Innovation on hold for 1-out-of-4 SBIR winners

Federal agencies fail, on average, 24 percent of the time to notify applicant small businesses of award decisions within required deadlines. A small business has a zero percent chance of being able to plan to start an innovation project within six months if they apply to ARPA-E (the Department of Energy’s Advanced Research Projects Agency) or the Defense Threat Reduction Agency, both of which never met the deadline. 

These competitiveness-throttling facts were uncovered in the latest SBIR-related report from the General Accounting Office (GAO), released Sept. 26.  “Small Business Innovation Programs: Many Agencies Took Longer to Issue Small Business Awards than Recommended,” reports only 13 of the 28 federal agencies, offices and components included in the analysis were able to make timely awards (within 180 days) more than 50 percent of the time.

For its analysis, the GAO looked at the time from application to notification for more than 15,000 SBIR and STTR awards made during the fiscal years 2016, 2017 and 2018.  The number of proposals received or awards made appears to have no bearing on the performance records of the agencies.

Those SBIR/STTR programs with the highest performance records regarding percentage of notification times within 180 days included:

• 100 percent – Homeland Security: Science & Technology Directorate
• 100 – Homeland Security: Domestic Nuclear Detection Office
• 100 – National Oceanic & Atmospheric Administration
• 99.8 – National Science Foundation
• 99 – Defense Health Agency
• 98 – NASA
• 98 – National Institute of Standards & Technology
• 98 – National Institutes of Health (has its own 15-month requirement for notification instead of 180 days.  This is average for all of the institutes)
• 96 – Defense: Special Operations Command
• 96 – Defense: Joint Science and Technology Office for Chemical and Biological Defense

The GAO found on the occasions that the Department of Education and the Department of the Army each missed the 180-day deadline, it was by no more than one or two days respectively. The average across all agencies for late notifications, however, was 46 days.

In its comments responding to the report, the Small Business Administration cautioned against some interpretation of the data because of inconsistencies across agencies regarding the language used to describe issue dates, award dates, proposal submission dates, review, make a final decision, and notification of decision.  It recommended future GAO reports include definitions of terminology to “help to provide a clearer and more consistent picture of agency processes and timelines.” 

SBA also asked that future reports include analysis of the “gap time” between end of a Phase I award, notification of a Phase II award and making the Phase II award.  Decreasing this gap would reduce the burden on small businesses and on R&D performance.

Some members of Congress have noticed the long timeline between applications and awards. Senators Jeanne Shaheen, Marco Rubio and Ben Cardin have introduced legislation requiring agencies to accelerate awards. Unfortunately, the bill has not yet made any progress through the Senate. In the meantime, agencies can use their own processes and resources — including SBIR-specific administrative funding — to make necessary improvements without a congressional requirement.