119-hr4777

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4777 Introduced in House

    (IH) ]

<DOC>

119th CONGRESS
 1st Session
 H. R. 4777

To improve the SBIR and STTR programs under the Small Business Act, and 
 for other purposes.

_______________________________________________________________________

 IN THE HOUSE OF REPRESENTATIVES

 July 25, 2025

Mr. Williams of Texas introduced the following bill; which was referred 
to the Committee on Small Business, and in addition to the Committee on 
 Science, Space, and Technology, for a period to be subsequently 
 determined by the Speaker, in each case for consideration of such 
 provisions as fall within the jurisdiction of the committee concerned

_______________________________________________________________________

 A BILL

To improve the SBIR and STTR programs under the Small Business Act, and 
 for other purposes.

 Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Investing in 
National Next-Generation Opportunities for Venture Acceleration and 
Technological Excellence'' or the ``INNOVATE Act''.

    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents.

Sec. 2. Definitions.
 TITLE I--PROMOTING TRANSITION FOR BATTLE-READY TECHNOLOGIES

Sec. 101. Enhancing small business success in the STTR program.

Sec. 102. Phase II strategic breakthrough funding.

Sec. 103. Implementation briefings.

Sec. 104. Fixed-price contracts.
 TITLE II--ENCOURAGING SMALL BUSINESS INNOVATION IN ALL OF AMERICA

Sec. 201. Encouraging new SBIR and STTR entrants.

Sec. 202. Combating discriminatory practices in the SBIR and STTR 
 programs.

Sec. 203. Disclosures and prohibitions relating to certain agreements 
 with entities engaging in censorship.

Sec. 204. Connecting SBIR and STTR awardees and small business 
 investment companies.

Sec. 205. Agency outreach to rural communities.
 TITLE III--STREAMLINING PARTICIPATION IN THE SBIR AND STTR PROGRAMS

Sec. 301. Amendments relating to open topics.

Sec. 302. Reducing administrative burden.
 TITLE IV--PROTECTING AMERICAN INNOVATION FROM ADVERSARIAL INFLUENCE

Sec. 401. Definition of foreign risk.

Sec. 402. Bolstering research security of SBIR and STTR awards.

Sec. 403. Strengthening the due diligence program to assess security 
 risks.

Sec. 404. Strengthening agency recovery authority.

Sec. 405. Best practices on investor informational rights.

Sec. 406. GAO report.
 TITLE V--SIMPLIFYING SBIR-STTR STANDARDS

Sec. 501. Improving direct to Phase II authorities.

Sec. 502. Improving SBIR and STTR data collection.

Sec. 503. Streamlining program administration.

Sec. 504. Extending SBIR and STTR authorization.
 TITLE VI--MISCELLANEOUS

Sec. 601. Technical amendments.

Sec. 602. Repeals.

Sec. 603. Severability.

SEC. 2. DEFINITIONS.

 In this Act, the terms ``Phase I'', ``Phase II'', ``Phase III'', 
``SBIR'', and ``STTR'' have the meanings given those terms in 

section 9

    (e) of the Small Business Act (15 U.S.C. 638

    (e) ).

 TITLE I--PROMOTING TRANSITION FOR BATTLE-READY TECHNOLOGIES

SEC. 101. ENHANCING SMALL BUSINESS SUCCESS IN THE STTR PROGRAM.

 

Section 9 of the Small Business Act (15 U.S.C. 638 et seq.) is 
amended--

    (1) in subsection

    (e)

    (7) --
        (A) by striking ``40'' and inserting ``50''; and
        (B) by striking ``30'' and inserting ``20'';

    (2) in subsection

    (f)

    (1) --
        (A) in subparagraph
        (H) , by striking ``and'' at the 
 end;
        (B) in subparagraph
            (I) , by striking ``and each 
 fiscal year thereafter,'' and inserting ``; and''; and
            (C) by adding at the end the following:
 ``
        (J) not less than 3.45 percent of such budget in 
 fiscal year 2026 and every year thereafter,''; and

    (3) in subsection

    (n)

    (1)
        (B) --
        (A) in clause
            (iv) , by striking ``and'' at the end;
        (B) in clause
            (v) , by striking ``and each fiscal 
 year thereafter.'' and inserting ``; and''; and
            (C) by adding at the end the following:
 ``
            (vi) not less than 0.20 percent for 
 fiscal year 2026 and each fiscal year 
 thereafter.''.

SEC. 102. PHASE II STRATEGIC BREAKTHROUGH FUNDING.

    (a) In General.--

Section 9 of the Small Business Act (15 U.S.C. 
638) is amended--

    (1) in subsection

    (aa) , by adding at the end the following:
 ``

    (6) Strategic breakthrough allocation.--Participating 
 agencies with a budget for SBIR greater than $100,000,000 shall 
 not be required to receive a waiver from the Administrator to 
 award a small business concern not more than $30,000,000 when 
 using funds made available under a strategic breakthrough 
 allocation (as defined in subsection

    (ff) ).''; and

    (2) in subsection

    (ff) --
        (A) in the subsection heading, by striking ``and 
 STTR'' and inserting ``Phase II'';
        (B) in paragraph

    (1) , by striking ``or Phase II 
 STTR award''; and
            (C) by adding at the end the following new 
 paragraph:
 ``

    (3) Strategic breakthrough awards.--
 ``
        (A) Award.--Under this subparagraph, a funding 
 agreement may be awarded to a small business concern by 
 each participating agency using funds made available 
 under a strategic breakthrough allocation, as defined 
 in subparagraph
        (B) .
 ``
        (B) Fund parameters.--
 ``
            (i) Strategic breakthrough allocation 
 defined.--In this subparagraph, the term 
 `strategic breakthrough allocation' means, with 
 respect to a participating agency with a 
 required expenditure under subsection

    (f)

    (1) in 
 excess of $100,000,000, a required expenditure 
 amount from the SBIR allocation under 
 subsection

    (f)

    (1) of such agency of not less 
 than 0.25 percent of the extramural budget for 
 research or research and development designated 
 for such agency for fiscal year 2026 and every 
 fiscal year thereafter.
 ``
            (ii) Requirements.--In the case of a 
 Phase II agreement that is awarded to a small 
 business concern by a participating agency 
 using funds made available under a strategic 
 breakthrough allocation, the following 
 requirements shall apply:
 ``
            (I) Award size and period of 
 performance.--A participating agency 
 may award from a strategic breakthrough 
 allocation not more than $30,000,000 in 
 aggregate to a small business concern, 
 including its affiliates, spinouts, or 
 subsidiaries based on reaching 
 production or development milestone if 
 the total period of performance of the 
 project with respect to which such 
 funds are awarded is not more than 48 
 months.
 ``
            (II) Small business concern 
 requirements.--The small business 
 concern shall--
 ``

    (aa) have been awarded 
 not less than 1 prior Phase II 
 award under the SBIR or STTR 
 program;
 ``

    (bb) demonstrate not less 
 than 100 percent matching funds 
 from sources other than the 
 Government or amounts awarded 
 by participating agencies under 
 a program other than Phase I 
 and II of the SBIR or STTR 
 program as a result of an award 
 using funds made available 
 under a strategic breakthrough 
 allocation;
 ``
            (cc) is an effective 
 solution, as determined by 
 market research; and
 ``
            (dd) only be eligible for 
 an award from the strategic 
 breakthrough allocation if the 
 product, process, or technology 
 of the small business concern--

 ``

    (AA) meets a 
 necessary level of 
 readiness and has a 
 commitment for 
 inclusion in a program 
 objective memorandum 
 from an official with 
 the rank of program 
 executive officer or 
 higher in an 
 acquisition 
 organization of the 
 participating agency 
 making such award; and

 ``

    (BB) will meet 
 high priority 
 requirements or 
 operational needs of 
 such participating 
 agency through a 
 successful transition 
 and into the 
 acquisition process.

