Financial Assistance for Research and Development, U.S.-Israeli Science and Technology Program

DEPARTMENT OF COMMERCE

Technology Administration

[Docket No. 941246-4346]

RIN 0693-AB37

Financial Assistance for Research and Development, U.S.-Israeli

Science and Technology Program

AGENCY: Technology Administration, Commerce.

ACTION: Notice of availability of funds.

-----------------------------------------------------------------------

SUMMARY: The Under Secretary for Technology of the United States

Department of Commerce announces the availability of financial

assistance under a pilot U.S.-Israeli Science and Technology Program

(the ``Program''). The Program will assist U.S.-based industrial firms

that have entered into U.S.-Israeli joint ventures (partnerships of

United States and Israeli companies) to carry out research and

development on long-term, medium- to high-risk technologies. This

Program is separate from the existing Bi-national Industrial R&D

Foundation (BIRD), which continues to offer support for commercial

joint ventures. Inquiries about BIRD assistance should be addressed

directly to the BIRD Foundation, Tel Aviv, Israel.

Such projects should focus on research, development and

commercialization of technologies that are not appropriately funded by

other U.S. or Israeli government-funded research and development

efforts. This assistance will take place through the use of cooperative

agreements with U.S.-based industrial firms pursuant to this Notice.

Funding will be made directly to the U.S. firms that are partners

in the U.S.-Israeli joint ventures. Funding from the U.S. Department of

Commerce for the pilot Program is limited to the U.S. partner(s) to a

U.S.-Israeli joint venture, with funding for the Israeli partner(s) to

be provided by the Israeli Government.

DATES: Applications must be received on or before January 20, 1995.

Preliminary applications (in the form of a Letter of Intent) to be

considered for a possible second round of awards, which is planned to

be conducted in the spring of 1995, may also be submitted during this

time period. This letter should provide the name, address, and phone

number of the principal point of contact for the anticipated proposal

and a brief (one paragraph) abstract of the proposal. Technical areas

to be covered by the proposal program should be summarized in the

abstract. It is expected that the review and selection process will

take approximately thirty (30) days.

ADDRESSES: Applications must be submitted to: U.S.-Israel Science and

Technology Commission, Room 7068, U.S. Department of Commerce,

Washington, D.C. 20230.

FOR FURTHER INFORMATION CONTACT: Lee Bailey, Executive Director, Office

of International Technology Policy, telephone number (202) 482-6351.

supplementary information: In March, 1993, President Clinton and

Israeli Prime Minister Yitzhak Rabin announced their intention to

create the U.S.-Israeli Science and Technology Commission (the

``Commission'') to promote U.S.-Israeli cooperative science and

technology activities that could benefit the two nations' civilian high

technology commercial sectors, and create jobs and economic growth.

Funding is intended for projects (1) that will have significant

economic benefits for both the United States and Israel and (2) that in

general are in the areas of the environment, energy, health,

biotechnology, information processing/telecommunications or

agriculture, or in the commercialization of defense technologies.

This program announcement has been determined to be not significant

for purposes of Executive Order 12866.

Authority--The Under Secretary for Technology, pursuant to the

authority delegated to her by Section 3706 of Title 15 of the U.S.

Code, as well as Secs. 2.02 and 4.03(d) of Department Organization

Order 10-17, dated July 14, 1992, is implementing this activity.

Program Description--The Program will assist eligible U.S.-based

industrial firms that have entered into U.S.-Israeli joint ventures

(partnerships of United States-based and Israeli-based companies) to

carry out research and development of long-term, medium- to high-risk

technologies that offer significant economic benefits, that are focused

on commercialization and that are not appropriately funded by other

U.S. and Israeli government-funded research and development efforts.

This assistance will take place through the use of cooperative

agreements. U.S. Commerce Department assistance is offered to promote

the economy of the U.S. via the creation of new technologies and the

commercialization of new and existing technologies.

Funding Availability--The U.S. Government and the Government of

Israel are each making available up to $5 million for this pilot

Program for qualified projects. It is expected that a number of awards

will be announced before the end of February 1995. Within the limits of

available funding, there is no predetermined minimum or maximum award.

The funds may be spent toward research and development activities

consistent with the goals set forth in this Notice.

