Small Business Research and Development Enhancement Act of 1992
PL 102-564 (S.2941), enacted 10/28/1992

PUBLIC LAW 102-564—OCT. 28, 1992 
106 STAT. 4249 
Public Law 102-564 
102d Congress 
An Act 
To provide the Administrator of the Small Business Administration continued author-
ity to administer the Small Business Innovation Research Program, and for other 
purposes. 
Be it enacted by the Senate and House of Representatives 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 "Small Business 
Research and Development Enhancement Act of 1992". 
(b) TABLE OF CONTENTS.—The table of contents for this Act 
is as follows: 
Sec. 1. Short title; table of contents. 
TITLE I—SMALL BUSINESS INNOVATION RESEARCH PROGRAM 
Sec. 
Sec. 
Sec. 
Sec. 
101. Short title. 
102. Findings and piuposes. 
103. Amendments to small business innovation research program. 
104. Extension of SBIR program. 
Sec. 105. Reports of the Comptroller General. 
Sec. 106. Recommendations of the Secretary of Defense. 
TITLE II—SMALL BUSINESS TECHNOLOGY TRANSFER PILOT PROGRAM 
Sec. 201. Short title. 
Sec. 202. Establishment of small business technology transfer pilot program. 
TITLE m—MISCELLANEOUS PROVISIONS 
Sec. 301. Discretionary technical assistance to SBIR awardees. 
Sec. 302. Extension of the technology transfer demonstration program. 
Sec. 303. Reporting requirements. 
Sec. 304. Small Business Institutes. 
Sec. 305. Additional SBIR and STTR provisions. 
Sec. 306. Sense of the Congress concerning American-made equipment and prod-
ucts. 
Sec. 307. Technical corrections. 
Oct. 28, 1992 
[S. 2941] 
Small Business 
Research and 
Development 
Enhancement 
Act of 1992. 
15 u s e 631 
note. 
TITLE I—SMALL BUSINESS INNOVATION 
RESEARCH PROGRAM 
SEC. 101. SHORT TITLE. 
This title may be cited as the "Small Business Innovation 
Research Program Reauthorization Act of 1992". 
SEC. 102. FINDINGS AND PURPOSES. 
(a) FINDINGS.—The Congress finds tha1>— 
(1) the small business innovation research program estab-
lished under the Small Business Innovation Development Act 
of 1982 (hereafter in this Act referred to as the "SBIR" program) 
has been a successful method of involving small business con-
cerns in Federal research and development; 
Small Business 
Innovation 
Research 
Program 
Reauthorization 
Act of 1992. 
15 u s e 681 
note. 
15 u s e 638 
note. 
106 STAT. 4250 
PUBLIC LAW 102-564—OCT. 28, 1992 
(2) the small business innovation research program has 
been an effective catalyst for the development of technological 
innovations by small business concerns; 
(3) small business innovation research program partici-
pants have provided high quality research and development 
in a cost-effective manner; 
(4) the innovative products and services developed by small 
business concerns participating in the small business innova-
tion research program have been important to the national 
defense, as well as to the missions of the other participating 
Federal agencies; 
(5) the small business innovation research program has 
effectively stimulated the commercialization of technology 
developed through Federal research and development, benefit-
ing both the public and private sectors of the Nation; 
(6) by encouraging the development and commercialization 
of technological innovations, the small business innovation 
research 
program 
has 
created jobs, expanded 
business 
opportunities for small firms, stimulated the development of 
new products and services, and improved the competitiveness 
of the Nation's high technology industries; 
(7) the small business innovation research program has 
also helped to increase exports from small business concerns; 
(8) despite the general success of the small business innova-
tion research program, the proportion of Federal research and 
development funds received by small business concerns has 
not increased over the life of the program, but has remained 
at 3 percent; and 
(9) although the participating Federal agencies have suc-
cessfully implemented most aspects of the small business 
innovation research program, additional outreach efforts are 
necessary to stimulate increased participation of socially and 
economically disadvantaged small business concerns. 
(b) PURPOSES.—^The purposes of this title are— 
(1) to expand and improve the small business innovation 
research program; 
(2) to emphasize the program's goal of increasing private 
sector commercialization of technology developed through Fed-
eral research and development; 
(3) to increase small business participation in Federal 
research and development; and 
(4) to improve the Federal Government's dissemination 
of information concerning the small business innovation 
research program, particularly with regard to program partici-
pation by women-owned small business concerns and by socially 
and economically disadvantaged smsdl business concerns. 
" 
SEC. 103. AMENDMENTS TO SMALL BUSINESS INNOVATION RESEARCH 
PROGRAM. 
(a) DEFINITION OF THE SMALL BUSINESS INNOVATION RESEARCH 
PROGRAM.—Section 9(e)(4) of the Small Business Act (15 U.S.C. 
