186 
spect to Federal agencies funding dupli-
cative proposals and business concerns 
falsifying information in proposals; 
(2) make recommendations with re-
spect to the issues described in para-
graph (1); and 
(3) submit to the head of each agency 
described in section 108(a) of the Small 
Business Reauthorization Act of 2000 (15 
U.S.C. 638 note), 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 a report regarding the 
study conducted under paragraph (1) and 
containing 
the 
recommendations 
de-
scribed in paragraph (2). 
TITLE IV—POLICY DIRECTIVES 
SEC. 401. CONFORMING AMENDMENTS TO THE SBIR AND 
THE STTR POLICY DIRECTIVES. 
(a) IN GENERAL.—Not later than 180 days 
after the date of enactment of this Act, the Ad-
ministrator shall promulgate amendments to 
the SBIR Policy Directive and the STTR Pol-
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icy Directive to conform such directives to 
this Act and the amendments made by this 
Act. 
(b) PUBLISHING
SBIR POLICY
DIRECTIVE 
AND THE STTR POLICY DIRECTIVE IN THE FED-
ERAL REGISTER.—Not later than 180 days after 
the date of enactment of this Act, the Adminis-
trator shall publish the amended SBIR Policy 
Directive and the amended STTR Policy Di-
rective in the Federal Register. 
TITLE V—OTHER PROVISIONS 
SEC. 501. REPORT ON SBIR AND STTR PROGRAM GOALS. 
Section 9 of the Small Business Act (15 
U.S.C. 638), as amended by this Act, is further 
amended by adding at the end the following: 
‘‘(oo) ANNUAL REPORT ON SBIR AND STTR 
PROGRAM GOALS.— 
‘‘(1) DEVELOPMENT
OF
METRICS.—The 
head of each Federal agency required to 
participate in the SBIR program or the 
STTR program shall develop metrics to 
evaluate the effectiveness, and the ben-
efit to the people of the United States, of 
the SBIR program and the STTR program 
of the Federal agency that— 
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‘‘(A) are science-based and statis-
tically driven; 
‘‘(B) reflect the mission of the 
Federal agency; and 
‘‘(C) include factors relating to 
the economic impact of the programs. 
‘‘(2) EVALUATION.—The head of each 
Federal agency described in paragraph 
(1) shall conduct an annual evaluation 
using the metrics developed under para-
graph (1) of— 
‘‘(A) the SBIR program and the 
STTR program of the Federal agency; 
and 
‘‘(B) the benefits to the people of 
the United States of the SBIR pro-
gram and the STTR program of the 
Federal agency. 
‘‘(3) REPORT.— 
‘‘(A) IN
GENERAL.—The head of 
each Federal agency described in 
paragraph (1) shall submit to the ap-
propriate committees of Congress and 
the Administrator an annual report 
describing in detail the results of an 
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evaluation conducted under para-
graph (2). 
‘‘(B) PUBLIC
AVAILABILITY
OF
RE-
PORT.—The head of each Federal 
agency described in paragraph (1) 
shall make each report submitted 
under subparagraph (A) available to 
the public online. 
‘‘(C) DEFINITION.—In this para-
graph, the term ‘appropriate commit-
tees of Congress’ means— 
‘‘(i) the Committee on Small 
Business and Entrepreneurship of 
the Senate; and 
‘‘(ii) the Committee on Small 
Business and the Committee on 
Science, Space, and Technology of 
the House of Representatives.’’. 
SEC. 502. COMPETITIVE SELECTION PROCEDURES FOR 
SBIR AND STTR PROGRAMS. 
Section 9 of the Small Business Act (15 
U.S.C. 638), as amended by this Act, is further 
amended by adding at the end the following: 
‘‘(pp) COMPETITIVE SELECTION PROCEDURES 
FOR SBIR AND STTR PROGRAMS.—All funds 
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awarded, appropriated, or otherwise made 
available in accordance with subsection (f) or 
(n) must be awarded pursuant to competitive 
and merit-based selection procedures.’’. 
