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115th Congress } { Rept. 115-313
HOUSE OF REPRESENTATIVES
1st Session } { Part 1
======================================================================
SMALL BUSINESS INNOVATION RESEARCH AND SMALL BUSINESS TECHNOLOGY
TRANSFER IMPROVEMENTS ACT OF 2017
_______
September 14, 2017.--Committed to the Committee of the Whole House on
the State of the Union and and ordered to be printed
_______
Mr. Chabot, from the Committee on Small Business,
submitted the following
R E P O R T
[To accompany H.R. 2763]
[Including cost estimate of the Congressional Budget Office]
The Committee on Small Business, to whom was referred the
bill (H.R. 2763) to amend the Small Business Act to improve the
Small Business Innovation Research program and Small Business
Technology Transfer program, and for other purposes, having
considered the same, report favorably thereon with an amendment
and recommend that the bill as amended do pass.
CONTENTS
I. Amendment.......................................................2
II. Purpose and Bill Summary........................................7
III. Need for Legislation............................................8
IV. Hearings.......................................................13
V. Committee Consideration........................................14
VI. Committee Votes................................................15
VII. Section-by Section of H.R. 2763, As Amended....................27
VIII. Congressional Budget Office Cost Estimate......................29
IX. Unfunded Mandates..............................................31
X. New Budget Authority, Entitlement Authority, and Tax Expenditur31
XI. Oversight Findings.............................................32
XII. Statement of Constitutional Authority..........................32
XIII. Congressional Accountability Act...............................32
XIV. Federal Advisory Committee Act Statement.......................32
XV. Statement of No Earmarks.......................................32
XVI. Statement of Duplication of Federal Programs...................32
XVII. Disclosure of Directed Rule Makings............................32
XVIII.Performance Goals and Objectives...............................32
XIX. Changes in Existing Law, Made by the Bill, As Reported.........33
I. Amendment
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Small Business Innovation Research
and Small Business Technology Transfer Improvements Act of 2017''.
SEC. 2. REPORTING REQUIREMENTS.
(a) Annual Report To Congress.--Section 9(b)(7) of the Small
Business Act (15 U.S.C. 638(b)(7)) is amended by striking ``to report
not less than annually'' and inserting ``to submit a report not later
than December 31 of each year''.
(b) Annual Report to SBA and the Office of Science and Technology
Policy.--Section 9(g)(9) of the Small Business Act (15 U.S.C.
638(g)(9)) is amended--
(1) by striking ``make an annual report'' and inserting ``not
later than March 30 of each year, submit a report''; and /
(2) by striking ``and the Office of Science and Technology
Policy'' and inserting ``, the Office of Science and Technology
Policy, the Committee on Science, Space, and Technology and the
Committee on Small Business of the House of Representatives,
and the Committee on Small Business and Entrepreneurship of the
Senate''.
SEC. 3. REQUIRING INSERTION INCENTIVES.
Section 9(y)(5) of the Small Business Act (15 U.S.C. 638(y)(5)) is
amended by striking ``is authorized to'' and inserting ``shall''.
SEC. 4. SBIR PHASE FLEXIBILITY.
Section 9(cc) of the Small Business Act (15 U.S.C. 638(cc)) is
amended by striking ``During fiscal years'' and all that follows
through ``may each provide'' and inserting ``During fiscal years 2018
through 2022, all agencies participating in the SBIR program may
provide''.
SEC. 5. ESTABLISHING THE CIVILIAN AGENCY COMMERCIALIZATION READINESS
PROGRAM.
Section 9(gg) of the Small Business Act (15 U.S.C. 638(gg)) is
amended--
(1) by amending the subsection heading to read as follows:
``Civilian Agency Commercialization Readiness Program'';
(2) in paragraph (1), by inserting ``to establish a Civilian
Agency Commercialization Readiness Program for civilian
agencies'' after ``the covered Federal agency'';
(3) in paragraph (2)(A)--
(A) by striking ``establish a pilot program'' and
inserting ``establish a Civilian Agency
Commercialization Readiness Program under this
subsection''; and
(B) by striking ``the pilot program'' and inserting
``such Civilian Agency Commercialization Readiness
Program'';
(4) in paragraphs (3) and (4), by striking ``a pilot
program'' each place such term appears and inserting ``a
Civilian Commercialization Readiness Program'';
(5) in paragraph (6), by striking ``the pilot program'' and
inserting ``a Civilian Agency Commercialization Readiness
Program'';
(6) by striking paragraph (7) and redesignating paragraph (8)
as paragraph (7); and
(7) in paragraph (7) (as so redesignated), by amending
subparagraph (B) to read as follows:
``(B) the term `Civilian Agency Commercialization
Readiness Program' means each program established under
paragraph (1).''.
SEC. 6. EXTENSION OF DEADLINE FOR ASSISTANCE FOR ADMINISTRATIVE,
OVERSIGHT, AND CONTRACT PROCESSING COSTS.
Section 9(mm)(1) of the Small Business Act (15 U.S.C. 638(mm)(1))
is amended by striking ``September 30, 2017'' and inserting ``September
30, 2022''.
SEC. 7. INCREASED UNDERSERVED POPULATION PARTICIPATION WAIVER REMOVED.
(a) In General.--Section 9(mm)(2) of the Small Business Act (15
U.S.C. 638(mm)(2)) is amended to read as follows:
``(2) Outreach and Technical Assistance.--A Federal agency
participating in the program under this subsection shall use a
portion of the funds authorized for uses under paragraph (1) to
carry out the policy directive required under subsection
(j)(2)(F) and to increase the participation of States with
respect to which a low level of SBIR awards have historically
been awarded.''.
(b) Conforming Amendment.--Section 9(mm)(6) of the Small Business
Act (15 U.S.C. 638(mm)(6)) is amended by striking ``paragraph (2)(A)
and any use of the waiver authority under paragraph (2)(B)'' and
inserting ``paragraph (2)''.
SEC. 8. ANNUAL MEETING.
(a) In General.--Section 9 of the Small Business Act (15 U.S.C.
638) is amended by adding at the end the following new subsection:
``(tt) Annual Meeting.--
``(1) In general.--The head of each Federal agency required
to have a program under this section (or a designee) and the
Administrator (or a designee) shall meet annually to discuss
methods--
``(A) to improve the collection of data under this
section;
``(B) to improve the reporting of data to the
Administrator under this section;
``(C) to make the application processes for programs
under this section more efficient; and
``(D) to increase participation in the programs
established under this section.
``(2) Report.--Not later than 60 days after the date on which
an annual meeting required under paragraph (1) is held, the
Administrator shall submit to the Committee on Small Business
and Entrepreneurship of the Senate and the Committee on Small
Business and the Committee on Science, Space, and Technology of
the House of Representatives, a report on the findings of such
meeting and recommendations on how to implement changes to
programs under this section.''.
(b) Funding for Annual Meeting.--Section 9(mm)(1) of the Small
Business Act (15 U.S.C. 638(mm)(1)), as amended by this Act, is further
amended--
(1) in subparagraph (I), by striking the ``and'' at the end;
(2) in subparagraph (J), by striking the period at the end
and inserting ``; and''; and
(3) by adding at the end the following new subparagraph:
``(K) the annual meeting required under
subsection (tt).''.
SEC. 9. COMPLIANCE OF PHASE III AWARDS WITH COMPETITIVE PROCEDURES.
Section 9(r)(4) of the Small Business Act (15 U.S.C. 638(r)(4)) is
amended by striking ``, including sole source awards,'' and inserting
``as direct follow-on awards issued without further competition''.
SEC. 10. COMMERCIALIZATION ASSISTANCE PILOT PROGRAMS.
Section 9 of the Small Business Act (15 U.S.C. 638), as amended by
section 8, is further amended by adding at the end the following new
subsection:
``(uu) Commercialization Assistance Pilot Programs.--
``(1) Pilot programs implemented.--
``(A) In general.--Except as provided in subparagraph
(B), not later than one year after the date of the
enactment of this subsection, a covered agency shall
implement a commercialization assistance pilot program,
under which an eligible entity may receive a subsequent
Phase II SBIR award.
``(B) Exception.--If the Administrator determines
that a covered agency has a program that is
sufficiently similar to the commercialization
assistance pilot program established under this
subsection, such covered agency shall not be required
to implement a commercialization assistance pilot
program under this subsection.
``(2) Percent of agency funds.--The head of each covered
agency may allocate not more than 5 percent of the funds
allocated to the SBIR program of the covered agency for the
purpose of making a subsequent Phase II SBIR award under the
commercialization assistance pilot program.
``(3) Termination.--A commercialization assistance pilot
program established under this subsection shall terminate on
September 30, 2022.
``(4) Application.--To be selected to receive a subsequent
Phase II SBIR award under a commercialization assistance pilot
program, an eligible entity shall submit to the covered agency
implementing such pilot program an application at such time, in
such manner, and containing such information as the covered
agency may require, including--
``(A) an updated Phase II commercialization plan; and
``(B) the source and amount of the matching funding
required under paragraph (5).
``(5) Matching funding.--
``(A) In general.--The Administrator shall require,
as a condition of any subsequent Phase II SBIR award
made to an eligible entity under this subsection, that
a matching amount (excluding any fees collected by the
eligible entity receiving such award) equal to the
amount of such award be provided from an eligible
third-party investor.
``(B) Ineligible sources.--An eligible entity may not
use funding from ineligible sources to meet the
matching requirement of subparagraph (A).
``(6) Award.--A subsequent Phase II SBIR award made to an
eligible entity under this subsection--
``(A) may not exceed the limitation described under
subsection (aa)(1); and
``(B) shall be disbursed during Phase II.
``(7) Use of funds.--The funds awarded to an eligible entity
under this subsection may only be used for research and
development activities that build on eligible entity's Phase II
program and ensure the research funded under such Phase II is
rapidly progressing towards commercialization.
``(8) Selection.--In selecting eligible entities to
participate in a commercialization assistance pilot program
under this subsection, the head of a covered agency shall
consider--
``(A) the extent to which such award could aid the
eligible entity in commercializing the research funded
under the eligible entity's Phase II program;
``(B) whether the updated Phase II commercialization
plan submitted under paragraph (4) provides a sound
approach for establishing technical feasibility that
could lead to commercialization of such research;
``(C) whether the proposed activities to be conducted
under such updated Phase II commercialization plan
further improve the likelihood that such research will
provide societal benefits;
``(D) whether the small business concern has
progressed satisfactorily in Phase II to justify
receipt of a subsequent Phase II SBIR award;
``(E) the expectations of the eligible third-party
investor that provides matching funding under paragraph
(5); and
``(F) the likelihood that the proposed activities to
be conducted under such updated Phase II
commercialization plan using matching funding provided
by such eligible third-party investor will lead to
commercial and societal benefit.
``(9) Evaluation report.--Not later than 3 years after the
date of the enactment of this subsection, the Comptroller
General of the United States shall submit to the Committee on
Science, Space, and Technology and the Committee on Small
Business of the House of Representatives, and the Committee on
Small Business and Entrepreneurship of the Senate, a report
including--
``(A) a summary of the activities of
commercialization assistance pilot programs carried out
under this subsection;
``
(B) a detailed compilation of results achieved by such
commercialization assistance pilot programs, including the number of
eligible entities that received awards under such programs;
``(C) the rate at which each eligible entity that
received a subsequent Phase II SBIR award under this
subsection commercialized research of the recipient;
``(D) the growth in employment and revenue of
eligible entities that is attributable to participation
in a commercialization assistance pilot program;
``(E) a comparison of commercialization success of
eligible entities participating in a commercialization
assistance pilot program with recipients of an
additional Phase II SBIR award under subsection (ff);
``(F) demographic information, such as ethnicity and
geographic location, of eligible entities participating
in a commercialization assistance pilot program;
``(G) an accounting of the funds used at each covered
agency that implements a commercialization assistance
pilot program under this subsection;
``(H) the amount of matching funding provided by
eligible third-party in vestors, set forth separately
by source of funding;
``(I) an analysis of the effectiveness of the
commercialization assistance pilot program implemented
by each covered agency; and
``(J) recommendations for improvements to the
commercialization assistance pilot program.
``(10) Definitions.--For purposes of this subsection:
``(A) Covered agency.--The term `covered agency'
means a Federal agency required to have an SBIR
program.
``(B) Eligible entity.--The term `eligible entity'
means a small business concern that has received a
Phase II award under an SBIR program and an additional
Phase II SBIR award under subsection (ff) from the
covered agency to which such small business concern is
applying for a subsequent Phase II SBIR award.
``(C) Eligible third-party investor.--The term
`eligible third-party investor' means a small business
concern other than an eligible entity, a venture
capital firm, an individual investor, a non-SBIR
Federal, State or local government, or any combination
thereof.
``(D) Ineligible sources.--The term `ineligible
sources' means the following:
``(i) The eligible entity's internal research
and development funds.
``(ii) Funding in forms other than cash, such
as in-kind or other intangible assets.
``(iii) Funding from the owners of the
eligible entity, or the family members or
affiliates of such owners.
``(iv) Funding attained through loans or
other forms of debt obligations.
``(E) Subsequent phase ii SBIR award.--The term
`subsequent Phase II SBIR award' means an award granted
to an eligible entity under this subsection to carry
out further commercialization activities for research
conducted pursuant to an SBIR program.''.
SEC. 11. PROCUREMENT CENTER REPRESENTATIVES AND OTHER ACQUISITION
PERSONNEL IN THE SBIR AND STTR PROGRAMS.
(a) Definition of Senior Procurement Executive.--Section 9(e) of
the Small Business Act (15 U.S.C. 638(e)) is amended--
(1) in paragraph (12)(B), by striking ``and'' at the end;
(2) in paragraph (13)(B), by striking the period at the end
and inserting ``; and''; and
(3) by adding at the end the following new paragraph:
``(14) the term `senior procurement executive' means an
official designated under section 1702(c) of title 41, United
States Code, as the senior procurement executive of a Federal
agency participating in a SBIR or STTR program.''.
(b) Inclusion of Senior Procurement Executives in SBIR and STTR.--
(1) In general.--Section 9(b) of the Small Business Act (15
U.S.C. 638(b)) is amended--
(A) in paragraph (8), by striking ``and'' at the end;
(B) in paragraph (9), by striking the period at the
end and inserting ``; and''; and
(C) by adding at the end the following new paragraph:
``(10) to coordinate, where appropriate, with the senior
procurement executive of the relevant Federal agency to assist
small business concerns participating in a SBIR or STTR program
with commercializing research developed under such a program
before such small business concern is awarded a contract from
such Federal agency.''.
(2) Technical amendment.--Section 9(b)(3) of the Small
Business Act (15 U.S.C. 638(b)(3)) is amended by striking
``and'' at the end.
(c) Modifications Relating to Procurement Center Representatives
and Other Acquisition Personnel.--
(1) SBIR amendment.--Section 9(j) of the Small Business Act
(15 U.S.C. 638(j)) is amended by adding at the end the
following new paragraph:
``(4) Modifications relating to procurement center
representatives.--Upon the enactment of this paragraph, the
Administrator shall modify the policy directives issued
pursuant to this subsection to require procurement center
representatives (as described in section 15(l)) to assist small
business concerns participating in the SBIR program,
particularly in Phase III. The procurement center
representatives shall coordinate with the appropriate
contracting officer and the appropriate Director of the Office
of Small and Disadvantaged Business Utilization established
pursuant to section 15(k) for the agency letting the
contract.''.
(2) STTR amendment.--Section 9(p)(2) of the Small Business
Act (15 U.S.C. 638(p)(2)) is amended--
(A) in subparagraph (E)(ii), by striking ``and'' at
the end;
(B) in subparagraph (F), by striking the period at
the end and inserting ``; and''; and
(C) by adding at the end the following new
subparagraph:
``(G) procedures to ensure that procurement center
representatives (as described in section 15(l))--
``(i) assist small business concerns
participating in the STTR program, particularly
in Phase III; and
``(ii) coordinate with the appropriate
contracting officer and the ap- propriate
Director of the Office of Small and
Disadvantaged Business Utilization established
pursuant to section 15(k) for the Federal
agency letting the contract in providing the
assistance described in clause (i).''.
(d) Amendment to Duties of Procurement Center Representatives.--
Section 15(l)(2) of the Small Business Act (15 U.S.C. 644(l)(2)) is
amended--
(1) in subparagraph (I), by striking ``and'' at the end;
(2) by redesignating subparagraph (J) as subparagraph (L);
and
(3) by inserting after subparagraph (I) the following new
subparagraphs:
``(J) assist small business concerns participating in
a SBIR or STTR program under section 9 with Phase III;
``(K) coordinate with the appropriate contracting
officer and the appropriate Director of the Office of
Small and Disadvantaged Business Utilization
established pursuant to subsection (k) for the agency
letting the contract; and''.
(e) Amendment to the Duties of the Director of Small and
Disadvantaged Business Utilization for Federal Agencies.--Section 15(k)
of the Small Business Act (15 U.S.C. 644(k)) is amended--
(1) in paragraph (19), by striking ``and'' at the end;
(2) in paragraph (20), by striking the period at the end and
inserting a semicolon; and
(3) by adding at the end the following new paragraphs:
``(21) shall assist small business concerns participating in
a SBIR or STTR program under section 9 with researching
applicable solicitations for the award of a Federal contract
(particularly with the Federal agency that has a funding
agreement (as defined under section 9) with the concern) to
market the research developed by such concern under such SBIR
or STTR program; and
``(22) shall provide technical assistance to small business
concerns participating in a SBIR or STTR program under section
9 to submit a bid for an award of a Federal contract, including
coordination with procurement center representatives and the
appropriate senior procurement executive for the agency letting
the contract.''.
SEC. 12. IMPROVEMENTS TO TECHNICAL AND BUSINESS ASSISTANCE IN THE SBIR
AND STTR PROGRAMS.
Section 9(q) of the Small Business Act (15 U.S.C. 638(q)) is
amended--
(1) in the subsection heading, by inserting ``and Business''
after ``Technical'';
(2) in paragraph (1)--
(A) in the matter preceding subparagraph (A)--
(i) by striking ``a vendor selected under
paragraph (2)'' and inserting ``1 or more
vendors selected under paragraph (2)(A)'';
(ii) by inserting ``and business'' before
``assistance services''; and
(iii) by inserting ``assistance with product
sales, intellectual property protections,
market research, market validation, and
development of regulatory plans and
manufacturing plans,'' after ``technologies,'';
and
(B) in subparagraph (D), by inserting ``, including
intellectual property protections'' before the period
at the end;
(3) in paragraph (2)--
(A) by striking ``Each agency may select a vendor to
assist small business concerns to meet'' and inserting
the following:
``(A) In general.--Each agency may select 1 or more
vendors from which small business concerns may obtain
assistance in meeting''; and
(B) by adding at the end the following:
``(B) Selection by small business concern.--A small
business concern may, by contract or otherwise, select
1 or more vendors to assist the small business concern
in meeting the goals listed in paragraph (1).''; and
(4) in paragraph (3)--
(A) by inserting ``(A)'' after ``paragraph (2)'' each
place it appears;
(B) in subparagraph (A), by striking ``$5,000 per
year'' each place it appears and inserting ``$6,500 per
project'';
(C) in subparagraph (B)--
(i) by striking ``$5,000 per year'' each
place it appears and inserting ``$35,000 per
project''; and
(ii) in clause (ii), by striking ``which
shall be in addition to the amount of the
recipient's award'' and inserting ``which may,
as determined appropriate by the head of the
agency, be included as part of the recipient's
award or be in addition to the amount of the
recipient's award'';
(D) in subparagraph (C)--
(i) by inserting ``or business'' after
``technical'';
(ii) by striking ``the vendor'' and inserting
``a vendor''; and
(iii) by adding at the end the following:
``Business-related services aimed at improving
the commercialization success of a small
business concern may be obtained from an
entity, such as a public or private
organization or an agency of or other entity
established or funded by a State that
facilitates or accelerates the
commercialization of technologies or assists in
the creation and growth of private enterprises
that are commercializing technology.'';
(E) in subparagraph (D)--
(i) by inserting ``or business'' after
``technical'' each place it appears; and
(ii) in clause (i), by striking ``the
vendor'' and inserting ``1 or more vendors'';
and
(F) by adding at the end the following:
``(E) Multiple award recipients.--The Administrator
shall establish a limit on the amount of technical and
business assistance services that may be received or
purchased under subparagraph (B) by a small business
con- cern that has received multiple Phase II SBIR or
STTR awards for a fiscal year.''.
SEC. 13. ADDITIONAL SBIR AND STTR TECHNOLOGY INSERTION REPORTING
REQUIREMENT.
Section 9(y)(6) of the Small Business Act (15 U.S.C. 638(y)(6)) is
amended--
(1) in subparagraph (B), by striking ``and'' at the end;
(2) in subparagraph (C)(iii), by striking the period at the
end and inserting ``; and''; and
(3) by adding at the end the following new subparagraph:
``(D) not later than 120 days after the date of the
enactment of this subparagraph, and not later than
December 31 of each year thereafter, submit to the
Committee on Science, Space, and Technology and the
Committee on Small Business of the House of
Representatives, and to the Committee on Small Business
and Entrepreneurship of the Senate, a report describing
the goals set under subparagraph (A) and the incentives
used or created under subparagraph (B).''.
II. Purpose and Bill Summary
The purpose of H.R. 2763, the ``Small Business Innovation
Research and Small Business Technology Transfer Improvements
Act of 2017,'' is to amend the Small Business Act (the Act)\1\
to improve and modernize the Small Business Innovation Research
(SBIR) and Small Business Technology Transfer (STTR) programs.
The objectives of these programs include expansion of
commercialization of federally-funded small business research
and development (R&D;), stimulation of technological innovation
in the small business sector, and increased use of this
community to meet the government's diverse research and
development needs. H.R. 2763 strengthens the programs in five
ways.
---------------------------------------------------------------------------
\1\Originally, title II of the Act of July 30, 1953, c. 282, 67
Stat. 232, was designated as the Small Business Act of 1953. A plethora
of amendments in subsequent Congresses led to a rewrite in 1958. Pub.
L. No. 85-536, Sec. 1, 72 Stat. 384 (1958). The Act is codified at 15
U.S.C. Sec. Sec. 631-657s.
---------------------------------------------------------------------------
First, the bill insists on agency accountability, including
several hard reporting deadlines for participating agencies and
for the Small Business Administration (SBA) to provide future
Congresses with better information and a greater grasp of the
programs' strengths and weaknesses. Second, the legislation
clarifies congressional intent of the previous reauthorization
to ensure that taxpayers reap the benefits of the SBIR and STTR
programs by tying them to long term projects at the Department
of Defense (DOD). Third, the legislation extends a popular
pilot program included in the 2011 reauthorization that would
allow all participating agencies to award a Phase II contract
if the agency finds that the small business concern has already
completed work typically done during Phase I. Fourth, it makes
permanent the option for participating agencies to establish
Commercialization Readiness Programs (CRPs). As a pilot program
from the previous reauthorization, these CRPs have shown to
provide much needed assistance to small firms nearing the
completion of the process and have helped advance technology to
the commercialization phase. Fifth, it extends the provision to
allow participating agencies to utilize 3 percent of their
allocation for administrative functions, increase waste, fraud,
and abuse efforts, and conduct outreach in an effort to bring
more companies into the SBIR and STTR world.
III. Need for Legislation
H.R. 2763 was introduced by Congressman Steve Knight and
Congresswoman Stephanie Murphy on May 30, 2017, after
significant oversight of the SBIR and STTR programs by the
Committee extending several years. Prior to explaining the
necessary changes, a brief overview of each program will be
provided.
A. SBIR
Congressional support for the SBIR initiative was
predicated upon the belief that, while technology-based
companies under 500 employees tended to be highly innovative,
and innovation being essential to the economic well-being of
the United States, these businesses were underrepresented in
the awarding of government R&D; contracts. In order to increase
participation of such entities in federal R&D; efforts, Congress
passed the Small Business Innovation Development Act in
1982,\2\ which established the SBIR program. The purpose of the
Act was to increase government funding of small businesses that
conduct R&D; with a particular focus on technology that has high
commercial potential. Prior to the most recent reauthorization,
the SBIR program had been reauthorized and extended several
times. Each reauthorization made significant changes to the
SBIR program, including increasing award sizes for inflation,
codifying agency independence within a framework established by
the SBA, increasing the percentages of the extramural research
budgets that participating agencies must allocate for the
program, and increasing the general focus of the program on the
commercialization of the technologies developed.
---------------------------------------------------------------------------
\2\Pub. L. No. 97-219, 96 Stat. 217 (1982) (codified at 18 U.S.C.
Sec. 638).
---------------------------------------------------------------------------
The objectives of the SBIR program include expanded
commercialization of federally-funded R&D;, stimulation of
technological innovation in the small business sector,
increased use of this community to meet the government's
diverse R&D; needs, and additional involvement of minority and
disadvantaged individuals in the process.
The program requires each federal agency with an extramural
research budget of $100 million or more to allocate a small
percentage of its extramural budget for awards to small firms
for technology development. Currently, eleven agencies have
research budgets large enough to require participation in the
SBIR program: the Departments of Agriculture, Commerce,
Defense, Education, Energy, Health and Human Services, Homeland
Security, and Transportation; the Environmental Protection
Agency; the National Aeronautics and Space Administration; and
the National Science Foundation.
The percentage allocation was set initially at 1.25 percent
of participating agencies' extramural budgets. Congress has
increased the allocation percentage several times. For FY17 and
beyond, the percentage is 3.2 percent.
Each agency's SBIR activity reflects that organization's
management style. Individual departments select R&D; interests,
administer program operations, and control financial support.
Funding may be disbursed in the form of contracts, grants, or
cooperative agreements. Separate agencies issue solicitations
for R&D; at specific times and small businesses submit competing
proposals to do the work.
Congress delegated to the SBA the authority for creating
broad policy and guidelines under which qualifying agencies
operate their SBIR programs. The SBA monitors and reports to
Congress on the conduct of the separate departmental SBIR
activities. While the SBA provides direction and monitors the
program, it does not provide funding for the awards, select the
award winners, or distribute the award dollars.
Criteria for eligibility in the SBIR program includes
companies that are: independently owned and operated; not
dominant in the field of research proposed; for-profit; the
employer of 500 or fewer people; and at least 51 percent owned
by one or more United States citizens or lawfully-admitted
permanent resident aliens.
The SBIR program is designed to award grants via a three-
phase process. In the first phase, awards up to $150,000 are
provided to evaluate a concept's scientific or technical merit
and feasibility. The project must be of interest to and
coincide with the mission of the supporting organization.