638(e)(4)) is amended— 
(1) in subparagraph (A), by inserting "that appear to have 
commercial potential, as described in subparagraph (B)(ii)," 
after "ideas"; and 
(2) by striking subparagraphs (B) and (C) and inserting 
the following: 
PUBLIC LAW 102-564—OCT. 28, 1992 
106 STAT. 4251 
"(B) a second phase, to further develop proposals which 
meet particular program needs, in which awards shall be 
made based on the scientific and technical merit and fea-
sibility of the proposals, as evidenced by the first phase, 
considering, among other things, the proposal's commercial 
potential, as evidenced by— 
"(i) the small business concern's record of success-
fully commercializing SBIR or other research; 
"(ii) the existence of second phase funding commit-
ments from private sector or non-SBIR funding sources; 
"(iii) the existence of third phase, follow-on commit-
ments for the subject of the research; and 
"(iv) the presence of other indicators of the com-
mercial potential of the idea; and 
"(C) where appropriate, a third phase— 
"(i) in which commercial applications of SBIR-
funded research or research and development are 
funded by non-Federal sources of capital or, for prod-
ucts or services intended for use by the Federal Grovem-
ment, by follow-on non-SBIR Federal funding awards; 
and 
"(ii) for which awards from non-SBIR Federal fund-
ing sources are used for the continuation of research 
or research and development that has been competi-
tively selected using peer review or scientific review 
criteria; and", 
(b) REQUIRED EXPENDITURES FOR SBIR BY FEDERAL AGEN-
CIES.—Section 9(f) of the Small Business Act (15 U.S.C. 638(f)) 
is amended to read as follows: 
"(f) FEDERAL AGENCY EXPENDITURES FOR THE SBIR PROGRAM.— 
"(1) 
REQUIRED 
EXPENDITURE 
AMOUNTS.—Each 
Federal 
agency which has an extramural budget for research or research 
and development in excess of $100,000,000 for fiscal year 1992, 
or any fiscal year thereafter, shall expend with small business 
concerns— 
"(A) not less than 1.5 percent of such budget in each 
of fiscal years 1993 and 1994; 
"(B) not less thgin 2.0 percent of such budget in each 
of fiscal years 1995 and 1996; and 
"(C) not less than 2.5 percent of such budget in each 
fiscal year thereafter, 
specifically in connection with SBIR programs which meet the 
requirements of this section, policy directives, and regulations 
issued under this section. 
"(2) LIMITATIONS.—A Federal agency shall not— 
"(A) use any of its SBIR budget established pursuant 
to paragraph (1) for the purpose of funding administrative 
costs of the program, including costs associated with sala-
ries and expenses; or 
"(B) make available for the purpose of meeting the 
requirements of paragraph (1) an amount of its extramural 
budget for basic research which exceeds the percentages 
specified in paragraph (1). 
"(3) EXCLUSION OF CERTAIN FUNDING AGREEMENTS.—Fund-
ing agreements with small business concerns for research or 
research Eind development which result from competitive or 
single source selections other than an SBIR program shall 
106 STAT. 4252 
PUBUC LAW 102-564—OCT. 28,1992 
not be considered to meet any portion of the percentage require-
ments of paragraph (1).". 
(c) INCLUSION OF CERTAIN DEPARTMENT OF DEFENSE RESEARCH 
A
N
D DEVELOPMENT ACTIVITIES.—Section 9(e) of the Small Business 
Act (15 U.S.C. 638(e)) is amended in paragraph (1), by striking 
Tor the Department of Defense" and all that follows through "devel-
opment" and inserting "for the Department of Energy it shall not 
include amounts obligated for atomic energy defense programs 
solely for weapons activities or for naval reactor programs". 
(d) SBIR SOLICITATIONS.—Section 9(g) of the Small Business 
Act (16 U.S.C. 638(g)) is amended— 
(1) by redesignating paragraphs (3) through (7) as para-
graphs (4) through (8), respectively; and 
(2) by inserting after paragraph (2) the following new para-
graph: 
"(3) unilaterally determine research topics within the agen-
cy's SBIR solicitations, giving special consideration to broad 
research topics and to topics that fiirther 1 or more critical 
technologies, as identified by— 
"(A) the National Critical Technologies Panel (or its 
successor) in the 1991 report required under section 603 
of the National Science and Technology Policy, Organiza-
tion, and Priorities Act of 1976, and in subsequent reports 
issued under that authority; or 
"(B) the Secretary of Defense, in the 1992 report issued 
in accordance with section 2522 of title 10, United States 
Code, and in subsequent reports issued under that author-
ity;". 
(e) DEADLINE FOR FINAL PAYMENT UNDER SBIR FUNDING 
AGREEMENTS.—Section 9(gX7) of the Small Business Act (15 U.S.C. 
638(gX7)) (as redesignated by subsection (dXl)) is amended by 
inserting before the semicolon the following: "and, in all cases, 
make payment to recipients under such agreements in full, subject 
to audit, on or before the last day of the 12-month period beginning 
on the date of completion of such requirements". 
