Friday, July 10, 2009

House Passess HR 2965 "The Enhancing Small Business Research & Innovation Act of 2009"

The U.S. House of Representatives on July 8 overwhelmingly approved legislation, HR 2965, entitled "The Enhancing Small Business Research and Innovation Act of 2009," to reauthorize the Small Business Innovation Research (SBIR) program and the Small Business Technology Transfer (STTR) program through 2011. The bill significantly boosts the dollar value of SBIR awards but decreases their number because the overall level of available grants funds was not increased. The bill would also remove a 2003 rule barring venture capital backed firms from receiving SBIR awards. There are eligibility restrictions in the House bill. For example, the House bill prevents SBIR funding to companies that: have more than 500 employees; are majority owned by just one venture firm; or have the majority of board seats held by one venture firm.

The bill would increase the amount of Phase 1 Small Business Innovation Research grants for early stage innovation to $250,000 and push SBIR Phase 2 grants to $2 million (Phase 1 grants are now $100,000; Phase 2 grants are $750,000). The House bill must now be reconciled with a Senate committee version, S.1233, the SBIR/STTR Reauthorization Act of 2009, that limits how much of the SBIR awards can go to venture capital backed firms (18 percent of National Institutes of Health grants and 8 percent of grants from the 10 other federal agencies that make SBIR awards.) The Senate version would also increase awards to $150,000 for Phase 1 grants and $1 million for Phase 2 grants, and cap at 50 percent how far above the recommended amounts the grants can go, as well as increase the overall SBIR appropriation.


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