 ``
            (III) Deadline.--Each 
 participating agency shall complete any 
 contract awards using strategic 
 breakthrough allocation funds not later 
 than 90 days after receiving a proposal 
 from a small business concern for the 
 award.
 ``
            (IV) Eligible activities.--
 Eligible activities by a small business 
 concern using strategic breakthrough 
 allocation funds are--
 ``

    (aa) design for 
 manufacturing;
 ``

    (bb) establishing 
 manufacturing facilities, 
 tooling, and supply chain 
 capacity;
 ``
            (cc) buying raw materials 
 or inventory;
 ``
            (dd) the integration of 
 products with open 
 interoperability standards;
 ``

    (ee) testing, evaluation, 
 and certification of low-rate 
 production units; and
 ``

    (ff) the purchase of 
 production units and 
 maintenance.
 ``
            (V) Selection criteria.--In 
 making awards using funds made 
 available under a strategic 
 breakthrough allocation, a 
 participating agency shall consider--
 ``

    (aa) the potential of the 
 small business concern to--

 ``

    (AA) advance the 
 national security 
 capabilities of the 
 United States; and

 ``

    (BB) provide new 
 technologies or 
 processes, or new 
 applications of 
 existing technologies, 
 that will enable new 
 alternatives to 
 existing programs;

 ``

    (bb) whether a customer 
 in the participating agency has 
 expressed an intent to purchase 
 and integrate technology from 
 the small business concern into 
 its operations; and
 ``
            (cc) whether a particular 
 technology area is 
 undercapitalized by private 
 investment.
 ``
            (C) Acquisition mechanism.--A participating 
 agency shall establish a mechanism to provide small 
 business concerns with direct access to program and 
 requirements offices throughout the participating 
 agency that may purchase technology from small business 
 concerns under Phase III of the SBIR program.
 ``
            (D) Use of streamlined contracting mechanisms.--
 Each participating agency shall implement streamlined 
 processes and requirements for submitting proposals and 
 applying for awards using funds made available under a 
 strategic breakthrough allocation.''.

    (b) Commercialization Readiness Program.--

Section 9

    (y) of the Small 
Business Act (15 U.S.C. 638

    (y) ) is amended--

    (1) in paragraph

    (2) --
        (A) by striking ``shall identify'' and inserting 
 the following: ``shall--
 ``
        (A) identify'';
        (B) in subparagraph
        (A) , as so designated--
            (i) by inserting ``, including small 
 business concerns with an award from the 
 strategic breakthrough allocation,'' before 
 ``that have the potential''; and
            (ii) by striking the period at the end and 
 inserting a semicolon; and
            (C) by adding at the end the following:
 ``
        (B) ensure, in collaboration with SBIR program 
 managers of each component, that research programs 
 identified under subparagraph
        (A) are analyzed within 
 the programming and budgeting process as budget 
 requests are developed; and
 ``
            (C) provide to the Committee on Small Business 
 and Entrepreneurship of the Senate and the Committees 
 on Small Business and Science, Space, and Technology of 
 the House of Representatives information on the 
 integration of SBIR and STTR awardees in budget 
 rollouts for research, development, testing, and 
 evaluation activities.'';

    (2) by striking paragraph

    (3) and redesignating paragraphs

    (4) ,

    (5) , and

    (6) as paragraphs

    (3) ,

    (4) , and

    (5) , 
 respectively; and

    (3) in paragraph

    (5) , as so redesignated--
        (A) in the subparagraph heading, by striking ``and 
 sttr'';
        (B) in subparagraph
        (A) --
            (i) by inserting ``substantively'' before 
 ``increase'';
            (ii) by striking ``and the number of Phase 
 II STTR contracts''; and
            (iii) by inserting ``in fiscal year 2028 as 
 compared to fiscal year 2025'' before the 
 semicolon at the end;
            (C) in subparagraph
        (B) , by striking ``and'' at the 
 end;
            (D) by redesignating subparagraph
            (C) as 
 subparagraph
        (E) ;
        (E) by inserting after subparagraph
        (B) the 
 following:
 ``
            (C) establish a mechanism to provide small 
 business concerns with direct access to program and 
 requirements offices that may purchase technology from 
 the small business concern under Phase III of the SBIR 
 program;
 ``
            (D) allow services to provide operational needs 
 statements directly to chiefs of requirements offices; 
 and''; and
        (F) in subparagraph
        (E) , as so redesignated, in 
 clause
            (i) by striking ``and STTR contracts''.

SEC. 103. IMPLEMENTATION BRIEFINGS.

 Not later than 60 days after the date of enactment of this Act, and 
on a recurrent basis until the implementation of paragraph

    (3) of 

section 9

    (ff) of the Small Business Act (15 U.S.C. 638

    (ff) ), as added 
by 

section 102, is complete, the head of each agency participating in 
the SBIR or STTR programs that made an award from funds made available 
under a strategic breakthrough allocation (as defined under paragraph

    (3)
        (B) of 

section 9

    (ff) of the Small Business Act (15 U.S.C. 638

    (ff) , 
as added by 

section 102)) shall brief the Committee on Small Business 
and Entrepreneurship of the Senate and the Committees on Small Business 
and on Science, Space, and Technology of the House of Representatives 
on such implementation.

SEC. 104. FIXED-PRICE CONTRACTS.

 

Section 9 of the Small Business Act (15 U.S.C. 638) is amended--

    (1) in subsection

    (f) , by adding at the end the following:
 ``

    (5) Fixed-price contract.--Any funding agreement that is 
 a contract made with expenditures allocated to the SBIR program 
 under paragraph

    (1) shall be a firm fixed-price contract (as 
 defined in 

section 16.202 of the Federal Acquisition 
 Regulation), unless, on a case-by-case basis, the head of the 
 awarding Federal agency makes a written determination to use a 
 different contract structure.''; and

    (2) in subsection

    (n) , by adding at the end the following:
 ``

    (5) Fixed-price contract.--Any funding agreement that is 
 a contract made with expenditures allocated to the STTR program 
 under paragraph

    (1) shall be a firm fixed-price contract (as 
 defined in 

section 16.202 of the Federal Acquisition 
 Regulation), unless the head of the awarding Federal agency 
 makes a written determination to use a different contract 
 structure.''.

 TITLE II--ENCOURAGING SMALL BUSINESS INNOVATION IN ALL OF AMERICA

SEC. 201. ENCOURAGING NEW SBIR AND STTR ENTRANTS.

    (a) Encouraging New SBIR and STTR Entrants.--

Section 9

    (jj) of the 
Small Business Act (15 U.S.C. 638

    (jj) ) is amended to read as follows:
 ``

    (jj) Encouraging New SBIR and STTR Entrants.--
 ``

    (1) Optimizing sbir and sttr funding.--
 ``
        (A) In general.--The head of a participating 
 agency may award a Phase I or Phase II award to a small 
 business concern only if the total value of the Phase I 
 and Phase II awards awarded to such small business 
 concern, including its affiliates, spinouts, and 
 subsidiaries, does not exceed $75,000,000.
 ``
        (B) Waiver.--
 ``
            (i) In general.--On an award-by-award 
 basis, the Undersecretary or Director 
 overseeing the SBIR or STTR program of a 
 Federal agency may waive the requirement under 
 subparagraph
        (A) with a written justification 
 by the Undersecretary or Director that explains 
 why the use of the waiver authority for an 
 otherwise disqualified small business concern 
 is imperative for national security purposes 
 and why the work cannot be performed by other 
 qualifying small business concerns.
 ``
            (ii) Nondelegation.--The waiver authority 
 established under clause
            (i) may not be 
 delegated.
 ``
            (iii) Record requirement.--Participating 
 agencies shall maintain information on any 
 awards made using the waiver established under 
 clause
            (i) , including the amount of the award, 
 the written justification for each award, and 
 the identity of the award recipient.
 ``
            (iv) Report.--The Administrator shall 
 include the information described in clause
            (iii) in the annual report of the Administrator 
 to Congress required by subsection

    (b)

    (7) .
 ``

    (2) Principal investigators.--An individual may not 
 concurrently serve as the principal investigator on more than 1 
 proposal to a single Phase I solicitation or a single Phase II 
 solicitation.
 ``

    (3) Phase i size standard.--A small business concern 
 applying for a Phase I award may not have annual receipts (as 
 defined in 

section 121.104 of title 13, Code of Federal 
 Regulations, or any successor regulation) of more than 
 $40,000,000 for the most recent fiscal year.''.

