[Federal Register Volume 77, Number 151 (Monday, August 6, 2012)]
[Rules and Regulations]
[Pages 46855-46908]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-18120]


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SMALL BUSINESS ADMINISTRATION

13 CFR Chapter I

RIN 3245-AF45


Small Business Technology Transfer Program Policy Directive

AGENCY: Small Business Administration.

ACTION: Final policy directive with request for comments.

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SUMMARY: The U.S. Small Business Administration (SBA) is amending its 
Small Business Technology Transfer (STTR) Policy Directive. The purpose 
of these amendments is to implement those provisions of the National 
Defense Authorization Act for Fiscal Year 2012 affecting the program.

DATES: You must submit your comments on or before October 5, 2012.

[[Page 46856]]


ADDRESSES: You may submit comments, identified by RIN: 3245-AF45, by 
any of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     Mail, Hand Delivery/Courier: Edsel Brown, Assistant 
Director, Office of Technology, U.S. Small Business Administration, 409 
Third Street SW., Washington, DC 20416.
    SBA will post all comments to this policy directive on 
www.regulations.gov. If you wish to submit confidential business 
information (CBI) as defined in the User Notice at www.regulations.gov, 
you must submit such information to Edsel Brown, or send an email to 
[email protected]. Highlight the information that you consider to be 
CBI and explain why you believe SBA should hold this information as 
confidential. SBA will review your information and determine whether it 
will make the information public.

FOR FURTHER INFORMATION CONTACT: Edsel Brown, Assistant Director, 
Office of Technology, at (202) 401-6365.

SUPPLEMENTARY INFORMATION:

I. Executive Summary

    The Small Business Act (Act) requires that the U.S. Small Business 
Administration (SBA) issue a policy directive setting forth guidance to 
the Federal agencies participating in the STTR program. The STTR Policy 
Directive outlines how agencies must generally conduct their STTR 
programs. Each agency, however, can tailor their STTR Program to meet 
the needs of the individual agency, as long as the general principles 
of the program set forth in the Act and directive are followed.
    With this notice, SBA is issuing an amended policy directive, which 
implements the recent changes made to the STTR Program as part of the 
SBIR/STTR Reauthorization Act of 2011 (Reauthorization Act). In fact, 
the Reauthorization Act requires that SBA issue amendments to the STTR 
Policy Directive and publish the amendments in the Federal Register by 
the end of June 2012.
    Although the STTR Policy Directive is intended for use by the STTR 
participating agencies, SBA believes that public input on the directive 
from all parties involved in the program would be invaluable. 
Therefore, SBA is soliciting public comments on this final directive, 
and may amend the directive in response to these comments at a later 
time.
    The Reauthorization Act made several key changes to the STTR 
Program relating to eligibility, the STTR award process, STTR Program 
administration, and fraud, waste and abuse and SBA has addressed these 
issues in the directive. Although SBA has explained in detail the 
changes in the preamble, SBA believes it would be beneficial to all if 
it set forth an abbreviated outline of some of the key provisions and 
amendments to the Policy Directive in an Executive Summary.

A. Eligibility

    With respect to eligibility for an STTR award, the directive:
     Addresses the new requirements permitting small business 
concerns that are majority-owned by multiple venture capital operating 
companies (VCOCs), hedge funds or private equity firms to participate 
in the program;
     Permits an SBIR Phase I awardee to receive an STTR Phase 
II award; and
     States that a small business may receive two, sequential 
Phase II awards.
    For example, SBA amended the directive to address the two new 
statutory exceptions to the general rule that only STTR Phase I 
awardees may receive an STTR Phase II award. According to the 
Reauthorization Act, a Federal agency may now issue an STTR Phase II 
award to an SBIR Phase I awardee in order to further develop the work 
performed under the SBIR Phase I award.

B. STTR Award Process

    With respect to the STTR award process, the Policy Directive 
incorporates the new statutory requirements, including the following:
     Increasing the minimum percentage of an agency's 
extramural R/R&D budget that must be awarded to small businesses under 
the program;
     Establishing agency measures to evaluate an STTR Phase I 
applicant's success with prior Phase I and Phase II awards;
     Ensuring agencies make award decisions within the 
statutorily required time frames; and
     Increasing the dollar thresholds for Phase I and Phase II 
awards.
    For example, SBA has amended the Policy Directive to clarify that 
the STTR Program is extended until September 30, 2017 and to address 
the increase in the minimum percentages of an agency's extramural 
budget for R/R&D that must be awarded to SBCs under the STTR program. 
As required by statute, the minimum percentages increase by 0.05% every 
two fiscal years through fiscal year 2017.
    Further, SBA amended the directive to set forth the criteria by 
which agencies must establish standards, or benchmarks, to measure the 
success of certain Phase I awardees in receiving Phase II awards and to 
measure the success of certain Phase I awardees in receiving Phase III 
awards. The purpose of these standards, or benchmarks, is to ensure 
that repeat Phase I awardees are attempting to and have some success in 
receiving Phase II awards and commercializing their research. As a 
result, these benchmarks will only apply to those Phase I applicants 
that have received a certain number of prior Phase I awards.
    In addition, the Reauthorization Act requires agencies to make STTR 
award decisions within a certain amount of time after the close of the 
solicitation. The purpose of this statutory amendment is to reduce the 
gap in time between submission of application and time of award, which 
is an important issue for many small businesses.
    Further, the STTR Policy Directive sets forth the new maximum 
thresholds for Phase I and Phase II awards at $150,000 and $1,000,000, 
respectively. SBA will adjust these amounts every year for inflation 
and will post the adjusted numbers on www.SBIR.gov.

C. STTR Program Administration

    With respect to each agency's administration of the STTR Program, 
the Policy Directive incorporates the following new requirements:
     Addressing statutory changes for technical assistance 
provided to STTR awardees;
     Creating and setting forth the policies for the new pilot 
program that permits agencies to use SBIR money for administration of 
the STTR program; and
     Setting forth the new reporting and data collection 
requirements.
    The Act had previously permitted agencies to contract with vendors 
to provide technical assistance to STTR awardees (e.g. assist STTR 
awardees in making better technical decisions on STTR projects and 
commercializing the STTR product or process). The Reauthorization Act 
amended this current requirement, and SBA has amended the directive, to 
permit agencies to contract with a vendor for a period of up to 5 
years, permit an agency to provide technical assistance to an STTR 
awardee in an amount up to $5,000 per year (previously the limit had 
been $4,000 per award), and permit the small business to elect to 
acquire the technical assistance services itself.
    In addition, the Reauthorization Act creates a pilot program that 
permits agencies to use SBIR funds for certain administrative purposes 
for the STTR Program. SBA has amended the STTR

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Policy Directive to set forth when and how agencies may begin using 
this pilot program authority and to explain that agencies may use no 
more than 3% of their SBIR funds for one or more of the specified 
activities.
    SBA has also amended the Policy Directive to address the reporting 
requirements for both the STTR participating agencies and STTR 
applicants, many of which are newly required by various parts of the 
Reauthorization Act. Both applicants and agencies will be able to 
provide the statutorily required information into one or more of seven 
specific databases, collectively referred to as Tech-Net, which will be 
available at www.SBIR.gov. The seven databases are the: (1) 
Solicitations; (2) Company Registry; (3) Application Information; (4) 
Award Information; (5) Commercialization; (6) Annual Report; and (7) 
Other Reports Databases.
    The directive explains that the Solicitations Database will collect 
all solicitations and topic information from the participating STTR 
agencies. The Company Registry will house company information on all 
STTR applicants and information on SBC applicants that are majority-
owned by multiple VCOCs, hedge funds or private equity firms. The 
Application Information Database will contain information concerning 
each STTR application, which will be uploaded by an STTR agency. The 
Award Information Database will store information about each STTR 
awardee and must also be uploaded by the STTR agency. The 
Commercialization Database will store commercialization information for 
SBCs that have received STTR awards. The Annual Report Database will 
include all of the information required by the Small Business Act, 
including the new requirements set forth in the Reauthorization Act 
regarding the Annual Report that SBA submits to Congress. SBA receives 
the information for the annual report from the various STTR agencies 
and departments. The Other Reports Database will include information 
that is required by statute to be submitted, but does not fit into any 
of the other databases.

D. Fraud, Waste and Abuse

    Finally, this Policy Directive incorporates several amendments 
relating to fraud, waste and abuse, such as:
     Requiring small businesses to certify they are meeting the 
program's requirements during the life cycle of the funding agreement; 
and
     Establishing specific measures to ensure agencies are 
preventing fraud, waste and abuse in the program.
    As in the past, each small business that receives STTR funding must 
certify that it is in compliance with the laws relating to the program. 
However, SBA has amended the directive to state that these STTR 
awardees must also submit certifications that they meet the program's 
requirement at certain points during the life cycle of the award and 
provides agencies with the discretion to request additional 
certifications throughout the life cycle of the award.
    In addition to lifecycle certifications, the Policy Directive 
includes other measures to prevent fraud, waste and abuse in the STTR 
Program. For example, agencies must include on their Web site and in 
each solicitation any telephone hotline number or web-based method for 
how to report fraud, waste and abuse; designate at least one individual 
to serve as the liaison between the STTR Program, Office of Inspector 
General (OIG) and the agency's Suspension and Debarment Official (SDO); 
include on the agency's Web site successful prosecutions of fraud, 
waste and abuse in the STTR Program; and create or ensure there is a 
system to enforce accountability (e.g., creating templates for 
referrals to the OIG or SDO), among other things.
    Additional detail about all of these amendments to the directive is 
set forth below.

II. Background

    In 1992, Congress enacted the Small Business Research and 
Development Enhancement Act of 1992 (SBRDEA), Public Law 102-564 
(codified at 15 U.S.C. 638), which established the Small Business 
Technology Transfer Program (STTR Program). The statutory purpose of 
the STTR Program is to stimulate a partnership of ideas and 
technologies between innovative small business concerns (SBCs) and 
Research Institutions through Federally-funded research or research and 
development (R/R&D). By providing awards to SBCs for cooperative R/R&D 
efforts with Research Institutions, the STTR Program assists the small 
business and research communities by commercializing innovative 
technologies.
    SBRDEA requires the U.S. Small Business Administration (SBA) to 
``issue a policy directive for the general conduct of the STTR programs 
within the Federal Government.'' 15 U.S.C. 638(p)(1). The purpose of 
the Policy Directive is to provide guidance to the Federal agencies 
participating in the program.
    On December 31, 2011, the President signed into law the National 
Defense Authorization Act for Fiscal Year 2012 (Defense Reauthorization 
Act), Public Law 112-81, 125-Stat. 1298. Section 5001, Division E of 
the Defense Authorization Act contains the SBIR/STTR Reauthorization 
Act of 2011 (Reauthorization Act), which amends the Small Business Act 
and makes several amendments to the STTR Program. The Reauthorization 
Act requires that SBA issue amendments to the STTR Policy Directive and 
publish the amendments in the Federal Register by June 27, 2012.
    As a result of the abbreviated time frame set forth in the 
Reauthorization Act by which SBA is required to issue the amended 
Policy Directive, the Agency was unable to conduct public outreach 
prior to drafting and issuing the directive. Therefore, SBA is 
soliciting public comments on this final directive, and may amend the 
directive in response to these comments at a later time. SBA also plans 
to conduct public outreach sessions following publication, such as town 
hall meetings and webinars, to gather additional input on these 
statutory provisions and SBA's implementation. SBA will release more 
information about these public sessions later, which will be available 
at www.SBIR.gov. The SBA notes that it consulted with the STTR 
participating agencies when drafting these amendments.

III. Amendments

    SBA has amended the STTR Policy Directive to address the various 
sections of the Reauthorization Act. SBA's amendments are set forth in 
an analysis below, based on the specific section of the directive. SBA 
welcomes comments on all issues arising from this notice.
    SBA notes that it intends to update its Policy Directive on a 
regular basis and over the next year it plans to restructure and 
reorganize the directive as well as address certain policy issues 
(e.g., those concerning data rights). However, at this time it is 
amending the directive primarily to implement the new provisions 
contained in the Reauthorization Act.

A. Section 1--Purpose

    Section 5144 of the Reauthorization Act requires SBA to issue 
regulations or guidelines to simplify the application and award 
process. The Reauthorization Act requires SBA to issue such guidelines 
or regulations after an opportunity for notice and public comment. The 
regulations or guidelines must take into consideration the unique needs 
of each Federal agency, yet ensure

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that program proposal, selection, contracting, compliance, and audit 
procedures are simplified and standardized across participating 
agencies. This includes reducing the paperwork and regulatory 
compliance burden on small business concerns applying to and 
participating in the STTR Program.
    SBA has amended the directive to fulfill this statutory requirement 
to simplify and standardize the proposal, selection, contracting, 
compliance, and audit procedures for the STTR program to the extent 
practicable while allowing the STTR agencies flexibility in the 
operation of their individual STTR Programs. Wherever possible, SBA has 
attempted to reduce the paperwork and regulatory compliance burden on 
SBCs applying to and participating in the STTR Program while still 
meeting the statutory reporting and data collection requirements. For 
example, as discussed later in this notice, SBA has created a program 
data management system for collecting and storing application 
information that will be utilized by all STTR agencies, thus 
eliminating the need for STTR applicants to submit the same data to 
multiple agencies.
    SBA requests comments on other ways it can simplify and standardize 
these requirements. Specifically, SBA requests comments on ways improve 
the application process, including simplifying and streamlining that 
process.

B. Section 2--Summary of Statutory Provisions

    SBA has implemented section 5101 of the Reauthorization Act by 
amending section 2 to clarify that the STTR Program is extended until 
September 30, 2017, unless otherwise provided in law. In addition, in 
order to implement section 5102 of the Reauthorization Act, SBA has 
amended section 2 of the directive to address the increase in the 
minimum percentages of an agency's extramural budget for R/R&D that 
must be awarded to SBCs under the STTR program. As required by statute, 
the minimum percentages will increase by .05% every two fiscal years 
through fiscal year 2017. The directive clarifies that agencies may 
exceed these minimum percentages and make additional awards to SBCs 
under this program.

C. Section 3--Definitions

    SBA has amended the definition of ``commercialization'' as required 
by section 5125 of the Reauthorization Act. Further, SBA has amended 
the definition for the term ``small business concern'' by simply 
referencing its size regulations at 13 CFR 121.701-705. Those size 
regulations define the ownership and size requirements for the SBIR and 
STTR Programs. SBA has recently issued a rule proposing to amend those 
regulations and the definition of ``small business concern'' for 
purposes of the SBIR and STTR Programs as a result of certain 
provisions of the Reauthorization Act (see 77 FR 30227 (May 22, 2012)). 
SBA believes the proposed rule will not become final until late 2012. 
In order to ensure that any changes made to the definition of ``small 
business concern,'' which become effective in the regulation in late 
2012, are incorporated into the Policy Directive, it is best to simply 
reference the regulation in the Policy Directive at this time. When SBA 
issues the final regulations defining ``small business concern,'' SBA 
intends to amend the Policy Directive to explicitly incorporate the new 
definition rather than only reference the regulation.

D. Section 4--Competitively Phased Structure of the Program

    SBA amended the introductory paragraph to this section of the 
Policy Directive to explain that agencies must issue STTR awards 
pursuant to competitive and merit-based selection procedures. This 
amendment implements section 5162 of the Reauthorization Act.
    SBA also amended this paragraph to explain that agencies may not 
use investment of venture capital, hedge funds or private equity firms 
as a criterion for a Phase I, Phase II or Phase III award. This 
amendment is required by section 5107(a) of the Reauthorization Act.
1. Section 4(a)--Phase I Awards
    SBA has amended this section of the directive, which addresses 
Phase I awards, to incorporate the provisions of section 5165 of the 
Reauthorization Act concerning agency measures of progress towards 
commercialization. Specifically, section 5165 requires that agencies 
establish standards, or benchmarks, to measure the success of Phase I 
awardees in receiving Phase II awards. These standards are referred to 
as the ``Phase I-Phase II'' Transition Rate benchmarks in the Policy 
Directive. Section 5165 also requires agencies to establish benchmarks 
to measure the success of Phase I awardees in receiving Phase III 
awards. These standards are referred to as the ``Commercialization 
Rate'' benchmarks in the Policy Directive.
    STTR agencies must establish the Phase I-Phase II benchmark rate 
and have received SBA approval for the rate by October 1, 2012. 
Agencies must establish the Commercialization Rate and have received 
SBA approval for the rate by October 1, 2013. Any subsequent changes in 
the benchmarks must be approved by SBA.
    Once established, agencies will only apply these benchmarks to 
those Phase I applicants that have received more than 20 Phase I awards 
or more than 15 Phase II awards over the prior 5 fiscal years 
(excluding the most recently completed two fiscal years). However, at 
the agency's option, it may apply the benchmark to a Phase I applicant 
that has received more than 20 Phase I awards over the prior 10 or 15 
fiscal years (excluding the most recently completed fiscal year) or has 
received more than 15 Phase II awards over the prior 10 or 15 fiscal 
years (excluding the most recently completed two fiscal years).
    With the Phase I-Phase II Transition Rate, each agency must 
establish the minimum number of Phase II awards a small business must 
have received for a given number of Phase I awards over the preceding 
5, 10, or 15 fiscal years (excluding the most recently completed fiscal 
year). For example, an agency may state that its Phase I-Phase II 
Transition Rate requires an STTR Phase I applicant to have received at 
least one Phase II award for every five Phase I awards received in the 
prior 10 fiscal years. Another agency could state that its Phase I-
Phase II Transition Rate requires an STTR Phase I applicant to have 
received at least one Phase II award for every ten Phase I awards 
received in the prior 5 fiscal years. Agencies will set the benchmark 
as appropriate for the specific agency's STTR Program, taking into 
consideration the fact that Phase I is intended to explore high-risk, 
early-stage research and therefore many Phase I awards will not result 
in a Phase II award.
    With the Commercialization Rate, each agency must establish the 
level of Phase III commercialization results a small business must have 
received from work performed under prior Phase II awards over the 
preceding 5, 10, or 15 fiscal years (excluding the most recently 
completed two fiscal years). Agencies have discretion to define this 
benchmark in a number of ways, including: in financial terms (e.g., 
dollar value of revenues and additional investment per dollar value of 
Phase II awards); in terms of the share of Phase II awards that have 
resulted in the introduction of a product to the market relative to the 
number of Phase II awards received; or by other means (e.g.,

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a commercialization score or index). SBA is aware that some agencies 
currently have a commercialization benchmark they are using. The 
directive provides the agencies with the discretion to continue to use 
those benchmarks or establish new Commercialization Rates relevant to 
that agency.
    We note that the Reauthorization Act refers to ``the success of 
small business concerns with respect to the receipt of Phase III SBIR 
or STTR awards'' when determining the Commercialization Rate benchmark. 
However, the SBA understands that the intent of this provision is to 
measure success at commercializing STTR technology not only in the 
Federal procurement market in the form of Phase III awards, but also in 
the private market place through sales or other means. Therefore, SBA 
has drafted the Policy Directive in a manner consistent with this 
understanding.
    SBA will maintain a system that records all Phase I and Phase II 
awards and calculates these benchmark rates. The small business will be 
able to provide these rates to the STTR agency with its application. 
The Reauthorization Act requires that each agency determine whether an 
STTR Phase I applicant meets both of these benchmarks. If the applicant 
does not meet both of the benchmarks, then by statute it is not 
eligible for the Phase I award and it is not eligible for any other 
STTR Phase I awards from that agency for a period of one year from the 
date it submitted the application to the agency and was determined 
ineligible for failure to meet the benchmark. That applicant, however, 
may be eligible for a Phase I award from a different agency if it meets 
that particular agency's benchmarks. If the applicant does meet the 
particular agency's benchmark rates, the agency will still evaluate the 
applicant's commercial potential for the specific R&D in that 
application and base this evaluation on agency-specific criteria.
    The purpose of this statutory provision is to ensure that STTR 
awardees are attempting to commercialize their R&D. SBA understands 
that not all Phase I awardees will receive Phase II awards due to many 
factors, such as the exploratory nature of Phase I awards, insufficient 
funding for Phase II awards, and changes in requirements for the 
agency. SBA has taken all of this into consideration when drafting 
these benchmark provisions, while also allowing agencies flexibility in 
setting the benchmarks.
2. Section 4(b)--Phase II Awards
    SBA has amended this section of the directive, which addresses 
Phase II awards, to set forth two new statutory exceptions to the 
general rule that only STTR Phase I awardees may receive an STTR Phase 
II award. According to section 5104 of the Reauthorization Act, a 
Federal agency may now issue an STTR Phase II award to an SBIR Phase I 
awardee in order to further develop the work performed under the SBIR 
Phase I award.
    SBA has also amended this section of the directive to state that 
agencies may not use an invitation, pre-screening, or pre-selection 
process for determining eligibility for a Phase II award. Agencies must 
set forth a notice in each solicitation stating that all Phase I 
awardees are eligible to apply for a Phase II award and must provide 
specific guidance on how to apply. This amendment is required by 
section 5105 of the Reauthorization Act.
    Finally, SBA amended this section to address section 5111 of the 
Reauthorization Act, concerning multiple Phase II awards. Specifically, 
agencies may now issue one additional, sequential Phase II award to 
continue the work of an initial Phase II award. Therefore, a small 
business may receive no more than two STTR Phase II awards for the same 
R&D project, and the awards must be made sequentially.
3. Section 4(c)--Phase III Award
    SBA amended this section to address the specific statutory 
directive at section 5108 of the Reauthorization Act that agencies, to 
the greatest extent practicable, shall issue Phase III awards to the 
STTR awardee that developed the technology. Agencies may issue sole 
source Phase III awards to the STTR Phase I or Phase II awardee to meet 
this statutory requirement. At times, agencies have failed to use this 
authority, bypassed the small business that created the technology, and 
pursued the Phase III work with another business. Congress has 
expressed, again, and now in stronger terms, a clear intent for the 
agencies to issue Phase III awards to the STTR awardees that created 
the technology so that these small businesses can commercialize it.
    SBA requests comments, however, on whether it should define ``to 
the greatest extent practicable'' with respect to when agencies shall 
issue these Phase III awards, and if so, how it should define the 
phrase. For example, if the agency elects not to issue a Phase III sole 
source award to the STTR Phase II awardee for follow-on Phase III work, 
then SBA requests comments on what other ways, if any, the agency could 
meet this statutory requirement (e.g., whether STTR preference is an 
option within the context of a full and open competition).

E. Section 6--Eligibility and Application (Proposal) Requirements

1. Section 6(a)--Eligibility Requirements
    SBA amended this section of the directive to address the new 
statutory requirements concerning small businesses that are majority-
owned by venture capital operating companies (VCOCs), hedge funds or 
private equity firms. Specifically, section 5107 of the Reauthorization 
Act states that businesses that are owned in majority part by VCOCs, 
private equity firms or hedge funds may be eligible to participate in 
the SBIR Program, under certain conditions.
    First, SBA must amend its size regulations at 13 CFR part 121, to 
address ownership, control, and affiliation for these businesses. SBA 
has issued a proposed rule addressing this issue, with a request for 
comments. While Section 5107 of the Reauthorization Act addresses only 
the SBIR program, SBA has proposed changing the ownership, control, and 
affiliation rules effecting SBCs that participate in both the SBIR and 
STTR programs. This was done to maintain conformity between the 
programs. The new ownership, control, and affiliation rules will not be 
in effect until a final rule is issued.
    Second, if the agency elects to use this authority, it must submit 
a written determination letter to SBA, the Senate Committee on Small 
Business and Entrepreneurship, the House Committee on Small Business 
and the House Committee on Science, Space, and Technology. The agency 
must explain how awards to small business that are majority-owned by 
multiple VCOCs, hedge funds or private equity firms will induce similar 
and additional funding of small business innovations, contribute to the 
mission of the agency, demonstrate a need for public research, and 
otherwise fulfill the capital needs of small businesses for SBIR (or 
STTR) projects.
    Third, small businesses that are majority-owned by multiple VCOCs, 
hedge funds or private equity firms must register with the SBA prior to 
submitting an STTR application. Once SBA issues a final rule amending 
13 CFR part 121 concerning ownership and control of STTR applicants, 
the ownership and control rules will be in effect, and the registration 
will be available at www.SBIR.gov.

[[Page 46860]]

    Finally, agencies electing to use this authority may only issue a 
certain percentage of their STTR awards to small businesses that are 
majority-owned by multiple VCOCs, hedge funds or private equity firms. 
The National Institute of Health (NIH), Department of Energy (DOE), and 
the National Science Foundation (NSF) may award not more than 25% of 
their SBIR funds to such small businesses. All other SBIR agencies may 
award not more than 15% of their SBIR funds to these small businesses. 
If the agency has not exceeded these maximum statutory percentages, the 
participating agencies may make awards to small businesses that are 
majority-owned by multiple VCOCs, hedge funds or private equity firms 
under the STTR Program. If an agency exceeds this maximum statutory 
percentage of awards, it must transfer this excess amount from its non-
SBIR and non-STTR funds to the SBIR funds.
    SBA considered amending the requirement concerning the principal 
investigator's primary employment. Specifically, SBA considered further 
defining primary employment to mean that the principal investigator 
must perform at least 51% of his/her work (as opposed to the current 
requirement that they perform a minimum of one half), based on a 40-
hour workweek, in the employ of either the research institution or 
small business. SBA seeks comments on whether this further 
clarification is needed.
2. Section 6(b)--Proposal Requirements
    SBA amended this section to address the certification requirements 
at the time an SBC submits its proposal and at the time it receives an 
STTR award. Section 5143 of the Reauthorization Act requires each STTR 
awardee to certify that it is in compliance with the laws relating to 
the program. SBA's Administrator is required to develop, in 
consultation with the Council of Inspectors General on Integrity and 
Efficiency, the procedures and requirements for this certification 
after providing notice of and an opportunity for public comment on such 
procedures and requirements. SBA requested public input on its 
certification requirements in the ownership and control proposed rule. 
SBA will consider further input received on this final directive.
    In the directive, SBA explains that all applicants that are 
majority-owned by multiple VCOCs, hedge funds or private equity firms 
must submit a certification and register at www.SBIR.gov (once SBA 
issues a final regulation amending 13 CFR part 121). The specifics 
relating to the certification and registration database are discussed 
later in Section 10.
    Further, all STTR awardees must submit a certification at the time 
of award stating that it meets the size, ownership and other 
requirements of the STTR Program. The directive explains that agencies 
may request similar certifications prior to award, such as at the time 
of submission of the application. The specifics relating to the 
certification is discussed later in this notice.
    In addition to the certification requirements, section 5132-5135 of 
the Reauthorization Act requires that STTR applicants and awardees 
provide to agencies certain information concerning their ownership, 
investors, and principal investigators, among other things. In an 
effort to streamline and simplify this data collection, SBA requires 
that the small business provide this information to the databases 
available at www.SBIR.gov, rather than to each individual agency with 
each STTR application or award. The specifics relating to this 
certification and data collection are discussed below in Section 10.

F. Section 7--STTR Funding Process

1. Section 7(c)--Selection of Awardees
    Section 5126 of the Reauthorization Act requires agencies to make 
award decisions within a certain amount of time after the close of the 
solicitation. The purpose of this statutory amendment is to reduce the 
gap in time between submission of application and time of award, which 
is an important issue for many small businesses. For example, if an 
agency takes a long time to make an award, it may be difficult for the 
small business to retain its key personnel, such as the principal 
investigator.
    The Reauthorization Act requires, and the directive explains, that 
NIH and NSF must issue a notice to each applicant as to whether it has 
been selected for an award within one year from the closing date of the 
solicitation. The directive states that NIH and NSF should then issue 
the actual award within 15 months of the closing date of the 
solicitation. All other agencies must issue a notice to each applicant 
as to whether it has been selected for an award within 90 calendar days 
from the closing date of the solicitation. The directive states that 
the agencies should then issue the actual award within 180 calendar 
days of the closing date of the solicitation.
    If an agency will not be able to issue the notice within the 
statutorily required time, it must request an extension of time from 
SBA. The written request must specify the number of additional days 
needed to make the award decision and must be submitted to the SBA at 
least 10 business days prior to when the agency is required to issue 
the award decision to the applicants. SBA explains in the Policy 
Directive that even if it grants an extension of time, the STTR agency 
still has the responsibility to work toward issuing quicker awards and 
meeting the statutory timeframes.
2. Section 7(i)--Dollar Value of Awards
    SBA amended this section of the directive to implement section 5103 
of the Reauthorization Act, which sets the maximum thresholds for Phase 
I and Phase II awards at $150,000 and $1,000,000, respectively. SBA 
will adjust these amounts every year for inflation and will post the 
adjusted numbers on www.SBIR.gov.
    Section 5103 of the Reauthorization Act also states that agencies 
may exceed these thresholds by no more than 50%, unless the agency 
requests and is granted a waiver from SBA. SBA has amended the 
directive to set forth this new statutory requirement. In addition, as 
stated in the directive, when submitting a request for a waiver to 
exceed the award guidelines, the waiver must be for a specific topic, 
and not for the agency as a whole. SBA notes that the Reauthorization 
Act only permits a waiver by topic. Further, the directive explains 
that when seeking the waiver, the agency must provide evidence showing 
that the limitations on the award size will interfere with its mission 
and that the research costs for the topic area differ significantly 
from other areas, among other things.

G. Section 8--Terms of Agreement Under STTR Awards

    As discussed above, section 5143 of the Reauthorization Act 
requires each applicant that applies for and each small business that 
receives STTR funding to certify that it is in compliance with the laws 
relating to the program. Section 5143 specifically states that such 
certifications may cover the life cycle of the funding agreement.
    As a result, SBA has amended this section of the directive to state 
that for Phase I awards, agencies must require that awardees submit a 
certification as to whether they are in compliance with specific STTR 
Program requirements at the time of final payment or disbursement. For 
Phase II awards, agencies must require that awardees submit a 
certification as to whether they are in compliance with specific STTR 
Program requirements prior to receiving

[[Page 46861]]

more than 50% of the total award amount and prior to final payment or 
disbursement. The directive provides the agencies with the discretion 
to request additional certifications throughout the life cycle of the 
award since SBA is aware that some agencies request certification at 
the time of each payment.
    SBA notes that these certifications are in addition to, and 
different in content from the certification required at the time of 
award. SBA requests comments on the certification requirements, 
including whether additional certifications should be required to 
prevent fraud, waste and abuse.

