Accordingly, it would be helpful to consider methods that could be used to improve the skills of technology managers and scientists in negotiating agreements with the private sector.

Several agencies also have indicated that they may be unable to hire enough patent attorneys to support their technology transfer programs. These agencies note that patent lawyers command far higher compensation in the private sector than federal agencies can hope to offer. Contracting for such services may be an available alternative. Patent counsel are essential to the process of determining patentability, drafting technical documents, and negotiating advantageous licensing arrangements. The FTTA does authorize agencies to use royalties to pay for such services. Perhaps as royalties increase this problem may be somewhat eased.

At the present time, the Department of Commerce does not believe it has sufficient data to justify any specific recommendations. However, these personnel matters warrant careful monitoring. We expect to return to it in the next biennial report.

In September 1988 the U.S. Office of Government Ethics (OGE) advised the Department of Commerce that royalty sharing under the FTTA is "a form of compensation from the Government which does not cause an employee to have a personal financial interest to

which the conflict of interest laws are applicable." OGE noted that under the statutory scheme, a federal employee is not placed into a direct relationship with the party paying royalty fees.

However, agency employees remain bound by the statutory provision (18 USC 207) that bars a former federal employee from representing another person before an agency on matters that the ex-employee worked on while at the agency. Any matter in

connection with the invention in question would appear to bring that section into play.

In addition, some agencies, while aware of OGE's opinion, believe that their particular mission may obligate them to impose special rules. The Food and Drug Administration, for example, has expressed concern about potential conflicts that could arise when its scientists stand to profit from inventions that cannot be marketed without that agency's express approval. FDA is in the process of reviewing its regulations to ensure that its concerns are addressed without unduly limiting the ability of its personnel to take advantage of the opportunities accorded them by the FTTA.

The Commerce Department expects shortly to issue FTTA conflict of interest guidelines to assist agencies in this area and will be pleased to work with them individually, if requested.

8. Conclusion:

In summary, progress to date under the FTTA has been good.

Agency administrative personnel understand the Act's
merits and are anxious to make it even more effective.

Laboratory personnel are becoming more and more interested in making their work useful to the private sector.

U.S. firms are becoming increasingly aware of the Act and in many cases are finding out that the federal laboratories are conducting research that can valuable to them.

There is still work to be done, but the Act's goal of fostering a new era of scientific and technical cooperation between the public and private sectors appears well on the way to becoming a reality.

Question: At the present time, what review of laboratorynegotiated cooperative research and development agreements is required at the Air Force headquarters level?

Answer: There is no requirement for laboratory-negotiated Cooperative Research and Development Agreements (CRDAs) to be reviewed at the Air Force headquarters level.

The draft Air Force Regulation on Domestic Technology Transfer stipulates that the laboratory Commander shall enter into a CRDA, and that the official to whom he or she reports, or his or her designee shall review all negotiated Cooperative Research and Development Agreements (CRDAS).

Laboratory-negotiated CRDAs are reviewed by the Science and Technology Directorate of the Air Force Systems Command, the major command to whom all laboratories report. The reviewing official has authority to approve, disapprove, or require modification of any CRDA, each of which shall provide a 30-day period within which such action must be taken beginning on the date the agreement is received by the reviewing official.

Question: Is the requirement that adverse action on any such negotiations be handled within 30 days from date of receipt by your department being complied with?

Answer: Yes. Also, there has been no adverse actions.

Question: What regulations and instructions still must be promulgated by your service to fully implement the cooperative R&D authority? What is the timetable?

Answer: To fully implement the cooperative R&D authority, an Air Force regulation (APR) must be promulgated. AFR 80-XX, Domestic Technology Transfer, which will establish Air Force policy, delegation of authority, and procedures for domestic unclassified technology transfer by Air Force organizations has been extensively coordinated throughout the Air Force, especially within the legal community, and is currently in the publishing division for editing and typesetting.

AFR 80-XX delineates procedures for entering into CRDAS with non-federal parties, commercialization of Air Force technology, licensing of inventions, and the distribution of royalty income resulting therefrom. It also defines the responsibilities of Offices of Research and Technology Application. A model CRDA is attached to the proposed regulation to provide guidelines for negotiating and entering into CRDAs, and which may be tailored for each negotiation.

It is anticipated that AFR 80-XX will be promulgated before the end of the year.

Question: In the next year or so, what level of growth do you expect in the number of cooperative R&D agreements

Answer: To date, twenty-four Air Force CRDAs have been or are currently being negotiated. These CRDAs have been negotiated with state and local Governments, academia, and private industry. Our progress in entering into CRDAS will accelerate as we become more familiar and comfortable with the legislation. We anticipate a 30% increase in the number of CRDAS in the next year.

Question: With regard to Section 11(a)(3), how has your Service insured that technology transfer is being considered positively in laboratory job descriptions, employee promotion policies and evaluation of job performance of scientists and engineers in your laboratories?

Answer: The draft Air Force regulation stipulates that each Air Force research, development, test and evaluation (RDT&E) activity is required to incorporate technology transfer objectives into the mission of its activity, and shall encourage that efforts to transfer technology be recognized in evaluation of the job performance of scientists and engineers.

A policy statement from the Office of the Secretary of the Air Force will be promulgated to all laboratories stipulating that technology transfer efforts must be considered positively in laboratory job descriptions, employee promotion policies, and evaluation of scientists and engineers in the laboratory. anticipate this letter of policy will be promulgated before the end of the year.

We

Question: Have your laboratories established Offices of Research and Technology Applications (ORTA's) and staffed them as required by law?

Answer: The Air Force has established ORTAS at each laboratory as specified in the legislation. In addition, there is a domestic technology transfer functional office established within the Office of the Assistant Secretary of the Air Force Acquisition. This office makes reports to Congress, and promulgates regulations and operating procedures.

Question: Are there any legislative changes to the law which you believe would be desirable?

Answer: Although the Air Force has no specific legislative changes to propose, there are two areas in which we will be paying careful consideration and attention- namely, copyright and the Freedom of Information Act (FOIA).

Works of Government employees are not subject to copyright protection because they are in the public domain. Software developed by a Government employee, therefore, is currently distributed on a no fee basis. There is not an incentive/reward system for the computer scientist/programmer to "market" software, in contrast to the patent licensing system that provides an incentive and reward for the inventor.