Senate Fails to Act on SBIR Bill

May 9, 2011

The U.S. Senate last week failed to act on the SBIR/STTR Reauthorization Act of 2011 (S. 493). A motion for cloture offered by Senate Majority Leader Harry Reid (D-Nev.) failed to garner the needed 60 votes, leaving the bill’s outlook in limbo with less than three weeks before it is set to expire at the end of May.

The bill languished in the Senate for the better part of a month, playing host to more than 100 proposed amendments, the majority of which were completely un-related to the bill itself. One of the key hurdles was an inability to find compromise over efforts by Sen. Olympia Snowe (R-Maine) to include an amendment mirroring her Small Business Regulatory Freedom Act (S.474).

NSBA was hopeful that an agreement could be reached between Sen. Snowe and Senate Majority Leader Harry Reid (D-Nev.) to pull Snowe’s amendment and schedule a stand-alone vote on the provision. Unfortunately that didn’t happen and because of it, S. 493 failed to move forward despite broad, bipartisan support of the measure.

“Countless hours have been spent crafting the Senate’s compromise, and it is a detriment to the program, small businesses and American innovation that it wasn’t approved today,” stated NSBA President Todd McCracken. “The highly-successful SBIR program is too critical to small-business innovation for it to be the target of political gamesmanship,”

Currently set to expire at the end of May, the Senate’s failure to pass the legislation could spell trouble for the broadly-endorsed compromise given the quickly-moving House bill, which, it appears, will include significant provisions not supported by NSBA.

That compromise would provide an eight-year reauthorization of the program and a one-percent increase in its allocation over the next decade. It also contains a breakthrough compromise on the highly-contentious issue of Venture Capital (VC) participation in the program. Specifically, S. 493 would render firms that were majority owned and controlled by multiple VC firms eligible for up to 25 percent of the SBIR funds at the National Institutes for Health, the National Science Foundation, and the Department of Energy, and up to 15 percent of the funds at the eight other participating agencies.

S. 493 boasts bipartisan support and, in addition to NSBA, has been endorsed by the Biotechnology Industry Organization, the National Venture Capital Association, the U.S. Chamber of Commerce, and the Small Business Technology Council.

SBIR is the nation’s largest source of early-stage research and development (R&D) funding and is responsible for 25 percent of the most critical U.S. innovations of the last decade. NSBA is urging the Senate to quickly revisit S. 493 and approve the measure to ensure any reauthorization moving forward includes the compromise language.