69–010 

Calendar No. 310 

114TH CONGRESS REPORT " ! SENATE 2d Session 114–414 

IMPROVING SMALL BUSINESS INNOVATION AND 

TECHNOLOGIES RESEARCH ACT OF 2015 

DECEMBER 20, 2016.—Ordered to be printed 

Filed, under authority of the order of the Senate of December 10 (legislative day, 

December 9), 2016 

Mr. VITTER, from the Committee on Small Business and 

Entrepreneurship, submitted the following 

R E P O R T 

[To accompany S. 2136] 

The Committee on Small Business and Entrepreneurship, to 

which was referred the bill (S. 2136) to establish the Regional 

SBIR State Collaborative Initiative Pilot Program, and for other 

purposes, having considered the same, reports favorably thereon 

with an amendment, and recommends that the bill, as amended, do 

pass. 

I. INTRODUCTION

The Improving Small Business Innovation and Technologies Research Act of 2015 (S. 2136) was introduced by Senator Vitter, with 

Senator Enzi, on October 6, 2015. Senator Coons is also a cosponsor. 

S. 2136 seeks to amend the Small Business Act to extend the requirement that allows federal agencies required to conduct a Small 

Business Innovation Research (SBIR) Program to use up to 3% of 

its SBIR funds for the administration of its SBIR or Small Business Technology Transfer (STTR) Program as well as other specified costs. 

The bill also establishes the Regional SBIR State Collaborative 

Initiative Pilot Program. This program shall provide one-year renewable awards to a regional collaborative to address the needs of 

small businesses. This shall be done in order for small businesses 

to be more competitive in the proposal and selection process of 

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SBIR and STTR Program awards, and to increase technology transfer and commercialization. 

The legislation also reauthorizes the Federal and State Technology Partnership (FAST) Program. This includes Mentoring Networks and the mentoring database. 

II. HISTORY (PURPOSE AND NEED FOR LEGISLATION)

The Small Business Innovation Research (SBIR) Program was 

created under the Small Business Innovation Development Act of 

1982. SBIR was created in order to increase the role of small businesses in federally funded research and development (R&D) with 

the potential for commercialization. The Program has four main 

goals: to stimulate technological innovation, to meet federal R&D 

needs, to foster participation in innovation by disadvantaged persons, and to increase private-sector commercialization of innovation 

that comes from federal R&D. There are currently eleven federal 

agencies that participate in the SBIR Program. 

The Small Business Technology Transfer (STTR) Program was 

modeled after the SBIR Program as another way to expand opportunities for small businesses to participate in federal R&D projects. 

The program was established by the Small Business Technology 

Transfer Act of 1992 and has been reauthorized numerous times 

since. The major goal of the STTR program is to facilitate the 

transfer of technology through cooperation between research institutions and small businesses. Currently, 5 federal agencies participate in the STTR Program which is administered individually by 

the participating agency. 

The bill addresses two main policy issues. First, it addresses the 

concern raised by stakeholders that federal agencies participating 

in the SBIR and STTR programs did not have assurance that they 

would be able to use program funds to carry out the administrative 

aspects of the programs that they have been charged with running. 

Second, this bill addresses challenges that low participation states 

have had in competing for SBIR/STTR contracts. S. 2136 creates 

the Regional SBIR State Collaborative Initiative Pilot Program. 

These one-year awards of up to $300,000 per state, renewable annually for up to three years, will help small businesses located in 

the bottom half of states for SBIR funding gain the skills needed 

to successfully compete for and win SBIR and STTR grants. S. 

2136 has passed the Committee two times. By unanimous voice 

vote on October 7, 2015, and as part of S. 2812, on May 11, 2016. 

Lastly, the bill extends the FAST program through fiscal year 

2017. The FAST program was created to support the development 

of small high-technology firms, including SBIR and STTR firms, for 

economic development and to increase the number and technological competitiveness of SBIR/STTR applications from small business concerns in low-participation states. A major purpose of the 

program was to increase the geographic disbursement of SBIR and 

STTR projects around the country in a way that would protect the 

competitive integrity of the SBIR and STTR programs instead of 

resorting to state-by-state quotas. Congress wanted to increase the 

applications from the low-award states because of the correlation 

between applications and awards; a study from the U.S. Government Accountability Office (GAO) found that awards were proportionate to applications. Through the FAST program, Small BusiVerDate Sep 11 2014 03:01 Dec 30, 2016 Jkt 069010 PO 00000 Frm 00002 Fmt 6659 Sfmt 6602 E:\HR\OC\SR414.XXX SR414
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1The bill also passed the Committee as part of S. 2812, the SBIR and STTR Reauthorization 

and Improvement Act of 2016, on May 11, 2016. 

ness Development Centers (SBDCs) or state entities, typically with 

expertise in technology transfer and economic development, compete for matching grants. These entities then provide technical assistance to small businesses to apply for and fulfill SBIR and STTR 

contracts, provide general support to build an ecosystem for research and development by small firms, and promote technology 

transfer from university research to technology-based small business concerns. S. 2136 would allow states to compete for FAST and 

the Regional Collaborative pilot, but prohibit any state from receiving assistance from both programs to prevent against fraud. The 

program first appeared in the Consolidated Appropriations Act of 

2001 (15 U.S.C. § 657d(c)). The program was allowed to expire on 

September 30, 2005 but was reestablished in the Consolidated Appropriations Act of 2010. 