(f) MODIFICATIONS TO SBIR POLICY DIRECTIVES.—Section 9(j) 
of the Small Business Act (15 U.S.C. 638(j)) is amended— 
(1) in paragraph (2), by redesignating subparagraphs (A) 
through (H) as clauses (i) through (viii), respectively; 
(2) by redesignating paragraphs (1) through (7) as sub-
paragraphs (A) through (G), respectively; 
(3) by inserting before "The Small Business Administration" 
the following: 
"(1) POLICY DIRECTIVES.—"; and 
(4) by adding at the end the following new paragraph: 
"(2) MODIFICATIONS.—^Not later than 90 days after the date 
of enactment of the Small Business Research and Development 
Enhancement Act of 1992, the Administrator shall modify the 
policy directives issued pursuant to this subsection to provide 
for— 
"(A) retention by a small business concern of the rights 
to data generated by the concern in the performance of 
an SBIR award for a period of not less than 4 years; 
"(B) continued use by a small business concern partici-
pating in the third phase of the SBIR program, as a 
directed bailment, of any property transferred by a Federal 
agency to the small business concern in the second phase 
PUBLIC LAW 102-564—OCT. 28, 1992 
106 STAT. 4253 
of an SBIR progiram for a period of not less than 2 years, 
beginning on the initial date of the concern's participation 
in the third phase of such program; 
"(C) procedures to ensure, to the extent practicable, 
that an agency which intends to pursue research, develop-
ment, or production of a technology developed by a small 
business concern under an SBIR program enters into fol-
low-on, non-SBIR funding agreements with the small busi-
ness concern for such research, development, or production; 
"(D) an increase to $100,000 in the amount of funds 
which an agency may award in the first phase of an SBIR 
program, and to $750,000 in the second phase of an SBIR 
program, and an adjustment of such amounts once every 
5 years to reflect economic adjustments and programmatic 
considerations; 
"(E) a process for notifying the participating SBIR 
agencies ana potential SBIR participants of the 1991, 1992, 
and the current critical technologies, as identified— 
"(i) by the National Critical Technologies Panel 
(or its successor), in accordance with section 603 of 
the National Science and Technology PoUcy, Organiza-
tion, and Priorities Act of 1976; or 
"(ii) by the Secretary of Defense, in accordance 
with section 2522 of title 10, United States Code; 
"(F) enhanced outreach efforts to increase the participa-
tion of socially and economically disadvantaged small busi-
ness concerns, as defined in section 8(a)(4), and the partici-
pation of small businesses that are 51 percent owned and 
controlled by women in technological innovation and in 
SBIR programs, including the tlurd phase of such pro-
grams, and the collection of data to document such partici-
pation; 
"(G) technical and programmatic guidance to encourage 
agencies to develop gap-funding programs to address the 
delay between an award for the first phase of an SBIR 
program and the application for and extension of an award 
lor the second phase of such program; 
"(H) procedures to ensure that a small business concern 
that submits a proposal for a funding agreement for the 
first phase of an SBIR program and that has received 
more than 15 second phase SBIR awards during the preced-
ing 5 fiscal years is able to demonstrate the extent to 
which it was able to secure third phase funding to develop 
concepts resulting from previous second phase SBIR 
awards; and 
"(I) procedures to ensure that agencies participating 
in the SBIR program retain the information submitted 
under subparagraph (H) at least until the Greneral Account-
ing Office submits the report required under section 105 
of the Small Business Research and Development Enhance-
ment Act of 1992.". 
(g) 
ELIMINATION 
OF SURVEYING AND REPORTING 
REQUIRE-
MENT.—Section 9(k) of the Small Business Act (15 U.S.C. 638(k)) 
is amended to read as follows: 
"(k) [Reserved].". 
(h) REPORTING OF AWARDS MADE FROM SINGLE PROPOSAL, TO 
MULTIPLE AWARD WINNERS, OR TO CRITICAL TECHNOLOGY TOPICS.— 
106 STAT. 4254 
PUBLIC LAW 102-564—OCT. 28,1992 
(1) IN GENERAL.—Section 9 of the Small Business Act (15 
U.S.C. 638) is amended by adding at the end the following 
new subsection: 
"(0 REPORTING OF AWARDS MADE FROM SINGLE PROPOSAL, TO 
MULTIPLE AWARD WINNERS, OR TO CRITICAL TECHNOLOGY TOPICS.— 
"(1) SINGLE PROPOSAL.—If a Federal agency required to 
establish an SBIR program under subsection (f) makes an 
award with respect to an SBIR solicitation topic or subtopic 
for which the agency received only 1 proposal, the agency 
shall provide written justification for making the award in 
its next quarterly report to the Administration and in the 
agenc/s next annual report required under subsection (gX8). 
"(2) MULTIPLE AWARDS.—An agency referred to in para-
graph (1) shall include in its next annual report required under 
subsection (g)(8) an accounting of the awards the agency has 
made for the first phase of an SBIR program during the report-
ing period to entities that have received more than 15 awards 
for the second phase of an SBIR program during the preceding 
5 fiscal years. 
"(3) CRITICAL TECHNOLOGY AWARDS.—An agency referred 
to in paragraph (1) shall include in its next annual report 
required under subsection (g)(8), an accoimting of the number 
of awards it has made to critical technology topics, as defined 
in subsection (g)(3), including an identification of the specific 
critical technologies topics, and the percentage by number and 
dollar amount of the agenc3r's total SBIR awards to such critical 
technology topics.". 
(2) CONFORMING AMENDMENT.—Section 9(g)(5) of the Small 
Business Act (15 U.S.C. 638(g)(5)) (as redesignated by sub-
section (d)) is amended by inserting "subject to subsection (/)," 
before **unilaterall3r". 
(i) INFORMATION ON ALLOWABLE EXPENSES.—Section 9(g)(5) of 
the Small Business Act (as redesignated by subsection (d)) is amend-
ed by inserting before the semicolon the following: "and inform 
each awardee under such an agreement, to the extent possible, 
of the expenses of the awardee that will be allowable imder the 
funding agreement". 