Projects that demonstrate potential after the initial endeavor
may compete for Phase II awards of up to $1 million to perform
the principal R&D.; Phase III funding, directed at the
commercialization of the product or process, is expected to be
generated in the private sector. Federal dollars, but not SBIR
funds, may be used if the government perceives that the final
technology or technique will meet public needs.
B. STTR
STTR is another important small business technology
development program that also expands funding opportunities in
the federal innovation R&D; arena. Central to the program is
expansion of the public/private sector partnership to include
joint venture opportunities for small businesses and the
nation's network of nonprofit research institutions. Much like
SBIR, STTR is a highly competitive program that reserves a
specific percentage of federal R&D; funding for awards to small
businesses and nonprofit research institution partners.
The risk and expense of conducting sophisticated R&D;
efforts can be beyond the means of many small businesses,
especially those which have just initiated their businesses.
Conversely, nonprofit research laboratories are instrumental in
developing high-tech innovations, but these organizations
frequently confine themselves to theoretical, not practical,
applications. But frequently, innovation is confined to the
theoretical, not the practical. STTR combines the strengths of
both entities by introducing entrepreneurial skills to high-
tech research efforts. The technologies and products are then
transferred from the laboratory to the marketplace.
Eligibility criteria for businesses in STTR mirror those of
SBIR; they must be American-owned and independently operated;
for-profit; and employ no more than 500 workers. The nonprofit
research institution must also meet certain eligibility
criteria, such as being located in the United States and
meeting one of the three following definitions: it must be a
nonprofit college or university; a domestic nonprofit research
organization; or a federally-funded R&D; center.\3\
---------------------------------------------------------------------------
\3\Examples of each of these could be a major research university
such as the University of Pittsburgh, a non-profit research
organization such as the Cystic Fibrosis Foundation, or a federally
funded R&D; center such as the Los Alamos National Laboratory.
---------------------------------------------------------------------------
Each year, five federal departments and agencies are
required by STTR to reserve a portion (currently 0.45 percent)
of their R&D; funds for award to small business/nonprofit
research institution partnerships. Those are the Department of
Defense; the Department of Energy; the Department of Health and
Human Services; the National Aeronautics and Space
Administration; and the National Science Foundation.\4\ As with
SBIR, SBA develops broad guidelines but the agencies designate
R&D; topics, accept proposals, and award funds.
---------------------------------------------------------------------------
\4\Federal agencies with extramural R&D; budgets that exceed $1
billion are required to participate in the STTR program.
---------------------------------------------------------------------------
Similar to the SBIR program, agencies make STTR awards
based on small business/nonprofit research institution
qualification, degree of innovation, and future market
potential. Small businesses that receive awards then begin a
three-phase program. Phase I and II awards are capped at the
same levels as SBIR. The Phase III (commercialization) portion
of the project is designed to encourage private sector
investment or non-STTR or SBIR federal agency funding, which is
also similar to SBIR.
C. INDEPENDENT REVIEW OF SBIR AND STTR
In 2007, after more than three years of research and
analysis, the National Research Council (NRC) of the National
Academies of Science (NAS) released its assessment of the SBIR
program as administered by the five federal agencies (DOD,
National Institutes of Health, the National Aeronautics and
Space Administration, the Department of Energy, and the
National Science Foundation) that together made up
approximately 96 percent of SBIR program expenditures at that
time. The core finding of the study is that the SBIR program is
sound in concept and effective in practice.\5\ In support of
the report's core finding, the NRC concluded that the SBIR
program is: (1) stimulating technological innovations; (2)
increasing private sector commercialization of research; (3)
using small businesses to meet federal research and development
needs; and (4) providing widely distributed support for
innovation activity.\6\
---------------------------------------------------------------------------
\5\NRC, National Academies of Science, An Assessment of the Small
Business Innovation Research Program 3 (2007).
\6\Id. at 3-6.
---------------------------------------------------------------------------
To expand on this research and to provide greater
information to policymakers in the future, Congress directed\7\
the NRC to continue its examination of the SBIR program as well
as expand its review to include the STTR program. By and large,
the NRC found that the SBIR program is meeting most of its
statutory objectives. For instance, the NRC points out that
SBIR projects at the DOD commercialize at a substantial rate,
while the percentage of Phase II projects reporting sales
continues to be greater than 45 percent.\8\ The NRC also found
that the SBIR program at the National Institutes of Health is
having a positive overall impact and is meeting three of the
four legislative objectives of the program: stimulating
technical innovation, using small businesses to meet federal
R&D; needs, and increasing private-sector commercialization of
innovations derived from federal R&D.;\9\ Finally, the NRC found
that STTR is meeting its statutory objective of fostering
cooperation between small business concerns and research
institutions, and does so in some respects to an extent that
SBIR does not.\10\
---------------------------------------------------------------------------
\7\Pub. L. No. 112-81, Div. E., 125 Stat. 1850, 1822-62 (2011). The
short title of Division E is the SBIR/STTR Reauthorization Act of 2011.
\8\NRC, NAS, SBIR at the Department of Defense 201 (2014).
\9\NRC, NAS, SBIR/STTR at the National Institutes of Health 234
(2015).
\10\NRC, NAS, STTR: An Assessment of the Small Business Technology
Transfer Program 91 (2016).
---------------------------------------------------------------------------
As a result of Public Law 112-81, the Government
Accountability Office (GAO) conducted several investigations
constituting a comprehensive body of work to assess, among
other things, participating agency management, development, and
transitioning SBIR/STTR and STTR technologies across their
science and technology enterprises. By and large, the reports
pointed to a strong and vibrant program, with a few caveats.
For example, the GAO found that the SBA's ability to fully
determine compliance with spending requirements for the SBIR
and STTR programs is limited because most agencies submitted
incorrect data; GAO recommended that SBA should update its
guidance to require that adequate information be provided.\11\
---------------------------------------------------------------------------
\11\GAO, Small Business Research Programs: Challenges Remain in
Meeting Spending and Reporting Requirements (GAO-15-358) (Apr. 2015).
---------------------------------------------------------------------------
In the conference report to the National Defense
Authorization Act (NDAA) for Fiscal Year 2013, the conferees
directed the GAO to conduct a study to assess the DOD's
transition of technologies developed by small businesses
through the SBIR program, including: (1) an analysis of
technologies developed under the SBIR program and the extent to
which such technologies were incorporated into major weapon
systems or major automated information systems; (2) an analysis
of established or ad hoc procedures to allow program offices to
monitor, evaluate, and transition small business-developed
technologies into their programs; and (3) additional actions
that may be needed to improve DOD and the military services'
processes for monitoring, evaluating, and transitioning small
business-developed technologies for use in major weapon systems
or major automated information systems (including any
appropriate data collection and measures of effectiveness and
performance).\12\
---------------------------------------------------------------------------
\12\H.R. Conf. Rep. No. 112-705, at 942-943 (2012).
---------------------------------------------------------------------------
GAO released the report\13\ required by the FY 2013 NDAA on
December 20, 2013. GAO found that some common and branch-
specific transition initiatives, such as the Commercialization
Readiness Program and the Navy Transition Assistance Program,
help to improve small businesses' abilities to transition their
products to Phase III.\14\ While some programs are of
assistance, GAO recommended that DOD must improve tracking and
reporting of technology transition outcomes for SBIR projects
in order to improve transition rates. Specifically, the GAO
suggested that DOD: 1) establish a common definition of
technology transition for all SBIR projects to support annual
reporting requirements; 2) develop a plan to meet the new
technology reporting requirements that will improve the
completeness, quality, and reliability of SBIR transition data;
and 3) report to Congress on the Department's plan for meeting
the new SBIR reporting requirements, including specific steps
for improving the technology transition data.\15\
---------------------------------------------------------------------------
\13\GAO, Small Business Innovation Research: DOD'S Program Supports
Weapon Systems, but Lacks Comprehensive Data on Technology Transition
Outcomes (GAO-14-96) (2013).
\14\Id. at 6-7.
\15\Id. at 14-15.
---------------------------------------------------------------------------
D. NECESSARY REFORMS
The SBIR and STTR programs are currently authorized through
September 30, 2022.\16\ However, several popular pilot programs
and initiatives that were initiated in Public Law 112-81 expire
on September 30, 2017. Given the popularity of these programs
and the desire to provide certainty for the participating
agencies and the small firms who participate in the programs,
the House Committees on Small Business and Science, Space and
Technology have expressed interest in extending some of these
pilot programs and other popular provisions to coincide with
the September 30, 2022 authorization date.
---------------------------------------------------------------------------
\16\Pub. L. No. 114-328, Sec. 1834 (2016).
---------------------------------------------------------------------------
Each year, participating federal agencies are required to
submit to the SBA data on various aspects of their SBIR and
STTR programs, such as: reporting their total SBIR and STTR
allocation based on appropriated extramural research dollars;
the number and type of awards given, specific outreach
conducted to increase participation by underrepresented states
and populations; waste, fraud, and abuse efforts and, copious
other bits of information that allows the SBA, Congress, and
the public analyze the information. The SBA is then tasked with
coordinating these data submissions and compiling one annual
report that is published and provides a glimpse into the
programs' strengths and weaknesses. Unfortunately, the SBA is
currently 3 years in arrears in producing these reports.
Therefore, H.R. 2763 includes provisions that require agencies
to submit their annual reports to the SBA no later than March
30 of the following year. The SBA is additionally required to
produce their annual report for the previous year and submit it
to Congress no later than December 31 of each year. These clear
line standards replace more nebulous language in current statue
and provides agencies with hard deadlines that can be easily
noticed by Congress and industry if they are missed.
The legislation also extends three popular pilot programs
established by Public Law 112-81. First, it extends through
fiscal year 2022 the authority for participating agencies to
utilize 3 percent of the SBIR program for costs relating to
administrative, oversight, and contract processing activities
for SBIR programs, commercialization initiatives, technical
assistance initiatives, and outreach initiatives to raise
awareness of, and increase participation in the SBIR and STTR
programs. Recognizing that that the SBIR program is utilized by
11 different agencies with different needs, the Committee
supports the flexibility provided for the three percent program
and not further restricting how these funds may be spent.
The second pilot program that has been extended through
fiscal year 2022 is the initiative that allows participating
agencies to offer a straight to Phase II option for small firms
that have established they have completed the work
traditionally done in Phase I of the program. One of the
guiding principles the Committee has maintained through this
process is the need for the SBIR and STTR programs to be
focused on the commercialization phase of the process. This is
where small business often create the most jobs, generate the
most revenue, and contribute more to the economy, providing
taxpayers the biggest bang for their taxpayer buck. Moving
companies to Phase III of the process in a shortened time frame
(where appropriate) reinforces this tenant.
Maintaining the focus on the commercialization aspect of
the SBIR and STTR programs, the legislation also makes the
Commercialization Readiness Program at all civilian agencies a
permanent part of the SBIR program. Under this program,
agencies may use up to 10 percent of their program
authorization to grant post-phase II awards up to $3 million to
support advanced development of small business technologies.
This initiative helps especially promising technology bridge
the so-called ``valley of death'' that innovations often face
between completion of a project but before generating revenue
from that project. With a substantial investment made by
taxpayers already at this point in the process, the initiative
helps to ensure promising technology with commercial appeal is
not left on the lab floor due to lack of funding.
Finally, H.R. 2763 strengthens and clarifies congressional
intent of Public Law No. 112-81 by statutorily requiring the
Department of Defense to establish goals for transitioning
Phase III technologies in subcontracting plans for contracts of
$100 million or more. The provision also statutorily requires
the Secretary of Defense to set a goal to increase the number
of Phase II contracts that lead to technology insertion into
programs or record or fielded systems and to use incentives to
encourage agency program managers and prime contractors to meet
that goal.
IV. Hearings
In the 115th Congress, the Committee held one hearing that
looked at the issues covered by H.R. 2763. On May 4, 2017, the
Committee on Small Business Subcommittee on Contracting and
Workforce and the Committee on Science, Space, and Technology
Subcommittee on Research and Technology met for a joint hearing
titled, ``Improving the Small Business Innovation Research and
Small Business Technology Transfer Programs.'' Since the
Committee on Small Business and the Committee on Science,
Space, and Technology were interested in collaborating on
legislation making minor adjustments and improvements to the
programs in 2017, the joint hearing was carried out. Witnesses
included SBA officials, GAO officials, and several small firms
who participate in the SBIR and STTR programs and the topics of
discussion included the expansion of commercialization of
federally-funded small business research and development,
stimulation of technological innovation in the small business
sector, and increased use of this community to meet the
government's diverse research and development needs. Witnesses
also discussed potential improvements to help stimulate
commercialization rates, modify reporting requirements that
improve data collection, and ensure agencies are utilizing all
of the tools available to help transition SBIR and STTR
technology into larger contracts.
V. Committee Consideration
The Committee on Small Business met in open session, with a
quorum being present, on June 15, 2017 and ordered H.R. 2763
reported, as amended, to the House. During the markup, 5
amendments were offered. The amendments addressed below are in
the order in which they were considered at the markup.
An Amendment in the Nature of a Substitute (ANS was offered
by Chairman Chabot (R-OH) and Ranking Member Velazquez (D-NY).
The ANS did not change anything in the underlying bill;
however, it did add three sections at the end. The first
requires participating agencies to use part of their SBIR
allocation to conduct outreach to underrepresented states and
populations by removing the waiver of this requirement from the
statute. Under current law, the Administrator may waive this
outreach requirement should agencies certify that substantially
similar outreach is being conducted elsewhere in the program.
This provision deletes this waiver mandating that agencies
utilize a portion of their 3 percent administrative funding for
such outreach purposes. The second provision of the ANS
requires that the Administrator of the SBA (or a designee) and
the head of each participating agency (or a designee) meet
annually to discuss methods: to improve data collection; to
improve reporting of data; to make the application process more
streamlined; and to increase participation in the programs. The
provision also requires that the SBA submit a report to the
Committees of jurisdiction in both the House and Senate about
the topics discussed and resulting actions following the
discussion. Finally, the ANS clarifies Congressional intent
from Public Law No. 112-81 that Phase II awards have already
met all compliance for competitive procedures and may be direct
follow-on awards without further competition. Unanimous consent
was given by the Committee to have the text of the ANS be the
base text of H.R. 2763 for purposes of amendments.
Amendment Number One was offered by Mr. Lawson (D-FL). This
amendment requires the heads of all participating agencies to
implement a Commercialization Assistance Pilot Program, if not
currently operating such a similar program, within one year of
passage of the bill. The amendment passed by voice vote at
10:32 am.
Amendment Number Two was offered by Ms. Murphy (D-FL). The
amendment seeks to assist small business concerns in
commercializing their technology when obtaining government
contracts by directly incorporating acquisition personnel into
the SBIR and STTR programs, where appropriate. The amendment
passed by voice vote at 10:36 am.
Amendment Number Three was offered by Mr. Schneider (D-IL)
and Mr. Fitzpatrick (R-PA). The amendment will allow for
increased flexibility for use of funding within Phase I and II
of the SBIR and STTR programs. The amendment expands the list
of allowable expenses to include product sales, intellectual
property protections, market research, market validation and
development of regulatory plans and manufacturing plans. It
also increases the funding the SBIR and STTR Phase I and II
awardees may use for startup-related commercialization
activities. The Amendment passed by voice vote at 10:42 am.
Amendment Number Four was offered by Mr. Blum (R-IA) and
Mr. Espaillat (D-NY). This amendment stipulates that each
agency participating in the SBIR and STTR program is required
to submit their annual SBIR and STTR report to Congress as well
as to the SBA. Additionally, the amendment stipulates that the
Department of Defense report to Congress must include any goals
and inclusion incentives they devise to boost SBIR and STTR-
developed technologies into larger programs of record. The
amendment passed by voice vote at 10:49 am.
VI. Committee Votes
Clause 3(b) of rule XIII of the Rules of the House of
Representatives requires the Committee to list the recorded
votes on the motion to report legislation and amendments
thereto. The Committee voted 19-0 to report H.R. 2763, as
amended, to the House at 10:52 am.
AMENDMENT TO H.R. 2763 OFFERED BY MR. LAWSON OF FLORIDA
At the end of the bill, add the following new section:
SEC. 7. COMMERCIALIZATION ASSISTANCE PILOT PROGRAM.
Section 9 of the Small Business Act (15 U.S.C. 638) is
amended by adding at the end the following new subsection:
``(tt) Commercialization Assistance Pilot Programs.--
``(1) Pilot programs implemented.--
``(A) In general.--Except as provided in
subparagraph (B), not later than one year after
the date of the enactment of this subsection, a
covered agency shall implement a
commercialization assistance pilot program,
under which an eligible entity may receive a
subsequent Phase II SBIR award.
``(B) Exception.--If the Administrator
determines that a covered agency has a program
that is sufficiently similar to the
commercialization assistance pilot program
established under this subsection, such covered
agency shall not be required to implement a
commercialization assistance pilot program
under this subsection.
``(2) Percent of agency funds.--The head of each
covered agency may allocate not more than 5 percent of
the funds allocated to the SBIR program of the covered
agency for the purpose of making a subsequent Phase II
SBIR award under the commercialization assistance pilot
program.
``(3) Termination.--A commercialization assistance
pilot program established under this subsection shall
terminate on September 30, 2022.
``(4) Application.--To be selected to receive a
subsequent Phase II SBIR award under a
commercialization assistance pilot program, an eligible
entity shall submit to the covered agency implementing
such pilot program an application at such time, in such
manner, and containing such information as the covered
agency may require, including--
``(A) an updated Phase II commercialization
plan; and
``(B) the source and amount of the matching
funding required under paragraph (5).
``(5) Matching funding.--
``(A) In general.--The Administrator shall
require, as a condition of any subsequent Phase
II SBIR award made to an eligible entity under
this subsection, that a matching amount
(excluding any fees collected by the eligible
entity receiving such award) equal to the
amount of such award be provided from an
eligible third-party investor.
``(B) Ineligible sources.--An eligible entity
may not use funding from ineligible sources to
meet the matching requirement of subparagraph
(A).
``(6) Award.--A subsequent Phase II SBIR award made
to an eligible entity under this subsection--
``(A) may not exceed the limitation described
under subsection (aa)(1); and
``(B) shall be disbursed during Phase II.
``(7) Use of funds.--The funds awarded to an eligible
entity under this subsection may only be used for
research and development activities that build on
eligible entity's Phase II program and ensure the
research funded under such Phase II is rapidly
progressing towards commercialization.
``(8) Selection.--In selecting eligible entities to
participate in a commercialization assistance pilot
program under this subsection, the head of a covered
agency shall consider--
``(A) the extent to which such award could
aid the eligible entity in commercializing the
research funded under the eligible entity's
Phase II program;
``(B) whether the updated Phase II
commercialization plan submitted under
paragraph
(4) provides a sound approach for establishing technical
feasibility that could lead to commercialization of such
research;
``(C) whether the proposed activities to be
conducted under such updated Phase II
commercialization plan further improve the
likelihood that such research will provide
societal benefits;
``(D) whether the small business concern has
progressed satisfactorily in Phase II to
justify receipt of a subsequent Phase II SBIR
award;
``(E) the expectations of the eligible third-
party investor that provides matching funding
under paragraph (5); and
``(F) the likelihood that the proposed
activities to be conducted under such updated
Phase II commercialization plan using matching
funding provided by such eligible third-party
investor will lead to commercial and societal
benefit.
``(9) Evaluation report.--Not later than 3 years
after the date of the enactment of this subsection, the
Comptroller General of the United States shall submit
to the Committee on Science, Space, and Technology and
the Committee on Small Business of the House of
Representatives, and the Committee on Small Business
and Entrepreneurship of the Senate, a report
including--
``(A) a summary of the activities of
commercialization assistance pilot programs
carried out under this subsection;
``(B) a detailed compilation of results
achieved by such commercialization assistance
pilot programs, including the number of
eligible entities that received awards under
such programs;
``(C) the rate at which each eligible entity
that received a subsequent Phase II SBIR award
under this subsection commercialized research
of the recipient;
``(D) the growth in employment and revenue of
eligible entities that is attributable to
participation in a commercialization assistance
pilot program;
``(E) a comparison of commercialization
success of eligible entities participating in a
commercialization assistance pilot program with
recipients of an additional Phase II SBIR award
under subsection (ff);
``(F) demographic information, such as
ethnicity and geographic location, of eligible
entities participating in a commercialization
assistance pilot program;
``(G) an accounting of the funds used at each
covered agency that implements a
commercialization assistance pilot program
under this subsection;
``(H) the amount of matching funding provided
by eligible third-party investors, set forth
separately by source of funding;
``(I) an analysis of the effectiveness of the
commercialization assistance pilot program
implemented by each covered agency; and
``(J) recommendations for improvements to the
commercialization assistance pilot program.
``(10) Definitions.--For purposes of this subsection:
``(A) Covered agency.--The term `covered
agency' means a Federal agency required to have
an SBIR program.
``(B) Eligible entity.--The term `eligible
entity' means a small business concern that has
received a Phase II award under an SBIR program
and an additional Phase II SBIR award under
subsection
(ff) from the covered agency to which such small business
concern is applying for a subsequent Phase II SBIR award.
``(C) Eligible third-party investor.--The
term `eligible third-party investor' means a
small business concern other than an eligible
entity, a venture capital firm, an individual
investor, a non-SBIR Federal, State or local
government, or any combination thereof.
``(D) Ineligible sources.--The term
`ineligible sources' means the following:
``(i) The eligible entity's internal
research and development funds.
``(ii) Funding in forms other than
cash, such as in-kind or other
intangible assets.
``(iii) Funding from the owners of
the eligible entity, or the family
members or affiliates of such owners.
``(iv) Funding attained through loans
or other forms of debt obligations.
``(E) Subsequent phase ii sbir award.--The
term `subsequent Phase II SBIR award' means an
award granted to an eligible entity under this
subsection to carry out further
commercialization activities for research
conducted pursuant to an SBIR program.''.
----------
AMENDMENT TO H.R. 2763 OFFERED BY MRS. MURPHY OF FLORIDA
At the end of the bill, add the following new section:
SEC. 7. PROCUREMENT CENTER REPRESENTATIVES AND OTHER ACQUISITION
PERSONNEL IN THE SBIR AND STTR PROGRAMS.
(a) Definition of Senior Procurement Executive.--Section 9(e)
of the Small Business Act (15 U.S.C. 638(e)) is amended--
(1) in paragraph (12)(B), by striking ``and'' at the
end;
(2) in paragraph (13)(B), by striking the period at
the end and inserting ``; and''; and
(3) by adding at the end the following new paragraph:
``(13) the term `senior procurement executive' means
an official designated under section 1702(c) of title
41, United States Code, as the senior procurement
executive of a Federal agency participating in a SBIR
or STTR program.''.
(b) Inclusion of Senior Procurement Executives in SBIR and
STTR.--
(1) In general.--Section 9(b) of the Small Business
Act (15 U.S.C. 638(b)) is amended--
(A) in paragraph (8), by striking ``and'' at
the end;
(B) in paragraph (9), by striking the period
at the end and inserting ``; and''; and
(C) by adding at the end the following new
paragraph:
``(10) to coordinate, where appropriate, with the
senior procurement executive of the relevant Federal
agency to assist small business concerns participating
in a SBIR or STTR program with commercializing research
developed under such a program before such small
business concern is awarded a contract from such
Federal agency.''.
(2) Technical amendment.--Section 9(b)(3) of the
Small Business Act (15 U.S.C. 638(b)(3)) is amended by
striking ``and'' at the end.
(c) Modifications Relating to Procurement Center
Representatives and Other Acquisition Personnel.--
(1) SBIR amendment.--Section 9(j) of the Small
Business Act (15 U.S.C. 638(j)) is amended by adding at
the end the following new paragraph:
``(4) Modifications relating to procurement center
representatives.--Upon the enactment of this paragraph,
the Administrator shall modify the policy directives
issued pursuant to this subsection to require
procurement center representatives (as described in
section 15
(l)) to assist small business concerns participating in the
SBIR program with researching solicitations for the award of a
Federal contract (particularly with the Federal agency that has
a funding agreement with the concern) and to provide technical
assistance to such concerns to submit a bid for an award of a
Federal contract. The procurement center representatives shall
coordinate with the appropriate senior procurement executive
and the appropriate Director of the Office of Small and
Disadvantaged Business Utilization established pursuant to
section 15
(k) for the agency letting the contract.''.
(2) STTR amendment.--Section 9(p)(2) of the Small
Business Act (15 U.S.C. 638(p)(2)) is amended--
(A) in subparagraph (E)(ii), by striking
``and'' at the end;
(B) in subparagraph (F), by striking the
period at the end and inserting ``; and''; and
(C) by adding at the end the following new
subparagraph:
``(G) procedures to ensure that procurement
center representatives (as described in section
15(l))--
``(i) assist small business concerns
participating in the STTR program with
researching applicable solicitations
for the award of a Federal contract
(particularly with the Federal agency
that has a funding agreement with the
concern);
``(ii) provide technical assistance
to such concerns to submit a bid for an
award of a Federal contract; and
``(iii) coordinate with the
appropriate senior procurement
executive and the appropriate Director
of the Office of Small and
Disadvantaged Business Utilization
established pursuant to section 15(k)
for the Federal agency letting the
contract in providing the assistance
described in clause (i).''.
(d) Amendment to Duties of Procurement Center
Representatives.--Section 15(l)(2) of the Small Business Act
(15 U.S.C. 644(l)(2)) is amended--
(1) in subparagraph (I), by striking ``and'' at the
end;
(2) by redesignating subparagraph (J) as subparagraph
(L); and
(3) by inserting after subparagraph (I) the following
new subparagraphs:
``(J) assist small business concerns
participating in a SBIR or STTR program under
section 9 with researching applicable
solicitations for the award of a Federal
contract to market the research developed by
such concern under such SBIR or STTR program;
``(K) provide technical assistance to small
business concerns participating in a SBIR or
STTR program under section 9 to submit a bid
for an award of a Federal contract, including
coordination with the appropriate senior
procurement executive and the appropriate
Director of the Office of Small and
Disadvantaged Business Utilization established
pursuant to subsection (k) for the agency
letting the contract; and''.
