I 
116TH CONGRESS 
1ST SESSION H. R. 3774 
To amend the Small Business Act to improve the Small Business Innovation 
Research program and Small Business Technology Transfer program, 
and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JULY 16, 2019 
Mr. BAIRD (for himself, Ms. STEVENS, Mr. BURCHETT, and Mr. CROW) intro-
duced the following bill; which was referred to the Committee on Small 
Business, and in addition to the Committee on Science, Space, and Tech-
nology, for a period to be subsequently determined by the Speaker, in 
each case for consideration of such provisions as fall within the jurisdic-
tion of the committee concerned 
A BILL 
To amend the Small Business Act to improve the Small 
Business Innovation Research program and Small Busi-
ness Technology Transfer program, and for other pur-
poses. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘The Small Business Innovation Research and Small 
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Business Technology Transfer Improvements Act of 
2019’’. 
(b) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows: 
Sec. 1. Short title; table of contents. 
Sec. 2. Requiring insertion incentives. 
Sec. 3. Additional SBIR and STTR technology insertion reporting requirement. 
Sec. 4. Encouraging innovation in United States manufacturing. 
Sec. 5. Encouraging innovation in cybersecurity. 
Sec. 6. Compliance of Phase III awards with competitive procedures. 
Sec. 7. Procurement center representatives and other acquisition personnel in 
the SBIR and STTR programs. 
Sec. 8. Increased outreach requirements. 
Sec. 9. Annual meeting. 
Sec. 10. Establishing the Civilian Agency Commercialization Readiness Pro-
gram. 
Sec. 11. Commercialization assistance pilot programs. 
Sec. 12. Phase 0 Proof of Concept Partnership Pilot Program. 
Sec. 13. Reporting requirements. 
Sec. 14. SBIR Phase flexibility. 
SEC. 2. REQUIRING INSERTION INCENTIVES. 
Section 9(y)(5) of the Small Business Act (15 U.S.C. 
638(y)(5)) is amended by striking ‘‘is authorized to’’ and 
inserting ‘‘shall’’. 
SEC. 3. ADDITIONAL SBIR AND STTR TECHNOLOGY INSER-
TION REPORTING REQUIREMENT. 
Section 9(y)(6) of the Small Business Act (15 U.S.C. 
638(y)(6)) is amended— 
(1) in subparagraph (B), by striking ‘‘and’’ at 
the end; 
(2) in subparagraph (C)(iii), by striking the pe-
riod at the end and inserting ‘‘; and’’; and 
(3) by adding at the end the following new sub-
paragraph: 
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‘‘(D) not later than 120 days after the 
date of the enactment of this subparagraph, 
and not later than December 31 of each year 
thereafter, submit 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 Entrepreneurship of the Senate, a report 
describing the goals set under subparagraph 
(A) and the incentives used or created under 
subparagraph (B).’’. 
SEC. 4. ENCOURAGING INNOVATION IN UNITED STATES 
MANUFACTURING. 
Section 9 of the Small Business Act (15 U.S.C. 638) 
is amended by adding at the end the following new sub-
section: 
‘‘(uu) 
ENCOURAGING
INNOVATION
IN
UNITED 
STATES MANUFACTURING.—In carrying out this section, 
the Administrator shall— 
‘‘(1) ensure that, in selecting small business 
concerns to participate in SBIR or STTR programs 
under this section, Federal agencies give high pri-
ority to small manufacturing companies and other 
small business concerns engaged in or planning to 
engage in manufacturing research and development 
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for the purpose of developing and producing new 
products and technologies in the United States; and 
‘‘(2) include in the annual report to Congress 
under subsection (b)(7) a determination of whether 
the priority described in paragraph (1) is being car-
ried out.’’. 
SEC. 5. ENCOURAGING INNOVATION IN CYBERSECURITY. 