SEC. 104. EXTENSION OF SBIR PROGRAM. 
(a) REPEAL PROVISION.—Section 5 of the Small Business Innova-
15 u s e 638 
tion Development Act of 1982 is hereby repealed. 
^<* "*»*«• 
(b) TERMINATION DATE.—Section 9 of the Small Business Act 
(15 U.S.C. 638) is amended by adding at the end the following: 
"(m) TERMINATION.—^The authorization to carry out the Smsul 
Business Innovation Research Program under tMs section shall 
terminate on October 1, 2000.". 
15 use 638 
SEC. 105. REPORTS OF THE COMPTROLLER GENERAL. 
"*'*®" 
(a) INTERIM REPORT.— 
(1) IN GENERAL.—The Comptroller General of the United 
States shall submit to the Congress an interim report concern-
ing the quality of research performed under SBIR program 
funding agreements entered into during fiscal year 1993 and 
thereaireer. Copies of the interim report shall be fiimished to 
each agency that has participated in the SBIR program in 
fiscal year 1993 or thereafter. 
(2) CONTENTS OF REPORT.—The Comptroller Greneral shall 
include in the interim report required under paragraph (1)— 
PUBLIC LAW 102-564—OCT. 28, 1992 
106 STAT. 4255 
(A) an assessment of the quality of the research per-
formed under the SBIR program funding agreements 
entered into by each agency that has participated in the 
SBIR program beginning in fiscal year 1993 or thereafter, 
specifically addressing— 
(i) with respect to each such agency, whether or 
not there has been a demonstrable reduction in 
research quaUty; and 
(ii) in the case of such reduction, whether an 
increase in each such agency's required SBIR participa-
tion in accordance with section 9(f)(1) of the Small 
Business Act (as amended by subsection (b) of this 
section) would adversely affect the performance of the 
agencjr's research programs; 
(B) an analysis of the program authorized by section 
301 of the Small Business Research and Development 
Enhancement Act of 1992, considering, among other 
things— 
(i) the extent to which each SBIR agency has 
implemented the program and the extent to which 
the program has improved the quality of agency-spon-
sored rese£irch and development; 
(ii) the effect of the program on recipient compa-
nies' ability to develop and commercialize technology; 
(iii) the cost of the program and the average cost 
per recipient company; and 
(iv) the extent to which SBIR companies continue 
to use the service after completion of the program; 
and 
(C) such other factors as the Comptroller General may 
deem appropriate. 
(b) FINAL REPORT.—The Comptroller General of the United 
States shall treinsmit to the Congress a final report containing— 
(1) a review of the progress made by Federal agencies 
in meeting the requirements of section 9(f) of the Small Busi-
ness Act (as amended by this Act), including increases in 
expenditures required by that subsection; 
(2) an analysis of participation by small business concerns 
in the third phase of SBIR programs, including a systematic 
evaluation o
f
^ the techniques adopted by Federal agencies to 
foster commercialization; 
(3) an analysis of the extent to which awards under SBIR 
programs are made pursuant to section 9(1) of the Small Busi-
ness Act (as added by section 103(h)) in cases in which a 
program solicitation receives only 1 proposal; 
(4) an analysis of the extent to which awards in the first 
phase of the SBIR program are made to small business concerns 
that have received more than 15 second phase awards under 
the SBIR program in the preceding 5 fiscal years, considering— 
(A) the extent to which such concerns were able to 
secure Federal or private sector follow-on funding; 
(B) the extent to which the research developed under 
such awards was commercialized; and 
(C) the amoimt of commerciaUzation of research devel-
oped under such awards, as compared to the amount of 
commercialization of SBIR research for the entire SBIR 
program; 
106 STAT. 4256 
PUBLIC LAW 102-564—OCT. 28, 1992 
(5) the results of periodic random audits of the extramural 
budget of each such Federal agency; 
(6) a review of the extent to which the purposes of this 
title and the Small Business Innovation Development Act of 
1982 have been met with regard to fostering and encouraging 
the participation of women-owned small business concerns and 
socially and economically disadvantaged small business con-
cerns (as defined in the Small Business Act) in technological 
innovation, in general, and the SBIR program, in particular; 
(7) an analysis of the effectiveness of the SBIR program 
in promoting the development of the critical technologies identi-
fied by the Secretary of Defense and the National Critical 
Technologies Panel (or its successor), as described in subpeira-
graph 9(j)(2)(E) of the Small Business Act; 
(8) an analysis of the impact of agency application review 
periods and funding cycles on SBIR program awardees' financial 
status and ability to commercialize; ana 
(9) recommendations to the Congress for tracking the 
extent to which foreign firms, or United States firms with 
substantial foreign ownership interests, benefit from technology 
or products developed as a direct result of SBIR research or 
research £uid development. 
(c) DATES OF SUBMISSION.—The report required— 
(1) under subsection (a), shall be submitted to the Congress 
not later than March 31,1995; and 
(2) under subsection (b), shall be submitted to the Congress 
not later than 5 years after the date of enactment of this 
title. 
15 use 638 
SEC. 106. RECOMMENDATIONS OF THE SECRETARY OF DEFENSE. 