    (b) Phase 1A Program.--

    (1) In general.--

Section 9 of the Small Business Act (15 
 U.S.C. 638) is amended--
        (A) in subsection

    (e) --
            (i) in paragraph

    (4) --
            (I) in subparagraph
        (A) , by 
 striking ``subparagraph
        (B) '' and 
 inserting ``subparagraph
            (C) '';
            (II) by redesignating subparagraphs
        (B) and
            (C) as subparagraphs
            (C) and
            (D) ; and
            (III) by inserting after 
 subparagraph
        (A) , the following:
 ``
        (B) a 1A phase for the same purposes as the first 
 phase described under subparagraph
        (A) and intended to 
 increase accessibility to the program for new entrants 
 with proposals submitted pursuant to only SBIR open 
 topic announcements;''; and
            (ii) by adding at the end following:
 ``

    (20) the term `Phase 1A' means the phase described in 
 paragraph

    (4)
        (B) ;''; and
        (B) by amending subsection

    (pp) to read as follows:
 ``

    (pp) Phase 1A Awards.--
 ``

    (1) Sense of congress.--It is the sense of Congress 
 that--
 ``
        (A) Phase 1A funds will bring thousands of new 
 small business concerns committed to commercialization 
 of critical technologies into the SBIR program; and
 ``
        (B) in order for participating agencies to 
 benefit from the full scope of American innovation and 
 identify the most promising solutions to scale, Phase 
 1A awards should fund the strongest technologies in a 
 topic area regardless of--
 ``
            (i) the location of the small business 
 concern within the United States; or
 ``
            (ii) the educational background of the 
 principal investigator.
 ``

    (2) Authorization.--The head of each agency with an SBIR 
 program shall allocate not less than 1.5 percent of funding and 
 not more than 3 percent of funding for the SBIR program of the 
 agency to Phase 1A awards.
 ``

    (3) Solicitation.--A solicitation issued under this 
 subsection shall be conducted as an open topic announcement.
 ``

    (4) Eligibility.--A small business concern, including its 
 affiliates, spinouts, or subsidiaries, is eligible for an award 
 under this subsection only if such small business concern, 
 including its affiliates, spinouts, or subsidiaries, has not 
 previously received an SBIR or STTR award.
 ``

    (5) Proposal.--
 ``
        (A) In general.--A proposal submitted in response 
 to a solicitation under this subsection shall consist 
 of a report that is not more than 5 pages in length and 
 containing the criteria in clauses
            (i) through
            (iv) of 
 subparagraph
        (B) .
 ``
        (B) Criteria.--
 ``
            (i) Identification of program.--The small 
 business concern shall describe the problem 
 that the proposal is intended to address for 
 the awarding agency and any commercial 
 customer.
 ``
            (ii) Description of solution.--The small 
 business concern shall describe the proposed 
 solution, including the technical basis for the 
 solution to demonstrate how the solution would 
 address the problem described in the proposal, 
 including the level of maturity of the solution 
 at the time of the proposal.
 ``
            (iii) Effects of the solution.--The small 
 business concern shall describe how adoption of 
 the proposed solution would produce potential 
 time savings, cost savings, risk reduction, 
 improvement of mission outcomes, or any other 
 beneficial effects for the awarding agency and 
 any commercial customer.
 ``
            (iv) Differentiation.--The small business 
 concern shall--
 ``
            (I) identify the state of 
 solutions in use at the time of the 
 proposal to address the problem 
 described in the proposal; and
 ``
            (II) explain how the proposed 
 solution is a unique and novel 
 solution.
 ``
            (v) Commercialization strategy.--The 
 small business concern shall--
 ``
            (I) describe how the small 
 business concern intends to fund the 
 proposed solution from sources other 
 than the award; and
 ``
            (II) explain the market for the 
 proposed solution, including the 
 intended Government and commercial end 
 users.
 ``

    (6) Award limits.--
 ``
        (A) Number of awards.--A small business concern 
 or principal investigator is eligible for not more than 
 one Phase 1A award.
 ``
        (B) Amount.--An award made under this subsection 
 shall be for not more than $40,000.
 ``

    (7) Notification of selection or non-selection.--Each 
 agency shall notify each small business concern of the award 
 decision of the agency on any proposal submitted by the small 
 business concern not later than 90 days after the date on which 
 the solicitation closes.
 ``

    (8) Application for phase ii award.--
 ``
        (A) Eligibility.--A small business concern that 
 receives a Phase 1A award shall be eligible to apply 
 for a Phase II award.
 ``
        (B) Use of funds.--A small business concern may 
 use funds from a Phase 1A award to develop a proposed 
 solution in pursuit of a subsequent proposal for a 
 Phase I award or a Phase II award.
 ``

    (9) Streamlined awards.--The head of each participating 
 agency shall implement streamlined processes and requirements 
 for submitting proposals and applying for solicitations for 
 Phase 1A awards.
 ``

    (10) Peer review requirement.--The head of a 
 participating agency may waive any applicable peer review 
 requirements for Phase 1A awards.''.

    (2) Conforming amendments.--

Section 9

    (e) of the Small 
 Business Act (15 U.S.C. 638

    (e) ) is amended--
        (A) in paragraph

    (12)
        (A) , by striking ``paragraph

    (4)
        (B) '' and inserting ``paragraph

    (4)
            (C) ''; and
        (B) in paragraph

    (13)
        (A) , by striking ``paragraph

    (4)
            (C) '' and inserting ``paragraph

    (4)
            (D) ''.

SEC. 202. COMBATING DISCRIMINATORY PRACTICES IN THE SBIR AND STTR 
 PROGRAMS.

 

Section 9 of the Small Business Act (15 U.S.C. 638), as amended by 
this Act, is amended--

    (1) in subsection

    (b)

    (7)
            (C) , by striking ``owned and 
 controlled by women or by socially or economically 
 disadvantaged individuals'' and inserting ``owned by 
 individuals who reside in rural areas'';

    (2) in subsection

    (e) --
        (A) in paragraph

    (18) , by striking ``and'' at the 
 end;
        (B) in paragraph

    (19) , by striking the period at 
 the end and inserting a semicolon; and
            (C) by adding at the end the following:
 ``

    (21) the term `new entrants' means a small business 
 concern that has not received an SBIR or STTR award;
 ``

    (22) the term `rural area' means a county or other 
 political subdivision of a State that the Bureau of the Census 
 has defined as mostly rural or completely rural in the most 
 recent decennial census;'';

    (3) in subsection

    (g)

    (8)
        (A) --
        (A) by striking clause
            (iii) ;
        (B) by redesignating clauses
            (iv) ,
            (v) , and
            (vi) as 
 clauses
            (iii) ,
            (iv) , and
            (v) , respectively; and
            (C) in clause
            (iii) , as so redesignated, by 
 striking ``a socially or economically disadvantaged 
 individual or has a socially or economically 
 disadvantaged individual'' and inserting ``an 
 individual who resides in a rural area or has an 
 individual who resides in a rural area or is a new 
 entrant'';

    (4) in subsection

    (j) --
        (A) by adjusting the margins for paragraphs

    (2) and

    (3) 2 ems to the left; and
        (B) in paragraph

    (2) --
            (i) by striking subparagraph
        (F) ;
            (ii) by redesignating subparagraphs
        (G) ,
        (H) , and
            (I) as subparagraphs
        (F) ,
        (G) , and
        (H) , respectively; and
            (iii) in subparagraph
        (H) , as so 
 redesignated, by striking ``subparagraph
        (H) '' 
 and inserting ``subparagraph
        (G) '';

    (5) in subsection

    (k)