H. Section 9--Responsibilities of STTR Participating Agencies and 
Departments

1. Section 9(c)--Discretionary Technical Assistance
    The Small Business Act currently permits agencies to contract with 
vendors who provide technical assistance to STTR awardees. Section 5121 
of the Reauthorization Act amended this current requirement to permit 
agencies to contract with vendors for a period of up to 5 years. In 
addition, the Reauthorization Act states that the contract with the 
vendor cannot be based upon the total number of Phase I or Phase II 
awards. The contract, however, may be based on the total amount of 
awards for which actual technical assistance was provided. The 
directive addresses these new requirements.
    The Reauthorization Act permits an agency to provide technical 
assistance to an STTR awardee in an amount up to $5,000 per year 
(previously the limit had been $4,000 per award). This amount is in 
addition to the award amount.
    The Reauthorization Act also permits the small business to elect to 
acquire the technical assistance services itself. Some believe that 
allowing a small business to obtain such services itself may create 
conflicts or potential abuses. To negate these concerns, SBA has 
required that the applicant must request to do so in its STTR 
application, and must demonstrate that the individual or entity 
selected can provide the specific technical services needed. If the 
awardee demonstrates this requirement sufficiently, the Reauthorization 
Act states that the agency must permit the awardee to acquire the 
needed technical assistance itself, as an allowable cost. SBA has 
incorporated these new statutory authorities into the directive. SBA 
welcomes comments on this amendment and other ways it can limit 
potential abuses of the technical assistance allowance.
2. Section 9(d)--Interagency Actions
    SBA amended the directive to address section 5104 of the 
Reauthorization Act, which requires that when one agency issues an STTR 
Phase II award to an STTR Phase I awardee of another agency, both 
agencies must issue a written determination that the topics of the 
awards are the same. The agencies must submit this report to SBA.
3. Section 9(e)--Limitation on Use of Funds
    Section 5141 of the Reauthorization Act creates a pilot program 
that permits agencies to use SBIR funds for certain administrative 
purposes. Prior to this amendment, agencies were not permitted to use 
SBIR funds for any purpose other than awards and technical assistance 
to small businesses.
    SBA has amended the SBIR Policy Directive to state that beginning 
on October 1, 2012, and ending on September 30, 2015, and upon 
establishment by SBA of the agency-specific performance criteria, SBA 
shall allow agencies to use no more than 3% of their SBIR funds for one 
or more specific activities. Specifically, the funding is to be used to 
assist with the substantial expansion in commercialization reporting; 
fraud, waste and abuse prevention; expanded reporting requirements; and 
other new activities required by the STTR Program. The administrative 
funds are not to be used to replace the agency's current administrative 
funding for the STTR Program (e.g., pay for current personnel) but to 
supplement the agency's current administrative funding (e.g. pay for 
new personnel to assist solely with STTR funding agreements) and cover 
the costs of new program initiatives.
    The Reauthorization Act requires agencies to use some of these 
funds to increase participation by socially and economically 
disadvantaged small businesses (SDBs) and women-owned small businesses 
(WOSBs) in the STTR Program, and small businesses in states with a 
historically low level of participation in the program. The agency may 
request a waiver of this statutory requirement by submitting a written 
statement explaining why there is a sufficient need for the waiver, and 
that the outreach objectives of the agency are already being met. The 
directive addresses this requirement.
    The Reauthorization Act states that agencies may not use the SBIR 
funds for any of these administrative purposes until SBA establishes 
performance criteria to measure the benefits of using the funds and to 
ultimately determine whether the pilot program should be continued, 
discontinued, or made permanent. The Policy Directive explains that in 
order to help SBA establish the agency-specific performance criteria, 
each agency must submit an annual work plan to SBA at least 30 calendar 
days prior to the start of a fiscal year. The work plan must set forth 
a prioritized list of initiatives to be supported in alignment with 
reporting requirements, the estimated amounts to be spent on each 
initiative, milestones for implementing the initiatives, the expected 
results to be achieved, and the assessment metrics for each initiative. 
The work plan must explain how these initiatives are above and beyond 
the agency's current practices and how they will enhance the program.
    After review of the work plan, SBA will establish the performance 
metrics for that fiscal year by which use of these funds will be 
evaluated for that fiscal year. SBA will create a simplified template 
for agencies to use when creating their work plans. Agencies will 
submit work plans to SBA each fiscal year the pilot program is in 
operation.
    The Policy Directive also explains that any activities relating to 
fraud, waste and abuse prevention in the work plan must be coordinated 
with the agency's Office of Inspector General (OIG). If the agency 
allocates more than $50,000,000 to its SBIR Program for a fiscal year, 
some of these administrative funds may be used to cover the costs 
incurred by the OIG when the OIG performs fraud, waste and abuse 
activities for the agency's STTR Program.
    SBA also amended this section of the Policy Directive to address 
the new statutory requirement set forth in section 5109 of the 
Reauthorization Act that permits agencies to subcontract a portion of 
an STTR funding agreement to a Federal laboratory. Although agencies 
may permit small businesses to subcontract a portion of the work to the 
Federal laboratory without requesting a waiver from SBA, the agency 
cannot require a small business to subcontract a portion of the award 
to the laboratory.
4. Section 9(f)--Preventing Fraud, Waste, and Abuse
    Section 5143 of the Reauthorization Act requires SBA to amend the 
Policy Directive to include measures to prevent fraud, waste and abuse 
in the STTR Program. SBA has amended the directive to define and 
provide examples of fraud, waste and abuse as it relates to the STTR 
Program. In addition, SBA has amended the

[[Page 46862]]

directive to state that each STTR agency must take certain measures to 
reduce fraud, waste and abuse in the program.
    For example, at the recommendation of the Council for Inspectors 
General on Integrity and Efficiency, the SBA has included the 
requirement for certification by the small business during the life 
cycle of the funding agreement. As discussed above, this means that in 
addition to requiring a certification at the time of award, agencies 
must request certifications by the small business concern during 
certain points in time of a Phase I and Phase II funding agreement to 
ensure that the awardee is in compliance with the program's 
requirements.
    The directive explains that agencies must also take other measures 
to reduce fraud, waste and abuse, such as: (1) Including on their Web 
site and in each solicitation any telephone hotline number or web-based 
method for reporting fraud, waste, and abuse; (2) designating at least 
one individual to serve as the liaison between the STTR Program, OIG 
and the agency's Suspension and Debarment Official (SDO); (3) including 
on the agency's Web site successful prosecutions of fraud, waste and 
abuse in the STTR Program (relating to any STTR agency); and (4) 
creating or ensuring there is a system to enforce accountability (e.g., 
creating templates for referrals to the OIG or SDO), among other 
things. In addition, the directive requires the agencies to work with 
their specific OIG, who will help establish fraud detection indicators. 
For example, one agency, acting in concert with its OIG, uses a 
commercial software that searches for redundancy or plagiarism in the 
applications submitted. This is one form of a fraud detection 
indicator.
    SBA welcomes comments on other ways agencies may reduce fraud, 
waste and abuse in the program.
5. Section 9(g)--Interagency Policy Committee
    Section 5124 of the Reauthorization Act instructs the Office of 
Science and Technology Policy (OSTP) to create the Interagency Policy 
Committee, comprised of OSTP, the SBIR and STTR participating agencies 
and SBA. The purpose of this committee is to review issues relating to 
the STTR program, such as commercialization assistance, and make 
recommendations on ways to improve the program. SBA has amended the 
directive to address this new committee.
6. Section 9(h)--National Academy of Science Report
    Section 5137 of the Reauthorization Act requires the National 
Academy of Sciences (NAS) to conduct a comprehensive study of how the 
STTR program has stimulated technological innovation. NAS must consult 
with and consider the views of SBA, as well as other interested 
parties, when drafting the report. In addition, the statute requires 
certain agencies, in consultation with SBA, to enter into an agreement 
with NAS in furtherance of the report. SBA has amended the Policy 
Directive to address this new requirement, since NAS will be issuing 
the report not later than 4 years after December 31, 2011 and then 
every subsequent four years. Details about the study are set forth in 
Appendix X.

I. Section 10--Agency and STTR Applicant/Awardee Reporting Requirements

    SBA has amended this section of the Policy Directive to address the 
reporting requirements for both the STTR participating agencies and 
STTR applicants, many of which are newly imposed by various parts of 
the Reauthorization Act. In an effort to streamline and standardize the 
various reporting requirements, SBA will be gathering this information 
at one source--www.SBIR.gov. Both applicants and agencies will be able 
to provide the statutorily required information into one or more 
specific databases, collectively referred to as Tech-Net. These 
requirements will be phased in over a period of time according to a 
plan that is complementary to but not part of the Policy Directive.
    SBA published a notice in the Federal Register, 77 FR 16313, on 
March 20, 2012, explaining this data collection and seeking comments. 
One of the comments expressed concern that SBA was unnecessarily 
seeking information from small businesses. This is not the case. The 
Reauthorization Act sets forth a number of data requests SBA and the 
STTR agencies are required to collect from small businesses. This data 
collection is intended to ensure that only those small businesses that 
meet the requirements of the program receive an STTR award and to 
enable assessment of the program.
    SBA has sought to reduce any burdens this data collection may have 
on small businesses. Because SBA will be collecting the data at one 
location, small business and agencies will only have to input certain 
information once, and then update as necessary. For example, when a 
small business inputs information for the Company Registry, some of the 
information will populate some fields in other databases, such as the 
Commercialization Database. Likewise, if an agency provides awardee 
information in the Awardee database, some of information will populate 
the Annual Report Database.
    The seven databases addressed in the directive are the: (1) 
Solicitations; (2) Company Registry; (3) Application Information; (4) 
Award Information; (5) Commercialization; (6) Annual Report; and (7) 
Other Reports Databases. SBA currently has some of these databases 
ready for operation with the needed data fields and anticipates a 
phased implementation for the remaining databases and data fields.
    The directive explains that the Solicitations Database will collect 
all solicitations and topic information from the participating STTR 
agencies. It will serve as the primary source for small businesses 
searching for STTR solicitations. Agencies must therefore update this 
database within 5 business days after a solicitation's open date. SBA 
will have a Master Schedule showing all agency solicitation open and 
close dates.
    The Company Registry will house company information on all STTR 
applicants. It will contain information on SBC applicants that are 
majority-owned by multiple VCOCs, hedge funds or private equity firms, 
which by statute are required to register in an SBA database prior to 
submitting an SBIR or STTR application. This database will also house 
the registration information for those SBCs that receive an award as a 
result of the Civilian Agency Commercialization Readiness Pilot 
Program. All potential STTR applicants will be required to register in 
the Company Registry prior to submitting an STTR application.
    SBA believes it is important to maintain such a Company Registry 
for several reasons. First, in order to prevent fraud, waste and abuse 
it would be best to house the data in one place so that the company 
must register itself and use that same registration (same name and 
identifying number) for each application. In addition, at the time the 
company registers, SBA intends to have online information relating to 
eligibility to ensure that the business understands the requirements of 
the program. Second, certain information on applicants is required by 
statute and therefore it would be best to have the applicant enter the 
data once (and update as needed), instead of each time it submits an 
application to an agency. Third, this registration is no different than 
others used in Federal contracting,

[[Page 46863]]

such as the Central Contractor Registration (CCR). There are numerous 
small businesses that are registered in CCR and it does not appear to 
be a burden or difficult for small businesses to register their 
information into a central database in order to receive a contracting 
benefit afforded small businesses.
    The directive also explains that the Application Information 
Database will contain information concerning each STTR application, 
which will be uploaded by an agency at least quarterly. Some of the 
information inputted by the STTR applicant into the Company Registry 
will filter to this database. Other information, such as the contact 
information for the Federal employee reviewing the applications and 
making awards, will need to be inputted by the agency. This database 
will also contain information required by section 5135 of the 
Reauthorization Act, including information relating to the names of key 
individuals that will carry out the project and the percentage of 
effort the individual will contribute to the project.
    The Award Information Database will store information about each 
STTR awardee and must be updated by the agency quarterly. Award data is 
generally reviewable and searchable by the public. Some of the 
information collected from the Company Registry and Application 
Information Database will filter to this database.
    The Commercialization Database will store commercialization 
information for SBCs that have received STTR awards. This includes 
information relating to revenue from the sale of new products or 
services resulting from the R&D conducted under a Phase II award and 
any business or subsidiary established for the commercial application 
of a product or services for which an STTR award is made, among other 
things. The information contained in this database will be used by SBCs 
and agencies to determine whether the SBC meets the agency's 
commercialization benchmarks, discussed above, and for program 
evaluation purposes. SBCs may provide the information to the SBA's 
database directly or to the agency, which will collect it and upload it 
to SBA's database.
    The Annual Report Database will include all of the information 
required by the Small Business Act, including the new requirements set 
forth in the Reauthorization Act regarding the Annual Report that SBA 
submits to Congress. SBA receives the information for the annual report 
from the various STTR agencies and departments. To reduce the burden on 
the agencies and departments, data from the other databases will filter 
to the Annual Report Database. Agencies must provide the other 
information for the annual report to SBA by March 15th each year.
    Some of the information that agencies will be required to provide 
by March 15 includes new information required by the Reauthorization 
Act, such as an analysis of the various activities considered for 
inclusion in the Commercialization Program for civilian agencies set 
forth in section 12(c) of the directive and a description of the extent 
to which the agency is increasing outreach and awards to SDBs and 
WOSBs.
    The Other Reports Database will include information that is 
required by statute to be submitted, but does not fit into any of the 
other databases. For example, section 5110 of the Reauthorization Act 
requires agencies to provide SBA notice of any case or controversy 
before any Federal judicial or administrative tribunal concerning the 
STTR Program of the Federal agency. A case or controversy between a 
Federal or administrative tribunal would not include agency level 
protests of awards unless and until the protest is before a Federal 
court or administrative body. It would include litigation that is 
before a Federal or State court, or administrative tribunal such as the 
Government Accountability Office. Further, section 5161 of the 
Reauthorization Act requires that agencies provide an annual report to 
the SBA, the Senate Committee on Small Business and Entrepreneurship, 
the House Committee on Small Business, and the House Committee on 
Science, Space, and Technology on the SBIR and STTR Programs and the 
benefits of these programs to the United States. The statute requires 
the final report be posted online so it can be made available to the 
public. This section lists this and other new reporting requirements, 
set forth in the Reauthorization Act, for the STTR agencies.
    Finally, SBA has a new section in the directive that identifies all 
of the waivers that may be requested and submitted by an agency to SBA, 
and which are discussed in various other parts of the directive. The 
following waivers may be granted by SBA: (1) An extension for 
additional time between the solicitation closing date and notification 
of recommendation for award; (2) permission to exceed the award 
guidelines for Phase I and Phase II awards by more than 50% for a 
specific topic; and (3) permission to issue a funding agreement that 
includes a provision for subcontracting a portion of that agreement 
back to the issuing agency if there is no exception to this requirement 
in the directive.

J. Section 11--Responsibilities of SBA

    SBA has amended this section of the directive to incorporate some 
new responsibilities of SBA and to include many responsibilities and 
activities SBA has undertaken over the last several years with respect 
to the program. These areas of responsibility include: (1) Policy, 
outreach, collection and publication of data; (2) monitoring 
implementation of the program and reporting to Congress; and (3) 
additional efforts to improve performance.
    First and most obvious, is that SBA is responsible for establishing 
the policies and procedures for the program by publishing and updating 
the STTR Policy Directive and promulgating regulations. As discussed 
above, SBA is also responsible for issuing waivers.
    SBA also conducts outreach to achieve a number of objectives 
including educating the public and the agencies about the STTR Program, 
highlighting successful SBC achievements, and maintaining www.SBIR.gov. 
Similarly, SBA must collect and maintain program-wide data within the 
Tech-Net data system (available at www.SBIR.gov). This data includes 
information on all Phase I and II awards from across all STTR 
participating agencies, as well as Fiscal Year Annual Report data.
    SBA also provides oversight and monitors the implementation of the 
STTR Program. This includes monitoring agency STTR funding allocations 
and program solicitation and awards as well as ensuring each 
participating agency has taken steps to maintain a fraud, waste and 
abuse prevention system to minimize adverse impact on the program.
    SBA is also responsible for defining areas of performance 
consistent with statute (e.g., timelines for award, simplification of 
STTR application process) and defining metrics against that 
performance. SBA will therefore measure performance against goals set 
by the STTR agencies. The purpose of these performance metrics and 
goals is to evaluate and report on the progress achieved by the 
agencies in improving the STTR Program. SBA discusses in detail the 
performance metrics and goals in section 10(i) of the directive.
    In addition to the above, SBA continuously seeks to improve the 
performance of the program and will make recommendations and 
modifications for such improvement. This may include sharing and

[[Page 46864]]

recommending agency ``best practices'' and other program-wide 
initiatives.
    All of these SBA responsibilities are set forth in section 11 of 
the directive.

K. Section 12--Supporting Programs and Initiatives

    This section of the policy directive sets forth various programs, 
including a new pilot program that seeks to enhance the 
commercialization efforts of small businesses. These programs also 
include the Federal and State Technology Partnership (FAST) Program, 
the DoD Commercialization Program, the Civilian Agency 
Commercialization Readiness Pilot Program, and the Phase 0 Proof of 
Concept Partnership Pilot Program.
    Section 5122 of the Reauthorization amended the DoD 
Commercialization Program by converting it from a pilot program into a 
permanent program. The purpose of this program is for DoD to accelerate 
the transition of technologies, products and services developed under 
the STTR Program to Phase III. The Reauthorization amended the program 
by creating an incentive requirement for any contract with a value of 
at least $100 million. For those contracts, DoD may establish goals for 
the transition of STTR technologies into the prime contractor's 
subcontracting plan and require the prime to report the number and 
value of subcontracts entered into for Phase III work with a prior STTR 
awardee.
    Section 5141 of the Reauthorization Act also amended the DoD 
Commercialization Program by stating that for FY 2013 through FY 2015, 
the Secretary of Defense and each Secretary of a military department 
may use no more than 3% of its SBIR funds for administration of this 
Commercialization Program. This means that the only SBIR funds that can 
be used for the administration of the DoD Commercialization Program 
must come from the Pilot to Allow for Funding of Administrative, 
Oversight, and Contract Processing Costs, discussed above. When that 
pilot program expires, which is the end of FY 2015, the statute 
provides that DoD may use not more than 1% of its SBIR funds available 
to DoD or the military departments to administer the Commercialization 
Program. Section 12 of the directive addresses this DoD program.
    Section 12 of the directive also sets forth the new Civilian Agency 
Commercialization Readiness Pilot Program. This new program is 
authorized by section 5123 of the Reauthorization Act and terminates on 
September 30, 2017, unless otherwise extended.
    This Commercialization Readiness Pilot Program is different from 
the DoD Commercialization Program. Under this program, a civilian 
agency participating in the STTR Program may allocate not more than 10% 
of its STTR funds: (1) for follow-on awards to small businesses for 
technology development, testing, evaluation, and commercialization 
assistance for SBIR or STTR Phase II technologies; or (2) for awards to 
small businesses to support the progress of research, research and 
development, and commercialization conducted under the SBIR or STTR 
programs to Phase III.
    Before establishing this pilot program, an STTR agency must submit 
a written application to SBA not later than 90 days before the first 
day of the fiscal year in which the pilot program is to be established. 
The written application must set forth a compelling reason that 
additional investment in SBIR or STTR technologies is necessary, 
including unusually high regulatory, systems integration, or other 
costs relating to development or manufacturing of identifiable, highly 
promising small business technologies or a class of such technologies 
expected to substantially advance the mission of the agency. SBA must 
make its determination regarding an application submitted not later 
than 30 days before the first day of the fiscal year for which the 
application is submitted and will publish its determination in the 
Federal Register. Under this pilot program, STTR agencies may make an 
award to a SBC up to three times the dollar amount generally 
established for Phase II awards under section 7(i)(1) of this 
directive. When making an award under this pilot program, the agency is 
required to consider whether the technology to be supported by the 
award is likely to be manufactured in the United States.
    Section 5127 of the Reauthorization Act established the Phase 0 
Proof of Concept Partnership Pilot Program, which terminates on 
September 30, 2017, unless otherwise extended. Section 5127 of the 
Reauthorization Act authorizes the Director of the National Institutes 
of Health (NIH) to use $5,000,000 of the funds allocated for the STTR 
Program, set forth in section 2(b) of this directive, to establish this 
pilot program to accelerate the creation of small businesses and the 
commercialization of research innovations from qualifying institutions. 
The Director of NIH may make grant awards of up to $1,000,000 per year, 
for up to 3 years, to qualifying institutions. Awards shall be made 
based on a competitive, merit-based process. Section 5127 provides 
criteria that the Director of NIH must consider in determining whether 
an applicant is a qualified institution. The qualifying institutions 
must use these funds to establish a Proof of Concept Partnership with 
NIH to administer grant awards to individual researchers. These grants 
should provide individual researchers with the initial investment and 
the resources to support the proof of concept work and 
commercialization mentoring necessary to translate promising research 
projects and technologies into a viable company. Section 5127 provides 
guidelines that the administrator of a Proof of Concept Partnership 
must follow in making grant awards to individual researchers. The 
administrator of a Proof of Concept Partnership must also make 
educational resources and guidance available to researchers attempting 
to commercialize innovations.
    Section 5127 of the Reauthorization Act also limits the use of the 
pilot program's funds. Specifically, section 5127 requires that the 
funds must not be used for basic research or to fund the acquisition of 
research equipment or supplies unrelated to commercialization 
activities. This section of the Reauthorization Act also specifically 
states that the pilot program's funds can be used to evaluate the 
commercial potential of existing discoveries, including proof of 
concept research or prototype development; and activities that 
contribute to determining a project's commercialization path, to 
include technical validations, market research, clarifying intellectual 
property rights, and investigating commercial and business 
opportunities.

L. Appendix--Instructions for STTR Program Solicitation Preparation

    SBA amended this section of the Policy Directive to address the 
certification requirements set forth in section 5143 of the 
Reauthorization Act. Specifically, section 5143 recommends that SBCs 
receiving an STTR award certify their eligibility for the program and 
award.
    SBA has created three new certifications to be used by agencies. 
The first certification is for STTR applicants that are majority-owned 
by multiple VCOCs, hedge funds or private equity firms. The 
certification, to be submitted to the agency by the SBC with its 
application, states that the SBC has registered with the Company 
Registry Database and meets the statutory requirements for eligibility 
of such small businesses.
    The second certification is required for all SBCs that receive an 
STTR award, although agencies may request that SBCs provide a 
certification at the time

[[Page 46865]]

of application, as well. This certification addresses the ownership and 
control requirements for the program set forth in SBA's regulations and 
the performance of work requirements for the small business and 
principal investigator. The certification also addresses whether all or 
a portion of the work under the project has been submitted to another 
agency for consideration of an award and whether the other agency has 
or has not funded the work. The purpose of this part of the 
certification is to ensure that two or more agencies do not fund the 
same or similar work.
    The third certification is required for all STTR awardees that are 
working on an STTR award. This is referred to as the life cycle 
certification. It seeks to ensure that once awarded the STTR funding 
agreement, the small business concern continues to meet the program's 
requirements (e.g. performing the required percentage of work, 
employing the principal investigator). Agencies will set forth in the 
funding agreement those specific points in time that the small business 
must submit the certification during the life of the award.
    Finally, this section of the directive also addresses the 
requirement in section 5140 of the Reauthorization Act that agencies 
request permission from SBCs to disclose the title and abstract of the 
proposed project, as well as the name and other information of the 
corporate official of the SBC, to appropriate local and state economic 
development organizations, if the proposal does not result in an STTR 
award. Every applicant must include this information in its proposal 
cover sheet.

M. Other Appendices

    The remaining appendices generally set forth the data fields that 
will be used to collect the information from SBCs and agencies for the 
various databases. This information collection is further addressed in 
SBA's Paperwork Reduction Act submission.

IV. Request for Comments

    SBA was required by the Reauthorization Act to publish the final 
directive within a short timeframe. As a result, SBA was unable to 
gather public input prior to drafting these provisions, although SBA 
did work with the various STTR participating agencies to gather input 
and feedback on these provisions. SBA therefore requests comments on 
all matters addressed relating to implementation of the Reauthorization 
Act. SBA will review and consider all comments received to determine 
whether amendments are needed to improve the general conduct of the 
STTR Program.

Notice of Final Policy Directive; Small Business Technology Transfer 
Program

To: The Small Business Technology Transfer Program Managers
Subject: SBIR/STTR Reauthorization Act of 2011 (Reauthorization Act)--
Amendments to the Small Business Technology Transfer Program
    1. Purpose. The purpose of this notice is to set forth a final STTR 
Policy Directive, which incorporates recent amendments made to the 
Small Business Act by the SBIR/STTR Reauthorization Act of 2011.
    2. Authority. Section 9(p) of the Small Business Act (15 U.S.C. 
638(p)) requires the Administrator of the U.S. Small Business 
Administration (SBA) to issue an STTR Program Policy Directive for the 
general conduct of the STTR Program. Further, section 5151 of the 
Reauthorization Act requires the SBA to issue a final directive, 
incorporating the Reauthorization Act's amendments within 180 days 
after its enactment.
    3. Procurement Regulations. It is recognized that the Federal 
Acquisition Regulations and agency supplemental regulations may need to 
be modified to conform to the requirements of the final Policy 
Directive. SBA's Administrator or designee must review and concur with 
any regulatory provisions that pertain to areas of SBA responsibility. 
SBA's Office of Technology coordinates such regulatory actions.
    4. Personnel Concerned. This Policy Directive serves as guidance 
for all federal government personnel who are involved in the 
administration of the STTR Program, issuance and management of Funding 
Agreements or contracts pursuant to the STTR Program, and the 
establishment of goals for small business concerns in research or 
research and development acquisition or grants.
    5. Originator. SBA's Office of Technology.
    6. Date. The policy directive is effective on the date of 
publication in the Federal Register. Agencies are not required to, but 
can amend, an STTR solicitation that was issued on or before the date 
of this Policy Directive to address these new requirements. Further, 
public comment may be submitted for 60 days following publication in 
the Federal Register.

    Authorized by:
Sean Greene,
Associate Administrator for the Office of Investment and Innovation 
Small Business Administration.
    Dated: July 19, 2012.
Karen G. Mills,
Administrator.

1. Purpose
2. Summary of Statutory Provisions
3. Definitions
4. Competitively Phased Structure of the Program
5. Program Solicitation Process
6. Eligibility and Application (Proposal) Requirements
7. STTR Funding Process
8. Terms of Agreement for STTR Awards
9. Responsibilities of STTR Participating Agencies and Departments
10. Agency and STTR Applicant/Awardee Reporting Requirements
11. Responsibilities of SBA
12. Supporting Programs and Initiatives
Appendix I: Instructions for STTR Program Solicitation Preparation
Appendix II: Codes for Tech-Net Database
Appendix III: Solicitations Database
Appendix IV: Company Registry Database
Appendix V: Application Information Database
Appendix VI: Award Information Database
Appendix VII: Commercialization Database
Appendix VIII: Annual Report Database
Appendix IX: Performance Areas, Metrics and Goals
Appendix X: National Academy of Sciences Study

1. Purpose

    (a) Section 9(p) of the Small Business Act (Act) requires that the 
Small Business Administration (SBA) issue an STTR Program Policy 
Directive for the general conduct of the STTR Program within the 
Federal Government.
    (b) This Policy Directive fulfills SBA's statutory obligation to 
provide guidance to the participating Federal agencies for the general 
operation of the STTR Program. Additional or modified instructions may 
be issued by the SBA as a result of public comment or experience. With 
this directive, SBA fulfills the statutory requirement to simplify and 
standardize the program proposal, selection, contracting, compliance, 
and audit procedures for the STTR program to the extent practicable, 
while allowing the STTR agencies flexibility in the operation of their 
individual STTR Program. Wherever possible, SBA has attempted to reduce 
the paperwork and regulatory compliance burden on SBCs applying to and 
participating in the STTR program, while still meeting the statutory 
reporting and data collection requirements.
    (c) The statutory purpose of the STTR Program is to stimulate a 
partnership of

[[Page 46866]]

ideas and technologies between innovative small business concerns 
(SBCs) and Research Institutions through Federally-funded research or 
research and development (R/R&D). By providing awards to SBCs for 
cooperative R/R&D efforts with Research Institutions, the STTR Program 
assists the small business and research communities by commercializing 
innovative technologies.
    (d) Federal agencies participating in the STTR Program (STTR 
agencies) are obligated to follow the guidance provided by this Policy 
Directive. Each agency is required to review its rules, policies, and 
guidance on the STTR Program to ensure consistency with this Policy 
Directive and to make any necessary changes in accordance with each 
agency's normal procedures. This is consistent with the statutory 
authority provided to the SBA concerning the STTR Program.

2. Summary of Statutory Provisions

    (a) The Small Business Technology Transfer Program is codified at 
section 9 of the Small Business Act, 15 U.S.C. Sec.  638. The STTR 
Program is authorized until September 30, 2017, or as otherwise 
provided in law subsequent to that date.
    (b) Each Federal agency with an extramural budget for R/R&D in 
excess of $1,000,000,000 must participate in the STTR Program and 
reserve the following minimum percentages of their R/R&D budgets for 
awards to small business concerns for R/R&D:
    (1) Not less than 0.3% of such budget in each of fiscal years 2004 
through 2011;
    (2) not less than 0.35% of such budget in fiscal years 2012 and 
2013;
    (3) not less than 0.40% of such budget in fiscal years 2014 and 
2015; and
    (4) not less than 0.45% of such budget in fiscal year 2016 and each 
fiscal year after.

A Federal agency may exceed these minimum percentages.

    (c) In general, each STTR agency must make these awards for R/R&D 
through the following uniform, three-phase process:
    (1) Phase I awards to determine, insofar as possible, the 
scientific and technical merit and feasibility of ideas that appear to 
have commercial potential.
    (2) Phase II awards to further develop work from Phase I that meets 
particular program needs and exhibits potential for commercial 
application.
    (3) Phase III awards where commercial applications of STTR-funded 
R/R&D are funded by non-Federal sources of capital; or where products, 
services or further research intended for use by the Federal Government 
are funded by follow-on non-STTR Federal Funding Agreements.
    (d) STTR agencies must report to SBA on the calculation of the 
agency's extramural budget within four months of enactment of each 
agency's annual Appropriations Act.
    (e) The Act explains that agencies are authorized and directed to 
cooperate with SBA in order to carry out and accomplish the purpose of 
the STTR Program. As a result, each STTR agency shall provide 
information to SBA in order for SBA to monitor and analyze each 
agency's STTR Program and to report these findings annually to the 
Senate Committee on Small Business and Entrepreneurship and to the 
House Committees on Science and Small Business. For more information on 
the agency's reporting requirements, including the frequency for 
specific reporting requirements, see section 10 of the Policy 
Directive.
    (f) SBA establishes databases to collect and maintain, in a common 
format, information that is necessary to assist SBCs and assess the 
STTR Program.
    (g) SBA implements the Federal and State Technology (FAST) 
Partnership Program to strengthen the technological competitiveness of 
SBCs, to the extent that FAST is authorized by law.
    (h) The competition requirements of the Armed Services Procurement 
Act of 1947 (10 U.S.C. 2302 et seq.) and the Federal Property and 
Administrative Services Act of 1949 (41 U.S.C. 3101 et seq.) must be 
read in conjunction with the procurement notice publication 
requirements of section 8(e) of the Small Business Act (15 U.S.C. Sec.  
637(e)). The following notice publication requirements of section 8(e) 
of the Small Business Act apply to STTR agencies using contracts as an 
STTR funding agreement:
    (1) Any Federal executive agency intending to solicit a proposal to 
award a Phase I contract for property or services valued above $25,000 
must transmit a notice of the impending solicitation to the 
Governmentwide point of entry (GPE) for access by interested sources. 
See FAR 5.201. The GPE, located at https://www.fbo.gov, is the single 
point where Government business opportunities greater than $25,000, 
including synopses of proposed contract actions, solicitations, and 
associated information, can be accessed electronically by the public. 
In addition, an agency may not issue its solicitation for at least 15 
days from the date of the publication of the GPE. The agency may not 
establish a deadline for submission of proposals in response to a 
solicitation earlier than 30 days after the date on which the 
solicitation was issued.
    (2) The contracting officer must generally make available through 
the GPE those solicitations synopsized through the GPE, including 
specifications and other pertinent information determined necessary by 
the contracting officer. See FAR 5.102.
    (3) Any executive agency awarding a contract for property or 
services valued at more than $25,000 must submit a synopsis of the 
award through the GPE if a subcontract is likely to result from such 
contract. See FAR 5.301.
    (4) The following are exemptions from the notice publication 
requirements:
    (i) In the case of agencies intending to solicit Phase I proposals 
for contracts in excess of $25,000, the head of the agency may exempt a 
particular solicitation from the notice publication requirements if 
that official makes a written determination, after consulting with the 
Administrator of the Office of Federal Procurement Policy and the SBA 
Administrator, that it is inappropriate or unreasonable to publish a 
notice before issuing a solicitation.
    (ii) The STTR Phase II award process.
    (iii) The STTR Phase III award process.