(e) Amendment to the Duties of the Director of Small and
Disadvantaged Business Utilization for Federal Agencies.--
Section 15(k) of the Small Business Act (15 U.S.C. 644(k)) is
amended--
(1) in paragraph (19), by striking ``and'' at the
end;
(2) in paragraph (20), by striking the period at the
end and inserting a semicolon; and
(3) by adding at the end the following new
paragraphs:
``(21) shall assist small business concerns
participating in a SBIR or STTR program under section 9
with researching applicable solicitations for the award
of a Federal contract (particularly with the Federal
agency that has a funding agreement (as defined under
section 9) with the concern) to market the research
developed by such concern under such SBIR or STTR
program; and
``(22) shall provide technical assistance to small
business concerns participating in a SBIR or STTR
program under section 9 to submit a bid for an award of
a Federal contract, including coordination with
procurement center representatives and the appropriate
senior procurement executive for the agency letting the
contract.''.
----------
AMENDMENT TO H.R. 2763 OFFERED BY MR. SCHNEIDER OF ILLINOIS AND MR.
FITZPATRICK OF PENNSYLVANIA
At the end of the bill, add the following new section:
SEC. 7. IMPROVEMENTS TO TECHNICAL AND BUSINESS ASSISTANCE IN THE SBIR
AND STTR PROGRAMS.
Section 9(q) of the Small Business Act (15 U.S.C. 638(q)) is
amended--
(1) in the subsection heading, by inserting ``and
Business'' after ``Technical'';
(2) in paragraph (1)--
(A) in the matter preceding subparagraph
(A)--
(i) by striking ``a vendor selected
under paragraph (2)'' and inserting ``1
or more vendors selected under
paragraph (2)(A)'';
(ii) by inserting ``and business''
before ``assistance services''; and
(iii) by inserting ``assistance with
product sales, intellectual property
protections, market research, market
validation, and development of
regulatory plans and manufacturing
plans,'' after ``technologies,''; and
(B) in subparagraph (D), by inserting ``,
including intellectual property protections''
before the period at the end;
(3) in paragraph (2)--
(A) by striking ``Each agency may select a
vendor to assist small business concerns to
meet'' and inserting the following:
``(A) In general.--Each agency may select 1
or more vendors from which small business
concerns may obtain assistance in meeting'';
and
(B) by adding at the end the following:
``(B) Selection by small business concern.--A
small business concern may, by contract or
otherwise, select 1 or more vendors to assist
the small business concern in meeting the goals
listed in paragraph (1).''; and
(4) in paragraph (3)--
(A) by inserting ``(A)'' after ``paragraph
(2)'' each place it appears;
(B) in subparagraph (A), by striking ``$5,000
per year'' each place it appears and inserting
``$6,500 per project'';
(C) in subparagraph (B)--
(i) by striking ``$5,000 per year''
each place it appears and inserting
``$35,000 per project''; and
(ii) in clause (ii), by striking
``which shall be in addition to the
amount of the recipient's award'' and
inserting ``which may, as determined
appropriate by the head of the agency,
be included as part of the recipient's
award or be in addition to the amount
of the recipient's award'';
(D) in subparagraph (C)--
(i) by inserting ``or business''
after ``technical'';
(ii) by striking ``the vendor'' and
inserting ``a vendor''; and
(iii) by adding at the end the
following: ``Business-related services
aimed at improving the
commercialization success of a small
business concern may be obtained from
an entity, such as a public or private
organization or an agency of or other
entity established or funded by a State
that facilitates or accelerates the
commercialization of technologies or
assists in the creation and growth of
private enterprises that are
commercializing technology.'';
(E) in subparagraph (D)--
(i) by inserting ``or business''
after ``technical'' each place it
appears; and
(ii) in clause (i), by striking ``the
vendor'' and inserting ``1 or more
vendors''; and
(F) by adding at the end the following:
``(E) Multiple award recipients.--The
Administrator shall establish a limit on the
amount of technical and business assistance
services that may be received or purchased
under subparagraph
(B) by a small business concern that has received multiple
Phase II SBIR or STTR awards for a fiscal year.''.
----------
AMENDMENT TO H.R. 2763 OFFERED BY MR. BLUM OF IOWA, FOR HIMSELF AND MR.
ESPAILLAT OF NEW YORK
Subsection
(b) of section 2 is amended to read as follows:
(b) Annual Report to SBA and the Office of Science and
Technology Policy.--Section 9(g)(9) of the Small Business Act
(15 U.S.C. 638(g)(9)) is amended--
(1) by striking ``make an annual report'' and
inserting ``not later than March 30 of each year,
submit a report''; and
(2) by striking ``and the Office of Science and
Technology Policy'' and inserting ``, the Office of
Science and Technology Policy, the Committee on
Science, Space, and Technology and the Committee on
Small Business of the House of Representatives, and the
Committee on Small Business and Entrepreneurship of the
Senate''.
At the end of the bill, add the following new section:
SEC. 7. ADDITIONAL SBIR AND STTR TECHNOLOGY INSERTION REPORTING
REQUIREMENT.
Section 9(y)(6) of the Small Business Act (15 U.S.C.
638(y)(6)) is amended--
(1) in subparagraph (B), by striking ``and'' at the
end;
(2) in subparagraph (C)(3), by striking the period at
the end and inserting ``; and''; and
(3) by adding at the end the following new
subparagraph:
``(D) not later than 120 days after the date
of the enactment of this subparagraph, and not
later than December 31 of each year thereafter,
submit to the Committee on Science, Space, and
Technology and the Committee on Small Business
of the House of Representatives, and to the
Committee on Small Business and
Entrepreneurship of the Senate, a report
describing the goals set under subparagraph (A)
and the incentives used or created under
subparagraph (B).''.
VII. Section-by-Section of H.R. 2763, As Amended
Section 1. Short title
This section designates the bill as the ``Small Business
Innovation Research and Small Business Technology Transfer
Improvements Act of 2017.''
Section 2. Reporting requirements
This section requires the Small Business Administration
(SBA) to file its annual report on the SBIR and STTR programs
to Congress by December 31 of each calendar year. The section
also requires each of the participating agencies to submit all
of the required reports and information to the SBA by March 31
of each year.
Section. 3. Requirements for insertion incentives
This section clarifies Congressional intent from the 2011
reauthorization by ensuring the Department of Defense
establishes goals and insertion incentives for the transition
of Phase III technology in subcontracting plans for any
contracts with a value of $100 million or more.
Section. 4. SBIR Phase flexibility
This section extends through FY2022 the pilot program
instituted at in the 2011 reauthorization (Public Law No. 112-
81, 5106) that allows three agencies (Department of Defense,
the National Institutes of Health, and the Department of
Education) to award a Phase II contract if the agency finds
that the small business concern has already completed work
typically done during Phase I. This section also extends this
flexibility to all participating agencies.
Section 5. Establishing the civilian agency Commercialization Readiness
Program
This section makes permanent a pilot program established in
the 2011 reauthorization (Public Law No. 112-81, 5123) that
authorizes all civilian agencies to create Commercialization
Readiness Programs (CRPs) by allocating no more than 10 percent
of their program authorization to maximize advanced development
of small business technologies which are facing high
manufacturing or regulatory costs.
Section 6. Extension of the deadline for assistance for administrative,
oversight, and contract processing costs
This section extends through FY2022 the pilot program
established in the 2011 reauthorization (Public Law No. 112-
815141) authorizing agencies to utilize up to three percent of
the allocations under the SBIR program for various
administrative functions associated with operation of the SBIR
and STTR programs.
Section 7. Increased underserved population participation waiver
removed
This section requires participating agencies to use part of
their SBIR allocation to conduct outreach to underrepresented
states and populations by removing the waiver of this
requirement from the statute.
Section 8. Annual meeting
This section requires an annual summit of participating
agencies so they will be able to discuss best practices to
improve their ability to collect data and streamline processes
of the SBIR and STTR programs.
Section 9. Compliance of Phase III awards with competitive procedures
This section ensures that Phase III awards are deemed to be
in compliance with competitive procedures as they are given as
follow-on awards.
Section 10. Commercialization Assistance Pilot Programs
This section requires the heads of all participating
agencies to implement a Commercialization Assistance Pilot
Program, if not currently operating such a similar program,
within one year of passage of the bill.
Section 11. Procurement center representatives and other acquisition
personnel in the SBIR and STTR programs
The section seeks to assist small business concerns in
commercializing their technology when obtaining government
contracts by directly incorporating acquisition personnel into
the SBIR and STTR programs, where appropriate.
Section 12. Improvements to technical and business assistance in the
SBIR and STTR programs
This section allows for increased flexibility for use of
funding within Phase I and II of the SBIR and STTR programs.
The amendment expands the list of allowable expenses to include
product sales, intellectual property protections, market
research, market validation and development of regulatory plans
and manufacturing plans. It also increases the funding the SBIR
and STTR Phase I and II awardees may use for startup-related
commercialization activities.
Section 13. Additional SBIR and STTR technology insertion reporting
requirement
This section, within 120 days after enactment, that the
Department of Defense report to Congress any goals and
inclusion incentives they devise to boost SBIR and STTR-
developed technologies into larger programs of record.
VIII. Congressional Budget Office Cost Estimate
The Congressional Budget Office submitted a cost estimate
for H.R. 2763 that stated enacting the legislation would not
increase net direct spending or on-budget deficits in any of
the four consecutive periods beginning in 2028.
U.S. Congress,
Congressional Budget Office,
Washington, DC, September 7, 2017.
Hon. Steve Chabot,
Chairman, Committee on Small Business,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 2763, the Small
Business Innovation Research and Small Business Technology
Transfer Improvements Act of 2017.
If you wish further details on this estimate, we will be
pleased to provide them. The CB staff contact is Stephen
Rabent.
Sincerely,
Keith Hall.
Enclosure.
H.R. 2763--Small Business Innovation Research and Small Business
Technology Transfer Improvements Act of 2017
H.R. 2763 would make several changes to the operations of
the Small Business Innovation Research (SBIR) and Small
Business Technology Transfer (STTR) programs. Based on an
analysis of information from the Small Business Administration
(SBA) and participating agencies, CBO estimates that
implementing the bill would cost $24 million over the 2018-2022
period; such spending would be subject to the availability of
appropriated funds.
Under current law, the SBIR program requires federal
agencies with extramural budgets for research and development
(R&D;) that exceed $100 million per year to set aside 3.2
percent of that budget for contracts with small businesses.
(Extramural budgets consist of expenditures for activities not
performed by agency employees.) Likewise, the STTR program
requires federal agencies with extramural budgets for R&D; that
exceed $1 billion per year to set aside 0.45 percent of that
budget for cooperative research between small businesses and a
federal laboratory or nonprofit research institution. Eleven
agencies currently participate in at least one of those
programs. Under current law, a pilot program authorizes
participating agencies to use up to 3 percent of the R&D;
amounts set aside for the SBIR program to cover the costs of
certain authorized activities in administrating the SBIR and
STTR programs rather than paying those costs from general
operating funds. That authorization will expire at the end of
fiscal year 2017.
H.R. 2763 would extend that pilot program through fiscal
year 2022. Because the pilot program would not affect the
underlying costs of administering the SBIR or STIR programs,
CBO estimates that extending the pilot program would have no
budgetary effect.
H.R. 2763 also would require participating agencies to
create a new pilot program to allocate up to 5 percent of their
SBIR funding for awards to move technologies toward
commercialization if the SBA determines that agencies do not
already operate a similar program. The Government
Accountability Office (GAO) would be required to develop a
report on the results of the program after three years and
recommendations for improvements. Based on an analysis of
information from the SBA and several participating agencies,
CBO estimates that implementing the provisions would cost $5
million over the 2018-2022 period for agencies to develop a new
pilot program or to adapt current programs to comply with
requirements of the bill; such spending would be subject to the
availability of appropriated funds. Based on the costs of
similar reports, CBO estimates that any increased costs to GAO
to create the report would be insignificant.
Finally, H.R. 2763 would expand the duties of procurement
center representatives at the SBA and Offices of Small and
Disadvantaged Business Utilization (OSDBU) at participating
agencies to include providing technical assistance to small
businesses participating in SBIR and STTR programs. Based on an
analysis of information from the SBA and participating
agencies, CBO estimates that implementing those changes would
cost $19 million over the 2018-2022 period for participating
agencies to each hire three additional employees to assist
small businesses in the SBIR and STTR programs and to
coordinate with the SBA; such spending also would be subject to
appropriation of the necessary amounts.
Pay-as-you-go procedures do not apply to this legislation
because it would not affect direct spending or revenues.
CBO estimates that enacting H.R. 2763 would not increase
net direct spending or on-budget deficits in any of the four
consecutive 10-year periods beginning in 2028.
H.R. 2763 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act and
would not affect the budgets of state, local, or tribal
governments
On August 17, 2017, CBO transmitted a cost estimate for
H.R. 2763, the Small Business Innovation Research and Small
Business Technology Transfer Improvements Act of 2017, as
ordered reported by the House Committee on Science, Space and
Technology on June 22, 2017. That version of the bill did not
include provisions that directed agencies participating in the
SBIR program to develop a new pilot program, expanded the
duties of employees at the SBA and at Offices of Small and
Disadvantaged Business Utilization, and required agencies and
the SBA to meet annually and for the SBA to develop an annual
report. That version of the bill also contained a provision
that required agencies participating in the STTR program to
develop a new grant program which is not in this version. CBO's
cost estimates for the two versions of the bill reflect those
differences.
The CBO staff contact for this estimate is Stephen Rabent.
The estimate was approved by Theresa Gullo, Assistant Director
for Budget Analysis.
IX. Unfunded Mandates
H.R. 2763 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act, Public
Law No. 104-4, and would impose no costs on state, local, or
tribal governments.
X. New Budget Authority, Entitlement Authority, and Tax Expenditures
In compliance with clause 3(c)(2) of rule XIII of the Rules
of the House, the Committee provides the following opinion and
estimate with respect to new budget authority, entitlement
authority, and tax expenditures. While the Committee has not
received an estimate of new budget authority contained in the
cost estimate prepared by the Director of the Congressional
Budget Office pursuant to 402 of the Congressional Budget Act
of 1974, the Committee does not believe that there will be any
additional costs attributable to this legislation. H.R. 2763
does not direct new spending, but instead reallocates funding
independently authorized and appropriated.
XI. Oversight Findings
In accordance with clause 2(b)(1) of Rule X of the Rules of
the House, the oversight findings and recommendations of the
Committee on Small Business with respect to the subject matter
contained in H.R. 2763 are incorporated into the descriptive
portions of this report.
XII. Statement of Constitutional Authority
Pursuant to clause 3(d)(1) of Rule XIII of the Rules of the
House, the Committee finds that the authority for this
legislation in Art. I, 8, cl. 2; Art. I, 8, cl. 7; and, Art. I,
8 cl. 12.
XIII. Congressional Accountability Act
H.R. 2763 does not relate to the terms and conditions of
employment or access to public services or accommodations
within the meaning of 102(b)(3) of Public Law No. 104-1.
XIV. Federal Advisory Committee Act Statement
H.R. 2763 does not establish or authorize the establishment
of any new advisory committees as that term is defined in the
Federal Advisory Committee Act, 5 U.S.C. App. 2.
XV. Statement of No Earmarks
Pursuant to clause 9 of rule XXI, H.R. 2763 does not
contain any congressional earmarks, limited tax benefits, or
limited tariff benefits as defined in subsections (d), e, or
(f) of clause 9 of rule XXI of the Rules of the House.
XVI. Statement of Duplication of Federal Programs
Pursuant to clause 3(c) of the Rule XIII of the Rules of
the House, no provision of H.R. 2763 establishes or
reauthorizes a program of the federal government known to be
duplicative of another federal program, a program that was
included in any report from the United States Government
Accountability Office pursuant to 21 of Pub. L. No. 111-139, or
a program related to a program identified in the most recent
catalog of federal domestic assistance.
XVII. Disclosure of Directed Rule Makings
Pursuant to clause 3(c) of Rule XIII of the Rules of the
House, H.R. 2763 does not direct any rulemaking.
XVIII. Performance Goals and Objectives
Pursuant to clause 3(c)(4) of rule XIII of the Rules of the
House, the Committee establishes the following performance-
related goals and objectives for this legislation:
H.R. 2763 includes a number of provisions designed to
improve the opportunities for small business concerns
to compete for federal research and development
contracts and grants pursuant to the Small Business Act
and to improve agency compliance with the Small
Business Act.
XIX. Changes in Existing Law
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause e of rule XIII of the Rules of
the House, changes in existing law made by the bill, as
reported, as shown as follows existing law proposed to be
omitted is enclosed in black brackets, new matter is printed in
italic, and existing law in which no change is proposed is
shown in roman:
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, and existing law in which no
change is proposed is shown in roman):
SMALL BUSINESS ACT
* * * * * * *
Sec. 9. (a) Research and development are major factors in the
growth and progress of industry and the national economy. The
expense of carrying on research and development programs is
beyond the means of many small-business concerns, and such
concerns are handicapped in obtaining the benefits of research
and development programs conducted at Government expense. These
small-business concerns are thereby placed at a competitive
disadvantage. This weakens the competitive free enterprise
system and prevents the orderly development of the national
economy. It is the policy of the Congress that assistance be
given to small-business concerns to enable them to undertake
and to obtain the benefits of research and development in order
to maintain and strengthen the competitive free enterprise
system and the national economy.
(b) It shall be the duty of the Administration, and it is
hereby empowered--
(1) to assist small-business concerns to obtain
Government contracts for research and development;
(2) to assist small-business concerns to obtain the
benefits of research and development performed under
Government contracts or at Government expense;
(3) to provide technical assistance to small-business
concerns to accomplish the purposes of this section;
[and]
(4) to develop and maintain a source file and an
information program to assure each qualified and
interested small business concern the opportunity to
participate in Federal agency small business innovation
research programs and small business technology
transfer programs;
(5) to coordinate with participating agencies a
schedule for release of SBIR and STTR solicitations,
and to prepare a master release schedule so as to
maximize small business' opportunities to respond to
solicitations;
(6) to independently survey and monitor the operation
of SBIR and STTR programs within participating Federal
agencies;
(7) [to report not less than annually] to submit a
report not later than December 31 of each year to the
Committee on Small Business of the Senate, and to the
Committee on Science and the Committee on Small
Business of the House of Representatives, on the SBIR
and STTR programs of the Federal agencies and the
Administration's information and monitoring efforts
related to the SBIR and STTR programs, including--
(A) the data on output and outcomes collected
pursuant to subsections (g)(8) and (o)(9);
(B) the number of proposals received from,
and the number and total amount of awards to,
HUBZone small business concerns and firms with
venture capital, hedge fund, or private equity
firm investment (including those majority-owned
by multiple venture capital operating
companies, hedge funds, or private equity
firms) under each of the SBIR and STTR
programs;
(C) a description of the extent to which each
Federal agency is increasing outreach and
awards to firms owned and controlled by women
or by socially or economically disadvantaged
individuals under each of the SBIR and STTR
programs;
(D) general information about the
implementation of, and compliance with the
allocation of funds required under, subsection
(dd) for firms owned in majority part by
venture capital operating companies, hedge
funds, or private equity firms and
participating in the SBIR program;
(E) a detailed description of appeals of
Phase III awards and notices of noncompliance
with the SBIR Policy Directive and the STTR
Policy Directive filed by the Administrator
with Federal agencies;
(F) an accounting of funds, initiatives, and
outcomes under the Commercialization Readiness
Program; and
(G) a descriptionof the extent to which
Federal agencies are providing in a timely
manner information needed to maintain the
database described in subsection (k);
(8) to provide for and fully implement the tenets of
Executive Order No. 13329 (Encouraging Innovation in
Manufacturing); [and]
(9) to coordinate the implementation of electronic
databases at each of the Federal agencies participating
in the SBIR program or the STTR program, including the
technical ability of the participating agencies to
electronically share data[.]; and
(10) to coordinate, where appropriate, with the
senior procurement executive of the relevant Federal
agency to assist small business concerns participating
in a SBIR or STTR program with commercializing research
developed under such a program before such small
business concern is awarded a contract from such
Federal agency.
(c) The Administration is authorized to consult and cooperate
with all Government agencies and to make studies and
recommendations to such agencies, and such agencies are
authorized and directed to cooperate with the Administration in
order to carry out and to accomplish the purposes of this
section.
(d)(1) The Administrator is authorized to consult with
representatives of small-business concerns with a view to
assisting and encouraging such firms to undertake joint
programs for research and development carried out through such
corporate or other mechanism as may be most appropriate for the
purpose. Such joint programs may, among other things, include
the following purposes:
(A) to construct, acquire, or establish laboratories
and other facilities for the conduct of research;
(B) to undertake and utilize applied research;
(C) to collect research information related to a
particular industry and disseminate it to participating
members;
(D) to conduct applied research on a protected,
proprietary, and contractual basis with member or
nonmember firms, Government agencies, and others;
(E) to prosecute applications for patents and render
patent services for participating members; and
(F) to negotiate and grant licenses under patents
held under the point program, and to establish
corporations designed to exploit particular patents
obtained by it.
(2) The Administrator may, after consultation with the
Attorney General and the Chairman of the Federal Trade
Commission, and with the prior written approval of the Attorney
General, approve any agreement between small-business firms
providing for a joint program of research and development, if
the Administrator finds that the joint program proposed will
maintain and strengthen the free enterprise system and the
economy of the Nation. The Administrator or the Attorney
General may at any time withdraw his approval of the agreement
and the joint program of research and development covered
thereby, if he finds that the agreement or the joint program
carried on under it is no longer in the best interests of the
competitive free enterprise system and the economy of the
Nation. A copy of the statement of any such finding and
approval intended to be within the coverage of this subsection,
and a copy of any modification or withdrawal of approval, shall
be published in the Federal Register. The authority conferred
by this subsection on the Administrator shall not be delegated
by him.
(3) No act or omission to act pursuant to and within the
scope of any joint program for research and development, under
an agreement approved by the Administrator under this
subsection, shall be construed to be within the prohibitions of
the antitrust laws or the Federal Trade Commission Act. Upon
publication in the Federal Register of the notice of withdrawal
of his approval of the agreement granted under this subsection,
either by the Administrator or by the Attorney General, the
provisions of this subsection shall not apply to any subsequent
act or omission to act by reason of such agreement or approval.
(e) For the purpose of this section--
(1) the term ``extramural budget'' means the sum of
the total obligations minus amounts obligated for such
activities by employees of the agency in or through
Government-owned, Government-operated facilities,
except that for the Agency for International
Development it shall not include amounts obligated
solely for general institutional support of
international research centers or for grants to foreign
countries, and except that for the Department of Energy
it shall not include amounts obligated for atomic
energy defense programs for weapons and weapons-related
activities or for naval reactor programs;
(2) the term ``Federal agency'' means an executive
agency as defined in section 105 of title 5, United
States Code, or a military department as defined in
section 102 of such title, except that it does not
include any agency within the Intelligence Community
(as the term is defined in section 3.4(f) of Executive
Order 12333 or its successor orders);
(3) the term ``funding agreement'' means any
contract, grant, or cooperative agreement entered into
between any Federal agency and any small business for
the performance of experimental, developmental, or
research work funded in whole or in part by the Federal
Government;
(4) the term ``Small Business Innovation Research
Program'' or ``SBIR'' means a program under which a
portion of a Federal agency's research or research and
development effort is reserved for award to small
business concerns through a uniform process having--
(A) a first phase for determining, insofar as
possible, the scientific and technical merit
and feasibility of ideas that appear to have
commercial potential, as described in
subparagraph (B), submitted pursuant to SBIR
program solicitations;
(B) a second phase, which shall not include
any invitation, pre-screening, or pre-selection
process for eligibility for Phase II, that will
further develop proposals which meet particular
program needs, in which awards shall be made
based on the scientific and technical merit and
feasibility of the proposals, as evidenced by
the first phase, considering, among other
things, the proposal's commercial potential, as
evidenced by--
(i) the small business concern's
record of successfully commercializing
SBIR or other research;
(ii) the existence of second phase
funding commitments from private sector
or non-SBIR funding sources;
(iii) the existence of third phase,
follow-on commitments for the subject
of the research; and
(iv) the presence of other indicators
of the commercial potential of the
idea; and
(C) where appropriate, a third phase for work
that derives from, extends, or completes
efforts made under prior funding agreements
under the SBIR program--
(i) in which commercial applications
of SBIR-funded research or research and
development are funded by non-Federal
sources of capital or, for products or
services intended for use by the
Federal Government, by follow-on non-
SBIR Federal funding awards; or
(ii) for which awards from non-SBIR
Federal funding sources are used for
the continuation of research or
research and development that has been
competitively selected using peer
review or merit-based selection
procedures;
(5) the term ``research'' or ``research and
development'' means any activity which is (A) a
systematic, intensive study directed toward greater
knowledge or understanding of the subject studied; (B)
a systematic study directed specifically toward
applying new knowledge to meet a recognized need; or
(C) a systematic application of knowledge toward the
production of useful materials, devices, and systems or
methods, including design, development, and improvement
of prototypes and new processes to meet specific
requirements;
(6) the term ``Small Business Technology Transfer
Program'' or ``STTR'' means a program under which a
portion of a Federal agency's extramural research or
research and development effort is reserved for award
to small business concerns for cooperative research and
development through a uniform process having--
(A) a first phase, to determine, to the
extent possible, the scientific, technical, and
commercial merit and feasibility of ideas
submitted pursuant to STTR program
solicitations;
(B) a second phase, which shall not include
any invitation, pre-screening, or pre-selection
process for eligibility for Phase II, that will
further develop proposals that meet particular
program needs, in which awards shall be made
based on the scientific, technical, and
commercial merit and feasibility of the idea,
as evidenced by the first phase and by other
relevant information; and
(C) where appropriate, a third phase for work
that derives from, extends, or completes
efforts made under prior funding agreements
under the STTR program--
(i) in which commercial applications
of STTR-funded research or research and
development are funded by non-Federal
sources of capital or, for products or
services intended for use by the
Federal Government, by follow-on non-
STTR Federal funding awards; and
(ii) for which awards from non-STTR
Federal funding sources are used for
the continuation of research or
research and development that has been
competitively selected using peer
review or scientific review criteria;
(7) the term ``cooperative research and development''
means research or research and development conducted
jointly by a small business concern and a research
institution in which not less than 40 percent of the
work is performed by the small business concern, and
not less than 30 percent of the work is performed by
the research institution;
(8) the term ``research institution'' means a
nonprofit institution, as defined in section 4(5) of
the Stevenson-Wydler Technology Innovation Act of 1980,
and includes federally funded research and development
centers, as identified by the National Scientific
Foundation in accordance with the governmentwide
Federal Acquisition Regulation issued in accordance
with section 35(c)(1) of the Office of Federal
Procurement Policy Act (or any successor regulation
thereto);
(9) the term ``commercial applications'' shall not be
construed to exclude testing and evaluation of
products, services, or technologies for use in
technical or weapons systems, and further, awards for
testing and evaluation of products, services, or
technologies for use in technical or weapons systems
may be made in either Phase II or Phase III of the
Small Business Innovation Research Program and of the
Small Business Technology Transfer Program, as defined
in this subsection;
(10) the term ``commercialization'' means--
(A) the process of developing products,
processes, technologies, or services; and
(B) the production and delivery (whether by
the originating party or by others) of
products, processes, technologies, or services
for sale to or use by the Federal Government or
commercial markets;
(11) the term ``Phase I'' means--
(A) with respect to the SBIR program, the
first phase described in paragraph (4)(A); and
(B) with respect to the STTR program, the
first phase described in paragraph (6)(A);
(12) the term ``Phase II'' means--
(A) with respect to the SBIR program, the
second phase described in paragraph (4)(B); and
(B) with respect to the STTR program, the
second phase described in paragraph (6)(B);
[and]
(13) the term ``Phase III'' means--
(A) with respect to the SBIR program, the
third phase described in paragraph (4)(C); and
(B) with respect to the STTR program, the
third phase described in paragraph (6)(C)[.];
and
(14) the term ``senior procurement executive'' means
an official designated under section 1702(c) of title
41, United States Code, as the senior procurement
executive of a Federal agency participating in a SBIR
or STTR program.
