SECTION 1. SHORT TITLE.

    This Act may be cited as the ``American Innovation Act of 2010''.

SEC. 2. GRANTEE REPORTS ON COMMERCIALIZATION STRATEGY AND RESULTS.

    (a) In General.--Any institution of higher education (as such term 
is defined in section 101(a) of the Higher Education Act of 1965 (20 
U.S.C. 1001(a))) that receives 1 or more grants of financial assistance 
from the National Science Foundation for research shall submit a report 
to the Foundation at the end of the first year of the grants, and at 
the end of each subsequent year in which funds are received pursuant to 
such grants, describing--
            (1) the institution's strategy for commercializing the 
        results of research supported by such grants;
            (2) the implementation of the strategy with respect to 
        research supported by the grants; and
            (3) the results of its efforts to realize the commercial 
        potential of the research supported by those grants.
    (b) Web Site.--The Foundation shall post reports received under 
this section on a Web site accessible to and searchable by the public.
    (c) Trade Secret Information.--An institution of higher education 
that submits reports to the Foundation under this section shall not 
reveal confidential, trade secret, or proprietary information in such 
reports.

SEC. 3. NSF GRANTS IN SUPPORT OF SPONSORED POST-DOCTORAL FELLOWSHIP 
              PROGRAMS.

    The Director of the National Science Foundation may utilize funds 
appropriated to carry out grants to institutions of higher education 
(as such term is defined in section 101(a) of the Higher Education Act 
of 1965 (20 U.S.C. 1001(a))) to provide financial support for post-
graduate research in fields with potential commercial applications to 
match, in whole or in part, any private sector grant of financial 
assistance to any post-doctoral program in such a field of study.

SEC. 4. STEM INDUSTRY INTERNSHIP PROGRAMS.

    (a) In General.--The Director may award grants, on a competitive, 
merit-reviewed basis, to institutions of higher education, or consortia 
thereof, to establish or expand partnerships with local or regional 
private sector entities, for the purpose of providing undergraduate 
students with integrated internship experiences that connect private 
sector internship experiences with the students' STEM coursework. The 
partnerships may also include industry or professional associations.
    (b) Internship Program.--The grants awarded under section (a) may 
include internship programs in the manufacturing sector.
    (c) Use of Grant Funds.--Grants under this section may be used--
            (1) to develop and implement hands-on learning 
        opportunities;
            (2) to develop curricula and instructional materials 
        related to industry, including the manufacturing sector;
            (3) to perform outreach to secondary schools;
            (4) to develop mentorship programs for students with 
        partner organizations; and
            (5) to conduct activities to support awareness of career 
        opportunities and skill requirements.
    (d) Priority.--In awarding grants under this section, the Director 
shall give priority to institutions of higher education or consortia 
thereof that demonstrate significant outreach to and coordination with 
local or regional private sector entities and Regional Centers for the 
Transfer of Manufacturing Technology established by section 25(a) of 
the National Institute of Standards and Technology Act (15 U.S.C. 
278k(a)) in developing academic courses designed to provide students 
with the skills or certifications necessary for employment in local or 
regional companies.
    (e) Outreach to Rural Communities.--The Foundation shall conduct 
outreach to institutions of higher education and private sector 
entities in rural areas to encourage those entities to participate in 
partnerships under this section.
    (f) Cost-Share.--The Director shall require a 50 percent non-
Federal cost-share from partnerships established or expanded under this 
section.
    (g) Restriction.--No Federal funds provided under this section may 
be used--
            (1) for the purpose of providing stipends or compensation 
        to students for private sector internships unless private 
        sector entities match 75 percent of such funding; or
            (2) as payment or reimbursement to private sector entities, 
        except for institutions of higher education.
    (h) Report.--Not less than 3 years after the date of enactment of 
this Act, the Director shall submit a report to Congress on the number 
and total value of awards made under this section, the number of 
students affected by those awards, any evidence of the effect of those 
awards on workforce preparation and jobs placement for participating 
students, and an economic and ethnic breakdown of the participating 
students.

SEC. 5. STUDY TO DEVELOP IMPROVED IMPACT-ON-SOCIETY METRICS.