3. Definitions

    (a) Act. The Small Business Act (15 U.S.C. 631 et seq.), as 
amended.
    (b) Applicant. The organizational entity that qualifies as an SBC 
at all pertinent times and that submits a contract proposal or a grant 
application for a funding agreement under the STTR Program.
    (c) Affiliate. This term has the same meaning as set forth in 13 
CFR part 121--Small Business Size Regulations, Sec.  121.103, What is 
affiliation? (available at http://ecfr.gpoaccess.gov/cgi/t/text/text-idx?c=ecfr;sid=03878acee7c064a02cac0d870e00ef43;rgn=div6;view=text;node=
13%3A1.0.1.1.17.1;idno=13;cc=ecfr). Further information about SBA's 
affiliation rules and a guide on affiliation is available at 
www.SBIR.gov and www.SBA.gov/size.
    (d) Alaska Native-Serving Institution (ANSI). As defined by 20 
U.S.C. 1059d, it is an institution of higher education that is an 
eligible institution that at the time of application, has an enrollment 
of undergraduate students that is at least 20 percent Alaska Native 
students;
    (e) Awardee. The organizational entity receiving an STTR Phase I, 
Phase II, or Phase III award.

[[Page 46867]]

    (f) Commercialization. The process of developing products, 
processes, technologies, or services and the production and delivery 
(whether by the originating party or others) of the products, 
processes, technologies, or services for sale to or use by the Federal 
government or commercial markets.
    (g) Cooperative Agreement. A financial assistance mechanism used 
when substantial Federal programmatic involvement with the awardee 
during performance is anticipated by the issuing agency. The 
Cooperative Agreement contains the responsibilities and respective 
obligations of the parties.
    (h) Essentially Equivalent Work. Work that is substantially the 
same research, which is proposed for funding in more than one contract 
proposal or grant application submitted to the same Federal agency or 
submitted to two or more different Federal agencies for review and 
funding consideration; work where a specific research objective and the 
research design for accomplishing the objective are the same or closely 
related to another proposal or award, regardless of the funding source.
    (i) Extramural Budget. The sum of the total obligations for R/R&D 
minus amounts obligated for R/R&D activities by employees of a Federal 
agency in or through Government-owned, Government-operated facilities. 
For the Agency for International Development, the ``extramural budget'' 
must not include amounts obligated solely for general institutional 
support of international research centers or for grants to foreign 
countries. For the Department of Energy, the ``extramural budget'' must 
not include amounts obligated for atomic energy defense programs solely 
for weapons activities or for naval reactor programs. (Also see section 
7(i) of this Policy Directive for additional exemptions related to 
national security.)
    (j) Feasibility. The practical extent to which a project can be 
performed successfully.
    (k) Federal Agency. An executive agency as defined in 5 U.S.C. 
Sec.  105, and a military department as defined in 5 U.S.C. 102 
(Department of the Army, Department of the Navy, Department of the Air 
Force), except that it does not include any agency within the 
Intelligence Community as defined in Executive Order 12333, Sec.  
3.4(f), or its successor orders.
    (l) Federal Laboratory. As defined in 15 U.S.C. 3703, means any 
laboratory, any federally funded research and development center, or 
any center established under 15 U.S.C. 3705 & 3707 that is owned, 
leased, or otherwise used by a Federal agency and funded by the Federal 
Government, whether operated by the Government or by a contractor.
    (m) Funding Agreement. Any contract, grant, or cooperative 
agreement entered into between any Federal agency and any SBC for the 
performance of experimental, developmental, or research work, including 
products or services, funded in whole or in part by the Federal 
Government.
    (n) Funding Agreement Officer. A contracting officer, a grants 
officer, or a cooperative agreement officer.
    (o) Grant. A financial assistance mechanism providing money, 
property, or both to an eligible entity to carry out an approved 
project or activity. A grant is used whenever the Federal agency 
anticipates no substantial programmatic involvement with the awardee 
during performance.
    (p) Hispanic-Serving Institutions (HSI). Pursuant to 20 U.S.C. 
1101(5), a non-profit institution that has at least 25% Hispanic full-
time equivalent (FTE) enrollment, and of the Hispanic student 
enrollment at least 50% are low income.
    (q) Historically Black College or University (HBCU). Pursuant to 20 
U.S.C. 1061(2), a black college or university that was established 
prior to 1964, whose principle mission was, and is, the education of 
Black Americans, and that is accredited by a nationally recognized 
agency or association determined by the Secretary of Education to be a 
reliable authority as to the quality of training offered or is, 
according to such an agency or association is making reasonable 
progress toward accreditation, with certain exceptions noted in 
statute.
    (r) Innovation. Something new or improved, having marketable 
potential, including: (1) Development of new technologies; (2) 
refinement of existing technologies; or (3) development of new 
applications for existing technologies.
    (s) Intellectual Property. The separate and distinct types of 
intangible property that are referred to collectively as ``intellectual 
property,'' including but not limited to: (1) Patents; (2) trademarks; 
(3) copyrights; (4) trade secrets; (5) STTR technical data (as defined 
in this section); (6) ideas; (7) designs; (8) know-how; (9) business; 
(10) technical and research methods; (11) other types of intangible 
business assets; (12) and all types of intangible assets either 
proposed or generated by an SBC as a result of its participation in the 
STTR Program.
    (t) Key Individual. The principal investigator/project manager and 
any other person named as a ``key'' employee in a proposal submitted in 
response to a program solicitation.
    (u) Joint Venture. See 13 CFR 121.103(h).
    (v) Native Hawaiian-Serving Institutions (NHSI). Pursuant to 20 
U.S.C. 1059(d) is an institution of higher education which is an 
eligible institution under 20 U.S.C. 1058(b) at the time of 
application, and has an enrollment of undergraduate students that is at 
least 10 percent Native Hawaiian students.
    (w) Principal Investigator/Project Manager. The one individual 
designated by the applicant to provide the scientific and technical 
direction to a project supported by the funding agreement.
    (x) Program Solicitation. A formal solicitation for proposals 
issued by a Federal agency that notifies the small business community 
of its R/R&D needs and interests in broad and selected areas, as 
appropriate to the agency, and requests proposals from SBCs in response 
to these needs and interests. Announcements in the Federal Register or 
the GPE are not considered an STTR Program solicitation.
    (y) Prototype. A model of something to be further developed, which 
includes designs, protocols, questionnaires, software, and devices.
    (z) Research or Research and Development (R/R&D). Any activity that 
is:
    (1) A systematic, intensive study directed toward greater knowledge 
or understanding of the subject studied;
    (2) A systematic study directed specifically toward applying new 
knowledge to meet a recognized need; or
    (3) A systematic application of knowledge toward the production of 
useful materials, devices, and systems or methods, including design, 
development, and improvement of prototypes and new processes to meet 
specific requirements.
    (aa) Research Institution. One that has a place of business located 
in the United States, which operates primarily within the United States 
or which makes a significant contribution to the U.S. economy through 
payment of taxes or use of American products, materials or labor, and 
is:
    (1) A non-profit institution as defined in section 4(5) of the 
Stevenson-Wydler Technology Innovation Act of 1980 (that is, an 
organization that is owned and operated exclusively for scientific or 
educational purposes, no part of the net earnings of which inures to 
the benefit of any private shareholder or individual) and includes non-
profit medical and surgical hospitals; or

[[Page 46868]]

    (2) A Federally-funded R&D center as identified by the National 
Science Foundation in accordance with the Government-wide Federal 
Acquisition Regulation issued in accordance with section 35(c)(1) of 
the Office of Federal Procurement Policy Act (or any successor 
regulation thereto).
    (bb) Small Business Concern. A concern that meets the requirements 
set forth in 13 CFR 121.702 (available at http://ecfr.gpoaccess.gov/cgi/t/text/text-idx?c=ecfr;sid=03878acee7c064a02cac0d870e00ef43;rgn=div8;view=text;node=
13%3A1.0.1.1.17.1.273.45;idno=13;cc=ecfr).
    (cc) Socially and Economically Disadvantaged SBC (SDB). See 13 CFR 
part 124, Subpart B.
    (dd) Socially and Economically Disadvantaged Individual. See 13 CFR 
124.103 & 121.104.
    (ee) STTR Participants. Business concerns that have received STTR 
awards or that have submitted STTR proposals/applications.
    (ff) STTR Technical Data. All data generated during the performance 
of an STTR award.
    (gg) STTR Technical Data Rights. The rights an STTR awardee obtains 
in data generated during the performance of any STTR Phase I, Phase II, 
or Phase III award that an awardee delivers to the Government during or 
upon completion of a Federally-funded project, and to which the 
Government receives a license.
    (hh) Subcontract. Any agreement, other than one involving an 
employer employee relationship, entered into by an awardee of a funding 
agreement calling for supplies or services for the performance of the 
original funding agreement.
    (ii) Tribal-Serving Institution (TSI). Those institutions defined 
under section 532 of the Equity in Educational Land-Grants Status Act 
of 1994 (7 U.S.C. 301 note), any other institution that qualified for 
funding under the Tribally Controlled Community College Assistance Act 
of 1978, (25 U.S.C. 1801 et seq.) which is also known as tribally 
controlled colleges or universities and the Navajo Community College 
Assistance Act of 1978, Public Law 95-471, Title II (25 U.S.C. 640a 
note).
    (jj) United States. Means the 50 states, the territories and 
possessions of the Federal Government, the Commonwealth of Puerto Rico, 
the District of Columbia, the Republic of the Marshall Islands, the 
Federated States of Micronesia, and the Republic of Palau.
    (kk) Women-Owned SBC (WOSB). An SBC that is at least 51% owned by 
one or more women, or in the case of any publicly owned business, at 
least 51% of the stock is owned by women, and women control the 
management and daily business operations.

4. Competitively Phased Structure of the Program

    The STTR Program is a phased process, uniform throughout the 
Federal Government, of soliciting proposals and awarding funding 
agreements for R/R&D, production, services, or any combination, to meet 
stated agency needs or missions. Agencies must issue STTR awards 
pursuant to competitive and merit-based selection procedures. Agencies 
may not use investment of venture capital or investment from hedge 
funds or private equity firms as a criterion for an STTR award. 
Although matching funds are not required for Phase I or Phase II 
awards, agencies may require a small business to have matching funds 
for certain special awards (e.g., to reduce the gap between a Phase II 
and Phase III award). In order to stimulate and foster scientific and 
technological innovation, including increasing commercialization of 
Federal R/R&D, the program must follow a uniform competitive process of 
the following three phases, unless an exception applies:
    (a) Phase I. Phase I involves a solicitation of contract proposals 
or grant applications to conduct feasibility-related experimental or 
theoretical R/R&D related to described agency requirements. These 
requirements, as defined by agency topics contained in a solicitation, 
may be general or narrow in scope, depending on the needs of the 
agency. The object of this phase is to determine the scientific and 
technical merit and feasibility of the proposed effort and the quality 
of performance of the SBC with a relatively small agency investment 
before consideration of further Federal support in Phase II.
    (l) Several different proposed solutions to a given problem may be 
funded.
    (2) Proposals will be evaluated on a competitive basis. Agency 
criteria used to evaluate STTR proposals must give consideration to the 
scientific and technical merit and feasibility of the proposal along 
with its potential for commercialization. Considerations may also 
include program balance with respect to market or technological risk or 
critical agency requirements.
    (3) Agency benchmarks for progress towards commercialization. 
Agencies must determine whether an applicant has met the agency's 
benchmark requirements for progress towards commercialization. For 
Phase I eligibility purposes, agencies will establish a threshold for 
the application of these benchmarks where they are applied only to 
Phase I applicants that have received more than 20 Phase I awards over 
the prior 5, 10 or 15 fiscal years (excluding the most recently 
completed fiscal year) or has received more than 15 Phase II awards 
over that period (excluding the most recently completed two fiscal 
years). Agencies must base these benchmarks on the SBC's STTR awards 
across all STTR agencies.
    (i) Agencies must apply two benchmark rates addressing an 
applicant's progress towards commercialization--the Phase I-Phase II 
Transition Rate and the Commercialization Rate.
    (A) The Phase I-Phase II Transition Rate benchmark sets the minimum 
required number of Phase II awards the applicant must have received for 
a given number of Phase I awards during a specified period.
    (B) The Commercialization Rate benchmark sets the minimum Phase III 
commercialization results a Phase I applicant must have realized from 
its prior Phase II awards.
    (ii) An applicant that does not meet either of these benchmarks at 
the time it submits its application to the agency is not eligible for 
that particular STTR Phase I award and any other new STTR Phase I 
awards (and any Phase II awards issued pursuant to paragraph (b)(1)(ii) 
below) of that agency for a period of one year from the date of the 
proposal or application submission. The agency must provide written 
notification of its determination and the one year restriction on Phase 
I awards to the applicant and to SBA. See section 9(b) for further 
information about how an agency establishes these benchmarks.
    (iii) Establishing the Phase I-Phase II Transition Rate. Beginning 
October 1, 2012, each agency must establish an SBA-approved Phase I-
Phase II Transition Rate benchmark. The agency must report any 
subsequent change in the benchmark rate to SBA for approval.
    (A) The benchmark will establish the number of Phase II awards a 
small business concern must have received for a given number of Phase I 
awards over the prior 5, 10, or 15 fiscal years, excluding the most 
recently completed fiscal year. For example, if a SBC submits its 
application on January 2012, the agency may require that the SBC have 
received at least one Phase II award for every 10 Phase I awards it 
received during fiscal years 2001 through 2010.
    (B) Agencies must set the benchmark as appropriate for their 
programs and industry sectors. When setting this benchmark, agencies 
should consider

[[Page 46869]]

that Phase I is designed and intended to explore high-risk, early-stage 
research and, as a result, a significant share of Phase I awards will 
not result in a Phase II award.
    (iv) Establishing the Commercialization Rate. Beginning October 1, 
2013, each agency must establish an SBA-approved Commercialization Rate 
benchmark that establishes the level of Phase III commercialization 
results a SBC must have received from work it performed under prior 
Phase II awards, over the prior 5, 10 or 15 fiscal years, excluding the 
most recently completed two fiscal years. The agency must report any 
subsequent change in the benchmark rate to SBA for approval. Agencies 
may define this benchmark:
    (A) In financial terms, such as by using the ratio of the dollar 
value of revenues and additional investment resulting from prior Phase 
II awards relative to the dollar value of the Phase II awards received 
over the prior 5, 10 or 15 fiscal years, excluding the most recently 
completed two fiscal years; or
    (B) In terms of the share of Phase II awards that have resulted in 
the introduction of a product to the market relative to the number of 
Phase II awards received over the prior 5, 10, or 15 fiscal years, 
excluding the most recently completed two fiscal years; or
    (C) By other means such as using a commercialization scoring system 
that rates awardees on their past commercialization success.
    (v) Agencies must submit these benchmarks to SBA for approval. SBA 
will publish the benchmark and seek public comment. The benchmark will 
become effective when SBA publishes the final, approved benchmark on 
www.SBIR.gov. If SBA approves a benchmark for a fiscal year, then the 
agency must report any subsequent change in the benchmark to SBA for 
approval.
    (vi) SBA will maintain a system that records all Phase I and Phase 
II awards and calculates the Phase I-II Transition Rates for all Phase 
I awardees and the Commercialization Rates for all Phase II awardees. 
The small business will then be required to provide this information to 
the agency as part of its application.
    (vii) If the applicant meets these benchmarks, the agency must 
still evaluate the commercial potential of the specific application and 
can base this evaluation on agency-specific criteria.
    (4) Agencies may require the submission of a Phase II proposal as a 
deliverable item under Phase I.
    (b) Phase II.
    (1) The object of Phase II is to continue the R/R&D effort from the 
completed Phase I. Unless the exception set forth in paragraph (i) 
applies, only STTR Phase I awardees are eligible to participate in 
Phases II and III. This includes those awardees identified via a 
``novated'' or ``successor in interest'' or similarly-revised funding 
agreement, or those that have reorganized with the same key staff, 
regardless of whether they have been assigned a different tax 
identification number. Agencies may require the original awardee to 
relinquish its rights and interests in an STTR project in favor of 
another applicant as a condition for that applicant's eligibility to 
participate in the STTR Program for that project.
    (i) A Federal agency may issue an STTR Phase II award to an SBIR 
Phase I awardee to further develop the work performed under the SBIR 
Phase I award. The agency must base its decision upon the results of 
work performed under the Phase I award and the scientific and technical 
merit, and commercial potential of the Phase II proposal. The SBIR 
Phase I awardee must meet the eligibility and program requirements of 
the STTR Program in order to receive the STTR Phase II award.
    (2) Funding must be based upon the results of work performed under 
a Phase I award and the scientific and technical merit, feasibility and 
commercial potential of the Phase II proposal. Phase II awards may not 
necessarily complete the total research and development that may be 
required to satisfy commercial or Federal needs beyond the STTR 
Program. The Phase II funding agreement with the awardee may, at the 
discretion of the awarding agency, establish the procedures applicable 
to Phase III agreements. The Government is not obligated to fund any 
specific Phase II proposal.
    (3) The STTR Phase II award decision process requires, among other 
things, consideration of a proposal's commercial potential. Commercial 
potential includes the potential to transition the technology to 
private sector applications, Government applications, or Government 
contractor applications. Commercial potential in a Phase II proposal 
may be evidenced by:
    (i) The SBC's record of successfully commercializing STTR or other 
research;
    (ii) The existence of Phase II funding commitments from private 
sector or other non-STTR funding sources;
    (iii) The existence of Phase III, follow-on commitments for the 
subject of the research; and
    (iv) Other indicators of commercial potential of the idea.
    (4) Agencies may not use an invitation, pre-screening, or pre-
selection process for eligibility for Phase II. Agencies must note in 
each solicitation that all Phase I awardees may apply for a Phase II 
award and provide guidance on the procedure for doing so.
    (5) A Phase II awardee may receive one additional, sequential Phase 
II award to continue the work of an initial Phase II award.
    (6) Agencies may issue Phase II awards for testing and evaluation 
of products, services, or technologies for use in technical weapons 
systems.
    (c) Phase III. STTR Phase III refers to work that derives from, 
extends, or completes an effort made under prior STTR funding 
agreements, but is funded by sources other than the STTR Program. Phase 
III work is typically oriented towards commercialization of STTR 
research or technology.
    (l) Each of the following types of activity constitutes STTR Phase 
III work:
    (i) Commercial application (including testing and evaluation of 
products, services or technologies for use in technical or weapons 
systems) of STTR-funded R/R&D financed by non-Federal sources of 
capital (Note: The guidance in this Policy Directive regarding STTR 
Phase III pertains to the non-STTR federally-funded work described in 
(ii) and (iii) below. It does not address private agreements an STTR 
firm may make in the commercialization of its technology, except for a 
subcontract to a Federal contract that may be a Phase III);
    (ii) STTR-derived products or services intended for use by the 
Federal Government, funded by non-STTR sources of Federal funding;
    (iii) continuation of R/R&D that has been competitively selected 
using peer review or merit-based selection procedures, funded by non-
STTR Federal funding sources.
    (2) A Phase III award is, by its nature, an STTR award, has STTR 
status, and must be accorded STTR data rights. If an STTR awardee 
receives a funding agreement (whether competed, sole sourced or a 
subcontract) for work that derives from, extends, or completes efforts 
made under prior STTR funding agreements, then the funding agreement 
for the new work must have all STTR Phase III status and data rights.
    (3) The competition for STTR Phase I and Phase II awards satisfies 
any competition requirement of the Armed Services Procurement Act, the 
Federal Property and Administrative Services Act, and the Competition 
in Contracting Act. Therefore, an agency that wishes to

[[Page 46870]]

fund an STTR Phase III project is not required to conduct another 
competition in order to satisfy those statutory provisions. As a 
result, in conducting actions relative to a Phase III STTR award, it is 
sufficient to state for purposes of a Justification and Approval 
pursuant to FAR 6.302-5, that the project is an STTR Phase III award 
that is derived from, extends, or completes efforts performed under 
prior STTR funding agreements and is authorized under 10 U.S.C. 
2304(b)(2) or 41 U.S.C. 3303(b).
    (4) Phase III work may be for products, production, services, R/
R&D, or any combination thereof.
    (5) There is no limit on the number, duration, type, or dollar 
value of Phase III awards made to a business concern. There is no limit 
on the time that may elapse between a Phase I or Phase II award and 
Phase III award, or between a Phase III award and any subsequent Phase 
III award. A Federal agency may enter into a Phase III STTR agreement 
at any time with a Phase II awardee. Similarly, a Federal agency may 
enter into a Phase III STTR agreement at any time with a Phase I 
awardee. A subcontract to a Federally-funded prime contract may be a 
Phase III award.
    (6) The small business size limits for Phase I and Phase II awards 
do not apply to Phase III awards.
    (7) To the greatest extent practicable, agencies or their 
Government-owned, contractor-operated facilities, Federally-funded 
research and development centers, or Government prime contractors that 
pursue R/R&D or production developed under the STTR Program, shall 
issue Phase III awards relating to technology, including sole source 
awards, to the STTR awardee that developed the technology. Agencies 
shall document how they provided this preference to the STTR awardee 
that developed the technology. In fact, the Act requires that SBA 
report all instances in which an agency pursues research, development, 
or production of a technology developed by an STTR awardee, with a 
business concern or entity other than the one that developed the STTR 
technology. (See section 4(c)(8) immediately below for agency 
notification to SBA prior to award of such a funding agreement and 
section 10(h)(4) regarding agency reporting of the issuance of such 
award.) SBA will report such instances, including those discovered 
independently by SBA, to Congress.
    (8) Agencies, their Government-owned, contractor-operated 
facilities, or Federally-funded research and development centers, that 
intend to pursue R/R&D, production, services or any combination thereof 
of a technology developed under an STTR award, with an entity other 
than that STTR awardee, must notify SBA in writing prior to such an 
award. This notification must include, at a minimum:
    (i) The reasons why the follow-on funding agreement with the STTR 
awardee is not practicable;
    (ii) the identity of the entity with which the agency intends to 
make an award to perform research, development, or production; and
    (iii) a description of the type of funding award under which the 
research, development, or production will be obtained. SBA may appeal 
an agency decision to pursue Phase III work with a business concern 
other than the STTR awardee that developed the technology to the head 
of the contracting activity. If SBA decides to appeal the decision, it 
must file a notice of intent to appeal with the funding agreement 
officer no later than 5 business days after receiving the agency's 
notice of intent to make award. Upon receipt of SBA's notice of intent 
to appeal, the funding agreement officer must suspend further action on 
the acquisition until the head of the contracting activity issues a 
written decision on the appeal. The funding agreement officer may 
proceed with award if he or she determines in writing that the award 
must be made to protect the public interest. The funding agreement 
officer must include a statement of the facts justifying that 
determination and provide a copy of its determination to SBA. Within 30 
days of receiving SBA's appeal, the head of the contracting activity 
must render a written decision setting forth the basis of his or her 
determination. During this period, the agency should consult with SBA 
and review any case-specific information SBA believes to be pertinent.

5. Program Solicitation Process

    (a) At least annually, each agency must issue a program 
solicitation that sets forth a substantial number of R/R&D topics and 
subtopic areas consistent with stated agency needs or missions. 
Agencies may decide to issue joint solicitations. Both the list of 
topics and the description of the topics and subtopics must be 
sufficiently comprehensive to provide a wide range of opportunities for 
SBCs to participate in the agency R&D programs. Topics and subtopics 
must emphasize the need for proposals with advanced concepts to meet 
specific agency R/R&D needs. Each topic and subtopic must describe the 
needs in sufficient detail to assist in providing on-target responses, 
but cannot involve detailed specifications to prescribed solutions of 
the problems.
    (b) The Act requires issuance of STTR Phase I Program solicitations 
in accordance with a Master Schedule coordinated between SBA and the 
STTR agency. The SBA office responsible for coordination is: Office of 
Technology, U.S. Small Business Administration, 409 Third Street SW., 
Washington, DC 20416. Phone: (202) 205-6450. Fax: (202) 205-7754. 
Email: [email protected]. Internet site: www.SBIR.gov.
    (c) For maximum participation by interested SBCs, it is important 
that the planning, scheduling and coordination of agency program 
solicitation release dates be completed as early as practicable to 
coincide with the commencement of the fiscal year on October 1. 
Bunching of agency program solicitation release and closing dates may 
prohibit SBCs from preparation and timely submission of proposals for 
more than one STTR project. SBA's coordination of agency schedules 
minimizes the bunching of proposed release and closing dates. STTR 
agencies may elect to publish multiple program solicitations within a 
given fiscal year to facilitate in-house agency proposal review and 
evaluation scheduling.
    (d) SBA will post an electronic Master Schedule of release dates of 
program solicitations with links to Internet Web sites of agency 
solicitations. For more information see section 10(g).
    (e) Simplified, Standardized, and Timely STTR Program Solicitations
    (1) The Act requires ``simplified, standardized and timely STTR 
solicitations'' and for STTR agencies to use a ``uniform process'' 
minimizing the regulatory burden for SBCs. Therefore, the instructions 
in Appendix I to this Policy Directive purposely depart from normal 
Government solicitation format and requirements.
    (2) Agencies must provide SBA's Office of Technology with an 
electronic version of each solicitation and any modifications no later 
than 5 days after the date of release of the solicitation or 
modification to the public. Agencies that issue program solicitations 
in electronic format only must provide the Internet site at which the 
program solicitation may be accessed no later than the date of posting 
at that site of the program solicitation.
    (3) SBA does not intend that the STTR Program solicitation replace 
or be used as a substitute for unsolicited proposals for R/R&D awards 
to SBCs. In addition, the STTR Program solicitation procedures do not 
prohibit other agency R/R&D actions with SBCs that are

[[Page 46871]]

carried on in accordance with applicable statutory or regulatory 
authorizations.

6. Eligibility and Application (Proposal) Requirements

    (a) Eligibility Requirements:
    (1) To receive STTR funds, each awardee of a STTR Phase I or Phase 
II award must qualify as an SBC at the time of award and at any other 
time set forth in SBA's regulations at 13 CFR 121.701-121.705. Each 
Phase I and Phase II awardee must submit a certification stating that 
it meets the size, ownership and other requirements of the STTR Program 
at the time of award, and at any other time set forth in SBA's 
regulations at 13 CFR 121.701-705.
    (2) NIH, Department of Energy and National Science Foundation may 
award not more than 25% of the agency's SBIR funds to SBCs that are 
owned in majority part by multiple venture capital operating companies, 
hedge funds, or private equity firms through competitive, merit-based 
procedures that are open to all eligible small business concerns. All 
other SBIR agencies may award not more than 15% of the agency's SBIR 
funds to such SBCs. At their discretion, if the agency has not exceeded 
these maximum statutory percentages, the agency may make STTR awards to 
small businesses that are majority-owned by multiple VCOCs, hedge funds 
or private equity firms through competitive, merit-based procedures 
that are open to all eligible small business concerns under the STTR 
Program and using STTR funds. If an agency exceeds this maximum 
statutory percentage of awards, it must transfer this excess amount 
from its non-SBIR and non-STTR funds to the SBIR funds.
    (i) Before permitting participation in the STTR program by SBCs 
that are owned in majority part by multiple venture capital operating 
companies, hedge funds, or private equity firms:
    (A) SBA's regulations at 13 CFR part 121 must set forth the 
eligibility criteria for STTR applicants that are owned in majority 
part by multiple venture capital operating companies, hedge funds, or 
private equity firms.
    (B) The STTR agency must submit a written determination at least 30 
calendar days before it begins making awards to SBCs that are owned in 
majority part by multiple venture capital operating companies, hedge 
funds, or private equity firms to SBA, the Senate Committee on Small 
Business and Entrepreneurship, the House Committee on Small Business 
and the House Committee on Science, Space, and Technology. The 
determination must be made by the head of the Federal agency or 
designee and explain how awards to SBCs that are owned in majority part 
by multiple venture capital operating companies, hedge funds, or 
private equity firms will:
    (I) Induce additional venture capital, hedge fund, or private 
equity firm funding of small business innovations;
    (II) substantially contribute to the mission of the Federal agency;
    (III) address a demonstrated need for public research; and
    (IV) otherwise fulfill the capital needs of small business concerns 
for additional financing for STTR projects.
    (ii) The SBC that is majority-owned by multiple venture capital 
operating companies, hedge funds, or private equity firms must register 
with SBA in the Company Registry Database, at www.SBIR.gov, prior to 
the date it submits an application for an STTR award.
    (iii) The SBC that is majority-owned by multiple venture capital 
operating companies, hedge funds, or private equity firms must submit a 
certification with its proposal stating, among other things, that it 
has registered with SBA.
    (iv) Any agency that makes an award under this paragraph during a 
fiscal year shall collect and submit to SBA data relating to the number 
and dollar amount of Phase I awards, Phase II awards, and any other 
category of awards by the Federal agency under the STTR program during 
that fiscal year. See section 10 of the directive for the specific 
reporting requirements.
    (3) For both Phase I and Phase II, not less than 40 percent of the 
R/R&D work must be performed by the SBC, and not less than 30 percent 
of the R/R&D work must be performed by the single, partnering Research 
Institution. Occasionally, deviations from these requirements may 
occur, and must be approved in writing by the funding agreement officer 
after consultation with the agency STTR Program Manager/Coordinator. An 
agency can measure this research or analytical effort using the total 
contract dollars or labor hours, and must explain to the small business 
in the solicitation how it will be measured.
    (4) For both Phase I and Phase II, the primary employment of the 
principal investigator must be with the SBC or the research institution 
at the time of award and during the conduct of the proposed project. 
Primary employment means that more than one-half of the principal 
investigator's time is spent in the employ of the SBC or the research 
institution. This precludes full-time employment with another 
organization aside from the SBC or the research institution. 
Occasionally, deviations from this requirement may occur, and must be 
approved in writing by the funding agreement officer after consultation 
with the agency STTR Program Manager/Coordinator. An SBC may replace 
the principal investigator on an STTR Phase I or Phase II award, 
subject to approval in writing by the funding agreement officer. For 
purposes of the STTR Program, personnel obtained through a Professional 
Employer Organization or other similar personnel leasing company may be 
considered employees of the awardee. This is consistent with SBA's size 
regulations, 13 CFR 121.106--Small Business Size Regulations.
    (5) For both Phase I and Phase II, the R/R&D work must be performed 
in the United States. However, based on a rare and unique circumstance, 
agencies may approve a particular portion of the R/R&D work to be 
performed or obtained in a country outside of the United States, for 
example, if a supply or material or other item or project requirement 
is not available in the United States. The funding agreement officer 
must approve each such specific condition in writing.
    (b) Proposal (Application) Requirements.
    (1) Registration and Certifications for Proposal and Award.
    (i) Each Phase I and Phase II applicant that is majority-owned by 
multiple venture capital operating companies, hedge funds, or private 
equity firms must register with SBA in the Company Registry Database at 
www.SBIR.gov and submit a certification with its STTR application to 
the STTR agency (see Appendix I for the required text of the 
certification).
    (ii) Each applicant must register in SBA's Company Registry 
Database (see Appendix IV) and submit a .pdf document of the 
registration with its application if the agency is otherwise unable to 
obtain this information via Tech-Net. The agency will notify the 
applicants in the STTR solicitation as to whether it must submit a .pdf 
document with the application.
    (iii) Agencies may request the STTR applicant to submit a 
certification at the time of submission of the application or offer, 
which requires the applicant to state that it intends to meet the size, 
ownership and other requirements of the STTR Program at the time of 
award of the funding agreement, if recommended for award. See Appendix 
I for the required text of the certification.