(f) Federal Agency Expenditures for the SBIR Program.--
(1) Required expenditure amounts.--Except as provided
in paragraph (2)(B), each Federal agency which has an
extramural budget for research or research and
development in excess of $100,000,000 for fiscal year
1992, or any fiscal year thereafter, shall expend with
small business concerns--
(A) not less than 1.5 percent of such budget
in each of fiscal years 1993 and 1994;
(B) not less than 2.0 percent of such budget
in each of fiscal years 1995 and 1996;
(C) not less than 2.5 percent of such budget
in each of fiscal years 1997 through 2011;
(D) not less than 2.6 percent of such budget
in fiscal year 2012;
(E) not less than 2.7 percent of such budget
in fiscal year 2013;
(F) not less than 2.8 percent of such budget
in fiscal year 2014;
(G) not less than 2.9 percent of such budget
in fiscal year 2015;
(H) not less than 3.0 percent of such budget
in fiscal year 2016; and
(I) not less than 3.2 percent of such budget
in fiscal year 2017 and each fiscal year
thereafter,
specifically in connection with SBIR programs which
meet the requirements of this section, policy
directives, and regulations issued under this section.
(2) Limitations.--A Federal agency shall not--
(A) use any of its SBIR budget established
pursuant to paragraph (1) for the purpose of
funding administrative costs of the program,
including costs associated with salaries and
expenses; or
(B) make available for the purpose of meeting
the requirements of paragraph (1) an amount of
its extramural budget for basic research which
exceeds the percentages specified in paragraph
(1).
(3) Exclusion of certain funding agreements.--Funding
agreements with small business concerns for research or
research and development which result from competitive
or single source selections other than an SBIR program
shall not be considered to meet any portion of the
percentage requirements of paragraph (1).
(4) Rule of construction.--Nothing in this subsection
may be construed to prohibit a Federal agency from
expending with small business concerns an amount of the
extramural budget for research or research and
development of the agency that exceeds the amount
required under paragraph (1).
(g) Each Federal agency required by subsection (f) to
establish a small business innovation research program shall,
in accordance with this Act and regulations issued hereunder--
(1) unilaterally determine categories of projects to
be in its SBIR program;
(2) issue small business innovation research
solicitations in accordance with a schedule determined
cooperatively with the Small Business Administration;
(3) unilaterally determine research topics within the
agency's SBIR solicitations, giving special
consideration to broad research topics and to topics
that further 1 or more critical technologies, as
identified by--
(A) the National Critical Technologies Panel
(or its successor) in the 1991 report required
under section 603 of the National Science and
Technology Policy, Organization, and Priorities
Act of 1976, and in subsequent reports issued
under that authority; or
(B) the Secretary of Defense, in the 1992
report issued in accordance with section 2522
of title 10, United States Code, and in
subsequent reports issued under that authority;
(4)(A) unilaterally receive and evaluate proposals
resulting from SBIR proposals; and
(B) make a final decision on each proposal submitted
under the SBIR program--
(i) not later than 1 year after the date on
which the applicable solicitation closes, if
with respect to the National Institutes of
Health or the National Science Foundation, or
90 days after the date on which the applicable
solicitation closes, if with respect to any
other participating agency; or
(ii) if the Administrator authorizes an
extension with respect to a solicitation, not
later than 90 days after the date that would
otherwise be applicable to the agency under
clause (i);
(5) subject to subsection (l), unilaterally select
awardees for the SBIR funding agreements and inform
each awardee under such an agreement, to the extent
possible, of the expenses of the awardee that will be
allowable under the funding agreement;
(6) administer its own SBIR funding agreements (or
delegate such administration to another agency);
(7) make payments to recipients of SBIR funding
agreements on the basis of progress toward or
completion of the funding agreement requirements and,
in all cases, make payment to recipients under such
agreements in full, subject to audit, on or before the
last day of the 12-month period beginning on the date
of completion of such requirements;
(8) collect annually, and maintain in a common format
in accordance with the simplified reporting
requirements under subsection (v), such information
from awardees as is necessary to assess the SBIR
program, including information necessary to maintain
the database described in subsection (k), including--
(A) whether an awardee--
(i) has venture capital, hedge fund,
or private equity firm investment or is
majority-owned by multiple venture
capital operating companies, hedge
funds, or private equity firms and, if
so--
(I) the amount of venture
capital, hedge fund, or private
equity firm investment that the
awardee has received as of the
date of the award; and
(II) the amount of additional
capital that the awardee has
invested in the SBIR
technology;
(ii) has an investor that--
(I) is an individual who is
not a citizen of the United
States or a lawful permanent
resident of the United States
and, if so, the name of any
such individual; or
(II) is a person that is not
an individual and is not
organized under the laws of a
State or the United States and,
if so, the name of any such
person;
(iii) is owned by a woman or has a
woman as a principal investigator;
(iv) is owned by a socially or
economically disadvantaged individual
or has a socially or economically
disadvantaged individual as a principal
investigator;
(v) is a faculty member or a student
of an institution of higher education,
as that term is defined in section 101
of the Higher Education Act of 1965 (20
U.S.C. 1001); or
(vi) is located in a State described
in subsection (u)(3);
(B) a justification statement from the
agency, if an awardee receives an award in an
amount that is more than the award guidelines
under this section; and
(C) data with respect to the Federal and
State Technology Partnership Program (FAST
Program);
(9) [make an annual report] not later than March 30
of each year, submit a report on the SBIR program to
the Small Business Administration [and the Office of
Science and Technology Policy], the Office of Science
and Technology Policy, the Committee on Science, Space,
and Technology and the Committee on Small Business of
the House of Representatives, and the Committee on
Small Business and Entrepreneurship of the Senate;
(10) include, as part of its annual performance plan
as required by subsections (a) and (b) of section 1115
of title 31, United States Code, a section on its SBIR
program, and shall submit such section to the Committee
on Small Business of the Senate, and the Committee on
Science and the Committee on Small Business of the
House of Representatives;
(11) provide for and fully implement the tenets of
Executive Order No. 13329 (Encouraging Innovation in
Manufacturing); and
(12) provide timely notice to the Administrator of
any case or controversy before any Federal judicial or
administrative tribunal concerning the SBIR program of
the Federal agency.
(h) In addition to the requirements of subsection (f), each
Federal agency which has a budget for research or research and
development in excess of $20,000,000 for any fiscal year
beginning with fiscal year 1983 or subsequent fiscal year shall
establish goals specifically for funding agreements for
research or research and development to small business
concerns, and no goal established under this subsection shall
be less than the percentage of the agency's research or
research and development budget expended under funding
agreements with small business concerns in the immediately
preceding fiscal year.
(i) Annual Reporting.--
(1) In general.--Each Federal agency required by this
section to have an SBIR program or to establish goals
shall report annually to the Small Business
Administration the number of awards (including awards
under subsection (y)) pursuant to grants, contracts, or
cooperative agreements over $10,000 in amount and the
dollar value of all such awards, identifying SBIR
awards and comparing the number and amount of such
awards with awards to other than small business
concerns.
(2) Calculation of extramural budget.--
(A) Methodology.--Not later than 4 months
after the date of the enactment of each
appropriations Act for a Federal agency
required by this section to have an SBIR
program, the Federal agency shall submit to the
Administrator a report, which shall include a
description of the methodology used for
calculating the amount of the extramural budget
of that Federal agency.
(B) Administrator's analysis.--The
Administrator shall include an analysis of the
methodology received from each Federal agency
referred to in subparagraph (A) in the report
required by subsection (b)(7).
(j)(1) Policy directives.--The Small Business Administration,
after consultation with the Administrator of the Office of
Federal Procurement Policy, the Director of the Office of
Science and Technology Policy, and the Intergovernmental
Affairs Division of the Office of Management and Budget, shall,
within one hundred and twenty days of the enactment of the
Small Business Innovation Development Act of 1982, issue policy
directives for the general conduct of the SBIR programs within
the Federal Government, including providing for--
(A) simplified, standardized, and timely SBIR
solicitations;
(B) a simplified, standardized funding process which
provides for (i) the timely receipt and review of
proposals; (ii) outside peer review for at least Phase
II proposals, if appropriate; (iii) protection of
proprietary information provided in proposals; (iv)
selection of awardees; (v) retention of rights in data
generated in the performance of the contract by the
small business concern; (vi) transfer of title to
property provided by the agency to the small business
concern if such a transfer would be more cost effective
than recovery of the property by the agency; (vii) cost
sharing; and (viii) cost principles and payment
schedules;
(C) exemptions from the regulations under paragraph
(2) if national security or intelligence functions
clearly would be jeopardized;
(D) minimizing regulatory burden associated with
participation in the SBIR program for the small
business concern which will stimulate the cost-
effective conduct of Federal research and development
and the likelihood of commercialization of the results
of research and development conducted under the SBIR
program;
(E) simplified, standardized, and timely annual
report on the SBIR program to the Small Business
Administration and the Office of Science and Technology
Policy;
(F) standardized and orderly withdrawal from program
participation by an agency having a SBIR program; at
the discretion of the Administration, such directives
may require a phased withdrawal over a period of time
sufficient in duration to minimize any adverse impact
on small business concerns; and
(G) the voluntary participation in a SBIR program by
a Federal agency not required to establish such a
program pursuant to subsection (f).
(2) Modifications.--Not later than 90 days after the
date of enactment of the Small Business Research and
Development Enhancement Act of 1992, the Administrator
shall modify the policy directives issued pursuant to
this subsection to provide for--
(A) retention by a small business concern of
the rights to data generated by the concern in
the performance of an SBIR award for a period
of not less than 4 years;
(B) continued use by a small business concern
participating in Phase III of the SBIR program,
as a directed bailment, of any property
transferred by a Federal agency to the small
business concern in Phase II of an SBIR program
for a period of not less than 2 years,
beginning on the initial date of the concern's
participation in Phase III of such program;
(C) procedures to ensure, to the extent
practicable, that an agency which intends to
pursue research, development, or production of
a technology developed by a small business
concern under an SBIR program enters into
follow-on, non-SBIR funding agreements with the
small business concern for such research,
development, or production;
(D) an increase to $150,000 in the amount of
funds which an agency may award in Phase I of
an SBIR program, and to $1,000,000 in Phase II
of an SBIR program, and an adjustment of such
amounts every year for inflation;
(E) a process for notifying the participating
SBIR agencies and potential SBIR participants
of the 1991, 1992, and the current critical
technologies, as identified--
(i) by the National Critical
Technologies Panel (or its successor),
in accordance with section 603 of the
National Science and Technology Policy,
Organization, and Priorities Act of
1976; or
(ii) by the Secretary of Defense, in
accordance with section 2522 of title
10, United States Code;
(F) enhanced outreach efforts to increase the
participation of socially and economically
disadvantaged small business concerns, as
defined in section 8(a)(4), and the
participation of small businesses that are 51
percent owned and controlled by women in
technological innovation and in SBIR programs,
including Phase III of such programs, and the
collection of data to document such
participation;
(G) technical and programmatic guidance to
encourage agencies to develop gap-funding
programs to address the delay between an award
for Phase I of an SBIR program and the
application for and extension of an award for
Phase II of such program;
(H) procedures to ensure that a small
business concern that submits a proposal for a
funding agreement for Phase I of an SBIR
program and that has received more than 15
Phase II SBIR awards during the preceding 5
fiscal years is able to demonstrate the extent
to which it was able to secure Phase III
funding to develop concepts resulting from
previous Phase II SBIR awards; and
(I) procedures to ensure that agencies
participating in the SBIR program retain the
information submitted under subparagraph (H) at
least until the General Accounting Office
submits the report required under section 105
of the Small Business Research and Development
Enhancement Act of 1992.
(3) Additional modifications.--Not later than 120
days after the date of the enactment of the Small
Business Innovation Research Program Reauthorization
Act of 2000, the Administrator shall modify the policy
directives issued pursuant to this subsection--
(A) to clarify that the rights provided for
under paragraph (2)(A) apply to all Federal
funding awards under this section, including
Phase I, Phase II, and Phase III;
(B) to provide for the requirement of a
succinct commercialization plan with each
application for a Phase II award that is moving
toward commercialization;
(C) to require agencies to report to the
Administration, not less frequently than
annually, all instances in which an agency
pursued research, development, or production of
a technology developed by a small business
concern using an award made under the SBIR
program of that agency, and determined that it
was not practicable to enter into a follow-on
non-SBIR program funding agreement with the
small business concern, which report shall
include, at a minimum--
(i) the reasons why the follow-on
funding agreement with the small
business concern was not practicable;
(ii) the identity of the entity with
which the agency contracted to perform
the research, development, or
production; and
(iii) a description of the type of
funding agreement under which the
research, development, or production
was obtained; and
(D) to implement subsection (v), including
establishing standardized procedures for the
provision of information pursuant to subsection
(k)(3).
(4) Modifications relating to procurement center
representatives.--Upon the enactment of this paragraph,
the Administrator shall modify the policy directives
issued pursuant to this subsection to require
procurement center representatives (as described in
section 15(l)) to assist small business concerns
participating in the SBIR program, particularly in
Phase III. The procurement center representatives shall
coordinate with the appropriate contracting officer and
the appropriate Director of the Office of Small and
Disadvantaged Business Utilization established pursuant
to section 15(k) for the agency letting the contract.
(k) Database.--
(1) Public database.--Not later than 180 days after
the date of the enactment of the Small Business
Innovation Research Program Reauthorization Act of
2000, the Administrator shall develop, maintain, and
make available to the public a searchable, up-to-date,
electronic database that includes--
(A) the name, size, location, and an
identifying number assigned by the
Administrator, of each small business concern
that has received a Phase I or Phase II SBIR or
STTR award from a Federal agency;
(B) a description of each Phase I or Phase II
SBIR or STTR award received by that small
business concern, including--
(i) an abstract of the project funded
by the award, excluding any proprietary
information so identified by the small
business concern;
(ii) the Federal agency making the
award; and
(iii) the date and amount of the
award;
(C) an identification of any business concern
or subsidiary established for the commercial
application of a product or service for which
an SBIR or STTR award is made;
(D) information regarding mentors and
Mentoring Networks, as required by section
35(d);
(E) with respect to assistance under the STTR
program only--
(i) whether the small business
concern or the research institution
initiated their collaboration on each
assisted STTR project;
(ii) whether the small business
concern or the research institution
originated any technology relating to
the assisted STTR project;
(iii) the length of time it took to
negotiate any licensing agreement
between the small business concern and
the research institution under each
assisted STTR project; and
(iv) how the proceeds from
commercialization, marketing, or sale
of technology resulting from each
assisted STTR project were allocated
(by percentage) between the small
business concern and the research
institution; and
(F) for each small business concern that has
received a Phase I or Phase II SBIR or STTR
award from a Federal agency, whether the small
business concern--
(i) has venture capital, hedge fund,
or private equity firm investment and,
if so, whether the small business
concern is registered as majority-owned
by multiple venture capital operating
companies, hedge funds, or private
equity firms as required under
subsection (dd)(3);
(ii) is owned by a woman or has a
woman as a principal investigator;
(iii) is owned by a socially or
economically disadvantaged individual
or has a socially or economically
disadvantaged individual as a principal
investigator;
(iv) is owned by a faculty member or
a student of an institution of higher
education, as that term is defined in
section 101 of the Higher Education Act
of 1965 (20 U.S.C. 1001); or
(v) received assistance under the
Federal and State Technology
Partnership Program (FAST Program).
(2) Government database.--Not later than 90 days
after the date of enactment of the SBIR/STTR
Reauthorization Act of 2011, the Administrator, in
consultation with Federal agencies required to have an
SBIR program pursuant to subsection (f)(1) or an STTR
program pursuant to subsection (n)(1), shall develop
and maintain a database to be used exclusively for SBIR
and STTR program evaluation that--
(A) contains for each small business concern
that applies for, submits a proposal for, or
receives an award under Phase I or Phase II of
the SBIR program or the STTR program--
(i) the name, size, and location of,
and the identifying number assigned by
the Administration to, the small
business concern;
(ii) an abstract of the applicable
project;
(iii) the specific aims of the
project;
(iv) the number of employees of the
small business concern;
(v) the names and titles of the key
individuals that will carry out the
project, the position each key
individual holds in the small business
concern, and contact information for
each key individual;
(vi) the percentage of effort each
individual described in clause (v) will
contribute to the project;
(vii) whether the small business
concern is majority-owned by multiple
venture capital operating companies,
hedge funds, or private equity firms;
and
(viii) the Federal agency to which
the application is made and contact
information for the person or office
within the Federal agency that is
responsible for reviewing applications
and making awards under the SBIR
program or the STTR program;
(B) contains for each Phase II award made by
a Federal agency--
(i) information collected in
accordance with paragraph (3) on
revenue from the sale of new products
or services resulting from the research
conducted under the award;
(ii) information collected in
accordance with paragraph (3) on
additional investment from any source,
other than Phase I or Phase II SBIR or
STTR awards, to further the research
and development conducted under the
award; and
(iii) any other information received
in connection with the award that the
Administrator, in conjunction with the
SBIR and STTR program managers of
Federal agencies, considers relevant
and appropriate;
(C) includes any narrative information that a
small business concern receiving a Phase II
award voluntarily submits to further describe
the outputs and outcomes of its awards;
(D) includes, for each awardee--
(i) the name, size, and location of,
and any identifying number assigned by
the Administrator to, the awardee;
(ii) whether the awardee has venture
capital, hedge fund, or private equity
firm investment and, if so--
(I) the amount of venture
capital, hedge fund, or private
equity firm investment as of
the date of the award;
(II) the percentage of
ownership of the awardee held
by a venture capital operating
company, hedge fund, or private
equity firm, including whether
the awardee is majority-owned
by multiple venture capital
operating companies, hedge
funds, or private equity firms;
and
(III) the amount of
additional capital that the
awardee has invested in the
SBIR or STTR technology, which
information shall be collected
on an annual basis;
(iii) the names and locations of any
affiliates of the awardee;
(iv) the number of employees of the
awardee;
(v) the number of employees of the
affiliates of the awardee; and
(vi) the names of, and the percentage
of ownership of the awardee held by--
(I) any individual who is not
a citizen of the United States
or a lawful permanent resident
of the United States; or
(II) any person that is not
an individual and is not
organized under the laws of a
State or the United States;
(E) includes any other data collected by or
available to any Federal agency that such
agency considers may be useful for SBIR or STTR
program evaluation;
(F) is available for use solely for program
evaluation purposes by the Federal Government
or, in accordance with policy directives issued
by the Administration, by other authorized
persons who are subject to a use and
nondisclosure agreement with the Federal
Government covering the use of the database;
and
(G) includes a timely and accurate list of
any individual or small business concern that
has participated in the SBIR program or STTR
program that has been--
(i) convicted of a fraud-related
crime involving funding received under
the SBIR program or STTR program; or
(ii) found civilly liable for a
fraud-related violation involving
funding received under the SBIR program
or STTR program.
(3) Updating information for database.--
(A) In general.--A small business concern
applying for a Phase II award under this
section shall be required to update information
in the database established under this
subsection for any prior Phase II award
received by that small business concern. In
complying with this paragraph, a small business
concern may apportion sales or additional
investment information relating to more than
one Phase II award among those awards, if it
notes the apportionment for each award.
(B) Annual updates upon termination.--A small
business concern receiving a Phase II award
under this section shall--
(i) update information in the
database concerning that award at the
termination of the award period; and
(ii) be requested to voluntarily
update such information annually
thereafter for a period of 5 years.
(C) Government database.--Not later than 60
days after the date established by a Federal
agency for submitting applications or proposals
for a Phase I or Phase II award under the SBIR
program or STTR program, the head of the
Federal agency shall submit to the
Administrator the data required under paragraph
(2) with respect to each small business concern
that applies or submits a proposal for the
Phase I or Phase II award.
(4) Protection of information.--Information provided
under paragraph (2) shall be considered privileged and
confidential and not subject to disclosure pursuant to
section 552 of title 5, United States Code.
(5) Rule of construction.--Inclusion of information
in the database under this subsection shall not be
considered to be publication for purposes of subsection
(a) or (b) of section 102 of title 35, United States
Code.
(l) Reporting of Awards Made From Single Proposal, to
Multiple Award Winners, or to Critical Technology Topics.--
(1) Single proposal.--If a Federal agency required to
establish an SBIR program under subsection (f) makes an
award with respect to an SBIR solicitation topic or
subtopic for which the agency received only 1 proposal,
the agency shall provide written justification for
making the award in its next quarterly report to the
Administration and in the agency's next annual report
required under subsection (g)(8).
(2) Multiple awards.--An agency referred to in
paragraph (1) shall include in its next annual report
required under subsection (g)(8) an accounting of the
awards the agency has made for Phase I of an SBIR
program during the reporting period to entities that
have received more than 15 awards for the Phase II of
an SBIR program during the preceding 5 fiscal years.
(3) Critical technology awards.--An agency referred
to in paragraph (1) shall include in its next annual
report required under subsection (g)(8), an accounting
of the number of awards it has made to critical
technology topics, as defined in subsection (g)(3),
including an identification of the specific critical
technologies topics, and the percentage by number and
dollar amount of the agency's total SBIR awards to such
critical technology topics.
(m) Termination.--The authorization to carry out the Small
Business Innovation Research Program established under this
section shall terminate on September 30, 2022.
(n) Required Expenditures for STTR by Federal Agencies.--
(1) Required expenditure amounts.--
(A) In general.--With respect to each fiscal
year through fiscal year 2022, each Federal
agency that has an extramural budget for
research, or research and development, in
excess of $1,000,000,000 for that fiscal year,
shall expend with small business concerns not
less than the percentage of that extramural
budget specified in subparagraph (B),
specifically in connection with STTR programs
that meet the requirements of this section and
any policy directives and regulations issued
under this section.
(B) Expenditure amounts.--The percentage of
the extramural budget required to be expended
by an agency in accordance with subparagraph
(A) shall be--
(i) 0.15 percent for each fiscal year
through fiscal year 2003;
(ii) 0.3 percent for each of fiscal
years 2004 through 2011;
(iii) 0.35 percent for each of fiscal
years 2012 and 2013;
(iv) 0.40 percent for each of fiscal
years 2014 and 2015; and
(v) 0.45 percent for fiscal year 2016
and each fiscal year thereafter.
(2) Limitations.--A Federal agency shall not--
(A) use any of its STTR budget established
pursuant to paragraph (1) for the purpose of
funding administrative costs of the program,
including costs associated with salaries and
expenses, or, in the case of a small business
concern or a research institution, costs
associated with salaries, expenses, and
administrative overhead (other than those
direct or indirect costs allowable under
guidelines of the Office of Management and
Budget and the governmentwide Federal
Acquisition Regulation issued in accordance
with section 25(c)(1) of the Office of Federal
Procurement Policy Act); or
(B) make available for the purpose of meeting
the requirements of paragraph (1) an amount of
its extramural budget for basic research which
exceeds the percentage specified in paragraph
(1).
(3) Exclusion of certain funding agreements.--Funding
agreements with small business concerns for research or
research and development which result from competitive
or single source selections other than an STTR program
shall not be considered to meet any portion of the
percentage requirements of paragraph (1).
