SBIR Policy Directive 2012
Executive Summary
B. SBIR Award Process

[Updated 8/6/12]

With respect to the SBIR 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 SBIR 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 SBIR 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 SBIR program. As required by statute, the minimum percentages increase by 0.1% each fiscal year through fiscal year 2016 and then by 0.2% in 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 SBIR 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 SBIR 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

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