[[Page 46872]]

    (2) Commercialization Plan. A succinct commercialization plan must 
be included with each proposal for an STTR Phase II award moving toward 
commercialization. Elements of a commercialization plan will include 
the following, as applicable:
    (i) Company information: Focused objectives/core competencies; 
specialization area(s); products with significant sales; and history of 
previous Federal and non-Federal funding, regulatory experience, and 
subsequent commercialization.
    (ii) Customer and Competition: Clear description of key technology 
objectives, current competition, and advantages compared to competing 
products or services; description of hurdles to acceptance of the 
innovation.
    (iii) Market: Milestones, target dates, analyses of market size, 
and estimated market share after first year sales and after 5 years; 
explanation of plan to obtain market share.
    (iv) Intellectual Property: Patent status, technology lead, trade 
secrets or other demonstration of a plan to achieve sufficient 
protection to realize the commercialization stage and attain at least a 
temporal competitive advantage.
    (v) Financing: Plans for securing necessary funding in Phase III.
    (vi) Assistance and mentoring: Plans for securing needed technical 
or business assistance through mentoring, partnering, or through 
arrangements with state assistance programs, SBDCs, Federally-funded 
research laboratories, Manufacturing Extension Partnership centers, or 
other assistance providers.
    (3) Data Collection: Each Phase I and II applicant will be required 
to provide information in www.SBIR.gov (see Appendix IV) as well as the 
other information required by Appendices V-VI to the agency or 
www.SBIR.gov. Each SBC applying for a Phase II award is required to 
update the appropriate information in the database for any of its prior 
Phase II awards (see Appendix VI).

7. STTR Funding Process

    Because the Act requires a ``simplified, standardized funding 
process,'' specific attention must be given to the following areas of 
STTR Program administration:
    (a) Timely Receipt of Proposals. Program solicitations must 
establish proposal submission dates for Phase I and may establish 
proposal submission dates for Phase II. However, agencies may also 
negotiate mutually acceptable Phase II proposal submission dates with 
individual Phase I awardees.
    (b) Review of STTR Proposals. SBA encourages STTR agencies to use 
their routine review processes for STTR proposals whether internal or 
external evaluation is used. A more limited review process may be used 
for Phase I due to the larger number of proposals anticipated. Where 
appropriate, ``peer'' reviews external to the agency are authorized by 
the Act. SBA cautions STTR agencies that all review procedures must be 
designed to minimize any possible conflict of interest as it pertains 
to applicant proprietary data. The standardized STTR solicitation 
advises potential applicants that proposals may be subject to an 
established external review process and that the applicant may include 
company designated proprietary information in its proposal.
    (c) Selection of Awardees.
    (1) Time period for decision on proposals.
    (i) The National Institutes of Health (NIH) and the National 
Science Foundation (NSF) must issue a notice to an applicant for each 
proposal submitted stating whether it was recommended or not for an 
award no more than one year after the closing date of the solicitation. 
NIH and NSF agencies should also issue the award no more than 15 months 
after the closing date of the solicitation. Pursuant to paragraph (iii) 
below, NIH and NSF are encouraged to reduce these timeframes.
    (ii) All other agencies must issue a notice to an applicant for 
each proposal submitted stating whether it was recommended or not for 
an award no more than 90 calendar days after the closing date of the 
solicitation. Agencies should issue the award no more than 180 calendar 
days after the closing date of the solicitation.
    (iii) Agencies are encouraged to develop programs or measures to 
reduce the time periods between the close of an STTR Phase I 
solicitation/receipt of a Phase II application and notification to the 
applicant as well as issuance of the STTR Phase I and Phase II awards. 
As appropriate, agencies should adopt accelerated proposal, evaluation, 
and selection procedures designed to address the gap in funding these 
competitive awards to meet or reduce the timeframes set forth above. 
With respect to Phase II awards, SBA recognizes that Phase II 
arrangements between the agency and applicant may require more detailed 
negotiation to establish terms acceptable to both parties; however, 
agencies must not sacrifice the R/R&D momentum created under Phase I by 
engaging in unnecessarily protracted Phase II proceedings.
    (iv) Request for Waiver.
    (A) If the agency determines that it requires additional time 
between the solicitation closing date and notification of 
recommendation for award, it must submit a written request for an 
extension to SBA. The written request must specify the number of 
additional calendar days needed to issue the notice for a specific 
applicant and the reasons for the extension. If an agency believes it 
will not meet the timeframes for an entire solicitation, the request 
for an extension must state how many awards will not meet the statutory 
timeframes, as well as the number of additional calendar days needed to 
issue the notice and the reasons for the extension. The written request 
must be submitted to the SBA at least 10 business days prior to when 
the agency must issue its notice to the applicant. Agencies must send 
their written request to: Office of Technology, U.S. Small Business 
Administration, 409 Third Street SW., Washington, DC 20416. Phone: 
(202) 205-6450. Fax: (202) 205-7754. Email: [email protected].
    (B) SBA will respond to the request for an extension within 5 
business days, as practicable. SBA may authorize an agency to issue the 
notice up to 90 calendar days after the timeframes set forth in 
paragraphs (c)(1)(i) and (ii).
    (C) Even if SBA grants an extension of time, the STTR agency is 
required to develop programs or measures to reduce the timeframe 
between the close of an SBIR Phase I solicitation/receipt of a Phase II 
application and notification to the applicant as well as the time to 
the issuance of the Phase I and Phase II awards as set forth in 
paragraph (c)(1)(3) above.
    (D) If an STTR agency does not receive an extension of time, it may 
still proceed with the award to the small business.
    (2) Standardized solicitation.
    (i) The standardized STTR Program solicitation must advise Phase I 
applicants that additional information may be requested by the awarding 
agency to evidence applicant responsibility for project completion and 
advise applicants of the proposal evaluation criteria for Phase I and 
Phase II.
    (ii) The STTR agency will provide information to each Phase I 
awardee considered for a Phase II award regarding Phase II proposal 
submissions, reviews, and selections.
    (d) Essentially Equivalent Work. STTR participants often submit 
duplicate or similar proposals to more than one soliciting agency when 
the work projects appear to involve similar topics or requirements, 
which are within the expertise and capability levels of the applicant. 
However, ``essentially equivalent work'' must not be funded in

[[Page 46873]]

the STTR or other Federal programs, unless an exception to this rule 
applies. Agencies must verify with the applicant that this is the case 
by requiring them to certify at the time of award and during the 
lifecycle of the award that essentially equivalent work has not been 
funded by another Federal agency.
    (e) Management of the STTR Project. The SBC, and not the single, 
partnering Research Institution, is to provide satisfactory evidence 
that it will exercise management direction and control of the 
performance of the STTR funding agreement. Regardless of the proportion 
of the work or funding allocated to each of the performers under the 
funding agreement, the SBC is to be the primary party with overall 
responsibility for performance of the project. All agreements between 
the SBC and the Research Institution cooperating in the STTR funding 
agreement, or any business plans reflecting agreements and 
responsibilities between the parties during performance of STTR Phase I 
or Phase II funding agreement, or for the commercialization of the 
resulting technology, should reflect the controlling position of the 
SBC.
    (f) Cost Sharing. Cost sharing can serve the mutual interests of 
the STTR agencies and certain STTR awardees by assuring the efficient 
use of available resources. However, cost sharing on STTR projects is 
not required, although it may be encouraged. Therefore, cost sharing 
cannot be an evaluation factor in the review of proposals. The 
standardized STTR Program solicitation (Appendix I) will provide 
information to prospective STTR applicants concerning cost sharing.
    (g) Payment Schedules and Cost Principles.
    (1) STTR awardees may be paid under an applicable, authorized 
progress payment procedure or in accordance with a negotiated/
definitive price and payment schedule. Advance payments are optional 
and may be made under appropriate law. In all cases, agencies must make 
payment to recipients under STTR funding agreements in full, subject to 
audit, on or before the last day of the 12-month period beginning on 
the date of completion of the funding agreement requirements.
    (2) All STTR funding agreements must use, as appropriate, current 
cost principles and procedures authorized for use by the STTR agencies. 
At the time of award, agencies must inform each STTR awardee, to the 
extent possible, of the applicable Federal regulations and procedures 
that refer to the costs that, generally, are allowable under funding 
agreements.
    (3) Agencies must, to the extent possible, attempt to shorten the 
amount of time between the notice of an award under the STTR Program 
and the subsequent release of funding with respect to the award.
    (h) Funding Agreement Types and Fee or Profit. Statutory 
requirements for uniformity and standardization require consistency in 
application of STTR Program provisions among STTR agencies. However, 
consistency must allow for flexibility by the various agencies in 
missions and needs as well as the wide variance in funds required to be 
devoted to STTR Programs in the agencies. The following instructions 
meet all of these requirements:
    (1) Funding Agreement. The type of funding agreement (contract, 
grant, or cooperative agreement) is determined by the awarding agency, 
but must be consistent with 31 U.S.C. 6301-6308. Contracting agencies 
may issue STTR awards as fixed price contracts (including firm fixed 
price, fixed price incentive or fixed price level of effort contracts) 
or cost type contracts, consistent with the Federal Acquisition 
Regulations and agency supplemental acquisition regulations. In some 
cases, small businesses seek progress payments, which may be 
appropriate under fixed-price R&D contracts and are a form of contract 
financing for firm-fixed-price contracts. However, for certain 
agencies, in order to qualify for progress payments or an incentive 
type contract, the small business's accounting system would have to be 
audited, which can delay award, unless the contractor has an already 
approved accounting system. Therefore STTR agencies should consider 
using partial payments methods or on a deliverable item basis or 
consider other available options to work with the STTR awardee.
    (2) Fee or Profit. Except as expressly excluded or limited by 
statute, awarding agencies must provide for a reasonable fee or profit 
on STTR funding agreements, consistent with normal profit margins 
provided to profit-making firms for R/R&D work.
    (i) Periods of Performance and Extensions.
    (1) In keeping with the legislative intent to make a large number 
of relatively small awards, modification of funding agreements to 
extend periods of performance, to increase the scope of work, or to 
increase the dollar amount should be kept to a minimum, except for 
options in original Phase I or II awards.
    (2) Phase I. Period of performance normally should not exceed 1 
year. However, agencies may provide a longer performance period where 
appropriate for a particular project.
    (3) Phase II. Period of performance under Phase II is a subject of 
negotiation between the awardee and the issuing agency. The duration of 
Phase II normally should not exceed 2 years. However, agencies may 
provide a longer performance period where appropriate for a particular 
project.
    (j) Dollar Value of Awards.
    (1) Generally, a Phase I award (including modifications) may not 
exceed $150,000 and a Phase II award (including modifications) may not 
exceed $1,000,000. Agencies may issue an award that exceeds the award 
guideline amounts by no more than 50%.
    (2) SBA will adjust these amounts every year for inflation and will 
post these inflation adjustments at the end of the fiscal year or soon 
after on www.SBIR.gov. The adjusted guidelines are effective for all 
solicitations issued on or after the date of the adjustment and may be 
used by agencies to amend the solicitation and other program 
literature. Agencies have the discretion to issue awards for less than 
the guidelines.
    (3) There is no dollar limit associated with Phase III STTR awards.
    (4) Agencies may request a waiver to exceed the award guideline 
amounts established in paragraph (j)(1) by more than 50% for a specific 
topic.
    (5) Agencies must submit this request for a waiver to SBA prior to 
release of the solicitation, contract award, or modification to the 
award for the topic. The request for a waiver must explain and provide 
evidence that the limitations on award size will interfere with the 
ability of the agency to fulfill its research mission through the STTR 
Program; that the agency will minimize, to the maximum extent 
practicable, the number of awards that exceed the guidelines by more 
than 50% for the topic; and that research costs for the topic area 
differ significantly from those in other areas. After review of the 
agency's justification, SBA may grant the waiver for the agency to 
exceed the award guidelines by more than 50% for a specific topic. SBA 
will issue a decision on the request within 10 business days. The 
waiver will be in effect for one fiscal year.
    (6) Agencies must maintain information on all awards exceeding the 
guidelines set forth in paragraph (j)(1), including the amount of the 
award, a justification for exceeding the guidelines for each award, the 
identity and location of the awardee, whether the awardee has received 
any venture capital, hedge fund, or private equity firm investment, and 
whether the awardee is majority-owned by multiple

[[Page 46874]]

VCOCs, hedge funds, or private equity firms.
    (7) The award guidelines do not prevent an agency from funding STTR 
projects from other (non-STTR) agency funds. Non-STTR funds used on 
STTR efforts do not count toward the award guidelines set forth in 
(i)(1).
    (j) National Security Exemption. The Act provides for exemptions 
related to the simplified standardized funding process ``* * * if 
national security or intelligence functions clearly would be 
jeopardized.'' This exemption should not be interpreted as a blanket 
exemption or a prohibition of STTR participation for acquisitions 
relating to national security or intelligence functions, except as 
specifically defined under section 9(e)(2) of the Act, 15 U.S.C. 
638(e)(2). Agency technology managers directing R/R&D projects under 
the STTR Program, where the project subject matter may be affected by 
this exemption, must first make a determination on which, if any, of 
the standardized proceedings clearly place national security and 
intelligence functions in jeopardy, and then proceed with an acceptable 
modified process to complete the STTR action. SBA's STTR Program 
monitoring activities, except where prohibited by security 
considerations, must include a review of nonconforming STTR actions 
justified under this public law provision.

8. Terms of Agreement Under STTR Awards

    (a) Proprietary Information Contained in Proposals. The 
standardized STTR Program solicitation will include provisions 
requiring the confidential treatment of any proprietary information to 
the extent permitted by law. Agencies will discourage SBCs from 
submitting information considered proprietary unless the information is 
deemed essential for proper evaluation of the proposal. The 
solicitation will require that all proprietary information be 
identified clearly and marked with a prescribed legend. Agencies may 
elect to require SBCs to limit proprietary information to that 
essential to the proposal and to have such information submitted on a 
separate page or pages keyed to the text. The Government, except for 
proposal review purposes, protects all proprietary information, 
regardless of type, submitted in a contract proposal or grant 
application for a funding agreement under the STTR Program, from 
disclosure.
    (b) Rights in Data Developed Under STTR Funding Agreement. The Act 
provides for ``retention by an SBC of the rights to data generated by 
the concern in the performance of an STTR award.''
    (1) Each agency must refrain from disclosing STTR technical data 
outside the Government (except reviewers) and especially to competitors 
of the SBC, or from using the information to produce future technical 
procurement specifications that could harm the SBC that discovered and 
developed the innovation.
    (2) STTR agencies must protect from disclosure and non-governmental 
use all STTR technical data developed from work performed under an STTR 
funding agreement for a period of not less than four years from 
delivery of the last deliverable under that agreement (either Phase I, 
Phase II, or Federally-funded STTR Phase III) unless, subject to 
paragraph (b)(3) of this section, the agency obtains permission to 
disclose such STTR technical data from the awardee or STTR applicant. 
Agencies are released from obligation to protect STTR data upon 
expiration of the protection period except that any such data that is 
also protected and referenced under a subsequent STTR award must remain 
protected through the protection period of that subsequent STTR award. 
For example, if a Phase III award is issued within or after the Phase 
II data rights protection period and the Phase III award refers to and 
protects data developed and protected under the Phase II award, then 
that data must continue to be protected through the Phase III 
protection period. Agencies have discretion to adopt a protection 
period longer than four years. The Government retains a royalty-free 
license for Government use of any technical data delivered under an 
STTR award, whether patented or not. This section does not apply to 
program evaluation.
    (3) STTR technical data rights apply to all STTR awards, including 
subcontracts to such awards, that fall within the statutory definition 
of Phase I, II, or III of the STTR Program, as described in section 4 
of this Policy Directive. The scope and extent of the STTR technical 
data rights applicable to Federally-funded Phase III awards is 
identical to the STTR data rights applicable to Phases I and II STTR 
awards. The data rights protection period lapses only:
    (i) Upon expiration of the protection period applicable to the STTR 
award; or
    (ii) by agreement between the awardee and the agency.
    (4) Agencies must insert the provisions of (b)(1), (2), and (3) 
immediately above as STTR data rights clauses into all STTR Phase I, 
Phase II, and Phase III awards. These data rights clauses are non-
negotiable and must not be the subject of negotiations pertaining to an 
STTR Phase III award, or diminished or removed during award 
administration. An agency must not, in any way, make issuance of an 
STTR Phase III award conditional on data rights. If the STTR awardee 
wishes to transfer its STTR data rights to the awarding agency or to a 
third party, it must do so in writing under a separate agreement. A 
decision by the awardee to relinquish, transfer, or modify in any way 
its STTR data rights must be made without pressure or coercion by the 
agency or any other party. Following issuance of an STTR Phase III 
award, the awardee may enter into an agreement with the awarding agency 
to transfer or modify the data rights contained in that STTR Phase III 
award. Such a bilateral data rights agreement must be entered into only 
after the STTR Phase III award, which includes the appropriate STTR 
data rights clause, has been signed. SBA will report to the Congress 
any attempt or action by an agency to condition an STTR award on data 
rights, to exclude the appropriate data rights clause from the award, 
or to diminish such rights.
    (c) Allocation of Rights.
    (1) An SBC, before receiving an STTR award, must negotiate a 
written agreement between the SBC and the single, partnering Research 
Institution, allocating intellectual property rights and rights, if 
any, to carry out follow-on research, development, or 
commercialization. The SBC must submit this agreement to the awarding 
agency with the proposal. The SBC must certify in all proposals that 
the agreement is satisfactory to the SBC.
    (2) The awarding agency may accept an existing agreement between 
the two parties if the SBC certifies its satisfaction with the 
agreement, and such agreement does not conflict with the interests of 
the Government. SBA will provide a model agreement that must be adopted 
by the agencies and used as guidance by the SBC in the development of 
an agreement with the Research Institution. The model agreement will 
direct the parties to, at a minimum:
    (i) State specifically the degree of responsibility, and ownership 
of any product, process, or other invention or innovation resulting 
from the cooperative research. The degree of responsibility shall 
include responsibility for expenses and liability, and the degree of 
ownership shall also include the specific rights to revenues and 
profits.
    (ii) State which party may obtain United States or foreign patents 
or otherwise protect any inventions resulting from the cooperative 
research.

[[Page 46875]]

    (iii) State which party has the right to any continuation of 
research, including non-STTR follow-on awards.
    (3) The Government will not normally be a party to any agreement 
between the SBC and the Research Institution. Nothing in the agreement 
is to conflict with any provisions setting forth the respective rights 
of the United States and the SBC with respect to intellectual property 
rights and with respect to any right to carry out follow-on research.
    (d) Title Transfer Agency-Provided Property. Under the Act, the 
Government may transfer title to property, provided by the STTR agency 
to the awardee or acquired by the awardee for the purpose of fulfilling 
the contract, where such transfer would be more cost effective than 
recovery of the property.
    (e) Continued Use of Government Equipment. The Act directs that an 
agency allow an STTR awardee participating in the third phase of the 
STTR Program continued use, as a directed bailment, of any property 
transferred by the agency to the Phase II awardee. The Phase II awardee 
may use the property for a period of not less than 2 years, beginning 
on the initial date of the concern's participation in the third phase 
of the STTR Program.
    (f) Grant Authority. The Act does not, in and of itself, convey 
grant authority. Each agency must secure grant authority in accordance 
with its normal procedures.
    (g) Conflicts of Interest. SBA cautions STTR agencies that awards 
made to SBCs owned by or employing current or previous Federal 
Government employees may create conflicts of interest in violation of 
FAR Part 3 and the Ethics in Government Act of 1978, as amended. Each 
STTR agency should refer to the standards of conduct review procedures 
currently in effect for its agency to ensure that such conflicts of 
interest do not arise.
    (h) American-Made Equipment and Products. Congress intends that the 
awardee of a funding agreement under the STTR Program should, when 
purchasing any equipment or a product with funds provided through the 
funding agreement, purchase only American-made equipment and products, 
to the extent possible, in keeping with the overall purposes of this 
program. Each STTR agency must provide to each awardee a notice of this 
requirement.
    (i) Certifications After Award and During Funding Agreement 
Lifecycle.
    (1) A Phase I funding agreement must state that the awardee shall 
submit a new certification as to whether it is in compliance with 
specific STTR Program requirements at the time of final payment or 
disbursement.
    (2) A Phase II funding agreement must state that the awardee shall 
submit a new certification as to whether it is in compliance with 
specific STTR Program requirements prior to receiving more than 50% of 
the total award amount and prior to final payment or disbursement.
    (3) Agencies may also require additional certifications at other 
points in time during the life cycle of the funding agreement, such as 
at the time of each payment or disbursement.
    (j) Updating SBIR.gov. Agencies must require each Phase II awardee 
to update the appropriate information on the award in the 
Commercialization Database upon completion of the last deliverable 
under the funding agreement. In addition, the awardee is requested to 
voluntarily update the appropriate information on that award in the 
database annually thereafter for a minimum period of 5 years.

9. Responsibilities of STTR Agencies and Departments

    (a) General Responsibilities. The Act requires each agency 
participating in the STTR Program to:
    (1) Unilaterally determine the categories of projects to be 
included in its STTR Program, giving consideration to maintaining a 
portfolio balance between exploratory projects of high technological 
risk and those with greater likelihood of success. Further, to the 
extent permitted by law, and in a manner consistent with the mission of 
that agency and the purpose of the STTR program, each Federal agency 
must:
    (i) Give priority in the STTR program to manufacturing-related 
research and development in accordance with Executive Order 13329. In 
addition, agencies must develop an Action Plan for implementing 
Executive Order 13329, which identifies activities used to give 
priority in the STTR program to manufacturing-related research and 
development. These activities should include the provision of 
information on the Executive Order on the agency's STTR program Web 
site.
    (ii) Give priority to small business concerns that participate in 
or conduct energy efficiency or renewable energy system research and 
development projects.
    (iii) Give consideration to topics that further one or more 
critical technologies as identified by the National Critical 
Technologies panel (or its successor) in reports required under 42 
U.S.C. 6683, or the Secretary of Defense in accordance with 10 U.S.C. 
2522.
    (2) Release STTR solicitations in accordance with the SBA master 
schedule.
    (3) Unilaterally receive and evaluate proposals resulting from 
program solicitations, select awardees, issue funding agreements, and 
inform each awardee under such agreement, to the extent possible, of 
the expenses of the awardee that will be allowable under the funding 
agreement.
    (4) Require a succinct commercialization plan with each proposal 
submitted for a Phase II award.
    (5) Collect and maintain information from applicants and awardees 
and provide it to SBA to develop and maintain the database, as 
identified in section 11(e) of this Policy Directive.
    (6) Administer its own STTR funding agreements or delegate such 
administration to another agency.
    (7) Include provisions in each STTR funding agreement setting forth 
the respective rights of the United States and the awardee with respect 
to intellectual property rights and with respect to any right to carry 
out follow-on research.
    (8) Ensure that the rights in data developed under each Federally-
funded STTR Phase I, Phase II, and Phase III award are protected 
properly.
    (9) Make payments to awardees of STTR funding agreements on the 
basis of progress toward or completion of the funding agreement 
requirements and in all cases make payment to awardees 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.
    (10) Provide an annual report on the STTR Program to SBA, as well 
as other information concerning the STTR Program. See section 10 of 
this Policy Directive for further information on the agency's reporting 
requirements, including the frequency for specific reporting 
requirements.
    (11) Include in its annual performance plan required by 31 U.S.C. 
1115(a) and (b) a section on its STTR Program, and submit such section 
to the Senate Committee on Small Business and Entrepreneurship and to 
the House Committees on Science, Space and Technology and Small 
Business.
    (12) Establish the agency's benchmarks for progress towards 
commercialization. See section 4(a)(3) of the directive for further 
information.
    (13) Adopt the model agreement to be developed by SBA for use in 
the STTR Program that allocates between SBCs and Research Institutions 
intellectual property rights and rights, if any, to carry out follow-on 
research, development, or commercialization.

[[Page 46876]]

    (14) Develop, in consultation with the Office of Federal 
Procurement Policy and the Office of Government Ethics, procedures to 
ensure that Federally-funded research and development centers that 
participate in STTR agreements:
    (i) Are free from organizational conflicts of interests relative to 
the STTR Program;
    (ii) 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
    (iii) Use outside peer review as appropriate.
    (15) Implement an outreach program to Research Institutions and 
SBCs for the purpose of enhancing its STTR Program, in conjunction with 
any such outreach done for purposes of the Small Business Innovation 
Research (SBIR) Program.
    (b) Discretionary technical assistance to STTR awardees.
    (1) Agencies may enter into agreements with vendors to provide 
technical assistance to STTR awardees, which may include access to a 
network of scientists and engineers engaged in a wide range of 
technologies or access to technical and business literature available 
through on-line data bases. Each agency may select a vendor for a term 
not to exceed 5 years. The vendor must be selected using competitive 
and merit-based criteria.
    (i) The purpose of this technical assistance is to assist STTR 
awardees in:
    (A) Making better technical decisions on STTR projects;
    (B) Solving technical problems that arise during STTR projects;
    (C) Minimizing technical risks associated with STTR projects; and
    (D) Commercializing the STTR product or process.
    (ii) An agency may not enter into a contract with the vendor if the 
contract amount provided for technical assistance is based upon the 
total number of Phase I or Phase II awards but may enter into a 
contract with the vendor based upon the total amount of awards for 
which assistance is provided.
    (2) Each agency may provide up to $5,000 of STTR funds for the 
technical assistance described above in (c)(1) per year for each Phase 
I award and each Phase II award. The amount will be in addition to the 
award and will count as part of the agency's STTR funding, unless the 
agency funds the technical assistance using non-STTR funds. The agency 
may not use STTR funds for technical assistance unless the vendor 
provides the services to the STTR awardee.
    (3) An STTR applicant may acquire the technical assistance services 
set forth in (c)(1)(i) above itself and not through the vendor selected 
by the Federal agency. The applicant must request this authority from 
the Federal agency and demonstrate in its STTR application that the 
individual or entity selected can provide the specific technical 
services needed. If the awardee demonstrates this requirement 
sufficiently, the agency shall permit the awardee to acquire such 
technical assistance itself, in an amount up to $5,000, as an allowable 
cost of the STTR award. The per year amount will be in addition to the 
award and will count as part of the agency's STTR funding, unless the 
agency funds the technical assistance using non-STTR funds.
    (c) Agencies must publish the information relating to timelines for 
awards of Phase I and Phase II funding agreements and performance start 
dates of the funding agreements in the agency's Annual Report (See 
section 10(a) of the directive). Agencies will report this information 
to SBA for posting on www.SBIR.gov.
    (d) Interagency actions.
    (1) Joint funding. An STTR project may be financed by more than one 
Federal agency. Joint funding is not required but can be an effective 
arrangement for some projects.
    (2) Phase II awards. An STTR Phase II award may be issued by a 
Federal agency other than the one that made the Phase I award. Prior to 
award, the head of the Federal agency for the Phase I and Phase II 
awards, or designee, must issue a written determination that the topics 
of the awards are the same. Both agencies must submit the report to the 
SBA.
    (3) Participation by WOSBs and SDBs in the STTR Program. In order 
to meet statutory requirements for greater inclusion, SBA and the 
Federal participating agencies must conduct outreach efforts to find 
and place innovative WOSBs and SDBs in the STTR Program. These SBCs 
will be required to compete for STTR awards on the same basis as all 
other SBCs. However, STTR agencies are encouraged to work independently 
and cooperatively with SBA to develop methods to encourage qualified 
WOSBs and SDBs to participate in the STTR Program.
    (e) Limitation on use of funds.
    (1) Each STTR agency must expend the required minimum percent of 
its extramural budget on awards to SBCs. Agencies may not make 
available for the purpose of meeting the minimum percent an amount of 
its extramural budget for basic research that exceeds the minimum 
percent. Funding agreements with SBCs for R/R&D that result from 
competitive or single source selections other than an STTR Program must 
not be considered to meet any portion of the required minimum percent.
    (2) An agency must not use any of its STTR budget for the purpose 
of funding administrative costs of the program, including costs 
associated with program operations, employee salaries, and other 
associated expenses.
    (3) Pilot to Allow for Funding of Administrative, Oversight, and 
Contract Processing Costs. Beginning on October 1, 2012 and ending on 
September 30, 2015, and upon establishment by SBA of the agency-
specific performance criteria, SBA shall allow an SBIR Federal agency 
to use no more than 3% of its SBIR budget for one or more specific 
activities, which may be prioritized by the federal SBIR/STTR 
Interagency Policy Committee. The purpose of this pilot program is to 
assist with the substantial expansion in commercialization activities, 
prevention of fraud/waste/abuse, expansion of reporting requirements by 
agencies and other agency activities required for the SBIR and STTR 
Programs. Funding under this pilot is not intended to and must not 
replace current agency administrative funding in support of STTR 
activities. Rather, funding under this pilot program is intended to 
supplement such funds.
    (i) A Federal agency may use this money to fund the following 
specific activities:
    (A) SBIR and/or STTR program administration, which includes:
    (I) Internal oversight and quality control, such as verification of 
reports and invoices and cost reviews, and waste/fraud/abuse prevention 
(including targeted reviews of SBIR or STTR awardees that an agency 
determines are at risk for waste/fraud/abuse);
    (II) Carrying out any activities associated with the participation 
by small businesses that are majority-owned by multiple venture capital 
operating companies, hedge funds or private equity firms;
    (III) Contract processing costs relating to the SBIR or STTR 
program of that agency, which includes supplementing the current 
workforce to assist solely with SBIR or STTR funding agreements;
    (IV) Funding of additional personnel to work solely on the STTR 
Program of that agency, which includes assistance with application 
reviews; and
    (V) Funding for simplified and standardized program proposal, 
selection, contracting, compliance, and