(o) Federal Agency STTR Authority.--Each Federal agency
required to establish an STTR program in accordance with
subsection
(n) and regulations issued under this Act, shall--
(1) unilaterally determine categories of projects to
be included in its STTR program;
(2) issue STTR solicitations in accordance with a
schedule determined cooperatively with the
Administration;
(3) unilaterally determine research topics within the
agency's STTR solicitations, giving special
consideration to broad research topics and to topics
that further 1 or more critical technologies, as
identified--
(A) by the National Critical Technologies
Panel (or its successor) in reports required
under section 603 of the National Science and
Technology Policy, Organization, and Priorities
Act of 1976; or
(B) by the Secretary of Defense, in
accordance with section 2522 of title 10,
United States Code;
(4)(A) unilaterally receive and evaluate proposals
resulting from STTR solicitations; and
(B) make a final decision on each proposal submitted
under the STTR program--
(i) not later than 1 year after the date on
which the applicable solicitation closes, if
with respect to the National Institutes of
Health or the National Science Foundation, or
90 days after the date on which the applicable
solicitation closes, if with respect to any
other participating agency; or
(ii) if the Administrator authorizes an
extension for a solicitation, not later than 90
days after the date that would be applicable to
the agency under clause (i);
(5) unilaterally select awardees for its STTR funding
agreements and inform each awardee under such an
agreement, to the extent possible, of the expenses of
the awardee that will be allowable under the funding
agreement;
(6) administer its own STTR funding agreements (or
delegate such administration to another agency);
(7) make payments to recipients of STTR funding
agreements on the basis of progress toward or
completion of the funding agreement requirements and,
in all cases, make payment to recipients under such
agreements in full, subject to audit, on or before the
last day of the 12-month period beginning on the date
of the completion of such requirements;
(8) include, as part of its annual performance plan
as required by subsections (a) and (b) of section 1115
of title 31, United States Code, a section on its STTR
program, and shall submit such section to the Committee
on Small Business of the Senate, and the Committee on
Science and the Committee on Small Business of the
House of Representatives;
(9) collect annually, and maintain in a common format
in accordance with the simplified reporting
requirements under subsection (v), such information
from applicants and awardees as is necessary to assess
the STTR program outputs and outcomes, including
information necessary to maintain the database
described in subsection (k), including--
(A) whether an applicant or awardee--
(i) has venture capital, hedge fund,
or private equity firm investment or is
majority-owned by multiple venture
capital operating companies, hedge
funds, or private equity firms and, if
so--
(I) the amount of venture
capital, hedge fund, or private
equity firm investment that the
applicant or awardee has
received as of the date of the
application or award, as
applicable; and
(II) the amount of additional
capital that the applicant or
awardee has invested in the
STTR technology;
(ii) has an investor that--
(I) is an individual who is
not a citizen of the United
States or a lawful permanent
resident of the United States
and, if so, the name of any
such individual; or
(II) is a person that is not
an individual and is not
organized under the laws of a
State or the United States and,
if so, the name of any such
person;
(iii) is owned by a woman or has a
woman as a principal investigator;
(iv) is owned by a socially or
economically disadvantaged individual
or has a socially or economically
disadvantaged individual as a principal
investigator;
(v) is a faculty member or a student
of an institution of higher education,
as that term is defined in section 101
of the Higher Education Act of 1965 (20
U.S.C. 1001); or
(vi) is located in a State in which
the total value of contracts awarded to
small business concerns under all STTR
programs is less than the total value
of contracts awarded to small business
concerns in a majority of other States,
as determined by the Administrator in
biennial fiscal years, beginning with
fiscal year 2008, based on the most
recent statistics compiled by the
Administrator;
(B) if an awardee receives an award in an
amount that is more than the award guidelines
under this section, a statement from the agency
that justifies the award amount; and
(C) data with respect to the Federal and
State Technology Partnership Program (FAST
Program);
(10) submit an annual report on the STTR program to
the Administration and the Office of Science and
Technology Policy;
(11) adopt the agreement developed by the
Administrator under subsection
(w) as the agency's model agreement for allocating between
small business concerns and research institutions intellectual
property rights and rights, if any, to carry out follow-on
research, development, or commercialization;
(12) develop, in consultation with the Office of
Federal Procurement Policy and the Office of Government
Ethics, procedures to ensure that federally funded
research and development centers (as defined in
subsection (e)(8)) that participate in STTR
agreements--
(A) are free from organizational conflicts of
interests relative to the STTR program;
(B) do not use privileged information gained
through work performed for an STTR agency or
private access to STTR agency personnel in the
development of an STTR proposal; and
(C) use outside peer review, as appropriate;
(13) not later than July 31, 1993, develop procedures
for assessing the commercial merit and feasibility of
STTR proposals, as evidenced by--
(A) the small business concern's record of
successfully commercializing STTR or other
research;
(B) the existence of Phase II funding
commitments from private sector or non-STTR
funding sources;
(C) the existence of Phase III follow-on
commitments for the subject of the research;
and
(D) the presence of other indicators of the
commercial potential of the idea;
(14) implement an outreach program to research
institutions and small business concerns for the
purpose of enhancing its STTR program, in conjunction
with any such outreach done for purposes of the SBIR
program;
(15) provide for and fully implement the tenets of
Executive Order No. 13329 (Encouraging Innovation in
Manufacturing); and
(16) provide timely notice to the Administrator of
any case or controversy before any Federal judicial or
administrative tribunal concerning the STTR program of
the Federal agency.
(p) STTR Policy Directive.--
(1) Issuance.--The Administrator shall issue a policy
directive for the general conduct of the STTR programs
within the Federal Government. Such policy directive
shall be issued after consultation with--
(A) the heads of each of the Federal agencies
required by subsection (n) to establish an STTR
program;
(B) the Under Secretary of Commerce for
Intellectual Property and Director of the
United States Patent and Trademark Office; and
(C) the Director of the Office of Federal
Procurement Policy.
(2) Contents.--The policy directive required by
paragraph
(1) shall provide for--
(A) simplified, standardized, and timely STTR
solicitations;
(B) a simplified, standardized funding
process that provides for--
(i) the timely receipt and review of
proposals;
(ii) outside peer review, if
appropriate;
(iii) protection of proprietary
information provided in proposals;
(iv) selection of awardees;
(v) retention by a small business
concern of the rights to data generated
by the concern in the performance of an
STTR award for a period of not less
than 4 years;
(vi) continued use by a small
business concern, as a directed
bailment, of any property transferred
by a Federal agency to the small
business concern in Phase II of the
STTR program for a period of not less
than 2 years, beginning on the initial
date of the concern's participation in
Phase III of such program;
(vii) cost sharing;
(viii) cost principles and payment
schedules; and
(ix) 1-year awards for Phase I of an
STTR program, generally not to exceed
$150,000, and 2-year awards for Phase
II of an STTR program, generally not to
exceed $1,000,000, (each of which the
Administrator shall adjust for
inflation annually) greater or lesser
amounts to be awarded at the discretion
of the awarding agency, and shorter or
longer periods of time to be approved
at the discretion of the awarding
agency where appropriate for a
particular project;
(C) minimizing regulatory burdens associated
with participation in STTR programs;
(D) guidelines for a model agreement, to be
used by all agencies, for allocating between
small business concerns and research
institutions intellectual property rights and
rights, if any, to carry out follow-on
research, development, or commercialization;
(E) procedures to ensure that--
(i) a recipient of an STTR award is a
small business concern, as defined in
section 3 and the regulations
promulgated thereunder; and
(ii) such small business concern
exercises management and control of the
performance of the STTR funding
agreement pursuant to a business plan
providing for the commercialization of
the technology that is the subject
matter of the award; [and]
(F) procedures to ensure, to the extent
practicable, that an agency which intends to
pursue research, development, or production of
a technology developed by a small business
concern under an STTR program enters into
follow-on, non-STTR funding agreements with the
small business concern for such research,
development, or production[.]; and
(G) procedures to ensure that procurement
center representatives (as described in section
15(l))--
(i) assist small business concerns
participating in the STTR program,
particularly in Phase III; and
(ii) coordinate with the appropriate
contracting officer and the appropriate
Director of the Office of Small and
Disadvantaged Business Utilization
established pursuant to section 15(k)
for the Federal agency letting the
contract in providing the assistance
described in clause (i).
(3) Modifications.--Not later than 120 days after the
date of enactment of this paragraph, the Administrator
shall modify the policy directive issued pursuant to
this subsection to clarify that the rights provided for
under paragraph (2)(B)(v) apply to all Federal funding
awards under this section, including Phase I, Phase II,
and Phase III.
(q) Discretionary Technical and Business Assistance.--
(1) In general.--Each Federal agency required by this
section to conduct an SBIR program or STTR program may
enter into an agreement with [a vendor selected under
paragraph (2)] 1 or more vendors selected under
paragraph (2)(A) to provide small business concerns
engaged in SBIR or STTR projects with technical and
business assistance services, such as access to a
network of scientists and engineers engaged in a wide
range of technologies, assistance with product sales,
intellectual property protections, market research,
market validation, and development of regulatory plans
and manufacturing plans, or access to technical and
business literature available through on-line data
bases, for the purpose of assisting such concerns in--
(A) making better technical decisions
concerning such projects;
(B) solving technical problems which arise
during the conduct of such projects;
(C) minimizing technical risks associated
with such projects; and
(D) developing and commercializing new
commercial products and processes resulting
from such projects, including intellectual
property protections.
(2) Vendor selection.--[Each agency may select a
vendor to assist small business concerns to meet]
(A) In general._Each agency may select 1 or
more vendors from which small business concerns
may obtain assistance in meeting the goals
listed in paragraph (1) for a term not to
exceed 5 years. Such selection shall be
competitive and shall utilize merit-based
criteria.
(B) Selection by small business concern.--A
small business concern may, by contract or
otherwise, select 1 or more vendors to assist
the small business concern in meeting the goals
listed in paragraph (1).
(3) Additional technical assistance.--
(A) Phase i.--A Federal agency described in
paragraph
(1) may--
(i) provide to the recipient of a
Phase I SBIR or STTR award, through a
vendor selected under paragraph (2)(A),
the services described in paragraph
(1), in an amount equal to not more
than [$5,000 per year] $6,500 per
project; or
(ii) authorize the recipient of a
Phase I SBIR or STTR award to purchase
the services described in paragraph
(1), in an amount equal to not more
than [$5,000 per year] $6,500 per
project, which shall be in addition to
the amount of the recipient's award.
(B) Phase ii.--A Federal agency described in
paragraph
(1) may--
(i) provide to the recipient of a
Phase II SBIR or STTR award, through a
vendor selected under paragraph (2)(A),
the services described in paragraph
(1), in an amount equal to not more
than [$5,000 per year] $35,000 per
project; or
(ii) authorize the recipient of a
Phase II SBIR or STTR award to purchase
the services described in paragraph
(1), in an amount equal to not more
than [$5,000 per year] $35,000 per
project, [which shall be in addition to
the amount of the recipient's award]
which may, as determined appropriate by
the head of the agency, be included as
part of the recipient's award or be in
addition to the amount of the
recipient's award.
(C) Flexibility.--In carrying out
subparagraphs (A) and (B), each Federal agency
shall provide the allowable amounts to a
recipient that meets the eligibility
requirements under the applicable subparagraph,
if the recipient requests to seek technical or
business assistance from an individual or
entity other than [the vendor] a vendor
selected under paragraph (2)(A) by the Federal
agency. Business-related services aimed at
improving the commercialization success of a
small business concern may be obtained from an
entity, such as a public or private
organization or an agency of or other entity
established or funded by a State that
facilitates or accelerates the
commercialization of technologies or assists in
the creation and growth of private enterprises
that are commercializing technology.
(D) Limitation.--A Federal agency may not--
(i) use the amounts authorized under
subparagraph (A) or (B) unless [the
vendor] 1 or more vendors selected
under paragraph (2)(A) provides the
technical or business assistance to the
recipient; or
(ii) enter a contract with a vendor
under paragraph (2)(A) under which the
amount provided for technical or
business assistance is based on total
number of Phase I or Phase II awards.
(E) Multiple award recipients.--The
Administrator shall establish a limit on the
amount of technical and business assistance
services that may be received or purchased
under subparagraph (B) by a small business
concern that has received multiple Phase II
SBIR or STTR awards for a fiscal year.
(r) Phase III Agreements.--
(1) In general.--In the case of a small business
concern that is awarded a funding agreement for Phase
II of an SBIR or STTR program, a Federal agency may
enter into a Phase III agreement with that business
concern for additional work to be performed during or
after the Phase II period. The Phase II funding
agreement with the small business concern may, at the
discretion of the agency awarding the agreement, set
out the procedures applicable to Phase III agreements
with that agency or any other agency.
(2) Definition.--In this subsection, the term ``Phase
III agreement'' means a follow-on, non-SBIR or non-STTR
funded contract as described in paragraph (4)(C) or
paragraph (6)(C) of subsection (e).
(3) Intellectual property rights.--Each funding
agreement under an SBIR or STTR program shall include
provisions setting forth the respective rights of the
United States and the small business concern with
respect to intellectual property rights and with
respect to any right to carry out follow-on research.
(4) Phase iii awards.--To the greatest extent
practicable, Federal agencies and Federal prime
contractors shall issue Phase III awards relating to
technology[, including sole source awards,] as direct
follow-on awards issued without further competition to
the SBIR and STTR award recipients that developed the
technology.
(s) Competitive Selection Procedures for SBIR and STTR
Programs.--All funds awarded, appropriated, or otherwise made
available in accordance with subsection (f) or (n) must be
awarded pursuant to competitive and merit-based selection
procedures.
(t) Inclusion in Strategic Plans.--Program information
relating to the SBIR and STTR programs shall be included by
each Federal agency in any update or revision required of the
Federal agency under section 306(b) of title 5, United States
Code.
(u) Coordination of Technology Development Programs.--
(1) Definition of technology development program.--In
this subsection, the term ``technology development
program'' means--
(A) the Experimental Program to Stimulate
Competitive Research of the National Science
Foundation, as established under section 113 of
the National Science Foundation Authorization
Act of 1988 (42 U.S.C. 1862g);
(B) the Defense Experimental Program to
Stimulate Competitive Research of the
Department of Defense;
(C) the Experimental Program to Stimulate
Competitive Research of the Department of
Energy;
(D) the Experimental Program to Stimulate
Competitive Research of the Environmental
Protection Agency;
(E) the Experimental Program to Stimulate
Competitive Research of the National
Aeronautics and Space Administration;
(F) the Institutional Development Award
Program of the National Institutes of Health;
and
(G) the National Research Initiative
Competitive Grants Program of the Department of
Agriculture.
(2) Coordination requirements.--Each Federal agency
that is subject to subsection (f) and that has
established a technology development program may, in
each fiscal year, review for funding under that
technology development program--
(A) any proposal to provide outreach and
assistance to one or more small business
concerns interested in participating in the
SBIR program, including any proposal to make a
grant or loan to a company to pay a portion or
all of the cost of developing an SBIR proposal,
from an entity, organization, or individual
located in--
(i) a State that is eligible to
participate in that program; or
(ii) a State described in paragraph
(3); or
(B) any proposal for Phase I of the SBIR
program, if the proposal, though meritorious,
is not funded through the SBIR program for that
fiscal year due to funding restraints, from a
small business concern located in--
(i) a State that is eligible to
participate in a technology development
program; or
(ii) a State described in paragraph
(3).
(3) Additionally eligible state.--A State referred to
in subparagraph (A)(ii) or (B)(ii) of paragraph (2) is
a State in which the total value of contracts awarded
to small business concerns under all SBIR programs is
less than the total value of contracts awarded to small
business concerns in a majority of other States, as
determined by the Administrator in biennial fiscal
years, beginning with fiscal year 2000, based on the
most recent statistics compiled by the Administrator.
(v) Reducing Paperwork and Compliance Burden.--
(1) Standardization of reporting requirements.--The
Administrator shall work with the Federal agencies
required by this section to have an SBIR or STTR
program to standardize reporting requirements for the
collection of data from SBIR or STTR applicants and
awardees, including data for inclusion in the database
under subsection (k), taking into consideration the
unique needs of each agency, and to the extent
possible, permitting the updating of previously
reported information by electronic means. Such
requirements shall be designed to minimize the burden
on small businesses.
(2) Simplification of application and award
process.--Not later than 1 year after the date of
enactment of this paragraph, and after a period of
public comment, the Administrator shall issue
regulations or guidelines, taking into consideration
the unique needs of each Federal agency, to ensure that
each Federal agency required to carry out an SBIR
program or STTR program simplifies and standardizes the
program proposal, selection, contracting, compliance,
and audit procedures for the SBIR program or STTR
program of the Federal agency (including procedures
relating to overhead rates for applicants and
documentation requirements) to reduce the paperwork and
regulatory compliance burden on small business concerns
applying to and participating in the SBIR program or
STTR program.
(w) STTR Model Agreement for Intellectual Property Rights.--
(1) In general.--The Administrator shall promulgate
regulations establishing a single model agreement for
use in the STTR program that allocates between small
business concerns and research institutions
intellectual property rights and rights, if any, to
carry out follow-on research, development, or
commercialization.
(2) Opportunity for comment.--In promulgating
regulations under paragraph (1), the Administrator
shall provide to affected agencies, small business
concerns, research institutions, and other interested
parties the opportunity to submit written comments.
(x) Research and Development Focus.--
(1) Revision and update of criteria and procedures of
identification.--In carrying out subsection (g), the
Secretary of Defense shall, not less often than once
every 4 years, revise and update the criteria and
procedures utilized to identify areas of the research
and development efforts of the Department of Defense
which are suitable for the provision of funds under the
Small Business Innovation Research Program and the
Small Business Technology Transfer Program.
(2) Utilization of plans.--The criteria and
procedures described in paragraph (1) shall be
developed through the use of the most current versions
of the following plans:
(A) The Joint Warfighting Science and
Technology Plan required under section 270 of
the National Defense Authorization Act for
Fiscal Year 1997 (Public Law 104-201; 10 U.S.C.
2501 note).
(B) The Defense Technology Area Plan of the
Department of Defense.
(C) The Basic Research Plan of the Department
of Defense.
(3) Input in identification of areas of effort.--The
criteria and procedures described in paragraph (1)
shall include input in the identification of areas of
research and development efforts described in that
paragraph from Department of Defense program managers
(PMs) and program executive officers (PEOs).
(y) Commercialization Readiness Program.--
(1) In general.--The Secretary of Defense and the
Secretary of each military department is authorized to
create and administer a ``Commercialization Readiness
Program'' to accelerate the transition of technologies,
products, and services developed under the Small
Business Innovation Research Program or Small Business
Technology Transfer Program to Phase III, including the
acquisition process. The authority to create and
administer a Commercialization Readiness Program under
this subsection may not be construed to eliminate or
replace any other SBIR program or STTR program that
enhances the insertion or transition of SBIR or STTR
technologies, including any such program in effect on
the date of enactment of the National Defense
Authorization Act for Fiscal Year 2006 (Public Law 109-
163; 119 Stat. 3136).
(2) Identification of research programs for
accelerated transition to acquisition process.--In
carrying out the Commercialization Readiness Program,
the Secretary of Defense and the Secretary of each
military department shall identify research programs of
the Small Business Innovation Research Program or Small
Business Technology Transfer Program that have the
potential for rapid transitioning to Phase III and into
the acquisition process.
(3) Limitation.--No research program may be
identified under paragraph (2) unless the Secretary of
the military department concerned certifies in writing
that the successful transition of the program to Phase
III and into the acquisition process is expected to
meet high priority military requirements of such
military department.
(4) Funding.--
(A) In general.--The Secretary of Defense and
each Secretary of a military department may use
not more than an amount equal to 1 percent of
the funds available to the Department of
Defense or the military department pursuant to
the Small Business Innovation Research Program
for payment of expenses incurred to administer
the Commercialization Readiness Program under
this subsection.
(B) Limitations.--The funds described in
subparagraph (A)--
(i) shall not be subject to the
limitations on the use of funds in
subsection (f)(2); and
(ii) shall not be used to make Phase
III awards.
(5) Insertion incentives.--For any contract with a
value of not less than $100,000,000, the Secretary of
Defense [is authorized to] shall--
(A) establish goals for the transition of
Phase III technologies in subcontracting plans;
and
(B) require a prime contractor on such a
contract to report the number and dollar amount
of contracts entered into by that prime
contractor for Phase III SBIR or STTR projects.
(6) Goal for sbir and sttr technology insertion.--The
Secretary of Defense shall--
(A) set a goal to increase the number of
Phase II SBIR contracts and the number of Phase
II STTR contracts awarded by the Secretary that
lead to technology transition into programs of
record or fielded systems;
(B) use incentives in effect on the date of
enactment of the SBIR/STTR Reauthorization Act
of 2011, or create new incentives, to encourage
agency program managers and prime contractors
to meet the goal under subparagraph (A); [and]
(C) submit to the Administrator for inclusion
in the annual report under subsection (b)(7)--
(i) the number and percentage of
Phase II SBIR and STTR contracts
awarded by the Secretary that led to
technology transition into programs of
record or fielded systems;
(ii) information on the status of
each project that received funding
through the Commercialization Readiness
Program and efforts to transition those
projects into programs of record or
fielded systems; and
(iii) a description of each incentive
that has been used by the Secretary
under subparagraph (B) and the
effectiveness of that incentive with
respect to meeting the goal under
subparagraph (A)[.]; and
(D) not later than 120 days after the date of
the enactment of this subparagraph, and not
later than December 31 of each year thereafter,
submit to the Committee on Science, Space, and
Technology and the Committee on Small Business
of the House of Representatives, and to the
Committee on Small Business and
Entrepreneurship of the Senate, a report
describing the goals set under subparagraph (A)
and the incentives used or created under
subparagraph (B).
(z) Encouraging Innovation in Energy Efficiency.--
(1) Federal agency energy-related priority.--In
carrying out its duties under this section relating to
SBIR and STTR solicitations by Federal departments and
agencies, the Administrator shall--
(A) ensure that such departments and agencies
give high priority to small business concerns
that participate in or conduct energy
efficiency or renewable energy system research
and development projects; and
(B) include in the annual report to Congress
under subsection (b)(7) a determination of
whether the priority described in subparagraph
(A) is being carried out.
(2) Consultation required.--The Administrator shall
consult with the heads of other Federal departments and
agencies in determining whether priority has been given
to small business concerns that participate in or
conduct energy efficiency or renewable energy system
research and development projects, as required by this
subsection.
(3) Guidelines.--The Administrator shall, as soon as
is practicable after the date of enactment of this
subsection, issue guidelines and directives to assist
Federal agencies in meeting the requirements of this
subsection.
(4) Definitions.--In this subsection--
(A) the term ``biomass''--
(i) means any organic material that
is available on a renewable or
recurring basis, including--
(I) agricultural crops;
(II) trees grown for energy
production;
(III) wood waste and wood
residues;
(IV) plants (including
aquatic plants and grasses);
(V) residues;
(VI) fibers;
(VII) animal wastes and other
waste materials; and
(VIII) fats, oils, and
greases (including recycled
fats, oils, and greases); and
(ii) does not include--
(I) paper that is commonly
recycled; or
(II) unsegregated solid
waste;
(B) the term ``energy efficiency project''
means the installation or upgrading of
equipment that results in a significant
reduction in energy usage; and
(C) the term ``renewable energy system''
means a system of energy derived from--
(i) a wind, solar, biomass (including
biodiesel), or geothermal source; or
(ii) hydrogen derived from biomass or
water using an energy source described
in clause (i).
(aa) Limitation on Size of Awards.--
(1) Limitation.--No Federal agency may issue an award
under the SBIR program or the STTR program if the size
of the award exceeds the award guidelines established
under this section by more than 50 percent.
(2) Maintenance of information.--Participating
agencies shall maintain information on awards exceeding
the guidelines established under this section,
including--
(A) the amount of each award;
(B) a justification for exceeding the
guidelines for each award;
(C) the identity and location of each award
recipient; and
(D) whether an award recipient has received
any venture capital, hedge fund, or private
equity firm investment and, if so, whether the
recipient is majority-owned by multiple venture
capital operating companies, hedge funds, or
private equity firms.
(3) Reports.--The Administrator shall include the
information described in paragraph
(2) in the annual report of the Administrator to Congress.
(4) Waiver for specific topic.--Upon the receipt of
an application from a Federal agency, the Administrator
may grant a waiver from the requirement under paragraph
(1) with respect to a specific topic (but not for the
agency as a whole) for a fiscal year if the
Administrator determines, based on the information
contained in the application from the agency, that--
(A) the requirement under paragraph (1) will
interfere with the ability of the agency to
fulfill its research mission through the SBIR
program or the STTR program; and
(B) the agency will minimize, to the maximum
extent possible, the number of awards that do
not satisfy the requirement under paragraph (1)
to preserve the nature and intent of the SBIR
program and the STTR program.
(5) Rule of construction.--Nothing in this subsection
shall be construed to prevent a Federal agency from
supplementing an award under the SBIR program or the
STTR program using funds of the Federal agency that are
not part of the SBIR program or the STTR program of the
Federal agency.
(bb) Subsequent Phase II Awards.--
(1) Agency flexibility.--A small business concern
that received a Phase I award from a Federal agency
under this section shall be eligible to receive a
subsequent Phase II award from another Federal agency,
if the head of each relevant Federal agency or the
relevant component of the Federal agency makes a
written determination that the topics of the relevant
awards are the same and both agencies report the awards
to the Administrator for inclusion in the public
database under subsection (k).
(2) SBIR and sttr program flexibility.--A small
business concern that received a Phase I award under
this section under the SBIR program or the STTR program
may receive a subsequent Phase II award in either the
SBIR program or the STTR program and the participating
agency or agencies shall report the awards to the
Administrator for inclusion in the public database
under subsection (k).
(3) Preventing duplicative awards.--The head of a
Federal agency shall verify that any activity to be
performed with respect to a project with a Phase I or
Phase II SBIR or STTR award has not been funded under
the SBIR program or STTR program of another Federal
agency.
(cc) Phase Flexibility.--[During fiscal years 2012 through
2017, the National Institutes of Health, the Department of
Defense, and the Department of Education may each provide]
During fiscal years 2018 through 2022, all agencies
participating in the SBIR program may provide to a small
business concern an award under Phase II of the SBIR program
with respect to a project, without regard to whether the small
business concern was provided an award under Phase I of an SBIR
program with respect to such project, if the head of the
applicable agency determines that the small business concern
has completed the determinations described in subsection
(e)(4)(A) with respect to such project despite not having been
provided a Phase I award.
(dd) Participation of Small Business Concerns Majority-Owned
by Venture Capital Operating Companies, Hedge Funds, or Private
Equity Firms in the SBIR Program.--
(1) Authority.--Upon providing a written
determination described in paragraph (2) to the
Administrator, the Committee on Small Business and
Entrepreneurship of the Senate, and the Committee on
Small Business and the Committee on Science, Space, and
Technology of the House of Representatives, not later
than 30 days before the date on which any such award is
made--
(A) the Director of the National Institutes
of Health, the Secretary of Energy, and the
Director of the National Science Foundation may
award not more than 25 percent of the funds
allocated for the SBIR program of the
applicable Federal agency to small business
concerns that are owned in majority part by
multiple venture capital operating companies,
hedge funds, or private equity firms through
competitive, merit-based procedures that are
open to all eligible small business concerns;
and
(B) the head of a Federal agency other than a
Federal agency described in subparagraph (A)
that participates in the SBIR program may award
not more than 15 percent of the funds allocated
for the SBIR program of the Federal agency to
small business concerns that are owned in
majority part by multiple venture capital
operating companies, hedge funds, or private
equity firms through competitive, merit-based
procedures that are open to all eligible small
business concerns.
(2) Determination.--A written determination described
in this paragraph is a written determination by the
head of a Federal agency that explains how the use of
the authority under paragraph (1) will--
(A) induce additional venture capital, hedge
fund, or private equity firm funding of small
business innovations;
(B) substantially contribute to the mission
of the Federal agency;
(C) demonstrate a need for public research;
and
(D) otherwise fulfill the capital needs of
small business concerns for additional
financing for SBIR projects.
(3) Registration.--A small business concern that is
majority-owned by multiple venture capital operating
companies, hedge funds, or private equity firms and
qualified for participation in the program authorized
under paragraph
(1) shall--
(A) register with the Administrator on the
date that the small business concern submits an
application for an award under the SBIR
program; and
(B) indicate in any SBIR proposal that the
small business concern is registered under
subparagraph (A) as majority-owned by multiple
venture capital operating companies, hedge
funds, or private equity firms.
