Small Business Programs at Risk As Congress Debates Merits.

• Author: Matory, Kea
• Position: VIEWPOINT

Due to sunset provisions in the Small Business Innovation Research and the Small Business Technology Transfer programs, absent an extension through further legislative action, the programs will cease at the end of this fiscal year.

SBIR and STTR--first enacted in the Small Business Innovation Development Act of 1982, and the Small Business Research and Development Enhancement Act of 1992--create partnerships between federal agencies, public research institutions and the nation's best and brightest small businesses to develop important technologies.

For this reason, their reauthorization is a top priority for the National Defense Industrial Association. The programs meet their goals by leveraging a small percentage of extramural federal research and development spending through competitive awards.

For fiscal year 2020, the most complete year of data, these programs resulted in nearly $3.9 billion going to small high-technology firms. Such funding stimulates technological innovation to ensure a competitive advantage in all domains for warfighters.

They are not venture capital programs, but they are often referred to as the nation's seed fund because the awards provide non-dilutive money for projects that can be early stage and high-risk research critical to keeping the United States competitive internationally and to fulfilling the needs of Americans.

The Small Business Innovation Research program has been reauthorized on a bipartisan basis for more than 40 years, but Congress is currently debating its merits. This is occurring as time runs out. There are only 11 legislative days in September when both chambers are in session, with no legislative vehicle likely to pass with SBIR's inclusion before it lapses, save the possibility of it being included on another continuing resolution.

Recently to everyone's surprise, there was discussion of a free-standing bill under expedited consideration, a process that depends on unanimous consent by 100 senators--not an easy standard.

Expiration would not be due to a lack of effort from individuals on the Hill, in industry, the Small Business Administration and the Pentagon. A five-year extension was included on the House's Creating Opportunities for Manufacturing, Pre-Eminence in Technology and Economic Strength (COMPETES) Act.

However, when the bill moved forward in the Senate as a slimmed-down version of the United States Innovation and Competition Act of 2021 into the CHIPS and Science Act of 2022...