H. R. 1540—520 
SEC. 4701. DEPARTMENT OF ENERGY NATIONAL SECURITY PROGRAMS 
(In Thousands of Dollars) 
Program 
FY 2012 
Request 
Conference 
Authorized 
Environmental and other defense activities: 
DEFENSE ENVIRONMENTAL CLEANUP ............
5,406,781 
5,023,000 
OTHER DEFENSE ACTIVITIES ..............................
859,952 
823,364 
DEFENSE NUCLEAR WASTE DISPOSAL .............
Total, Environmental & other defense activities ...
6,266,733 
5,846,364 
Total, Atomic Energy Defense Activities .........................
18,049,663 
16,916,696 
Total, Discretionary Funding ...........................................................
18,055,850 
16,916,696 
Electricity Delivery & Energy Reliability 
Infrastructure security & energy restoration .........................
6,187 
Weapons Activities 
Directed stockpile work 
Life extension programs 
B61 Life extension program ..............................................
223,562 
223,562 
W76 Life extension program .............................................
257,035 
257,035 
Total, Life extension programs ..........................................
480,597 
480,597 
Stockpile systems 
B61 Stockpile systems .......................................................
72,396 
72,396 
W76 Stockpile systems ......................................................
63,383 
63,383 
W78 Stockpile systems ......................................................
109,518 
99,518 
W80 Stockpile systems ......................................................
44,444 
44,444 
B83 Stockpile systems .......................................................
48,215 
48,215 
W87 Stockpile systems ......................................................
83,943 
83,943 
W88 Stockpile systems ......................................................
75,728 
75,728 
Total, Stockpile systems ......................................................
497,627 
487,627 
Weapons dismantlement and disposition 
Operations and maintenance ............................................
56,770 
56,770 
Total, Weapons dismantlement and disposition ............
56,770 
56,770 
Stockpile services 
Production support .............................................................
354,502 
330,000 
Research and development support ..................................
30,264 
30,264 
R&D certification and safety .............................................
190,892 
165,569 
Management, technology, and production .......................
198,700 
188,700 
Plutonium sustainment .....................................................
154,231 
140,000 
Total, Stockpile services ......................................................
928,589 
854,533 
Total, Directed stockpile work ..................................................
1,963,583 
1,879,527 
Campaigns: 
Science campaign 
Advanced certification .......................................................
94,929 
40,000 
Primary assessment technologies .....................................
86,055 
86,055 
Dynamic materials properties ...........................................
111,836 
96,984 
Advanced radiography .......................................................
27,058 
26,000 
Secondary assessment technologies ..................................
86,061 
85,000 
Total, Science campaign ......................................................
405,939 
334,039 
Engineering campaign 
Enhanced surety ................................................................
41,696 
41,696 
Weapon systems engineering assessment technology .....
15,663 
15,663 
Nuclear survivability .........................................................
19,545 
19,545 
Enhanced surveillance .......................................................
66,174 
66,174 
Total, Engineering campaign .............................................
143,078 
143,078 
Inertial confinement fusion ignition and high yield 
campaign
H. R. 1540—521 
SEC. 4701. DEPARTMENT OF ENERGY NATIONAL SECURITY PROGRAMS 
(In Thousands of Dollars) 
Program 
FY 2012 
Request 
Conference 
Authorized 
Ignition ...............................................................................
109,888 
109,888 
Diagnostics, cryogenics and experimental support .........
86,259 
86,259 
Pulsed power inertial confinement fusion ........................
4,997 
4,997 
Joint program in high energy density laboratory plas-
mas ..................................................................................
9,100 
9,100 
Facility operations and target production ........................
266,030 
266,030 
Total, Inertial confinement fusion and high yield 
campaign ..............................................................................
476,274 
476,274 
Advanced simulation and computing campaign ...........
628,945 
620,000 
Readiness Campaign 
Nonnuclear readiness ........................................................
65,000 
65,000 
Tritium readiness ...............................................................
77,491 
63,591 
Total, Readiness campaign .................................................
142,491 
128,591 
Total, Campaigns ..........................................................................
1,796,727 
1,701,982 
Readiness in technical base and facilities (RTBF) 
Operations of facilities 
Kansas City Plant ..............................................................
156,217 
156,217 
Lawrence Livermore National Laboratory .......................
83,990 
83,990 
Los Alamos National Laboratory ......................................
318,526 
318,526 
Nevada Test Site ................................................................
97,559 
97,559 
Pantex .................................................................................
164,848 
164,848 
Sandia National Laboratory ..............................................
120,708 
120,708 
Savannah River Site ..........................................................
97,767 
97,767 
Y–12 National security complex .......................................
246,001 
246,001 
Institutional site support ..................................................
199,638 
Total, Operations of facilities .............................................
1,485,254 
1,285,616 
Program readiness ....................................................................
74,180 
74,180 
Material recycle and recovery ..................................................
85,939 
78,000 
Containers ..................................................................................
28,979 
28,979 
Storage .......................................................................................
31,272 
31,272 
Subtotal, Readiness in technical base and facilities ...........
1,705,624 
1,498,047 
Construction: 
12–D–301 TRU waste facilities, LANL ............................
9,881 
9,881 
11–D–801 TA–55 Reinvestment project, LANL ..............
19,402 
10,000 
10-D–501 Nuclear facilities risk reduction Y–12 Na-
tional security complex, Oakridge, TN .........................
35,387 
35,387 
09–D–404 Test capabilities revitalization II, Sandia Na-
tional Laboratories, Albuquerque, NM .........................
25,168 
25,168 
08–D–802 High explosive pressing facility Pantex 
Plant, Amerillo, TX ........................................................
66,960 
66,960 
07–D–140 Project engineering and design (PED) var-
ious locations ..................................................................
3,518 
3,518 
06–D–141 Project engineering & design (PED) Y–12 
National Security Complex, Oakridge, TN ...................
160,194 
160,194 
04–D–125 Chemistry and metallurgy facility replace-
ment project, Los Alamos National Laboratory, Los 
Alamos, NM ....................................................................
300,000 
200,000 
Total, Construction ...............................................................
620,510 
511,108 
Total, Readiness in technical base and facilities .................
2,326,134 
2,009,155 
Secure transportation asset 
Operations and equipment .......................................................
149,274 
145,274 
Program direction .....................................................................
101,998 
98,002 
Total, Secure transportation asset ...........................................
251,272 
243,276 
Nuclear counterterrorism incident response ........................
222,147 
222,147
H. R. 1540—522 
SEC. 4701. DEPARTMENT OF ENERGY NATIONAL SECURITY PROGRAMS 
(In Thousands of Dollars) 
Program 
FY 2012 
Request 
Conference 
Authorized 
Facilities and infrastructure recapitalization program 
Operations and maintenance ...................................................
96,380 
96,380 
Total, Facilities and infrastructure recapitalization pro-
gram ..............................................................................................
96,380 
96,380 
Site stewardship 
Operations and maintenance ...................................................
104,002 
78,680 
Total, Site stewardship ................................................................
104,002 
78,680 
Safeguards and security 
Defense nuclear security 
Operations and maintenance ............................................
711,105 
686,252 
Construction: 
08–D–701 Nuclear materials S&S upgrade project 
Los Alamos National Laboratory ...........................
11,752 
11,752 
Total, Construction ........................................................
11,752 
11,752 
Total, Defense nuclear security .........................................
722,857 
698,004 
Cyber security ...........................................................................
126,614 
126,614 
Total, Safeguards and security .................................................
849,471 
824,618 
National security applications ..................................................
20,000 
10,000 
Subtotal, Weapons activities .............................................................
7,629,716 
7,065,765 
Legacy Contractor Pensions ......................................................
168,232 
Recission .........................................................................................
40,332 
Adjustments 
Use of prior year balances ........................................................
Total, Weapons Activities ...................................................................
7,629,716 
7,274,329 
Defense Nuclear Nonproliferation 
Nonproliferation and verification R&D 
Operations and maintenance ...................................................
417,598 
356,150 
Total, Operations and maintenance .................................
417,598 
356,150 
Total, Nonproliferation & verification R&D ..........................
417,598 
356,150 
Nonproliferation and international security .........................
161,833 
155,305 
International nuclear materials protection and coopera-
tion ................................................................................................
571,639 
571,639 
Fissile materials disposition 
U.S. surplus fissile materials disposition 
Operations and maintenance 
U.S. plutonium disposition .........................................
274,790 
205,632 
U.S. uranium disposition ...........................................
26,435 
26,000 
Total, Operations and maintenance ..........................