    (a) In General.--Within 180 days after the date of enactment of 
this Act, the President of the National Academy of Sciences shall 
initiate a study to evaluate, develop, or improve metrics for measuring 
the potential impact-on-society, including--
            (1) the potential for commercial applications of research 
        studies funded in whole or in part by grants of financial 
        assistance from the National Science Foundation or other 
        Federal agencies;
            (2) the manner in which research conducted at, and 
        individuals graduating from, an institution of higher education 
        contribute to the development of new intellectual property and 
        the success of commercial activities;
            (3) the quality of relevant scientific and international 
        publications; and
            (4) the ability of such institutions to attract external 
        research funding.
    (b) Report.--Within 1 year after initiating the study required by 
subsection (a), the Director shall submit a report to the Senate 
Committee on Commerce, Science, and Transportation and the House of 
Representatives Committee on Science and Technology setting forth the 
Director's findings, conclusions, and recommendations.

SEC. 6. SIMPLIFICATION OF TAX CREDIT FOR CONTRIBUTIONS TO UNIVERSITIES 
              FOR RESEARCH AND DEVELOPMENT PURPOSES.

    (a) In General.--Subparagraph (A) of section 41(e)(7) of the 
Internal Revenue Code of 1986 (defining basic research) is amended by 
striking ``not having a specific commercial objective''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after the date of enactment of this Act.

SEC. 7. FEDERAL LOAN GUARANTEES FOR BUSINESSES COMMERCIALIZING NSF 
              GRANT-FUNDED RESEARCH IDEAS.