    (1)
        (F) --
        (A) by striking clause
            (ii) ;
        (B) by redesignating clauses
            (iii) ,
            (iv) , and
            (v) as clauses
            (ii) ,
            (iii) , and
            (iv) , respectively; and
            (C) in clause
            (ii) , as so redesignated, by striking 
 ``a socially or economically disadvantaged individual 
 or has a socially or economically disadvantaged 
 individual'' and inserting ``an individual who resides 
 in a rural area or has an individual who resides in a 
 rural area or is a new entrant'';

    (6) in subsection

    (o)

    (9)
        (A) --
        (A) by striking clause
            (iii) ;
        (B) by redesignating clauses
            (iv) ,
            (v) , and
            (vi) as 
 clauses
            (iii) ,
            (iv) , and
            (v) , respectively; and
            (C) in clause
            (iii) , as so redesignated, by 
 striking ``a socially or economically disadvantaged 
 individual or has a socially or economically 
 disadvantaged individual'' and inserting ``an 
 individual who resides in a rural area or has an 
 individual who resides in a rural area or is a new 
 entrant''; and

    (7) in subsection
            (mm) --
        (A) in paragraph

    (1) --
            (i) in the matter preceding subparagraph
        (A) , by striking ``and until September 30, 
 2025''; and
            (ii) in subparagraph
        (F) , by striking ``or 
 abuse to ensure compliance'' and inserting 
 ``abuse, or adversarial influence to ensure 
 compliance'';
        (B) in paragraph

    (2)
        (A) , by striking ``to carry out 
 the policy directive required under subsection

    (j)

    (2)
        (F) and'' and inserting ``to increase the 
 participation of States with respect to which a low 
 level of SBIR awards have historically been awarded''; 
 and
            (C) by adding at the end the following:
 ``

    (7) Eligibility.--An agency may use the funds allocated 
 to the SBIR program of such agency under this subsection only 
 if such agency does not--
 ``
        (A) consider the race, gender, or ethnicity of 
 the principal investigator, founder, or key personnel 
 of the small business concern applying for an SBIR or 
 STTR award in an award decision under the SBIR or STTR 
 program of the agency;
 ``
        (B) require or consider a statement or plan to 
 promote diversity or equity as part of an application 
 for an SBIR or STTR award under the SBIR or STTR 
 program of the agency; or
 ``
            (C) offer supplemental funds to a recipient of an 
 SBIR or STTR award based on the race, gender, or 
 ethnicity of the principal investigator, founder, or 
 key personnel of a small business concern.''.

SEC. 203. DISCLOSURES AND PROHIBITIONS RELATING TO CERTAIN AGREEMENTS 
 WITH ENTITIES ENGAGING IN CENSORSHIP.

    (a) Disclosure for SBIR Applicants.--

Section 9

    (g)

    (13) of the Small 
Business Act (15 U.S.C. 638

    (g)

    (13) ) is amended--

    (1) in subparagraph
        (F) , by striking ``and'' at the end;

    (2) in subparagraph
        (G) , by striking the semicolon at the 
 end and inserting ``; and''; and

    (3) by adding at the end the following:
 ``
        (H) a current or pending agreement with--
 ``
            (i) NewsGuard Technologies, Inc. (doing 
 business as `NEWSGuard');
 ``
            (ii) Disinformation Index, Inc., 
 Disinformation Index, Ltd., or Global 
 Disinformation Index gUG (collectively doing 
 business as `Global Disinformation Index');
 ``
            (iii) Internews; or
 ``
            (iv) an entity that engages in operations 
 or activities, or produces products, the 
 function of which is to demonetize or rate the 
 credibility of a domestic entity (including 
 news and information outlets) based on lawful 
 speech of such domestic entity under the stated 
 function of `fact-checking' or otherwise 
 exposing or correcting misinformation, 
 disinformation, or misinformation;''.

    (b) Prohibition on SBIR Awards.--Paragraph

    (16) of 

section 9

    (g) of 
the Small Business Act (15 U.S.C. 638

    (g) ), as redesignated by 

section 402, is amended by adding at the end the following:
 ``
        (G) the small business concern submitting the 
 proposal or application has a current or pending 
 agreement with--
 ``
            (i) NewsGuard Technologies, Inc. (doing 
 business as `NEWSGuard');
 ``
            (ii) Disinformation Index, Inc., 
 Disinformation Index, Ltd., or Global 
 Disinformation Index gUG (collectively doing 
 business as `Global Disinformation Index');
 ``
            (iii) Internews; or
 ``
            (iv) an entity that engages in operations 
 or activities, or produces products, the 
 function of which is to demonetize or rate the 
 credibility of a domestic entity (including 
 news and information outlets) based on lawful 
 speech of such domestic entity under the stated 
 function of `fact-checking' or otherwise 
 exposing or correcting misinformation, 
 disinformation, or misinformation;''.
            (c) Disclosure for STTR Applicants.--

Section 9

    (o)

    (17) of the Small 
Business Act (15 U.S.C. 638

    (o)

    (17) ) is amended--

    (1) in subparagraph
        (F) , by striking ``and'' at the end;

    (2) in subparagraph
        (G) , by striking the semicolon at the 
 end and inserting ``; and''; and

    (3) by adding at the end the following:
 ``
        (H) a current or pending agreement with--
 ``
            (i) NewsGuard Technologies, Inc. (doing 
 business as `NEWSGuard');
 ``
            (ii) Disinformation Index, Inc., 
 Disinformation Index, Ltd., or Global 
 Disinformation Index gUG (collectively doing 
 business as `Global Disinformation Index');
 ``
            (iii) Internews; or
 ``
            (iv) an entity that engages in operations 
 or activities, or produces products, the 
 function of which is to demonetize or rate the 
 credibility of a domestic entity (including 
 news and information outlets) based on lawful 
 speech of such domestic entity under the stated 
 function of `fact-checking' or otherwise 
 exposing or correcting misinformation, 
 disinformation, or misinformation;''.
            (d) Prohibition on STTR Awards.--Paragraph

    (20) of 

section 9

    (o) of 
the Small Business Act (15 U.S.C. 638

    (o)

    (20) ), as redesignated by 

section 402, is amended by adding at the end the following:
 ``
        (G) the small business concern submitting the 
 proposal or application has a current or pending 
 agreement with--
 ``
            (i) NewsGuard Technologies, Inc. (doing 
 business as `NEWSGuard');
 ``
            (ii) Disinformation Index, Inc., 
 Disinformation Index, Ltd., or Global 
 Disinformation Index gUG (collectively doing 
 business as `Global Disinformation Index');
 ``
            (iii) Internews; or
 ``
            (iv) an entity that engages in operations 
 or activities, or produces products, the 
 function of which is to demonetize or rate the 
 credibility of a domestic entity (including 
 news and information outlets) based on lawful 
 speech of such domestic entity under the stated 
 function of `fact-checking' or otherwise 
 exposing or correcting misinformation, 
 disinformation, or misinformation;''.

    (e) Conforming Amendments.--

    (1) SBIR awards.--Paragraph

    (19)
        (A) of 

section 9

    (g) of the 
 Small Business Act (15 U.S.C. 638

    (g) ), as so redesignated by 
 

section 402, is amended by striking ``through
        (G) '' and 
 inserting ``through
        (H) ''.

    (2) STTR awards.--Paragraph

    (23)
        (A) of 

section 9

    (o) of the 
 Small Business Act (15 U.S.C. 638

    (o) ), as so redesignated by 
 

section 402, is amended by striking ``through
        (G) '' and 
 inserting ``through
        (H) ''.

SEC. 204. CONNECTING SBIR AND STTR AWARDEES AND SMALL BUSINESS 
 INVESTMENT COMPANIES.

 

Section 9
            (mm) (1) of the Small Business Act (15 U.S.C. 638
            (mm) (1) ) 
is amended--

    (1) in subparagraph
        (J) , by striking ``and'' at the end;

    (2) in subparagraph
        (K) , by striking the period at the end 
 and inserting ``; and''; and

    (3) by adding at the end the following new subparagraph:
 ``
            (L) connecting SBIR and STTR awardees with small 
 business investment companies (as defined under 

section 103 of the Small Business Investment Act of 1958 (15 
 U.S.C. 662)) and other domestic private investors.''.

