H. R. 1540—558 
(2) CONTENT OF AMENDMENTS.—The amendments required 
under paragraph (1) shall include— 
(A) definitions or descriptions of fraud, waste, and 
abuse; 
(B) guidelines for the monitoring and oversight of 
applicants to and recipients of awards under the SBIR 
program or the STTR program; 
(C) a requirement that each Federal agency that 
participates in the SBIR program or STTR program include 
information concerning the method established by the 
Inspector General of the Federal agency to report fraud, 
waste, and abuse (including any telephone hotline or Web- 
based platform)— 
(i) on the Web site of the Federal agency; and 
(ii) in any solicitation or notice of funding oppor-
tunity issued by the Federal agency for the SBIR pro-
gram or the STTR program; and 
(D) a requirement that each applicant for and small 
business concern that receives funding under the SBIR 
program or the STTR program shall certify whether the 
applicant or small business concern is in compliance with 
the laws relating to the SBIR program and the STTR 
program and the conduct guidelines established under the 
SBIR Policy Directive and the STTR Policy Directive. 
(3) CONSULTATION.—The Administrator shall develop, in 
consultation with the Council of Inspectors General on Integrity 
and Efficiency, the procedures and requirements for the certifi-
cation set forth under paragraph (2)(D) after providing notice 
of and an opportunity for public comment on such procedures 
and requirements. 
(4) CERTIFICATION.—The certification developed under 
paragraph (3) may— 
(A) cover the lifecycle of an award to require certifi-
cations at the application, funding, reporting, and closeout 
phases of every SBIR and STTR award; 
(B) require the small business concern to certify compli-
ance with the ‘‘principal investigator primary employment’’ 
requirement, the ‘‘small business concern’’ definition 
requirement, and the ‘‘performance of work’’ requirements 
as set forth in the Directive applicable to the award; 
(C) require the small business concern to disclose 
whether it has applied for, plans to apply for, or received 
an SBIR or STTR award for identical or essentially equiva-
lent work (as defined under the SBIR Policy Directive 
and the STTR Policy Directive), and require the concern 
to certify that the award that it is applying for or obtaining 
funding for is not identical or essentially equivalent to 
work it has performed, or will perform, in connection with 
any other SBIR or STTR award that the concern has 
applied for or received from any other agency except as 
fully disclosed to all funding agencies; and 
(D) require that the small business concern certify 
that it will or did perform the work on the award at 
its facilities with its employees, unless otherwise indicated. 
(5) INSPECTORS GENERAL.—The Inspector General of each 
Federal agency that participates in the SBIR program or STTR
H. R. 1540—559 
program shall cooperate to prevent fraud, waste, and abuse 
in the SBIR program and the STTR program by— 
(A) establishing fraud detection indicators; 
(B) reviewing regulations and operating procedures of 
the Federal agency; 
(C) coordinating information sharing between Federal 
agencies, to the extent otherwise permitted under Federal 
law; and 
(D) improving the education and training of and out-
reach to— 
(i) administrators of the SBIR program and the 
STTR program of the Federal agency; 
(ii) applicants to the SBIR program or the STTR 
program; and 
(iii) recipients of awards under the SBIR program 
or the STTR program. 
(b) STUDY AND REPORT.—Not later than 1 year after the date 
of enactment of this Act to establish a baseline of changes made 
to the program to fight fraud, waste, and abuse, and every 4 
years thereafter to evaluate the effectiveness of the agency strate-
gies, the Comptroller General of the United States shall— 
(1) conduct a study that evaluates— 
(A) the implementation by each Federal agency that 
participates in the SBIR program or the STTR program 
of the amendments to the SBIR Policy Directive and the 
STTR Policy Directive made pursuant to subsection (a); 
(B) the effectiveness of the management information 
system of each Federal agency that participates in the 
SBIR program or STTR program in identifying duplicative 
SBIR and STTR projects; 
(C) the effectiveness of the risk management strategies 
of each Federal agency that participates in the SBIR pro-
gram or STTR program in identifying areas of the SBIR 
program or the STTR program that are at high risk for 
fraud; 
(D) technological tools that may be used to detect pat-
terns of behavior that may indicate fraud by applicants 
to the SBIR program or the STTR program; 
(E) the success of each Federal agency that participates 
in the SBIR program or STTR program in reducing fraud, 
waste, and abuse in the SBIR program or the STTR pro-
gram of the Federal agency; 
(F) the extent to which the Inspector General of each 
Federal agency that participates in the SBIR and STTR 
program effectively conducts investigations, audits, inspec-
tions, and outreach relating to the SBIR and STTR pro-
grams of the Federal agency; and 
(G) the effectiveness of the Government and public 
databases described in section 9(k) of the Small Business 
Act (15 U.S.C. 638(k)) in reducing vulnerabilities of the 
SBIR program and the STTR program to fraud, waste, 
and abuse, particularly with respect to Federal agencies 
funding duplicative proposals and business concerns fal-
sifying information in proposals; and 
(2) submit to the Committee on Small Business and 
Entrepreneurship of the Senate, the Committee on Small Busi-
ness and the Committee on Science, Space, and Technology
H. R. 1540—560 
of the House of Representatives, and the head of each Federal 
agency that participates in the SBIR program or STTR program 
a report on the results of the study conducted under paragraph 
(1). 