    (a) Establishment.--The Secretary of Commerce shall establish a 
program to provide loan guarantees for obligations to small- or medium-
sized businesses to assist them in making commercial use of products, 
processes, or ideas generated by research grants funded by the National 
Science Foundation.
    (b) Eligible Projects.--A loan guarantee may be made under the 
program only for a project that enables a small- or medium-sized 
business in the United States--
            (1) to use an innovative product, process, or idea that was 
        developed by research funded in whole or in part by a grant 
        from the National Science Foundation; and
            (2) to develop, implement, market, or otherwise make use of 
        that product, process, or idea for commercial purposes.
    (c) Eligible Borrower.--A loan guarantee may be made under the 
program only for a borrower who is a small- or medium-sized business, 
as determined by the Secretary under the criteria established pursuant 
to subsection (m).
    (d) Limitation on Amount.--A loan guarantee shall not exceed an 
amount equal to 80 percent of the obligation, as estimated at the time 
at which the loan guarantee is issued.
    (e) Limitations on Loan Guarantee.--No loan guarantee shall be made 
unless the Secretary determines that--
            (1) there is a reasonable prospect of repayment of the 
        principal and interest on the obligation by the borrower;
            (2) the amount of the obligation (when combined with 
        amounts available to the borrower from other sources) is 
        sufficient to carry out the project;
            (3) the obligation is not subordinate to other financing;
            (4) the obligation bears interest at a rate that does not 
        exceed a level that the Secretary determines appropriate, 
        taking into account the prevailing rate of interest in the 
        private sector for similar loans and risks; and
            (5) the term of an obligation requires full repayment over 
        a period not to exceed the lesser of--
                    (A) 30 years; or
                    (B) 90 percent of the projected useful life, as 
                determined by the Secretary, of the asset to be 
                financed by the obligation.
    (f) Penalty for Relocation Outside of United States.--The loan 
agreement shall contain a provison that requires that, if the recipient 
of the loan relocates more than 25 percent of the business activities 
for which the loan was received outside the United States during the 
term of the loan, the recipient is required to repay the remainder of 
such loan--
            (1) with interest at a penalty rate determined by the 
        Secretary before the issuance of the loan and in consultation 
        with the lender to deter the recipient of the loan from 
        relocating such activities outside the United States; and
            (2) for a duration determined by the Secretary in 
        consultation with the lender.
    (g) Defaults.--
            (1) Payment by secretary.--
                    (A) In general.--If a borrower defaults (as defined 
                in regulations promulgated by the Secretary and 
                specified in the loan guarantee) on the obligation, the 
                holder of the loan guarantee shall have the right to 
                demand payment of the unpaid amount from the Secretary.
                    (B) Payment required.--Within such period as may be 
                specified in the loan guarantee or related agreements, 
                the Secretary shall pay to the holder of the loan 
                guarantee the unpaid interest on and unpaid principal 
                of the obligation as to which the borrower has 
                defaulted, unless the Secretary finds that there was no 
                default by the borrower in the payment of interest or 
                principal or that the default has been remedied.
                    (C) Forbearance.--Nothing in this subsection 
                precludes any forbearance by the holder of the 
                obligation for the benefit of the borrower which may be 
                agreed upon by the parties to the obligation and 
                approved by the Secretary.
            (2) Subrogation.--
                    (A) In general.--If the Secretary makes a payment 
                under paragraph (1), the Secretary shall be subrogated 
                to the rights, as specified in the loan guarantee, of 
                the recipient of the payment or related agreements 
                including, if appropriate, the authority 
                (notwithstanding any other provision of law)--
                            (i) to complete, maintain, operate, lease, 
                        or otherwise dispose of any property acquired 
                        pursuant to such loan guarantee or related 
                        agreement; or
                            (ii) to permit the borrower, pursuant to an 
                        agreement with the Secretary, to continue to 
                        pursue the purposes of the project if the 
                        Secretary determines that such an agreement is 
                        in the public interest.
                    (B) Superiority of rights.--The rights of the 
                Secretary, with respect to any property acquired 
                pursuant to a loan guarantee or related agreements, 
                shall be superior to the rights of any other person 
                with respect to the property.
            (3) Notification.--If the borrower defaults on an 
        obligation, the Secretary shall notify the Attorney General of 
        the default.
    (h) Terms and Conditions.--A loan guarantee under this section 
shall include such detailed terms and conditions as the Secretary 
determines appropriate--
            (1) to protect the interests of the United States in the 
        case of default; and
            (2) to have available all the patents and technology 
        necessary for any person selected, including the Secretary, to 
        complete and operate the project.
    (i) Consultation.--In establishing the terms and conditions of a 
loan guarantee under this section, the Secretary shall consult with the 
Secretary of the Treasury.
    (j) Fees.--
            (1) In general.--The Secretary shall charge and collect 
        fees for loan guarantees in amounts the Secretary determines 
        are sufficient to cover applicable administrative expenses.
            (2) Availability.--Fees collected under this subsection 
        shall--
                    (A) be deposited by the Secretary into the Treasury 
                of the United States; and
                    (B) remain available until expended, subject to 
                such other conditions as are contained in annual 
                appropriations Acts.