[[Page 46877]]

audit procedures for the STTR program, including the reduction of 
paperwork and data collection.
    (B) STTR or SBIR Program-related outreach and related technical 
assistance initiatives not in effect prior to commencement of this 
pilot, except significant expansion or improvement of these 
initiatives, including:
    (I) Technical assistance site visits;
    (II) Personnel interviews; and
    (III) National conferences.
    (C) Commercialization initiatives not in effect prior to 
commencement of this pilot, except significant expansion or improvement 
of these initiatives.
    (D) For DoD and the military departments, carrying out the 
Commercialization Readiness Program set forth in 12(b) of this 
directive, with emphasis on supporting new initiatives that address 
barriers in bringing STTR technologies to the marketplace, including 
intellectual property issues, sales cycle access issues, accelerated 
technology development issues, and other issues.
    (ii) Agencies must use this money to attempt to increase 
participation by SDBs and WOSBs in the STTR Program, and small 
businesses in states with a historically low level of SBIR awards. The 
agency may submit a written request to SBA to waive this requirement. 
The request must explain why the waiver is necessary, demonstrate a 
sufficient need for the waiver, and explain that the outreach 
objectives of the agency are being met and that there has been 
increased participation by small businesses in states with a 
historically low level of SBIR awards.
    (iii) SBA will establish performance criteria each fiscal year by 
which use of these funds will be evaluated for that fiscal year. The 
performance criteria will be metrics that measure the performance areas 
required by statute against the goals set by the agencies in their work 
plans. The performance criteria will be based upon the work plans 
submitted by each agency for a given fiscal year and will be agency-
specific. SBA will work with the STTR agencies in creating a simplified 
template for agencies to use when making their work plans.
    (iv) Each agency must submit its work plan to SBA at least 30 
calendar days prior to the start of each fiscal year for which the 
pilot program is in operation. Agency work plans must include the 
following: a prioritized list of initiatives to be supported; the 
estimated amounts to be spent on each initiative or the estimated 
percentage of administrative funds to be allocated to each initiative; 
milestones for implementing the; the expected results to be achieved; 
and the assessment metrics for each initiative. The work plan must 
identify initiatives that are above and beyond current practice and 
which enhance the agency's STTR program.
    (v) SBA will evaluate the work plan and provide initial comments 
within 15 calendar days of receipt of the plan. SBA's objective in 
evaluating the work plan is to ensure that overall, it provides for 
improvements to the STTR Program of that particular agency. If SBA does 
not provide initial comments within 30 calendar days of receipt of the 
plan, the work plan is deemed approved. If SBA does provide initial 
comments within 30 calendar days, agencies must amend or supplement 
their work plan and resubmit to SBA. Once SBA establishes the agency-
specific performance criteria to measure the benefits of the use of 
these funds under the work plan, the agency may begin using the STTR 
funds for the purposes set forth in the work plan. Agencies can adjust 
their work plans and spending throughout the fiscal year as needed, but 
must notify SBA of material changes in the plan.
    (vi) Agencies must coordinate any activities in the work plan that 
relate to fraud, waste, and abuse prevention, targeted reviews of 
awardees, and implementation of oversight control and quality control 
measures (including verification of reports and invoices and cost 
reviews) with the agency's Office of Inspector General (OIG). If the 
agency allocates more than $50,000,000 to its STTR Program for a fiscal 
year, the agency may share this funding with its OIG when the OIG 
performs the activities.
    (vii) Agencies shall report to the Administrator on use of funds 
under this authority as part of the SBIR/STTR Annual Report. See 
section 10 generally and section 10(i).
    (4) An agency must not issue an STTR funding agreement that 
includes a provision for subcontracting any portion of that agreement 
back to the issuing agency, to any other Federal Government agency, or 
to other units of the Federal Government, except as provided in 
paragraph (f)(5) of the STTR Policy Directive. SBA may issue a case-by-
case waiver to this provision after review of an agency's written 
justification that includes the following information:
    (i) An explanation of why the STTR research project requires the 
use of the Federal facility or personnel, including data that verifies 
the absence of non-Federal facilities or personnel capable of 
supporting the research effort.
    (ii) Why the Agency will not and cannot fund the use of the Federal 
facility or personnel for the STTR project with non-STTR money.
    (iii) The concurrence of the SBC's chief business official to use 
the federal facility or personnel.
    (5) An agency may issue an STTR funding agreement to a small 
business concern that intends to enter into an agreement with a Federal 
laboratory to perform portions of the award or has entered into a 
cooperative research and development agreement (see 15 U.S.C. 3710a(d)) 
with a Federal laboratory, only if there is compliance with the 
following.
    (i) The agency may not require the small business concern enter 
into an agreement with any Federal laboratory to perform any portion of 
an STTR award, as a condition for an STTR award.
    (ii) The agency may not issue an STTR award or approve an agreement 
between an STTR awardee and a Federal laboratory, if the small business 
concern will not meet the minimum performance of work requirements set 
forth in section 6(a)(4) of this directive.
    (iii) The agency may not issue an STTR award or approve an 
agreement between an STTR awardee and a Federal laboratory that 
violates any STTR requirement set forth in statute or the STTR Policy 
Directive, including any STTR data rights protections.
    (iv) The agency and Federal laboratory may not require any STTR 
awardee that has an agreement with a Federal laboratory to perform 
portions of the activities under the STTR award to provide advance 
payment to the Federal laboratory in an amount greater than the amount 
necessary to pay for 30 days of such activities.
    (6) No agency, at its own discretion, may unilaterally cease 
participation in the STTR Program. R/R&D agency budgets may cause 
fluctuations and trends that must be reviewed in light of STTR Program 
purposes. An agency may be considered by SBA for a phased withdrawal 
from participation in the STTR Program over a period of time sufficient 
in duration to minimize any adverse impact on SBCs. However, the SBA 
decision concerning such a withdrawal will be made on a case-by-case 
basis and will depend on significant changes to extramural R/R&D 3-year 
forecasts as found in the annual Budget of the United States Government 
and National Science Foundation breakdowns of total R/R&D obligations 
as published in the Federal Funds for Research and Development. Any 
withdrawal of an STTR agency from the STTR Program will be accomplished 
in a standardized and orderly manner in

[[Page 46878]]

compliance with these statutorily mandated procedures.
    (7) Federal agencies not otherwise required to participate in the 
STTR Program may participate on a voluntary basis. Federal agencies 
seeking to participate in the STTR Program must first submit their 
written requests to SBA. Voluntary participation requires the written 
approval of SBA.
    (f) Preventing Fraud, Waste, and Abuse.
    (1) Agencies shall evaluate risks of fraud, waste, and abuse in 
each application, monitor and administer STTR awards, and create and 
implement policies and procedures to prevent fraud, waste and abuse in 
the STTR Program. To capitalize on OIG expertise in this area, agencies 
must consult with their OIG when creating such policies and procedures. 
Fraud includes any false representation about a material fact or any 
intentional deception designed to deprive the United States unlawfully 
of something of value or to secure from the United States a benefit, 
privilege, allowance, or consideration to which an individual or 
business is not entitled. Waste includes extravagant, careless, or 
needless expenditure of Government funds, or the consumption of 
Government property, that results from deficient practices, systems, 
controls, or decisions. Abuse includes any intentional or improper use 
of Government resources, such as misuse of rank, position, or authority 
or resources. Examples of fraud, waste, and abuse relating to the STTR 
Program include, but are not limited to:
    (i) Misrepresentations or material, factual omissions to obtain, or 
otherwise receive funding under, an STTR award;
    (ii) Misrepresentations of the use of funds expended, work done, 
results achieved, or compliance with program requirements under an STTR 
award;
    (iii) Misuse or conversion of STTR award funds, including any use 
of award funds while not in full compliance with STTR Program 
requirements, or failure to pay taxes due on misused or converted STTR 
award funds;
    (iv) Fabrication, falsification, or plagiarism in applying for, 
carrying out, or reporting results from an STTR award;
    (v) Failure to comply with applicable federal costs principles 
governing an award;
    (vi) Extravagant, careless, or needless spending;
    (vii) Self-dealing, such as making a sub-award to an entity in 
which the PI has a financial interest;
    (viii) Acceptance by agency personnel of bribes or gifts in 
exchange for grant or contract awards or other conflicts of interest 
that prevents the Government from getting the best value; and
    (ix) Lack of monitoring, or follow-up if questions arise, by agency 
personnel to ensure that awardee meets all required eligibility 
requirements, provides all required certifications, performs in 
accordance with the terms and conditions of the award, and performs all 
work proposed in the application.
    (2) At a minimum, agencies must:
    (i) Require certifications from the STTR awardee at the time of 
award, as well as after award and during the funding agreement 
lifecycle (see section 8(h) and Appendix I for more information);
    (ii) Include on their respective STTR Web page and in each 
solicitation, information explaining how an individual can report 
fraud, waste and abuse as provided by the agency's OIG (e.g., include 
the fraud hotline number or Web-based reporting method for the agency's 
OIG);
    (iii) Designate at least one individual in the agency to, at a 
minimum, serve as the liaison for the STTR Program, the OIG and the 
agency's Suspension and Debarment Official (SDO) and ensure that 
inquiries regarding fraud, waste and abuse are referred to the OIG and, 
if applicable, the SDO.
    (iv) Include on their respective STTR Web page information 
concerning successful prosecutions of fraud, waste and abuse in the 
SBIR or STTR programs.
    (v) Establish a written policy requiring all personnel involved 
with the STTR Program to notify the OIG if anyone suspects fraud, 
waste, and/or abuse and ensure the policy is communicated to all STTR 
personnel.
    (vi) Create or ensure there is an adequate system to enforce 
accountability (through suspension and debarment, fraud referrals or 
other efforts to deter wrongdoing and promote integrity) by developing 
separate standardized templates for a referral made to the OIG for 
fraud, waste, and abuse or the SDO for other matters, and a process for 
tracking such referrals.
    (vii) Ensure compliance with the eligibility requirements of the 
program and the terms of the STTR funding agreement.
    (viii) Work with the agency's OIG with regard to its efforts to 
establish fraud detection indicators, coordinate the sharing of 
information between Federal agencies, and improve education and 
training to STTR Program officials, applicants and awardees;
    (ix) Develop policies and procedures to avoid funding essentially 
equivalent work already funded by another agency, which could include: 
searching Tech-Net prior to award for the applicant (if a joint 
venture, search for each party to the joint venture), key individuals 
of the applicant, and similar abstracts; using plagiarism or other 
software; checking the SBC's certification prior to award and funding 
and documenting the funding agreement file that such certification 
evidenced the SBC has not already received funding for essentially 
equivalent work; reviewing other agency's policies and procedures for 
best practices; and reviewing other R&D programs for policies and 
procedures and best practices related to this issue; and
    (x) Consider enhanced reporting requirements during the funding 
agreement.
    (g) Interagency Policy Committee. The Director of the Office of 
Science and Technology Policy (OSTP) will establish an Interagency 
SBIR/STTR Policy Committee, which will include representatives from 
Federal agencies with an SBIR or an STTR program and the SBA. The 
Interagency SBIR/STTR Policy Committee shall review the following 
issues (but may review additional issues) and make policy 
recommendations on ways to improve program effectiveness and 
efficiency:
    (1) The SBIR.gov databases described in section 9(k) of the Small 
Business Act (15 U.S.C. 638(k));
    (2) Federal agency flexibility in establishing Phase I and II award 
sizes, including appropriate criteria for exercising such flexibility;
    (3) Commercialization assistance best practices of Federal agencies 
with significant potential to be employed by other agencies and the 
appropriate steps to achieve that leverage, as well as proposals for 
new initiatives to address funding gaps that business concerns face 
after Phase II but before commercialization;
    (4) The need for a standard evaluation framework to enable 
systematic assessment of SBIR and STTR, including through improved 
tracking of awards and outcomes and development of performance measures 
for the SBIR Program and STTR program of each Federal agency; and
    (5) Outreach and technical assistance activities that increase the 
participation of small businesses underrepresented in the SBIR and STTR 
programs, including the identification and sharing of best practices 
and the leveraging of resources in support of such activities across 
agencies.

[[Page 46879]]

    (h) National Academy of Sciences Report. The National Academy of 
Sciences (NAS) shall conduct a study and issue a report on the SBIR and 
STTR programs.
    (1) Prior to issuing the report, and to ensure that the concerns of 
small business are appropriately considered, NAS shall consult with and 
consider the views of SBA's Office of Investment and Innovation and 
Office of Advocacy and other interested parties, including entities, 
organizations, and individuals actively engaged in enhancing or 
developing the technological capabilities of small business concerns.
    (2) In addition, the head of each agency with a budget of more than 
$50,000,000 for its SBIR Program for fiscal year 1999 shall, in 
consultation with SBA, and not later than 6 months after December 31, 
2011, cooperatively enter into an agreement with NAS in furtherance of 
the report. SBA and the agencies will work with the Interagency Policy 
Committee in determining the parameters of the study, including the 
specific areas of focus and priorities for the broad topics required by 
statute. The agreement will set forth these parameters, specific areas 
of focus and priorities.
    (3) NAS shall transmit to SBA, heads of agencies entering into an 
agreement under this section, the Committee on Science, Space and 
Technology, the Committee on Small Business of the House of 
Representatives, and to the Committee on Small Business of the Senate a 
copy of the report, which includes the results and recommendations, not 
later than 4 years after December 31, 2011, and every subsequent four 
years.

10. Agency and STTR Applicant/Awardee Reporting Requirements

    (a) General. The Small Business Act requires agencies to collect 
meaningful information from SBCs and to ensure that reporting 
requirements are streamlined to minimize the burden on small 
businesses.
    (1) SBA is required to collect data from agencies and report to the 
Congress information regarding applications by and awards to SBCs by 
each Federal agency participating in the STTR program. STTR agencies 
and SBA will report data using standardized templates that are 
provided, maintained, and updated by SBA.
    (2) The Act requires a ``simplified, standardized and timely annual 
report'' from each Federal agency participating in the STTR program 
(see section 3 for the definition of Federal agency), which is 
submitted to SBA. In addition, agencies are required to report certain 
items periodically throughout the year to SBA. Agencies may identify 
certain information, such as award data information, by the various 
components of each agency. SBA will collect reports electronically, to 
the extent possible. The reports will be uploaded to databases attached 
to Tech-Net--located at www.SBIR.gov. If the databases attached to 
Tech-Net are unavailable, then the report must be emailed to 
[email protected].
    (3) To meet these requirements, the STTR program has the following 
key principles:
    (i) Make updating data available electronically;
    (ii) Centralize and share certain data through secure interfaces to 
which only authorized government personnel have access;
    (iii) Have small business enter the data only once, if possible; 
and
    (iv) Provide standardized procedures.
    (b) Summary of STTR Databases.
    (1) The Act requires that SBA coordinate the implementation of 
electronic databases at the STTR agencies, including the technical 
ability of the agencies to share the data. In addition, the Act 
requires the reporting of various data elements, which are clustered 
together in the following subsections:
    (i) Solicitations Database (to include the Master Schedule); and
    (ii) Tech-Net, which includes the following databases:
    (A) Company Registry Database;
    (B) Application Information Database;
    (C) Award Information Database;
    (D) Commercialization Database;
    (E) Annual Report Database; and
    (F) Other Reporting Requirements Database.
    (2) The subsections below describe the data reporting requirements, 
including reporting mechanisms, the frequency of data collection and 
reporting, and whether this information is shared publicly or is 
protected and only available to authorized personnel. The table below 
summarizes the data collection requirements for each database; however, 
there may be some divergences at the individual data field level. Refer 
to Appendices III-IX for the detailed reporting requirements at the 
data field level. SBA notes that not all of the information will be 
collected starting with fiscal year 2012. Rather, beginning in fiscal 
year 2012, SBA will begin a phased implementation of this data 
collection.

----------------------------------------------------------------------------------------------------------------
                                                         Collection/reporting
             Database               Reporting mechanism        frequency               Public/government
----------------------------------------------------------------------------------------------------------------
Solicitations....................  Agency XML or manual  Within 5 business     Public.
                                    upload to http://     days of
                                    SBIR.gov.             solicitation open
                                                          date.
Company Registry.................  SBC reports data to   Register or           Government only.
                                    Tech-Net. Agency      reconfirm at time
                                    receives .pdf from    of application.
                                    company.
Application Information..........  Agency provides XML   Quarterly...........  Government only.
                                    or manual upload to
                                    Tech-Net.
Award Information................  XML or manual upload  Quarterly...........  Public.
                                    to Tech-Net.
Commercialization................  Agencies + companies  Agencies update in    Government only.
                                    report to Tech-Net.   real time.
                                                         SBC updates prior to
                                                          subsequent award
                                                          application and
                                                          voluntarily
                                                          thereafter.
Annual Report....................  Agency XML or manual  Annually............  Public.
                                    upload to Tech-Net.
Other Reports....................  As set forth in the   As set forth in the   Public.
                                    directive.            directive.
----------------------------------------------------------------------------------------------------------------

     (3) STTR awardees will have user names and passwords assigned in 
order to access their respective awards information in the system. 
Award and commercialization data maintained in the database can be 
changed only by the awardee, SBA, or the awarding SBIR/STTR Federal 
agency.
    (c) Master Schedule & the Solicitations Database.
    (1) SBA will post an electronic Master Schedule of release dates of 
program solicitations with links to Internet web sites of agency 
solicitations on www.SBIR.gov.
    (i) On or before August 1, each agency representative must notify 
SBA in writing or by email of its proposed

[[Page 46880]]

program solicitation release and proposal due dates for the next fiscal 
year. SBA and the agency representatives will coordinate the resolution 
of any conflicting agency solicitation dates by the second week of 
August. In all cases, SBA will make final decisions. Agencies must 
notify SBA in writing of any subsequent changes in the solicitation 
release and close dates.
    (ii) For those agencies that use both general topic and more 
specific subtopic designations in their STTR solicitations, the topic 
data should accurately describe the research solicited.
    (iii) Agencies must post on their Internet web sites the following 
information regarding each program solicitation:
    (A) List of topics upon which R/R&D proposals will be sought;
    (B) Agency address, phone number, or email address from which STTR 
Program solicitations can be requested or obtained, especially through 
electronic means;
    (C) Names, addresses, and phone numbers of agency contact points 
where STTR-related inquiries may be directed;
    (D) Release date(s) of program solicitation(s);
    (E) Closing date(s) for receipt of proposals; and
    (F) Estimated number and average dollar amounts of Phase I awards 
to be made under the solicitation.
    (2) SBA will manage a searchable public database that contains all 
solicitation and topic information from all SBIR/STTR agencies. 
Agencies are required to update the Solicitations Database, hosted on 
Tech-Net (available at www.SBIR.gov), within 5 business days of a 
solicitation's open date for applications and/or submissions for SBCs. 
Refer to Appendix III: Solicitations Database for detailed reporting 
requirements. The main data requirements include:
    (i) Type of solicitation--SBIR/STTR;
    (ii) Phase--I or II;
    (iii) Topic description;
    (iv) Sub-topic description;
    (v) Web site for further information; and
    (vi) Applicable contact information per topic or sub-topic, where 
applicable and allowed by law.
    (d) Company Registry Database.
    (1) SBA will maintain and manage a company registry to track 
ownership and affiliation requirements for all companies applying to 
the STTR Program, including participants that are majority-owned by 
multiple VCOCs, private equity firms, or hedge funds.
    (2) Each SBC applying for a Phase I or Phase II award must register 
on Tech-Net prior to submitting an application. The SBC will report 
and/or update ownership information to SBA prior to each STTR 
application submission. The SBC will also be able to view all of the 
ownership and affiliation requirements of the program on the registry 
site.
    (3) Data collected in the Company Registry Database will not be 
shared publicly. Refer to Appendix IV for details on specific data 
shared publicly.
    (4) The SBC will save its information from the registration in a 
.pdf document and will append this document to the application 
submitted to a given agency unless the STTR agencies have a system in 
place where the information can be transmitted automatically from SBA's 
database.
    (5) Refer to Appendix IV for detailed reporting requirements. The 
main data requirements include:
    (i) Basic identifying information for the SBC;
    (ii) The number of employees for the SBC;
    (iii) Whether the SBC has venture capital, hedge fund or private 
equity firm investment and if so, include:
    (A) The percentage of ownership of the awardee held by the VCOC, 
hedge fund or private equity firm;
    (B) The registration by the SBC of whether or not it is majority-
owned by VCOCs, hedge funds, or private equity firms. Please note that 
this may be auto-populated through the individual calculations of 
investments in the SBC already submitted.
    (iv) Information on the affiliates of the SBC, including:
    (A) The names of all affiliates of the SBC; and
    (B) The number of employees of the affiliates;
    (e) Application Information Database.
    (1) SBA will manage an Application Information Database containing 
data from applications to the STTR program across agencies.
    (2) Each agency must upload application data to the Application 
Database at Tech-Net at least quarterly.
    (3) The data in the applicant database is only viewable to 
authorized government officials and not shared publicly.
    (4) Refer to Appendix V for detailed reporting requirements. The 
main data requirements for each Phase I and Phase II application 
include:
    (i) Name, size, and location of the applicant, and the identifying 
number assigned;
    (ii) Name, location, responsible officer, and type for the Research 
Institution in the proposal;
    (iii) An abstract and specific aims of the project;
    (iv) Name, title, contact information, and position in the small 
business of each key individual that will carry out the project;
    (v) Percentage of effort each key individual identified will 
contribute to the project; and
    (vi) Federal agency to which the application is made and contact 
information for the person responsible for reviewing applications and 
making awards under the program.
    (5) The Applicant Information Database connects and cross-checks 
information with the Company Registry and government personnel can see 
connected data.
    (f) Award Information Database.
    (1) SBA will manage a database to collect information from the 
agencies on awards made within the STTR program across agencies.
    (2) Each agency must update the Award Information Database 
quarterly, if not more frequently.
    (3) Most of the data available on the Award Information Database is 
viewable and searchable by the public on Tech-Net.
    (4) Refer to Appendix VI for detailed reporting requirements. The 
main data requirements for each Phase I and Phase II award include:
    (i) Information similar to the Application Information Database--if 
not already collected;
    (ii) Name, size, location and the identifying number assigned to 
the small business concern;
    (iii) Name, location, responsible officer, and type for the 
Research Institution in the proposal;
    (iv) An abstract and specific aims of the project;
    (v) The name, title, contact information, and position in the small 
business of each key individual that will carry out the project;
    (vi) The percentage of effort each key individual identified will 
contribute to the project;
    (vii) The Federal agency making the award;
    (viii) Award amount;
    (ix) Principal investigator identifying information--including 
name, email address, and demographic information;
    (x) More detailed information on location of company;
    (xi) Whether the SBC or the Research Institution initiated their 
collaboration on each assisted STTR project;
    (xii) Whether the SBC or the Research Institution originated any 
technology relating to the assisted STTR project;
    (xiii) The length of time it took to negotiate any licensing 
agreement between the SBC and the Research Institution under each 
assisted STTR project;

[[Page 46881]]

    (xiv) Whether the awardee:
    (A) Has venture capital, hedge fund or private equity firm 
investment and if so, the amount of such investment received by SBC as 
of date of award and amount of additional capital awardee has invested 
in STTR technology;
    (B) Is a WOSB or has a woman as a principal investigator;
    (C) Is an SDB or has a socially and economically disadvantaged 
individual as a principal investigator;
    (D) Is owned by a faculty member or a student of an institution of 
higher education as defined in 20 U.S.C. 1001); and
    (E) Has received the award as a result of the Commercialization 
Program--Pilot Program for Civilian Agencies set forth in Sec.  12(c) 
of the directive.
    (xv) An identification of any business concern or subsidiary 
established for the commercial application of a product or service for 
which an SBIR or STTR award is made.
    (5) The Award Information Database connects and cross-checks 
information with the Company Registry and Application Information 
Database, and government personnel can see connected data.
    (g) Commercialization Database.
    (1) The Commercialization Database will store information reported 
by awardees on the commercial activity resulting from their past STTR 
awards.
    (2) SBA and STTR agencies will have two options to collect this 
information from SBCs. First, SBA may collect commercialization data 
directly from awardees into a central commercialization database. 
Alternatively, agencies may collect commercialization data from 
awardees, and then upload the data to the central commercialization 
database for real-time availability for SBA and other STTR agencies. 
The central commercialization database may be maintained by SBA or 
another Federal agency, as long as there is an interagency agreement 
addressing the database and stating, at a minimum, that all data in the 
database will be available in real-time to authorized Government 
personnel.
    (3) STTR awardees are required to update this information on their 
prior Phase II awards in the Commercialization Database when submitting 
an application for an STTR Phase II award and upon completion of the 
last deliverable for that award.
    (4) Commercialization data at the company level will not be shared 
publicly. Aggregated data that maintains the confidentiality of 
companies may be reported in compliance with the statute.
    (5) Refer to Appendix VII for detailed reporting requirements. The 
main data requirements include for every Phase II award:
    (i) Any business concern or subsidiary established for the 
commercial application of a product or service for which an STTR award 
is made;
    (ii) Total revenue resulting from the sale of new products or 
services, or licensing agreements resulting from the research conducted 
under each Phase II award;
    (iii) Additional investment received from any source, other than 
Phase I or Phase II awards, to further the research and development 
conducted under each Phase II award; and
    (iv) How the proceeds from commercialization, marketing or sale of 
technology resulting from each STTR project were allocated (by 
percentage) between the SBC and the Research Institution;
    (v) Any narrative information that a Phase II awardee voluntarily 
submits to further describe the commercialization efforts of its awards 
and related research;
    (6) The SBC may apportion sales or additional investment 
information relating to more than one Phase II award among those 
awards, if it notes the apportionment for each award. Companies are 
requested to update their records in this database on a voluntary basis 
for at least 5 years following the completion of award.
    (7) Awardees will update their information and add project 
commercialization and sales data using their user names and passwords. 
SBA and STTR agencies will coordinate data collection to ensure that 
small businesses will not need to report the same data more than once.
    (8) Note that the Award Information and Commercialization Databases 
will contain the data necessary for agencies to determine whether an 
applicant meets the agency's benchmarks for progress towards 
commercialization.
    (h) Annual Report.
    (1) Agencies must submit their report to SBA on an annual basis and 
will report for the period ending September 30 of each fiscal year. The 
report is due to SBA by March 15 of each year. For example, the report 
for FY 2012 (October 1, 2011-September 30, 2012) must be submitted to 
SBA by March 15, 2013.
    (2) SBA will provide a template for the Annual Report via Tech-Net 
to agencies to populate with the required information. SBA reserves the 
right to add further detail to the annual report data and performance 
metrics via the template beyond the information provided below and the 
appropriate appendix.
    (3) After agencies submit the annual report to SBA, SBA will also 
calculate the required data, if the supporting data for that 
calculation has already been submitted to SBA (e.g., total STTR dollars 
obligated, the percentage of extramural budget allocated to STTR, 
number of awards exceeding the statutory thresholds). SBA will work 
with the agencies to resolve any data inconsistencies.
    (4) The report must include the following:
    (i) Agency total fiscal year, extramural R/R&D total obligations as 
reported to the National Science Foundation pursuant to the annual 
Budget of the United States Government.
    (ii) STTR Program total fiscal year dollars derived by applying the 
statutory per centum to the agency's extramural R/R&D total 
obligations.
    (iii) STTR Program fiscal year dollars obligated through STTR 
Program funding agreements for Phase I and Phase II.
    (iv) STTR Program fiscal year dollars obligated and number of 
awards through STTR Program funding for Phase I and Phase II further 
analyzed by type of Research Institution.
    (v) Number of topics and subtopics contained in each program 
solicitation.
    (vi) Number of proposals received by the agency for each topic and 
subtopic in each program solicitation.
    (vii) For all applicants and awardees in the applicable fiscal 
year--where applicable, the name and address, solicitation topic and 
subtopic, solicitation number, project title, total dollar amount of 
funding agreement, and applicable demographic information. The agency 
is not required to re-submit applicant and award information in the 
annual report that it has already reported to SBA through Tech-Net as 
required under Appendices IV, V, and VI.
    (viii) Justification for the award of any funding agreement 
exceeding the award guidelines set forth in section 7(h) of this 
directive, the amount of each award exceeding the guidelines, the 
identity and location of the awardee, whether the awardee has received 
any venture capital, hedge fund, or private equity firm investment, and 
whether the awardee is majority-owned by a venture capital operating 
company, hedge fund or private equity firm.
    (ix) Justification for awards made under a topic or subtopic where 
the agency received only one proposal. Agencies must also provide the 
awardee's name and address, the topic or subtopic, and the dollar 
amount of

[[Page 46882]]

award. Awardee information must be collected quarterly--in any case, 
but updated in the agency's annual reports.
    (x) An accounting of Phase I awards made to SBCs that have received 
more than 15 Phase II awards from all agencies in the preceding 5 
fiscal years. Each agency must report: Name of awardee; Phase I funding 
agreement number and date of award; Phase I topic or subtopic title; 
amount and date of previous Phase II funding; and commercialization 
status for each prior Phase II award.
    (xi) All instances in which an agency pursued R/R&D, services, 
production, or any combination of a technology developed by an STTR 
awardee and determined that it was not practicable to enter into a 
follow-on funding agreement with non-STTR funds with that concern. See 
section 9(a)(12) for minimum reporting requirements.
    (xii) The number and dollar value of each STTR and non-STTR award 
(includes grants, contracts and cooperative agreements as well as any 
award issued under the Commercialization Program) over $10,000 and 
compare the number and amount of SBIR awards with awards to other than 
SBCs.
    (xiii) Information relating to the pilot to allow for funding of 
administrative, oversight, and contract processing costs, including the 
money spent on each activity and any other information required in the 
approved work plan to measure the benefits of using these funds for the 
specific activities--especially, as it pertains to the goals outlined 
in the work plan. See section 9(e)(3) concerning the Pilot to Allow for 
Funding of Administrative, Oversight, and Contract Processing Costs.
    (xiv) An analysis of the various activities considered for 
inclusion in the Commercialization Program--Pilot Program for Civilian 
Agencies set forth in section 12(c) of the directive and a statement of 
the reasons why each activity considered was included or not included.
    (xv) A description and the extent to which the agency is increasing 
outreach and awards to SDBs and WOSBs.
    (xvi) General information about the implementation of and 
compliance with the allocation of funds for awardees that are majority-
owned by multiple VCOCs, hedge funds or private equity firms.
    (xvii) A detailed description of any appeals filed on Phase III 
awards pursuant to section 4(c)(8) of the directive and notices of 
noncompliance with the policy directive filed by SBA.
    (xviii) Information relating to each Phase III award made by that 
agency either as a prime or subcontract, including the name of the 
business receiving the Phase III award, the dollar amount, and the 
awarding agency or prime contractor.
    (xix) An accounting of funds, initiatives, and outcomes under the 
commercialization programs set forth in section 12(b) & (c) of this 
directive.
    (xx) By October 13, 2013, and then subsequently in each annual 
report, information relating to the agency's enhancement of 
manufacturing activities, if the agency awards more than $50,000,000 
under the SBIR and STTR Programs combined in a fiscal year. The report 
must include:
    (A) A description of efforts undertaken by the agency to enhance 
U.S. manufacturing activities;
    (B) A comprehensive description of the actions undertaken each year 
by the agency in carrying out the SBIR or STTR Programs to support 
Executive Order 13329 (relating to manufacturing);
    (C) An assessment of the effectiveness of the actions taken at 
enhancing the R&D of U.S. manufacturing technologies and processes;
    (D) A description of efforts by vendors selected to provide 
discretionary technical assistance to help SBIR and STTR business 
concerns manufacture in the U.S.; and
    (E) Recommendations from the agency's SBIR and STTR program 
managers of additional actions to increase manufacturing activities in 
the U.S.
    (5) Before the end of each fiscal year, each agency must submit a 
report to SBA on those SBCs that submitted an application and were 
found to not meet the agency's benchmarks with respect to progress 
towards commercialization. This report must include the name and 
employer identification number of the SBC, the closing date of the 
solicitation to which it proposed, and the agency that issued the 
solicitation.
    (6) The annual report also includes the performance metrics 
information set forth in the next section, Performance Metrics and 
Standards.

