Committee Approves SBIR/STTR Reauthorization

March 23, 2016

pic-tech-innovate-smOn March 17, the House Committee on Small Business Chairman Steve Chabot (R-Ohio) introduced the Commercializing on Small Business Innovation Act of 2016 (H.R. 4783) which was also cosponsored by committee Ranking Member Nydia Velázquez (D-N.Y.). The legislation would reauthorize the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs which are set to expire in 2017. On March 23, the House Committee on Small Business held a markup on that legislation. In advance of that markup, NSBA sent a letter to the committee applauding them for beginning the reauthorization process so early in the legislative year and urging them to approve the reauthorization legislation.

During that markup Ranking Member Velázquez offered an amendment expanding the SBIR program. The amendment would create a pilot program to test the effectiveness of allowing agencies to grant a second award to businesses in Phase II in order to bridge a gap in funding that often exists for these small businesses. Rep. Steve Knight (R-Calif.) also introduced an amendment which would extend until 2022 an agency’s ability to use up to 3 percent of its SBIR funds on administrative and community outreach costs. Ranking Member Velázquez introduced a second amendment which would require agencies reserving SBIR funds for those administrative and community outreach costs, to submit detailed reports on how those funds are used. The committee adopted all amendments and approved the reauthorization legislation by voice vote.

These programs represent the country’s largest source of early-stage research and development funding for small businesses. They are critical for small businesses because they are often the only place where these types of funds are available for them. In 2014, less than 2 percent of the federal R&D budget was allocated through the programs; however they have an unparalleled history of success. During the programs’ 35 years of existence, they have generated in excess of 70,000 patents, all through small businesses. Despite this success, the last reauthorization process took over three years and 12 continuing resolutions before the programs were reauthorized until 2017.

This bipartisan legislation would reauthorize the SBIR and STTR programs through 2022. Additionally, under the legislation the levels of funding for the programs would increase each year during the authorization, culminating with 4.5 percent of federal R&D funding funneled to the SBIR program and 0.6 percent into the STTR program in 2022. The legislation also addresses insertion incentives by requiring the Secretary of Defense to establish goals for the transition of Phase III technologies in subcontracting plans and requiring prime contractors on those contracts to report the number and dollar amount of contracts entered into by that prime contractor for Phase III SBIR or STTR projects.

NSBA strongly supports the reauthorization of the SBIR and STTR programs. Both programs enable small businesses to compete in technologically-focused fields against much larger competitors. Under these programs small businesses have been able to answer the technological needs of the federal government as well as add high-quality jobs to communities throughout the country. NSBA looks forward to a speedy reauthorization process and to working with Congress to ensure that these programs continue to provide small businesses with tremendous potential to innovate and succeed.

Please click here to download NSBA’s official letter of support for H.R. 4783.

Please click here to download NSBA’s official press release in support of H.R. 4783.

ACTION ALERT: Click here to contact your lawmakers and urge their support.