15 U.S.C. § 638
Section 638 · Research and development
Current version, with additions and removals from the December 27, 2021 version.
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.
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.
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.
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.
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:
to construct, acquire, or establish laboratories and other facilities for the conduct of research;
to undertake and utilize applied research;
to collect research information related to a particular industry and disseminate it to participating members;
to conduct applied research on a protected, proprietary, and contractual basis with member or nonmember firms, Government agencies, and others;
to prosecute applications for patents and render patent services for participating members; and
to negotiate and grant licenses under patents held under the joint program, and to establish corporations designed to exploit particular patents obtained by it.
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.
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 [15 U.S.C. 41 et seq.]. 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.
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:
to construct, acquire, or establish laboratories and other facilities for the conduct of research;
to undertake and utilize applied research;
to collect research information related to a particular industry and disseminate it to participating members;
to conduct applied research on a protected, proprietary, and contractual basis with member or nonmember firms, Government agencies, and others;
to prosecute applications for patents and render patent services for participating members; and
to negotiate and grant licenses under patents held under the joint program, and to establish corporations designed to exploit particular patents obtained by it.
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.
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 [15 U.S.C. 41 et seq.]. 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.
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—
not less than 1.5 percent of such budget in each of fiscal years 1993 and 1994;
not less than 2.0 percent of such budget in each of fiscal years 1995 and 1996;
not less than 2.5 percent of such budget in each of fiscal years 1997 through 2011;
not less than 2.6 percent of such budget in fiscal year 2012;
not less than 2.7 percent of such budget in fiscal year 2013;
not less than 2.8 percent of such budget in fiscal year 2014;
not less than 2.9 percent of such budget in fiscal year 2015;
not less than 3.0 percent of such budget in fiscal year 2016; and
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.
A Federal agency shall not—
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
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).
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).
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).
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—
not less than 1.5 percent of such budget in each of fiscal years 1993 and 1994;
not less than 2.0 percent of such budget in each of fiscal years 1995 and 1996;
not less than 2.5 percent of such budget in each of fiscal years 1997 through 2011;
not less than 2.6 percent of such budget in fiscal year 2012;
not less than 2.7 percent of such budget in fiscal year 2013;
not less than 2.8 percent of such budget in fiscal year 2014;
not less than 2.9 percent of such budget in fiscal year 2015;
not less than 3.0 percent of such budget in fiscal year 2016; and
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.
A Federal agency shall not—
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
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).
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).
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).
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.
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.
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.
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.
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).
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.
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.
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).
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).
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 Phase II of an SBIR program during the preceding 5 fiscal years.
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.
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).
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 Phase II of an SBIR program during the preceding 5 fiscal years.
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.
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—
the heads of each of the Federal agencies required by subsection (n) to establish an STTR program;
the Under Secretary of Commerce for Intellectual Property and Director of the United States Patent and Trademark Office; and
the Director of the Office of Federal Procurement Policy.
The policy directive required by paragraph (1) shall provide for—
simplified, standardized, and timely STTR solicitations;
a simplified, standardized funding process that provides for—
the timely receipt and review of proposals;
outside peer review, if appropriate;
protection of proprietary information provided in proposals;
selection of awardees;
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;
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;
cost sharing;
cost principles and payment schedules; and
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;
minimizing regulatory burdens associated with participation in STTR programs;
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;
procedures to ensure that—
a recipient of an STTR award is a small business concern, as defined in section 632 of this title and the regulations promulgated thereunder; and
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;
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
procedures to ensure that procurement center representatives (as described in section 644(l) of this title)—
consult with the appropriate personnel from the relevant Federal agency, to assist small business concerns participating in the STTR program, particularly in Phase III;
provide technical assistance to such concerns to submit a bid for an award of a Federal contract; and
consult with the appropriate personnel from the relevant Federal agency in providing the assistance described in clause (i).
Not later than 120 days after October 15, 2001, 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.
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—
the heads of each of the Federal agencies required by subsection (n) to establish an STTR program;
the Under Secretary of Commerce for Intellectual Property and Director of the United States Patent and Trademark Office; and
the Director of the Office of Federal Procurement Policy.