Section 9 of the Small Business Act (15 U.S.C. 638), 
as amended by section 4, is further amended by adding 
at the end the following new subsection: 
‘‘(vv) ENCOURAGING INNOVATION
IN CYBERSECU-
RITY.—In carrying out this section, the Administrator 
shall— 
‘‘(1) ensure that, in selecting small business 
concerns to participate in SBIR or STTR programs 
under this section, Federal agencies engaged in cy-
bersecurity research give high priority to small busi-
ness concerns that are engaged in cybersecurity re-
search and development, for the purpose of devel-
oping and implementing technology services and 
products to strengthen the security of United States 
Government and private computer systems, includ-
ing software, hardware, and portable devices; and 
‘‘(2) include in the annual report to Congress 
under subsection (b)(7) a determination of whether 
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the priority described in paragraph (1) is being car-
ried out.’’. 
SEC. 6. COMPLIANCE OF PHASE III AWARDS WITH COM-
PETITIVE PROCEDURES. 
Section 9(r)(4) of the Small Business Act (15 U.S.C. 
638(r)(4)) is amended by inserting ‘‘as direct follow-on 
awards issued without further competition’’ after ‘‘devel-
oped the technology’’. 
SEC. 7. PROCUREMENT CENTER REPRESENTATIVES AND 
OTHER ACQUISITION PERSONNEL IN THE 
SBIR AND STTR PROGRAMS. 
(a) DEFINITION OF SENIOR PROCUREMENT EXECU-
TIVE.—Section 9(e) of the Small Business Act (15 U.S.C. 
638(e)) is amended— 
(1) in paragraph (12)(B), by striking ‘‘and’’ at 
the end; 
(2) in paragraph (13)(B), by striking the period 
at the end and inserting ‘‘; and’’; and 
(3) by adding at the end the following new 
paragraph: 
‘‘(14) the term ‘senior procurement executive’ 
means an official designated under section 1702(c) 
of title 41, United States Code, as the senior pro-
curement executive of a Federal agency participating 
in a SBIR or STTR program.’’. 
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(b) INCLUSION OF SENIOR PROCUREMENT EXECU-
TIVES IN SBIR AND STTR.— 
(1) IN GENERAL.—Section 9(b) of the Small 
Business Act (15 U.S.C. 638(b)) is amended— 
(A) in paragraph (8), by striking ‘‘and’’ at 
the end; 
(B) in paragraph (9), by striking the pe-
riod at the end and inserting ‘‘; and’’; and 
(C) by adding at the end the following new 
paragraph: 
‘‘(10) to coordinate, where appropriate, with the 
senior procurement executive of the relevant Federal 
agency to assist small business concerns partici-
pating in a SBIR or STTR program with commer-
cializing research developed under such a program 
before such small business concern is awarded a con-
tract from such Federal agency.’’. 
(2) TECHNICAL AMENDMENT.—Section 9(b)(3) 
of the Small Business Act (15 U.S.C. 638(b)(3)) is 
amended by striking ‘‘and’’ at the end. 
(c) MODIFICATIONS RELATING
TO PROCUREMENT 
CENTER REPRESENTATIVES
AND OTHER ACQUISITION 
PERSONNEL.— 
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(1) SBIR AMENDMENT.—Section 9(j) of the 
Small Business Act (15 U.S.C. 638(j)) is amended 
by adding at the end the following new paragraph: 
‘‘(4) MODIFICATIONS RELATING TO PROCURE-
MENT
CENTER
REPRESENTATIVES.—Upon the en-
actment of this paragraph, the Administrator shall 
modify the policy directives issued pursuant to this 
subsection to require procurement center representa-
tives (as described in section 15(l)) to coordinate 
with the appropriate contracting officer or SBIR 
program officer, and the appropriate Director of 
Small and Disadvantaged Business Utilization estab-
lished pursuant to section 15(k) for the agency let-
ting the contract, to assist small business concerns 
participating in the SBIR program, particularly in 
Phase III. The procurement center representatives 
shall coordinate with the appropriate contracting of-
ficer and the appropriate Director of the Office of 
Small and Disadvantaged Business Utilization estab-
lished pursuant to section 15(k) for the agency let-
ting the contract.’’. 
