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01.12
Congress Delivers Holiday Present for Small Businesses
By Russ Harrison
Much to everyone’s surprise,
Congress gave a last-minute gift to America’s
small businesses in mid-December. After more
than
three years of haggling, legislators agreed to a
six-year extension of the SBIR and STTR
programs, removing long-term uncertainty about
the future of these programs.
The Small Business Innovation
Research (SBIR) and Small Business Technology
Transfer (STTR) programs are a vital source of
funds for new technology companies. The programs
provide a research grants that help these
companies conduct research. The funds are
especially important for start-up technology
companies, which depend heavily on innovation
and invention for their success.
The SBIR and STTR programs are
very popular with the American public and with
Congress. But despite their popularity and
proven track record of success, Congress had
been unable to pass a long-term reauthorization
of either program for years. Policy
disagreements defied compromise for years,
leading to 14 short-term extensions for the SBIR
program and 11 for the STTR program. While
short-term extensions allowed the programs to
continue, they added uncertainty, making them harder for small companies
to rely on funding from the multi-year grants.
Funding for both programs comes
from the R&D budgets of participating federal
agencies, which set aside a certain percentage
of their R&D funds specifically for small
businesses. More information about the SBIR and
STTR programs can be found here: http://www.sbir.gov/
The agreement on a long-term
extension of the program was announced on
12 December, one week before the
end of the 2011 legislative year. Small Business
Committee Chairs Senator Mary Landrieu (D-La.)
and Representative Sam Graves (R-Mo.), along with
other key legislators, reached an agreement
earlier in December on the terms of the
reauthorization deal, which was then added as an
amendment to the Defense Authorization Act.
Key parts of the reauthorized
programs:
·
Reauthorized for six years
·
Phase I grants increased to a
maximum of 150,000. Phase II grants increased to
$1 million, with additional money made available
for especially promising projects
·
Increases the SBIR set-aside
percentage from 2.5 percent to 3.2 percent. STTR set-aside increases
from .3 percent to .45 percent
·
Allows companies with private
capitol support to participate in the programs
·
Reduces the paperwork required to
apply for a grant and improves the speed and
transparency of the grant process
IEEE-USA supported the
reauthorization of both programs, and had
communicated to Congress the inadequacy of
short-term reauthorizations. Since most
companies receive their grants over a two to
five year period, they required a multi-year
commitment from the government. Businesses that
were thinking of using an SBIR or STTR grant as
a major source of research funds had to consider
that the programs have been constantly in danger
of ending for the past five years. This
increased the risk associated with getting
involved with the programs, reducing their
usefulness. As House Science, Space and
Technology Committee Chair Rep. Ralph Hall
(R-Texas) explains: “This agreement will provide
thousands of small businesses with the certainty
necessary to facilitate innovation and create
high-paying jobs. “
Questions about IEEE-USA’s public policy
initiatives or the SBIR program can be directed
to Bill Williams at
bill.williams@ieee.org.
Russell T. Harrison is
IEEE-USA’s Senior Legislative Representative for
Grassroots Affairs.
Comments may be submitted to
todaysengineer@ieee.org.
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