(c) 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 Business and the Committee 
on Science, Space, and Technology of the House of Representatives 
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; 
(2) the actions taken in each case described in paragraph 
(1) if fraud, waste, or abuse was determined to have occurred; 
(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, including a description of personnel and resources 
funded and funds that were recovered or saved. 
SEC. 5144. SIMPLIFIED PAPERWORK REQUIREMENTS. 
Section 9(v) of the Small Business Act (15 U.S.C. 638(v)) is 
amended— 
(1) in the subsection heading, by striking ‘‘SIMPLIFIED 
REPORTING REQUIREMENTS’’ and inserting ‘‘REDUCING PAPER-
WORK AND COMPLIANCE BURDEN’’; 
(2) by striking ‘‘The Administrator’’ and inserting the fol-
lowing: 
‘‘(1) STANDARDIZATION OF REPORTING REQUIREMENTS.—The 
Administrator’’; and 
(3) by adding at the end the following: 
‘‘(2) SIMPLIFICATION OF APPLICATION AND AWARD PROCESS.— 
Not later than 1 year after the date of enactment of this 
paragraph, and after a period of public comment, the Adminis-
trator shall issue regulations or guidelines, taking into consider-
ation the unique needs of each Federal agency, to ensure that 
each Federal agency required to carry out an SBIR program 
or STTR program simplifies and standardizes the program pro-
posal, selection, contracting, compliance, and audit procedures 
for the SBIR program or STTR program of the Federal agency 
(including procedures relating to overhead rates for applicants 
and documentation requirements) to reduce the paperwork and 
regulatory compliance burden on small business concerns 
applying to and participating in the SBIR program or STTR 
program.’’. 
Subtitle D—Policy Directives 
SEC. 5151. 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 Administrator shall promulgate amend-
ments to the SBIR Policy Directive and the STTR Policy Directive
H. R. 1540—561 
to conform such directives to this title and the amendments made 
by this title. 
(b) PUBLISHING SBIR POLICY DIRECTIVE AND THE STTR POLICY 
DIRECTIVE IN THE FEDERAL REGISTER.—Not later than 180 days 
after the date of enactment of this Act, the Administrator shall 
publish the amended SBIR Policy Directive and the amended STTR 
Policy Directive in the Federal Register. 
Subtitle E—Other Provisions 
SEC. 5161. REPORT ON SBIR AND STTR PROGRAM GOALS. 
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: 
‘‘(nn) 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 effective-
ness and the benefit to the people of the United States of 
the SBIR program and the STTR program of the Federal agency 
that— 
‘‘(A) are science-based and statistically 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 paragraph (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 program 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 appropriate 
committees of Congress and the Administrator an annual 
report describing in detail the results of an evaluation 
conducted under paragraph (2). 
‘‘(B) PUBLIC
AVAILABILITY
OF
REPORT.—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 paragraph, the term ‘appro-
priate committees 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. 5162. COMPETITIVE SELECTION PROCEDURES FOR SBIR AND 
STTR PROGRAMS. 
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: 
‘‘(oo) COMPETITIVE SELECTION PROCEDURES
FOR SBIR AND 
STTR PROGRAMS.—All funds awarded, appropriated, or otherwise
H. R. 1540—562 
made available in accordance with subsection (f) or (n) must be 
awarded pursuant to competitive and merit-based selection proce-
dures.’’. 
SEC. 5163. LOAN RESTRICTIONS. 
Not later than 180 days after the date of enactment of this 
Act, the Administrator shall submit to the Committee on Small 
Business and the Committee on Science, Space, and Technology 
of the House of Representatives and the Committee on Small Busi-
ness and Entrepreneurship of the Senate a report analyzing what 
restrictions, conditions, or covenants contained in a note, bond, 
debenture, other evidence of indebtedness, or preferred stock should 
constitute affiliation under section 121.103(a) of title 13, Code of 
Federal Regulations, for purposes of section 9 of the Small Business 
Act (15 U.S.C. 638). 
SEC. 5164. LIMITATION ON PILOT PROGRAMS. 
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: 
‘‘(pp) LIMITATION ON PILOT PROGRAMS.— 
‘‘(1) EXISTING PILOT PROGRAMS.—The Administrator may 
only carry out a covered pilot program that is in operation 
on the date of enactment of this subsection during the 3- 
year period beginning on such date of enactment. 
‘‘(2) NEW PILOT PROGRAMS.—The Administrator may only 
carry out a covered pilot program established after the date 
of enactment of this subsection— 
‘‘(A) during the 3-year period beginning on the date 
on which such program is established; and 
‘‘(B) if such program does not continue and is not 
based on, in any manner, a previously established covered 
pilot program. 
‘‘(3) COVERED PILOT PROGRAM DEFINED.—In this subsection, 
the term ‘covered pilot program’ means any initiative, project, 
innovation, or other activity— 
‘‘(A) established by the Administrator; 
‘‘(B) relating to an SBIR or STTR program; and 
‘‘(C) not specifically authorized by law.’’. 