(2) STTR AMENDMENT.—Section 9(p)(2) of 
the Small Business Act (15 U.S.C. 638(p)(2)) is 
amended— 
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(A) in subparagraph (E)(ii), by striking 
‘‘and’’ at the end; 
(B) in subparagraph (F), by striking the 
period at the end and inserting a semicolon; 
and 
(C) by adding at the end the following new 
subparagraph: 
‘‘(G) procedures to ensure that procure-
ment center representatives (as described in 
section 15(l))— 
‘‘(i) coordinate with the appropriate 
contracting officer or STTR program offi-
cer, and the appropriate Director of Small 
and Disadvantaged Business Utilization 
established pursuant to section 15(k) for 
the agency letting the contract, to assist 
small business concerns participating in 
the STTR program, particularly in Phase 
III; and 
‘‘(ii) coordinate with the appropriate 
contracting officer and the appropriate Di-
rector of the Office of Small and Disadvan-
taged Business Utilization established pur-
suant to section 15(k) for the Federal 
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(e) AMENDMENT TO THE DUTIES OF THE DIRECTOR 
OF SMALL AND DISADVANTAGED BUSINESS UTILIZATION 
FOR FEDERAL AGENCIES.—Section 15(k) of the Small 
Business Act (15 U.S.C. 644(k)) is amended— 
(1) in paragraph (19), by striking ‘‘and’’ at the 
end; 
(2) in paragraph (20), by striking the period at 
the end and inserting a semicolon; and 
(3) by adding at the end the following new 
paragraphs: 
‘‘(21) shall coordinate with the appropriate con-
tracting officer of SBIR or STTR program officer to 
assist small business concerns participating in a 
SBIR or STTR program under section 9 with re-
searching applicable solicitations for the award of a 
Federal contract (particularly with the Federal 
agency that has a funding agreement (as defined 
under section 9) with the concern) to market the re-
search developed by such concern under such SBIR 
or STTR program; and 
‘‘(22) shall provide technical assistance to small 
business concerns participating in a SBIR or STTR 
program under section 9 to submit a bid for an 
award of a Federal contract, including coordination 
with procurement center representatives and the ap-
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propriate senior procurement executive for the agen-
cy letting the contract.’’. 
SEC. 8. INCREASED OUTREACH REQUIREMENTS. 
(a) IN GENERAL.— 
(1) SBIR AMENDMENT.—Section 9(j) of the 
Small Business Act (15 U.S.C. 638(j)), as amended 
by section 8, is further amended by adding at the 
end the following new paragraph: 
‘‘(5) INCREASED OUTREACH REQUIREMENTS.— 
Upon the enactment of this paragraph, the Adminis-
trator shall modify the policy directives issued pur-
suant to this subsection to require outreach efforts 
to increase the participation in technological innova-
tion under the SBIR programs among individuals 
conducting research at minority institutions (as de-
fined in section 365(3) of the Higher Education Act 
of 1965) and Hispanic-serving institutions (as de-
fined in section 502(a)(5) of such Act).’’. 
(2) STTR AMENDMENT.—Section 9(p)(2) of 
the Small Business Act (15 U.S.C. 638(p)(2)), as 
amended by section 8, is further amended by adding 
at the end the following new subparagraph: 
‘‘(H) procedures for outreach efforts to in-
crease the participation in technological innova-
tion under the SBIR programs among individ-
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uals conducting research at minority institu-
tions (as defined in section 365(3) of the High-
er Education Act of 1965) and Hispanic-serving 
institutions (as defined in section 502(a)(5) of 
such Act).’’. 
(b) FUNDING FOR OUTREACH.—Section 9(mm)(1) of 
the Small Business Act (15 U.S.C. 638(mm)(1)) is 
amended— 
(1) in subparagraph (I), by striking the ‘‘and’’ 
at the end; 
(2) in subparagraph (J), by striking the period 
at the end and inserting a semicolon; and 
(3) by adding at the end the following new sub-
paragraph: 
‘‘(K) the outreach efforts described under 
subsections (j)(4) and (p)(2)(G); and’’. 
SEC. 9. ANNUAL MEETING. 