(4) Compliance.--
(A) In general.--The head of a Federal agency
that makes an award under this subsection
during a fiscal year shall collect and submit
to the Administrator data relating to the
number and dollar amount of Phase I awards,
Phase II awards, and any other category of
awards by the Federal agency under the SBIR
program during that fiscal year.
(B) Annual reporting.--The Administrator
shall include as part of each annual report by
the Administration under subsection (b)(7) any
data submitted under subparagraph (A) and a
discussion of the compliance of each Federal
agency that makes an award under this
subsection during the fiscal year with the
maximum percentages under paragraph (1).
(5) Enforcement.--If a Federal agency awards more
than the percent of the funds allocated for the SBIR
program of the Federal agency authorized under
paragraph (1) for a purpose described in paragraph (1),
the head of the Federal agency shall transfer an amount
equal to the amount awarded in excess of the amount
authorized under paragraph (1) to the funds for general
SBIR programs from the non-SBIR and non-STTR research
and development funds of the Federal agency not later
than 180 days after the date on which the Federal
agency made the award that caused the total awarded
under paragraph (1) to be more than the amount
authorized under paragraph (1) for a purpose described
in paragraph (1).
(6) Final decisions on applications under the sbir
program.--
(A) Definition.--In this paragraph, the term
``covered small business concern'' means a
small business concern that--
(i) was not majority-owned by
multiple venture capital operating
companies, hedge funds, or private
equity firms on the date on which the
small business concern submitted an
application in response to a
solicitation under the SBIR programs;
and
(ii) on the date of the award under
the SBIR program is majority-owned by
multiple venture capital operating
companies, hedge funds, or private
equity firms.
(B) In general.--If a Federal agency does not
make an award under a solicitation under the
SBIR program before the date that is 9 months
after the date on which the period for
submitting applications under the solicitation
ends--
(i) a covered small business concern
is eligible to receive the award,
without regard to whether the covered
small business concern meets the
requirements for receiving an award
under the SBIR program for a small
business concern that is majority-owned
by multiple venture capital operating
companies, hedge funds, or private
equity firms, if the covered small
business concern meets all other
requirements for such an award; and
(ii) the head of the Federal agency
shall transfer an amount equal to any
amount awarded to a covered small
business concern under the solicitation
to the funds for general SBIR programs
from the non-SBIR and non-STTR research
and development funds of the Federal
agency, not later than 90 days after
the date on which the Federal agency
makes the award.
(7) Evaluation criteria.--A Federal agency may not
use investment of venture capital or investment from
hedge funds or private equity firms as a criterion for
the award of contracts under the SBIR program or STTR
program.
(ee) Collaborating With Federal Laboratories and Research and
Development Centers.--
(1) Authorization.--Subject to the limitations under
this section, the head of each participating Federal
agency may make SBIR and STTR awards to any eligible
small business concern that--
(A) intends to enter into an agreement with a
Federal laboratory or federally funded research
and development center for portions of the
activities to be performed under that award; or
(B) has entered into a cooperative research
and development agreement (as defined in
section 12(d) of the Stevenson-Wydler
Technology Innovation Act of 1980 (15 U.S.C.
3710a(d))) with a Federal laboratory.
(2) Prohibition.--No Federal agency shall--
(A) condition an SBIR or STTR award upon
entering into agreement with any Federal
laboratory or any federally funded laboratory
or research and development center for any
portion of the activities to be performed under
that award;
(B) approve an agreement between a small
business concern receiving an SBIR or STTR
award and a Federal laboratory or federally
funded laboratory or research and development
center, if the small business concern performs
a lesser portion of the activities to be
performed under that award than required by
this section and by the SBIR Policy Directive
and the STTR Policy Directive of the
Administrator; or
(C) approve an agreement that violates any
provision, including any data rights
protections provision, of this section or the
SBIR and the STTR Policy Directives.
(3) Implementation.--Not later than 180 days after
the date of enactment of this subsection, the
Administrator shall modify the SBIR Policy Directive
and the STTR Policy Directive issued under this section
to ensure that small business concerns--
(A) have the flexibility to use the resources
of the Federal laboratories or federally funded
research and development centers; and
(B) are not mandated to enter into agreement
with any Federal laboratory or any federally
funded laboratory or research and development
center as a condition of an award.
(4) Advance payment.--If a small business concern
receiving an award under this section enters into an
agreement with a Federal laboratory or federally funded
research and development center for portions of the
activities to be performed under that award, the
Federal laboratory or federally funded research and
development center may not require advance payment from
the small business concern in an amount greater than
the amount necessary to pay for 30 days of such
activities.
(ff) Additional SBIR and STTR Awards.--
(1) Express authority for awarding a sequential phase
ii award.--A small business concern that receives a
Phase II SBIR award or a Phase II STTR award for a
project remains eligible to receive 1 additional Phase
II SBIR award or Phase II STTR award for continued work
on that project.
(2) Preventing duplicative awards.--The head of a
Federal agency shall verify that any activity to be
performed with respect to a project with a Phase I or
Phase II SBIR or STTR award has not been funded under
the SBIR program or STTR program of another Federal
agency.
(gg) [Pilot Program.--] Civilian Agency Commercialization
Readiness Program._
(1) Authorization.--The head of each covered Federal
agency may allocate not more than 10 percent of the
funds allocated to the SBIR program and the STTR
program of the covered Federal agency to establish a
Civilian Agency Commercialization Readiness Program for
civilian agencies--
(A) for awards for technology development,
testing, evaluation, and commercialization
assistance for SBIR and STTR Phase II
technologies; or
(B) to support the progress of research,
research and development, and commercialization
conducted under the SBIR or STTR programs to
Phase III.
(2) Application by federal agency.--
(A) In general.--A covered Federal agency may
not [establish a pilot program] establish a
Civilian Agency Commercialization Readiness
Program under this subsection unless the
covered Federal agency makes a written
application to the Administrator, not later
than 90 days before the first day of the fiscal
year in which [the pilot program] such Civilian
Agency Commercialization Readiness Program is
to be established, that describes a compelling
reason that additional investment in SBIR or
STTR technologies is necessary, including
unusually high regulatory, systems integration,
or other costs relating to development or
manufacturing of identifiable, highly promising
small business technologies or a class of such
technologies expected to substantially advance
the mission of the agency.
(B) Determination.--The Administrator shall--
(i) make a determination regarding an
application submitted under
subparagraph (A) not later than 30 days
before the first day of the fiscal year
for which the application is submitted;
(ii) publish the determination in the
Federal Register; and
(iii) make a copy of the
determination and any related materials
available to the Committee on Small
Business and Entrepreneurship of the
Senate and the Committee on Small
Business and the Committee on Science,
Space, and Technology of the House of
Representatives.
(3) Maximum amount of award.--The head of a covered
Federal agency may not make an award under [a pilot
program] a Civilian Commercialization Readiness Program
in excess of 3 times the dollar amounts generally
established for Phase II awards under subsection
(j)(2)(D) or (p)(2)(B)(ix).
(4) Registration.--Any applicant that receives an
award under [a pilot program] a Civilian
Commercialization Readiness Program shall register with
the Administrator in a registry that is available to
the public.
(5) Award criteria or consideration.--When making an
award under this section, the head of a covered Federal
agency shall give consideration to whether the
technology to be supported by the award is likely to be
manufactured in the United States.
(6) Report.--The head of each covered Federal agency
shall include in the annual report of the covered
Federal agency to the Administrator an analysis of the
various activities considered for inclusion in [the
pilot program] a Civilian Agency Commercialization
Readiness Program of the covered Federal agency and a
statement of the reasons why each activity considered
was included or not included, as the case may be.
[(7) Termination.--The authority to establish a pilot
program under this section expires at the end of fiscal
year 2017.]
[(8)] (7) Definitions.--In this subsection--
(A) the term ``covered Federal agency''--
(i) means a Federal agency
participating in the SBIR program or
the STTR program; and
(ii) does not include the Department
of Defense; and
[(B) the term ``pilot program'' means each
program established under paragraph (1).]
(B) the term ``Civilian Agency
Commercialization Readiness Program'' means
each program established under paragraph (1).
(hh) Timing of Release of Funding.--Federal agencies
participating in the SBIR program or STTR program shall, to the
extent possible, attempt to shorten the amount of time between
the provision of notice of an award under the SBIR program or
STTR program and the subsequent release of funding with respect
to the award.
(ii) Reporting on Timing.--Federal agencies participating in
the SBIR program or STTR program shall provide to the
Administrator, for the annual report on the SBIR and STTR
program under subsection (b)(7), the average amount of time the
agency takes to make a final decision on proposals submitted
under such programs, the average amount of time the agency
takes to release funding with respect to an award under such
programs, and the goals established to reduce such amounts.
(jj) Phase 0 Proof of Concept Partnership Pilot Program.--
(1) In general.--The Director of the National
Institutes of Health may use $5,000,000 of the funds
allocated under subsection (n)(1) for a Proof of
Concept Partnership pilot program to accelerate the
creation of small businesses and the commercialization
of research innovations from qualifying institutions.
To implement this program, the Director shall award,
through a competitive, merit-based process, grants to
qualifying institutions. These grants shall only be
used to administer Proof of Concept Partnership awards
in conformity with this subsection.
(2) Definitions.--In this subsection--
(A) the term ``Director'' means the Director
of the National Institutes of Health;
(B) the term ``pilot program'' refers to the
Proof of Concept Partnership pilot program; and
(C) the terms ``qualifying institution'' and
``institution'' mean a university or other
research institution that participates in the
National Institutes of Health's STTR program.
(3) Proof of concept partnerships.--
(A) In general.--A Proof of Concept
Partnership shall be set up by a qualifying
institution to award grants to individual
researchers. These grants should provide
researchers with the initial investment and the
resources to support the proof of concept work
and commercialization mentoring needed to
translate promising research projects and
technologies into a viable company. This work
may include technical validations, market
research, clarifying intellectual property
rights position and strategy, and investigating
commercial or business opportunities.
(B) Award guidelines.--The administrator of a
Proof of Concept Partnership program shall
award grants in accordance with the following
guidelines:
(i) The Proof of Concept Partnership
shall use a market-focused project
management oversight process,
including--
(I) a rigorous, diverse
review board comprised of local
experts in translational and
proof of concept research,
including industry, start-up,
venture capital, technical,
financial, and business experts
and university technology
transfer officials;
(II) technology validation
milestones focused on market
feasibility;
(III) simple reporting
effective at redirecting
projects; and
(IV) the willingness to
reallocate funding from failing
projects to those with more
potential.
(ii) Not more than $100,000 shall be
awarded towards an individual proposal.
(C) Educational resources and guidance.--The
administrator of a Proof of Concept Partnership
program shall make educational resources and
guidance available to researchers attempting to
commercialize their innovations.
(4) Awards.--
(A) Size of award.--The Director may make
awards to a qualifying institution for up to
$1,000,000 per year for up to 3 years.
(B) Award criteria.--In determining which
qualifying institutions receive pilot program
grants, the Director shall consider, in
addition to any other criteria the Director
determines necessary, the extent to which
qualifying institutions--
(i) have an established and proven
technology transfer or
commercialization office and have a
plan for engaging that office in the
program's implementation;
(ii) have demonstrated a commitment
to local and regional economic
development;
(iii) are located in diverse
geographies and are of diverse sizes;
(iv) can assemble project management
boards comprised of industry, start-up,
venture capital, technical, financial,
and business experts;
(v) have an intellectual property
rights strategy or office; and
(vi) demonstrate a plan for
sustainability beyond the duration of
the funding award.
(5) Limitations.--The funds for the pilot program
shall not be used--
(A) for basic research, but to evaluate the
commercial potential of existing discoveries,
including--
(i) proof of concept research or
prototype development; and
(ii) activities that contribute to
determining a project's
commercialization path, to include
technical validations, market research,
clarifying intellectual property
rights, and investigating commercial
and business opportunities; or
(B) to fund the acquisition of research
equipment or supplies unrelated to
commercialization activities.
(6) Evaluative report.--The Director shall submit to
the Committee on Science, Space, and Technology and the
Committee on Small Business of the House of
Representatives and the Committee on Small Business and
Entrepreneurship of the Senate an evaluative report
regarding the activities of the pilot program. The
report shall include--
(A) a detailed description of the
institutional and proposal selection process;
(B) an accounting of the funds used in the
pilot program;
(C) a detailed description of the pilot
program, including incentives and activities
undertaken by review board experts;
(D) a detailed compilation of results
achieved by the pilot program, including the
number of small business concerns included and
the number of business packages developed, and
the number of projects that progressed into
subsequent STTR phases; and
(E) an analysis of the program's
effectiveness with supporting data.
(7) Sunset.--The pilot program under this subsection
shall terminate at the end of fiscal year 2017.
(kk) Phase III Reporting.--The annual SBIR or STTR report to
Congress by the Administration under subsection (b)(7) shall
include, for each Phase III award--
(1) the name of the agency or component of the agency
or the non-Federal source of capital making the Phase
III award;
(2) the name of the small business concern or
individual receiving the Phase III award; and
(3) the dollar amount of the Phase III award.
(ll) Consent To Release Contact Information to
Organizations.--
(1) Enabling concern to give consent.--Each Federal
agency required by this section to conduct an SBIR
program or an STTR program shall enable a small
business concern that is an SBIR applicant or an STTR
applicant to indicate to the Federal agency whether the
Federal agency has the consent of the concern to--
(A) identify the concern to appropriate local
and State-level economic development
organizations as an SBIR applicant or an STTR
applicant; and
(B) release the contact information of the
concern to such organizations.
(2) Rules.--The Administrator shall establish rules
to implement this subsection. The rules shall include a
requirement that a Federal agency include in the SBIR
and STTR application a provision through which the
applicant can indicate consent for purposes of
paragraph (1).
(mm) Assistance for Administrative, Oversight, and Contract
Processing Costs.--
(1) In general.--Subject to paragraph (3) and until
[September 30, 2017] September 30, 2022, the
Administrator shall allow each Federal agency required
to conduct an SBIR program to use not more than 3
percent of the funds allocated to the SBIR program of
the Federal agency for--
(A) the administration of the SBIR program or
the STTR program of the Federal agency;
(B) the provision of outreach and technical
assistance relating to the SBIR program or STTR
program of the Federal agency, including
technical assistance site visits, personnel
interviews, and national conferences;
(C) the implementation of commercialization
and outreach initiatives that were not in
effect on the date of enactment of this
subsection;
(D) carrying out the program under subsection
(y);
(E) activities relating to oversight and
congressional reporting, including waste,
fraud, and abuse prevention activities;
(F) targeted reviews of recipients of awards
under the SBIR program or STTR program of the
Federal agency that the head of the Federal
agency determines are at high risk for fraud,
waste, or abuse to ensure compliance with
requirements of the SBIR program or STTR
program, respectively;
(G) the implementation of oversight and
quality control measures, including
verification of reports and invoices and cost
reviews;
(H) carrying out subsection (dd);
(I) contract processing costs relating to the
SBIR program or STTR program of the Federal
agency; [and]
(J) funding for additional personnel and
assistance with application reviews[.]; and
(K) the annual meeting required under
subsection (tt).
[(2) Outreach and technical assistance.--
[(A) In general.--Except as provided in
subparagraph (B), a Federal agency
participating in the program under this
subsection shall use a portion of the funds
authorized for uses under paragraph (1) to
carry out the policy directive required under
subsection (j)(2)(F) and to increase the
participation of States with respect to which a
low level of SBIR awards have historically been
awarded.
[(B) Waiver.--A Federal agency may request
the Administrator to waive the requirement
contained in subparagraph (A). Such request
shall include an explanation of why the waiver
is necessary. The Administrator may grant the
waiver based on a determination that the agency
has demonstrated a sufficient need for the
waiver, that the outreach objectives of the
agency are being met, and that there is
increased participation by States with respect
to which a low level of SBIR awards have
historically been awarded.]
(2) Outreach and technical assistance.--A Federal
agency participating in the program under this
subsection shall use a portion of the funds authorized
for uses under paragraph (1) to carry out the policy
directive required under subsection (j)(2)(F) and to
increase the participation of States with respect to
which a low level of SBIR awards have historically been
awarded.
(3) Performance criteria.--A Federal agency may not
use funds as authorized under paragraph (1) until after
the effective date of performance criteria, which the
Administrator shall establish, to measure any benefits
of using funds as authorized under paragraph (1) and to
assess continuation of the authority under paragraph
(1).
(4) Rules.--Not later than 180 days after the date of
enactment of this subsection, the Administrator shall
issue rules to carry out this subsection.
(5) Coordination with ig.--Each Federal agency shall
coordinate the activities funded under subparagraph
(E), (F), or (G) of paragraph (1) with their respective
Inspectors General, when appropriate, and each Federal
agency that allocates more than $50,000,000 to the SBIR
program of the Federal agency for a fiscal year may
share such funding with its Inspector General when the
Inspector General performs such activities.
(6) Reporting.--The Administrator shall collect data
and provide to the Committee on Small Business and
Entrepreneurship of the Senate and the Committee on
Small Business, the Committee on Science, Space, and
Technology, and the Committee on Appropriations of the
House of Representatives a report on the use of funds
under this subsection, including funds used to achieve
the objectives of [paragraph (2)(A) and any use of the
waiver authority under paragraph (2)(B)] paragraph (2).
(nn) Annual Report on SBIR and STTR Program Goals.--
(1) Development of metrics.--The head of each Federal
agency required to participate in the SBIR program or
the STTR program shall develop metrics to evaluate the
effectiveness and the benefit to the people of the
United States of the SBIR program and the STTR program
of the Federal agency that--
(A) are science-based and statistically
driven;
(B) reflect the mission of the Federal
agency; and
(C) include factors relating to the economic
impact of the programs.
(2) Evaluation.--The head of each Federal agency
described in paragraph (1) shall conduct an annual
evaluation using the metrics developed under paragraph
(1) of--
(A) the SBIR program and the STTR program of
the Federal agency; and
(B) the benefits to the people of the United
States of the SBIR program and the STTR program
of the Federal agency.
(3) Report.--
(A) In general.--The head of each Federal
agency described in paragraph (1) shall submit
to the appropriate committees of Congress and
the Administrator an annual report describing
in detail the results of an evaluation
conducted under paragraph (2).
(B) Public availability of report.--The head
of each Federal agency described in paragraph
(1) shall make each report submitted under
subparagraph (A) available to the public
online.
(C) Definition.--In this paragraph, the term
``appropriate committees of Congress'' means--
(i) the Committee on Small Business
and Entrepreneurship of the Senate; and
(ii) the Committee on Small Business
and the Committee on Science, Space,
and Technology of the House of
Representatives.
(oo) Competitive Selection Procedures for SBIR and STTR
Programs.--All funds awarded, appropriated, or otherwise made
available in accordance with subsection (f) or (n) must be
awarded pursuant to competitive and merit-based selection
procedures.
(pp) Limitation on Pilot Programs.--
(1) Existing pilot programs.--The Administrator may
only carry out a covered pilot program that is in
operation on the date of enactment of this subsection
during the 3-year period beginning on such date of
enactment.
(2) New pilot programs.--The Administrator may only
carry out a covered pilot program established after the
date of enactment of this subsection--
(A) during the 3-year period beginning on the
date on which such program is established; and
(B) if such program does not continue and is
not based on, in any manner, a previously
established covered pilot program.
(3) Covered pilot program defined.--In this
subsection, the term ``covered pilot program'' means
any initiative, project, innovation, or other
activity--
(A) established by the Administrator;
(B) relating to an SBIR or STTR program; and
(C) not specifically authorized by law.
(qq) Minimum Standards for Participation.--
(1) Progress to phase ii success.--
(A) Establishment of system and minimum
commercialization rate.--Not later than 1 year
after the date of enactment of this subsection,
the head of each Federal agency participating
in the SBIR or STTR program shall--
(i) establish a system to measure,
where appropriate, the success of small
business concerns with respect to the
receipt of Phase II SBIR or STTR awards
for projects that have received Phase I
SBIR or STTR awards;
(ii) establish a minimum performance
standard for small business concerns
with respect to the receipt of Phase II
SBIR or STTR awards for projects that
have received Phase I SBIR or STTR
awards; and
(iii) begin evaluating, each fiscal
year, whether each small business
concern that received a Phase I SBIR or
STTR award from the agency meets the
minimum performance standard
established under clause (ii).
(B) Consequence of failure to meet minimum
commercialization rate.--If the head of a
Federal agency determines that a small business
concern that received a Phase I SBIR or STTR
award from the agency is not meeting the
minimum performance standard established under
subparagraph (A)(ii), such concern may not
participate in Phase I (or Phase II if under
the authority of subsection (cc)) of the SBIR
or STTR program of that agency during the 1-
year period beginning on the date on which such
determination is made.
(2) Progress to phase iii success.--
(A) Establishment of system and minimum
commercialization rate.--Not later than 2 years
after the date of enactment of this subsection,
the head of each Federal agency participating
in the SBIR or STTR program shall--
(i) establish a system to measure,
where appropriate, the success of small
business concerns with respect to the
receipt of Phase III SBIR or STTR
awards for projects that have received
Phase I SBIR or STTR awards;
(ii) establish a minimum performance
standard for small business concerns
with respect to the receipt of Phase
III SBIR or STTR awards for projects
that have received Phase I SBIR or STTR
awards; and
(iii) begin evaluating, each fiscal
year, whether each small business
concern that received a Phase I SBIR or
STTR award from the agency meets the
minimum performance standard
established under clause (ii).
(B) Consequence of failure to meet minimum
commercialization rate.--If the head of a
Federal agency determines that a small business
concern that received a Phase I SBIR or STTR
award from the agency is not meeting the
minimum performance standard established under
subparagraph (A)(ii), such concern may not
participate in Phase I (or Phase II if under
the authority of subsection (cc)) of the SBIR
or STTR program of that agency during the 1-
year period beginning on the date on which such
determination is made.
(3) Administration oversight.--
(A) Approval and publication of systems and
minimum performance standards.--Each system and
minimum performance standard established under
paragraph (1) or paragraph (2) shall be
submitted by the head of the applicable Federal
agency to the Administrator and shall be
subject to the approval of the Administrator.
In making a determination with respect to
approval, the Administrator shall ensure that
the minimum performance standard exceeds a de
minimis level. The Administrator shall publish
on the Internet Web site of the Administration
the systems and minimum performance standards
approved.
(B) Submission of evaluation results by
agency.--The head of each covered Federal
agency shall submit to the Administrator the
results of each evaluation conducted under
paragraph (1) or paragraph (2).
(4) Requirement of notice and comment.--Each system
and minimum performance standard established under
paragraph (1) or paragraph (2) and each approval
provided by the Administrator under paragraph (3)(A),
at least 60 days before becoming effective, shall be
preceded by the provision of notice of and an
opportunity for public comment on such system,
standard, or approval.
(rr) Publication of Certain Information.--In order to
increase the number of small businesses receiving awards under
the SBIR or STTR programs of participating agencies, and to
simplify the application process for such awards, the
Administrator shall establish and maintain a public Internet
Web site on which the Administrator shall publish such
information relating to notice of and application for awards
under the SBIR program and STTR program of each participating
Federal agency as the Administrator determines appropriate.
(ss) Report on Enhancement of Manufacturing Activities.--Not
later than October 1, 2013, and annually thereafter, the head
of each Federal agency that makes more than $50,000,000 in
awards under the SBIR and STTR programs of the agency combined
shall submit to the Administrator, for inclusion in the annual
report required under subsection (b)(7), information that
includes--
(1) a description of efforts undertaken by the head
of the Federal agency to enhance United States
manufacturing activities;
(2) a comprehensive description of the actions
undertaken each year by the head of the Federal agency
in carrying out the SBIR or STTR program of the agency
in support of Executive Order 13329 (69 Fed. Reg. 9181;
relating to encouraging innovation in manufacturing);
(3) an assessment of the effectiveness of the actions
described in paragraph (2) at enhancing the research
and development of United States manufacturing
technologies and processes;
(4) a description of efforts by vendors selected to
provide discretionary technical assistance under
subsection (q)(1) to help SBIR and STTR concerns
manufacture in the United States; and
(5) recommendations that the program managers of the
SBIR or STTR program of the agency consider appropriate
for additional actions to increase the effectiveness of
enhancing manufacturing activities.
(tt) Annual Meeting.--
(1) In general.--The head of each Federal agency
required to have a program under this section (or a
designee) and the Administrator (or a designee) shall
meet annually to discuss methods--
(A) to improve the collection of data under
this section;
(B) to improve the reporting of data to the
Administrator under this section;
(C) to make the application processes for
programs under this section more efficient; and
(D) to increase participation in the programs
established under this section.
(2) Report.--Not later than 60 days after the date on
which an annual meeting required under paragraph (1) is
held, the Administrator shall submit to the Committee
on Small Business and Entrepreneurship of the Senate
and the Committee on Small Business and the Committee
on Science, Space, and Technology of the House of
Representatives, a report on the findings of such
meeting and recommendations on how to implement changes
to programs under this section.
(uu) Commercialization Assistance Pilot Programs.--
(1) Pilot programs implemented.--
(A) In general.--Except as provided in
subparagraph (B), not later than one year after
the date of the enactment of this subsection, a
covered agency shall implement a
commercialization assistance pilot program,
under which an eligible entity may receive a
subsequent Phase II SBIR award.
(B) Exception.--If the Administrator
determines that a covered agency has a program
that is sufficiently similar to the
commercialization assistance pilot program
established under this subsection, such covered
agency shall not be required to implement a
commercialization assistance pilot program
under this subsection.
(2) Percent of agency funds.--The head of each
covered agency may allocate not more than 5 percent of
the funds allocated to the SBIR program of the covered
agency for the purpose of making a subsequent Phase II
SBIR award under the commercialization assistance pilot
program.
(3) Termination.--A commercialization assistance
pilot program established under this subsection shall
terminate on September 30, 2022.
(4) Application.--To be selected to receive a
subsequent Phase II SBIR award under a
commercialization assistance pilot program, an eligible
entity shall submit to the covered agency implementing
such pilot program an application at such time, in such
manner, and containing such information as the covered
agency may require, including--
(A) an updated Phase II commercialization
plan; and
(B) the source and amount of the matching
funding required under paragraph (5).