301,225 
231,632 
Construction: 
99–D–143 Mixed oxide fuel fabrication facility, Sa-
vannah River, SC ....................................................
385,172 
435,172 
99–D–141–01 Pit disassembly and conversion facil-
ity, Savannah River, SC .........................................
176,000 
99–D–141–02 Waste Solidification Building, Savan-
nah River, SC ..........................................................
17,582 
17,582 
Total, Construction ........................................................
578,754 
452,754 
Total, U.S. surplus fissile materials disposition ............
879,979 
684,386 
Russian surplus materials disposition ....................................
10,174 
1,000 
Total, Fissile materials disposition ..........................................
890,153 
685,386
H. R. 1540—523 
SEC. 4701. DEPARTMENT OF ENERGY NATIONAL SECURITY PROGRAMS 
(In Thousands of Dollars) 
Program 
FY 2012 
Request 
Conference 
Authorized 
Global threat reduction initiative ...................................................
508,269 
500,000 
Legacy contractor pensions ..............................................................
55,823 
Recission ............................................................................................
9,000 
Total, Defense Nuclear Nonproliferation ......................................
2,549,492 
2,333,303 
Naval Reactors 
Naval reactors development 
OHIO replacement reactor systems development ................
121,300 
S8G Prototype refueling .............................................................
99,500 
Naval reactors operations and infrastructure ......................
358,300 
Operation and maintenance 
Operation and maintenance ..............................................
1,069,262 
421,000 
Total, Operation and maintenance ...................................
1,069,262 
1,000,100 
Construction: 
10-D–903, Security upgrades, KAPL ................................
100 
100 
10-D–904, NRF infrastructure upgrades, Idaho ..............
12,000 
12,000 
08–D–190 Expended Core Facility M–290 recovering 
discharge station, Naval Reactor Facility, ID ..............
27,800 
27,800 
Total, Construction ...............................................................
39,900 
39,900 
Total, Naval reactors development ..........................................
1,109,162 
460,900 
Program direction .............................................................................
44,500 
40,000 
Total, Naval Reactors ..........................................................................
1,153,662 
1,080,000 
Office Of The Administrator 
Office of the administrator ..............................................................
450,060 
410,000 
Floor amendment 
Congressionally directed projects ....................................................
Subtotal, Office of the Administrator .............................................
450,060 
410,000 
General Provision 
Section 309–Contractor Pay Freeze ................................................
–27,300 
Security 
Adjustments: 
Use of prior year balances ........................................................
Subtotal, Office of the Administrator .............................................
450,060 
382,700 
Transfer of prior year balances (OMB scoring) ......................
Total, Office Of The Administrator .................................................
450,060 
382,700 
Defense Environmental Cleanup 
Closure sites: 
Closure sites administration ....................................................
5,375 
5,375 
Total, Closure sites .......................................................................
5,375 
5,375 
Hanford site: 
Central plateau remediation ....................................................
546,890 
River corridor and other cleanup operations ..........................
386,822 
Nuclear facility D&D—remainder of Hanford ........................
56,288 
Nuclear facility D&D river corridor closure project ...............
330,534 
Richland community and regulatory support .........................
19,540 
Nuclear material stabilization and disposition PFP ..............
48,458 
SNF stabilization and disposition ............................................
112,250 
Soil and water remediation—groundwater vadose zone ........
222,285 
Solid waste stabilization and disposition 200 area ................
143,897 
Total, Hanford site ........................................................................
913,712 
953,252 
Idaho National Laboratory:
H. R. 1540—524 
SEC. 4701. DEPARTMENT OF ENERGY NATIONAL SECURITY PROGRAMS 
(In Thousands of Dollars) 
Program 
FY 2012 
Request 
Conference 
Authorized 
Idaho cleanup and waste disposition .......................................
382,769 
SNF stabilization and disposition—2012 ................................
20,114 
Solid waste stabilization and disposition ................................
165,035 
Radioactive liquid tank waste stabilization and disposition
110,169 
Soil and water remediation—2012 ..........................................
87,451 
Idaho community and regulatory support ...............................
4,100 
Total, Idaho National Laboratory .............................................
382,769 
386,869 
NNSA sites 
NNSA sites and Nevada off-sites .............................................
282,393 
Lawrence Livermore National Laboratory ..............................
873 
Nuclear facility D & D Separations Process Research Unit ..
1,500 
Nevada .......................................................................................
63,380 
Los Alamos National Laboratory .............................................
357,939 
Sandia National Laboratory 
Total, NNSA sites and Nevada off-sites ...................................
423,692 
282,393 
Oak Ridge Reservation: 
Building 3019 ............................................................................
37,000 
OR nuclear facility D&D ..........................................................
69,100 
Nuclear facility D & D ORNL ..................................................
44,000 
Nuclear facility D & D Y–12 ....................................................
30,000 
Nuclear facility D & D, E. Tennessee technology park ..........
100 
OR cleanup and disposition ......................................................
87,000 
OR reservation community and regulatory support Soil and 
water remediation—offsites ..................................................
3,000 
OR reservation community and regulatory support Soil and 
water remediation—offsites ..................................................
6,409 
Solid waste stabilization and disposition—2012 ....................
99,000 
Total, Oak Ridge Reservation ....................................................
176,100 
199,509 
Office of River Protection: 
Waste treatment and immobilization plant 
Waste treatment & immobilization plant 01–D–16 A–D 
363,000 
430,000 
Waste treatment & immobilization plant 01–D–16 E ....
477,000 
310,000 
Total, Waste treatment and immobilization plant ........
840,000 
740,000 
Tank farm activities 
Rad liquid tank waste stabilization and disposition .......
521,391 
445,000 
Total, Tank farm activities ..................................................
521,391 
445,000 
Total, Office of River protection ...............................................
1,361,391 
1,185,000 
Savannah River site: 
Savannah River community and regulatory support .............
9,584 
Nuclear material stabilization and disposition .......................
235,000 
Radioactive liquid tank waste stabilization and disposition
710,487 
667,081 
SR site risk management operations .......................................
343,586 
PE&D Glass Waste Storage Building #3 ................................
3,500 
05–D–405 Salt waste processing facility, Savannah River ....
170,071 
170,071 
Soil and water remediation ......................................................
38,409 
SNF stabilization and disposition ............................................
40,137 
Solid waste stabilization and disposition ................................
30,040 
Total, Savannah River site .........................................................
1,224,144 
1,193,822 
Waste Isolation Pilot Plant 
Waste Isolation Pilot Plant .........................................................
215,134
H. R. 1540—526 
SEC. 5002. DEFINITIONS. 
In this division— 
(1) the terms ‘‘Administration’’ and ‘‘Administrator’’ mean 
the Small Business Administration and the Administrator 
thereof, respectively; 
(2) the terms ‘‘extramural budget’’, ‘‘Federal agency’’, ‘‘Small 
Business Innovation Research Program’’, ‘‘SBIR’’, ‘‘Small Busi-
ness Technology Transfer Program’’, and ‘‘STTR’’ have the 
meanings given such terms in section 9 of the Small Business 
Act (15 U.S.C. 638); and 
(3) the term ‘‘small business concern’’ has the meaning 
given that term under section 3 of the Small Business Act 
(15 U.S.C. 632). 
TITLE LI—SBIR AND STTR 
REAUTHORIZATION 
Subtitle A—Reauthorization of the SBIR and STTR Programs 
Sec. 5101. Extension of termination dates. 
Sec. 5102. SBIR and STTR allocation increase. 
Sec. 5103. SBIR and STTR award levels. 
Sec. 5104. Agency and program flexibility. 
Sec. 5105. Elimination of Phase II invitations. 
Sec. 5106. Pilot to allow phase flexibility. 
Sec. 5107. Participation by firms with substantial investment from multiple ven-
ture capital operating companies, hedge funds, or private equity firms 
in a portion of the SBIR program. 
Sec. 5108. SBIR and STTR special acquisition preference. 
Sec. 5109. Collaborating with Federal laboratories and research and development 
centers. 
Sec. 5110. Notice requirement. 
Sec. 5111. Additional SBIR and STTR awards. 
Subtitle B—Outreach and Commercialization Initiatives 
Sec. 5121. Technical assistance for awardees. 
Sec. 5122. Commercialization Readiness Program at Department of Defense. 
Sec. 5123. Commercialization Readiness Pilot Program for civilian agencies. 
Sec. 5124. Interagency Policy Committee. 
Sec. 5125. Clarifying the definition of ‘‘Phase III’’. 
Sec. 5126. Shortened period for final decisions on proposals and applications. 
Sec. 5127. Phase 0 Proof of Concept Partnership pilot program. 
