Good morning. I am pleased to be able to appear before

your Subcomittee in order to describe the role of research and development (R&D) within the Department of Defense (DoD) and its relation to domestic technology transfer.

The Department conducts an agressive R&D program to maintain U.S. defense capabilities at the leading-edge of technology so that our scientists, engineers, and the manufacturing community can design and produce military weapons systems at the highest level of efficiency and effectiveness. key element of U.S. defense strategy in weapons development is to promote R&D for the purpose of weapons superiority in order to balance large numerical imbalances.

To accomplish our national security goals the R&D program is carried on by industry, universities, National Laboratories, Service laboratories, and other organizations such as the National Institutes of Standards and Technology. While the private sector performs about 75 percent of DoD's R&D, there is no arbitrary policy on organizational distribution, and selections are made in order to best achieve technical goals. We routinely organize teams within industry or among industry, universities and other laboratories. When there are common

interests we jointly fund activities with other parts of the Government, such as the Department of Energy (DOE) or the National Aeronautics and Space Administration (NASA).

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We are sensitive to the need to maintain a strong

university community. Our research activities at colleges and universities provide both salaries and dissertation support for many students, particularly in the sciences and engineering. Our support of research programs is an essential element of the intellectual thread necessary to weave a strong technology base in the U.S. We strongly support the belief that students and faculty at colleges and universities have not only the right but an obligation to disseminate their research findings throughout the scientific community, so the vast majority of our work at those institutions is totally unclassified.

Before explaining the overall basis of DoD's domestic technology transfer activities it is important to establish some facts about the Department's funding of R&D. The basic research or 6.1 programs are funded at $955 million. The exploratory development or 6.2 programs (the analogue of applied research) are funded at $2.5 billion. Advanced technology development or

6.3A programs are funded at $2.3 billion.

These three budget

categories equate the 15 percent of the total DoD R&D investment. This does not include the Strategic Defense Initiative activities. The remaining funds in budget categories 6.3B through 6.5 involve design, engineering, testing and evaluation of specific weapons systems. The emphasis on development is essential if the RDT&E program is to accomplish

state-of-the-art military hardware. DoD is unique among federal agencies in the emphasis on systems development. This reflects the Administration policy to limit Federal support for development to areas such as Defense. In other areas product development is appropriately supported by the private sector.

DOD plays a modest role in Federally supported research, providing about 9 percent of the total Federal support for basic research and about 25 percent of Federal funding for applied research. DOD is dominant in Federal support for development, accounting for 83 percent of the total. These are FY 1989 figures.

Much of the R&D supported by the Department is so-called dual use technology, applicable to both Defense needs and commercial requirements. Most of that work is unclassified. While some of the companies that receive DOD R&D support concentrate their sales in the defense sector, many others are active in both defense and commercial arenas, e.g. International Business Machines (IBM), American Telephone and Telegraph

(AT&T), General Electric (GE), General Motors (GM), Ford, Boeing, Texas Instruments (TI), Westinghouse, Xerox, and many others. Eight out of the top ten DoD contractors have significant commercial activities. Dual use technology developed for DoD at those firms inevitably affects both their

defense and commercial products.

This is probably the most

effective mechanism for rapid and efficient domestic technology transfer.

The Department's current policy structure and activities in implementing the DoD domestic technology transfer program are pertinent. The program is based upon the Stevenson-Wydler Technology Innovation Act of 1980, the amendments to StevensonWydler incorporated by the Federal Technology Transfer Act of 1986, and the President's Executive Order 12591 on "Facilitating Access to Science and Technology" of April 10, 1987. The Department's current policy directive fully implemented the provisions of those statutes and the Executive Order. The Federal Technology Transfer Act grants direct statutory authority to the Departments of Army, Navy, and Air Force to execute the programs. As a result the DoD policy directive establishes a broad framework for the Department and prescribes Department-wide policy where consistency of approach is warranted. Within that policy structure, the Military Departments have defined their implementations of the program within their organizational and operational frameworks. testimony will explain their program to you. The principle elements of the DoD program are:

Their

1. DOD policy provides for a full-time equivalent position for an Office of Research and Technology Application