Matching Funding Requirements--Federal financial assistance must be

accompanied by at least an equal matching investment by the U.S.-based

firm(s) party to each U.S.-Israeli joint venture. In the event there

are multiple U.S.-based firms in a given U.S.-Israeli joint venture,

the aggregate investment of the U.S. partners must at least equally

match the Federal investment in that project.

Eligibility Requirements--The Program will accept proposals only

from U.S.-Israeli joint ventures led by one U.S.-based industrial

partner and one Israeli-based industrial partner. In general, awards

will not be made to a joint venture composed of affiliated U.S.- and

Israeli-based partners. Concerns are considered to be affiliates of

each other when either directly or indirectly (a) one concern controls

or has the power to control the other, or (b) a third party or parties

controls or has the power to control both, or (c) an identity of

interest between or among parties exists such that affiliation may be

found.

Federal financial assistance will be given only to U.S.-based

industrial partner or to a consortia led by U.S.-based industrial

partners. A U.S.-based industrial partner, or a consortia led by U.S.-

based industrial partners, shall be eligible to receive assistance

under this Program only if the U.S.-based industrial partner, or each

member of the consortia, is incorporated in the United States and has

its principal place of business in the United States.

Project Eligibility

Proposed projects must meet the following criteria:

Must be in one of the following areas: the environment,

energy, health, biotechnology, information processing/

telecommunications, the commercialization of defense technologies, or

agriculture. Further, the project must be for research and development

activities in long term, medium- to high-risk technologies, and which

show a plan to commercialization within 48 months.

Must include technical innovation, significant commercial

potential, and economic benefit to both countries.

Award Period--The duration of Federal financial assistance to a

U.S.-based industrial firm will not exceed four years.

Indirect Costs--Indirect costs will not be funded under this

Program.

Application Forms and Kit--Applicants must submit one (1) signed

original plus two copies of each application. Standard Forms 424 and

424A, Application for Federal Assistance (which have been approved by

OMB Control No. 0348-0043 and 0348-0044, respectively) shall be used in

applying for financial assistance, plus such additional information as

is needed to permit the evaluation of the applications on the criteria

set forth below. This information includes but is not limited to:

Background information on the participating companies;

Technological and commercial objectives of the project;

Relationships of the project to each company's business

and development strategy;

Description of the project and technology involved;

Plans for commercialization, within 48 months;

Adherence of the project and/or technology to the

Commission's priority guidelines;

Proposed time schedule;

Provisions for the protection of intellectual property;

and

Commercialization and technological benefits.

Evaluation Criteria--Factors within each criteria (labelled i, ii,

iii, etc.) will be weighed equally. No project will be funded in the

absence of a finding of technical and commercial merit by the

reviewers. The evaluation criteria to be used in selecting any proposal

for funding under this program, and their respective weights, are:

(1) Scientific and Technical Merit of the Proposal (20 percent).

(i) Quality and innovativeness of the proposed technical program

(i.e. uniqueness with respect to current industry practice).

(ii) Technical feasibility of the project (i.e., are the technical

objectives realistic?).

(iii) Coherency of technical plan and clarity of vision of

technical objectives.

(iv) Breadth of impact of accomplishment of technical objectives.

(2) Commercial Benefits of the Proposal (25 percent).

(i) Commercial potential of the technology in the proposed venture.

(ii) Potential to improve U.S. Israeli economic growth and the

productivity of a broad spectrum of industrial sectors or businesses

within an economically important single sector.

(iii) Timeliness of proposal (i.e. the project results will not

occur too late to be competitively useful in the marketplace).

(3) Commercialization Plans for the Project (15 percent).

(i) Evidence that the participants will pursue commercial

application of the technology including production and distribution

plans.

(ii) Project plan adequately addresses technology transfer and

ownership requirements to assure prompt and widespread use and

protection of results by participants and, as appropriate, others.

(4) Qualifications of the Proposing Organization(s) (20 percent).

(i) Quality and appropriateness of proposer's commercial and

managerial staffing, facilities, equipment, and other resources to

accomplish the proposed program objectives.

(ii) Quality and appropriateness of the technical staff to carry

out the proposed work program and to identify and overcome technical

barriers to meeting project objectives.