(5) Matching funding.--
(A) In general.--The Administrator shall
require, as a condition of any subsequent Phase
II SBIR award made to an eligible entity under
this subsection, that a matching amount
(excluding any fees collected by the eligible
entity receiving such award) equal to the
amount of such award be provided from an
eligible third-party investor.
(B) Ineligible sources.--An eligible entity
may not use funding from ineligible sources to
meet the matching requirement of subparagraph
(A).
(6) Award.--A subsequent Phase II SBIR award made to
an eligible entity under this subsection--
(A) may not exceed the limitation described
under subsection (aa)(1); and
(B) shall be disbursed during Phase II.
(7) Use of funds.--The funds awarded to an eligible
entity under this subsection may only be used for
research and development activities that build on
eligible entity's Phase II program and ensure the
research funded under such Phase II is rapidly
progressing towards commercialization.
(8) Selection.--In selecting eligible entities to
participate in a commercialization assistance pilot
program under this subsection, the head of a covered
agency shall consider--
(A) the extent to which such award could aid
the eligible entity in commercializing the
research funded under the eligible entity's
Phase II program;
(B) whether the updated Phase II
commercialization plan submitted under
paragraph (4) provides a sound approach for
establishing technical feasibility that could
lead to commercialization of such research;
(C) whether the proposed activities to be
conducted under such updated Phase II
commercialization plan further improve the
likelihood that such research will provide
societal benefits;
(D) whether the small business concern has
progressed satisfactorily in Phase II to
justify receipt of a subsequent Phase II SBIR
award;
(E) the expectations of the eligible third-
party investor that provides matching funding
under paragraph (5); and
(F) the likelihood that the proposed
activities to be conducted under such updated
Phase II commercialization plan using matching
funding provided by such eligible third-party
investor will lead to commercial and societal
benefit.
(9) Evaluation report.--Not later than 3 years after
the date of the enactment of this subsection, the
Comptroller General of the United States shall submit
to the Committee on Science, Space, and Technology and
the Committee on Small Business of the House of
Representatives, and the Committee on Small Business
and Entrepreneurship of the Senate, a report
including--
(A) a summary of the activities of
commercialization assistance pilot programs
carried out under this subsection;
(B) a detailed compilation of results
achieved by such commercialization assistance
pilot programs, including the number of
eligible entities that received awards under
such programs;
(C) the rate at which each eligible entity
that received a subsequent Phase II SBIR award
under this subsection commercialized research
of the recipient;
(D) the growth in employment and revenue of
eligible entities that is attributable to
participation in a commercialization assistance
pilot program;
(E) a comparison of commercialization success
of eligible entities participating in a
commercialization assistance pilot program with
recipients of an additional Phase II SBIR award
under subsection (ff);
(F) demographic information, such as
ethnicity and geographic location, of eligible
entities participating in a commercialization
assistance pilot program;
(G) an accounting of the funds used at each
covered agency that implements a
commercialization assistance pilot program
under this subsection;
(H) the amount of matching funding provided
by eligible third-party investors, set forth
separately by source of funding;
(I) an analysis of the effectiveness of the
commercialization assistance pilot program
implemented by each covered agency; and
(J) recommendations for improvements to the
commercialization assistance pilot program.
(10) Definitions.--For purposes of this subsection:
(A) Covered agency.--The term ``covered
agency'' means a Federal agency required to
have an SBIR program.
(B) Eligible entity.--The term ``eligible
entity'' means a small business concern that
has received a Phase II award under an SBIR
program and an additional Phase II SBIR award
under subsection (ff) from the covered agency
to which such small business concern is
applying for a subsequent Phase II SBIR award.
(C) Eligible third-party investor.--The term
``eligible third-party investor'' means a small
business concern other than an eligible entity,
a venture capital firm, an individual investor,
a non-SBIR Federal, State or local government,
or any combination thereof.
(D) Ineligible sources.--The term
``ineligible sources'' means the following:
(i) The eligible entity's internal
research and development funds.
(ii) Funding in forms other than
cash, such as in-kind or other
intangible assets.
(iii) Funding from the owners of the
eligible entity, or the family members
or affiliates of such owners.
(iv) Funding attained through loans
or other forms of debt obligations.
(E) Subsequent phase ii sbir award.--The term
``subsequent Phase II SBIR award'' means an
award granted to an eligible entity under this
subsection to carry out further
commercialization activities for research
conducted pursuant to an SBIR program.
* * * * * * *
Sec. 15.
(a) Small Business Procurements.--
(1) In general.--For purposes of this Act, small
business concerns shall receive any award or contract
if such award or contract is, in the determination of
the Administrator and the contracting agency, in the
interest of--
(A) maintaining or mobilizing the full
productive capacity of the United States;
(B) war or national defense programs; or
(C) assuring that a fair proportion of the
total purchase and contracts for goods and
services of the Government in each industry
category (as defined under paragraph (2)) are
awarded to small business concerns.
(2) Industry category defined.--
(A) In general.--In this subsection, the term
``industry category'' means a discrete group of
similar goods and services, as determined by
the Administrator in accordance with the North
American Industry Classification System codes
used to establish small business size
standards, except that the Administrator shall
limit an industry category to a greater extent
than provided under the North American Industry
Classification System codes if the
Administrator receives evidence indicating that
further segmentation of the industry category
is warranted--
(i) due to special capital equipment
needs;
(ii) due to special labor
requirements;
(iii) due to special geographic
requirements, except as provided in
subparagraph (B);
(iv) due to unique Federal buying
patterns or requirements; or
(v) to recognize a new industry.
(B) Exception for geographic requirements.--
The Administrator may not further segment an
industry category based on geographic
requirements unless--
(i) the Government typically
designates the geographic area where
work for contracts for goods or
services is to be performed;
(ii) Government purchases comprise
the major portion of the entire
domestic market for such goods or
services; and
(iii) it is unreasonable to expect
competition from business concerns
located outside of the general
geographic area due to the fixed
location of facilities, high
mobilization costs, or similar economic
factors.
(3) Determinations with respect to awards or
contracts.--Determinations made pursuant to paragraph
(1) may be made for individual awards or contracts, any
part of an award or contract or task order, or for
classes of awards or contracts or task orders.
(4) Increasing prime contracting opportunities for
small business concerns.--
(A) Description of covered proposed
procurements.--The requirements of this
paragraph shall apply to a proposed procurement
that includes in its statement of work goods or
services currently being supplied or performed
by a small business concern and, as determined
by the Administrator--
(i) is in a quantity or of an
estimated dollar value which makes the
participation of a small business
concern as a prime contractor unlikely;
(ii) in the case of a proposed
procurement for construction, seeks to
bundle or consolidate discrete
construction projects; or
(iii) is a solicitation that involves
an unnecessary or unjustified bundling
of contract requirements.
(B) Notice to procurement center
representatives.--With respect to proposed
procurements described in subparagraph (A), at
least 30 days before issuing a solicitation and
concurrent with other processing steps required
before issuing the solicitation, the
contracting agency shall provide a copy of the
proposed procurement to the procurement center
representative of the contracting agency (as
described in subsection (l)) along with a
statement explaining--
(i) why the proposed procurement
cannot be divided into reasonably small
lots (not less than economic production
runs) to permit offers on quantities
less than the total requirement;
(ii) why delivery schedules cannot be
established on a realistic basis that
will encourage the participation of
small business concerns in a manner
consistent with the actual requirements
of the Government;
(iii) why the proposed procurement
cannot be offered to increase the
likelihood of the participation of
small business concerns;
(iv) in the case of a proposed
procurement for construction, why the
proposed procurement cannot be offered
as separate discrete projects; or
(v) why the contracting agency has
determined that the bundling of
contract requirements is necessary and
justified.
(C) Alternatives to increase prime
contracting opportunities for small business
concerns.--If the procurement center
representative believes that the proposed
procurement will make the participation of
small business concerns as prime contractors
unlikely, the procurement center
representative, within 15 days after receiving
the statement described in subparagraph (B),
shall recommend to the contracting agency
alternative procurement methods for increasing
prime contracting opportunities for small
business concerns.
(D) Failure to agree on an alternative
procurement method.--If the procurement center
representative and the contracting agency fail
to agree on an alternative procurement method,
the Administrator shall submit the matter to
the head of the appropriate department or
agency for a determination.
(5) Contracts for sale of Government property.--With
respect to a contract for the sale of Government
property, small business concerns shall receive any
such contract if, in the determination of the
Administrator and the disposal agency, the award of
such contract is in the interest of assuring that a
fair proportion of the total sales of Government
property be made to small business concerns.
(6) Sale of electrical power or other property.--
Nothing in this subsection shall be construed to change
any preferences or priorities established by law with
respect to the sale of electrical power or other
property by the Federal Government.
(7) Costs exceeding fair market price.--A contract
may not be awarded under this subsection if the cost of
the contract to the awarding agency exceeds a fair
market price.
(b) With respect to any work to be performed the amount of
which would exceed the maximum amount of any contract for which
a surety may be guaranteed against loss under section 411 of
the Small Business Investment Act of 1958 (15 U.S.C. 694(b)),
the contracting procurement agency shall, to the extent
practicable, place contracts so as to allow more than one small
business concern to perform such work.
(c)(1) As used in this subsection:
(A) The term ``Committee'' means the Committee for
Purchase from the Blind and Other Severely Handicapped
established under the first section of the Act entitled
``An Act to create a Committee on Purchases of Blind-
made Products, and for other purposes'', approved June
25, 1938 (41 U.S.C. 46).
(B) The term ``public or private organization for the
handicapped'' has the same meaning given such term in
section 3(e).
(C) The term ``handicapped individual'' has the same
meaning given such term in section 3(f).
(2)(A) During fiscal year 1995, public or private
organizations for the handicapped shall be eligible to
participate in programs authorized under this section in an
aggregate amount not to exceed $40,000,000.
(B) None of the amounts authorized for participation by
subparagraph (A) may be placed on the procurement list
maintained by the Committee pursuant to section 2 of the Act
entitled ``An Act to create a Committee on Purchases of Blind-
made Products, and for other purposes'', approved June 25, 1938
(41 U.S.C. 47).
(3) The Administrator shall monitor and evaluate such
participation.
(4)(A) Not later than ten days after the announcement of a
proposed award of a contract by an agency or department to a
public or private organization for the handicapped, a for-
profit small business concern that has experienced or is likely
to experience severe economic injury as the result of the
proposed award may file an appeal of the proposed award with
the Administrator.
(B) If such a concern files an appeal of a proposed award
under subparagraph (A) and the Administrator, after
consultation with the Executive Director of the Committee,
finds that the concern has experienced or is likely to
experience severe economic injury as the result of the proposed
award, not later than thirty days after the filing of the
appeal, the Administration shall require each agency and
department having procurement powers to take such action as may
be appropriate to alleviate economic injury sustained or likely
to be sustained by the concern.
(5) Each agency and department having procurement powers
shall report to the Office of Federal Procurement Policy each
time a contract subject to paragraph (2)(A) is entered into,
and shall include in its report the amount of the next higher
bid submitted by a for-profit small business concern. The
Office of Federal Procurement Policy shall collect data
reported under the preceding sentence through the Federal
procurement data system and shall report to the Administration
which shall notify all such agencies and departments when the
maximum amount of awards authorized under paragraph (2)(A) has
been made during any fiscal year.
(6) For the purpose of this subsection, a contract may be
awarded only if at least 75 per centum of the direct labor
performed on each item being produced under the contract in the
sheltered workshop or performed in providing each type of
service under the contract by the sheltered workshop is
performed by handicapped individuals.
(7) Agencies awarding one or more contracts to such an
organization pursuant to the provisions of this subsection may
use multiyear contracts, if appropriate.
(d) For purposes of this section priority shall be given to
the awarding of contracts and the placement of subcontracts to
small business concerns which shall perform a substantial
proportion of the production on those contracts and
subcontracts within areas of concentrated unemployment or
underemployment or within labor surplus areas. Notwithstanding
any other provison of law, total labor surplus area set-asides
pursuant to Defense Manpower Policy Number 4 (32A C.F.R.
Chapter 1) or any successor policy shall be authorized if the
Secretary or his designee specifically determines that there is
a reasonable expectation that offers will be obtained from a
sufficient number of eligible concerns so that awards will be
made at reasonable prices. As soon as practicable and to the
extent possible, in determining labor surplus areas,
consideration shall be given to those persons who would be
available for employment were suitable employment available.
Until such definition reflects such number, the present
criteria of such policy shall govern.
(e) Procurement Strategies; Contract Bundling.--
(1) In general.--To the maximum extent practicable,
procurement strategies used by a Federal department or
agency having contracting authority shall facilitate
the maximum participation of small business concerns as
prime contractors, subcontractors, and suppliers, and
each such Federal department or agency shall--
(A) provide opportunities for the
participation of small business concerns during
acquisition planning processes and in
acquisition plans; and
(B) invite the participation of the
appropriate Director of Small and Disadvantaged
Business Utilization in acquisition planning
processes and provide that Director access to
acquisition plans.
(2) Market research.--
(A) In general.--Before proceeding with an
acquisition strategy that could lead to a
contract containing consolidated procurement
requirements, the head of an agency shall
conduct market research to determine whether
consolidation of the requirements is necessary
and justified.
(B) Factors.--For purposes of subparagraph
(A), consolidation of the requirements may be
determined as being necessary and justified if,
as compared to the benefits that would be
derived from contracting to meet those
requirements if not consolidated, the Federal
Government would derive from the consolidation
measurably substantial benefits, including any
combination of benefits that, in combination,
are measurably substantial. Benefits described
in the preceding sentence may include the
following:
(i) Cost savings.
(ii) Quality improvements.
(iii) Reduction in acquisition cycle
times.
(iv) Better terms and conditions.
(v) Any other benefits.
(C) Reduction of costs not determinative.--
The reduction of administrative or personnel
costs alone shall not be a justification for
bundling of contract requirements unless the
cost savings are expected to be substantial in
relation to the dollar value of the procurement
requirements to be consolidated.
(3) Strategy specifications.--If the head of a
contracting agency determines that an acquisition plan
for a procurement involves a substantial bundling of
contract requirements, the head of a contracting agency
shall publish a notice on a public website that such
determination has been made not later than 7 days after
making such determination. Any solicitation for a
procurement related to the acquisition plan may not be
published earlier than 7 days after such notice is
published. Along with the publication of the
solicitation, the head of a contracting agency shall
publish a justification for the determination, which
shall include the following information:
(A) The specific benefits anticipated to be
derived from the bundling of contract
requirements and a determination that such
benefits justify the bundling.
(B) An identification of any alternative
contracting approaches that would involve a
lesser degree of bundling of contract
requirements.
(C) An assessment of--
(i) the specific impediments to
participation by small business
concerns as prime contractors that
result from the bundling of contract
requirements; and
(ii) the specific actions designed to
maximize participation of small
business concerns as subcontractors
(including suppliers) at various tiers
under the contract or contracts that
are awarded to meet the requirements.
(4) Contract teaming.--
(A) In general.--In the case of a
solicitation of offers for a bundled or
consolidated contract that is issued by the
head of an agency, a small business concern
that provides for use of a particular team of
subcontractors or a joint venture of small
business concerns may submit an offer for the
performance of the contract.
(B) Evaluation of offers.--The head of the
agency shall evaluate an offer described in
subparagraph (A) in the same manner as other
offers, with due consideration to the
capabilities of all of the proposed
subcontractors or members of the joint venture
as follows:
(i) Teams.--When evaluating an offer
of a small business prime contractor
that includes a proposed team of small
business subcontractors, the head of
the agency shall consider the
capabilities and past performance of
each first tier subcontractor that is
part of the team as the capabilities
and past performance of the small
business prime contractor.
(ii) Joint ventures.--When evaluating
an offer of a joint venture of small
business concerns, if the joint venture
does not demonstrate sufficient
capabilities or past performance to be
considered for award of a contract
opportunity, the head of the agency
shall consider the capabilities and
past performance of each member of the
joint venture as the capabilities and
past performance of the joint venture.
(C) Status as a small business concern.--
Participation of a small business concern in a
team or a joint venture under this paragraph
shall not affect the status of that concern as
a small business concern for any other purpose.
(f) Contracting Preference for Small Business Concerns in a
Major Disaster Area.--
(1) Definition.--In this subsection, the term
``disaster area'' means the area for which the
President has declared a major disaster, during the
period of the declaration.
(2) Contracting preference.--An agency shall provide
a contracting preference for a small business concern
located in a disaster area if the small business
concern will perform the work required under the
contract in the disaster area.
(3) Credit for meeting contracting goals.--If an
agency awards a contract to a small business concern
under the circumstances described in paragraph (2), the
value of the contract shall be doubled for purposes of
determining compliance with the goals for procurement
contracts under subsection (g)(1)(A).
(g)
(1) Governmentwide goals.--
(A) Establishment.--The President shall
annually establish Governmentwide goals for
procurement contracts awarded to small business
concerns, small business concerns owned and
controlled by service-disabled veterans,
qualified HUBZone small business concerns,
small business concerns owned and controlled by
socially and economically disadvantaged
individuals, and small business concerns owned
and controlled by women in accordance with the
following:
(i) The Governmentwide goal for
participation by small business
concerns shall be established at not
less than 23 percent of the total value
of all prime contract awards for each
fiscal year. In meeting this goal, the
Government shall ensure the
participation of small business
concerns from a wide variety of
industries and from a broad spectrum of
small business concerns within each
industry.
(ii) The Governmentwide goal for
participation by small business
concerns owned and controlled by
service-disabled veterans shall be
established at not less than 3 percent
of the total value of all prime
contract and subcontract awards for
each fiscal year.
(iii) The Governmentwide goal for
participation by qualified HUBZone
small business concerns shall be
established at not less than 3 percent
of the total value of all prime
contract and subcontract awards for
each fiscal year.
(iv) The Governmentwide goal for
participation by small business
concerns owned and controlled by
socially and economically disadvantaged
individuals shall be established at not
less than 5 percent of the total value
of all prime contract and subcontract
awards for each fiscal year.
(v) The Governmentwide goal for
participation by small business
concerns owned and controlled by women
shall be established at not less than 5
percent of the total value of all prime
contract and subcontract awards for
each fiscal year.
(B) Achievement of governmentwide goals.--
Each agency shall have an annual goal that
presents, for that agency, the maximum
practicable opportunity for small business
concerns, small business concerns owned and
controlled by service-disabled veterans,
qualified HUBZone small business concerns,
small business concerns owned and controlled by
socially and economically disadvantaged
individuals, and small business concerns owned
and controlled by women to participate in the
performance of contracts let by such agency.
The Small Business Administration and the
Administrator for Federal Procurement Policy
shall, when exercising their authority pursuant
to paragraph (2), insure that the cumulative
annual prime contract goals for all agencies
meet or exceed the annual Governmentwide prime
contract goal established by the President
pursuant to this paragraph.
(2)(A) The head of each Federal agency shall, after
consultation with the Administration, establish goals for the
participation by small business concerns, by small business
concerns owned and controlled by service-disabled veterans, by
qualified HUBZone small business concerns, by small business
concerns owned and controlled by socially and economically
disadvantaged individuals, and by small business concerns owned
and controlled by women in procurement contracts of such
agency. Such goals shall separately address prime contract
awards and subcontract awards for each category of small
business covered.
(B) Goals established under this subsection shall be jointly
established by the Administration and the head of each Federal
agency and shall realistically reflect the potential of small
business concerns, small business concerns owned and controlled
by service-disabled veterans, qualified HUBZone small business
concerns, small business concerns owned and controlled by
socially and economically disadvantaged individuals, and small
business concerns owned and controlled by women to perform such
contracts and to perform subcontracts under such contracts.
(C) Whenever the Administration and the head of any Federal
agency fail to agree on established goals, the disagreement
shall be submitted to the Administrator for Federal Procurement
Policy for final determination.
(D) After establishing goals under this paragraph for a
fiscal year, the head of each Federal agency shall develop a
plan for achieving such goals at both the prime contract and
the subcontract level, which shall apportion responsibilities
among the agency's acquisition executives and officials. In
establishing goals under this paragraph, the head of each
Federal agency shall make a consistent effort to annually
expand participation by small business concerns from each
industry category in procurement contracts and subcontracts of
such agency, including participation by small business concerns
owned and controlled by service-disabled veterans, qualified
HUBZone small business concerns, small business concerns owned
and controlled by socially and economically disadvantaged
individuals, and small business concerns owned and controlled
by women.
(E) The head of each Federal agency, in attempting to
attain expanded participation under subparagraph (D),
shall consider--
(i) contracts awarded as the result of
unrestricted competition; and
(ii) contracts awarded after competition
restricted to eligible small business concerns
under this section and under the program
established under section 8(a).
(F)(i) Each procurement employee or program manager
described in clause (ii) shall communicate to the
subordinates of the procurement employee or program
manager the importance of achieving goals established
under subparagraph (A).
(ii) A procurement employee or program
manager described in this clause is a senior
procurement executive, senior program manager,
or Director of Small and Disadvantaged Business
Utilization of a Federal agency having
contracting authority.
(3) First tier subcontracts that are awarded by Management
and Operating contractors sponsored by the Department of Energy
to small business concerns, small businesses concerns owned and
controlled by service disabled veterans, qualified HUBZone
small business concerns, small business concerns owned and
controlled by socially and economically disadvantaged
individuals, and small business concerns owned and controlled
by women, shall be considered toward the annually established
agency and Government-wide goals for procurement contracts
awarded.
(h) Reporting on Goals for Procurement Contracts Awarded to
Small Business Concerns.--
(1) Agency reports.--At the conclusion of each fiscal
year, the head of each Federal agency shall submit to
the Administrator a report describing--
(A) the extent of the participation by small
business concerns, small business concerns
owned and controlled by veterans (including
service-disabled veterans), qualified HUBZone
small business concerns, small business
concerns owned and controlled by socially and
economically disadvantaged individuals, and
small business concerns owned and controlled by
women in the procurement contracts of such
agency during such fiscal year;
(B) whether the agency achieved the goals
established for the agency under subsection
(g)(2) with respect to such fiscal year;
(C) any justifications for a failure to
achieve such goals; and
(D) a remediation plan with proposed new
practices to better meet such goals, including
analysis of factors leading to any failure to
achieve such goals.
(2) Reports by administrator.--Not later than 60 days
after receiving a report from each Federal agency under
paragraph (1) with respect to a fiscal year, the
Administrator shall submit to the President and
Congress, and to make available on a public Web site, a
report that includes--
(A) a copy of each report submitted to the
Administrator under paragraph (1);
(B) a determination of whether each goal
established by the President under subsection
(g)(1) for such fiscal year was achieved;
(C) a determination of whether each goal
established by the head of a Federal agency
under subsection (g)(2) for such fiscal year
was achieved;
(D) the reasons for any failure to achieve a
goal established under paragraph (1) or (2) of
subsection (g) for such fiscal year and a
description of actions planned by the
applicable agency to address such failure,
including the Administrator's comments and
recommendations on the proposed remediation
plan; and
(E) for the Federal Government and each
Federal agency, an analysis of the number and
dollar amount of prime contracts awarded during
such fiscal year to--
(i) small business concerns--
(I) in the aggregate;
(II) through sole source
contracts;
(III) through competitions
restricted to small business
concerns; and
(IV) through unrestricted
competition;
(ii) small business concerns owned
and controlled by service-disabled
veterans--
(I) in the aggregate;
(II) through sole source
contracts;
(III) through competitions
restricted to small business
concerns;
(IV) through competitions
restricted to small business
concerns owned and controlled
by service-disabled veterans;
and
(V) through unrestricted
competition;
(iii) qualified HUBZone small
business concerns--
(I) in the aggregate;
(II) through sole source
contracts;
(III) through competitions
restricted to small business
concerns;
(IV) through competitions
restricted to qualified HUBZone
small business concerns;
(V) through unrestricted
competition where a price
evaluation preference was used;
and
(VI) through unrestricted
competition where a price
evaluation preference was not
used;
(iv) small business concerns owned
and controlled by socially and
economically disadvantaged
individuals--
(I) in the aggregate;
(II) through sole source
contracts;
(III) through competitions
restricted to small business
concerns;
(IV) through competitions
restricted to small business
concerns owned and controlled
by socially and economically
disadvantaged individuals;
(V) through unrestricted
competition; and
(VI) by reason of that
concern's certification as a
small business owned and
controlled by socially and
economically disadvantaged
individuals;
(v) small business concerns owned by
an Indian tribe (as such term is
defined in section 8(a)(13)) other than
an Alaska Native Corporation--
(I) in the aggregate;
(II) through sole source
contracts;
(III) through competitions
restricted to small business
concerns;
(IV) through competitions
restricted to small business
concerns owned and controlled
by socially and economically
disadvantaged individuals; and
(V) through unrestricted
competition;
(vi) small business concerns owned by
a Native Hawaiian Organization--
(I) in the aggregate;
(II) through sole source
contracts;
(III) through competitions
restricted to small business
concerns;
(IV) through competitions
restricted to small business
concerns owned and controlled
by socially and economically
disadvantaged individuals; and
(V) through unrestricted
competition;
(vii) small business concerns owned
by an Alaska Native Corporation--
(I) in the aggregate;
(II) through sole source
contracts;
(III) through competitions
restricted to small business
concerns;
(IV) through competitions
restricted to small business
concerns owned and controlled
by socially and economically
disadvantaged individuals; and
(V) through unrestricted
competition; and
(viii) small business concerns owned
and controlled by women--
(I) in the aggregate;
(II) through competitions
restricted to small business
concerns;
(III) through competitions
restricted using the authority
under section 8(m)(2);
(IV) through competitions
restricted using the authority
under section 8(m)(2) and in
which the waiver authority
under section 8(m)(3) was used;
(V) through sole source
contracts awarded using the
authority under subsection
8(m)(7);
(VI) through sole source
contracts awarded using the
authority under section
8(m)(8);
(VII) by industry for
contracts described in
subclause (III), (IV), (V), or
(VI); and
(VIII) through unrestricted
competition; and
(F) for the Federal Government, the number,
dollar amount, and distribution with respect to
the North American Industry Classification
System of subcontracts awarded during such
fiscal year to small business concerns, small
business concerns owned and controlled by
service-disabled veterans, qualified HUBZone
small business concerns, small business
concerns owned and controlled by socially and
economically disadvantaged individuals, and
small business concerns owned and controlled by
women, provided that such information is
publicly available through data systems
developed pursuant to the Federal Funding
Accountability and Transparency Act of 2006
(Public Law 109-282), or otherwise available as
provided in paragraph (3).
