as a developing economic inequality between regions of the
country that have these ecosystems and those that do not.
My organization recently completed a study of energetics for the Department of Defense.
Energetics are explosives and propellants that are used in our weapons systems. We brought
together experts from industry, academia and government, led by Dr. Theresa Mayer, Vice
President of Research at Purdue University to examine what has led to now well-documented
shortfalls in U.S. military capabilities when compared to China and Russia.


1
    Jumpstarting America, Gruber & Johnson.
These shortcomings can be traced in part to two major issues:
   1. our inability to develop and then transition these developments of advanced energetic
      materials into our weapons systems.

   2. the fragile condition of the existing supply chain of specialty chemicals needed to
      produce energetic materials.
Small businesses can play a role in addressing both of these challenges. For example, the SBIR
program has a strong record of creating solutions to defense requirements in critical sectors. We
envision such an investment in energetics would bring new and innovative companies into the
energetics research arena.
Second, we need to develop a network of specialty chemicals manufacturing and production
facilities to ensure a robust supply chain for energetics. Currently we need approximately 350
specialty chemicals to produce the energetic materials the Department of Defense needs. There
is absolutely no reason these chemicals cannot be produced by small and medium sized
businesses. This production does not need to be from industry giants. Most critically, we cannot
continue to buy these chemicals from our adversaries such as China.
The second example I would like to highlight is the work the Navy’s SBIR program currently
has us conducting to reach out and involve underrepresented communities and companies in the
program. The catalyst behind this effort is to ensure that the Navy is tapping into the full
potential of all of America – not just a handful of communities. We have created a process
called “City TechFire” which we are starting to pilot in Houston, San Diego, Phoenix, Detroit,
San Antonio, El Paso, Jacksonville, Cleveland, Greensboro, and Harrisburg. It is already
abundantly clear to me that there is a massive untapped potential in these communities.
In closing, I would like to make a few recommendations for the Committee to consider:
   1.   Make the SBIR/STTR programs permanent
   2.   Increase SBIR allocation increase to 7 percent
   3.   Increase STTR allocation to 1 percent
   4.   Expedite Security Clearances for SBIR/STTR firms
   5.   Require all agencies to set goals of at least 15% of all R&D goes to small business


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