Derryck Hains
Derryck Hains is a Director of Advanced Technology and Government Relations at McAllister & Quinn. He provides strategic intelligence and policy support to the firm’s industry clients to align their R&D priorities with federal programs and funding trends.
After five months of uncertainty, a deal has emerged between key lawmakers to reauthorize the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs for the next five years. This development comes days after the Pentagon’s Office of Small Business Innovation warned that it would need to begin shuttering operations.
How did we get here?
Authority for the SBIR/STTR programs expired at the exact same time as the government shutdown last fall. The shutdown, which broke records as the longest lapse in federal funding, lasted over 43 days. This interruption in funding placed SBIR reauthorization talks on hold while lawmakers worked to stem the impacts to their communities while negotiators hashed out a funding patch. Holidays and pre-planned Congressional recesses further delayed SBIR efforts and provided time for stakeholders to become entrenched in their positions.
Fresh negotiations began in the new year with questions of how to address Multi-Award Winners (MAWs). These MAWs are routine performers that receive an outsized share of research funding year after year. Critics of MAWs (pejoratively referred to as ‘SBIR Mills’) maintain that MAWs crowd out small businesses and weaken the program. MAWs for their part argue that their knowledge of federal R&D priorities provides the government with reliable critical research, and that they often don’t commercialize funded technologies.
Check out our earlier analysis for more background on the initial lapse in authorization.
Changes to the SBIR/STTR Program
The changes included in the Small Business Innovation and Economic Security Act fall short of the complete overhaul proposed by Senator Joni Ernst’s (R-IA) INNOVATE Act. Still the legislation does institute new restrictions that aim to combat the role of MAWs and curb the risk posed by adversarial nations:
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Agencies must institute annual limits on applications, at their discretion
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Increases to due diligence requirements and sets production requirements for some projects
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Identifies new foreign entities of risk
What’s next for SBIR/STTR?
With this deal announced and key lawmakers from the House and Senate Small Business Committees in alignment, they will seek to pass H.R. 5100 by unanimous consent, fast tracking the bill to the President’s desk. We expect agencies will move fast on resuming projects and releasing solicitations. With new restrictions on applications that will vary by agency, small businesses will need to be strategic in developing their federal funding strategies.
Discover How We Can Help
McAllister & Quinn’s team of federal funding and policy experts can help your organization align with these new guidelines and develop an intentional strategy that prioritizes your technology’s R&D goals. Contact us if you would like to read our full analysis of the Small Business Innovation and Economic Security Act, or to discuss how the proposed changes may impact your organization.