(iii) For proposals involving laboratory prototype development,

evidence of availability of adequate design and manufacturing tools

appropriate to the prototype.

(5) Proposer's Level of Commitment and Organizational Structure (20

percent).

(i) Appropriateness of the structure of the proposed organization

in terms of composition of participants (i.e. vertical and/or

horizontal integration) and existing relationships among the parties.

(ii) Level of commitment of proposers as demonstrated by

contribution of personnel, equipment, facilities, and matching funds.

(iii) Appropriate participation by U.S. small business.

(iv) Evidence of a strong commitment by applicants to complete and,

if appropriate, provide support for continuation of the program beyond

the period of funding.

Selection Procedures.--The selection process for awards is

a multi-step process based on the criteria listed above.

In the first step, called the ``preliminary screening,''

representatives from both governments (hereinafter the ``Joint Panel'')

will review the applications and will eliminate those that do not meet

the threshold Eligibility Requirements listed above. Further

disqualifications will be made if the application is deemed to have

serious deficiencies in the technical and/or business plan, if the

application does not fall within the overall scope of the Program, or

if the application is more appropriately funded by other U.S. or

Israeli government-funded research and development efforts.

In the second step, referred to as the ``technical and

business review,'' applications are evaluated under the preceding

Evaluation Criteria. Applications are rated as ``not recommended'' or

``recommended.'' Applications must have high scientific and technical

merit to be recommended. Only those applications rated as

``recommended'' are considered further. Such applications are referred

to as ``semifinalists.'' If a majority of either country's

representatives rate an application as ``not recommended,'' that

application will be disqualified.

In the third step, referred to as ``selection of

finalists,'' the Joint Panel will prepare a final scoring and ranking

of recommended semifinalist applications, based upon evaluative

criteria. A list of ranked finalists is then submitted to each

respective nation's Selection Official.

In the final step, referred to as the ``selection of

awardees,'' the Selection Officials select funding recipients from

among the finalists, based upon the rank order of the applications on

the basis of all Evaluation Criteria (see above), assuring appropriate

distribution of funds among technologies, activities and recipients,

the availability of funds, and upon a determination as to the

responsibility of the applicant. The decision of the Selection

Officials is final. Applicants not chosen will be notified.

In the event that a U.S.-Israeli joint venture is ranked

as a finalist, but is determined to contain weaknesses in its structure

or cohesiveness that may substantially lesson the likelihood of the

proposed project's success, the applicant may be informed of the

deficiencies and negotiations may be entered into with the applicant in

an effort to remedy the deficiencies. If appropriate, funding up to 10%

of the amount originally requested by the applicant may be awarded by

the Program to the applicant to assist in overcoming the organizational

deficiencies, or in the conduct of feasibility studies. If the Program

determines within six months that the organizational deficiencies have

been corrected, the Program may award over the life of the project the

remaining funds requested by that applicant to that applicant.

The Program reserves the right to negotiate with

applicants selected to received awards over the cost and scope of the

proposed project, e.g., to add or delete a task in order to improve the

probability of success.

Funding Logistics--Funding will be made directly to the U.S.-based

firm(s) that is/are party to the U.S.-Israel joint venture.

Rights to Inventions--The provisions of the Bayh-Dole Act (35

U.S.C. Sec. 201, et seq., concerning patent rights in inventions made

with Federal assistance) and the Government Patent Policy set forth in

President Reagan's memorandum to the heads of Executive Departments and

Agencies, dated February 18, 1983, shall apply to all Federally-funded

research and development activities performed under this Program.

Other Requirements--

(1) Federal Policies and Procedures--Recipients and subrecipients

are subject to all Federal laws and Federal and Department of Commerce

policies, regulations, and procedures applicable to Federal financial

assistance awards.

(2) Past Performance--Unsatisfactory performance under prior

Federal awards may result in an application not being considered for

funding.

(3) Preaward Activities--If applicants incur any costs prior to an

award being made they do so solely at their own risk of not being

reimbursed by the U.S. Government. Notwithstanding any verbal or

written assurance that may have been received, there is no obligation

on the part of the Department of Commerce to cover preaward costs.