(a) IN GENERAL.—Section 9 of the Small Business 
Act (15 U.S.C. 638), as amended by section 5, is further 
amended by adding at the end the following new sub-
section: 
‘‘(ww) ANNUAL MEETING.— 
‘‘(1) IN GENERAL.—The head of each Federal 
agency required to have a program under this sec-
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tion (or a designee) and the Administrator (or a des-
ignee) shall meet annually to discuss methods— 
‘‘(A) to improve the collection of data 
under this section; 
‘‘(B) to improve the reporting of data to 
the Administrator under this section; 
‘‘(C) to make the application processes for 
programs under this section more efficient; and 
‘‘(D) to increase participation in the pro-
grams established under this section. 
‘‘(2) REPORT.—Not later than 60 days after 
the date on which an annual meeting required under 
paragraph (1) is held, the Administrator shall sub-
mit to the Committee on Small Business and Entre-
preneurship of the Senate and the Committee on 
Small Business and the Committee on Science, 
Space, and Technology of the House of Representa-
tives, a report on the findings of such meeting and 
recommendations on how to implement changes to 
programs under this section.’’. 
(b) FUNDING
FOR
ANNUAL
MEETING.—Section 
9(mm)(1) of the Small Business Act (15 U.S.C. 
638(mm)(1)) as amended by section 9, is further amended 
by adding at the end the following new subparagraph: 
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‘‘(L) the annual meeting required under 
subsection (vv).’’. 
SEC. 10. ESTABLISHING THE CIVILIAN AGENCY COMMER-
CIALIZATION READINESS PROGRAM. 
Section 9(gg) of the Small Business Act (15 U.S.C. 
638(gg)) is amended— 
(1) by amending the subsection heading to read 
as follows: ‘‘CIVILIAN AGENCY COMMERCIALIZATION 
READINESS PROGRAM’’; 
(2) in paragraph (1), by inserting ‘‘to establish 
a Civilian Agency Commercialization Readiness Pro-
gram for civilian agencies’’ after ‘‘the covered Fed-
eral agency’’; 
(3) in paragraph (2)(A)— 
(A) by striking ‘‘establish a pilot program’’ 
and inserting ‘‘establish a Civilian Agency Com-
mercialization Readiness Program under this 
subsection’’; and 
(B) by striking ‘‘the pilot program’’ and 
inserting ‘‘such Civilian Agency Commercializa-
tion Readiness Program’’; 
(4) in paragraphs (3) and (4), by striking ‘‘a 
pilot program’’ each place such term appears and in-
serting ‘‘a Civilian Commercialization Readiness 
Program’’; 
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(5) in paragraph (6), by striking ‘‘the pilot pro-
gram’’ and inserting ‘‘a Civilian Agency Commer-
cialization Readiness Program’’; 
(6) by striking paragraph (7) and redesignating 
paragraph (8) as paragraph (7); and 
(7) in paragraph (7) (as so redesignated), by 
amending subparagraph (B) to read as follows: 
‘‘(B) the term ‘Civilian Agency Commer-
cialization Readiness Program’ means each pro-
gram established under paragraph (1).’’. 
SEC. 11. COMMERCIALIZATION ASSISTANCE PILOT PRO-
GRAMS. 
Section 9 of the Small Business Act (15 U.S.C. 638), 
as amended by section 10, is further amended by adding 
at the end the following new subsection: 
‘‘(xx) COMMERCIALIZATION ASSISTANCE PILOT PRO-
GRAMS.— 
‘‘(1) PILOT PROGRAMS IMPLEMENTED.— 
‘‘(A) IN GENERAL.—Except as provided in 
subparagraph (B), not later than one year after 
the date of the enactment of this subsection, a 
covered agency shall implement a commer-
cialization assistance pilot program, under 
which an eligible entity may receive a subse-
quent Phase II SBIR award. 
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‘‘(B) EXCEPTION.—If the Administrator 
determines that a covered agency has a pro-
gram that is sufficiently similar to the commer-
cialization assistance pilot program established 
under this subsection, such covered agency shall 
not be required to implement a commercializa-
tion assistance pilot program under this sub-
section. 