Subtitle C—Oversight and Evaluation 
Sec. 5131. Streamlining annual evaluation requirements. 
Sec. 5132. Data collection from agencies for SBIR. 
Sec. 5133. Data collection from agencies for STTR. 
Sec. 5134. Public database. 
Sec. 5135. Government database. 
Sec. 5136. Accuracy in funding base calculations. 
Sec. 5137. Continued evaluation by the National Academy of Sciences. 
Sec. 5138. Technology insertion reporting requirements. 
Sec. 5139. Intellectual property protections. 
Sec. 5140. Obtaining consent from SBIR and STTR applicants to release contact in-
formation to economic development organizations. 
Sec. 5141. Pilot to allow funding for administrative, oversight, and contract proc-
essing costs. 
Sec. 5142. GAO study with respect to venture capital operating company, hedge 
fund, and private equity firm involvement. 
Sec. 5143. Reducing vulnerability of SBIR and STTR programs to fraud, waste, and 
abuse. 
Sec. 5144. Simplified paperwork requirements. 
Subtitle D—Policy Directives 
Sec. 5151. Conforming amendments to the SBIR and the STTR Policy Directives.
H. R. 1540—527 
Subtitle E—Other Provisions 
Sec. 5161. Report on SBIR and STTR program goals. 
Sec. 5162. Competitive selection procedures for SBIR and STTR programs. 
Sec. 5163. Loan restrictions. 
Sec. 5164. Limitation on pilot programs. 
Sec. 5165. Commercialization success. 
Sec. 5166. Publication of certain information. 
Sec. 5167. Report on enhancement of manufacturing activities. 
Sec. 5168. Coordination of the SBIR program and the Experimental Program to 
Stimulate Competitive Research. 
Subtitle A—Reauthorization of the SBIR 
and STTR Programs 
SEC. 5101. EXTENSION OF TERMINATION DATES. 
(a) SBIR.—Section 9(m) of the Small Business Act (15 U.S.C. 
638(m)) is amended by striking ‘‘2011’’ and inserting ‘‘2017’’. 
(b) STTR.—Section 9(n)(1)(A) of the Small Business Act (15 
U.S.C. 638(n)(1)(A)) is amended by striking ‘‘2011’’ and inserting 
‘‘2017’’. 
SEC. 5102. SBIR AND STTR ALLOCATION INCREASE. 
(a) SBIR.—Section 9(f) of the Small Business Act (15 U.S.C. 
638(f)) is amended— 
(1) in paragraph (1)— 
(A) in the matter preceding subparagraph (A), by 
striking ‘‘Each’’ and inserting ‘‘Except as provided in para-
graph (2)(B), each’’; 
(B) in subparagraph (B), by striking ‘‘and’’ at the end; 
and 
(C) by striking subparagraph (C) and inserting the 
following: 
‘‘(C) not less than 2.5 percent of such budget in each 
of fiscal years 1997 through 2011; 
‘‘(D) not less than 2.6 percent of such budget in fiscal 
year 2012; 
‘‘(E) not less than 2.7 percent of such budget in fiscal 
year 2013; 
‘‘(F) not less than 2.8 percent of such budget in fiscal 
year 2014; 
‘‘(G) not less than 2.9 percent of such budget in fiscal 
year 2015; 
‘‘(H) not less than 3.0 percent of such budget in fiscal 
year 2016; and 
‘‘(I) not less than 3.2 percent of such budget in fiscal 
year 2017 and each fiscal year thereafter,’’; and 
(2) by adding at the end the following: 
‘‘(4) RULE OF CONSTRUCTION.—Nothing in this subsection 
may be construed to prohibit a Federal agency from expending 
with small business concerns an amount of the extramural 
budget for research or research and development of the agency 
that exceeds the amount required under paragraph (1).’’. 
(b) STTR.—Section 9(n)(1)(B) of the Small Business Act (15 
U.S.C. 638(n)(1)(B)) is amended— 
(1) in clause (i) by striking ‘‘and’’ at the end; and 
(2) by striking clause (ii) and inserting the following: 
‘‘(ii) 0.3 percent for each of fiscal years 2004 
through 2011;
H. R. 1540—528 
‘‘(iii) 0.35 percent for each of fiscal years 2012 
and 2013; 
‘‘(iv) 0.40 percent for each of fiscal years 2014 
and 2015; and 
‘‘(v) 0.45 percent for fiscal year 2016 and each 
fiscal year thereafter.’’. 
SEC. 5103. SBIR AND STTR AWARD LEVELS. 
(a) SBIR ADJUSTMENTS.—Section 9(j)(2)(D) of the Small Busi-
ness Act (15 U.S.C. 638(j)(2)(D)) is amended— 
(1) by striking ‘‘$100,000’’ and inserting ‘‘$150,000’’; and 
(2) by striking ‘‘$750,000’’ and inserting ‘‘$1,000,000’’. 
(b) STTR ADJUSTMENTS.—Section 9(p)(2)(B)(ix) of the Small 
Business Act (15 U.S.C. 638(p)(2)(B)(ix)) is amended— 
(1) by striking ‘‘$100,000’’ and inserting ‘‘$150,000’’; and 
(2) by striking ‘‘$750,000’’ and inserting ‘‘$1,000,000’’. 
(c) ANNUAL ADJUSTMENTS.—Section 9 of the Small Business 
Act (15 U.S.C. 638) is amended— 
(1) in subsection (j)(2)(D), by striking ‘‘once every 5 years 
to reflect economic adjustments and programmatic consider-
ations’’ and inserting ‘‘every year for inflation’’; and 
(2) in subsection (p)(2)(B)(ix), as amended by subsection 
(b) of this section, by inserting ‘‘(each of which the Adminis-
trator shall adjust for inflation annually)’’ after ‘‘$1,000,000,’’. 
(d) LIMITATION ON SIZE OF AWARDS.—Section 9 of the Small 
Business Act (15 U.S.C. 638), as amended by this title, is further 
amended by adding at the end the following: 
‘‘(aa) LIMITATION ON SIZE OF AWARDS.— 
‘‘(1) LIMITATION.—No Federal agency may issue an award 
under the SBIR program or the STTR program if the size 
of the award exceeds the award guidelines established under 
this section by more than 50 percent. 
‘‘(2) MAINTENANCE OF INFORMATION.—Participating agen-
cies shall maintain information on awards exceeding the guide-
lines established under this section, including— 
‘‘(A) the amount of each award; 
‘‘(B) a justification for exceeding the guidelines for 
each award; 
‘‘(C) the identity and location of each award recipient; 
and 
‘‘(D) whether an award recipient has received any ven-
ture capital, hedge fund, or private equity firm investment 
and, if so, whether the recipient is majority-owned by mul-
tiple venture capital operating companies, hedge funds, 
or private equity firms. 
‘‘(3) REPORTS.—The Administrator shall include the 
information described in paragraph (2) in the annual report 
of the Administrator to Congress. 
‘‘(4) WAIVER FOR SPECIFIC TOPIC.—Upon the receipt of an 
application from a Federal agency, the Administrator may grant 
a waiver from the requirement under paragraph (1) with respect 
to a specific topic (but not for the agency as a whole) for 
a fiscal year if the Administrator determines, based on the 
information contained in the application from the agency, that— 
‘‘(A) the requirement under paragraph (1) will interfere 
with the ability of the agency to fulfill its research mission 
through the SBIR program or the STTR program; and
H. R. 1540—529 
‘‘(B) the agency will minimize, to the maximum extent 
possible, the number of awards that do not satisfy the 
requirement under paragraph (1) to preserve the nature 
and intent of the SBIR program and the STTR program. 
‘‘(5) RULE OF CONSTRUCTION.—Nothing in this subsection 
shall be construed to prevent a Federal agency from 
supplementing an award under the SBIR program or the STTR 
program using funds of the Federal agency that are not part 
of the SBIR program or the STTR program of the Federal 
agency.’’. 
SEC. 5104. AGENCY AND PROGRAM FLEXIBILITY. 
Section 9 of the Small Business Act (15 U.S.C. 638), as amended 
by this title, is further amended by adding at the end the following: 
‘‘(bb) SUBSEQUENT PHASE II AWARDS.— 
‘‘(1) AGENCY FLEXIBILITY.—A small business concern that 
received a Phase I award from a Federal agency under this 
section shall be eligible to receive a subsequent Phase II award 
from another Federal agency, if the head of each relevant 
Federal agency or the relevant component of the Federal agency 
makes a written determination that the topics of the relevant 
awards are the same and both agencies report the awards 
to the Administrator for inclusion in the public database under 
subsection (k). 