III. HEARINGS AND ROUNDTABLES

In the 114th Congress: 

In the 114th Congress, on January 28, 2016, issues related to the 

SBIR and STTR programs and the State Collaborative Initiative 

Pilot Program were addressed at a hearing in the Senate Committee on Small Business and Entrepreneurship entitled ‘‘Reauthorization of the SBIR/STTR Program: The Importance of Small 

Business Innovation to National and Economic Security’’. At the 

hearing, witnesses testified that more personnel were needed to administer the SBIR and STTR programs and that initiatives in the 

state were needed to complement outreach efforts of the 11 SBIR 

agencies and the SBA. Chairman Vitter briefly explained the State 

Collaborative Initiative Pilot Program. 

IV. DESCRIPTION OF BILL

The Improving Small Business Innovative Research and Technologies Act of 2015 (S. 2136) amends the Small Business Act (15 

U.S.C. 638) to establish a pilot program that will be known as the 

Regional SBIR State Collaborative Initiative Pilot Program. The 

Regional SBIR State Collaborative Initiative Pilot Program is designed to provided assistance to SBIR and STTR program participants in a number of ways. S. 2136 describes where the funding 

for the new pilot program will come from and the uses of the funds 

within the new program. 

The legislation also amends section 34 of the Small Business Act 

(15 U.S.C. 657d) by extending the FAST program for 2016 and 

2017. 

V. COMMITTEE VOTE

In compliance with rule XXVI(7)(b) of the Standing Rules of the 

Senate, the following vote was recorded on October 7, 2015.1

A motion to adopt the Improving Small Business Innovative Research and Technologies Act of 2015, was approved unanimously by 

voice vote with the following Senators present: Vitter, Scott, Fischer, Gardner, Ernst, Enzi, Shaheen, Cantwell, Cardin, Booker, 

Hirono, and Peters. 

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VI. COST ESTIMATE

In compliance with rule XXVI(11)(a)(1) of the Standing Rules of 

the Senate, the Committee estimates the cost of the legislation will 

be equal to the amounts discussed in the following letter from the 

Congressional Budget Office: 

JULY 15, 2016. 

Hon. DAVID VITTER, Chairman, 

Committee on Small Business and Entrepreneurship, 

U.S. Senate, Washington, DC. 

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for S. 2136, Improving Small Business Innovative Research and Technologies Act of 2015. 

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contact is Stephen Rabent. 

Sincerely, 

KEITH HALL. 

Enclosure. 

S. 2136—Improving Small Business Innovation and Technologies 

Research Act of 2015 

Summary: S. 2136 would authorize grants for 2017 to facilitate 

collaboration between research institutions and small businesses to 

help small businesses better compete for awards under the Small 

Business Innovation Research (SBIR) and the Small Business 

Technology Transfer (STTR) programs. The bill also would authorize agencies to use a portion of the amounts available to them for 

research and development for the administrative costs of the SBIR 

and STTR programs. Finally, S. 2136 would authorize appropriations for the Federal and State Technology Partnership program. 

Based on information from the Small Business Administration 

(SBA) and agencies that participate in the SBIR and STTR programs, CBO estimates that implementing S. 2136 would cost $23 

million over the 2017–2021 period, assuming appropriation of the 

necessary amounts. Pay-as-you-go procedures do not apply to this 

legislation because enacting it would not affect direct spending or 

revenues. 

CBO estimates that enacting S. 2136 would not increase net direct spending or on-budget deficits in any of the four consecutive 

10-year periods beginning in 2027. 

S. 2136 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act (UMRA). 

Estimated cost to the Federal Government: The estimated budgetary effect of S. 2136 is shown in the following table. The costs 

of this legislation fall within several budget functions including 370 

(commerce), 050 (national defense), 250 (general science, space, and 

technology), and 550 (health). 

By fiscal year, in millions of dollars— 

2017 2018 2019 2020 2021 2017– 

2021 

INCREASES IN SPENDING SUBJECT TO APPROPRIATION 

Regional SBIR and STTR State Collaborative Initiative Pilot 

Program: 

Estimated Authorization Level ............................................. 13 0 0 0 0 13 

5 

By fiscal year, in millions of dollars— 

2017 2018 2019 2020 2021 2017– 

2021 

Estimated Outlays ............................................................... 10 2 1 0 0 13 

Federal and State Technology Partnership Program: 

Authorization Level .............................................................. 10 0 0 0 0 10 

Estimated Outlays ............................................................... 8 2 0 0 0 10 

Total Changes: 

Estimated Authorization Level .................................... 23 0 0 0 0 23 

Estimated Outlays ...................................................... 18 4 1 0 0 23 

Note: SBIR = Small Business Innovation Research; STTR = Small Business Technology Transfer. 

