Events in Year 2004 that Impacted the SBIR / STTR Landscape

January

• Although originally cut from the FY-2004 budget, funding for the Federal and State Technology Partnership Program (FAST) and Regional Outreach Program (ROP) are restored for FY-2004 at reduced levels.

February

• SBA Swap - Without notice or explanation, SBA moves SBIR expert Maurice Swinton from his position as Assistant Administrator for the Office of Technology (SBIR/STTR program), to become Assistant Administrator for the Office of Management and Technical Assistance (7j program), replacing Edsel Brown Jr.   Brown is moved to Swinton's previous position as Assistant Administrator for the Office of Technology (SBIR).
• President Bush issues Executive Order 13329, Encouraging Innovation in Manufacturing. In short, this EO directs the SBIR/STTR programs to give high priority to manufacturing-related research and development.
• Eight Senators on the Senate Small Business and Entrepreneurship Committee sent a letter to SBA Administrator Hector Barreto to express the committee's concerns about the SBA's proposed elimination of the FAST and ROP programs for FY-2005. They also inquired as to the status of the FY-2004 FAST and ROP program that Congress restored funding for, and urged that swift action be taken to publish the request for proposals (RFPs) and get the program underway.

March

• DoD adds a third SBIR solicitation (FY-2004.3) and announces a fourth SBIR solicitation (FY-2004.4).
• SBA releases FAST program announcement.

April

• The Navy, as part of the DoD's SBIR FY-2004.2, adds three special SBIR Quick Response Topics. The Quick Response Topics rules were slightly different in that: Small businesses shall apply first for a three to six-month phase I award of up to $100,000 (with no option) to test the scientific, technical, and commercial merit of a particular concept. If phase I proves successful, the firm may be invited to apply for a phase II award of up to $1,000,000 to further develop the concept.
• Powerful lobbyists succeed in getting a bill introduced into the House (H. R. 4149) in order to try to change the eligibility rules to allow VCs and/or employee benefit or pension plans to have majority ownership and control of a small business competing for SBIR funding. The bill is not acted upon in the 108th Congress.
• SBA releases ROP program announcement.

May

• Powerful lobbyists succeed in getting a similar bill introduced into the Senate (S. 2384) in order to try to change the eligibility rules to allow VCs and/or employee benefit or pension plans to have majority ownership and control of a small business competing for SBIR funding. The bill is not acted upon in the 108th Congress.
• SBA Office of Size Standards withdraws its proposed rule change.

June

• USDA incurs a 3 week delay in the release of their FY-2005 SBIR solicitation.

July

• NIH awards a $2.5 million dollar contract to Larta Institute for a nationwide SBIR commercialization assistance program for the National Institutes of Health.

August

• Vinny Schaper, Navy SBIR program manager, retires after many years of service to the Navy and small businesses. John Williams, Navy STTR program manager becomes Navy SBIR program manager.

September

• QinetiQ, Britain's largest technology research and design company acquires one of the top perennial SBIR award winners, Foster-Miller. Foster-Miller will retain its name, but operate as a subsidiary of QinetiQ. Future participation in SBIR is unclear.

October

• SBA Announces FAST and ROP award winners. Although the funding is from FY-2004 funds, the work program will take place in FY-2005.

November

• Milton D. Stewart passes away, succumbs to pneumonia at age 82. Stewart was one of the most important figures in the establishment of small business advocacy and SBIR. {more...]
• HSARPA incurs 1 month delay in the prerelease of their FY-2005.1 SBIR offering.
• Powerful Biotech/VC lobbyists try to have their eligibility language inserted into SBA Reauthorization bill. Action would bypass hearings and/or public comment.
• Grassroots efforts by Chris Busch, Gene Watson and others result in letter writing campaign by many small businesses to their Senators in rural states such as Wyoming, Idaho and Montana. The small businesses were urging their Senators to hold hearings on the eligibility exemption issues sought by the large VC/Bio lobbyists.

December

• SBA Issues new SBIR eligibility final rule. In short, this rule change allows SBIR eligibility for small businesses that are majority owned and controlled by other entities, as long as the majority ownership and controlling entity meets the SBA's size standard of a small business (owned and controlled by US citizens and/or permanent resident aliens, and having an aggregate of 500 or fewer employees/affiliates).
• SBA solicits comments in their Advance Notice of Proposed Rulemaking. The subject is SBA size standards for all SBA programs, but includes a section that pertains only to VCs wanting size exemption for eligibility in the SBIR program. All comments must be received by February 1, 2005.
• The Consolidated Appropriations Act, 2005 is passed by Congress (PL 108-447). Section K of this act, known as the Small Business Reauthorization and Manufacturing Assistance Act of 2004, provides the funding for the SBA. VC exemption language was not added to the bill.
• VC exemption language was not added to the legislation, but informed sources state that it will be brought up again early in the 109th congress.