‘‘(2) SBIR AND STTR PROGRAM FLEXIBILITY.—A small busi-
ness concern that received a Phase I award under this section 
under the SBIR program or the STTR program may receive 
a subsequent Phase II award in either the SBIR program 
or the STTR program and the participating agency or agencies 
shall report the awards to the Administrator for inclusion in 
the public database under subsection (k). 
‘‘(3) PREVENTING DUPLICATIVE AWARDS.—The head of a Fed-
eral agency shall verify that any activity to be performed with 
respect to a project with a Phase I or Phase II SBIR or STTR 
award has not been funded under the SBIR program or STTR 
program of another Federal agency.’’. 
SEC. 5105. ELIMINATION OF PHASE II INVITATIONS. 
Section 9(e) of the Small Business Act (15 U.S.C. 638(e)) is 
amended— 
(1) in paragraph (4)(B), by striking ‘‘to further’’ and 
inserting ‘‘which shall not include any invitation, pre-screening, 
or pre-selection process for eligibility for Phase II, that will 
further’’; and 
(2) in paragraph (6)(B), by striking ‘‘to further develop 
proposed ideas to’’ and inserting ‘‘which shall not include any 
invitation, pre-screening, or pre-selection process for eligibility 
for Phase II, that will further develop proposals that’’. 
SEC. 5106. PILOT TO ALLOW PHASE FLEXIBILITY. 
Section 9 of the Small Business Act (15 U.S.C. 638), as amended 
by this title, is further amended by adding at the end the following: 
‘‘(cc) PHASE FLEXIBILITY.—During fiscal years 2012 through 
2017, the National Institutes of Health, the Department of Defense, 
and the Department of Education may each provide to a small 
business concern an award under Phase II of the SBIR program 
with respect to a project, without regard to whether the small 
business concern was provided an award under Phase I of an
H. R. 1540—530 
SBIR program with respect to such project, if the head of the 
applicable agency determines that the small business concern has 
completed the determinations described in subsection (e)(4)(A) with 
respect to such project despite not having been provided a Phase 
I award.’’. 
SEC. 5107. PARTICIPATION BY FIRMS WITH SUBSTANTIAL INVESTMENT 
FROM MULTIPLE VENTURE CAPITAL OPERATING COMPA-
NIES, HEDGE FUNDS, OR PRIVATE EQUITY FIRMS IN A 
PORTION OF THE SBIR PROGRAM. 
(a) IN GENERAL.—Section 9 of the Small Business Act (15 
U.S.C. 638), as amended by this title, is further amended by adding 
at the end the following: 
‘‘(dd) PARTICIPATION OF SMALL BUSINESS CONCERNS MAJORITY- 
OWNED
BY
VENTURE
CAPITAL
OPERATING
COMPANIES, HEDGE 
FUNDS, OR PRIVATE EQUITY FIRMS IN THE SBIR PROGRAM.— 
‘‘(1) AUTHORITY.—Upon providing a written determination 
described in paragraph (2) to the Administrator, the Committee 
on Small Business and Entrepreneurship of the Senate, and 
the Committee on Small Business and the Committee on 
Science, Space, and Technology of the House of Representatives, 
not later than 30 days before the date on which any such 
award is made— 
‘‘(A) the Director of the National Institutes of Health, 
the Secretary of Energy, and the Director of the National 
Science Foundation may award not more than 25 percent 
of the funds allocated for the SBIR program of the 
applicable Federal agency to small business concerns that 
are owned in majority part by multiple venture capital 
operating companies, hedge funds, or private equity firms 
through competitive, merit-based procedures that are open 
to all eligible small business concerns; and 
‘‘(B) the head of a Federal agency other than a Federal 
agency described in subparagraph (A) that participates in 
the SBIR program may award not more than 15 percent 
of the funds allocated for the SBIR program of the Federal 
agency to small business concerns that are owned in 
majority part by multiple venture capital operating compa-
nies, hedge funds, or private equity firms through competi-
tive, merit-based procedures that are open to all eligible 
small business concerns. 
‘‘(2) DETERMINATION.—A written determination described 
in this paragraph is a written determination by the head of 
a Federal agency that explains how the use of the authority 
under paragraph (1) will— 
‘‘(A) induce additional venture capital, hedge fund, or 
private equity firm funding of small business innovations; 
‘‘(B) substantially contribute to the mission of the Fed-
eral agency; 
‘‘(C) demonstrate a need for public research; and 
‘‘(D) otherwise fulfill the capital needs of small business 
concerns for additional financing for SBIR projects. 
‘‘(3) REGISTRATION.—A small business concern that is 
majority-owned by multiple venture capital operating compa-
nies, hedge funds, or private equity firms and qualified for 
participation in the program authorized under paragraph (1) 
shall—
H. R. 1540—531 
‘‘(A) register with the Administrator on the date that 
the small business concern submits an application for an 
award under the SBIR program; and 
‘‘(B) indicate in any SBIR proposal that the small busi-
ness concern is registered under subparagraph (A) as 
majority-owned by multiple venture capital operating 
companies, hedge funds, or private equity firms. 
‘‘(4) COMPLIANCE.— 
‘‘(A) IN GENERAL.—The head of a Federal agency that 
makes an award under this subsection during a fiscal year 
shall collect and submit to the Administrator data relating 
to the number and dollar amount of Phase I awards, Phase 
II awards, and any other category of awards by the Federal 
agency under the SBIR program during that fiscal year. 
‘‘(B) ANNUAL
REPORTING.—The Administrator shall 
include as part of each annual report by the Administration 
under subsection (b)(7) any data submitted under subpara-
graph (A) and a discussion of the compliance of each Fed-
eral agency that makes an award under this subsection 
during the fiscal year with the maximum percentages under 
paragraph (1). 
‘‘(5) ENFORCEMENT.—If a Federal agency awards more than 
the percent of the funds allocated for the SBIR program of 
the Federal agency authorized under paragraph (1) for a pur-
pose described in paragraph (1), the head of the Federal agency 
shall transfer an amount equal to the amount awarded in 
excess of the amount authorized under paragraph (1) to the 
funds for general SBIR programs from the non-SBIR and non- 
STTR research and development funds of the Federal agency 
not later than 180 days after the date on which the Federal 
agency made the award that caused the total awarded under 
paragraph (1) to be more than the amount authorized under 
paragraph (1) for a purpose described in paragraph (1). 
‘‘(6) FINAL DECISIONS ON APPLICATIONS UNDER THE SBIR 
PROGRAM.— 
‘‘(A) DEFINITION.—In this paragraph, the term ‘covered 
small business concern’ means a small business concern 
that— 
‘‘(i) was not majority-owned by multiple venture 
capital operating companies, hedge funds, or private 
equity firms on the date on which the small business 
concern submitted an application in response to a 
solicitation under the SBIR programs; and 
‘‘(ii) on the date of the award under the SBIR 
program is majority-owned by multiple venture capital 
operating companies, hedge funds, or private equity 
firms. 
‘‘(B) IN GENERAL.—If a Federal agency does not make 
an award under a solicitation under the SBIR program 
before the date that is 9 months after the date on which 
the period for submitting applications under the solicitation 
ends— 
‘‘(i) a covered small business concern is eligible 
to receive the award, without regard to whether the 
covered small business concern meets the requirements 
for receiving an award under the SBIR program for 
a small business concern that is majority-owned by
H. R. 1540—532 
multiple venture capital operating companies, hedge 
funds, or private equity firms, if the covered small 
business concern meets all other requirements for such 
an award; and 
‘‘(ii) the head of the Federal agency shall transfer 
an amount equal to any amount awarded to a covered 
small business concern under the solicitation to the 
funds for general SBIR programs from the non-SBIR 
and non-STTR research and development funds of the 
Federal agency, not later than 90 days after the date 
on which the Federal agency makes the award. 
‘‘(7) EVALUATION CRITERIA.—A Federal agency may not use 
investment of venture capital or investment from hedge funds 
or private equity firms as a criterion for the award of contracts 
under the SBIR program or STTR program.’’. 
(b) DEFINITIONS.—Section 3 of the Small Business Act (15 
U.S.C. 632) is amended by adding at the end the following: 
‘‘(aa) VENTURE CAPITAL OPERATING COMPANY.—In this Act, the 
term ‘venture capital operating company’ means an entity described 
in clause (i), (v), or (vi) of section 121.103(b)(5) of title 13, Code 
of Federal Regulations (or any successor thereto). 
