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Bill Introduced in Senate to Make SBIR Program Permanent

August 14, 1998

Significant changes to the Small Business Innovation Research (SBIR) Program were proposed on July 31, 1998 by Senator Christopher Bond (R-MO), Chairman of the Senate Committee on Small Business, when he introduced Senate Bill S. 2407, the Small Business Programs Restructuring and Reform Act of 1998.

First, S. 2407 proposes to make the SBIR Program permanent. The SBIR program is currently authorized through FY 2000. At that time, the program will either need to be reauthorized or it will cease to exist. This bill would eliminate the need for continued reauthorization by making the SBIR program permanent.

Second, the bill would increase the allocation of funds to the SBIR Program from federal agencies' extramural R&D budgets from 2.5% to 3.5%. This increase would occur over four years beginning in FY 2001.

Finally, the bill would make a significant change in the program to encourage better outreach to states that receive few awards each year. The bill would permit up to 2% of the SBIR set aside pool of funds to support an outreach program, to promote better commercialization of the R&D awards, and to offset some administrative expenses. The bill stipulates that at least one-third of these non-award funds must be spent on outreach in those states that receive 25 or fewer awards each year.

Congress established the SBIR Program in 1982. Under this program, federal agencies with extramural research and development budgets of $100 million or more are required to set aside no less than 2.5% of that amount for small businesses. There are currently ten agencies that participate in this program.

S. 2407 was co-sponsored by Senators Coverdell (R-GA), Domenici (R-NM), Kempthorne (R-ID) and Snowe (R-ME). The bill has been referred to the Senate Committee on Small Business. For more information, visit the Thomas Legislative web page at http://thomas.loc.gov.