(4) No Obligation for Future Funding--If an application is selected

for funding under the pilot Program, there is no obligation to provide

any additional future funding in connection with that award. Renewal of

an award to increase funding or extend the period of performance is at

the total discretion of the awarding entities. An annual review of each

award will be conducted to determine the worthiness of continued or

additional future funding.

(5) Delinquent Federal Debts--No award of Federal funds shall be

made to an applicant who has an outstanding delinquent Federal debt

until either:

i. The delinquent account is paid in full,

ii. A negotiated repayment schedule is established and at least one

payment is received, or

iii. Other arrangements satisfactory to the Department of Commerce

are made.

(6) Name Check Review. All applicants are subject to a name check

review process. Name checks are intended to reveal if any key

individuals associated with the applicant have been convicted of or are

presently facing criminal charges such as fraud, theft, perjury, or

other matters which significantly reflect on the applicant's management

honesty or financial integrity.

(7) Primary Applicant Certifications. All primary applicants must

submit a completed Form CD-511, ``Certifications Regarding Debarment,

Suspension and Other Responsibility Matters; Drug-Free Workplace

Requirements and Lobbying,'' and the following explanations are hereby

provided:

i. Nonprocurement Debarment and Suspension. Prospective

participants (as defined at 15 CFR Part 26, Section 105) are subject to

15 CFR Part 26 ``Nonprocurement Debarment and Suspension'' and the

related section of the certification form prescribed above applies;

ii. Drug-Free Workplace. Funding recipients (as defined at 15 CFR

Part 26, Section 605) are subject to 15 CFR Part 26, Subpart F,

``Governmentwide Requirements for Drug-Free Workplace (Grants)'' and

the related section of the certification form prescribed above applies;

iii. Anti-Lobbying. Persons (as defined at 15 CFR Part 28, Section

105) are subject to the lobbying provisions of 31 U.S.C. 1352,

``Limitation on use of appropriated funds to influence certain Federal

contracting and financial transactions,'' and the lobbying section of

the certification form prescribed above applies to applications/bids

for grants, cooperative agreements, and contracts for more than

$100,000, and loans and loan guarantees for more than $150,000, or the

single family maximum mortgage limit for affected programs, whichever

is greater; and

iv. Anti-Lobbying Disclosures. Any applicant or component entity

thereof that has paid or will pay for lobbying using any funds must

submit an SF-LLL, ``Disclosure of Lobbying Activities,'' as required

under 15 CFR Part 28, Appendix B.

(8) Lower Tier Certifications. Recipients shall require applicants/

bidders for subgrants, contracts, subcontracts, or other lower tier

covered transactions at any tier under the award to submit, if

applicable, a completed Form CD-512, ``Certifications Regarding

Debarment, Suspension, Ineligibility and Voluntary Exclusion-Lower Tier

Covered Transactions and Lobbying'' and disclosure form, SF-LLL,

``Disclosure of Lobbying Activities.'' Form CD-512 is intended for the

use of recipients and should not be transmitted to the Department of

Commerce. SF-LLL submitted by any tier recipient or subrecipient should

be submitted to the Department of Commerce in accordance with the

instructions contained in the award document.

(9) False Statements. A false statement on an application is

grounds for denial or termination of funds and grounds for possible

punishment by a fine or imprisonment as provided in 18 U.S.C. 1001.

(10) Intergovernmental Review--Applications under this program are

not subject to Executive Order 12372, ``Intergovernmental Review of

Federal Programs.''

(11) Purchase of American-Made Equipment and Products--Applicants

are hereby notified that they will be encouraged, to the greatest

extent practicable, to purchase American-made equipment and products

with funding provided under this Program in accordance with

Congressional intent as set forth in the resolution contained in Public

Law 103-317, sections 607 (a)-(b).

(12) The implementation and conduct of this Program is contingent

upon the availability of all funding anticipated for its operation. The

Commerce Department reserves the right to discontinue this Program in

the event all funding is not made available or is otherwise not

secured.

Dated: December 9, 1994.

Mary Lowe Good,

Under Secretary of Commerce for Technology, U.S. Department of

Commerce.

[FR Doc. 94-31381 Filed 12-20-94; 8:45 am]

BILLING CODE 3510-18-M