‘‘(bb) HEDGE FUND.—In this Act, the term ‘hedge fund’ has 
the meaning given that term in section 13(h)(2) of the Bank Holding 
Company Act of 1956 (12 U.S.C. 1851(h)(2)). 
‘‘(cc) PRIVATE EQUITY FIRM.—In this Act, the term ‘private 
equity firm’ has the meaning given the term ‘private equity fund’ 
in section 13(h)(2) of the Bank Holding Company Act of 1956 
(12 U.S.C. 1851(h)(2)).’’. 
(c) RULEMAKING TO ENSURE THAT FIRMS THAT ARE MAJORITY- 
OWNED
BY MULTIPLE VENTURE CAPITAL OPERATING COMPANIES, 
HEDGE FUNDS, OR PRIVATE EQUITY FIRMS ARE ABLE TO PARTICI-
PATE IN A PORTION OF THE SBIR PROGRAM.— 
(1) STATEMENT OF CONGRESSIONAL INTENT.—It is the stated 
intent of Congress that the Administrator should promulgate 
regulations to carry out the authority under section 9(dd) of 
the Small Business Act, as added by this section, that— 
(A) permit small business concerns that are majority- 
owned by multiple venture capital operating companies, 
hedge funds, or private equity firms to participate in the 
SBIR program in accordance with section 9(dd) of the Small 
Business Act; 
(B) provide specific guidance for small business con-
cerns that are majority-owned by multiple venture capital 
operating companies, hedge funds, or private equity firms 
with regard to eligibility, participation, and affiliation rules; 
and 
(C) preserve and maintain the integrity of the SBIR 
program as a program for small business concerns in the 
United States by prohibiting large businesses or large enti-
ties or foreign-owned businesses or foreign-owned entities 
from participation in the program established under section 
9 of the Small Business Act. 
(2) RULEMAKING REQUIRED.— 
(A) PROPOSED REGULATIONS.—Not later than 120 days 
after the date of enactment of this Act, the Administrator 
shall issue proposed regulations to amend section 121.103 
(relating to determinations of affiliation applicable to the
H. R. 1540—533 
SBIR program) and section 121.702 (relating to ownership 
and control standards and size standards applicable to 
the SBIR program) of title 13, Code of Federal Regulations, 
for firms that are majority-owned by multiple venture cap-
ital operating companies, hedge funds, or private equity 
firms and participating in the SBIR program solely under 
the authority under section 9(dd) of the Small Business 
Act, as added by this section. 
(B) FINAL REGULATIONS.—Not later than 1 year after 
the date of enactment of this Act, and after providing 
notice of and opportunity for comment on the proposed 
regulations issued under subparagraph (A), the Adminis-
trator shall issue final or interim final regulations under 
this subsection. 
(3) CONTENTS.— 
(A) IN GENERAL.—The regulations issued under this 
subsection shall permit the participation of applicants 
majority-owned by multiple venture capital operating 
companies, hedge funds, or private equity firms in the 
SBIR program in accordance with section 9(dd) of the Small 
Business Act, as added by this section, unless the Adminis-
trator determines— 
(i) in accordance with the size standards estab-
lished under subparagraph (B), that the applicant is— 
(I) a large business or large entity; or 
(II) majority-owned or controlled by a large 
business or large entity; or 
(ii) in accordance with the criteria established 
under subparagraph (C), that the applicant— 
(I) is a foreign-owned business or a foreign 
entity or is not a citizen of the United States 
or alien lawfully admitted for permanent resi-
dence; or 
(II) is majority-owned or controlled by a for-
eign-owned business, foreign entity, or person who 
is not a citizen of the United States or alien law-
fully admitted for permanent residence. 
(B) SIZE STANDARDS.—Under the authority to establish 
size standards under paragraphs (2) and (3) of section 
3(a) of the Small Business Act (15 U.S.C. 632(a)), the 
Administrator shall, in accordance with paragraph (1) of 
this subsection, establish size standards for applicants 
seeking to participate in the SBIR program solely under 
the authority under section 9(dd) of the Small Business 
Act, as added by this section. 
(C) CRITERIA FOR DETERMINING FOREIGN OWNERSHIP.— 
The Administrator shall establish criteria for determining 
whether an applicant meets the requirements under 
subparagraph (A)(ii), and, in establishing the criteria, shall 
consider whether the criteria should include— 
(i) whether the applicant is at least 51 percent 
owned or controlled by citizens of the United States 
or domestic venture capital operating companies, hedge 
funds, or private equity firms; 
(ii) whether the applicant is domiciled in the 
United States; and
H. R. 1540—534 
(iii) whether the applicant is a direct or indirect 
subsidiary of a foreign-owned firm, including whether 
the criteria should include that an applicant is a direct 
or indirect subsidiary of a foreign-owned entity if— 
(I) any venture capital operating company, 
hedge fund, or private equity firm that owns more 
than 20 percent of the applicant is a direct or 
indirect subsidiary of a foreign-owned entity; or 
(II) in the aggregate, entities that are direct 
or indirect subsidiaries of foreign-owned entities 
own more than 49 percent of the applicant. 
(D) CRITERIA
FOR
DETERMINING
AFFILIATION.—The 
Administrator shall establish criteria, in accordance with 
paragraph (1), for determining whether an applicant is 
affiliated with a venture capital operating company, hedge 
fund, private equity firm, or any other business that the 
venture capital operating company, hedge fund, or private 
equity firm has financed and, in establishing the criteria, 
shall specify that— 
(i) if a venture capital operating company, hedge 
fund, or private equity firm that is determined to be 
affiliated with an applicant is a minority investor in 
the applicant, the portfolio companies of the venture 
capital operating company, hedge fund, or private 
equity firm shall not be determined to be affiliated 
with the applicant, unless— 
(I) the venture capital operating company, 
hedge fund, or private equity firm owns a majority 
of the portfolio company; or 
(II) the venture capital operating company, 
hedge fund, or private equity firm holds a majority 
of the seats on the board of directors of the portfolio 
company; 
(ii) subject to clause (i), the Administrator retains 
the authority to determine whether a venture capital 
operating company, hedge fund, or private equity firm 
is affiliated with an applicant, including establishing 
other criteria; 
(iii) the Administrator may not determine that 
a portfolio company of a venture capital operating com-
pany, hedge fund, or private equity firm is affiliated 
with an applicant based solely on 1 or more shared 
investors; and 
(iv) subject to clauses (i), (ii), and (iii), the Adminis-
trator retains the authority to determine whether a 
portfolio company of a venture capital operating com-
pany, hedge fund, or private equity firm is affiliated 
with an applicant based on factors independent of 
whether there is a shared investor, such as whether 
there are contractual obligations between the portfolio 
company and the applicant. 
(4) ENFORCEMENT.—If the Administrator does not issue 
final or interim final regulations under this subsection on or 
before the date that is 1 year after the date of enactment 
of this Act, the Administrator may not carry out or establish 
any pilot program until the date on which the Administrator
H. R. 1540—535 
issues the final or interim final regulations under this sub-
section. 
(5) DEFINITION.—In this subsection, the terms ‘‘venture 
capital operating company’’, ‘‘hedge fund’’, and ‘‘private equity 
firm’’ have the same meaning as in section 3 of the Small 
Business Act (15 U.S.C. 632), as amended by this section. 
(d) ASSISTANCE FOR DETERMINING AFFILIATES.— 
(1) CLEAR EXPLANATION REQUIRED.—Not later than 30 days 
after the date of enactment of this Act, the Administrator 
shall post on the Web site of the Administration (with a direct 
link displayed on the homepage of the Web site of the Adminis-
tration or the SBIR and STTR Web sites of the Administra-
tion)— 
(A) a clear explanation of the SBIR and STTR affili-
ation rules under part 121 of title 13, Code of Federal 
Regulations; and 
(B) contact information for officers or employees of 
the Administration who— 
(i) upon request, shall review an issue relating 
to the rules described in subparagraph (A); and 
(ii) shall respond to a request under clause (i) 
not later than 20 business days after the date on 
which the request is received. 
(2) INCLUSION OF AFFILIATION RULES FOR CERTAIN SMALL 
BUSINESS
CONCERNS.—On and after the date on which the 
final regulations under subsection (c) are issued, the Adminis-
trator shall post on the Web site of the Administration informa-
tion relating to the regulations, in accordance with paragraph 
(1). 
SEC. 5108. SBIR AND STTR SPECIAL ACQUISITION PREFERENCE. 
Section 9(r) of the Small Business Act (15 U.S.C. 638(r)) is 
amended by adding at the end the following: 
‘‘(4) PHASE III AWARDS.—To the greatest extent practicable, 
Federal agencies and Federal prime contractors shall issue 
Phase III awards relating to technology, including sole source 
awards, to the SBIR and STTR award recipients that developed 
the technology.’’. 