The policy directive required by paragraph (1) shall provide for—
simplified, standardized, and timely STTR solicitations;
a simplified, standardized funding process that provides for—
the timely receipt and review of proposals;
outside peer review, if appropriate;
protection of proprietary information provided in proposals;
selection of awardees;
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;
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;
cost sharing;
cost principles and payment schedules; and
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;
minimizing regulatory burdens associated with participation in STTR programs;
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;
procedures to ensure that—
a recipient of an STTR award is a small business concern, as defined in section 632 of this title and the regulations promulgated thereunder; and
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;
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
procedures to ensure that procurement center representatives (as described in section 644(l) of this title)—
consult with the appropriate personnel from the relevant Federal agency, to assist small business concerns participating in the STTR program, particularly in Phase III;
provide technical assistance to such concerns to submit a bid for an award of a Federal contract; and
consult with the appropriate personnel from the relevant Federal agency in providing the assistance described in clause (i).
Not later than 120 days after October 15, 2001, 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.
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.
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.
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.
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.
In this subsection, the term “technology development program” means—
the Experimental Program to Stimulate Competitive Research of the National Science Foundation, as established under section 1862g of title 42;
the Defense Experimental Program to Stimulate Competitive Research of the Department of Defense;
the Experimental Program to Stimulate Competitive Research of the Department of Energy;
the Experimental Program to Stimulate Competitive Research of the Environmental Protection Agency;
the Experimental Program to Stimulate Competitive Research of the National Aeronautics and Space Administration;
the Institutional Development Award Program of the National Institutes of Health; and
the National Research Initiative Competitive Grants Program of the Department of Agriculture.
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—
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—
a State that is eligible to participate in that program; or
a State described in paragraph (3); or
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—
a State that is eligible to participate in a technology development program; or
a State described in paragraph (3).
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.
In this subsection, the term “technology development program” means—
the Experimental Program to Stimulate Competitive Research of the National Science Foundation, as established under section 1862g of title 42;
the Defense Experimental Program to Stimulate Competitive Research of the Department of Defense;
the Experimental Program to Stimulate Competitive Research of the Department of Energy;
the Experimental Program to Stimulate Competitive Research of the Environmental Protection Agency;
the Experimental Program to Stimulate Competitive Research of the National Aeronautics and Space Administration;
the Institutional Development Award Program of the National Institutes of Health; and
the National Research Initiative Competitive Grants Program of the Department of Agriculture.
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—
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—
a State that is eligible to participate in that program; or
a State described in paragraph (3); or
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—
a State that is eligible to participate in a technology development program; or
a State described in paragraph (3).
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.
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.
Not later than 1 year after December 31, 2011, 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.
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.
Not later than 1 year after December 31, 2011, 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.
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.
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.
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.
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.
In carrying out its duties under this section relating to SBIR and STTR solicitations by Federal departments and agencies, the Administrator shall—
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
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.
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.
The Administrator shall, as soon as is practicable after December 19, 2007, issue guidelines and directives to assist Federal agencies in meeting the requirements of this subsection.
In this subsection—
the term “biomass”—
means any organic material that is available on a renewable or recurring basis, including—
agricultural crops;
trees grown for energy production;
wood waste and wood residues;
plants (including aquatic plants and grasses);
residues;
fibers;
animal wastes and other waste materials; and
fats, oils, and greases (including recycled fats, oils, and greases); and
does not include—
paper that is commonly recycled; or
unsegregated solid waste;
the term “energy efficiency project” means the installation or upgrading of equipment that results in a significant reduction in energy usage; and
the term “renewable energy system” means a system of energy derived from—
a wind, solar, biomass (including biodiesel), or geothermal source; or
hydrogen derived from biomass or water using an energy source described in clause (i).
In carrying out its duties under this section relating to SBIR and STTR solicitations by Federal departments and agencies, the Administrator shall—
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
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.
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.
The Administrator shall, as soon as is practicable after December 19, 2007, issue guidelines and directives to assist Federal agencies in meeting the requirements of this subsection.
In this subsection—
the term “biomass”—
means any organic material that is available on a renewable or recurring basis, including—
agricultural crops;
trees grown for energy production;
wood waste and wood residues;
plants (including aquatic plants and grasses);
residues;
fibers;
animal wastes and other waste materials; and
fats, oils, and greases (including recycled fats, oils, and greases); and
does not include—
paper that is commonly recycled; or
unsegregated solid waste;
the term “energy efficiency project” means the installation or upgrading of equipment that results in a significant reduction in energy usage; and
the term “renewable energy system” means a system of energy derived from—
a wind, solar, biomass (including biodiesel), or geothermal source; or
hydrogen derived from biomass or water using an energy source described in clause (i).
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).
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).
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.
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).
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).
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.