SEC. 205. AGENCY OUTREACH TO RURAL COMMUNITIES.

    (a) Agency Outreach.--

Section 9 of the Small Business Act (15 
U.S.C. 638) is amended--

    (1) in subsection

    (j) , by adding at the end the following 
 new paragraphs:
 ``

    (5) Modification relating to rural outreach.--Not later 
 than 90 days after the date of the enactment of this paragraph, 
 the Administrator shall modify the policy directives issued 
 pursuant to this subsection to require each Federal agency 
 participating in the SBIR program to enhance the outreach 
 efforts of such Federal agency to rural communities to increase 
 the participation of small businesses concerns located in rural 
 communities in the SBIR program, including by ensuring that 
 such Federal agency--
 ``
        (A) conducts outreach efforts with respect to the 
 SBIR program in rural communities; and
 ``
        (B) when such Federal agency conducts such 
 outreach in an area served by a small business 
 development center, coordinates with such small 
 business development center.
 ``

    (6) Modification relating to rural outreach.--Not later 
 than 90 days after the date of the enactment of this paragraph, 
 the Administrator shall modify the policy directives issued 
 pursuant to this subsection to require the Administration to 
 place a special emphasis on small business concerns in rural 
 areas when conducting outreach related to the SBIR program, 
 including by ensuring that the Administration includes outreach 
 efforts in rural communities carried out by the Administration 
 with respect to the SBIR program.''; and

    (2) in subsection

    (p) , by adding at the end the following 
 new paragraph:
 ``

    (4) Modification relating to rural outreach.--Not later 
 than 90 days after the date of the enactment of this paragraph, 
 the Administrator shall modify the policy directive issued 
 pursuant to this subsection to require each Federal agency 
 participating in the STTR program to enhance the outreach 
 efforts of such Federal agency to rural communities to increase 
 the participation of small businesses concerns located in rural 
 communities in the STTR program, including by ensuring that 
 such Federal agency--
 ``
        (A) conducts outreach efforts with respect to the 
 STTR program in rural communities; and
 ``
        (B) when such Federal agency conducts such 
 outreach in an area served by a small business 
 development center, coordinates with such small 
 business development center.
 ``

    (5) Modification relating to rural outreach.--Not later 
 than 90 days after the date of the enactment of this paragraph, 
 the Administrator shall modify the policy directive issued 
 pursuant to this subsection to require the Administration to 
 place a special emphasis on small business concerns in rural 
 areas when conducting outreach related to the STTR program, 
 including by ensuring that the Administration includes outreach 
 efforts in rural communities carried out by the Administration 
 with respect to the STTR program.''.

    (b) Modification of Current Directives.--

Section 9

    (j)

    (2) of the 
Small Business Act (15 U.S.C. 638

    (j)

    (2) ), as amended by 

section 202

    (4)
        (B) , is amended by revising subparagraph
        (F) to read as follows:
 ``
        (F) enhanced outreach efforts to increase the 
 participation of small business concerns that have 
 never participated in Federal research and development 
 to develop innovative technologies, with a special 
 emphasis on small business concerns in rural areas;''.

 TITLE III--STREAMLINING PARTICIPATION IN THE SBIR AND STTR PROGRAMS

SEC. 301. AMENDMENTS RELATING TO OPEN TOPICS.

    (a) Definition of Open Topic Announcement.--

Section 9

    (e) of the 
Small Business Act (15 U.S.C. 638

    (e) ), as amended by 

section 202

    (2) , is 
further amended by adding at the end the following:
 ``

    (23) the term `open topic announcement' means a 
 solicitation for SBIR or STTR proposals that--
 ``
        (A) is a generalized problem statement or broad 
 technology area and does not contain any language 
 requiring that the solutions that a small business 
 concern proposes adhere to specific technological 
 specifications; and
 ``
        (B) evaluates the ability of the solution 
 proposed by the small business concern to meet the 
 stated innovation need of the agency or Government end 
 user; and''.

    (b) Program on Innovation Open Topics.--

Section 9

    (ww) of the Small 
Business Act (15 U.S.C. 638) is amended--

    (1) in paragraph

    (1) --
        (A) in the matter preceding subparagraph
        (A) , by 
 striking ``Secretary of Defense'' and inserting ``head 
 of each participating agency''; and
        (B) by striking ``the Department of Defense'' each 
 place it appears and inserting ``such participating 
 agency'';

    (2) in paragraph

    (2) --
        (A) by striking ``Secretary of Defense'' and 
 inserting ``head of each participating agency'';
        (B) by striking ``each component of'' and inserting 
 ``such participating agency and, with respect to''; and
            (C) by inserting ``, each component thereof,'' 
 before ``per fiscal year''; and

    (3) by striking paragraph

    (3) .

SEC. 302. REDUCING ADMINISTRATIVE BURDEN.

 

Section 9

    (jj) of the Small Business Act (15 U.S.C. 638

    (jj) ), as 
amended by 

section 201

    (a)

    (1) , is further amended by adding at the end 
the following:
 ``

    (4) Reducing administrative burden.--
 ``
        (A) Limit on submissions to a solicitation.--A 
 small business concern, including its affiliates, 
 spinouts, or subsidiaries, may not submit more than 10 
 proposals to a single Phase I solicitation or a single 
 Phase II solicitation under subsection
            (cc) .
 ``
        (B) Limit on submissions in a single year.--A 
 small business concern, including its affiliates, 
 spinouts, or subsidiaries, may not submit more than a 
 combined total of 25 proposals to Phase I solicitations 
 or Phase II solicitations under subsection
            (cc) published by a single agency, including the components 
 of the agency, in a single fiscal year.''.

 TITLE IV--PROTECTING AMERICAN INNOVATION FROM ADVERSARIAL INFLUENCE

SEC. 401. DEFINITION OF FOREIGN RISK.

 

Section 9

    (e) of the Small Business Act (15 U.S.C. 638

    (e) ), as 
amended by 

section 301, is further amended by adding at the end the 
following:
 ``

    (24) the term `foreign risk' means, in the past 10 years, 
 any foreign affiliation, technology licensing agreement, joint 
 venture, contractual or financial obligation (pending or 
 otherwise), investment agreement, research relationship 
 (including co-authorship), or business relationship between--
 ``
        (A) a small business concern (including all 
 subsidiaries, spinouts, and affiliates) submitting a 
 proposal for an SBIR or STTR program, and covered 
 individuals, owners, or other key personnel of the 
 small business concern; and
 ``
        (B) an individual, research institution, business 
 entity, government, or government-owned entity in a 
 foreign country of concern that is disclosed, as 
 required under subsection

    (g) or subsection

    (o) , or 
 otherwise identified in the due diligence process, as 
 required under subsection
            (vv) .''.

SEC. 402. BOLSTERING RESEARCH SECURITY OF SBIR AND STTR AWARDS.