SEC. 5109. COLLABORATING WITH FEDERAL LABORATORIES AND 
RESEARCH AND DEVELOPMENT CENTERS. 
Section 9 of the Small Business Act (15 U.S.C. 638), as amended 
by this title, is further amended by adding at the end the following: 
‘‘(ee) COLLABORATING
WITH
FEDERAL
LABORATORIES
AND 
RESEARCH AND DEVELOPMENT CENTERS.— 
‘‘(1) AUTHORIZATION.—Subject to the limitations under this 
section, the head of each participating Federal agency may 
make SBIR and STTR awards to any eligible small business 
concern that— 
‘‘(A) intends to enter into an agreement with a Federal 
laboratory or federally funded research and development 
center for portions of the activities to be performed under 
that award; or 
‘‘(B) has entered into a cooperative research and 
development agreement (as defined in section 12(d) of the 
Stevenson-Wydler Technology Innovation Act of 1980 (15 
U.S.C. 3710a(d))) with a Federal laboratory. 
‘‘(2) PROHIBITION.—No Federal agency shall—
H. R. 1540—536 
‘‘(A) condition an SBIR or STTR award upon entering 
into agreement with any Federal laboratory or any feder-
ally funded laboratory or research and development center 
for any portion of the activities to be performed under 
that award; 
‘‘(B) approve an agreement between a small business 
concern receiving an SBIR or STTR award and a Federal 
laboratory or federally funded laboratory or research and 
development center, if the small business concern performs 
a lesser portion of the activities to be performed under 
that award than required by this section and by the SBIR 
Policy Directive and the STTR Policy Directive of the 
Administrator; or 
‘‘(C) approve an agreement that violates any provision, 
including any data rights protections provision, of this sec-
tion or the SBIR and the STTR Policy Directives. 
‘‘(3) IMPLEMENTATION.—Not later than 180 days after the 
date of enactment of this subsection, the Administrator shall 
modify the SBIR Policy Directive and the STTR Policy Directive 
issued under this section to ensure that small business con-
cerns— 
‘‘(A) have the flexibility to use the resources of the 
Federal laboratories or federally funded research and 
development centers; and 
‘‘(B) are not mandated to enter into agreement with 
any Federal laboratory or any federally funded laboratory 
or research and development center as a condition of an 
award. 
‘‘(4) ADVANCE
PAYMENT.—If a small business concern 
receiving an award under this section enters into an agreement 
with a Federal laboratory or federally funded research and 
development center for portions of the activities to be performed 
under that award, the Federal laboratory or federally funded 
research and development center may not require advance pay-
ment from the small business concern in an amount greater 
than the amount necessary to pay for 30 days of such activi-
ties.’’. 
SEC. 5110. NOTICE REQUIREMENT. 
(a) SBIR PROGRAM.—Section 9(g) of the Small Business Act 
(15 U.S.C. 638(g)) is amended— 
(1) in paragraph (10), by striking ‘‘and’’ at the end; 
(2) in paragraph (11), by striking the period at the end 
and inserting ‘‘; and’’; and 
(3) by adding at the end the following: 
‘‘(12) provide timely notice to the Administrator of any 
case or controversy before any Federal judicial or administrative 
tribunal concerning the SBIR program of the Federal agency.’’. 
(b) STTR PROGRAM.—Section 9(o) of the Small Business Act 
(15 U.S.C. 638(o)) is amended— 
(1) by striking paragraph (15); 
(2) in paragraph (16), by striking the period at the end 
and inserting ‘‘; and’’; 
(3) by redesignating paragraph (16) as paragraph (15); 
and 
(4) by adding at the end the following:
H. R. 1540—537 
‘‘(16) provide timely notice to the Administrator of any 
case or controversy before any Federal judicial or administrative 
tribunal concerning the STTR program of the Federal agency.’’. 
SEC. 5111. ADDITIONAL SBIR AND STTR AWARDS. 
Section 9 of the Small Business Act (15 U.S.C. 638), as amended 
by this title, is further amended by adding at the end the following: 
‘‘(ff) ADDITIONAL SBIR AND STTR AWARDS.— 
‘‘(1) EXPRESS
AUTHORITY
FOR
AWARDING
A
SEQUENTIAL 
PHASE II AWARD.—A small business concern that receives a 
Phase II SBIR award or a Phase II STTR award for a project 
remains eligible to receive 1 additional Phase II SBIR award 
or Phase II STTR award for continued work on that project. 
‘‘(2) PREVENTING DUPLICATIVE AWARDS.—The head of a Fed-
eral agency shall verify that any activity to be performed with 
respect to a project with a Phase I or Phase II SBIR or STTR 
award has not been funded under the SBIR program or STTR 
program of another Federal agency.’’. 
Subtitle B—Outreach and 
Commercialization Initiatives 
SEC. 5121. TECHNICAL ASSISTANCE FOR AWARDEES. 
Section 9(q) of the Small Business Act (15 U.S.C. 638(q)) is 
amended— 
(1) in paragraph (1)— 
(A) by inserting ‘‘or STTR program’’ after ‘‘SBIR pro-
gram’’; and 
(B) by striking ‘‘SBIR projects’’ and inserting ‘‘SBIR 
or STTR projects’’; 
(2) in paragraph (2), by striking ‘‘3 years’’ and inserting 
‘‘5 years’’; and 
(3) in paragraph (3)— 
(A) by striking subparagraph (A) and inserting the 
following: 
‘‘(A) PHASE I.—A Federal agency described in para-
graph (1) may— 
‘‘(i) provide to the recipient of a Phase I SBIR 
or STTR award, through a vendor selected under para-
graph (2), the services described in paragraph (1), in 
an amount equal to not more than $5,000 per year; 
or 
‘‘(ii) authorize the recipient of a Phase I SBIR 
or STTR award to purchase the services described in 
paragraph (1), in an amount equal to not more than 
$5,000 per year, which shall be in addition to the 
amount of the recipient’s award.’’; 
(B) by striking subparagraph (B) and inserting the 
following: 
‘‘(B) PHASE II.—A Federal agency described in para-
graph (1) may— 
‘‘(i) provide to the recipient of a Phase II SBIR 
or STTR award, through a vendor selected under para-
graph (2), the services described in paragraph (1), in 
an amount equal to not more than $5,000 per year; 
or
H. R. 1540—538 
‘‘(ii) authorize the recipient of a Phase II SBIR 
or STTR award to purchase the services described in 
paragraph (1), in an amount equal to not more than 
$5,000 per year, which shall be in addition to the 
amount of the recipient’s award.’’; and 
(C) by adding at the end the following: 
‘‘(C) FLEXIBILITY.—In carrying out subparagraphs (A) 
and (B), each Federal agency shall provide the allowable 
amounts to a recipient that meets the eligibility require-
ments under the applicable subparagraph, if the recipient 
requests to seek technical assistance from an individual 
or entity other than the vendor selected under paragraph 
(2) by the Federal agency. 
‘‘(D) LIMITATION.—A Federal agency may not— 
‘‘(i) use the amounts authorized under subpara-
graph (A) or (B) unless the vendor selected under para-
graph (2) provides the technical assistance to the 
recipient; or 
‘‘(ii) enter a contract with a vendor under para-
graph (2) under which the amount provided for tech-
nical assistance is based on total number of Phase 
I or Phase II awards.’’. 
SEC. 5122. COMMERCIALIZATION READINESS PROGRAM AT DEPART-
MENT OF DEFENSE. 
(a) IN GENERAL.—Section 9(y) of the Small Business Act (15 
U.S.C. 638(y)) is amended— 
(1) in the subsection heading, by striking ‘‘PILOT’’ and 
inserting ‘‘READINESS’’; 
(2) by striking ‘‘Pilot’’ each place that term appears and 
inserting ‘‘Readiness’’; 
(3) in paragraph (1)— 
(A) by inserting ‘‘or Small Business Technology 
Transfer Program’’ after ‘‘Small Business Innovation 
Research Program’’; and 
(B) by adding at the end the following: ‘‘The authority 
to create and administer a Commercialization Readiness 
Program under this subsection may not be construed to 
eliminate or replace any other SBIR program or STTR 
program that enhances the insertion or transition of SBIR 
or STTR technologies, including any such program in effect 
on the date of enactment of the National Defense 
Authorization Act for Fiscal Year 2006 (Public Law 109– 
163; 119 Stat. 3136).’’; 
(4) in paragraph (2), by inserting ‘‘or Small Business Tech-
nology Transfer Program’’ after ‘‘Small Business Innovation 
Research Program’’; 
(5) by striking paragraph (5); 
(6) by striking paragraph (6); and 
(7) by inserting after paragraph (4) the following: 
‘‘(5) INSERTION INCENTIVES.—For any contract with a value 
of not less than $100,000,000, the Secretary of Defense is 
authorized to— 
‘‘(A) establish goals for the transition of Phase III 
technologies in subcontracting plans; and 
‘‘(B) require a prime contractor on such a contract 
to report the number and dollar amount of contracts
H. R. 1540—539 
entered into by that prime contractor for Phase III SBIR 
or STTR projects. 