Basis of estimate: Under current law, the SBIR program requires 

federal agencies with extramural budgets for research and development (R&D) that exceed $100 million per year to set aside 3 percent of such funds for contracts with small businesses. (Extramural 

budgets consist of expenditures for activities not performed by 

agency employees.) Likewise, the STTR program requires federal 

agencies with extramural budgets for R&D that exceed $1 billion 

per year to set aside 0.45 percent of that budget for cooperative research between small businesses and a federal laboratory or nonprofit research institution. Eleven agencies currently participate in 

at least one of those programs, including the Departments of Defense, Health and Human Services, Energy, Agriculture, and 

Homeland Security, as well as the National Aeronautics and Space 

Administration, the National Science Foundation, and the Environmental Protection Agency. 

For participating agencies, the cost of those programs consists 

primarily of personnel and associated overhead expenses to solicit 

applications, prepare reports, and track outcomes. The organizational structure of the program offices varies. Some agencies have 

full-time staff members devoted to the SBIR and STTR programs, 

with other staff assisting as part of their duties; other agencies, 

however, have employees working part-time on the program. 

For this estimate, CBO assumes that the bill will be enacted 

near the end of 2016, that the necessary amounts will be appropriated, and that spending will follow historical patterns. 

Regional SBIR and STTR state collaborative initiative pilot program 

S. 2136 would establish a one-year program that would provide 

grants to research institutions and small businesses that collaborate to improve the ability of those small businesses to compete 

successfully for awards under the SBIR and STTR programs. Grant 

recipients would be expected to provide: 

Opportunities for national experts to review the applications of 

small businesses competing for an award under the SBIR or STTR 

programs for the first time; 

Mentors to assist applicants with the process of preparing and 

submitting a proposal for an award; 

Outreach that is focused on certain small businesses, those 

owned and controlled by women, for example; and 

Technical assistance to prepare applicants to compete more effectively for awards. 

For 2017, S. 2136 would authorize each agency to use three percent of its research and development funding dedicated to the SBIR 

program for costs to administer the pilot program. The bill also 

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would authorize the SBA to use a portion of funds dedicated to the 

program by each agency for its administrative costs. Based on information from the SBA and several participating agencies about 

the size of their extramural R&D budgets and their respective administrative costs, CBO estimates that implementing the one-year 

pilot program would cost $13 million over the 2017–2021 period. 

Federal and State Technology Partnership Program 

S. 2136 would authorize the appropriation of $10 million in 2017 

to fund the Federal and State Technology Partnership program. 

That program awards grants to support the efforts of colleges and 

universities and business development centers to provide technical 

assistance and other support to small businesses competing for 

awards under the SBIR and STTR programs. Based on information 

from the SBA and historical spending for the FAST program, CBO 

estimates that implementing this provision of S. 2136 would cost 

$10 million over the 2017–2021 period, assuming appropriation of 

the authorized amounts. 

Pay-as-you-go considerations: None. 

Increase in long-term direct spending and deficits: CBO estimates that enacting the bill would not increase net direct spending 

or on-budget deficits in any of the four consecutive 10-year periods 

beginning in 2027. 

Intergovernmental and private-sector impact: S. 2136 contains no 

intergovernmental or private-sector mandates as defined in UMRA. 

State, local, and tribal governments would benefit from assistance 

for research and other activities related to technology and small 

business. Any cost to those governments would be incurred voluntarily as a condition of receiving federal assistance. 

Estimate prepared by: Federal Costs: Stephen Rabent; Impact on 

State, Local, and Tribal Governments: Leo Lex; Impact on the Private Sector: Logan Smith. 

Estimate approved by: H. Samuel Papenfuss, Deputy Assistant 

Director for Budget. 

VII. EVALUATION OF REGULATORY IMPACT

In compliance with rule XXVI(11)(b) of the Standing Rules of the 

Senate, it is the opinion of the Committee that no significant additional regulatory impact will be incurred in carrying out the provisions of this legislation. There will be no additional impact on the 

personal privacy of companies or individuals who utilize the services provided. 

VIII. SECTION-BY-SECTION ANALYSIS

Section 1: Short title 

This section provides the title the ‘‘Improving Small Business Innovative Research and Technologies Act of 2015.’’ 

Section 2: Regional SBIR State Collaborative Initiative Pilot Program 

Section 2 of S. 2136 extends through fiscal year 2017 the requirement allowing federal agencies that are required to conduct an 

SBIR Program to use up to 3% of its SBIR funding for administraVerDate Sep 11 2014 03:01 Dec 30, 2016 Jkt 069010 PO 00000 Frm 00006 Fmt 6659 Sfmt 6602 E:\HR\OC\SR414.XXX SR414
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tion of its SBIR or STTR Program. This 3% may also be used for 

other administrative, oversight, and processing costs. 

A Regional SBIR State Collaborative Initiative Pilot Program 

will be established. This program will award one-year renewable 

rewards, for up to three years, to a regional collaborative of entities 

frm multiple states. The Pilot Program is designed to address the 

needs of small businesses so that they may be more competitive in 

the proposal and selection for SBIR and STTR awards as well as 

increase the technology transfer and commercialization of those 

projects. 

Section 3: FAST Program 

This section reauthorizes the FAST Program for fiscal year 2017. 

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