"°*® 
Not later than March 31, 1996, the Secretary of Defense shall 
submit a recommendation to the Congress addressing whether there 
has been a demonstrable reduction in the quality of research per-
formed under the SBIR program since the beginning of fiscal year 
1993, such that increasing the percentage under section 9(f)(1)(C) 
of the Small Business Act (as amended by section 103 of this 
Act) would adversely affect the performance of the research pro-
gr£uns of the Department of Defense. 
S S ^ " ^ 
TITLE 
II—SMALL 
BUSINESS 
TECH-
A^%2 
NOLOGY TRANSFER PILOT PROGRAM 
15 use 631 
SEC. 201. SHORT TITLE. 
"°*®" 
This title may be cited as the "Small Business Technology 
Transfer Act of 1992". 
SEC. 202. ESTABUSHMENT OF SMALL BUSINESS TECHNOLOGY TRANS-
FER PILOT PROGRAM. 
(a) ADDITIONAL S B A DUTIES.—Section 9(b) of the Small Busi-
ness Act (15 U.S.C. 638(b)) is amended— 
(1) in paragraph (4), by inserting "and small business tech-
nology transfer pilot programs" after "small business innovation 
research programs"; and 
(2) in paragraphs (5), (6), and (7), by inserting "and STTR" 
after "SBIR" each place such term appears. 
PUBLIC LAW 102-564—OCT. 28, 1992 
106 STAT. 4257 
(b) SMALL BUSINESS TECHNOLOGY TRANSFER PILOT PROGRAM 
DEFINED.—Section 9(e) of the Small Business Act (15 U.S.C. 638(e)) 
is amended— 
(1) in paragraph (4), by striking "and" at the end; 
(2) in paragraph (5), by striking the period at the end 
and inserting a semicolon; and 
(3) by adding at the end the following new paragraphs: 
"(6) the term 'Small Business Technology Transfer Pro-
gram' or *STTR' means a pilot program under which a portion 
of a Federal agency's extramural research or research and 
development effort is reserved for award to small business 
concerns for cooperative research and development through 
a uniform process having— 
"(A) a first phase, to determine, to the extent possible, 
the scientific, technical, and commercial merit and fea-
sibility of ideas submitted pursuant to STTR program solici-
tations; 
"(B) a second phase, to further develop proposed ideas 
to meet particular program needs, in which awards shall 
be made based on the scientific, technical, and commercial 
merit and feasibihty of the idea, as evidenced by the first 
phase and by other relevant information; and 
"(C) where appropriate, a third phase— 
"(i) in wnich commercial applications of STTR-
funded research or research and development are 
funded by non-Federal sources of capital or, for prod-
ucts or services intended for use by the Federal Govern-
ment, by follow-on non-STTR Feaeral funding awards; 
and 
"(ii) for which awards from non-STTR Federal 
funding sources are used for the continuation of 
research or research and development that has been 
competitively selected using peer review or scientific 
review criteria; 
"(7) the term 'cooperative research and development' means 
research or research and development conducted jointly by 
a small business concern and a research institution in which 
not less than 40 percent of the work is performed by the 
small business concern, and not less than 30 percent of the 
work is performed by the research institution; and 
"(8) the term 'research institution' means a nonprofit 
institution, as defined in section 4(5) of the Stevenson-Wydler 
Technology Innovation Act of 1980, and includes federally 
funded research and development centers, as identified by the 
National Scientific Foundation in accordance with the gov-
emmentwide Federal Acquisition Regulation issued in accord-
ance with section 35(c)(1) of the Office of Federal Procurement 
PoHcy Act (or any successor regulation thereto).". 
(c) ESTABLISHMENT OF SMALL BUSINESS TECHNOLOGY TRANSFER 
PROGRAMS BY CERTAIN FEDERAL AGENCIES.—Section 9 of the Small 
Business Act (15 U.S.C. 638) is amended by adding at the end 
the following new subsections: 
"(n) REQUIRED EXPENDITURES FOR STTR BY FEDERAL AGEN-
C I E S . -
"(1) 
REQUIRED 
EXPENDITURE AMOUNTS.—Each Federal 
agency which has an extramural budget for research or research 
and development in excess of $1,000,000,000 in fiscal year 
Decorations, 
medals, 
awards. 
Contracts. 
106 STAT. 4258 
PUBLIC LAW 102-564—OCT. 28, 1992 
1994, 1995, or 1996, is authorized to expend with small business 
concerns— 
"(A) not less thein 0.05 percent of such budget in fiscal 
year 1994; 
"(B) not less than 0.1 percent of such budget in fiscal 
year 1995; and 
"(C) not less than 0.15 percent of such budget in fiscal 
year 1996, 
specifically in connection with STTR programs which meet 
the requirements of this section, policy directives, and regula-
tions issued under this section. 
"(2) LIMITATIONS.—A Federal agency shall not— 
"(A) use any of its STTR budget established pursuant 
to paragraph (1) for the purpose of funding administrative 
costs of the program, including costs associated with sala-
ries and expenses, or, in the case of a small business 
concern or a research institution, costs associated with 
salaries, expenses, and administrative overhead (other than 
those direct or indirect costs allowable under guidelines 
of the Office of Management and Budget and the gov-
emmentwide Federal Acquisition Regulation issued in 
accordance with section 25(c)(1) of the Office of Federal 
Procurement Policy Act); or 
"(B) make available for the purpose of meeting the 
requirements of paragraph (1) an amount of its extramural 
budget for basic research which exceeds the percentage 
specified in paragraph (1). 