 

Section 9 of the Small Business Act (15 U.S.C. 638), as amended by 
this Act, is amended--

    (1) in subsection

    (g) --
        (A) by redesignating paragraphs

    (15) ,

    (16) , and

    (17) as paragraphs

    (16) ,

    (18) , and

    (19) , respectively;
        (B) by inserting after paragraph

    (14) the 
 following:
 ``

    (15) evaluate whether a small business concern presents a 
 risk to national security for any reason, through measures 
 including--
 ``
        (A) the due diligence process required under 
 subsection
            (vv) ;
 ``
        (B) disclosures submitted under this subsection; 
 or
 ``
            (C) coordination with the Inspector General of 
 the agency or the intelligence community (as defined 
 under 

section 3 of the National Security Act of 1947 
 (50 U.S.C. 3003));'';
            (C) in paragraph

    (16) , as so redesignated--
            (i) by striking subparagraph
        (B) ;
            (ii) by striking ``that--'' and all that 
 follows through ``the small business concern 
 submitting'' and inserting ``that the small 
 business concern submitting'';
            (iii) by redesignating clauses
            (i) ,
            (ii) , 
 and
            (iii) as subparagraphs
        (A) ,
        (B) , and
            (C) , 
 respectively, and adjusting the margins 
 accordingly;
            (iv) in subparagraph
        (B) , as so 
 redesignated, by striking ``or'' at the end;
            (v) in subparagraph
            (C) , as so 
 redesignated, by striking ``and'' at the end; 
 and
            (vi) by adding at the end the following:
 ``
            (D) has a foreign risk connecting the small 
 business concern to an entity, including any 
 affiliates, spinouts, or subsidiaries of the entity, or 
 individual on one or more of the following lists:
 ``
            (i) the UFLPA Entity List maintained by 
 the Department of Homeland Security;
 ``
            (ii) the Non-SDN Chinese Military-
 Industrial Complex Companies List of the Office 
 of Foreign Assets Control maintained by the 
 Department of the Treasury;
 ``
            (iii) the 

Section 889 Prohibition List 
 established under 

section 889 of the John S. 
 McCain National Defense Authorization Act for 
 Fiscal Year 2019 (Public Law 115-232) and 
 maintained by the Department of Defense;
 ``
            (iv) the list of Chinese Military 
 companies required under 

section 1260H of the 
 William M.

    (Mac) Thornberry National Defense 
 Authorization Act for Fiscal Year 2021 (Public 
 Law 116-283) and maintained by the Department 
 of Defense;
 ``
            (v) the Military End User List maintained 
 by the Bureau of Industry and Security of the 
 Department of Commerce;
 ``
            (vi) the Entity List maintained by the 
 Bureau of Industry and Security of the 
 Department of Commerce;
 ``
            (vii) the List of Equipment and Services 
 maintained by the Federal Communications 
 Commission; and
 ``
            (viii) the Withhold Release Orders and 
 Findings List maintained by U.S. Customs and 
 Border Protection;
 ``
        (E) has a foreign risk with a primary source that 
 is classified;
 ``
        (F) has a foreign risk or another national 
 security risk not listed in statute or regulatory 
 guidance that an agency determines warrants a denial; 
 or'';
            (D) by inserting after paragraph

    (16) , as so 
 redesignated, the following:
 ``

    (17) not, and any personnel of the Federal agency 
 including technical points of contact shall not, communicate to 
 an applicant prior to formal notification of an award decision 
 that an application was denied due to a foreign risk;''; and
        (E) in paragraph

    (19) , as so redesignated--
            (i) in subparagraph
        (B) , by striking 
 ``paragraph

    (16)
        (A) '' and inserting ``paragraph

    (18)
        (A) ''; and
            (ii) in subparagraph
            (C) , by striking 
 ``paragraph

    (16)
        (B) '' and inserting ``paragraph

    (18)
        (B) ''; and

    (2) in subsection

    (o) --
        (A) by redesignating paragraphs

    (19) ,

    (20) , and

    (21) as paragraphs

    (20) ,

    (22) , and

    (23) , respectively;
        (B) by inserting after paragraph

    (18) the 
 following:
 ``

    (19) evaluate whether a small business concern presents a 
 risk to national security for any reason, through measures 
 including--
 ``
        (A) the due diligence process required under 
 subsection
            (vv) ;
 ``
        (B) disclosures submitted under this subsection; 
 or
 ``
            (C) coordination with the Inspector General of 
 the agency or the intelligence community (as defined 
 under 

section 3 of the National Security Act of 1947 
 (50 U.S.C. 3003));'';
            (C) in paragraph

    (20) , as so redesignated--
            (i) by striking subparagraph
        (B) ;
            (ii) by striking ``that--'' and all that 
 follows through ``the small business concern 
 submitting'' and inserting ``that the small 
 business concern submitting'';
            (iii) by redesignating clauses
            (i) ,
            (ii) , 
 and
            (iii) as subparagraphs
        (A) ,
        (B) , and
            (C) , 
 respectively, and adjusting the margins 
 accordingly;
            (iv) in subparagraph
        (B) , as so 
 redesignated, by striking ``or'' at the end;
            (v) in subparagraph
            (C) , as so 
 redesignated, by striking ``and'' at the end; 
 and
            (vi) by adding at the end the following:
 ``
            (D) has a foreign risk connecting the small 
 business concern to an entity, including any 
 affiliates, spinouts, or subsidiaries of the entity, or 
 individual on one or more of the following lists:
 ``
            (i) the UFLPA Entity List maintained by 
 the Department of Homeland Security;
 ``
            (ii) the Non-SDN Chinese Military-
 Industrial Complex Companies List of the Office 
 of Foreign Assets Control maintained by the 
 Department of the Treasury;
 ``
            (iii) the 

Section 889 Prohibition List 
 established under 

section 889 of the John S. 
 McCain National Defense Authorization Act for 
 Fiscal Year 2019 (Public Law 115-232) and 
 maintained by the Department of Defense;
 ``
            (iv) the list of Chinese Military 
 companies required under 

section 1260H of the 
 William M.

    (Mac) Thornberry National Defense 
 Authorization Act for Fiscal Year 2021 (Public 
 Law 116-283) and maintained by the Department 
 of Defense;
 ``
            (v) the Military End User List maintained 
 by the Bureau of Industry and Security of the 
 Department of Commerce;
 ``
            (vi) the Entity List maintained by the 
 Bureau of Industry and Security of the 
 Department of Commerce;
 ``
            (vii) the List of Equipment and Services 
 maintained by the Federal Communications 
 Commission; and
 ``
            (viii) the Withhold Release Orders and 
 Findings List maintained by U.S. Customs and 
 Border Protection;
 ``
        (E) has a foreign risk with a primary source that 
 is classified;
 ``
        (F) has a foreign risk or another national 
 security risk not listed in statute or regulatory 
 guidance that an agency determines warrants a denial; 
 or'';
            (D) by inserting after paragraph

    (20) the 
 following:
 ``

    (21) not, and any personnel of the Federal agency 
 including technical points of contact shall not, communicate to 
 an applicant prior to formal notification of an award decision 
 that an application was denied due to a foreign risk;''; and
        (E) in paragraph

    (23) , as so redesignated--
            (i) in subparagraph
        (B) , by striking 
 ``paragraph

    (20)
        (A) '' and inserting ``paragraph

    (22)
        (A) ''; and
            (ii) in subparagraph
            (C) , by striking 
 ``paragraph

    (20)
        (B) '' and inserting ``paragraph

    (22)
        (B) ''.

SEC. 403. STRENGTHENING THE DUE DILIGENCE PROGRAM TO ASSESS SECURITY 
 RISKS.

 

Section 9
            (vv) (2) of the Small Business Act (15 U.S.C. 638
            (vv) (2) ) 
is amended--

    (1) in subparagraph
        (B) , by striking the period at the end 
 and inserting ``; and''; and

    (2) by adding at the end the following:
 ``
            (C) examine any relationship of a small business 
 concern seeking an award to any entity or individual 
 included on the lists, as published on the date of the 
 closing of the solicitation, described under 
 subsections

    (g)

    (16)
            (D) and

    (o)

    (20)
            (D) .''.

SEC. 404. STRENGTHENING AGENCY RECOVERY AUTHORITY.

