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Small Manufacturers Get a Boost

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June 23, 2004 -- In the hopes of giving small firms an edge in the face of outsourcing overseas, a new bill proposes to boost funding in the manufacturing sector.

The bill cleared its first hurdle Wednesday, winning 19-13 in a vote before the House Science Committee. The bill will fund grants for manufacturing research, create manufacturing research fellowships, and create an interagency council for manufacturing. It also reauthorizes funding for the Manufacturing Extension Partnership (MEP), a network of not-for-profit centers designed to guide small manufacturers through information technology and process improvements, and offer worker training.

The R&D grants are specifically designed to strengthen ties between private industry and academia. To be eligible, manufacturers and research institutions must work as collaborators, and share resources. The grants will then supply up to 33 percent of the funding for a proposed project.

"The issue of outsourcing is a serious one and steps that strengthen the manufacturing system are vital," says Joe Pouliot, a spokesperson for the House Committee on Science. "These are all initiatives to help strengthen the manufacturing sector." The bill, sponsored by Vernon Ehlers (R-MI) and Mark Udall (D-CO), ramps up funding for the MEP from $110 to $125 million over four years, and authorizes $37.5 million for manufacturing fellowships and research and development over four years and three years, respectively. It will head to the house for consideration in early July.

The MEP, first founded in 1988, was nominated this year for an "Innovations in American Government" award by Harvard's John F. Kennedy School of Government, which recognizes excellence and creativity in government service. In addition to offering best practices consulting services and worker training, the MEP acts as a liaison between small to mid-sized manufacturers and the National Institute of Standards and Technology, informing them of up-to-date technology and techniques.

In the 19-13 decision, Democrats (including co-sponsor Udall) opposed the bill, concerned it did not have "teeth," as Udall's spokesperson put it. Democrats hoped to include funding to construct new research labs, and authorize the Advanced Technology Program, which promotes collaboration between manufacturers and research labs. They also requested more funding for the MEP.

A representative from Vernon Ehlers's office said the bill's softening was a result of negotiations with the Bush Administration, which initially opposed the bill. Last year, Bush tried to cut the MEP's funding by 88 percent. Here, the Democrats' opposition was a case of "the perfect being the enemy of the good," Ehlers said during deliberations on Wednesday.


BURT HELM | Staff Writer | Senior Writer

Burt Helm is a senior writer for Inc. magazine.




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