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—
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
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.
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—
induce additional venture capital, hedge fund, or private equity firm funding of small business innovations;
substantially contribute to the mission of the Federal agency;
demonstrate a need for public research; and
otherwise fulfill the capital needs of small business concerns for additional financing for SBIR projects.
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—
register with the Administrator on the date that the small business concern submits an application for an award under the SBIR program; and
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.
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.
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).
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).
In this paragraph, the term “covered small business concern” means a small business concern that—
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
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.
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—
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
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.
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.
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—
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
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.
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—
induce additional venture capital, hedge fund, or private equity firm funding of small business innovations;
substantially contribute to the mission of the Federal agency;
demonstrate a need for public research; and
otherwise fulfill the capital needs of small business concerns for additional financing for SBIR projects.
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—
register with the Administrator on the date that the small business concern submits an application for an award under the SBIR program; and
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.
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.
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).
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).
In this paragraph, the term “covered small business concern” means a small business concern that—
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
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.
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—
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
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.
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.
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—
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
has entered into a cooperative research and development agreement (as defined in section 3710a(d) of this title) with a Federal laboratory.
No Federal agency shall—
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;
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
approve an agreement that violates any provision, including any data rights protections provision, of this section or the SBIR and the STTR Policy Directives.
Not later than 180 days after December 31, 2011, the Administrator shall modify the SBIR Policy Directive and the STTR Policy Directive issued under this section to ensure that small business concerns—
have the flexibility to use the resources of the Federal laboratories or federally funded research and development centers; and
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.
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.
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—
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
has entered into a cooperative research and development agreement (as defined in section 3710a(d) of this title) with a Federal laboratory.
No Federal agency shall—
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;
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
approve an agreement that violates any provision, including any data rights protections provision, of this section or the SBIR and the STTR Policy Directives.
Not later than 180 days after December 31, 2011, the Administrator shall modify the SBIR Policy Directive and the STTR Policy Directive issued under this section to ensure that small business concerns—
have the flexibility to use the resources of the Federal laboratories or federally funded research and development centers; and
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.
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.
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.
The Comptroller General of the United States shall submit to the Committee on Small Business and Entrepreneurship of the Senate, the Committee on Armed Services of the Senate, the Committee on Small Business of the House of Representatives, and the Committee on Armed Services of the House of Representatives—
not later than 1 year after August 13, 2018, and every year thereafter for 3 years, a report that—
provides the average and median amount of time that each component of the Department of Defense with an SBIR or STTR program takes to review and make a final decision on proposals submitted under the program; and
compares that average and median amount of time with that of other Federal agencies participating in the SBIR or STTR program; and
not later than December 5, 2021, a report that—
includes the information described in subparagraph (A);
assesses where each Federal agency participating in the SBIR or STTR program needs improvement with respect to the proposal review and award times under the program;
identifies best practices for shortening the proposal review and award times under the SBIR and STTR programs, including the pros and cons of using contracts compared to grants; and
analyzes the efficacy of the pilot program established under subsection (hh)(2).
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.
The Comptroller General of the United States shall submit to the Committee on Small Business and Entrepreneurship of the Senate, the Committee on Armed Services of the Senate, the Committee on Small Business of the House of Representatives, and the Committee on Armed Services of the House of Representatives—
not later than 1 year after August 13, 2018, and every year thereafter for 3 years, a report that—
provides the average and median amount of time that each component of the Department of Defense with an SBIR or STTR program takes to review and make a final decision on proposals submitted under the program; and
compares that average and median amount of time with that of other Federal agencies participating in the SBIR or STTR program; and
not later than December 5, 2021, a report that—
includes the information described in subparagraph (A);
assesses where each Federal agency participating in the SBIR or STTR program needs improvement with respect to the proposal review and award times under the program;
identifies best practices for shortening the proposal review and award times under the SBIR and STTR programs, including the pros and cons of using contracts compared to grants; and
analyzes the efficacy of the pilot program established under subsection (hh)(2).
The annual SBIR or STTR report to Congress by the Administration under subsection (b)(7) shall include, for each Phase III award—
the name of the agency or component of the agency or the non-Federal source of capital making the Phase III award;
the name of the small business concern or individual receiving the Phase III award; and
the dollar amount of the Phase III award.
The annual SBIR or STTR report to Congress by the Administration under subsection (b)(7) shall include, for each Phase III award—
the name of the agency or component of the agency or the non-Federal source of capital making the Phase III award;
the name of the small business concern or individual receiving the Phase III award; and
the dollar amount of the Phase III award.