 

Section 9 of the Small Business Act (15 U.S.C. 638), as amended by 
this Act, is amended--

    (1) in subsection

    (g)

    (18) , as redesignated by 

section 402--
        (A) in the matter preceding subparagraph
        (A) , by 
 inserting ``, as adjusted for inflation according to 
 the Consumer Price Index published by the Bureau of 
 Labor Statistics,'' after ``amounts'';
        (B) in subparagraph
        (A) --
            (i) by inserting ``during the 10-year 
 period beginning on the date of the award, or 
 during a longer or indefinite period as 
 determined by the head of the awarding agency 
 as necessary for national security,'' before 
 ``the small business concern''; and
            (ii) by striking ``or'' at the end;
            (C) in subparagraph
        (B) --
            (i) by inserting ``during the 10-year 
 period beginning on the date of the award, or 
 during a longer or indefinite period as 
 determined by the head of the awarding agency 
 as necessary for national security,'' before 
 ``there is a change''; and
            (ii) by striking ``and'' at the end; and
            (D) by adding at the end the following:
 ``
            (C) during the 5-year period beginning on the 
 date of the award, or during a longer or indefinite 
 period as determined by the head of the awarding agency 
 as necessary for national security, the small business 
 concern sells, leases, or provides (through joint 
 research, technological licensing, or otherwise) 
 intellectual property that was developed, wholly or in 
 part, using an SBIR award to a foreign entity or 
 individual unless the foreign entity or individual is 
 incorporated in or a citizen of a country that is a 
 member of the North Atlantic Treaty Organization or a 
 major non-NATO ally, as described under 

section 2321k 
 of title 22, United States Code; or
 ``
            (D) during the 10-year period beginning on the 
 date of the award, or during a longer or indefinite 
 period as determined by the head of the awarding agency 
 as necessary for national security, the small business 
 concern sells, leases, or provides (through joint 
 research, technological licensing, or otherwise) 
 intellectual property that was developed, wholly or in 
 part, using an SBIR award to an entity, government, or 
 individual in a foreign country of concern; and''; and

    (2) in subsection

    (o)

    (22) , as redesignated by 

section 402--
        (A) in the matter preceding subparagraph
        (A) , by 
 inserting ``, as adjusted for inflation according to 
 the Consumer Price Index published by the Bureau of 
 Labor Statistics,'' after ``amounts'';
        (B) in subparagraph
        (A) --
            (i) by inserting ``during the 10-year 
 period beginning on the date of the award, or 
 during a longer or indefinite period as 
 determined by the head of the awarding agency 
 as necessary for national security,'' before 
 ``the small business concern''; and
            (ii) by striking ``or'' at the end;
            (C) in subparagraph
        (B) --
            (i) by inserting ``during the 10-year 
 period beginning on the date of the award, or 
 during a longer or indefinite period as 
 determined by the head of the awarding agency 
 as necessary for national security,'' before 
 ``there is a change''; and
            (ii) by striking ``and'' at the end; and
            (D) by adding at the end the following:
 ``
            (C) during the 5 year period beginning on the 
 date of the award, or during a longer or indefinite 
 period as determined by the head of the awarding agency 
 as necessary for national security, the small business 
 concern sells, leases, or provides (through joint 
 research, technological licensing, or otherwise) 
 intellectual property that was developed, wholly or in 
 part, using an STTR award to a foreign entity or 
 individual unless the foreign entity or individual is 
 incorporated in or a citizen of a country that is a 
 member of the North Atlantic Treaty Organization or a 
 major non-NATO ally, as described under 

section 2321k 
 of title 22, United States Code; or
 ``
            (D) during the 10-year period beginning on the 
 date of the award, or during a longer or indefinite 
 period as determined by the head of the awarding agency 
 as necessary for national security, the small business 
 concern sells, leases, or provides (through joint 
 research, technological licensing, or otherwise) 
 intellectual property that was developed, wholly or in 
 part, using an STTR award to an entity, government, or 
 individual in a foreign country of concern; and''.

SEC. 405. BEST PRACTICES ON INVESTOR INFORMATIONAL RIGHTS.

 

Section 9

    (uu) of the Small Business Act (15 U.S.C. 638

    (uu) ) is 
amended to read as follows:
 ``

    (uu) Best Practices on Investor Informational Rights.--
 ``

    (1) In general.--The Administrator, in coordination with 
 the heads of all agencies with an SBIR program, the Director of 
 the White House Office of Science and Technology Policy, and 
 the Committee on Foreign Investment in the United States, shall 
 develop best practices to be shared with each recipient of an 
 SBIR or STTR award by the agency granting the award.
 ``

    (2) Contents.--The best practices developed under 
 paragraph

    (1) shall include recommendations for protecting the 
 proprietary technology and intellectual property of the small 
 business concern from being shared unintentionally to foreign 
 individuals and entities through informational rights of 
 limited partners in venture capital, hedge fund, or private 
 equity firms that have investments in SBIR or STTR 
 recipients.''.

SEC. 406. GAO REPORT.

 Paragraph

    (4) of 

section 4

    (b) of the SBIR and STTR Extension Act of 
2022 (Public Law 117-183; 136 Stat. 2194) is amended to read as 
follows:
 ``

    (4) GAO report.--
 ``
        (A) In general.--Not later than 18 months after 
 the date of enactment of the INNOVATE Act, and annually 
 thereafter under September 30, 2028, the Comptroller 
 General of the United States shall conduct a study and 
 submit to the Committee on Small Business and 
 Entrepreneurship and the Committee on Armed Services of 
 the Senate and the Committee on Small Business, the 
 Committee on Armed Services, and the Committee on 
 Science, Space, and Technology of the House of 
 Representatives a report on the implementation and best 
 practices of the due diligence programs established 
 under 

section 9
            (vv) of the Small Business Act (15 
 U.S.C. 638
            (vv) ) across Federal agencies required to 
 establish an SBIR or STTR program.
 ``
        (B) Study.--The study shall evaluate--
 ``
            (i) the effectiveness of each Federal 
 agency that participates in the SBIR program or 
 STTR program in identifying--
 ``
            (I) enhanced risk in 
 cybersecurity practices in SBIR and 
 STTR projects;
 ``
            (II) enhanced risk in patents, 
 including co-authorship with academics 
 in foreign countries of concern in SBIR 
 and STTR projects;
 ``
            (III) enhanced foreign influence 
 risk among employees of small business 
 concerns involved in SBIR and STTR 
 projects;
 ``
            (IV) foreign ownership of a small 
 business concern seeking an award, 
 including the financial ties and 
 obligations (which shall include 
 surety, equity, and debt obligations) 
 in SBIR and STTR projects; and
 ``
            (V) security risks among 
 applicants to the SBIR program or the 
 STTR program, including connections to 
 an entity, including any affiliates, 
 spinouts, or subsidiaries of the 
 entity, or individual on one or more of 
 the lists referenced in paragraph

    (16)
            (D) of 

section 9

    (g) of the Small 
 Business Act (15 U.S.C. 638

    (g) );
 ``
            (ii) by year, the number of proposals and 
 number of small business concerns with foreign 
 risks by each Federal agency that participates 
 in the SBIR program or STTR program, including 
 a delineation of how many of those small 
 business concerns have previously received an 
 award under the SBIR program or STTR program 
 and the nature of those foreign risks made by 
 each Federal agency; and
 ``
            (iii) the extent to which the Inspector 
 General and counterintelligence authorities of 
 each Federal agency that participates in the 
 SBIR or STTR program effectively conducts 
 investigations, audits, inspections, and 
 outreach relating to the due diligence program 
 to assess security risks in the SBIR or STTR 
 program.''.

 TITLE V--SIMPLIFYING SBIR-STTR STANDARDS

SEC. 501. IMPROVING DIRECT TO PHASE II AUTHORITIES.

 

Section 9
            (cc) of the Small Business Act (15 U.S.C. 638
            (cc) ) is 
amended to read as follows:
 ``
            (cc) Phase Flexibility.--
 ``

    (1) Awarding a phase ii award absent a phase i award.--
 Each agency with an SBIR program may provide to a small 
 business concern an award under Phase II of the SBIR program 
 with respect to a project, without regard to whether the small 
 business concern was provided an award under Phase I of an SBIR 
 program with respect to such project, if the head of the agency 
 determines that the small business concern has completed the 
 determinations described in subsection

    (e)

    (4)
        (A) with respect 
 to such project despite not having been provided a Phase I 
 award.
 ``

    (2) Limitations on awards.--
 ``
        (A) In general.--Except as provided in 
 subparagraph
        (B) , the head of each agency with an SBIR 
 program may award not more than 10 percent of the funds 
 allocated for the SBIR program of the agency in a given 
 fiscal year under the authority of this subsection.
 ``
        (B) National institutes of health and department 
 of defense.--The Director of the National Institutes of 
 Health may award not more than 30 percent of the funds 
 allocated for the SBIR program of the National 
 Institutes of Health in a given fiscal year and the 
 Secretary of Defense may award not more than 30 percent 
 of the funds allocated for the SBIR program of each 
 component in the Department of Defense in a given 
 fiscal year under the authority of this subsection.
 ``
            (C) Limit on eligibility for awards.--An agency 
 may not make an award under this subsection to a small 
 business concern, including its affiliates, spinouts, 
 and subsidiaries, that has received more than 25 Phase 
 II awards.
 ``
            (D) Limit on number of awards.--An agency may 
 make not more than 25 awards under this subsection to a 
 small business concern, including its affiliates, 
 spinouts, and subsidiaries.''.