‘‘(6) GOAL FOR SBIR AND STTR TECHNOLOGY INSERTION.— 
The Secretary of Defense shall— 
‘‘(A) set a goal to increase the number of Phase II 
SBIR contracts and the number of Phase II STTR contracts 
awarded by the Secretary that lead to technology transition 
into programs of record or fielded systems; 
‘‘(B) use incentives in effect on the date of enactment 
of the SBIR/STTR Reauthorization Act of 2011, or create 
new incentives, to encourage agency program managers 
and prime contractors to meet the goal under subparagraph 
(A); and 
‘‘(C) submit to the Administrator for inclusion in the 
annual report under subsection (b)(7)— 
‘‘(i) the number and percentage of Phase II SBIR 
and STTR contracts awarded by the Secretary that 
led to technology transition into programs of record 
or fielded systems; 
‘‘(ii) information on the status of each project that 
received funding through the Commercialization Readi-
ness Program and efforts to transition those projects 
into programs of record or fielded systems; and 
‘‘(iii) a description of each incentive that has been 
used by the Secretary under subparagraph (B) and 
the effectiveness of that incentive with respect to 
meeting the goal under subparagraph (A).’’. 
(b) TECHNICAL AND CONFORMING AMENDMENT.—Section 9(i)(1) 
of the Small Business Act (15 U.S.C. 638(i)(1)) is amended by 
inserting ‘‘(including awards under subsection (y))’’ after ‘‘the 
number of awards’’. 
SEC. 5123. COMMERCIALIZATION READINESS PILOT PROGRAM FOR 
CIVILIAN AGENCIES. 
Section 9 of the Small Business Act (15 U.S.C. 638), as amended 
by this title, is further amended by adding at the end the following: 
‘‘(gg) PILOT PROGRAM.— 
‘‘(1) AUTHORIZATION.—The head of each covered Federal 
agency may allocate not more than 10 percent of the funds 
allocated to the SBIR program and the STTR program of the 
covered Federal agency— 
‘‘(A) for awards for technology development, testing, 
evaluation, and commercialization assistance for SBIR and 
STTR Phase II technologies; or 
‘‘(B) to support the progress of research, research and 
development, and commercialization conducted under the 
SBIR or STTR programs to Phase III. 
‘‘(2) APPLICATION BY FEDERAL AGENCY.— 
‘‘(A) IN GENERAL.—A covered Federal agency may not 
establish a pilot program unless the covered Federal agency 
makes a written application to the Administrator, not later 
than 90 days before the first day of the fiscal year in 
which the pilot program is to be established, that describes 
a compelling reason that additional investment in SBIR 
or STTR technologies is necessary, including unusually 
high regulatory, systems integration, or other costs relating 
to development or manufacturing of identifiable, highly
H. R. 1540—540 
promising small business technologies or a class of such 
technologies expected to substantially advance the mission 
of the agency. 
‘‘(B) DETERMINATION.—The Administrator shall— 
‘‘(i) make a determination regarding an application 
submitted under subparagraph (A) not later than 30 
days before the first day of the fiscal year for which 
the application is submitted; 
‘‘(ii) publish the determination in the Federal Reg-
ister; and 
‘‘(iii) make a copy of the determination and any 
related materials available to the Committee on Small 
Business and Entrepreneurship of the Senate and the 
Committee on Small Business and the Committee on 
Science, Space, and Technology of the House of Rep-
resentatives. 
‘‘(3) MAXIMUM AMOUNT OF AWARD.—The head of a covered 
Federal agency may not make an award under a pilot program 
in excess of 3 times the dollar amounts generally established 
for Phase II awards under subsection (j)(2)(D) or (p)(2)(B)(ix). 
‘‘(4) REGISTRATION.—Any applicant that receives an award 
under a pilot program shall register with the Administrator 
in a registry that is available to the public. 
‘‘(5) AWARD CRITERIA OR CONSIDERATION.—When making 
an award under this section, the head of a covered Federal 
agency shall give consideration to whether the technology to 
be supported by the award is likely to be manufactured in 
the United States. 
‘‘(6) REPORT.—The head of each covered Federal agency 
shall include in the annual report of the covered Federal agency 
to the Administrator an analysis of the various activities consid-
ered for inclusion in the pilot program of the covered Federal 
agency and a statement of the reasons why each activity consid-
ered was included or not included, as the case may be. 
‘‘(7) TERMINATION.—The authority to establish a pilot pro-
gram under this section expires at the end of fiscal year 2017. 
‘‘(8) DEFINITIONS.—In this subsection— 
‘‘(A) the term ‘covered Federal agency’— 
‘‘(i) means a Federal agency participating in the 
SBIR program or the STTR program; and 
‘‘(ii) does not include the Department of Defense; 
and 
‘‘(B) the term ‘pilot program’ means each program 
established under paragraph (1).’’. 
SEC. 5124. INTERAGENCY POLICY COMMITTEE. 
(a) ESTABLISHMENT.—The Director of the Office of Science and 
Technology Policy shall establish an Interagency SBIR/STTR Policy 
Committee. 
(b) MEMBERSHIP.—The Interagency SBIR/STTR Policy Com-
mittee shall include representatives from Federal agencies with 
an SBIR or an STTR program and the Small Business Administra-
tion. 
(c) DUTIES.—The Interagency SBIR/STTR Policy Committee 
shall review the following issues and make policy recommendations 
on ways to improve program effectiveness and efficiency:
H. R. 1540—541 
(1) The public and Government databases described in 
section 9(k) of the Small Business Act (15 U.S.C. 638(k)). 
(2) Federal agency flexibility in establishing Phase I and 
II award sizes, including appropriate criteria for exercising 
such flexibility. 
(3) Commercialization assistance best practices of Federal 
agencies with significant potential to be employed by other 
agencies and the appropriate steps to achieve that leverage, 
as well as proposals for new initiatives to address funding 
gaps that business concerns face after Phase II but before 
commercialization. 
(4) Developing and incorporating a standard evaluation 
framework to enable systematic assessment of SBIR and STTR, 
including through improved tracking of awards and outcomes 
and development of performance measures for the SBIR pro-
gram and STTR program of each Federal agency. 
(5) Outreach and technical assistance activities that 
increase the participation of small businesses underrepresented 
in the SBIR and STTR programs, including the identification 
and sharing of best practices and the leveraging of resources 
in support of such activities across agencies. 
(d) REPORTS.—The Interagency SBIR/STTR Policy Committee 
shall transmit to the Committee on Science, Space, and Technology 
and the Committee on Small Business of the House of Representa-
tives and to the Committee on Small Business and Entrepreneur-
ship of the Senate— 
(1) a report on its review and recommendations under 
subsection (c)(1) not later than 1 year after the date of enact-
ment of this Act; 
(2) a report on its review and recommendations under 
subsection (c)(2) not later than 18 months after the date of 
enactment of this Act; 
(3) a report on its review and recommendations under 
subsection (c)(3) not later than 2 years after the date of enact-
ment of this Act; 
(4) a report on its review and recommendations under 
subsection (c)(4) not later than 2 years after the date of enact-
ment of this Act; and 
(5) a report on its review and recommendations under 
subsection (c)(5) not later than 2 years after the date of enact-
ment of this Act. 
SEC. 5125. CLARIFYING THE DEFINITION OF ‘‘PHASE III’’. 
(a) PHASE III AWARDS.—Section 9(e) of the Small Business 
Act (15 U.S.C. 638(e)), as amended by this title, is further 
amended— 
(1) in paragraph (4)(C), in the matter preceding clause 
(i), by inserting ‘‘for work that derives from, extends, or com-
pletes efforts made under prior funding agreements under the 
SBIR program’’ after ‘‘phase’’; 
(2) in paragraph (6)(C), in the matter preceding clause 
(i), by inserting ‘‘for work that derives from, extends, or com-
pletes efforts made under prior funding agreements under the 
STTR program’’ after ‘‘phase’’; 
(3) in paragraph (8), by striking ‘‘and’’ at the end; 
(4) in paragraph (9), by striking the period at the end 
and inserting a semicolon; and
H. R. 1540—542 
(5) by adding at the end the following: 
‘‘(10) the term ‘commercialization’ means— 
‘‘(A) the process of developing products, processes, tech-
nologies, or services; and 
‘‘(B) the production and delivery (whether by the origi-
nating party or by others) of products, processes, tech-
nologies, or services for sale to or use by the Federal 
Government or commercial markets;’’. 