‘‘(2) PERCENT OF AGENCY FUNDS.—The head 
of each covered agency may allocate not more than 
5 percent of the funds allocated to the SBIR pro-
gram of the covered agency for the purpose of mak-
ing a subsequent Phase II SBIR award under the 
commercialization assistance pilot program. 
‘‘(3) TERMINATION.—A commercialization as-
sistance pilot program established under this sub-
section shall terminate on September 30, 2024. 
‘‘(4) APPLICATION.—To be selected to receive a 
subsequent Phase II SBIR award under a commer-
cialization assistance pilot program, an eligible enti-
ty shall submit to the covered agency implementing 
such pilot program an application at such time, in 
such manner, and containing such information as 
the covered agency may require, including— 
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‘‘(A) an updated Phase II commercializa-
tion plan; and 
‘‘(B) the source and amount of the match-
ing funding required under paragraph (5). 
‘‘(5) MATCHING FUNDING.— 
‘‘(A) IN
GENERAL.—The Administrator 
shall require, as a condition of any subsequent 
Phase II SBIR award made to an eligible entity 
under this subsection, that a matching amount 
(excluding any fees collected by the eligible enti-
ty receiving such award) equal to the amount of 
such award be provided from an eligible third- 
party investor. 
‘‘(B) INELIGIBLE
SOURCES.—An eligible 
entity may not use funding from ineligible 
sources to meet the matching requirement of 
subparagraph (A). 
‘‘(6) AWARD.—A subsequent Phase II SBIR 
award made to an eligible entity under this sub-
section— 
‘‘(A) may not exceed the limitation de-
scribed under subsection (aa)(1); and 
‘‘(B) shall be disbursed during Phase II. 
‘‘(7) USE OF FUNDS.—The funds awarded to 
an eligible entity under this subsection may only be 
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used for research and development activities that 
build on eligible entity’s Phase II program and en-
sure the research funded under such Phase II is 
rapidly progressing towards commercialization. 
‘‘(8) SELECTION.—In selecting eligible entities 
to participate in a commercialization assistance pilot 
program under this subsection, the head of a covered 
agency shall consider— 
‘‘(A) the extent to which such award could 
aid the eligible entity in commercializing the re-
search funded under the eligible entity’s Phase 
II program; 
‘‘(B) whether the updated Phase II com-
mercialization plan submitted under paragraph 
(4) provides a sound approach for establishing 
technical feasibility that could lead to commer-
cialization of such research; 
‘‘(C) whether the proposed activities to be 
conducted under such updated Phase II com-
mercialization plan further improve the likeli-
hood that such research will provide societal 
benefits; 
‘‘(D) whether the small business concern 
has progressed satisfactorily in Phase II to jus-
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tify receipt of a subsequent Phase II SBIR 
award; 
‘‘(E) the expectations of the eligible third- 
party investor that provides matching funding 
under paragraph (5); and 
‘‘(F) the likelihood that the proposed ac-
tivities to be conducted under such updated 
Phase II commercialization plan using matching 
funding provided by such eligible third-party in-
vestor will lead to commercial and societal ben-
efit. 
‘‘(9) EVALUATION REPORT.—Not later than 3 
years after the date of the enactment of this sub-
section, the Comptroller General of the United 
States shall submit to the Committee on Science, 
Space, and Technology and the Committee on Small 
Business of the House of Representatives, and the 
Committee on Small Business and Entrepreneurship 
of the Senate, a report including— 
‘‘(A) a summary of the activities of com-
mercialization assistance pilot programs carried 
out under this subsection; 
‘‘(B) a detailed compilation of results 
achieved by such commercialization assistance 
pilot programs, including the number of eligible 
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entities that received awards under such pro-
grams; 
‘‘(C) the rate at which each eligible entity 
that received a subsequent Phase II SBIR 
award under this subsection commercialized re-
search of the recipient; 
‘‘(D) the growth in employment and rev-
enue of eligible entities that is attributable to 
participation in a commercialization assistance 
pilot program; 
‘‘(E) a comparison of commercialization 
success of eligible entities participating in a 
commercialization assistance pilot program with 
recipients of an additional Phase II SBIR 
award under subsection (ff); 
‘‘(F) demographic information, such as 
ethnicity and geographic location, of eligible en-
tities participating in a commercialization as-
sistance pilot program; 
‘‘(G) an accounting of the funds used at 
each covered agency that implements a commer-
cialization assistance pilot program under this 
subsection; 
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‘‘(H) the amount of matching funding pro-
vided by eligible third-party investors, set forth 
separately by source of funding; 
‘‘(I) an analysis of the effectiveness of the 
commercialization assistance pilot program im-
plemented by each covered agency; and 
‘‘(J) recommendations for improvements to 
the commercialization assistance pilot program. 