            (3) Limitation.--In charging and collecting fees under 
        paragraph (1), the Secretary shall take into consideration the 
        amount of the obligation.
    (k) Records.--
            (1) In general.--With respect to a loan guarantee under 
        this section, the borrower, the lender, and any other 
        appropriate party shall keep such records and other pertinent 
        documents as the Secretary shall prescribe by regulation, 
        including such records as the Secretary may require to 
        facilitate an effective audit.
            (2) Access.--The Secretary and the Comptroller General of 
        the United States, or their duly authorized representatives, 
        shall have access to records and other pertinent documents for 
        the purpose of conducting an audit.
    (l) Full Faith and Credit.--The full faith and credit of the United 
States is pledged to the payment of all loan guarantees issued under 
this section with respect to principal and interest.
    (m) Regulations.--The Secretary shall issue final regulations 
before making any loan guarantees under the program. The regulations 
shall include--
            (1) criteria that the Secretary shall use to determine 
        eligibility for loan guarantees under this section, including--
                    (A) whether a borrower is a small- or medium-sized 
                business; and
                    (B) whether a borrower demonstrates that a market 
                exists for the product or that the process will prove 
                commercially successful;
            (2) criteria that the Secretary shall use to determine the 
        amount of any fees charged under subsection (j), including 
        criteria related to the amount of the obligation;
            (3) policies and procedures for selecting and monitoring 
        lenders and loan performance; and
            (4) any other policies, procedures, or information 
        necessary to implement this section.
    (n) Audit.--
            (1) Annual independent audits.--The Secretary shall enter 
        into an arrangement with an independent auditor for annual 
        evaluations of the program under this section.
            (2) Comptroller general review.--The Comptroller General of 
        the United States shall conduct a biennial review of the 
        Secretary's execution of the program under this section.
            (3) Report.--The results of the independent audit under 
        paragraph (1) and the Comptroller General's review under 
        paragraph (2) shall be provided directly to the Committee on 
        Science and Technology of the House of Representatives and the 
        Committee on Commerce, Science, and Transportation of the 
        Senate.
    (o) Report to Congress.--Concurrent with the submission to Congress 
of the President's annual budget request in each year after the date of 
enactment of this Act, the Secretary shall transmit to the Committee on 
Science and Technology of the House of Representatives and the 
Committee on Commerce, Science, and Transportation of the Senate a 
report containing a summary of all activities carried out under this 
section.
    (p) Coordination and Nonduplication.--To the maximum extent 
practicable, the Secretary shall ensure that the activities carried out 
under this section are coordinated with, and do not duplicate the 
efforts of, other loan guarantee programs within the Federal 
Government.
    (q) Minimizing Risk.--The Secretary shall promulgate regulations 
and policies to carry out this section in accordance with Office of 
Management and Budget Circular No. A-129, entitled ``Policies for 
Federal Credit Programs and Non-Tax Receivables'', as in effect on the 
date of enactment of this Act.
    (r) Definitions.--In this section:
            (1) Cost.--The term ``cost'' has the meaning given such 
        term under section 502 of the Federal Credit Reform Act of 1990 
        (2 U.S.C. 661a).
            (2) Loan guarantee.--The term ``loan guarantee'' has the 
        meaning given such term in section 502 of the Federal Credit 
        Reform Act of 1990 (2 U.S.C. 661a). The term includes a loan 
        guarantee commitment (as defined in section 502 of such Act (2 
        U.S.C. 661a)).
            (3) Obligation.--The term ``obligation'' means the loan or 
        other debt obligation that is guaranteed under this section.
            (4) Program.--The term ``program'' means the loan guarantee 
        program established in subsection (a).
    (s) Authorization of Appropriations.--
            (1) Cost of loan guarantees.--There are authorized to be 
        appropriated such sums as are necessary for each of fiscal 
        years 2011 through 2015 to provide the cost of loan guarantees 
        under this section.
            (2) Principal and interest.--There are authorized to be 
        appropriated such sums as are necessary to carry out subsection 
        (g).
American Innovation Act of 2010 - Requires institutions of higher education (IHEs) that receive one or more financial assistance grants from the National Science Foundation (NSF) for research to report to the NSF on: (1) the IHE's strategy for commercializing the results of the research; (2) the implementation of such strategy; and (3) the results of its efforts to realize the commercial potential of the research.

Authorizes the Director of the NSF to use funds appropriated to carry out grants to IHEs for the provision of financial support for post-graduate research in fields of study with potential commercial applications to match any private sector grant of financial assistance to any post-doctoral program in such a field.

 Authorizes the award of grants to IHEs or their consortia for the establishment or expansion of partnerships (including industry or professional association partnerships) with local or regional private sector entities to provide undergraduate students with private sector internship experiences (including manufacturing sector internships) that connect with their STEM coursework.

Requires National Academy of Sciences (NAS) to initiate a study to evaluate, develop, or improve impact-on-society metrics, including the potential for commercial applications of research studies funded by grants from the NSF or other federal agencies.

Amends the Internal Revenue Code to allow the research tax credit for basic research payments made to certain educational and scientific organizations to be made whether or not such research has a specific commercial objective.

 Directs the Secretary of Commerce to establish a program to provide loan guarantees for obligations to borrowers who are small- or medium-sized businesses to assist them in making commercial use of products, processes, or ideas generated by NSF-funded research grants.
A bill to improve the commercialization potential of National Science Foundation grants, enhance the metrics used to assess such potential, and for other purposes.