(i) Performance Areas, Metrics and Goals

    (1) As part of the agency's work plans, which are submitted 
pursuant to section 9(e) of the directive, SBA will set performance 
criteria. The performance criteria will measure each agency's 
accomplishments in meeting certain performance areas against the 
agency's goals. The Small Business Act establishes broad performance 
areas for the program, including commercialization, streamlining, 
outreach, etc. The metrics used to measure the agency's accomplishments 
in these performance areas will be set with input from the STTR agency. 
Agencies must report their progress on the performance criteria at the 
end of the fiscal year as part of their annual report.
    (2) The metrics and performance areas will evolve over time and can 
be found at www.SBIR.gov. Examples of performance areas and metrics can 
be found at Appendix IX.

(j) Other Reporting Requirements

    (1) SBA will set forth a list of reports that agencies are required 
by statute to submit, in a table format, which will be available at 
www.SBIR.gov.
    (2) The system will include a list of any individual or small 
business concern that has received an STTR award that has been 
convicted of a fraud-related crime involving STTR funds or found 
civilly liable for a fraud-related violation involving STTR funds.
    (3) Agencies must submit to SBA's Administrator, not later than 4 
months after the date of enactment of its annual Appropriations Act, a 
report describing the methodology used for calculating the amount of 
its extramural budget. The report must also include an itemization of 
each research program excluded from the calculation of its extramural 
budget and a brief explanation of why it is excluded.
    (4) Agencies must provide notice to SBA of any case or controversy 
before any Federal judicial or administrative tribunal concerning the 
STTR Program of the Federal agency. This does not include agency level 
protests of awards unless and until the protest is before a Federal 
court or administrative body. The agency must provide notice to SBA 
within 15 business days of the agency's written notification of the 
case or controversy.
    (5) Agencies must provide notice of all instances in which an 
agency pursued research, development, production, or any such 
combination of a technology developed by an SBC using an award made 
under the STTR Program of that agency, where the agency determined that 
it was not practicable to enter into a follow-on non-STTR Program 
funding agreement with that concern. The agency must provide notice to 
SBA within 15 business days of the agency's award. The report must 
include, at a minimum:
    (i) The reasons why the follow-on funding agreement with the 
concern was not practicable;
    (ii) The identity of the entity with which the agency contracted to 
perform the research, development, or production; and

[[Page 46883]]

    (iii) A description of the type of funding agreement under which 
the research, development, or production was obtained.
    (6) Agencies must provide information supporting the agency's 
achievement of the Interagency Policy Committee's policy 
recommendations on ways to improve program effectiveness and 
efficiency. This includes qualitative and quantitative data as 
appropriate, which would measure the agency's progress. The agency must 
provide this information to SBA at the end of each fiscal year.
    (7) Agencies must provide an annual report to SBA, Senate Committee 
on Small Business and Entrepreneurship, House Committee on Small 
Business, and the House Committee on Science, Space, and Technology on 
SBIR and STTR programs and the benefits of these programs to the United 
States. Prior to preparing the report, the agency shall develop metrics 
to evaluate the effectiveness and benefit to the United States of the 
SBIR and STTR programs. The metrics must be science-based and 
statistically driven, reflect the mission of the agency, and include 
factors relating to the economic impact of the programs. The report 
must describe in detail the agency's annual evaluation of the programs 
using these metrics. The final report must be posted online so it can 
be made available to the public.
    (8) NIH, DoD and the Department of Education must provide the 
written determination to SBA anytime it issues a Phase II award to a 
small business concern that did not receive a Phase I award for that R/
R&D. The determination must be submitted prior to award.
    (9) SBA will compile data and report to Congress on the Federal and 
State Technology (FAST) Partnership Program, described in section 12 of 
this Policy Directive. If required by the FAST grant, the grantees will 
report a comprehensive list of the companies that received assistance 
under FAST and if those companies received SBIR or STTR awards and any 
information regarding mentors and Mentoring Networks, as required in 
the Federal and State Technology (FAST) Partnership Program.

(k) Further Clarification on Availability of SBC Information

    (1) Unless stated otherwise, the information contained in the 
Company Registry Database, the Application Information Database, and 
the Commercialization Database are solely available to authorized 
government officials, with the approval of SBA. This includes Congress, 
GAO, agencies participating in the SBIR and the STTR Programs, Office 
of Management and Budget, OSTP, Office of Federal Procurement Policy, 
and other authorized persons who are subject to a nondisclosure 
agreement with the Federal Government covering the use of the 
databases. These databases are used for the purposes of evaluating and 
determining eligibility for the STTR Program, in accordance with Policy 
Directives issued by SBA. Pursuant to 15 U.S.C. Sec.  638(k)(4), 
certain information provided to those databases are privileged and 
confidential and not subject to disclosure pursuant to 5 U.S.C. Sec.  
552 (Government Organization and Employees); nor must it be considered 
to be publication for purposes of 35 U.S.C. Sec.  102(a) or (b).
    Most of the information in the Award Information and Annual Reports 
Databases will be available to the public. Any information that will 
identify the confidential business information of a given small 
business concern will not be disclosed to the public. Those databases 
are available at Tech-Net and offer a vast array of user-friendly 
capabilities that are accessible by the public at no charge. The Award 
Information Database allows for the online submission of SBIR/STTR 
awards data from all STTR agencies. It also allows any end-user to 
perform keyword searches and create formatted reports of SBIR/STTR 
awards information, and for potential research partners to view 
research and development efforts that are ongoing in the SBIR and the 
STTR Programs, increasing the investment opportunities of the SBIR/STTR 
SBCs in the high tech arena.

(l) Waivers

    (1) Agencies must request an extension for additional time between 
the solicitation closing date and notification of recommendation for 
award. SBA will respond to the request for an extension within 5 
business days, as practicable. See section 7(c)(1) of the directive for 
further information.
    (2) Agencies must request a waiver to exceed the award guidelines 
for Phase I and Phase II awards by more than 50% for a specific topic. 
See section 7(i)(4) of the directive for further information.
    (3) Agencies must request a waiver to not use their SBIR funds, as 
part of the pilot allowing for the use of such funds for certain STTR-
related costs, to attempt to increase participation by SDBs and WOSBs 
in the STTR Program, and small businesses in states with a historically 
low level of SBIR awards. See section 9(e)(3)(ii) of the directive for 
further information.
    (4) Agencies must request a waiver to issue a funding agreement 
that includes a provision for subcontracting a portion of that 
agreement back to the issuing agency if there is no exception to this 
requirement in the directive. See section 9(e)(4) of the directive for 
further information.

11. Responsibilities of SBA

    (a) Policy.
    (1) SBA will establish policy and procedures for the program by 
publishing and updating the STTR Policy Directive and promulgating 
regulations. Policy clarification of any part or provision of the 
directive or regulations may be provided by SBA.
    (2) It is essential that STTR agencies do not promulgate any 
policy, rule, regulation, or interpretation that is inconsistent with 
the Act, this Policy Directive, or SBA's regulations relating to the 
STTR Program. SBA's monitoring activity will include review of 
policies, rules, regulations, interpretations, and procedures generated 
to facilitate intra- and interagency STTR Program implementation.
    (3) Waivers providing limited exceptions to certain policies can be 
found at section 10 of the directive.
    (b) Outreach. SBA conducts outreach to achieve a number of 
objectives including:
    (1) Educating the public about the STTR Program via conferences, 
seminars, and presentations;
    (2) Highlighting the successes achieved in the program by 
publishing (via press releases and www.SBIR.gov) success stories, as 
well as hosting awards programs;
    (3) Maintaining SBIR.gov, which is an online public information 
resource that provides comprehensive information regarding the STTR 
Program. This information includes: A listing of solicitation 
information on currently available STTR opportunities, award 
information on all Phase I and Phase II awards, summary annual award 
information for the whole program, and contact information for SBA and 
agency program managers.
    (c) Collection and publication of program-wide data. SBA collects 
and maintains program-wide data within the Tech-Net data system. This 
data includes information on all Phase I and II awards from across all 
STTR agencies, as well as Fiscal Year Annual Report data. See section 
10 of the directive for further information about reporting and data 
collection requirements.
    (d) Monitoring implementation of the program and annually reporting 
to Congress.

[[Page 46884]]

    SBA is responsible for providing oversight and monitoring the 
implementation of the STTR Program at the agency level. This monitoring 
includes:
    (1) STTR Funding Allocations. The magnitude and source of each STTR 
agency's annual allocation reserved for STTR awards are critical to the 
success of the STTR Program. The Act defines the STTR effort (R/R&D), 
the source of the funds for financing the STTR Program (extramural 
budget), and the percentage of such funds to be reserved for the STTR 
Program. The Act requires that SBA monitor these annual allocations.
    (2) STTR Program Solicitation and Award Status. The accomplishment 
of scheduled STTR events, such as STTR Program solicitation releases 
and the issuance of funding agreements is critical to meeting statutory 
mandates and to operating an effective, useful program. SBA monitors 
these and other operational features of the STTR Program and publishes 
information relating to notice of and application for awards under the 
STTR Program for each STTR agency at SBIR.Gov, or Tech-Net. SBA does 
not plan to monitor administration of the awards except in instances 
where SBA assistance is requested and is related to a specific STTR 
project or funding agreement.
    (3) Follow-on Funding Commitments. SBA will monitor whether follow-
on non-Federal funding commitments obtained by Phase II awardees for 
Phase III were considered in the evaluation of Phase II proposals as 
required by the Act.
    (4) Fraud, Waste, and Abuse (FWA). SBA will ensure that each STTR 
agency has taken steps to maintain a FWA prevention system to minimize 
fraud, waste and abuse in the program.
    (5) Performance Areas, Metrics, and Goals. SBA is responsible for 
defining performance areas consistent with statute (e.g., reducing 
timelines for award, simplification) against which agencies will set 
goals. SBA will work with the agencies to set metrics, in order to 
measure an agency's accomplishments of its goals against the defined 
performance areas. The purpose of these metrics and goals is to assist 
SBA in evaluating and reporting on the progress achieved by the 
agencies in improving the STTR Program. For further information on 
Performance Areas, Metrics and Goals see section 10(i).
    (e) Additional efforts to improve the performance of the program. 
SBA, in its continuing effort to improve the program, will make 
recommendations for improvement within the framework of the Program 
Managers' meetings. This may include recommending a ``best practice'' 
currently being utilized by an agency or business, or open discussion 
and feedback on a potential ``best practice'' for agency adoption. This 
may also involve program-wide initiatives.
    (f) Other.
    (1) Federal and State Technology Partnership (FAST) Program. SBA 
coordinates the FAST program. SBA develops the solicitation, reviews 
proposals, and oversees grant awards. FAST provides awardees with 
funding to assist in outreach, proposal preparation, and other 
technical assistance to developing innovation oriented SBCs.
    (2) Critical Technologies. SBA will annually obtain available 
information on the current critical technologies from the National 
Critical Technologies panel (or its successor) and the Secretary of 
Defense and provide such information to the STTR agencies. SBA will 
request this information in June of each year. The data received will 
be submitted to each of the STTR agencies and will also be published in 
the September issue of the STTR Pre-Solicitation Announcement.

12. Supporting Programs and Initiatives

    (a) Federal and State Technology Partnership Program. The purpose 
of the FAST Program is to strengthen the technological competitiveness 
of SBCs in the United States. Congress found that programs that foster 
economic development among small high-technology firms vary widely 
among the States. Thus, the purpose of the FAST Program is to improve 
the participation of small technology firms in the innovation and 
commercialization of new technology, thereby ensuring that the United 
States remains on the cutting-edge of research and development in the 
highly competitive arena of science and technology. SBA administers the 
FAST Program. Additional and detailed information regarding this 
program is available at www.SBIR.gov.
    (b) Commercialization Readiness Program--DoD
    (1) General. The Secretary of Defense and the Secretary of each 
military department is authorized to create and administer a 
``Commercialization Readiness Program'' to accelerate the transition of 
technologies, products, and services developed under the SBIR or STTR 
Program to Phase III, including the acquisition process. The authority 
to create this Commercialization Readiness Program does not eliminate 
or replace any other SBIR or STTR program that enhances the insertion 
or transition of SBIR or STTR technologies. This includes any program 
in effect as of December 31, 2011.
    (2) Identification of research programs for accelerated transition 
to acquisition process. The Secretary of each military department must 
identify research programs of the STTR Program that have the potential 
for rapid transitioning to Phase III and into the acquisition process 
and certify in writing that the successful transition of the program to 
Phase III and into the acquisition process is expected to meet high 
priority military requirements of such military department.
    (3) Limitation. The Secretary of Defense shall identify research 
programs of the STTR Program that have the potential for rapid 
transitioning to Phase III and into the acquisition process after 
receiving this certification from each military department.
    (4) Funding.
    (i) Beginning with FY 2013 and ending in FY 2015, the Secretary of 
Defense and each Secretary of a military department is authorized to 
use its SBIR funds for administration of this program in accordance 
with the procedures and policies set forth in 9(e)(3) of this 
directive.
    (ii) Beginning with FY 2016, the Secretary of Defense and Secretary 
of each military department is only authorized to use not more than an 
amount equal to 1% of its SBIR funds available to DoD or the military 
departments for payment of expenses incurred to administer the 
Commercialization Program. In accordance with the procedures and 
policies set forth in 9(e)(3) of this directive, these funds will be 
taken from the 3% administrative set-aside if the pilot program is 
extended. Such funds--
    (A) Shall not be subject to the limitations on the use of funds in 
9(e)(2) of this directive; and
    (B) Shall not be used to make Phase III awards.
    (5) Contracts Valued at less than $1,000,000,000. For any contract 
awarded by DoD valued at less than $1,000,000,000, the Secretary of 
Defense may:
    (i) Establish goals for the transition of Phase III technologies in 
subcontracting plans; and
    (ii) Require a prime contractor on such a contract to report the 
number and dollar amount of the contracts entered into by the prime 
contractor for Phase III STTR projects.
    (6) The Secretary of Defense shall:
    (i) Set a goal to increase the number of STTR Phase II contracts 
that lead to technology transition into programs of record of fielded 
systems;

[[Page 46885]]

    (ii) Use incentives in effect as of December 31, 2011 or create new 
incentives to encourage agency program managers and prime contractors 
to meet the goal set forth in paragraph (6)(i) above; and
    (iii) Submit the following to SBA, as part of the annual report:
    (A) The number and percentage of Phase II STTR contracts awarded by 
DoD that led to technology transition into programs of record or 
fielded systems;
    (B) Information on the status of each project that received funding 
through the Commercialization Program and the efforts to transition 
these projects into programs of record or fielded systems; and
    (C) A description of each incentive that has been used by DoD and 
the effectiveness of the incentive with respect to meeting DoD's goal 
to increase the number of STTR Phase II contracts that lead to 
technology transition into programs of record of fielded systems.
    (c) Commercialization Program--Pilot Program for Civilian Agencies.
    (1) General. The Commercialization Readiness Pilot Program permits 
the head of any Federal agency participating in the SBIR Program 
(except DoD) to allocate not more than 10% of its funds allocated to 
the SBIR and the STTR Program--
    (i) For follow-on awards to small businesses for technology 
development, testing, evaluation, and commercialization assistance for 
SBIR and STTR Phase II technologies; or
    (ii) For awards to small businesses to support the progress of 
research, research and development, and commercialization conducted 
under the SBIR or STTR programs to Phase III.
    (2) Application to SBA. Before establishing this pilot program, the 
agency must submit a written application to SBA not later than 90 days 
before the first day of the fiscal year in which the pilot program is 
to be established. The written application must set forth a compelling 
reason that additional investment in SBIR or STTR technologies is 
necessary, including unusually high regulatory, systems integration, or 
other costs relating to development or manufacturing of identifiable, 
highly promising small business technologies or a class of such 
technologies expected to substantially advance the mission of the 
agency.
    (3) SBA's Determination. SBA must make its determination regarding 
an application submitted under paragraph (2) above not later than 30 
days before the first day of the fiscal year for which the application 
is submitted. SBA must also publish its determination in the Federal 
Register and make a copy of the determination and any related materials 
available 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.
    (4) Maximum Amount of Award. The STTR agency may not make an award 
to a small business concern under this pilot program in excess of 3 
times the dollar amounts generally established for Phase II awards 
under section 7(i)(1) of this directive.
    (5) Registration. Any small business concern that receives an award 
under this pilot program shall register with the SBA in the Company 
Registry Database.
    (6) Award Criteria or Consideration. When making an award under 
this pilot program, the agency is required to consider whether the 
technology to be supported by the award is likely to be manufactured in 
the United States.
    (7) Termination of Authority. The authority to establish a pilot 
program under this section expires on September 30, 2017, unless 
otherwise extended.
    (d) Phase 0 Proof of Concept Partnership Pilot Program.
    (1) General. The Director of the National Institutes of Health 
(NIH) may use $5,000,000 of the funds allocated for the STTR Program 
set forth in section 2(b) of this directive for a Proof of Concept 
Partnership Pilot Program to accelerate the creation of small 
businesses and the commercialization of research innovations from 
qualifying institutions. A qualifying institution is a university or 
other Research Institution that participates in the NIH's STTR program. 
The Director shall award, through a competitive, merit-based process, 
grants to qualifying institutions in order to implement this program. 
These grants shall only be used to administer Proof of Concept 
Partnership awards.
    (2) Awards to Qualifying Institutions.
    (i) The Director may make awards to a qualifying institution for up 
to $1,000,000 per year for up to 3 years.
    (ii) In determining which qualifying institutions will receive 
pilot program grants, the Director of NIH shall consider, in addition 
to any other criteria the Director determines necessary, the extent to 
which qualifying institutions--
    (A) Have an established and proven technology transfer or 
commercialization office and have a plan for engaging that office in 
the program's implementation;
    (B) Have demonstrated a commitment to local and regional economic 
development;
    (C) Are located in diverse geographies and are of diverse sizes;
    (D) Can assemble project management boards comprised of industry, 
start-up, venture capital, technical, financial, and business experts;
    (E) Have an intellectual property rights strategy or office; and
    (F) Demonstrate a plan for sustainability beyond the duration of 
the funding award.
    (3) Proof of Concept Partnerships. A qualifying institution 
selected by NIH shall establish a Proof of Concept Partnership with NIH 
to award grants to individual researchers. These grants should provide 
researchers with the initial investment and the resources to support 
the proof of concept work and commercialization mentoring needed to 
translate promising research projects and technologies into a viable 
company. This work may include technical validations, market research, 
clarifying intellectual property rights position and strategy, and 
investigating commercial or business opportunities.
    (4) Award Guidelines for Small Businesses. The administrator of a 
Proof of Concept Partnership program shall award grants in accordance 
with the following guidelines:
    (i) The Proof of Concept Partnership shall use a market-focused 
project management oversight process, including--
    (A) A rigorous, diverse review board comprised of local experts in 
translational and proof of concept research, including industry, start-
up, venture capital, technical, financial, and business experts and 
university technology transfer officials;
    (B) Technology validation milestones focused on market feasibility;
    (C) Simple reporting effective at redirecting projects; and
    (D) The willingness to reallocate funding from failing projects to 
those with more potential.
    (ii) The Proof of Concept Partnership shall not award more than 
$100,000 towards an individual proposal.
    (5) Educational Resources and Guidance. The administrator of a 
Proof of Concept Partnership program shall make educational resources 
and guidance available to researchers attempting to commercialize their 
innovations.
    (6) Limitations.
    (i) The funds for the pilot program shall not be used for basic 
research or to fund the acquisition of research equipment or supplies 
unrelated to commercialization activities.

[[Page 46886]]

    (ii) The funds for the pilot program can be used to evaluate the 
commercial potential of existing discoveries, including proof of 
concept research or prototype development; and activities that 
contribute to determining a project's commercialization path, to 
include technical validations, market research, clarifying intellectual 
property rights, and investigating commercial and business 
opportunities.
    (7) Termination of Authority. The pilot program under this 
subsection shall terminate on September 30, 2017, unless otherwise 
extended.

Appendix I: Instructions for STTR Program Solicitation Preparation

    a. General. Section 9(p) of the Small Business Act (15 U.S.C. 
638(p)) requires ``* * * simplified, standardized and timely STTR 
solicitations'' and for STTR agencies to utilize a ``uniform process'' 
minimizing the regulatory burden of participation. Therefore, the 
following instructions purposely depart from normal Government 
solicitation formats and requirements. STTR solicitations must be 
prepared and issued as program solicitations in accordance with the 
following instructions.
    b. Limitation in Size of Solicitation. In the interest of meeting 
the requirement for simplified and standardized solicitations, while 
also recognizing that the Internet has become the main vehicle for 
distribution, each agency should structure its entire STTR solicitation 
to produce the least number of pages (electronic and printed), 
consistent with the procurement/assistance standing operating 
procedures and statutory requirements of the participating Federal 
agencies.
    c. Format. STTR Program solicitations must be prepared in a simple, 
standardized, easy-to-read, and easy-to-understand format. It must 
include a cover sheet, a table of contents, and the following sections 
in the order listed.

1. Program Description
2. Certifications
3. Proposal Preparation Instructions and Requirements
4. Method of Selection and Evaluation Criteria
5. Considerations
6. Submission of Proposals
7. Scientific and Technical Information Sources
8. Submission Forms and Certifications
9. Research Topics

d. Cover Sheet.
    The cover sheet of an STTR Program solicitation must clearly 
identify the solicitation as an STTR solicitation, identify the agency 
releasing the solicitation, specify date(s) on which contract proposals 
or grant applications (proposals) are due under the solicitation, and 
state the solicitation number or year.

Instructions for Preparation of STTR Program Solicitation

Sections 1 Through 9
    1. Program Description.
    (a) Summarize in narrative form the invitation to submit proposals 
and the objectives of the STTR Program.
    (b) Describe in narrative form the agency's STTR Program, including 
a description of the three phases. Note in your description whether the 
solicitation is for Phase I or Phase II proposals. Also note in each 
solicitation for Phase I that all awardees may apply for a Phase II 
award and provide guidance on the procedure for doing so.
    (c) Describe program eligibility:
    (d) List the name, address and telephone number of agency contacts 
for general information on the STTR Program solicitation.
    (e) Whenever terms are used that are unique to the STTR Program, a 
specific STTR solicitation or a portion of a solicitation, define them 
or refer them to a source for the definition. At a minimum, the 
definitions of ``funding agreement,'' ``R/R&D,'' ``SBC,'' ``STTR 
technical data,'' and STTR technical data rights'' must be included.
    (f) Include information explaining how an individual can report 
fraud, waste and abuse (e.g. include the fraud hotline for the agency's 
Office of Inspector General);
    2. Certifications.
    (a) This section must include certifying forms required by 
legislation, regulation or standing operating procedures, to be 
submitted by the applicant to the contracting or granting agency. This 
would include certifying forms such as those for the protection of 
human and animal subjects.
    (b) This section must include any certifications required 
concerning size, ownership and other STTR Program requirements.
    (i) The agency must require any SBC that is majority-owned by 
multiple venture capital operating companies, hedge funds, or private 
equity firms to submit the following certification with its STTR 
application:
BILLING CODE 8025-01-P

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[[Page 46888]]


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    (ii) The agency may request the STTR applicant to submit a 
certification at the time of submission of the application or offer. 
The certification may require the applicant to state that it intends to 
meet the size, ownership and other requirements of the STTR Program at 
the time of award of the funding agreement, if selected for award.
    (iii) The agency must request the STTR applicant to submit a 
certification at the time of award and at any other time set forth in 
SBA's regulations at 13 CFR Sec. Sec.  121.701-121.705. The 
certification will require the applicant to state that it meets the 
size, ownership and other requirements of the STTR Program at the time 
of award of the funding agreement.
    (iv) The agency must request the STTR awardee to submit 
certifications during funding agreement life cycle. A Phase I funding 
agreement must state

[[Page 46889]]

that the awardee shall submit a new certification as to whether it 
qualifies as a SBC and that it is in compliance with specific STTR 
Program requirements at the time of final payment or disbursement. A 
Phase II funding agreement must state that the awardee shall submit a 
new certification as to whether it qualifies as a SBC and that it is in 
compliance with specific STTR Program requirements prior to receiving 
more than 50% of the total award amount and prior to final payment or 
disbursement.
    (v) Agencies may require additional certifications at other points 
in time during the life cycle of the funding agreement, such as at the 
time of each payment or disbursement.
    (c) The agency must use the following certification at the time of 
award and upon notification by SBA, must check www.SBIR.gov for updated 
certifications prepared by SBA:

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    (d) The agency must use the following certification during the 
lifecycle of the funding agreement in accordance with subsection 8(h) 
of the directive and paragraph 2(b)(iv) of this Appendix and upon 
notification by SBA, must check www.SBIR.gov for updated certifications 
prepared by SBA:

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BILLING CODE 8025-01-C
    3. Proposal Preparation Instructions and Requirements. The purpose 
of this section is to inform the applicant on what to include in the 
proposal and to

[[Page 46895]]

set forth limits on what may be included. This section of the proposal 
should also provide guidance to assist applicants, particularly those 
that may not have previous Government experience, in improving the 
quality and acceptance of proposals.
    (a) Limitations on Length of Proposal. Include at least the 
following information:
    (1) STTR Phase I proposals must not exceed a total of 25 pages, 
including cover page, budget, and all enclosures or attachments, unless 
stated otherwise in the agency solicitation. Pages should be of 
standard size (8\1/2\ inches by 11 inches or 21.6 centimeters by 27.9 
centimeters) and should conform to the standard formatting 
instructions. Margins should be 1 inch or 2.6 centimeters and type at 
least 10 point font.
    (2) A notice that no additional attachments, appendices, or 
references beyond the 25-page limitation shall be considered in 
proposal evaluation (unless specifically solicited by an agency) and 
that proposals in excess of the page limitation shall not be considered 
for review or award.
    (b) Proposal Cover Sheet. Every applicant is required to provide a 
copy of its registration information printed from the Company Registry 
unless the information can be transmitted automatically to STTR 
agencies. Each applicant must also include at least the following 
information on the first page of proposals.
    (1) Agency and solicitation number or year.
    (2) Topic Number or Letter.
    (3) Subtopic Number or Letter.
    (4) Topic Area.
    (5) Project Title.
    (6) Name and Complete Address of Firm.
    (7) Disclosure permission (by statement or checkbox), such as 
follows, must be included at the discretion of the funding agency:
``Will you permit the Government to disclose the name, address, and 
telephone number of the corporate official of your concern, if your 
proposal does not result in an award, to appropriate local and State-
level economic development organizations that may be interested in 
contacting you for further information? Yes-- No--''
    (8) Signature of a company official of the proposing SBC and that 
individual's typed name, title, address, telephone number, and date of 
signature.
    (9) Signature of Principal Investigator or Project Manager within 
the proposing SBC and that individual's typed name, title, address, 
telephone number, and date of signature.
    (10) Legend for proprietary information as described in the 
``Considerations'' section of this program solicitation if appropriate. 
It may also be noted by asterisks in the margins on proposal pages.
    (c) Data Collection Requirement.
    (1) Each Phase I and Phase II applicant is required to provide 
information for SBA's database (www.sbir.gov). The following are 
examples of the data to be entered by applicants into the database:
    (i) Any business concern or subsidiary established for the 
commercial application of a product or service for which an STTR award 
is made.
    (ii) Revenue from the sale of new products or services resulting 
from the research conducted under each Phase II award;
    (iii) Additional investment from any source, other than Phase I or 
Phase II awards, to further the research and development conducted 
under each Phase II award.
    (iv) Update the information in the database for any prior Phase II 
award received by the SBC. The SBC may apportion sales or additional 
investment information relating to more than one Phase II award among 
those awards, if it notes the apportionment for each award.
    (2) Each Phase II awardee is required to update the appropriate 
information on the award in the database upon completion of the last 
deliverable under the funding agreement and is requested to voluntarily 
update the information in the database annually thereafter for a 
minimum period of 5 years.
    (d) Abstract or Summary. Applicants will be required to include a 
one-page project summary of the proposed R/R&D including at least the 
following:
    (1) Name and address of SBC.
    (2) Name and title of principal investigator or project manager.
    (3) Agency name, solicitation number, solicitation topic, and 
subtopic.
    (4) Title of project.
    (5) Technical abstract limited to two hundred words.
    (6) Summary of the anticipated results and implications of the 
approach (both Phases I and II) and the potential commercial 
applications of the research.
    (e) Technical Content. STTR Program solicitations must require as a 
minimum the following to be included in proposals submitted thereunder:
    (1) Identification and Significance of the Problem or Opportunity. 
A clear statement of the specific technical problem or opportunity 
addressed.
    (2) Phase I Technical Objectives. State the specific objectives of 
the Phase I research and development effort, including the technical 
questions it will try to answer to determine the feasibility of the 
proposed approach.
    (3) Phase I Work Plan. Include a detailed description of the Phase 
I R/R&D plan. The plan should indicate what will be done, where it will 
be done, and how the R/R&D will be carried out. Phase I R/R&D should 
address the objectives and the questions cited in (e)(2) immediately 
above. The methods planned to achieve each objective or task should be 
discussed in detail.
    (4) Related R/R&D. Describe significant R/R&D that is directly 
related to the proposal including any conducted by the project manager/
principal investigator or by the proposing SBC. Describe how it relates 
to the proposed effort, and any planned coordination with outside 
sources. The applicant must persuade reviewers of his or her awareness 
of key, recent R/R&D conducted by others in the specific topic area.
    (5) Key Individuals and Bibliography of Directly Related Work. 
Identify key individuals involved in Phase I including their directly-
related education, experience, and bibliographic information. Where 
vitae are extensive, summaries that focus on the most relevant 
experience or publications are desired and may be necessary to meet 
proposal size limitation.
    (6) Relationship with Future R/R&D.
    (i) State the anticipated results of the proposed approach if the 
project is successful (Phase I and II).
    (ii) Discuss the significance of the Phase I effort in providing a 
foundation for the Phase II R/R&D effort.
    (7) Facilities. A detailed description, availability and location 
of instrumentation and physical facilities proposed for Phase I should 
be provided.
    (8) Consultants. Involvement of consultants in the planning and 
research stages of the project is permitted. If such involvement is 
intended, it should be described in detail.
    (9) Potential Post Applications. Briefly describe:
    (i) Whether and by what means the proposed project appears to have 
potential commercial application.
    (ii) Whether and by what means the proposed project appears to have 
potential use by the Federal Government.
    (10) Similar Proposals or Awards. WARNING--While it is permissible 
with proposal notification to submit identical proposals or proposals 
containing a significant amount of