"(3) EXCLUSION OF CERTAIN FUNDING AGREEMENTS.—Fund-
ing agreements with small business concerns for research or 
research and development which result from competitive or 
single source selections other thEui an STTR program shall 
not be considered to meet any portion of the percentage require-
ments of paragraph (1). 
"(o) FEDERAL AGENCY STTR AUTHORITY.—Each Federal agency 
required to establish an STTR program in accordance with sub-
section (n) and regulations issued under this Act, shall— 
"(1) unilaterally determine categories of projects to be 
included in its STTR program; 
"(2) issue STTR solicitations in accordance with a schedule 
determined cooperatively with the Administration; 
"(3) unilaterally determine research topics within the agen-
cy's STTR solicitations, giving special consideration to broad 
research topics and to topics that further 1 or more critical 
technologies, as identified— 
"(A) by the National Critical Technologies Panel (or 
its successor) in reports required under section 603 of the 
National Science and Technology Policy, Organization, and 
Priorities Act of 1976; or 
"(B) by the Secretary of Defense, in accordance with 
section 2522 of title 10, United States Code; 
"(4) unilaterally receive and evaluate propossJs resulting 
from STTR solicitations; 
"(5) unilaterally select awardees for its STTR funding 
agreements and inform each awardee under such an agreement, 
to the extent possible, of the expenses of the awardee that 
will be allowable under the funding agreement; 
PUBLIC LAW 102-564—OCT. 28, 1992 
106 STAT. 4259 
"(6) administer its own STTR funding agreements (or dele-
gate such administration to another agency); 
"(7) make payinents to recipients of STTR funding agree-
ments on the Ibasis of progress toward or completion of the 
funding agreement requirements and, in all cases, make pay-
ment to recipients under such agreements in full, subject to 
audit, on or before the last day of the 12-month period beginning 
on the date of the completion of such requirements; 
"(8) submit an annual report on the STTR program to Reports, 
the Administration and the Office of Science and Technology 
Policy; 
"(9) develop a model agreement not later than July 31, 
1993, to be approved by the Administration, for allocating 
between small business concerns and research institutions 
intellectual property rights and rights, if any, to carry out 
follow-on research, development, or commercigdization; 
"(10) develop, in consultation with the Office of Federal 
Procurement Policy and the Office of Government Ethics, proce-
dures to ensure that federally funded research and development 
centers (as defined in subsection (e)(8)) that participate in 
STTR agreements— 
"(A) are free from organizational conflicts of interests 
relative to the STTR program; 
"(B) do not use privileged information gained through 
work performed for an STTR agency or private access to 
STTR agency personnel in the development of an STTR 
proposal; and 
"(C) use outside peer review, as appropriate; and 
"(11) not later than July 31, 1993, develop procedures 
for assessing the commercial merit and feasibility of STTR 
proposals, as evidenced by— 
"(A) the small business concern's record of successfully 
commercializing STTR or other research; 
"(B) the existence of second phase funding commit-
ments from private sector or non-STTR funding sources; 
"(C) the existence of third phase follow-on commit-
ments for the subject of the research; and 
"(D) the presence of other indicators of the commercial 
potential of the idea, 
"(p) STTR POLICY DIRECTIVE.— 
"(1) ISSUANCE.—The Administrator shall issue a policy 
directive for the general conduct of the STTR programs within 
the Federal Government. Such policy directive shall be issued 
after consultation with— 
"(A) the heads of each of the Federal agencies required 
by subsection (n) to establish an STTR program; 
"(B) the Commissioner of Patents and Trademarks; 
and 
"(C) the Director of the Office of Federal Procurement 
Policy. 
"(2) CONTENTS.—The policy directive required by paragraph 
(1) shall provide for— 
"(A) simplified, standardized, £uid timely STTR solicita-
tions; 
"(B) a simplified, standardized funding process that 
provides f o r -
"(i) the timely receipt and review of proposals; 
106 STAT. 4260 
PUBUC LAW 102-564—OCT. 28,1992 
"(ii) outside peer review, if appropriate; 
"(iii) protection of proprietaiy information provided 
in proposals; 
"(iv) selection of awardees; 
"(v) retention by a small business concern of the 
rights to data generated by the concern in the perform-
ance of an SITR award for a period of not less than 
4 years; 
"(vi) continued use by a small business concern, 
as a directed bailment, of any property transferred 
by a Federal agency to the small business concern 
in the second phase of the STTR program for a period 
of not less than 2 years, beginning on the initial date 
of the concern's participation in the third phase of 
such program; 
"(vii) cost sharing; 
"(viii) cost principles and pajnnent schedules; and 
"(ix) 1-year awards for the first phase of an STTR 
program, generally not to exceed $100,000, and 2-year 
awards for the second phase of an STTR program, 
generally not to exceed $500,000, greater or lesser 
amounts to be awarded at the discretion of the award-
ing agency; 
"(C) minimizing regulatory burdens associated with 
participation in STrk programs; 
"(D) guidelines for a model agreement, to be used by 
all agencies, for allocating between small business concerns 
and research institutions intellectual property rights and 
rights, if any, to carry out follow-on researdi, development, 
or commercialization; 
**(E) procedures to ensure that—-
**(i) a recipient of an STTR award is a small busi-
ness concern, as defined in section 3 and the regula-
tions promulgated thereimder; and 
"(ii) such small business concern exercises manage-
ment and control of the performance of the STTR fimd-
ing agreement pursuant to a business plan providing 
for the commercialization of the technology that is 
the subject matter of the award; and 
"(F) procediu'es to ensure, to the extent practicable, 
that an agency which intends to pursue research, develop-
ment, or production of a technology developed by a small 
business concern under an STTR program enters into fol-
low-on, non-STTR fiinding agreements with the small busi-
ness concern for such research, development, or produc-
tion.". 
