President Joe Biden signed the SBIR and STTR Extension Act of 2022, reauthorizing SBIR/STTR until September 30, 2025.
Part 5: Tragedy Averted: The SBIR/STTR Extension Act of 2022
In this series, Jace Gatzemeyer discusses the history, legacy, goals, successes, and shortcomings of the SBIR and STTR programs. This fifth installment looks at the legislative history of SBIR and its most recent reauthorization.
In late September 2022, I received a monthly newsletter from a business consultancy that assists with SBIR/STTR grant writing. The headline read, “We can all now breathe a collective sigh of relief.” Yes, though you may not have noticed, people in the SBIR-o-sphere were holding their collective breath.
On September 30, 2022, the very day the programs were scheduled to expire, President Biden signed the SBIR and STTR Extension Act of 2022, reauthorizing SBIR/STTR until September 30, 2025. While this one may have come late enough to induce some serious breath-holding, reauthorization and extension is nothing new to the SBIR program. Founded in 1982, SBIR was reauthorized in 1992, when Congress passed the Small Business Research and Development Enhancement Act (P.L. 102-564), in 2000, when the program was reauthorized by the Small Business Reauthorization Act of 2000 (P.L. 106-554), and in 2011 through the National Defense Authorization Act for Fiscal Year 2012 (P.L. 112-81). For a closer look at the bills from 1992 and 2000 and the ongoing debates surrounding the program, you can check out Part 2 and Part 3 of this blog series.
As summer turned to fall, with the end-of-September-2022 deadline quickly approaching, most folks in SBIR/STTR-related work didn’t seem too concerned about the future of the programs. This is just what happens: the deadline approaches and the programs get extended. After all, SBIR and STTR are regarded positively on either side of the political aisle — despite the recent gasps of indignation from Senator Rand Paul, who was worried, as ever, about “bad actors lining their pockets with taxpayer dollars.” But as the sunset provision loomed, some folks started to get a little worried.
In particular, those connected to the Department of Defense, which accounts for approximately 50 percent of all SBIR/STTR funds, worried that a relied-upon small business funding mechanism might be removed with disastrous consequences. In a June 3 letter to lawmakers Undersecretary of Defense for Acquisition and Sustainment William LaPlante and Undersecretary for Research and Engineering Heidi Shyu warned that “any lapse [in SBIR/STTR] could result in thousands of small businesses being forced to lay off workers, or drive them to other sources of funding, to include foreign investment.”
But with mere weeks before expiration, insiders still looked askance at the SBIR/STTR reauthorization process. Initial efforts at reauthorization had already failed, and the pathway forward was beginning to look uncertain. An attempt was made to include a five-year extension to SBIR/STTR on the House’s Creating Opportunities for Manufacturing, Pre-Eminence in Technology and Economic Strength (COMPETES) Act, but the extension was dropped in the Senate. The House Armed Services Committee added it as an amendment to the 2023 National Defense Authorization Act (NDAA), but with Congress unlikely to pass the final act by October, this would have meant a lapse in the programs. Surprisingly, there was even discussion of a free-standing bill, a process requiring a higher standard — unanimous consent by 100 senators — than other options.
Would reauthorization be included in a “stopgap continuing resolution” that would be needed to keep the government funded through December 16? Would it be tacked onto the new defense policy bill, like it was in 2011? If the latter, would the programs lapse for the first time in 40 years?
In the end, what appeared to be the least likely route became the programs’ salvation. Senators Benjamin L. Cardin (D-MD) and Joni Ernst (R-IA) introduced the SBIR and STTR Extension Act of 2022 to the Senate on September 20, and it was passed by unanimous consent that same day. Next, it passed the House by a vote of 415-9 and was sent to the office of the President to be signed.
How did the bill achieve unanimous support in the Senate? In this day of highly charged partisan politics, how on earth were the righteous worries of The Honorable Rand Paul et. al. assuaged? Well, simply put, the bill made some significant changes to the SBIR/STTR programs. Among other things, the bill added new due diligence and reporting requirements, award restrictions, “clawback provisions” related to national security risks, and increased minimum performance standards for multiple SBIR/STTR winners.
That’s more modification than these programs have seen in quite some time. What will the effects of these changes be, you ask? For that, dear reader, you must join us in the next installment in the grand saga of SBIR/STTR. Until then, breathe easy — the programs are safe. For now.
Check out the next installment of Big Government, Small Business: A Guide to the SBIR and STTR Programs. Coming soon!
This blog first appeared on the UNeTech blog. Read more at http://www.unetech.org/blog/.