(b) TECHNICAL AND CONFORMING AMENDMENTS.—Section 9 of 
the Small Business Act (15 U.S.C. 638), as amended by this title, 
is further amended— 
(1) in subsection (e)— 
(A) in paragraph (4)(C)(ii), by striking ‘‘scientific review 
criteria’’ and inserting ‘‘merit-based selection procedures’’; 
(B) in paragraph (9), by striking ‘‘the second or the 
third phase’’ and inserting ‘‘Phase II or Phase III’’; and 
(C) by adding at the end the following: 
‘‘(11) the term ‘Phase I’ means— 
‘‘(A) with respect to the SBIR program, the first phase 
described in paragraph (4)(A); and 
‘‘(B) with respect to the STTR program, the first phase 
described in paragraph (6)(A); 
‘‘(12) the term ‘Phase II’ means— 
‘‘(A) with respect to the SBIR program, the second 
phase described in paragraph (4)(B); and 
‘‘(B) with respect to the STTR program, the second 
phase described in paragraph (6)(B); and 
‘‘(13) the term ‘Phase III’ means— 
‘‘(A) with respect to the SBIR program, the third phase 
described in paragraph (4)(C); and 
‘‘(B) with respect to the STTR program, the third phase 
described in paragraph (6)(C).’’; 
(2) in subsection (j)— 
(A) in paragraph (1)(B), by striking ‘‘phase two’’ and 
inserting ‘‘Phase II’’; 
(B) in paragraph (2)— 
(i) in subparagraph (B)— 
(I) by striking ‘‘the third phase’’ each place 
it appears and inserting ‘‘Phase III’’; and 
(II) by striking ‘‘the second phase’’ and 
inserting ‘‘Phase II’’; 
(ii) in subparagraph (D)— 
(I) by striking ‘‘the first phase’’ and inserting 
‘‘Phase I’’; and 
(II) by striking ‘‘the second phase’’ and 
inserting ‘‘Phase II’’; 
(iii) in subparagraph (F), by striking ‘‘the third 
phase’’ and inserting ‘‘Phase III’’; 
(iv) in subparagraph (G)— 
(I) by striking ‘‘the first phase’’ and inserting 
‘‘Phase I’’; and 
(II) by striking ‘‘the second phase’’ and 
inserting ‘‘Phase II’’; and 
(v) in subparagraph (H)— 
(I) by striking ‘‘the first phase’’ and inserting 
‘‘Phase I’’;
H. R. 1540—543 
(II) by striking ‘‘second phase’’ each place it 
appears and inserting ‘‘Phase II’’; and 
(III) by striking ‘‘third phase’’ and inserting 
‘‘Phase III’’; and 
(C) in paragraph (3)— 
(i) in subparagraph (A)— 
(I) by striking ‘‘the first phase (as described 
in subsection (e)(4)(A))’’ and inserting ‘‘Phase I’’; 
(II) by striking ‘‘the second phase (as described 
in subsection (e)(4)(B))’’ and inserting ‘‘Phase II’’; 
and 
(III) by striking ‘‘the third phase (as described 
in subsection (e)(4)(C))’’ and inserting ‘‘Phase III’’; 
and 
(ii) in subparagraph (B), by striking ‘‘second phase’’ 
and inserting ‘‘Phase II’’; 
(3) in subsection (k)— 
(A) by striking ‘‘first phase’’ each place it appears and 
inserting ‘‘Phase I’’; and 
(B) by striking ‘‘second phase’’ each place it appears 
and inserting ‘‘Phase II’’; 
(4) in subsection (l)(2)— 
(A) by striking ‘‘the first phase’’ and inserting ‘‘Phase 
I’’; and 
(B) by striking ‘‘the second phase’’ and inserting ‘‘Phase 
II’’; 
(5) in subsection (o)(13)— 
(A) in subparagraph (B), by striking ‘‘second phase’’ 
and inserting ‘‘Phase II’’; and 
(B) in subparagraph (C), by striking ‘‘third phase’’ and 
inserting ‘‘Phase III’’; 
(6) in subsection (p)— 
(A) in paragraph (2)(B)— 
(i) in clause (vi)— 
(I) by striking ‘‘the second phase’’ and inserting 
‘‘Phase II’’; and 
(II) by striking ‘‘the third phase’’ and inserting 
‘‘Phase III’’; and 
(ii) in clause (ix)— 
(I) by striking ‘‘the first phase’’ and inserting 
‘‘Phase I’’; and 
(II) by striking ‘‘the second phase’’ and 
inserting ‘‘Phase II’’; and 
(B) in paragraph (3)— 
(i) by striking ‘‘the first phase (as described in 
subsection (e)(6)(A))’’ and inserting ‘‘Phase I’’; 
(ii) by striking ‘‘the second phase (as described 
in subsection (e)(6)(B))’’ and inserting ‘‘Phase II’’; and 
(iii) by striking ‘‘the third phase (as described in 
subsection (e)(6)(C))’’ and inserting ‘‘Phase III’’; 
(7) in subsection (r)— 
(A) in the subsection heading, by striking ‘‘THIRD 
PHASE’’ and inserting ‘‘PHASE III’’; 
(B) in paragraph (1)— 
(i) in the first sentence— 
(I) by striking ‘‘for the second phase’’ and 
inserting ‘‘for Phase II’’;
H. R. 1540—544 
(II) by striking ‘‘third phase’’ and inserting 
‘‘Phase III’’; and 
(III) by striking ‘‘second phase period’’ and 
inserting ‘‘Phase II period’’; and 
(ii) in the second sentence— 
(I) by striking ‘‘second phase’’ and inserting 
‘‘Phase II’’; and 
(II) by striking ‘‘third phase’’ and inserting 
‘‘Phase III’’; and 
(C) in paragraph (2), by striking ‘‘third phase’’ and 
inserting ‘‘Phase III’’; and 
(8) in subsection (u)(2)(B), by striking ‘‘the first phase’’ 
and inserting ‘‘Phase I’’. 
SEC. 5126. SHORTENED PERIOD FOR FINAL DECISIONS ON PROPOSALS 
AND APPLICATIONS. 
(a) IN GENERAL.—Section 9 of the Small Business Act (15 
U.S.C. 638), as amended by this title, is further amended— 
(1) in subsection (g)(4)— 
(A) by inserting ‘‘(A)’’ after ‘‘(4)’’; 
(B) by adding ‘‘and’’ after the semicolon at the end; 
and 
(C) by adding at the end the following: 
‘‘(B) make a final decision on each proposal submitted 
under the SBIR program— 
‘‘(i) not later than 1 year after the date on which 
the applicable solicitation closes, if with respect to the 
National Institutes of Health or the National Science 
Foundation, or 90 days after the date on which the 
applicable solicitation closes, if with respect to any other 
participating agency; or 
‘‘(ii) if the Administrator authorizes an extension with 
respect to a solicitation, not later than 90 days after the 
date that would otherwise be applicable to the agency 
under clause (i);’’; and 
(2) in subsection (o)(4)— 
(A) by inserting ‘‘(A)’’ after ‘‘(4)’’; 
(B) by adding ‘‘and’’ after the semicolon at the end; 
and 
(C) by adding at the end the following: 
‘‘(B) make a final decision on each proposal submitted 
under the STTR program— 
‘‘(i) not later than 1 year after the date on which 
the applicable solicitation closes, if with respect to the 
National Institutes of Health or the National Science 
Foundation, or 90 days after the date on which the 
applicable solicitation closes, if with respect to any other 
participating agency; or 
‘‘(ii) if the Administrator authorizes an extension for 
a solicitation, not later than 90 days after the date that 
would be applicable to the agency under clause (i);’’. 
(b) OTHER TIMING PROVISIONS.—Section 9 of the Small Business 
Act (15 U.S.C. 638), as amended by this title, is further amended 
by adding at the end the following: 
‘‘(hh) TIMING
OF
RELEASE
OF
FUNDING.—Federal agencies 
participating in the SBIR program or STTR program shall, to 
the extent possible, attempt to shorten the amount of time between