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—
identify the concern to appropriate local and State-level economic development organizations as an SBIR applicant or an STTR applicant; and
release the contact information of the concern to such organizations.
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).
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—
identify the concern to appropriate local and State-level economic development organizations as an SBIR applicant or an STTR applicant; and
release the contact information of the concern to such organizations.
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).
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—
are science-based and statistically driven;
reflect the mission of the Federal agency; and
include factors relating to the economic impact of the programs.
The head of each Federal agency described in paragraph (1) shall conduct an annual evaluation using the metrics developed under paragraph (1) of—
the SBIR program and the STTR program of the Federal agency; and
the benefits to the people of the United States of the SBIR program and the STTR program of the Federal agency.
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).
The head of each Federal agency described in paragraph (1) shall make each report submitted under subparagraph (A) available to the public online.
In this paragraph, the term “appropriate committees of Congress” means—
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.
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—
are science-based and statistically driven;
reflect the mission of the Federal agency; and
include factors relating to the economic impact of the programs.
The head of each Federal agency described in paragraph (1) shall conduct an annual evaluation using the metrics developed under paragraph (1) of—
the SBIR program and the STTR program of the Federal agency; and
the benefits to the people of the United States of the SBIR program and the STTR program of the Federal agency.
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).
The head of each Federal agency described in paragraph (1) shall make each report submitted under subparagraph (A) available to the public online.
In this paragraph, the term “appropriate committees of Congress” means—
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.
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.
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.
The Administrator may only carry out a covered pilot program that is in operation on December 31, 2011, during the 3-year period beginning on such date.
The Administrator may only carry out a covered pilot program established after December 31, 2011—
during the 3-year period beginning on the date on which such program is established; and
if such program does not continue and is not based on, in any manner, a previously established covered pilot program.
In this subsection, the term “covered pilot program” means any initiative, project, innovation, or other activity—
established by the Administrator;
relating to an SBIR or STTR program; and
not specifically authorized by law.
The Administrator may only carry out a covered pilot program that is in operation on December 31, 2011, during the 3-year period beginning on such date.
The Administrator may only carry out a covered pilot program established after December 31, 2011—
during the 3-year period beginning on the date on which such program is established; and
if such program does not continue and is not based on, in any manner, a previously established covered pilot program.
In this subsection, the term “covered pilot program” means any initiative, project, innovation, or other activity—
established by the Administrator;
relating to an SBIR or STTR program; and
not specifically authorized by law.
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.
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.
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—
a description of efforts undertaken by the head of the Federal agency to enhance United States manufacturing activities;
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);
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;
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
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.
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—
a description of efforts undertaken by the head of the Federal agency to enhance United States manufacturing activities;
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);
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;
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
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.
Not later than March 30, 2019, the Administrator shall submit to the Committee on Small Business and Entrepreneurship of the Senate, the Committee on Small Business of the House of Representatives, and the Committee on Science, Space, and Technology of the House of Representatives—
each report, evaluation, or analysis, as applicable, described in subsection (b)(7), (g)(9), (o)(10), (y)(6)(C), (gg)(6), (jj)(6), and (mm)(6); and
metrics regarding, and an evaluation of, the authority provided to the National Institutes of Health, the Department of Defense, and the Department of Education under subsection (cc).
Not later than December 31, 2018, the head of each agency that is responsible for carrying out a provision described in subparagraph (A) or (B) of paragraph (1) shall submit to the Administrator any information that is necessary for the Administrator to carry out the responsibilities of the Administrator under that paragraph.
Not later than March 30, 2019, the Administrator shall submit to the Committee on Small Business and Entrepreneurship of the Senate, the Committee on Small Business of the House of Representatives, and the Committee on Science, Space, and Technology of the House of Representatives—
each report, evaluation, or analysis, as applicable, described in subsection (b)(7), (g)(9), (o)(10), (y)(6)(C), (gg)(6), (jj)(6), and (mm)(6); and
metrics regarding, and an evaluation of, the authority provided to the National Institutes of Health, the Department of Defense, and the Department of Education under subsection (cc).
Not later than December 31, 2018, the head of each agency that is responsible for carrying out a provision described in subparagraph (A) or (B) of paragraph (1) shall submit to the Administrator any information that is necessary for the Administrator to carry out the responsibilities of the Administrator under that paragraph.