SEC. 503. LOAN RESTRICTIONS. 
(a) RULE REQUIRED.—For purposes of sec-
tion 9 of the Small Business Act (15 U.S.C. 
638), the Administrator shall promulgate a 
rule not later than 180 days after the date of 
enactment of this Act that determines what 
restrictions, conditions, or covenants con-
tained in a note, bond, debenture, other evi-
dence of indebtedness, or preferred stock con-
stitute affiliation for purposes of section 
121.103(a) of title 13, Code of Federal Regula-
tions, as in effect on January 1, 2011. 
(b) FAILURE TO PROMULGATE.—If the Ad-
ministrator fails to promulgate a rule in the 
time period required under subsection (a), the 
holder of a note, bond, debenture, other evi-
dence of indebtedness, or preferred stock 
shall be considered to be affiliated with the 
debtor or issuer of the preferred stock until 
such time as the Administrator promulgates 
the rule required under subsection (a). 
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SEC. 504. LIMITATION ON PILOT PROGRAMS. 
Section 9 of the Small Business Act (15 
U.S.C. 638), as amended by this Act, is further 
amended by adding at the end the following: 
‘‘(qq) LIMITATION ON PILOT PROGRAMS.— 
‘‘(1) IN
GENERAL.—The Administrator 
may only carry out a covered pilot pro-
gram if in accordance with paragraphs 
(2) and (3). 
‘‘(2) EXISTING
PILOT
PROGRAMS.—With 
respect to a covered pilot program in op-
eration on the date of enactment of this 
subsection, such program may only be 
carried out during the 3-year period be-
ginning on such date of enactment. 
‘‘(3) NEW
PILOT
PROGRAMS.—With re-
spect to a covered pilot program estab-
lished after the date of enactment of this 
subsection, such program— 
‘‘(A) may only be carried out dur-
ing the 3-year period beginning on 
the date on which such program is es-
tablished; and 
‘‘(B) may not continue or be based 
on, in any manner, a previously es-
tablished covered pilot program. 
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‘‘(4) 
COVERED
PILOT
PROGRAM
DE-
FINED.—In this subsection, the term ‘cov-
ered pilot program’ means any initiative, 
project, innovation, or other activity— 
‘‘(A) relating to an SBIR or STTR 
program; and 
‘‘(B) not specifically authorized by 
law.’’. 
SEC. 505. ENSURING EQUITY IN SBIR AND STTR AWARDS TO 
INDIVIDUAL COMPANIES. 
Section 9 of the Small Business Act (15 
U.S.C. 638), as amended by this Act, is further 
amended by adding at the end the following: 
‘‘(rr) ENSURING EQUITY IN SBIR AND STTR 
AWARDS
TO INDIVIDUAL COMPANIES.—A small 
business concern, including affiliates of the 
small business concern, may not receive an 
SBIR or STTR award in a fiscal year if, at the 
time the award is made— 
‘‘(1) the small business concern has 
received an aggregate dollar amount of 
such awards in such fiscal year that ex-
ceeds 50 percent of the aggregate dollar 
amount of such awards received, in the 
preceding fiscal year, by the median 
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State with respect to such aggregate 
amount; or 
‘‘(2) the small business concern has 
received an aggregate number of such 
awards in such fiscal year that exceeds 
50 percent of the aggregate number of 
such awards received, in the preceding 
fiscal year, by the median State with re-
spect to such aggregate number.’’. 
SEC. 506. INSPECTOR GENERAL REPORTS. 
