To amend section 9 of the Small Business Act to extend and expand the phase flexibility authority, and for other purposes.
Legislative Progress
IntroducedMr. Olszewski introduced the following bill; which was referred to …
Summary
What This Bill Does
This bill extends and expands federal programs that provide research and development grants to small businesses. The SBIR (Small Business Innovation Research) and STTR (Small Business Technology Transfer) programs require federal agencies with large R&D budgets to set aside funding for small business grants. This bill extends these programs from 2025 to 2030 and, importantly, expands "Direct to Phase II" authority - which allows agencies to award larger grants without requiring companies to complete the smaller Phase I grants first.
Who Benefits and How
Small businesses conducting R&D work are the primary beneficiaries. Technology startups, biotech companies, defense contractors, and other small firms with proven track records can now access larger Phase II grants (typically $750,000-$1.5 million) directly from any federal agency, not just the three agencies previously authorized. The National Institutes of Health can dedicate up to 15% of its SBIR budget to these direct awards, while other agencies can use up to 10%. Universities and research institutions also benefit through extended STTR programs, which fund collaborative research with small businesses.
Who Bears the Burden and How
The burdens are minimal and primarily administrative. Federal agency heads must report on their use of Direct to Phase II authority. Some small businesses that rely heavily on Phase I grants (typically $50,000-$250,000) may face slightly increased competition as agencies shift more funding toward Direct to Phase II awards, though this effect is uncertain and likely modest.
Key Provisions
- Extends Direct to Phase II authority from 2025 to 2030, allowing agencies to skip Phase I and award larger grants directly to proven small businesses
- Expands Direct to Phase II from three agencies (NIH, DOD, Department of Education) to all federal agencies with SBIR programs
- Sets funding caps: 10% of SBIR budget for most agencies, 15% for NIH
- Extends the commercialization readiness program for civilian agencies to 2030, helping small businesses transition research to market
- Extends various SBIR and STTR pilot programs to September 30, 2030
- Requires agencies to report the number and amount of Direct to Phase II awards they make
Evidence Chain:
This summary is derived from the structured analysis below. See "Detailed Analysis" for per-title beneficiaries/burden bearers with clause-level evidence links.
Primary Purpose
Extends SBIR/STTR pilot programs from 2025 to 2030 and expands Direct to Phase II authority to all federal agencies.
Policy Domains
Legislative Strategy
"Extend and expand successful small business R&D funding mechanisms, particularly Direct to Phase II authority which allows agencies to skip Phase I and go straight to larger Phase II awards for promising projects"
Likely Beneficiaries
- Small businesses conducting R&D (especially those with proven track records that can skip Phase I)
- Technology startups seeking federal funding
- Small businesses partnering with universities and research institutions
- Federal agencies seeking flexibility in SBIR/STTR administration
Likely Burden Bearers
- Minimal direct burdens - primarily administrative (agencies must report on Direct to Phase II usage)
- Potential competitive impact on small businesses that rely on Phase I awards (if agencies shift more funding to Direct to Phase II)
Bill Structure & Actor Mappings
Who is "The Secretary" in each section?
- "nih"
- → National Institutes of Health (has special 15% limit vs standard 10%)
- "the_head"
- → Head of each federal agency administering SBIR/STTR programs
- "federal_agencies"
- → All federal agencies required to carry out SBIR programs (previously limited to NIH, DOD, and DOE for some provisions)
Key Definitions
Terms defined in this bill
Small Business Innovation Research program - federal program requiring agencies with R&D budgets over $100M to set aside funding for small business grants
Small Business Technology Transfer program - federal program promoting cooperative R&D between small businesses and research institutions
Authority allowing federal agencies to award Phase II SBIR grants without requiring Phase I completion first, subject to funding caps (10% for most agencies, 15% for NIH)
Program for civilian agencies (renamed from 'pilot program') to support commercialization of SBIR/STTR research
Various pilot initiatives under Section 9(jj) of the Small Business Act
Various pilot initiatives under Section 9(uu) of the Small Business Act
We use a combination of our own taxonomy and classification in addition to large language models to assess meaning and potential beneficiaries. High confidence means strong textual evidence. Always verify with the original bill text.
Learn more about our methodology