The head of each Federal agency required to establish an SBIR or STTR program, in coordination with the Administrator, shall establish and implement a due diligence program to assess security risks presented by small business concerns seeking a federally funded award.
Each program established under paragraph (1) shall—
assess, using a risk-based approach as appropriate—
the cybersecurity practices of a small business concern;
patent analysis;
employee analysis;
foreign ownership of a small business concern seeking an award, including the financial ties and obligations (which shall include surety, equity, and debt obligations) of the small business concern and employees of the small business concern to a foreign country, foreign person, or foreign entity;
foreign affiliations of a covered individual, owner, or other key personnel of a small business concern with an entity in a foreign country of concern;
investment relationships of a small business concern with an individual or entity in a foreign country of concern;
technology licensing agreements or joint ventures (including joint venture-like agreements) with an individual or entity in a foreign country of concern; and
business relationships between a covered individual, owner, or other key personnel of a small business concern and an individual or entity in a foreign country of concern;
assess awards and proposals or applications, as applicable, using a risk-based approach as appropriate, including through the use of open-source analysis and analytical tools, for the nondisclosures of information required under (g)(13); 7 and
examine any relationship of a small business concern seeking an award to any entity or individual included on the lists described in subsections (g)(16)(D) and (o)(20)(D).
In addition to the amount allocated under subsection (mm)(1), each Federal agency required to establish an SBIR program may allocate not more than 2 percent of the funds allocated to the SBIR program of the Federal agency for the cost of establishing the due diligence program required under this subsection.
Not later than December 31 of the year in which this subparagraph is enacted, and not later than December 31 of each year thereafter, the head of a Federal agency that exercises the authority under subparagraph (A) shall submit to the Committee on Small Business and the Committee on Science, Space, and Technology of the House of Representatives, the Committee on Small Business and Entrepreneurship of the Senate, and the Administrator, for the covered year—
the total funds allowed to be allocated for the cost of establishing the due diligence program required under this subsection;
the total amount of funds obligated or expended under subparagraph (A); and
the due diligence activities carried out or to be carried out using amounts allocated under subparagraph (A).
The Administrator shall include the information submitted by head of a Federal agency under clause (i) in the next annual report submitted under subsection (b)(7) after the Administrator receives such information.
In this subparagraph, the term “covered year” means, with respect to the information required under clause (i), the year covered by the annual report submitted under subsection (b)(7) in which the Administrator is required to include such information by clause (ii).
This paragraph shall terminate on September 30, 2031.
Not later than 180 days after September 30, 2022, the Secretary of Defense shall establish innovation open topic activities using the SBIR and STTR programs of the Department of Defense in order to—
increase the transition of commercial technology to the Department of Defense;
expand the small business nontraditional industrial base;
increase commercialization derived from investments of the Department of Defense; and
expand the ability for qualifying small business concerns to propose technology solutions to meet the needs of the Department of Defense.
The Secretary of Defense shall conduct not less than 1 open topic announcement at each component of the Department of Defense per fiscal year.
Not later than 180 days after September 30, 2022, the Secretary of Defense shall provide a briefing on the establishment of the program required under paragraph (1) to—
the Committee on Armed Services and the Committee on Small Business and Entrepreneurship of the Senate; and
the Committee on Small Business, the Committee on Armed Services, and the Committee on Science, Space, and Technology of the House of Representatives.
A Federal agency required to establish an SBIR or STTR program shall implement a multi-level review and approval process within the Federal agency for solicitation topics to ensure adequate competition and that no private individual or entity is shaping the requirements for eligibility for the solicitation topic after the selection of the solicitation topic, except that the Federal agency may amend the requirements to clarify the solicitation topic.
A Federal agency that does not comply with paragraph (1) shall be referred to the Inspector General of the Administration for further investigation.
Not later than 180 days after December 23, 2024, the Secretary of Defense shall establish a pilot program to enable any undergraduate, graduate, or postgraduate degree-granting military research or educational institution established under title 10 to participate in the STTR program of the Department of Defense.
The authority to carry out the pilot program under this subsection shall end on September 30, 2031.
In order to more rapidly estimate allocations for the SBIR and STTR programs of the Department of Defense, the Secretary of Defense shall conduct a budget calculation pilot program that requires the calculation of total expenditures for the SBIR and STTR programs in the Department of Defense and determination of related allocations in accordance with subparagraphs (B) and (C), and paragraph (2), respectively.