Not later than October 1 of each year, the 
Inspector General of each Federal agency 
that participates in the SBIR program or 
STTR program shall submit to the Committee 
on Small Business and Entrepreneurship of 
the Senate and the Committee on Small Busi-
ness and the Committee on Science, Space, 
and Technology of the House of Representa-
tives a report describing— 
(1) the number of cases referred to 
the Inspector General in the preceding 
year that related to fraud, waste, or 
abuse with respect to the SBIR program 
or STTR program; 
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(2) the actions taken in each case de-
scribed in paragraph (1) if fraud, waste, 
or abuse was determined to have oc-
curred; 
(3) if no action was taken in a case 
described in paragraph (1) and fraud, 
waste, or abuse was determined to have 
occurred, the justification for action not 
being taken; and 
(4) an accounting of the funds used to 
address fraud, waste, and abuse, includ-
ing a description of personnel and re-
sources funded and funds that were re-
covered or saved. 
SEC. 507. TIMING. 
Federal agencies participating in the 
SBIR program or STTR program shall, to the 
extent possible, attempt to shorten the 
amount of time between the provision of no-
tice of an award under the SBIR program or 
STTR program and the subsequent release of 
funding with respect to the award. 
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SEC. 508. PUBLICATION OF CERTAIN INFORMATION. 
Section 9 of the Small Business Act (15 
U.S.C. 638), as amended by this Act, is further 
amended by adding at the end the following: 
‘‘(ss) PUBLICATION
OF CERTAIN INFORMA-
TION.—In order to increase the number of 
small businesses receiving awards under the 
SBIR or STTR programs of participating 
agencies, and to simplify the application proc-
ess for such awards, the Administrator shall 
establish and maintain a public Internet 
website on which the Administrator shall 
publish such information relating to notice of 
and application for awards under the SBIR 
program and STTR program of each partici-
pating Federal agency as the Administrator 
determines appropriate.’’. 
SEC. 509. PREFERENCE FOR CLEAN COAL TECHNOLOGY 
RESEARCH. 
Section 9 of the Small Business Act (15 
U.S.C. 638), as amended by this Act, is further 
amended by adding at the end the following: 
‘‘(tt) CLEAN COAL TECHNOLOGY RESEARCH 
PREFERENCE.—In making awards under this 
section, a Federal agency shall give priority 
to applications in a manner that increases the 
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number of SBIR and STTR award recipients 
conducting research with respect to clean 
coal technology, including the gasification of 
coal.’’. 
SEC. 510. REPORT ON ENHANCEMENT OF MANUFACTURING 
ACTIVITIES. 
Section 9 of the Small Business Act (15 
U.S.C. 638), as amended by this Act, is further 
amended by adding at the end the following: 
‘‘(uu) REPORT ON ENHANCEMENT OF MANU-
FACTURING ACTIVITIES.—Not later than Octo-
ber 1, 2011, and annually thereafter, the head 
of each Federal agency that makes more than 
$50,000,000 in awards under the SBIR and 
STTR programs of the agency combined shall 
submit to the Committee on Small Business 
and Entrepreneurship of the Senate and the 
Committee on Small Business and the Com-
mittee on Science, Space, and Technology of 
the House of Representatives a report that in-
cludes— 
‘‘(1) a description of efforts under-
taken by the head of the Federal agency 
to enhance manufacturing activities; 
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‘‘(2) a comprehensive description of 
the actions undertaken each year by the 
head of the Federal agency in carrying 
out the SBIR or STTR program of the 
agency in support of Executive Order 
13329 (69 Fed. Reg. 9181; relating to en-
couraging innovation in manufacturing); 
‘‘(3) an assessment of the effective-
ness of the actions described in para-
graph (2) at enhancing the research and 
development 
of 
manufacturing 
tech-
nologies and processes; and 
‘‘(4) recommendations that the pro-
gram managers of the SBIR or STTR pro-
gram of the agency consider appropriate 
for additional actions to increase the ef-
fectiveness of enhancing manufacturing 
activities.’’. 
SEC. 511. EXPRESS AUTHORITY TO ‘‘FAST-TRACK’’ PHASE II 
AWARDS 
FOR 
PROMISING 
PHASE 
I 
RE-
SEARCH. 