(3) Procurement data.--
(A) Federal procurement data system.--
(i) In general.--To assist in the
implementation of this section, the
Administrator shall have access to
information collected through the
Federal Procurement Data System,
Federal Subcontracting Reporting
System, or any new or successor system.
(ii) GSA report.--On the date that
the Administrator makes available the
report required under paragraph (2),
the Administrator of the General
Services Administration shall submit to
the President and Congress, and shall
make available on a public website, a
report in the same form and manner, and
including the same information, as the
report required under paragraph (2).
The report shall include all
procurements made for the period
covered by the report and may not
exclude any contract awarded.
(B) Agency procurement data sources.--To
assist in the implementation of this section,
the head of each contracting agency shall
provide, upon request of the Administrator,
procurement information collected through
agency data collection sources in existence at
the time of the request. Contracting agencies
shall not be required to establish new data
collection systems to provide such data.
(i) Nothing in this Act or any other provision of law
precludes exclusive small business set-asides for procurements
of architectural and engineering services, research,
development, test and evaluation, and each Federal agency is
authorized to develop such set-asides to further the interests
of small business in those areas.
(j)(1) Each contract for the purchase of goods and services
that has an anticipated value greater than $2,500 but not
greater than $100,000 shall be reserved exclusively for small
business concerns unless the contracting officer is unable to
obtain offers from two or more small business concerns that are
competitive with market prices and are competitive with regard
to the quality and delivery of the goods or services being
purchased.
(2) In carrying out paragraph (1), a contracting officer
shall consider a responsive offer timely received from an
eligible small business offeror.
(3) Nothing in paragraph (1) shall be construed as precluding
an award of a contract with a value not greater than $100,000
under the authority of subsection (a) of section 8 of this Act,
section 2323 of title 10, United States Code, section 712 of
the Business Opportunity Development Reform Act of 1988 (Public
Law 100-656; 15 U.S.C. 644 note), or section 7102 of the
Federal Acquisition Streamlining Act of 1994.
(k) There is hereby established in each Federal agency having
procurement powers an office to be known as the ``Office of
Small and Disadvantaged Business Utilization''. The management
of each such office shall be vested in an officer or employee
of such agency, with experience serving in any combination of
the following roles: program manager, deputy program manager,
or assistant program manager for Federal acquisition program;
chief engineer, systems engineer, assistant engineer, or
product support manager for Federal acquisition program;
Federal contracting officer; small business technical advisor;
contracts administrator for Federal Government contracts;
attorney specializing in Federal procurement law; small
business liaison officer; officer or employee who managed
Federal Government contracts for a small business; or
individual whose primary responsibilities were for the
functions and duties of section 8, 15, 31, 36, or 44 of this
Act. Such officer or employee--
(1) shall be known as the ``Director of Small and
Disadvantaged Business Utilization'' for such agency;
(2) shall be appointed by the head of such agency to
a position that is a Senior Executive Service position
(as such term is defined under section 3132(a) of title
5, United States Code), except that, for any agency in
which the positions of Chief Acquisition Officer and
senior procurement executive (as such terms are defined
under section 44(a) of this Act) are not Senior
Executive Service positions, the Director of Small and
Disadvantaged Business Utilization may be appointed to
a position compensated at not less than the minimum
rate of basic pay payable for grade GS-15 of the
General Schedule under section 5332 of such title
(including comparability payments under section 5304 of
such title);
(3) shall be responsible only to (including with
respect to performance appraisals), and report directly
and exclusively to, the head of such agency or to the
deputy of such head, except that the Director for the
Office of the Secretary of Defense shall be responsible
only to (including with respect to performance
appraisals), and report directly and exclusively to,
such Secretary or the Secretary's designee;
(4) shall be responsible for the implementation and
execution of the functions and duties under sections 8,
15, 31, 36, and 44 of this Act which relate to such
agency;
(5) shall identify proposed solicitations that
involve significant bundling of contract requirements,
and work with the agency acquisition officials and the
Administration to revise the procurement strategies for
such proposed solicitations where appropriate to
increase the probability of participation by small
businesses as prime contractors, or to facilitate small
business participation as subcontractors and suppliers,
if a solicitation for a bundled contract is to be
issued;
(6) shall assist small business concerns to obtain
payments, required late payment interest penalties, or
information regarding payments due to such concerns
from an executive agency or a contractor, in conformity
with chapter 39 of title 31, United States Code, or any
other protection for contractors or subcontractors
(including suppliers) that is included in the Federal
Acquisition Regulation or any individual agency
supplement to such Government-wide regulation;
(7) shall have supervisory authority over personnel
of such agency to the extent that the functions and
duties of such personnel relate to functions and duties
under sections 8, 15, 31, 36, and 44 of this Act;
(8) shall assign a small business technical adviser
to each office to which the Administration has assigned
a procurement center representative--
(A) who shall be a full-time employee of the
procuring activity and shall be well qualified,
technically trained and familiar with the
supplies or services purchased at the activity;
and
(B) whose principal duty shall be to assist
the Administration procurement center
representative in his duties and functions
relating to sections 8, 15, 31, 36, and 44 of
this Act,
(9) shall cooperate, and consult on a regular basis,
with the Administration with respect to carrying out
the functions and duties described in paragraph (4) of
this subsection;
(10) shall make recommendations to contracting
officers as to whether a particular contract
requirement should be awarded pursuant to subsection
(a), section 8, 15, 31, or 36 of this Act, or section
2323 of title 10, United States Code, which shall be
made with due regard to the requirements of subsection
(m), and the failure of the contracting officer to
accept any such recommendations shall be documented and
included within the appropriate contract file;
(11) shall review and advise such agency on any
decision to convert an activity performed by a small
business concern to an activity performed by a Federal
employee;
(12) shall provide to the Chief Acquisition Officer
and senior procurement executive of such agency advice
and comments on acquisition strategies, market
research, and justifications related to section 44 of
this Act;
(13) may provide training to small business concerns
and contract specialists, except that such training may
only be provided to the extent that the training does
not interfere with the Director carrying out other
responsibilities under this subsection;
(14) shall receive unsolicited proposals and, when
appropriate, forward such proposals to personnel of the
activity responsible for reviewing such proposals;
(15) shall carry out exclusively the duties
enumerated in this Act, and shall, while the Director,
not hold any other title, position, or responsibility,
except as necessary to carry out responsibilities under
this subsection;
(16) shall submit, each fiscal year, to the Committee
on Small Business of the House of Representatives and
the Committee on Small Business and Entrepreneurship of
the Senate a report describing--
(A) the training provided by the Director
under paragraph (13) in the most recently
completed fiscal year;
(B) the percentage of the budget of the
Director used for such training in the most
recently completed fiscal year;
(C) the percentage of the budget of the
Director used for travel in the most recently
completed fiscal year; and
(D) any failure of the agency to comply with
section 8, 15, 31, or 36;
(17) shall, when notified by a small business concern
prior to the award of a contract that the small
business concern believes that a solicitation, request
for proposal, or request for quotation unduly restricts
the ability of the small business concern to compete
for the award--
(A) submit the notice of the small business
concern to the contracting officer and, if
necessary, recommend ways in which the
solicitation, request for proposal, or request
for quotation may be altered to increase the
opportunity for competition;
(B) inform the advocate for competition of
such agency (as established under section 1705
of title 41, United States Code, or section
2318 of title 10, United States Code) of such
notice; and
(C) ensure that the small business concern is
aware of other resources and processes
available to address unduly restrictive
provisions in a solicitation, request for
proposal, or request for quotation, even if
such resources and processes are provided by
such agency, the Administration, the
Comptroller General, or a procurement technical
assistance program established under chapter
142 of title 10, United States Code;
(18) shall review summary data provided by purchase
card issuers of purchases made by the agency greater
than the micro-purchase threshold (as defined under
section 1902 of title 41, United Stated Code) and less
than the simplified acquisition threshold to ensure
that the purchases have been made in compliance with
the provisions of this Act and have been properly
recorded in the Federal Procurement Data System, if the
method of payment is a purchase card issued by the
Department of Defense pursuant to section 2784 of title
10, United States Code, or by the head of an executive
agency pursuant to section 1909 of title 41, United
States Code;
(19) shall provide assistance to a small business
concern awarded a contract or subcontract under this
Act or under title 10 or title 41, United States Code,
in finding resources for education and training on
compliance with contracting regulations (including the
Federal Acquisition Regulation) after award of such a
contract or subcontract; [and]
(20) shall review all subcontracting plans required
by paragraph (4) or (5) of section 8(d) to ensure that
the plan provides maximum practicable opportunity for
small business concerns to participate in the
performance of the contract to which the plan
applies[.];
(21) shall assist small business concerns
participating in a SBIR or STTR program under section 9
with researching applicable solicitations for the award
of a Federal contract (particularly with the Federal
agency that has a funding agreement (as defined under
section 9) with the concern) to market the research
developed by such concern under such SBIR or STTR
program; and
(22) shall provide technical assistance to small
business concerns participating in a SBIR or STTR
program under section 9 to submit a bid for an award of
a Federal contract, including coordination with
procurement center representatives and the appropriate
senior procurement executive for the agency letting the
contract.
This subsection shall not apply to the Administration.
(l) Procurement Center Representatives.--
(1) Assignment and role.--The Administrator shall
assign to each major procurement center a procurement
center representative with such assistance as may be
appropriate.
(2) Activities.--A procurement center representative
is authorized to--
(A) attend any provisioning conference or similar
evaluation session during which determinations are made
as to whether requirements are to be procured through
other than full and open competition and make
recommendations with respect to such requirements to
the members of such conference or session;
(B) review, at any time, barriers to small
business participation in Federal contracting
previously imposed on goods and services
through acquisition method coding or similar
procedures, and recommend to personnel of the
appropriate activity the prompt reevaluation of
such barriers;
(C) review barriers to small business
participation in Federal contracting arising
out of restrictions on the rights of the United
States in technical data, and, when
appropriate, recommend that personnel of the
appropriate activity initiate a review of the
validity of such an asserted restriction;
(D) review any bundled or consolidated
solicitation or contract in accordance with
this Act;
(E) have access to procurement records and
other data of the procurement center
commensurate with the level of such
representative's approved security clearance
classification, with such data provided upon
request in electronic format, when available;
(F) receive unsolicited proposals from small
business concerns and transmit such proposals
to personnel of the activity responsible for
reviewing such proposals, who shall furnish the
procurement center representative with
information regarding the disposition of any
such proposal;
(G) consult with the Director the Office of
Small and Disadvantaged Business Utilization of
that agency and the agency personnel described
in paragraph (7) and (8) of subsection (k) with
regard to agency insourcing decisions covered
by subsection (k)(11);
(H) be an advocate for the maximum
practicable utilization of small business
concerns in Federal contracting, including by
advocating against the consolidation or
bundling of contract requirements when not
justified;
(I) assist small business concerns with
finding resources for education and training on
compliance with contracting regulations
(including the Federal Acquisition Regulation)
after award of a contract or subcontract; [and]
(J) assist small business concerns
participating in a SBIR or STTR program under
section 9 with Phase III;
(K) coordinate with the appropriate
contracting officer and the appropriate
Director of the Office of Small and
Disadvantaged Business Utilization established
pursuant to subsection (k) for the agency
letting the contract; and
[(J)] (L) carry out any other responsibility
assigned by the Administrator.
(3) Appeals.--A procurement center representative is
authorized to appeal the failure to act favorably on
any recommendation made pursuant to paragraph (2). Such
appeal shall be filed and processed in the same manner
and subject to the same conditions and limitations as
an appeal filed by the Administrator pursuant to
subsection (a).
(4) The Administration shall assign and co-locate at
least two small business technical advisers to each
major procurement center in addition to such other
advisers as may be authorized from time to time. The
sole duties of such advisers shall be to assist the
procurement center representative for the center to
which such advisers are assigned in carrying out the
functions described in paragraph (2) and the
representatives referred to in subsection (k)(6).
(5) Position requirements.--
(A) In general.--A procurement center
representative assigned under this subsection
shall--
(i) be a full-time employee of the
Administration;
(ii) be fully qualified, technically
trained, and familiar with the goods
and services procured by the major
procurement center to which that
representative is assigned; and
(iii) have the certification
described in subparagraph (C).
(B) Compensation.--The Administrator shall
establish personnel positions for procurement
center representatives assigned under this
subsection, which are classified at a grade
level of the General Schedule sufficient to
attract and retain highly qualified personnel.
(C) Certification requirements.--
(i) In general.--Consistent with the
requirements of clause (ii), a
procurement center representative shall
have a Level III Federal Acquisition
Certification in Contracting (or any
successor certification) or the
equivalent Department of Defense
certification, except that any person
serving in such a position on or before
January 3, 2013, may continue to serve
in that position for a period of 5
years without the required
certification.
(ii) Delay of certification
requirements.--
(I) Timing.--The
certification described in
clause (i) is not required for
any person serving as a
procurement center
representative until the date
that is one calendar year after
the date such person is
appointed as a procurement
center representative.
(II) Application.--The
requirements of subclause (I)
shall--
(aa) be included in
any initial job posting
for the position of a
procurement center
representative; and
(bb) apply to any
person appointed as a
procurement center
representative after
January 3, 2013.
(6) Major procurement center defined.--For purposes
of this subsection, the term ``major procurement
center'' means a procurement center that, in the
opinion of the Administrator, purchases substantial
dollar amounts of goods or services, including goods or
services that are commercially available.
(7) Training.--
(A) Authorization.--At such times as the
Administrator deems appropriate, the breakout
procurement center representative shall conduct
familiarization sessions for contracting
officers and other appropriate personnel of the
procurement center to which such representative
is assigned. Such sessions shall acquaint the
participants with the provisions of this
subsection and shall instruct them in methods
designed to further the purposes of such
subsection.
(B) Limitation.--A procurement center
representative may provide training under
subparagraph
(A) only to the extent that the training does not interfere
with the representative carrying out other activities under
this subsection.
(8) Annual briefing and report.--A procurement center
representative shall prepare and personally deliver an
annual briefing and report to the head of the
procurement center to which such representative is
assigned. Such briefing and report shall detail the
past and planned activities of the representative and
shall contain such recommendations for improvement in
the operation of the center as may be appropriate. The
head of such center shall personally receive such
briefing and report and shall, within 60 calendar days
after receipt, respond, in writing, to each
recommendation made by such representative.
(9) Scope of review.--The Administrator--
(A) may not limit the scope of review by the
procurement center representative for any
solicitation of a contract or task order
without regard to whether the contract or task
order or part of the contract or task order is
set aside for small business concerns, whether
1 or more contracts or task order awards are
reserved for small business concerns under a
multiple award contract, or whether or not the
solicitation would result in a bundled or
consolidated contract (as defined in subsection
(s)) or a bundled or consolidated task order;
and
(B) shall, unless the contracting agency
requests a review, limit the scope of review by
the procurement center representative for any
solicitation of a contract or task order if
such solicitation is awarded by or for the
Department of Defense and--
(i) is conducted pursuant to section
22 of the Arms Export Control Act (22
U.S.C. 2762);
(ii) is a humanitarian operation as
defined in section 401(e) of title 10,
United States Code;
(iii) is for a contingency operation,
as defined in section 101(a)(13) of
title 10, United States Code;
(iv) is to be awarded pursuant to an
agreement with the government of a
foreign country in which Armed Forces
of the United States are deployed; or
(v) both the place of award and the
place of performance are outside of the
United States and its territories.
(m)(1) Each agency subject to the requirements of section
2323 of title 10, United States Code, shall, when implementing
such requirements--
(A) establish policies and procedures that insure
that there will be no reduction in the number of dollar
value of contracts awarded pursuant to this section and
section 8
(a) in order to achieve any goal or other program
objective; and
(B) assure that such requirements will not alter or
change the procurement process used to implement this
section or section 8(a).
(2) All procurement center representatives (including those
referred to in subsection (k)(6)), in addition to such other
duties as may be assigned by the Administrator, shall--
(A) monitor the performance of the procurement
activities to which they are assigned to ascertain the
degree of compliance with the requirements of paragraph
(1);
(B) report to their immediate supervisors all
instances of noncompliance with such requirements; and
(C) increase, insofar as possible, the number and
dollar value of procurements that may be used for the
programs established under this section, section 8(a),
and section 2323 of title 10, United States Code.
(n) For purposes of this section, the determination of labor
surplus areas shall be made on the basis of the criteria in
effect at the time of the determination, except that any
minimum population criteria shall not exceed twenty-five
thousand. Such determination, as modified by the preceding
sentence, shall be made by the Secretary of Labor.
(o) Limitations on Subcontracting.--A concern may not be
awarded a contract under subsection
(a) as a small business concern unless the concern agrees
to satisfy the requirements of section 46.
(p) Access to Data.--
(1) Bundled contract defined.--In this subsection,
the term ``bundled contract'' has the meaning given
such term in section 3(o)(1).
(2) Database.--
(A) In general.--Not later than 180 days
after the date of the enactment of this
subsection, the Administrator of the Small
Business Administration shall develop and shall
thereafter maintain a database containing data
and information regarding--
(i) each bundled contract awarded by
a Federal agency; and
(ii) each small business concern that
has been displaced as a prime
contractor as a result of the award of
such a contract.
(3) Analysis.--For each bundled contract that is to
be recompeted as a bundled contract, the Administrator
shall determine--
(A) the amount of savings and benefits (in
accordance with subsection (e)) achieved under
the bundling of contract requirements; and
(B) whether such savings and benefits will
continue to be realized if the contract remains
bundled, and whether such savings and benefits
would be greater if the procurement
requirements were divided into separate
solicitations suitable for award to small
business concerns.
(4) Annual report on contract bundling.--
(A) In general.--Not later than 1 year after
the date of the enactment of this paragraph,
and annually in March thereafter, the
Administration shall transmit a report on
contract bundling to the Committees on Small
Business of the House of Representatives and
the Senate.
(B) Contents.--Each report transmitted under
subparagraph (A) shall include--
(i) data on the number, arranged by
industrial classification, of small
business concerns displaced as prime
contractors as a result of the award of
bundled contracts by Federal agencies;
and
(ii) a description of the activities
with respect to previously bundled
contracts of each Federal agency during
the preceding year, including--
(I) data on the number and
total dollar amount of all
contract requirements that were
bundled; and
(II) with respect to each
bundled contract, data or
information on--
(aa) the
justification for the
bundling of contract
requirements;
(bb) the cost savings
realized by bundling
the contract
requirements over the
life of the contract;
(cc) the extent to
which maintaining the
bundled status of
contract requirements
is projected to result
in continued cost
savings;
(dd) the extent to
which the bundling of
contract requirements
complied with the
contracting agency's
small business
subcontracting plan,
including the total
dollar value awarded to
small business concerns
as subcontractors and
the total dollar value
previously awarded to
small business concerns
as prime contractors;
and
(ee) the impact of
the bundling of
contract requirements
on small business
concerns unable to
compete as prime
contractors for the
consolidated
requirements and on the
industries of such
small business
concerns, including a
description of any
changes to the
proportion of any such
industry that is
composed of small
business concerns.
(5) Access to data.--
(A) Federal procurement data system.--To
assist in the implementation of this section,
the Administration shall have access to
information collected through the Federal
Procurement Data System.
(B) Agency procurement data sources.--To
assist in the implementation of this section,
the head of each contracting agency shall
provide, upon request of the Administration,
procurement information collected through
existing agency data collection sources.
(q) Reports Related to Procurement Center Representatives.--
(1) Teaming and joint venture requirements.--
(A) In general.--Each Federal agency shall
include in each solicitation for any multiple
award contract above the substantial bundling
threshold of the Federal agency a provision
soliciting bids from any responsible source,
including responsible small business concerns
and teams or joint ventures of small business
concerns.
(B) Teams.--When evaluating an offer of a
small business prime contractor that includes a
proposed team of small business subcontractors
for any multiple award contract above the
substantial bundling threshold of the Federal
agency, the head of the agency shall consider
the capabilities and past performance of each
first tier subcontractor that is part of the
team as the capabilities and past performance
of the small business prime contractor.
(C) Joint ventures.--When evaluating an offer
of a joint venture of small business concerns
for any multiple award contract above the
substantial bundling threshold of the Federal
agency, if the joint venture does not
demonstrate sufficient capabilities or past
performance to be considered for award of a
contract opportunity, the head of the agency
shall consider the capabilities and past
performance of each member of the joint venture
as the capabilities and past performance of the
joint venture.
(2) Policies on reduction of contract bundling.--
(A) In general.--Not later than 1 year after
the date of enactment of this subsection, the
Federal Acquisition Regulatory Council
established under section 25(a) of the Office
of Federal Procurement Policy Act (41 U.S.C.
4219(a)) shall amend the Federal Acquisition
Regulation issued under section 25 of such Act
to--
(i) establish a Government-wide
policy regarding contract bundling,
including regarding the solicitation of
teaming and joint ventures under
paragraph (1); and
(ii) require that the policy
established under clause (i) be
published on the website of each
Federal agency.
(B) Rationale for contract bundling.--Not
later than 30 days after the date on which the
head of a Federal agency submits data
certifications to the Administrator for Federal
Procurement Policy, the head of the Federal
agency shall publish on the website of the
Federal agency a list and rationale for any
bundled contract for which the Federal agency
solicited bids or that was awarded by the
Federal agency.
(3) Reporting.--Not later than 90 days after the date
of enactment of this subsection, and every 3 years
thereafter, the Administrator shall submit to the
Committee on Small Business and Entrepreneurship of the
Senate and the Committee on Small Business of the House
of Representatives a report regarding procurement
center representatives and commercial market
representatives, which shall--
(A) identify each area for which the
Administration has assigned a procurement
center representative or a commercial market
representative;
(B) explain why the Administration selected
the areas identified under subparagraph (A);
and
(C) describe the activities performed by
procurement center representatives and
commercial market representatives.
(r) Multiple Award Contracts.--Not later than 1 year after
the date of enactment of this subsection, the Administrator for
Federal Procurement Policy and the Administrator, in
consultation with the Administrator of General Services, shall,
by regulation, establish guidance under which Federal agencies
may, at their discretion--
(1) set aside part or parts of a multiple award
contract for small business concerns, including the
subcategories of small business concerns identified in
subsection (g)(2);
(2) notwithstanding the fair opportunity requirements
under section 2304c(b) of title 10, United States Code,
and section 303J(b) of the Federal Property and
Administrative Services Act of 1949 (41 U.S.C.
253j(b)), set aside orders placed against multiple
award contracts for small business concerns, including
the subcategories of small business concerns identified
in subsection (g)(2); and
(3) reserve 1 or more contract awards for small
business concerns under full and open multiple award
procurements, including the subcategories of small
business concerns identified in subsection (g)(2).
(s) Data Quality Improvement Plan.--
(1) In general.--Not later than October 1, 2015, the
Administrator of the Small Business Administration, in
consultation with the Small Business Procurement
Advisory Council, the Administrator for Federal
Procurement Policy, and the Administrator of General
Services, shall develop a plan to improve the quality
of data reported on bundled or consolidated contracts
in the Federal procurement data system (described in
section 1122(a)(4)
(A) of title 41, United States Code).
(2) Plan requirements.--The plan shall--
(A) describe the roles and responsibilities
of the Administrator of the Small Business
Administration, each Director of Small and
Disadvantaged Business Utilization, the
Administrator for Federal Procurement Policy,
the Administrator of General Services, senior
procurement executives, and Chief Acquisition
Officers in--
(i) improving the quality of data
reported on bundled or consolidated
contracts in the Federal procurement
data system; and
(ii) contributing to the annual
report required by subsection (p)(4);
(B) recommend changes to policies and
procedures, including training procedures of
relevant personnel, to properly identify and
mitigate the effects of bundled or consolidated
contracts;
(C) recommend requirements for periodic and
statistically valid data verification and
validation; and
(D) recommend clear data verification
responsibilities.
(3) Plan submission.--The Administrator of the Small
Business Administration shall submit the plan to the
Committee on Small Business of the House of
Representatives and the Committee on Small Business and
Entrepreneurship of the Senate not later than December
1, 2016.
(4) Implementation.--Not later than October 1, 2016,
the Administrator of the Small Business Administration
shall implement the plan described in this subsection.
(5) Certification.--The Administrator shall annually
provide to the Committee on Small Business of the House
of Representatives and the Committee on Small Business
and Entrepreneurship of the Senate a certification of
the accuracy and completeness of data reported on
bundled and consolidated contracts.
(6) Definitions.--In this subsection, the following
definitions apply:
(A) Chief acquisition officer; senior
procurement executive.--The terms ``Chief
Acquisition Officer'' and ``senior procurement
executive'' have the meanings given such terms
in section 44(a) of this Act.
(B) Bundled or consolidated contract.--The
term ``bundled or consolidated contract'' means
a bundled contract (as defined in section 3(o))
or a contract resulting from the consolidation
of contracting requirements (as defined in
section 44(a)(2)).
(t) GAO Report on Small Business Administration Programs in
Puerto Rico.--Not later than one year after the date of
enactment of this subsection, the Comptroller General of the
United States shall submit to the Committee on Small Business
of the House of Representatives and the Committee on Small
Business and Entrepreneurship of the Senate a report on the
application and utilization of contracting activities of the
Administration (including contracting activities relating to
HUBZone small business concerns) in Puerto Rico. The report
shall also identify any provisions of Federal law that may
create an obstacle to the efficient implementation of such
contracting activities.
(u) Post-Award Compliance Resources.--The Administrator shall
provide to small business development centers and entities
participating in the Procurement Technical Assistance
Cooperative Agreement Program under chapter 142 of title 10,
United States Code, and shall make available on the website of
the Administration, a list of resources for small business
concerns seeking education and assistance on compliance with
contracting regulations (including the Federal Acquisition
Regulation) after award of a contract or subcontract.
(v) Regulatory Changes and Training Materials.--Not less than
annually, the Administrator shall provide to the Defense
Acquisition University (established under section 1746 of title
10, United States Code), the Federal Acquisition Institute
(established under section 1201 of title 41, United States
Code), the individual responsible for mandatory training and
education of the acquisition workforce of each agency
(described under section 1703(f)(1)(C) of title 41, United
States Code), small business development centers, and entities
participating in the Procurement Technical Assistance
Cooperative Agreement Program under chapter 142 of title 10,
United States Code--
(1) a list of all changes made in the prior year to
regulations promulgated--
(A) by the Administrator that affect Federal
acquisition; and
(B) by the Federal Acquisition Council that
implement amendments to this Act; and
(2) any materials the Administrator has developed
that explain, train, or assist Federal agencies or
departments or small business concerns with compliance
with the regulations described in paragraph (1).
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