Printing. 
(d) TIMING OF ISSUANCE OF POLICY DIRECTIVE.—The policy 
not^^ ^^ 
directive required by section 9(p) of the Small Business Act (as 
added by subsection (c) of this section) shall be published— 
(1) in proposed form (with an opportunity for public com-
ment of not less than 30 days), not later than April 30, 1993; 
and 
(2) in final form, not later than July 31,1993. 
15 use 638 
(e) REPORT OF THE COMPTROLLER GENERAL.—^Not later than 
note. 
March 31, 1996, the Comptroller General of the United States 
shall submit a report to the Congress and the head of each agen^r 
PUBLIC LAW 102-564—OCT. 28, 1992 
106 STAT. 4261 
that is required to make expenditures under the STTR program 
that— 
(1) sets forth the Comptroller General's assessment, with . 
respect to each such agency, o
f
— 
(A) the quality of research performed under funding 
agreements awarded by that agency under the STTR pro-
gram since the beginning of the program; 
(B) whether or not the STTR program has afTected 
the performance of that agencj^s research programs; and 
(C) the commercial potential of research conducted 
under the STTR program, if sufficient data is available; 
(2) contains the Comptroller General's assessment as to 
the effects of the STTR program, if any, on the research quality 
and goals of the SBIR program; and 
(3) determines the agencies and the federally-funded 
research and development centers' compliance with the proce-
dures developed under section 9(g)(10) of the Small Business 
Act, as amended by this section. 
TITLE III—MISCELLANEOUS 
PROVISIONS 
SEC. 
301. 
DISCRETIONARY 
TECHNICAL 
ASSISTANCE 
TO 
SBIR 
AWARDEES. 
(a) IN GENERAL.—Section 9 of the Small Business Act (15 
U.S.C. 638) is amended by adding at the end the following new 
subsection: 
"(q) DISCRETIONARY TECHNICAL ASSISTANCE.— 
"(1) IN GENERAL.—^Each Federal agency required by this 
section to conduct an SBIR program may enter into an agree-
ment with a vendor selected under paragraph (2) to provide 
small business concerns engaged in SBIR projects with tech-
nical assistance services, such as access to a network of sci-
entists and engineers engaged in a wide range of technologies, 
or access to technical and business literature available through 
on-line data bases, for the purpose of assisting such concerns 
in— 
"(A) making better technical decisions concerning such 
projects; 
"(B) solving technical problems which arise during the 
conduct of such projects; 
''(C) minimissing technical risks associatedfwith such 
projects; and 
"(D) developing and commercializing new commercial 
products and processes resulting from sudi projects. 
(2) VENDOR SELECTION.—^Annually, each agency may select 
a vendor for purposes of this subsection using competitive, 
merit-based criteria, to assist small business concerns to meet 
the goals listed in paragraph (1). 
"(3) ADDITIONAL TECHNICAL ASSISTANCE.— 
*
*
(
A
) FIRST PHASE.—^Each agency referred to in para-
graph (1) may provide services described in paragraph 
(1) to first phase SBIR award recipients in an amount 
equal to not more than $4,000, which sha^I be in addition 
to the amount of the recipient's award. 
106 STAT. 4262 
PUBLIC LAW 102-564—OCT. 28, 1992 
"(B) SECOND PHASE.—^Each agency referred to in para-
graph (1) may authorize any second phase SBIR award 
recipient to purchase, with funds available from their SBIR 
awards, services described in paragraph (1), in an amount 
equal to not more than $4,000 per year. 
SEC. 302. EXTENSION 
OF THE TECHNOLOGY 
TRANSFER 
DEM-
ONSTRATION PROGRAM. 
Section 231 of the Small Business Administration Reauthoriza-
tion and Amendments Act of 1990 (15 U.S.C. 648 note) is amended— 
(1) in subsection (g), by striking "1993" and inserting 
"1995"; and 
(2) in subsection (i), by striking "1991, 1992, and" and 
inserting "1994 and 1995". 
SEC. 303. REPORTING REQUIREMENTS. 
(a) REPORT ON DEFICIENT SUBCONTRACTING PLANS.—Section 
8(d) of the Small Business Act (15 U.S.C. 637(d)) is amended— 
(1) by striking paragraph (11); and 
(2) by redesignating paragraph (12) as paragraph (11). 