SEC. 502. IMPROVING SBIR AND STTR DATA COLLECTION.

    (a) Additional Data Fields in SBIR Database.--

Section 9

    (k)

    (1) of 
the Small Business Act (15 U.S.C. 638

    (k)

    (1) ) is amended--

    (1) in subparagraph
        (E)
            (iv) , by striking ``and'' at the 
 end;

    (2) in subparagraph
        (F)
            (v) , by striking the period at the 
 end and inserting ``; and''; and

    (3) by adding at the end the following:
 ``
        (G) for each award granted, whether the award is 
 classified or designated as--
 ``
            (i) Phase 1A, under subsection

    (pp) ;
 ``
            (ii) direct to Phase II, under subsection
            (cc) ;
 ``
            (iii) subsequent Phase II, under 
 subsection

    (bb)

    (1) ;
 ``
            (iv) strategic breakthrough award under 
 subsection

    (ff)

    (3) ;
 ``
            (v) Phase III prime contract award; or
 ``
            (vi) Phase III subcontract award.''.

    (b) Improving FPDS Data Tracking.--

    (1) In general.--The Administrator of General Services 
 shall update the Federal Procurement Data System described in 
 

section 1122

    (a)

    (4) of title 41, United States Code, or any 
 successor system, to--
        (A) require reporting on whether an award under the 
 SBIR or STTR program is classified or designated as--
            (i) Phase 1A, under subsection

    (pp) of 
 

section 9 of the Small Business Act (15 U.S.C. 
 638), as amended by this Act;
            (ii) direct to Phase II, under subsection
            (cc) of such section;
            (iii) subsequent Phase II, under subsection

    (bb)

    (1) of such section;
            (iv) a strategic breakthrough award under 
 subsection

    (ff)

    (3) of such section;
            (v) a Phase III prime contract award; or
            (vi) a Phase III subcontract award;
        (B) require reporting on whether a contract is 
 designated as a Phase III contract; and
            (C) allow a Government contracting officer, when 
 recording a Phase II or Phase III contract following on 
 from work done by a small business concern during a 
 Phase I or Phase II award to reference an SBIR or STTR 
 contract identification number for relevant prior SBIR 
 or STTR work done.

    (2) No new funds.--No additional funds are authorized to be 
 appropriated for the purpose of carrying out this subsection.

SEC. 503. STREAMLINING PROGRAM ADMINISTRATION.

 

Section 9 of the Small Business Act (15 U.S.C. 638), as amended by 
this Act, is amended--

    (1) in subsection

    (bb)

    (3) , by inserting ``or another 
 component of the same Federal agency'' after ``another Federal 
 agency'';

    (2) in subsection

    (gg) --
        (A) in the heading, by striking ``Pilot Program'' 
 and inserting ``Commercialization Readiness Program'';
        (B) by striking ``pilot'' each place the term 
 appears;
            (C) by striking paragraph

    (7) ;
            (D) by redesignating paragraph

    (8) as paragraph

    (7) ; and
        (E) by amending paragraph

    (7) , as so redesignated, 
 to read as follows:
 ``

    (7) === Definition. ===
-In this subsection, the term `covered 
 Federal agency'--
 ``
        (A) means a Federal agency participating in the 
 SBIR program or the STTR program; and
 ``
        (B) does not include the Department of 
 Defense.'';

    (3) in subsection

    (hh) --
        (A) by striking ``Funding.--'' and all that follows 
 through ``Federal agencies participating'' and 
 inserting ``Funding.--Federal agencies participating''; 
 and
        (B) by striking paragraph

    (2) ;

    (4) in subsection
            (ii) (2)
        (B) --
        (A) in clause
            (ii) , by adding ``and'' at the end;
        (B) in clause
            (iii) , by striking ``; and'' and 
 inserting a period; and
            (C) by striking clause
            (iv) ;

    (5) in subsection

    (qq)

    (3) , by striking subparagraph
            (I) ;

    (6) in subsection
            (vv) (3) , by striking subparagraph
            (C) ;

    (7) in subsection

    (yy) --
        (A) in the subsection heading, by striking 
 ``Pilot'';
        (B) by striking ``STTR Program.--'' and all that 
 follows through ``Not later than'' and inserting ``STTR 
 Program.--Not later than'';
            (C) by striking paragraph

    (2) ; and
            (D) by striking ``pilot''; and

    (8) in subsection

    (zz) --
        (A) in the subsection heading, by striking 
 ``Pilot'';
        (B) in paragraph

    (1) --
            (i) in the paragraph heading, by striking 
 ``pilot'' and inserting ``program'';
            (ii) in subparagraph
        (B) , by striking 
 ``3.25'' and inserting ``3.50''; and
            (iii) in subparagraph
            (C) , by striking 
 ``0.46'' and inserting ``0.21'';
            (C) by striking paragraph

    (3) ; and
            (D) by striking ``pilot'' each place the term 
 appears.

SEC. 504. EXTENDING SBIR AND STTR AUTHORIZATION.

 

Section 9 of the Small Business Act (15 U.S.C. 638), as amended by 
this Act, is amended--

    (1) in subsection
            (m) , by striking ``2025'' and inserting 
 ``2028''; and

    (2) in subsection

    (n)

    (1)
        (A) , by striking ``2025'' and 
 inserting ``2028''.

 TITLE VI--MISCELLANEOUS

SEC. 601. TECHNICAL AMENDMENTS.

 

Section 9 of the Small Business Act (15 U.S.C. 638) is amended--

    (1) by striking ``small-business concerns'' each place it 
 appears and inserting ``small business concerns'';

    (2) by striking ``Committee on Small Business of the 
 Senate'' each place it appears and inserting ``Committee on 
 Small Business and Entrepreneurship of the Senate'';

    (3) by striking ``Committee on Science and the'' each place 
 it appears and inserting ``Committee on Science, Space, and 
 Technology and the'';

    (4) in subsection
            (d) (2) , by striking ``small-business 
 firms'' and inserting ``small business concerns'';

    (5) in subsection

    (e)

    (3) , by inserting ``concern'' after 
 ``small business'';

    (6) in subsection

    (g)

    (4)
        (A) , by striking ``SBIR proposals'' 
 and inserting ``SBIR solicitations'';

    (7) in subsection

    (g)

    (10) , by striking ``,,'' and inserting 
 ``,'';

    (8) in subsection

    (g)

    (13)
        (A) , by inserting ``malign'' 
 before ``foreign talent recruitment program'';

    (9) in subsection

    (o)

    (8) , by striking ``,,'' and inserting 
 ``,'';

    (10) in subsection

    (o)

    (17)
        (A) , by inserting ``malign'' 
 before ``foreign talent recruitment program''; and

    (11) in subsection
            (vv) (2)
        (B) , by inserting ``subsection'' 
 before ``

    (g)

    (13) ''.

SEC. 602. REPEALS.

    (a) Repeal of Obsolete Provision.--Subsection

    (tt) of 

section 9 of 
the Small Business Act (15 U.S.C. 638

    (tt) ) is repealed.

    (b) Repeal of Redundant Provision.--Subsection

    (oo) section 9 of 
the Small Business Act (15 U.S.C. 638

    (oo) ) is repealed.

SEC. 603. SEVERABILITY.

 If any provision of this Act, or the application of such provision 
to any person or circumstance, is held to be invalid, the remainder of 
the Act, and the application of the remaining provisions, shall not be 
affected.
 <all>