‘‘(10) DEFINITIONS.—For purposes of this sub-
section: 
‘‘(A) COVERED AGENCY.—The term ‘cov-
ered agency’ means a Federal agency required 
to have an SBIR program. 
‘‘(B) ELIGIBLE ENTITY.—The term ‘eligi-
ble entity’ means a small business concern that 
has received a Phase II award under an SBIR 
program and an additional Phase II SBIR 
award under subsection (ff) from the covered 
agency to which such small business concern is 
applying for a subsequent Phase II SBIR 
award. 
‘‘(C) ELIGIBLE THIRD-PARTY INVESTOR.— 
The term ‘eligible third-party investor’ means a 
small business concern other than an eligible 
entity, a venture capital firm, an individual in-
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vestor, a non-SBIR Federal, State or local gov-
ernment, or any combination thereof. 
‘‘(D) INELIGIBLE
SOURCES.—The term 
‘ineligible sources’ means the following: 
‘‘(i) The eligible entity’s internal re-
search and development funds. 
‘‘(ii) Funding in forms other than 
cash, such as in-kind or other intangible 
assets. 
‘‘(iii) Funding from the owners of the 
eligible entity, or the family members or 
affiliates of such owners. 
‘‘(iv) Funding attained through loans 
or other forms of debt obligations. 
‘‘(E) 
SUBSEQUENT
PHASE
II
SBIR 
AWARD.—The term ‘subsequent Phase II SBIR 
award’ means an award granted to an eligible 
entity under this subsection to carry out further 
commercialization activities for research con-
ducted pursuant to an SBIR program.’’. 
SEC. 12. PHASE 0 PROOF OF CONCEPT PARTNERSHIP PILOT 
PROGRAM. 
Section 9(jj) of the Small Business Act (15 U.S.C. 
638(jj) is amended— 
(1) in paragraph (1)— 
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SEC. 13. REPORTING REQUIREMENTS. 
(a) ANNUAL
REPORT
TO
CONGRESS.—Section 
9(b)(7) of the Small Business Act (15 U.S.C. 638(b)(7)) 
is amended by striking ‘‘to report not less than annually’’ 
and inserting ‘‘to submit a report not later than December 
31 of each year’’. 
(b) ANNUAL REPORT TO SBA AND THE OFFICE OF 
SCIENCE AND TECHNOLOGY POLICY.—Section 9(g)(9) of 
the Small Business Act (15 U.S.C. 638(g)(9)) is amend-
ed— 
(1) by striking ‘‘make an annual report’’ and 
inserting ‘‘not later than March 30 of each year, 
submit a report’’; and 
(2) by striking ‘‘and the Office of Science and 
Technology Policy’’ and inserting ‘‘, the Office of 
Science and Technology Policy, the Committee on 
Science, Space, and Technology and the Committee 
on Small Business of the House of Representatives, 
and the Committee on Small Business and Entrepre-
neurship of the Senate’’. 
SEC. 14. SBIR PHASE FLEXIBILITY. 
Section 9(cc) of the Small Business Act (15 U.S.C. 
638(cc)) is amended by striking ‘‘During fiscal years’’ and 
all that follows through ‘‘may each provide’’ and inserting 
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‘‘During fiscal years 2020 through 2024, all agencies par-
ticipating in the SBIR program may provide’’. 
Æ 
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