(b) SMALL PURCHASES FROM FEDERAL PRISON INDUSTRIES.— 
Section 4124(c) of title 18, United States Code, is amended in 
the first sentence by striking "to the General Services Administra-
tion" and all that follows through "Procurement Policy Act" and 
inserting "acquisitions of products and services from Federal Prison 
Industries to the Federal Procurement Data System (as referred 
to in section 6(d)(4) of the Office of Federal Procurement PoHcy 
Act) in the same manner as it reports other acquisitions". 
SEC. 304. SMALL BUSINESS INSTITUTES. 
Section 8(b)(1) of the Small Business Act (15 U.S.C. 637(b)(1)) 
is amended— 
(1) by redesignating subparagraphs (E) and (F) as sub-
paragraphs (F) and (G), respectively; £ind 
(2) by inserting after subparagraph (D) the following: 
"(E) In carrying out its lunctions under subparagraph (A), 
to make grants (including contracts and cooperative agree-
ments) to any public or private institution of higher education 
for the establishment and operation of a small business 
institute, which shall be used to provide business counseUng 
and assistance to small business concerns through the activities 
of students enrolled at the institution, which students shall 
be entitled to receive educational credits for their activities.". 
SEC. 305. ADDITIONAL SBIR AND STTR PROVISIONS. 
Section 9 of the Small Business Act (15 U.S.C. 638), is amended 
by adding at the end the following new subsection: 
"(r) THIRD PHASE AGREEMENTS.— 
"(1) IN GENERAL.—^In the case of a small business concern 
that is awEirded a funding agreement for the second phase 
of an SBIR or STTR program, a Federal agency may enter 
into a third phase agreement with that business concern for 
additional work to be performed during or after the second 
phase period. The second phase fruiding agreement with the 
small business concern may, at the discretion of the agency 
awarding the agreement, set out the procedures applicable 
to third phase agreements with that agency or any other 
agency. 
PUBLIC LAW 102-564—OCT. 28, 1992 
106 STAT. 4263 
"(2) DEFINITION.—In this subsection, the term 'third phase 
agreement' means a follow-on, non-SBIR or non-STTR funded 
contract as described in paragraph (4)(C) or paragraph (6XC) 
of subsection (e). 
"(3) INTELLECTUAL PROPERTY RIGHTS.—Each fimding agree-
ment iinder an SBIR or STTR program shall include provisions 
setting forth the respective rights of the United States and 
the small business concern with respect to intellectual property 
rights and with respect to any right to carry out follow-on 
research.". 
SEC. 306. SENSE OF THE CONGRESS CONCERNING AMERICAN-MADE 
EQUIPMENT AND PRODUCTS. 
(a) PURCHASE OF AMERICAN-MADE EQUIPMENT AND PROD-
UCTS.—It is the sense of the Congress that an entity that is awarded 
a funding agreement under the SBIR program of a Federal agency 
under section 9 of the Small Business Act should, when purchasing 
any equipment or a product with funds provided through the fund-
ing agreement, purchase only American-made equipment and prod-
ucts, to the extent possible in keeping with the overall purposes 
of that program. 
(b) NOTICE TO SBIR AWARDEES.—Each Federal agency that 
awards funding agreements under the SBIR program shall provide 
to each recipient of such an award a notice describing the sense 
of the Congress, as set forth in subsection (a). 
SEC. 307. TECHNICAL CORRECTIONS. 
(a) SMALL BUSINESS PARTICIPATION RATES.—Section 714(b)(4) 
of the Small Business Competitiveness Demonstration Program Act 
of 1988 (15 U.S.C. 644 note, 102 Stat. 3892) is amended by inserting 
"or other services in support of such contracts" after "(including 
surveying and mapping)". 
(b) MiCROLOAN PROGRAM FUNDING.—Section 7(m)(7) of the 
Small Business Act (15 U.S.C. 636(m)(7)) is amended— 
(1) in subparagraph (A), by adding at the end the following: 
"If, at the end of fiscal year 1992, the Administration has 
funded less than 50 microloan programs under this subpara-
graph, the Administration may, in fiscal year 1993, fund a 
number of additional microloan programs equal to the difference 
between 50 and the niunber of microloan programs actually 
funded in fiscal year 1992."; and 
(2) in subparagraph (B), by striking "In the second" and 
inserting "In addition to any microloan programs authorized 
to be funded in fiscal year 1993 in accordance with subpara-
graph (A), in the second". 
15 u s e 638 
note. 
Decorations, 
medals, 
awards. 
Contracts. 
106 STAT. 4264 
PUBLIC LAW 102-564—OCT. 28, 1992 
(c) DEFINITION OF INTERMEDIARY.—Section 7(mXll)(A)(ii) of the 
Small Business Act (15 U.S.C. 636(mXll)(AXii)) is amended by 
inserting "private," before "nonprofit". 
(d) SECONDARY LOAN MARKETS.—Section 5(f)(4) of the Small 
Business Act (15 U.S.C. 634(fX4)) is amended by striking "5(e), 
7(aX6), or 7(aX8)" and inserting "7(aX6XC) or subsection (e) of 
this section". 
Approved October 28, 1992. 
LEGISLATIVE 
fflSTORY—S. 
2941: 
CONGRESSIONAL RECORD, Vol. 138 (1992): 
Oct. 3, considered and passed Senate. 
Oct. 5, considered and passed House. 
WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS, Vol. 28 (1992): 
Oct. 28, Presidential statement.