[[Page 46896]]

essentially equivalent work for consideration under numerous Federal 
program solicitations, it is unlawful to enter into funding agreements 
requiring essentially equivalent work. If there is any question 
concerning this, it must be disclosed to the soliciting agency or 
agencies before award. If an applicant elects to submit identical 
proposals or proposals containing a significant amount of essentially 
equivalent work under other Federal program solicitations, a statement 
must be included in each such proposal indicating:
    (i) The name and address of the agencies to which proposals were 
submitted or from which awards were received.
    (ii) Date of proposal submission or date of award.
    (iii) Title, number, and date of solicitations under which 
proposals were submitted or awards received.
    (iv) The specific applicable research topics for each proposal 
submitted or award received.
    (v) Titles of research projects.
    (vi) Name and title of principal investigator or project manager 
for each proposal submitted or award received.
    (11) Prior STTR Phase II Awards. If the SBC has received more than 
15 Phase II awards in the prior 5 fiscal years, the SBC must submit in 
its Phase I proposal: name of the awarding agency; date of award; 
funding agreement number; amount of award; topic or subtopic title; 
follow-on agreement amount; source and date of commitment; and current 
commercialization status for each Phase II award. (This required 
proposal information will not be counted toward the proposal pages 
limitation.)
    (f) Cost Breakdown/Proposed Budget. The solicitation will require 
the submission of simplified cost or budget data.
    4. Method of Selection and Evaluation Criteria.
    (a) Standard Statement. Essentially the following statement must be 
included in all STTR Program solicitations:
    ``All Phase I and II proposals will be evaluated and judged on a 
competitive basis. Proposals will be initially screened to determine 
responsiveness. Proposals passing this initial screening will be 
technically evaluated by engineers or scientists to determine the most 
promising technical and scientific approaches. Each proposal will be 
judged on its own merit. The Agency is under no obligation to fund any 
proposal or any specific number of proposals in a given topic. It also 
may elect to fund several or none of the proposed approaches to the 
same topic or subtopic.''
    (b) Evaluation Criteria.
    (1) The STTR agency must develop a standardized method in its 
evaluation process that will consider, at a minimum, the following 
factors:
    (i) The technical approach and the anticipated agency and 
commercial benefits that may be derived from the research.
    (ii) The adequacy of the proposed effort and its relationship to 
the fulfillment of requirements of the research topic or subtopics.
    (iii) The soundness and technical merit of the proposed approach 
and its incremental progress toward topic or subtopic solution.
    (iv) Qualifications of the proposed principal/key investigators, 
supporting staff, and consultants.
    (v) Evaluations of proposals require, among other things, 
consideration of a proposal's commercial potential as evidenced by:
    (A) The SBC's record of commercializing STTR or other research;
    (B) The existence of second phase funding commitments from private 
sector or non-STTR funding sources;
    (C) The existence of third phase follow-on commitments for the 
subject of the research; and
    (D) The presence of other indicators of the commercial potential of 
the idea.
    (2) The factors in (b)(1) above and other appropriate evaluation 
criteria, if any, must be specified in the ``Method of Selection'' 
section of STTR Program solicitations.
    (c) Peer Review. The program solicitation must indicate if the STTR 
agency contemplates that as a part of the STTR proposal evaluation, it 
will use external peer review.
    (d) Release of Proposal Review Information. After final award 
decisions have been announced, the technical evaluations of the 
applicant's proposal may be provided to the applicant. The identity of 
the reviewer must not be disclosed.
    5. Considerations. This section must include, as a minimum, the 
following information:
    (a) Awards. Indicate the estimated number and type of awards 
anticipated under the particular STTR Program solicitation in question, 
including:
    (i) Approximate number of Phase I awards expected to be made.
    (ii) Type of funding agreement, that is, contract, grant or 
cooperative agreement.
    (iii) Whether fee or profit will be allowed.
    (iv) Cost basis of funding agreement, for example, fixed-price, 
cost reimbursement, or cost-plus-fixed fee.
    (v) Information on the approximate average dollar value of awards 
for Phase I and Phase II.
    (b) Reports. Describe the frequency and nature of reports that will 
be required under Phase I funding agreements. Interim reports should be 
brief letter reports.
    (c) Payment Schedule. Specify the method and frequency of progress 
and final payment under Phase I and II agreements.
    (d) Innovations, Inventions and Patents.
    (i) Proprietary Information. Essentially the following statement 
must be included in all STTR solicitations:
    ``Information contained in unsuccessful proposals will remain the 
property of the applicant. The Government may, however, retain copies 
of all proposals. Public release of information in any proposal 
submitted will be subject to existing statutory and regulatory 
requirements. If proprietary information is provided by an applicant in 
a proposal, which constitutes a trade secret, proprietary commercial or 
financial information, confidential personal information or data 
affecting the national security, it will be treated in confidence, to 
the extent permitted by law. This information must be clearly marked by 
the applicant with the term `confidential proprietary information' and 
the following legend must appear on the title page of the proposal: 
`These data shall not be disclosed outside the Government and shall not 
be duplicated, used, or disclosed in whole or in part for any purpose 
other than evaluation of this proposal. If a funding agreement is 
awarded to this applicant as a result of or in connection with the 
submission of these data, the Government shall have the right to 
duplicate, use, or disclose the data to the extent provided in the 
funding agreement and pursuant to applicable law. This restriction does 
not limit the Government's right to use information contained in the 
data if it is obtained from another source without restriction. The 
data subject to this restriction are contained on pages ---- of this 
proposal.' ''
    Any other legend may be unacceptable to the Government and may 
constitute grounds for removing the proposal from further 
consideration, without assuming any liability for inadvertent 
disclosure. The Government will limit dissemination of such information 
to within official channels.''

[[Page 46897]]

    (ii) Alternative To Minimize Proprietary Information. Agencies may 
elect to instruct applicants to:
    (A) Limit proprietary information to only that absolutely essential 
to their proposal.
    (B) Provide proprietary information on a separate page with a 
numbering system to key it to the appropriate place in the proposal.
    (iii) Rights in Data Developed Under STTR Funding Agreements. 
Agencies should insert essentially the following statement in their 
STTR Program solicitations to notify SBCs of the necessity to mark STTR 
technical data before delivering it to the Agency:
    ``To preserve the STTR data rights of the awardee, the legend (or 
statements) used in the STTR Data Rights clause included in the STTR 
award must be affixed to any submissions of technical data developed 
under that STTR award. If no Data Rights clause is included in the STTR 
award, the following legend, at a minimum, should be affixed to any 
data submissions under that award.
    These STTR data are furnished with STTR rights under Funding 
Agreement No. ---- (and subcontract No. ---- if appropriate), Awardee 
Name ------------, Address, Expiration Period of STTR Data Rights ----
--------. The Government may not use, modify, reproduce, release, 
perform, display, or disclose technical data or computer software 
marked with this legend for (choose four (4) or five (5) years). After 
expiration of the (4- or 5-year period), the Government has a royalty-
free license to use, and to authorize others to use on its behalf, 
these data for Government purposes, and is relieved of all disclosure 
prohibitions and assumes no liability for unauthorized use of these 
data by third parties, except that any such data that is also protected 
and referenced under a subsequent STTR award shall remain protected 
through the protection period of that subsequent STTR award. 
Reproductions of these data or software must include this legend.''
    (iv) Copyrights. Include an appropriate statement concerning 
copyrights and publications; for example:
    ``With prior written permission of the contracting officer, the 
awardee normally may copyright and publish (consistent with appropriate 
national security considerations, if any) material developed with 
(agency name) support. (Agency name) receives a royalty-free license 
for the Federal Government and requires that each publication contain 
an appropriate acknowledgement and disclaimer statement.''
    (v) Patents. Include an appropriate statement concerning patents. 
For example:
    ``Small business concerns normally may retain the principal 
worldwide patent rights to any invention developed with Government 
support. In such circumstances, the Government receives a royalty-free 
license for Federal Government use, reserves the right to require the 
patent holder to license others in certain circumstances, and may 
require that anyone exclusively licensed to sell the invention in the 
United States must normally manufacture it domestically. To the extent 
authorized by 35 U.S.C. 205, the Government will not make public any 
information disclosing a Government-supported invention for a minimum 
4-year period (that may be extended by subsequent STTR funding 
agreements) to allow the awardee a reasonable time to pursue a 
patent.''
    (vi) Invention Reporting. Include requirements for reporting 
inventions. Include appropriate information concerning the reporting of 
inventions, for example:
    ``STTR awardees must report inventions to the awarding agency 
within 2 months of the inventor's report to the awardee. The reporting 
of inventions may be accomplished by submitting paper documentation, 
including fax.''
    Note: Some agencies provide electronic reporting of inventions 
through the NIH iEdison Invention Reporting System (iEdison System). 
Use of the iEdison System satisfies all invention reporting 
requirements mandated by 37 CFR part 401, with particular emphasis on 
the Standard Patent Rights Clauses, 37 CFR 401.14. Access to the system 
is through a secure interactive Internet site, http://www.iedison.gov, 
to ensure that all information submitted is protected. All agencies are 
encouraged to use the Edison System. In addition to fulfilling 
reporting requirements, the Edison System notifies the user of future 
time sensitive deadlines with enough lead-time to avoid the possibility 
of loss of patent rights due to administrative oversight.
    (e) Cost-Sharing. Include a statement essentially as follows:
    Cost-sharing is permitted for proposals under this program 
solicitation; however, cost-sharing is not required. Cost-sharing will 
not be an evaluation factor in consideration of your Phase I proposal.
    (f) Profit or Fee. Include a statement on the payment of profit or 
fee on awards made under the STTR Program solicitation.
    (g) Joint Ventures or Limited Partnerships. Include essentially the 
following language:
    Joint ventures and limited partnerships are eligible provided the 
entity created qualifies as a small business concern as defined in this 
program solicitation.
    (h) Research and Analytical Work. Include essentially the following 
statement:
    (1) ``For both Phase I and Phase II, not less than 40 percent of 
the R/R&D work must be performed by the SBC, and not less than 30 
percent of the R/R&D work must be performed by the single, partnering 
Research Institution, as defined in this solicitation.''
    (i) Awardee Commitments. To meet the legislative requirement that 
STTR solicitations be simplified, standardized and uniform, clauses 
expected to be in or required to be included in STTR funding agreements 
must not be included in full or by reference in STTR Program 
solicitations. Rather, applicants must be advised that they will be 
required to make certain legal commitments at the time of execution of 
funding agreements resulting from STTR Program solicitations. 
Essentially, the following statement must be included in the 
``Considerations'' section of STTR Program solicitations:
    ``Upon award of a funding agreement, the awardee will be required 
to make certain legal commitments through acceptance of numerous 
clauses in Phase I funding agreements. The outline that follows is 
illustrative of the types of clauses to which the contractor would be 
committed. This list is not a complete list of clauses to be included 
in Phase I funding agreements, and is not the specific wording of such 
clauses. Copies of complete terms and conditions are available upon 
request.''
    (j) Summary Statements. The following are illustrative of the type 
of summary statements to be included immediately following the 
statement in subparagraph (i). These statements are examples only and 
may vary depending upon the type of funding agreement used.
    (1) Standards of Work. Work performed under the funding agreement 
must conform to high professional standards.
    (2) Inspection. Work performed under the funding agreement is 
subject to Government inspection and evaluation at all times.
    (3) Examination of Records. The Comptroller General (or a duly 
authorized representative) must have the right to examine any pertinent 
records of the awardee involving

[[Page 46898]]

transactions related to this funding agreement.
    (4) Default. The Government may terminate the funding agreement if 
the contractor fails to perform the work contracted.
    (5) Termination for Convenience. The funding agreement may be 
terminated at any time by the Government if it deems termination to be 
in its best interest, in which case the awardee will be compensated for 
work performed and for reasonable termination costs.
    (6) Disputes. Any dispute concerning the funding agreement that 
cannot be resolved by agreement must be decided by the contracting 
officer with right of appeal.
    (7) Contract Work Hours. The awardee may not require an employee to 
work more than 8 hours a day or 40 hours a week unless the employee is 
compensated accordingly (for example, overtime pay).
    (8) Equal Opportunity. The awardee will not discriminate against 
any employee or applicant for employment because of race, color, 
religion, sex, or national origin.
    (9) Affirmative Action for Veterans. The awardee will not 
discriminate against any employee or applicant for employment because 
he or she is a disabled veteran or veteran of the Vietnam era.
    (10) Affirmative Action for Handicapped. The awardee will not 
discriminate against any employee or applicant for employment because 
he or she is physically or mentally handicapped.
    (11) Officials Not To Benefit. No Government official must benefit 
personally from the STTR funding agreement.
    (12) Covenant Against Contingent Fees. No person or agency has been 
employed to solicit or secure the funding agreement upon an 
understanding for compensation except bona fide employees or commercial 
agencies maintained by the awardee for the purpose of securing 
business.
    (13) Gratuities. The funding agreement may be terminated by the 
Government if any gratuities have been offered to any representative of 
the Government to secure the award.
    (14) Patent Infringement. The awardee must report each notice or 
claim of patent infringement based on the performance of the funding 
agreement.
    (15) American Made Equipment and Products. When purchasing 
equipment or a product under the STTR funding agreement, purchase only 
American-made items whenever possible.
    (k) Additional Information. Information pertinent to an 
understanding of the administration requirements of STTR proposals and 
funding agreements not included elsewhere must be included in this 
section. As a minimum, statements essentially as follows must be 
included under ``Additional Information'' in STTR Program 
solicitations:
    (1) This program solicitation is intended for informational 
purposes and reflects current planning. If there is any inconsistency 
between the information contained herein and the terms of any resulting 
STTR funding agreement, the terms of the funding agreement are 
controlling.
    (2) Before award of an STTR funding agreement, the Government may 
request the applicant to submit certain organizational, management, 
personnel, and financial information to assure responsibility of the 
applicant.
    (3) The Government is not responsible for any monies expended by 
the applicant before award of any funding agreement.
    (4) This program solicitation is not an offer by the Government and 
does not obligate the Government to make any specific number of awards. 
Also, awards under the STTR Program are contingent upon the 
availability of funds.
    (5) The STTR Program is not a substitute for existing unsolicited 
proposal mechanisms. Unsolicited proposals must not be accepted under 
the STTR Program in either Phase I or Phase II.
    (6) If an award is made pursuant to a proposal submitted under this 
STTR Program solicitation, a representative of the contractor or 
grantee or party to a cooperative agreement will be required to certify 
that the concern has not previously been, nor is currently being, paid 
for essentially equivalent work by any Federal agency.
    6. Submission of Proposals.
    (a) This section must clearly specify the closing date on which all 
proposals are due to be received.
    (b) This section must specify the number of copies of the proposal 
that are to be submitted.
    (c) This section must clearly set forth the complete mailing and/or 
delivery address(es) where proposals are to be submitted.
    (d) This section may include other instructions such as the 
following:
    (1) Bindings. Please do not use special bindings or covers. Staple 
the pages in the upper left corner of the cover sheet of each proposal.
    (2) Packaging. All copies of a proposal should be sent in the same 
package.
    7. Scientific and Technical Information Sources. Wherever 
descriptions of research topics or subtopics include reference to 
publications, information on where such publications will normally be 
available must be included in a separate section of the solicitation 
entitled ``Scientific and Technical Information Sources.''
    8. Research Topics. Describe sufficiently the R/R&D topics and 
subtopics for which proposals are being solicited to inform the 
applicant of technical details of what is desired. Allow flexibility in 
order to obtain the greatest degree of creativity and innovation 
consistent with the overall objectives of the STTR Program.
    9. Submission Forms. Multiple copies of proposal preparation forms 
necessary to the contracting and granting process may be required. This 
section may include Proposal Summary, Proposal Cover, Budget, 
Checklist, and other forms the sole purpose of which is to meet the 
mandate of law or regulation and simplify the submission of proposals.

Appendix II: Codes for Tech-Net Database Program Codes

------------------------------------------------------------------------
             Program                              Meaning
------------------------------------------------------------------------
SBIR.............................  Small Business Innovation Research.
STTR.............................  Small Business Technology Transfer.
BOTH.............................  Both SBIR and STTR.
------------------------------------------------------------------------

Agency Codes

------------------------------------------------------------------------
              Agency                              Meaning
------------------------------------------------------------------------
DHS..............................  Department of Homeland Security.
DOC..............................  Department of Commerce.
DOD..............................  Department of Defense.
DOE..............................  Department of Energy.
DOT..............................  Department of Transportation.
ED...............................  Department of Education.
EPA..............................  Environmental Protection Agency.
HHS..............................  Department of Health and Human
                                    Services.
NASA.............................  National Aeronautics and Space
                                    Administration.
NSF..............................  National Science Foundation.
USDA.............................  U.S. Department of Agriculture.
------------------------------------------------------------------------

Branch Codes

DHS Branch Codes

------------------------------------------------------------------------
              Branch                              Meaning
------------------------------------------------------------------------
ST...............................  Science and Technology Directorate.
DNDO.............................  Domestic Nuclear Detection Office.
------------------------------------------------------------------------

DOC Branch Codes

------------------------------------------------------------------------
              Branch                              Meaning
------------------------------------------------------------------------
NOAA.............................  National Oceanic and Atmospheric
                                    Administration.

[[Page 46899]]

 
NIST.............................  National Institute of Standards and
                                    Technology.
------------------------------------------------------------------------

DoD Branch Codes

------------------------------------------------------------------------
              Branch                              Meaning
------------------------------------------------------------------------
AF...............................  Department of the Air Force.
ARMY.............................  Department of the Army.
CBD..............................  Chemical and Biological Defense
                                    Program.
DARP.............................  Defense Advanced Research Projects
                                    Agency.
DHP..............................  Defense Health Program.
DLA..............................  Defense Logistics Agency.
DMEA.............................  Defense Microelectronics Activity.
DTRA.............................  Defense Threat Reduction Agency.
MDA..............................  Missile Defense Agency.
NAVY.............................  Department of the Navy.
NGA..............................  National Geospatial-Intelligence
                                    Agency.
OSD..............................  Office of the Secretary of Defense.
SOCO.............................  Special Operations Command.
------------------------------------------------------------------------

DOE Branch Codes

------------------------------------------------------------------------
              Branch                              Meaning
------------------------------------------------------------------------
ARPA.............................  Advanced Research Projects Agency--
                                    Energy.
DOE HQ...........................  Department of Energy Headquarters.
------------------------------------------------------------------------

HHS Branch Codes

------------------------------------------------------------------------
              Branch                              Meaning
------------------------------------------------------------------------
ACF..............................  Administration for Marriage and
                                    Families.
CDC..............................  Center for Disease Control.
FDA..............................  Food and Drug Administration.
NIH..............................  National Institute of Health.
------------------------------------------------------------------------

Research Institution Type Codes

------------------------------------------------------------------------
            Type code                             Meaning
------------------------------------------------------------------------
1................................  Nonprofit College or University.
2................................  Domestic Nonprofit Research
                                    Organization.
3................................  Federally Funded R&D Center (FFRDC).
------------------------------------------------------------------------

Research Institution School Categories

------------------------------------------------------------------------
         School category                          Meaning
------------------------------------------------------------------------
ANSI.............................  Alaskan Native Serving Institution.
HBCU.............................  Historically Black College or
                                    University.
HSI..............................  Hispanic Serving Institution.
TCU..............................  Tribal College or University.
NHSI.............................  Native Hawaiian Serving Institution.
------------------------------------------------------------------------

Sales Codes

------------------------------------------------------------------------
            Sales Code                            Meaning
------------------------------------------------------------------------
SF...............................  Sales to Federal or Prime Contractor.
SO...............................  Sales to Other.
SP...............................  Sales to Private Industry.
LIC..............................  Licensing Revenue.
------------------------------------------------------------------------

Additional Funding Codes

------------------------------------------------------------------------
       Additional funding code                      Meaning
------------------------------------------------------------------------
FT..................................  Fast Track.
P2E.................................  Phase II Enhancement.
P1B.................................  Phase IB.
P2A.................................  Phase IIA.
P2B.................................  Phase IIB.
P2CC................................  Phase IICC.
P2REU...............................  Phase II REU.
P2RET...............................  Phase II RET.
P2RAHSS.............................  Phase II RAHSS.
P2TECP..............................  Phase II TECP.
P2I/UCRC............................  Phase II I/UCRC Membership Grants.
P2ERC...............................  Phase II ERC Supplement.
P2CostMatch.........................  Phase II Cost Match.
Phase II Commercialization Option...  Phase II Commercialization Option.
------------------------------------------------------------------------

Investment Code

------------------------------------------------------------------------
           Investment code                          Meaning
------------------------------------------------------------------------
IA..................................  Investment from Angel Investors.
IF..................................  Investment from Federal or Prime
                                       Contractor.
IO..................................  Investment from Other.
IS..................................  Investment from the Small Business
                                       Concern itself.
------------------------------------------------------------------------

Appendix III: Solicitations Database

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                   Public
       Solicitation field name          Reporting mechanism       Agency interaction      Collection frequency    data  (Y/              Type
                                                                                                                     N)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                   Solicitation Level
--------------------------------------------------------------------------------------------------------------------------------------------------------
Solicitation program................  Agencies report on Tech- Automatic or manual      within 5 days of                 Y   varchar(4).
                                       Net.                     input.                   solicitation release
                                                                                         date.
Solicitation year...................  Agencies report on Tech- Automatic or manual      within 5 days of                 Y   int(11).
                                       Net.                     input.                   solicitation release
                                                                                         date.
Solicitation number.................  Agencies report on Tech- Automatic or manual      within 5 days of                 Y   varchar(25).
                                       Net.                     input.                   solicitation release
                                                                                         date.
Solicitation release................  Agencies report on Tech- Automatic or manual      within 5 days of                 Y   varchar(20).
                                       Net.                     input.                   solicitation release
                                                                                         date.
Solicitation open date..............  Agencies report on Tech- Automatic or manual      within 5 days of                 Y   varchar(20).
                                       Net.                     input.                   solicitation release
                                                                                         date.
Solicitation close date.............  Agencies report on Tech- Automatic or manual      within 5 days of                 Y   varchar(20).
                                       Net.                     input.                   solicitation release
                                                                                         date.
Solicitation title..................  Agencies report on Tech- Automatic or manual      within 5 days of                 Y   longtext.
                                       Net.                     input.                   solicitation release
                                                                                         date.
Solicitation body...................  Agencies report on Tech- Automatic or manual      within 5 days of                 Y   longtext.
                                       Net.                     input.                   solicitation release
                                                                                         date.
Solicitation phase..................  Agencies report on Tech- Automatic or manual      within 5 days of                 Y   int(11).
                                       Net.                     input.                   solicitation release
                                                                                         date.
Solicitation occurrence number......  Agencies report on Tech- Automatic or manual      within 5 days of                 Y   int(11).
                                       Net.                     input.                   solicitation release
                                                                                         date.
Solicitation url....................  Agencies report on Tech- Automatic or manual      within 5 days of                 Y   varchar(2048).
                                       Net.                     input.                   solicitation release
                                                                                         date.
Solicitation url title..............  Agencies report on Tech- Automatic or manual      within 5 days of                 Y   varchar(255).
                                       Net.                     input.                   solicitation release
                                                                                         date.
Solicitation url attributes.........  Agencies report on Tech- Automatic or manual      within 5 days of                 Y   mediumtext.
                                       Net.                     input.                   solicitation release
                                                                                         date.
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 46900]]

 
                                                                       Topic Level
--------------------------------------------------------------------------------------------------------------------------------------------------------
Topic title.........................  Agencies report on Tech- Automatic or manual      within 5 days of                 Y   longtext.
                                       Net.                     input.                   solicitation release
                                                                                         date.
Topic number........................  Agencies report on Tech- Automatic or manual      within 5 days of                 Y   varchar(30).
                                       Net.                     input.                   solicitation release
                                                                                         date.
Associated solicitation.............  Agencies report on Tech- Automatic or manual      within 5 days of                Y.
                                       Net.                     input.                   solicitation release
                                                                                         date.
--------------------------------------------------------------------------------------------------------------------------------------------------------

Appendix IV: Company Registry Database

----------------------------------------------------------------------------------------------------------------
                                                                                                        Public
    Company registry field name     Reporting  mechanism   Agency interaction        Collection        data  (Y/
                                                                                      frequency           N)
----------------------------------------------------------------------------------------------------------------
Agency Tracking .........  Company reports data  Receives pdf from     Register or                   N
                                     to SBA.               Company.              reconfirm at time
                                                                                 of application.
SBA Firm ID.......................  Company reports data  Receives pdf from     Register or                   N
                                     to SBA.               Company.              reconfirm at time
                                                                                 of application.
Company URL.......................  Company reports data  Receives pdf from     Register or                   N
                                     to SBA.               Company.              reconfirm at time
                                                                                 of application.
HQ Address 1......................  Company reports data  Receives pdf from     Register or                   N
                                     to SBA.               Company.              reconfirm at time
                                                                                 of application.
HQ Address 2......................  Company reports data  Receives pdf from     Register or                   N
                                     to SBA.               Company.              reconfirm at time
                                                                                 of application.
HQ City...........................  Company reports data  Receives pdf from     Register or                   N
                                     to SBA.               Company.              reconfirm at time
                                                                                 of application.
HQ Zip Code.......................  Company reports data  Receives pdf from     Register or                   N
                                     to SBA.               Company.              reconfirm at time
                                                                                 of application.
HQ Zip Code +4....................  Company reports data  Receives pdf from     Register or                   N
                                     to SBA.               Company.              reconfirm at time
                                                                                 of application.
HQ State..........................  Company reports data  Receives pdf from     Register or                   N
                                     to SBA.               Company.              reconfirm at time
                                                                                 of application.
Company Name......................  Company reports data  Receives pdf from     Register or                   N
                                     to SBA.               Company.              reconfirm at time
                                                                                 of application.
Number of Employees...............  XML or manual upload  Agency collects       Register or                   N
                                     to Tech-Net.          data, provides to     reconfirm at time
                                                           SBA. Also updated     of application.
                                                           as a part of
                                                           commercialization
                                                           information.
Flag for External Funding.........  Company reports data  Receives pdf from     Register or                   N
                                     to SBA.               Company.              reconfirm at time
                                                                                 of application.
Investment Ownership Percentage...  Company reports data  Receives pdf from     Register or                   N
                                     to SBA.               Company.              reconfirm at time
                                                                                 of application.
Majority-Owned by External Funding  Company reports data  Receives pdf from     Register or                   N
 Firms.                              to SBA.               Company.              reconfirm at time
                                                                                 of application.
Affiliate Name....................  XML or manual upload  Agency collects       Register or                   N
                                     to Tech-Net.          data, provides to     reconfirm at time
                                                           SBA.                  of application.
Affiliate Address 1...............  XML or manual upload  Agency collects       Register or                   N
                                     to Tech-Net.          data, provides to     reconfirm at time
                                                           SBA.                  of application.
Affiliate Address 2...............  XML or manual upload  Agency collects       Register or                   N
                                     to Tech-Net.          data, provides to     reconfirm at time
                                                           SBA.                  of application.
Affiliate City....................  XML or manual upload  Agency collects       Register or                   N
                                     to Tech-Net.          data, provides to     reconfirm at time
                                                           SBA.                  of application.
Affiliate Zip Code................  XML or manual upload  Agency collects       Register or                   N
                                     to Tech-Net.          data, provides to     reconfirm at time
                                                           SBA.                  of application.
Affiliate Zip Code + 4............  XML or manual upload  Agency collects       Register or                   N
                                     to Tech-Net.          data, provides to     reconfirm at time
                                                           SBA.                  of application.
Affiliate Number of Employees.....  XML or manual upload  Agency collects       Register or                   N
                                     to Tech-Net.          data, provides to     reconfirm at time
                                                           SBA.                  of application.
Additional Funding Type...........  XML or manual upload  Agency collects       Register or                   N
                                     to Tech-Net.          data, provides to     reconfirm at time
                                                           SBA.                  of application.
Additional Funding Amount.........  XML or manual upload  Agency collects       Register or                   N
                                     to Tech-Net.          data, provides to     reconfirm at time
                                                           SBA.                  of application.
Investment Type [VC, Hedge, PE]...  Company reports data  Receives pdf from     Register or                   N
                                     to SBA.               Company.              reconfirm at time
                                                                                 of application.
Investment Firm Name..............  Company reports data  Receives pdf from     Register or                   N
                                     to SBA.               Company.              reconfirm at time
                                                                                 of application.
Investment Not U.S.-Based.........  Company reports data  Receives pdf from     Register or                   N
                                     to SBA.               Company.              reconfirm at time
                                                                                 of application.