SEC. 5165. COMMERCIALIZATION SUCCESS. 
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: 
‘‘(qq) MINIMUM STANDARDS FOR PARTICIPATION.— 
‘‘(1) PROGRESS TO PHASE II SUCCESS.— 
‘‘(A) ESTABLISHMENT OF SYSTEM AND MINIMUM COMMER-
CIALIZATION RATE.—Not later than 1 year after the date 
of enactment of this subsection, the head of each Federal 
agency participating in the SBIR or STTR program shall— 
‘‘(i) establish a system to measure, where appro-
priate, the success of small business concerns with 
respect to the receipt of Phase II SBIR or STTR awards 
for projects that have received Phase I SBIR or STTR 
awards; 
‘‘(ii) establish a minimum performance standard 
for small business concerns with respect to the receipt 
of Phase II SBIR or STTR awards for projects that 
have received Phase I SBIR or STTR awards; and
H. R. 1540—564 
‘‘(B) SUBMISSION OF EVALUATION RESULTS BY AGENCY.— 
The head of each covered Federal agency shall submit 
to the Administrator the results of each evaluation con-
ducted under paragraph (1) or paragraph (2). 
‘‘(4) REQUIREMENT OF NOTICE AND COMMENT.—Each system 
and minimum performance standard established under para-
graph (1) or paragraph (2) and each approval provided by 
the Administrator under paragraph (3)(A), at least 60 days 
before becoming effective, shall be preceded by the provision 
of notice of and an opportunity for public comment on such 
system, standard, or approval.’’. 
SEC. 5166. PUBLICATION OF CERTAIN INFORMATION. 
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: 
‘‘(rr) PUBLICATION
OF CERTAIN INFORMATION.—In order to 
increase the number of small businesses receiving awards under 
the SBIR or STTR programs of participating agencies, and to sim-
plify the application process for such awards, the Administrator 
shall establish and maintain a public Internet Web site 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 participating Federal agency as the Administrator 
determines appropriate.’’. 
SEC. 5167. REPORT ON ENHANCEMENT OF MANUFACTURING ACTIVI-
TIES. 
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: 
‘‘(ss) REPORT ON ENHANCEMENT OF MANUFACTURING ACTIVI-
TIES.—Not later than October 1, 2013, 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 Administrator, for inclusion in the 
annual report required under subsection (b)(7), information that 
includes— 
‘‘(1) a description of efforts undertaken by the head of 
the Federal agency to enhance United States manufacturing 
activities; 
‘‘(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 Execu-
tive Order 13329 (69 Fed. Reg. 9181; relating to encouraging 
innovation in manufacturing); 
‘‘(3) an assessment of the effectiveness of the actions 
described in paragraph (2) at enhancing the research and 
development of United States manufacturing technologies and 
processes; 
‘‘(4) a description of efforts by vendors selected to provide 
discretionary technical assistance under subsection (q)(1) to 
help SBIR and STTR concerns manufacture in the United 
States; and 
‘‘(5) recommendations that the program managers of the 
SBIR or STTR program of the agency consider appropriate 
for additional actions to increase the effectiveness of enhancing 
manufacturing activities.’’.
H. R. 1540—565 
SEC. 5168. COORDINATION OF THE SBIR PROGRAM AND THE EXPERI-
MENTAL 
PROGRAM 
TO 
STIMULATE 
COMPETITIVE 
RESEARCH. 
(a) COORDINATION REQUIRED.—The head of a Federal agency 
that participates in the SBIR program and the Experimental Pro-
gram to Stimulate Competitive Research or the Institutional 
Development Award Program shall coordinate, to the extent pos-
sible, the initiatives of the agency with respect to such programs. 
(b) COORDINATION REPORT.—Not later than 1 year after the 
date of enactment of this Act, the head of each Federal agency 
that participates in the SBIR program and the Experimental Pro-
gram to Stimulate Competitive Research or the Institutional 
Development Award Program shall submit to the Administrator, 
the Committee on Small Business and the Committee on Science, 
Space, and Technology of the House of Representatives, and the 
Committee on Small Business and Entrepreneurship of the Senate 
a report describing the actions taken during the preceding 1-year 
period to increase coordination between such programs to maximize 
existing resources. 
(c) PARTICIPATION REPORT.—Not later than 3 years after the 
date of enactment of this Act, the head of each Federal agency 
that participates in the SBIR program and the Experimental Pro-
gram to Stimulate Competitive Research or the Institutional 
Development Award Program shall submit to the Administrator, 
the Committee on Small Business and the Committee on Science, 
Space, and Technology of the House of Representatives, and the 
Committee on Small Business and Entrepreneurship of the Senate 
a report analyzing whether actions taken to increase the coordina-
tion of such programs have been successful in attracting entre-
preneurs into the SBIR program and increasing the participation 
of States with respect to which a low level of SBIR awards have 
historically been awarded. 
Speaker of the House of Representatives. 
Vice President of the United States and
President of the Senate.