Beginning in fiscal year 2025, the Department of Defense shall calculate required budget expenditures for its SBIR program as not less than 3.25 percent of the average of the total research, development, test, and evaluation extramural budget of the Department for the 2 most recent fully obligated fiscal year budgets.
Beginning in fiscal year 2025, the Department of Defense shall calculate required budget expenditures for its STTR program as not less than 0.46 percent of the average of the total research, development, test, and evaluation extramural budget of the Department for the 2 most recent fully obligated fiscal year budgets.
Not later than 30 days after the date of enactment of an appropriations bill for the Department of Defense for a fiscal year, the Department shall determine and make adjustments for actual allocations related to the SBIR and STTR programs of the Department.
The pilot program under this subsection shall terminate on September 30, 2031.
With respect to fiscal year 2027 and each fiscal year thereafter, the Director of the SBIR or STTR program office of each Federal agency shall, pursuant to authority that may not be delegated, set equally for all small business concerns a limit on the maximum number of proposals that a small business concern may submit in response to Phase I solicitations and Phase II solicitations under subsection (cc), published by that Federal agency, including all components of that Federal agency, in a single fiscal year. In establishing such a limitation, the Director of the SBIR or STTR program office of each Federal agency shall use 1 of the following methods:
A limit for any small business concern on a fiscal year basis.
A limit for any small business concern on a solicitation basis.
A limit for any small business concern on a topic basis.
On a topic by topic basis, the Director of the SBIR or STTR program office of each Federal agency may grant a waiver of the proposal limit under paragraph (1) at the time of a solicitation announcement for a specific topic for the SBIR or STTR program of the Federal agency if the topic is time-sensitive and urgent to the mission of the Federal agency.
For each topic for which a waiver is sought under subparagraph (A), the Director of the SBIR or STTR program office of the Federal agency shall provide a written justification to the Administrator, and to the Undersecretary described in subparagraph (C), for why the use of the waiver authority is imperative for the agency’s mission and the nature of the immediate and critical need that the Director reasonably believes cannot be met by small business concerns that have not reached the proposal limit under paragraph (1).
The Undersecretary overseeing the SBIR or STTR program at a Federal agency and the Administrator are required to approve or disapprove a waiver and written justification not later than 15 days after the date on which the Undersecretary receives from the Director the waiver request described in subparagraph (A) and the written justification described in subparagraph (B).
The authority to grant or approve a waiver under subparagraph (A) or (C), respectively, may not be delegated.
If the Federal agency grants a waiver under subparagraph (A) with respect to a topic for the SBIR or STTR program of a Federal agency, paragraph (1) shall not prohibit any small business concern from submitting an SBIR or STTR proposal to that Federal agency under such topic.
Participating agencies shall maintain information on topics to which waivers of the proposal limit under this paragraph are granted, including the written justifications for those waivers.
A Federal agency may not grant a waiver under this paragraph with respect to more than 5 percent of the topics of the SBIR and STTR programs of the Federal agency in any fiscal year.
Not later than 30 days after the date on which the Director of the SBIR or STTR program office of a Federal agency sets or changes a limit under paragraph (1), the head of that Federal agency shall provide 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 the methodology for setting or changing that limit, the considerations made in setting or changing that limit, and how many small business concerns are impacted by that limit based on historical data.
Not later than 30 days after the date on which the Director of the SBIR or STTR program office of a Federal agency grants a waiver under paragraph (2), the Director shall provide 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 written notification regarding the granting of that waiver, which shall include the information described in paragraph (2)(F) with respect to that waiver.
The Director shall establish the proposal limit under paragraph (1) not later than 90 days before the start of fiscal year 2027 and each fiscal year thereafter.
Each Federal agency with an Innovation Corps program (commonly known as “I–Corps”) that is required to conduct an SBIR or STTR program shall—
provide an option for requesting participation in an I–Corps teams course, I–Corps bootcamp, or another equivalent training program to recipients of an award under the SBIR or STTR program; and
authorize the recipients described in subparagraph (A) to use amounts authorized under subsection (q) to participate in the I–Corps teams course, I–Corps bootcamp, or another equivalent training program.
The cost of participation by a recipient described in paragraph (1)(A) in an I–Corps course, I–Corps bootcamp, or another equivalent training program may be provided by—
an I–Corps team SBIR or STTR grant;
funds awarded to the recipient under subsection (q);
funds made available to carry out subsection (mm);
the participating teams or other sources as appropriate; or
any combination of sources described in subparagraphs (A), (B), (C), and (D).