Section 9 of the Small Business Act (15 
U.S.C. 638), as amended by this Act, is further 
amended by adding at the end the following: 
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‘‘(vv) AUTHORITY TO ‘FAST-TRACK’ PHASE II 
AWARDS FOR PROMISING PHASE I RESEARCH.— 
To address the delay between an award for 
Phase I of an SBIR program and the applica-
tion for and extension of an award for Phase 
II of such program, each Federal agency with 
an SBIR program may develop ‘fast-track’ 
programs to eliminate such delay by issuing 
Phase II SBIR awards as soon as practicable, 
including 
in 
appropriate 
cases 
simulta-
neously with the issuance of the Phase I SBIR 
award. The Administrator shall encourage the 
development of such ‘fast-track’ programs.’’. 
SEC. 512. INCREASED PARTNERSHIPS BETWEEN SBIR 
AWARDEES AND PRIME CONTRACTORS, VEN-
TURE 
CAPITAL 
INVESTMENT 
COMPANIES, 
AND LARGER BUSINESSES. 
Section 9 of the Small Business Act (15 
U.S.C. 638), as amended by this Act, is further 
amended by adding at the end the following: 
‘‘(ww) INCREASED PARTNERSHIPS.— 
‘‘(1) IN
GENERAL.—Each agency re-
quired by this section to conduct an SBIR 
program shall establish initiatives by 
which the agency encourages partner-
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ships between SBIR awardees and prime 
contractors, venture capital investment 
companies, business incubators, and larg-
er businesses, for the purpose of facili-
tating the progress of the SBIR awardees 
to Phase III. 
‘‘(2) DEFINITION.—In this subsection, 
the term ‘business incubator’ means an 
entity that provides coordinated and spe-
cialized services to entrepreneurial busi-
nesses which meet selected criteria dur-
ing the businesses’ startup phases, in-
cluding providing services such as shared 
office space and office services, access to 
equipment, access to telecommunications 
and technology services, flexible leases, 
specialized management assistance, ac-
cess to financing, mentoring and training 
services, or other coordinated business or 
technical support services designed to 
provide business development assistance 
to 
entrepreneurial 
businesses 
during 
these businesses’ startup phases.’’. 
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SEC. 513. PREFERENCE FOR ACID MINE DRAINAGE RE-
SEARCH. 
Section 9 of the Small Business Act (15 
U.S.C. 638), as amended by this Act, is further 
amended by adding at the end the following: 
‘‘(xx) ACID MINE DRAINAGE RESEARCH PREF-
ERENCE.—In making awards under this sec-
tion, a Federal agency shall give priority to 
applications in a manner that increases the 
number of SBIR and STTR award recipients 
conducting research related to reducing the 
environmental impact, including with respect 
to water quality, of acid mine drainage.’’. 
SEC. 514. PREFERENCE FOR HYDRAULIC FRACTURING RE-
SEARCH. 
Section 9 of the Small Business Act (15 
U.S.C. 638), as amended by this Act, is further 
amended by adding at the end the following: 
‘‘(yy) HYDRAULIC
FRACTURING
RESEARCH 
PREFERENCE.—In making awards under this 
section, a Federal agency shall give priority 
to applications in a manner that increases the 
number of SBIR and STTR award recipients 
conducting research related to reducing the 
environmental impact, including with respect 
to water quality, of the use of hydraulic frac-
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turing during natural gas exploration activi-
ties.’’. 
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Union Calendar No. 85 
112TH CONGRESS 
1ST SESSION 
H. R. 1425 
[Report No. 112–90, Parts I and II] 
A BILL 
To reauthorize and improve the SBIR and STTR 
programs, and for other purposes. 
JULY 1, 2011 
Reported from the Committee on Small Business with an 
amendment 
JULY 1, 2011 
Committee on Armed Services discharged; committed to 
the Committee of the Whole House on the State of the 
Union and ordered to be printed 
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