[[Page 46901]]

 
Investment Amount.................  Company reports data  Receives pdf from     Register or                   N
                                     to SBA.               Company.              reconfirm at time
                                                                                 of application.
----------------------------------------------------------------------------------------------------------------

Appendix V: Application Information Database

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                              Public
    Application info field name        Reporting mechanism     Agency interaction     Collection frequency   data  (Y/                Type
                                                                                                                N)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Company Name.......................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Program [SBIR/STTR]................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Agency Tracking ..........  XML or manual upload    Agency creates this     Quarterly............          N   ................................
                                      to Tech-Net.            number for tracking--
                                                              not submitted by SBC.
SBA Firm ID........................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Agency.............................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Solicitation Number................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Solicitation Topic Number..........  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Contact First Name.................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Contact Middle Name................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Contact Last Name..................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Contact Title......................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Contact Phone......................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Contact Email......................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Phase Number.......................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Solicitation Close Date............  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Solicitation Year..................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Company URL........................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Solicitation Topic.................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Address 1..........................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Address 2..........................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
City...............................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Zip Code...........................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Zip Code +4........................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
State..............................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
HubZone Certified..................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
SDB................................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Women-Owned........................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Women PI...........................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Socially and Economically            XML or manual upload    Agency collects data,   Quarterly............          N   ................................
 Disadvantaged PI.                    to Tech-Net.            provides to SBA.

[[Page 46902]]

 
Student/Faculty Owned..............  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
FAST Assistance....................  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Allow EDO's to Have Contact Info...  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Agency Contact First Name..........  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Agency Contact Middle Name.........  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Agency Contact Last Name...........  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Agency Contact Title...............  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Agency Contact Phone .....  XML or manual upload    Agency collects data,   Quarterly............          N   ................................
                                      to Tech-Net.            provides to SBA.
Agency Contact Email...............  XML or manual upload    Agency collects data,   Quarterly............          N   int(10) unsigned.
                                      to Tech-Net.            provides to SBA.
Key Individual Percentage of Effort  XML or manual upload    Agency collects data,   Quarterly............          N   varchar(4).
                                      to Tech-Net.            provides to SBA.
Project Aims.......................  XML or manual upload    Agency collects data,   Quarterly............          N   varchar(50).
                                      to Tech-Net.            provides to SBA.
Abstract...........................  XML or manual upload    Agency collects data,   Quarterly............          N   int(10) unsigned.
                                      to Tech-Net.            provides to SBA.
Key Individual Name................  XML or manual upload    Agency collects data,   Quarterly............          N   int(10) unsigned.
                                      to Tech-Net.            provides to SBA.
Key Individual Position/Title......  XML or manual upload    Agency collects data,   Quarterly............          N   int(10) unsigned.
                                      to Tech-Net.            provides to SBA.
Key Individual Email...............  XML or manual upload    Agency collects data,   Quarterly............          N   varchar(20).
                                      to Tech-Net.            provides to SBA.
Key Individual Phone...............  XML or manual upload    Agency collects data,   Quarterly............          N   varchar(25).
                                      to Tech-Net.            provides to SBA.
RIName.............................  XML or manual upload    Agency collects data,   60 days from time of           N   varchar(1).
                                      to Tech-Net.            provides to SBA.        solicitation close.
RIType.............................  XML or manual upload    Agency collects data,   60 days from time of           N   varchar(35).
                                      to Tech-Net.            provides to SBA.        solicitation close.
RIAddress 1........................  XML or manual upload    Agency collects data,   60 days from time of           N   varchar(40).
                                      to Tech-Net.            provides to SBA.        solicitation close.
RIAddress 2........................  XML or manual upload    Agency collects data,   60 days from time of           N   varchar(255).
                                      to Tech-Net.            provides to SBA.        solicitation close.
RICity.............................  XML or manual upload    Agency collects data,   60 days from time of           N   varchar(255).
                                      to Tech-Net.            provides to SBA.        solicitation close.
RIZip Code.........................  XML or manual upload    Agency collects data,   60 days from time of           N   int(11).
                                      to Tech-Net.            provides to SBA.        solicitation close.
RIZip Code +4......................  XML or manual upload    Agency collects data,   60 days from time of           N   varchar(20).
                                      to Tech-Net.            provides to SBA.        solicitation close.
RIState............................  XML or manual upload    Agency collects data,   60 days from time of           N   int(11).
                                      to Tech-Net.            provides to SBA.        solicitation close.
RI--Officer--First--Name...........  XML or manual upload    Agency collects data,   60 days from time of           N   varchar(255).
                                      to Tech-Net.            provides to SBA.        solicitation close.
RI--Officer--Middle--Name..........  XML or manual upload    Agency collects data,   60 days from time of           N   int(10) unsigned.
                                      to Tech-Net.            provides to SBA.        solicitation close.
RI--Officer--Last--Name............  XML or manual upload    Agency collects data,   60 days from time of           N   ................................
                                      to Tech-Net.            provides to SBA.        solicitation close.
RI--Officer--Phone.................  XML or manual upload    Agency collects data,   60 days from time of           N   ................................
                                      to Tech-Net.            provides to SBA.        solicitation close.
--------------------------------------------------------------------------------------------------------------------------------------------------------

Appendix VI: Award Information Database

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                              Public
          Award field name             Reporting mechanism     Agency interaction     Collection frequency   data  (Y/                Type
                                                                                                                N)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Phase..............................  XML or manual upload    Agency collects data,   Monthly..............          Y   int(11).
                                      to Tech-Net.            provides to SBA.
Phase II # [if 1st or 2nd].........  XML or manual upload    Agency collects data,   Quarterly............          Y   ................................
                                      to Tech-Net.            provides to SBA.
Contract #/Grant #.................  XML or manual upload    Agency collects data,   Quarterly............          Y   varchar(255).
                                      to Tech-Net.            provides to SBA.

[[Page 46903]]

 
Amount.............................  XML or manual upload    Agency collects data,   Quarterly............          Y   decimal(20,2).
                                      to Tech-Net.            provides to SBA.
SBC--Proceeds......................  XML or manual upload    Agency collects data,   Monthly..............          Y   int(11).
                                      to Tech-Net.            provides to SBA.
RI--Proceeds.......................  XML or manual upload    Agency collects data,   Monthly..............          Y   int(11).
                                      to Tech-Net.            provides to SBA.
Third--Party--Proceeds.............  XML or manual upload    Agency collects data,   Monthly..............          Y   int(11).
                                      to Tech-Net.            provides to SBA.
SttrInitiatedCollaboration.........  XML or manual upload    Agency collects data,   Monthly..............          Y   ................................
                                      to Tech-Net.            provides to SBA.
SttrInitiatedTechnology............  XML or manual upload    Agency collects data,   Monthly..............          Y   ................................
                                      to Tech-Net.            provides to SBA.
SttrMonthstoAgreement..............  XML or manual upload    Agency collects data,   Monthly..............          Y   ................................
                                      to Tech-Net.            provides to SBA.
Year...............................  XML or manual upload    Agency collects data,   Quarterly............          Y   int(11).
                                      to Tech-Net.            provides to SBA.
First Date of PoP..................  XML or manual upload    Agency collects data,   Quarterly............          Y   varchar(20).
                                      to Tech-Net.            provides to SBA.
Notification of Selection Date.....  XML or manual upload    Agency collects data,   Quarterly............          Y   varchar(20).
                                      to Tech-Net.            provides to SBA.
Award Title........................  XML or manual upload    Agency collects data,   Quarterly............          Y   longtext.
                                      to Tech-Net.            provides to SBA.
Last Day of PoP....................  XML or manual upload    Agency collects data,   Quarterly............          Y   varchar(20).
                                      to Tech-Net.            provides to SBA.
Associated Applicant/Proposal #....  XML or manual upload    Agency collects data,   Quarterly............          Y   int(10) unsigned.
                                      to Tech-Net.            provides to SBA.
PI First Name......................  XML or manual upload    Agency collects data,   Quarterly............          Y   varchar(25).
                                      to Tech-Net.            provides to SBA.
PI Middle Name.....................  XML or manual upload    Agency collects data,   Quarterly............          Y   varchar(1).
                                      to Tech-Net.            provides to SBA.
PI Last Name.......................  XML or manual upload    Agency collects data,   Quarterly............          Y   varchar(35).
                                      to Tech-Net.            provides to SBA.
PI Title...........................  XML or manual upload    Agency collects data,   Quarterly............          Y   varchar(40).
                                      to Tech-Net.            provides to SBA.
PI Phone...........................  XML or manual upload    Agency collects data,   Quarterly............          Y   varchar(255).
                                      to Tech-Net.            provides to SBA.
PI Email...........................  XML or manual upload    Agency collects data,   Quarterly............          Y   varchar(255).
                                      to Tech-Net.            provides to SBA.
ITAR Controlled....................  XML or manual upload    Agency collects data,   Quarterly............          Y   varchar(1).
                                      to Tech-Net.            provides to SBA.
Manufacturing......................  XML or manual upload    Agency collects data,   Quarterly............          Y   longtext.
                                      to Tech-Net.            provides to SBA.
Renewable Energy...................  XML or manual upload    Agency collects data,   Quarterly............          Y   varchar(1).
                                      to Tech-Net.            provides to SBA.
Comments [Free Text Field for        XML or manual upload    Agency collects data,   Quarterly............          Y   longtext.
 Notes].                              to Tech-Net.            provides to SBA.
CAGE #.............................  XML or manual upload    Agency collects data,   Quarterly............          Y   varchar(5).
                                      to Tech-Net.            provides to SBA.
DUNS #.............................  XML or manual upload    Agency collects data,   Quarterly............          Y   varchar(9).
                                      to Tech-Net.            provides to SBA.
EIN................................  XML or manual upload    Agency collects data,   Quarterly............          N   varchar(10).
                                      to Tech-Net.            provides to SBA.
RI--EIN............................  XML or manual upload    Agency collects data,   Monthly..............          Y   varchar(10).
                                      to Tech-Net.            provides to SBA.
Award Amount Justification, if       XML or manual upload    Agency collects data,   Quarterly............          N   ................................
 Limit Exceeded.                      to Tech-Net.            provides to SBA.
Convicted or Civilly Liable Flag...  XML or manual upload    Agency collects data,   At time of                     N   ................................
                                      to Tech-Net.            provides to SBA.        application.
CL First Name......................  XML or manual upload    Agency collects data,   At time of                     N   ................................
                                      to Tech-Net.            provides to SBA.        application.
CL Middle Name.....................  XML or manual upload    Agency collects data,   At time of                     N   ................................
                                      to Tech-Net.            provides to SBA.        application.
CL Last Name.......................  XML or manual upload    Agency collects data,   At time of                     N   ................................
                                      to Tech-Net.            provides to SBA.        application.
CL Company Associated..............  XML or manual upload    Agency collects data,   At time of                     N   ................................
                                      to Tech-Net.            provides to SBA.        application.
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Award data is inclusive of ``Applicant'' data fields.


[[Page 46904]]

Appendix VII: Commercialization Database

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                              Public
    Commercialization field name       Reporting mechanism     Agency interaction     Collection frequency   data  (Y/                Type
                                                                                                                N)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              Firm Level Commercialization
--------------------------------------------------------------------------------------------------------------------------------------------------------
Company Name.......................  Agencies + companies    XML or manual upload    1) In real time 2)             N   int(10) unsigned.
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Agency Tracking #..................  Agencies + companies    XML or manual upload    1) In real time 2)             N   int(10) unsigned.
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
SBA Firm ID........................  Agencies + companies    XML or manual upload    1) In real time 2)             N   int(10) unsigned.
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
IPO................................  Agencies + companies    XML or manual upload    1) In real time 2)             N   YES/NO.
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
IPO Value..........................  Agencies + companies    XML or manual upload    1) In real time 2)             N   int(11).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
IPO Amount.........................  Agencies + companies    XML or manual upload    1) In real time 2)             N   decimal(20,2).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
IPO Year...........................  Agencies + companies    XML or manual upload    1) In real time 2)             N   int(11).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Merger/Acquired....................  Agencies + companies    XML or manual upload    1) In real time 2)             N   YES/NO.
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
M&A Value..........................  Agencies + companies    XML or manual upload    1) In real time 2)             N   decimal(20,2).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
M&A Year...........................  Agencies + companies    XML or manual upload    1) In real time 2)             N   int(11).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Narrative..........................  Agencies + companies    XML or manual upload    1) In real time 2)             N   longtext.
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Comm Contact First Name............  Agencies + companies    XML or manual upload    1) In real time 2)             N   varchar(25).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Comm Contact Middle Name...........  Agencies + companies    XML or manual upload    1) In real time 2)             N   varchar(1).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Comm Contact Last Name.............  Agencies + companies    XML or manual upload    1) In real time 2)             N   varchar(35).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Comm Contact Title.................  Agencies + companies    XML or manual upload    1) In real time 2)             N   varchar(50).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Comm Contact Phone.................  Agencies + companies    XML or manual upload    1) In real time 2)             N   varchar(255).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.

[[Page 46905]]

 
Comm Contact Email.................  Agencies + companies    XML or manual upload    1) In real time 2)             N   varchar(255).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Sales Amount.......................  Agencies + companies    XML or manual upload    1) In real time 2)             N   decimal(20,2).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
SttrPercentSbc.....................  Agencies + companies    XML or manual upload    1) In real time 2)             N   int(11).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
SttrPercentRi......................  Agencies + companies    XML or manual upload    1) In real time 2)             N   int(11).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Investment Amount..................  Agencies + companies    XML or manual upload    1) In real time 2)             N   decimal(20,2).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Patent #'s.........................  Agencies + companies    XML or manual upload    1) In real time 2)             N   int(11).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Number of Patents..................  Agencies + companies    XML or manual upload    1) In real time 2)             N   decimal(10,2).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Investment Types...................  Agencies + companies    XML or manual upload    1) In real time 2)             N   ................................
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Sales Type.........................  Agencies + companies    XML or manual upload    1) In real time 2)             N   ................................
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              Award Level Commercialization
--------------------------------------------------------------------------------------------------------------------------------------------------------
Product Launched...................  Agencies + companies    XML or manual upload    1) In real time 2)             N   int(11).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Names of Company Established for     Agencies + companies    XML or manual upload    1) In real time 2)             N   int(11).
 Product/Commercialization.           report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Sales Amount.......................  Agencies + companies    XML or manual upload    1) In real time 2)             N   int(10) unsigned.
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Investment Amount..................  Agencies + companies    XML or manual upload    1) In real time 2)             N   int(11).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Patent #'s.........................  Agencies + companies    XML or manual upload    1) In real time 2)             N   longtext.
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Number of Patents..................  Agencies + companies    XML or manual upload    1) In real time 2)             N   int(11).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Investment Types...................  Agencies + companies    XML or manual upload    1) In real time 2)             N   int(11).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Sales Type.........................  Agencies + companies    XML or manual upload    1) In real time 2)             N   int(11).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.

[[Page 46906]]

 
Phase III Value....................  Agencies + companies    XML or manual upload    1) In real time 2)             N   int(10) unsigned.
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Phase III Launched/Implemented       Agencies + companies    XML or manual upload    1) In real time 2)             N   int(11).
 [CRP].                               report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
Phase III Narrative [CRP]..........  Agencies + companies    XML or manual upload    1) In real time 2)             N   int(11).
                                      report to Tech-Net.     to Tech-Net.            SBC updates prior to
                                                                                      subsequent award
                                                                                      application.
--------------------------------------------------------------------------------------------------------------------------------------------------------

Appendix VIII: Annual Report Database

----------------------------------------------------------------------------------------------------------------
                                     Reporting          Collection        Public
    Annual report field name         mechanism           frequency         data                 Type
----------------------------------------------------------------------------------------------------------------
agency code....................  XML or manual      Annually..........          Y   int(11).
                                  upload to Tech-
                                  Net.
Program........................  XML or manual      Annually..........          Y   char(4).
                                  upload to Tech-
                                  Net.
Year...........................  XML or manual      Annually..........          Y   char(4).
                                  upload to Tech-
                                  Net.
reporting unit.................  XML or manual      Annually..........          Y   varchar(255)
                                  upload to Tech-
                                  Net.
submitted by...................  XML or manual      Annually..........          Y   varchar(100).
                                  upload to Tech-
                                  Net.
phone number...................  XML or manual      Annually..........          Y   varchar(255).
                                  upload to Tech-
                                  Net.
Agency Extramural Budget.......  XML or manual      Annually..........          Y   varchar(100).
                                  upload to Tech-
                                  Net.
Agency SBIR Budget.............  XML or manual      Annually..........          Y   varchar(100).
                                  upload to Tech-
                                  Net.
Number of Solicitations          XML or manual      Annually..........          Y   int(6).
 Released.                        upload to Tech-
                                  Net.
Number of Research Topics in     XML or manual      Annually..........          Y   ............................
 Solicitations.                   upload to Tech-
                                  Net.
Number of Phase I Proposals      XML or manual      Annually..........          Y   int(6).
 Received.                        upload to Tech-
                                  Net.
Total Phase I Awards...........  XML or manual      Annually..........          Y   int(6).
                                  upload to Tech-
                                  Net.
Total Phase I Dollars Awarded    XML or manual      Annually..........          Y   varchar(25).
 ($).                             upload to Tech-
                                  Net.
Total Phase I Dollars to SBCs..  XML or manual      Annually..........          Y   int(6).
                                  upload to Tech-
                                  Net.
Total Phase I Dollars to RIs...  XML or manual      Annually..........          Y   int(6).
                                  upload to Tech-
                                  Net.
Total Phase I Dollars to RI--    XML or manual      Annually..........          Y   int(6).
 Universities.                    upload to Tech-
                                  Net.
Total Phase I Awards to RI--     XML or manual      Annually..........          Y   int(6).
 Universities.                    upload to Tech-
                                  Net.
Total Phase I Dollars to RI--    XML or manual      Annually..........          Y   int(6).
 FFRDCs.                          upload to Tech-
                                  Net.
Total Phase I Awards to RI--     XML or manual      Annually..........          Y   int(6).
 FFRDCs.                          upload to Tech-
                                  Net.
Total Phase I Dollars to RI--    XML or manual      Annually..........          Y   int(6).
 Non-Profit R&D.                  upload to Tech-
                                  Net.
Total Phase I Awards to RI--Non- XML or manual      Annually..........          Y   int(6).
 Profit R&D.                      upload to Tech-
                                  Net.
Minority/Disadvantaged Phase I   XML or manual      Annually..........          Y   int(6).
 Awards.                          upload to Tech-
                                  Net.
Minority/Disadvantaged Phase I   XML or manual      Annually..........          Y   varchar(25).
 Dollars Awarded ($).             upload to Tech-
                                  Net.
HUBZone Phase I Awards.........  XML or manual      Annually..........          Y   int(6).
                                  upload to Tech-
                                  Net.
HUBZone Phase I Dollars Awarded  XML or manual      Annually..........          Y   int(6).
 ($).                             upload to Tech-
                                  Net.
phase1 hubzone dollars           XML or manual      Annually..........          Y   varchar(25).
 obligated.                       upload to Tech-
                                  Net.
phase1 manufacturing awards....  XML or manual      Annually..........          Y   int(6).
                                  upload to Tech-
                                  Net.
phase1 manufacturing dollars     XML or manual      Annually..........          Y   varchar(25).
 obligated.                       upload to Tech-
                                  Net.
Number of Phase II Proposals     XML or manual      Annually..........          Y   int(6).
 Received.                        upload to Tech-
                                  Net.
Total Phase II Awards..........  XML or manual      Annually..........          Y   int(6).
                                  upload to Tech-
                                  Net.
Total Phase II Dollars Awarded   XML or manual      Annually..........          Y   varchar(25).
 ($).                             upload to Tech-
                                  Net.
Total Phase II Dollars to SBCs.  XML or manual      Annually..........          Y   int(6).
                                  upload to Tech-
                                  Net.
Total Phase II Dollars to RIs..  XML or manual      Annually..........          Y   int(6).
                                  upload to Tech-
                                  Net.
Total Phase II Dollars to RI--   XML or manual      Annually..........          Y   int(6).
 Universities.                    upload to Tech-
                                  Net.
Total Phase II Awards to RI--    XML or manual      Annually..........          Y   int(6).
 Universities.                    upload to Tech-
                                  Net.
Total Phase II Dollars to RI--   XML or manual      Annually..........          Y   int(6).
 FFRDCs.                          upload to Tech-
                                  Net.
Total Phase II Awards to RI--    XML or manual      Annually..........          Y   int(6).
 FFRDCs.                          upload to Tech-
                                  Net.
Total Phase II Dollars to RI--   XML or manual      Annually..........          Y   int(6).
 Non-Profit R&D.                  upload to Tech-
                                  Net.
Total Phase II Awards to RI--    XML or manual      Annually..........          Y   int(6).
 Non-Profit R&D.                  upload to Tech-
                                  Net.
Minority/Disadvantaged Phase II  XML or manual      Annually..........          Y   int(6).
 Awards.                          upload to Tech-
                                  Net.
Minority/Disadvantaged Phase II  XML or manual      Annually..........          Y   varchar(25).
 Dollars Awarded ($).             upload to Tech-
                                  Net.
HUBZone Phase II Awards........  XML or manual      Annually..........          Y   int(6).
                                  upload to Tech-
                                  Net.
HUBZone Phase II Dollars         XML or manual      Annually..........          Y   int(6).
 Awarded ($).                     upload to Tech-
                                  Net.
phase2 hubzone dollars           XML or manual      Annually..........          Y   varchar(25).
 obligated.                       upload to Tech-
                                  Net.
phase2 manufacturing awards....  XML or manual      Annually..........          Y   int(6).
                                  upload to Tech-
                                  Net.
phase2 manufacturing dollars     XML or manual      Annually..........          Y   varchar(25).
 obligated.                       upload to Tech-
                                  Net.
new phase2 with dollars          XML or manual      Annually..........          Y   int(6).
 obligated.                       upload to Tech-
                                  Net.
new phase2 dollars obligated...  XML or manual      Annually..........          Y   varchar(25).
                                  upload to Tech-
                                  Net.

[[Page 46907]]

 
old phase2 with dollars          XML or manual      Annually..........          Y   int(6).
 obligated.                       upload to Tech-
                                  Net.
old phase2 dollars obligated...  XML or manual      Annually..........          Y   varchar(25).
                                  upload to Tech-
                                  Net.
number amount modified.........  XML or manual      Annually..........          Y   int(6).
                                  upload to Tech-
                                  Net.
amount modified................  XML or manual      Annually..........          Y   varchar(25).
                                  upload to Tech-
                                  Net.
agency obligations.............  XML or manual      Annually..........          Y   varchar(50).
                                  upload to Tech-
                                  Net.
phase1 success rate............  XML or manual      Annually..........          Y   varchar(3).
                                  upload to Tech-
                                  Net.
phase2 success rate............  XML or manual      Annually..........          Y   varchar(3).
                                  upload to Tech-
                                  Net.
overall success rate...........  XML or manual      Annually..........          Y   varchar(3).
                                  upload to Tech-
                                  Net.
The percentage of new phase 1    XML or manual      Annually..........          Y   varchar(3).
 awards where difference          upload to Tech-
 between Solicitation Close       Net.
 Date and Proposal Award Date
 is less than 180 days
 (ProposalAwardDate--Solicitati
 onCloseDate).
The average of the number of     XML or manual      Annually..........          Y   varchar(50).
 days between Solicitation        upload to Tech-
 Close Date and Proposal Award    Net.
 Date for all the new phase 1
 awards (ProposalAwardDate--
 SolicitationCloseDate).
The average of the number of     XML or manual      Annually..........          Y   varchar(50).
 days between the Contract End    upload to Tech-
 Date for the related phase 1     Net.
 award and the Proposal Award
 Date for all the new phase 2
 awards (P2 Proposal Award
 Date--P1 ContractEndDate).
The average number of days       XML or manual      Annually..........          Y   varchar(50).
 between Proposal Selection       upload to Tech-
 Date and Proposal Award Date     Net.
 for all the new phase 2 awards
 (ProposalAwardDate--ProposalSe
 lectionDate).
The percentage of new phase 2    XML or manual      Annually..........          Y   varchar(3).
 awards where the number of       upload to Tech-
 days between Proposal            Net.
 Selection Date and Proposal
 Award Date was less than 60
 (ProposalAwardDate--ProposalSe
 lectionDate).
sbcname changed................  XML or manual      Annually..........          Y   text.
                                  upload to Tech-
                                  Net.
one proposal per solicitation..  XML or manual      Annually..........          Y   text.
                                  upload to Tech-
                                  Net.
more than 15 awards............  XML or manual      Annually..........          Y   text.
                                  upload to Tech-
                                  Net.
justification..................  XML or manual      Annually..........          Y   text.
                                  upload to Tech-
                                  Net.
submitted......................  XML or manual      Annually..........          Y   timestamp.
                                  upload to Tech-
                                  Net.
confirmed--by--uid.............  XML or manual      Annually..........          Y   int(10) unsigned.
                                  upload to Tech-
                                  Net.
                                 XML or manual      Annually..........          Y   ............................
                                  upload to Tech-
                                  Net.
Annual Report calculations
 based on above fields
Dollars Obligated..............  XML or manual      Annually..........          Y   ............................
                                  upload to Tech-
                                  Net.
Percent of SBIR to Extramural    XML or manual      Annually..........          Y   ............................
 Budget.                          upload to Tech-
                                  Net.
Deficit/Surplus................  XML or manual      Annually..........          Y   ............................
                                  upload to Tech-
                                  Net.
Exceeding award size threshold   XML or manual      Annually..........          Y   ............................
 of 150%.                         upload to Tech-
                                  Net.
Award cross btwn SBIR and STTR   XML or manual      Annually..........          Y   ............................
 programs.                        upload to Tech-
                                  Net.
                                 XML or manual      Annually..........          Y   ............................
                                  upload to Tech-
                                  Net.
Additions to Annual Report       XML or manual      Annually..........          Y   ............................
 tracking compliance grievance.   upload to Tech-
                                  Net.
grievance tracking for data      XML or manual      Annually..........          Y   ............................
 rights.                          upload to Tech-
                                  Net.
-track deficit/surplus of        XML or manual      Annually..........          Y   ............................
 budgets, esp. VC, etc. backed.   upload to Tech-
                                  Net.
Track data at component level..  XML or manual      Annually..........          Y   ............................
                                  upload to Tech-
                                  Net.
----------------------------------------------------------------------------------------------------------------

Appendix IX--Performance Areas, Metrics and Goals

    (a) Examples of performance areas include:
    (1) company and agency-level commercialization of awards (see 
commercialization section for detail);
    (2) repeat-award winners;
    (3) outreach to first time SBIR/STTR applicants, WOSBs, SDBs--
including percentage of new applicants from those demographics that 
have applied to the agency, and other goals and metrics established 
by the agency and the interagency policy committee;
    (4) shortening review and award timelines for small businesses 
(collected annually in annual report).
    (b) Examples of metrics relating to timelines for awards of 
Phase I funding agreements and performance start dates of the 
funding agreements, include:
    (1) The percentage of Phase I awards where the duration between 
the closing date of the solicitation and the first date of the 
period of performance on the funding agreement is less than 180 
calendar days.
    (2) The average duration of time between a Phase I solicitation 
closing date and the first day of the period of performance on the 
funding agreement.
    (3) The percentage of Phase I awards where the duration between 
the closing date of the solicitation and the notification of 
recommendation of award is not more than one year for NIH or NSF and 
not more than 90 calendar days for all other agencies.
    (4) The average duration of time between a Phase I solicitation 
closing date and the notification of recommendation for award.

[[Page 46908]]

    (c) Examples of metrics relating to timelines for awards of 
Phase II funding agreements and performance start dates of the 
funding agreements, include:
    (1) The percentage of Phase II awards where the duration between 
the closing date of the solicitation, or the applicable date for 
receiving the Phase II application, and the first date of the period 
of performance on the funding agreement is the less than 180 
calendar days.
    (2) The average duration of time between a Phase II solicitation 
close dating and the first day of the period of performance on the 
funding agreement.
    (3) The percentage of Phase II awards where the duration between 
the closing date of the solicitation, or the applicable date for 
receiving the Phase II application, and the notification of 
recommendation of award is not more than one year for NIH or NSF and 
not more than 90 calendar days for all other agencies.
    (4) The average duration of time between a Phase II solicitation 
closing date, or the applicable date for receiving the Phase II 
application--and the notification of recommendation for award.
    (5) The average duration of time between the end of the period 
of performance on a Phase I funding agreement and the closing date 
for a Phase II solicitation for the same work.
    (6) The number of awardees for whom the Phase I process exceeded 
6 months, starting from the closing date of the STTR solicitation to 
award of the funding agreement.
    (7) Metrics with respect to each STTR agency's adherence to 
Policy Directive and implementation.
    (8) Metrics with respect to agencies' measures to reduce fraud, 
waste and abuse within the STTR Program and coordination with the 
STTR agency's OIG.

Appendix X--National Academy of Sciences Study

    (a) The purpose of the study is to:
    (1) Continue the most recent study relating to the following 
issues:
    (i) a review of the value to the Federal research agencies of 
the research projects being conducted under the STTR Program, and of 
the quality of research being conducted by small businesses 
participating under the program, including a comparison of the value 
of projects conducted under the STTR Program to those funded by 
other Federal research and development expenditures;
    (ii) to the extent practicable, an evaluation of the economic 
benefits achieved by the STTR Program, including the economic rate 
of return, and a comparison of the economic benefits, including the 
economic rate of return, achieved by the STTR Program with the 
economic benefits, including the economic rate of return, of other 
Federal research and development expenditures;
    (iii) an evaluation of the noneconomic benefits achieved by the 
STTR Program over the life of the program;
    (iv) an analysis of whether Federal agencies, in fulfilling 
their procurement needs, are making sufficient effort to use small 
businesses that have completed a second phase award under the STTR 
Program; and
    (2) Conduct a comprehensive study of how the STTR program has 
stimulated technological innovation and technology transfer, 
including--
    (i) a review of the collaborations created between small 
businesses and Research Institutions, including an evaluation of the 
effectiveness of the program in stimulating new collaborations and 
any obstacles that may prevent or inhibit the creation of such 
collaborations;
    (ii) an evaluation of the effectiveness of the program at 
transferring technology and capabilities developed through Federal 
funding;
    (iii) to the extent practicable, an evaluation of the economic 
benefits achieved by the STTR program, including the economic rate 
of return;
    (iv) an analysis of how Federal agencies are using small 
businesses that have completed Phase II under the STTR program to 
fulfill their procurement needs;
    (v) an analysis of whether additional funds could be employed 
effectively by the STTR program; and
    (vi) an assessment of the systems and minimum performance 
standards relating to commercialization success established under 
section 9(qq) of the Small Business Act;
    (3) Make recommendations with respect to--
    (i) measures of outcomes for strategic plans submitted under 5 
U.S.C. 306 and performance plans submitted under 31 U.S.C. 1115, of 
each Federal agency participating in the STTR Program;
    (ii) how to increase the use by the Federal Government in its 
programs and procurements of technology-oriented small businesses;
    (iii) improvements to the STTR Program, if any are considered 
appropriate; and
    (iv) how the STTR program can further stimulate technological 
innovation and technology transfer.
    (4) Estimate the number of jobs created by the SBIR or STTR 
program of the agency, to the extent practicable.

[FR Doc. 2012-18120 Filed 8-3-12; 8:45 am]
BILLING CODE 8025-01-P