SBIR Gateway

SBIR Insider Newsletter
December 31, 2006 Edition

Dear SBIR Gateway Insider,

It's been a very busy year, too complex to publish a full recap in our Insider, but I encourage you to visit our 2006 Year in Review page at . This page contains links to important documents including legislation such as Sec. 252 enabling the DoD Commercialization Pilot Program (CPP), proposed legislation such as Title XV of S.3778 (that didn't make it, but may rise again), as well as several GAO reports on SBIR and the agencies.

Although I promised you some 2007 predictions from "informed sources," we also had some questions, one of which resurfaces sometimes as a major issue. We'll start there.

In this issue:

Are SBIR Topics Wired/Rigged?

There have been claims that agencies set up some topics to be wired for a particular company. In fact, a very popular web information source known as Wikipedia (a user contributed encyclopedia often called a wiki) suggests that occasionally awardee preference exists. I have no idea who the user is that contributed the SBIR information to the Wiki but it contains some good information as well as bogus advice.

Wiki claims: In practice, some of the solicitations are put together with a specific awardee in mind.

Edsel Brown at the SBA is going to love Wiki's advice on this:

Therefore, if possible, contact with insiders in the Small Business Administration is advisable for applicants, to avoid the needless expense of preparing hopeless proposals.

This is a ludicrous statement. The SBA has nothing to do with an agency's topic formulation / selection and would have no clue if a topic was wired for a particular awardee. The wiring of a topic for an awardee is a violation of law, and if someone at SBA knew this was happening, they would be duty bound to report it.

Although it is true that several agencies occasionally solicit ideas for topics from small businesses, it is not true that topics are hard wired for award to those companies. In fact, it is not uncommon to have multiple awardees on the same phase I topic. For an example, see the Navy's SBIR web site selections page for their FY-06.1 awardees at This page not only shows several awardees for each topic, but if you click on the "Details" link, you can see the differences in companies' approaches to the topics.

Question: Is it a fair assumption that an agency may sometimes create an SBIR topic with a specific company in mind? Most insiders we polled were uncomfortable with "sometimes" but admitted to "on rare occasions." As to preferential evaluation for those companies, the answer was a resounding "No!" On the other hand, we live in a real world replete with human failings, so to infer that preferential evaluation has never happened, would be a misnomer. However, the agencies do have practices and policies to prevent this from happening, and are very strict in their adherence.

Topics in the contracts based programs (such as the DoD), tend to be very specific and responses are expected to stay focused and on target. However, in many grants based programs such as the omnibus NIH SBIR/STTR, topics are designed to be broad and inclusive. In fact, they encourage small businesses to become familiar with the mission of their institutes and submit an innovative SBIR proposal within the mission of an institute even if there is no topic listed. In the world of NIH SBIR grants, you can say that a small business can submit their own topic.

Congress and Your Future
With the exception of the DoD and DHS, all other agency appropriations are at risk. The remaining 9 appropriation bills for FY-2007 that Congress didn't complete have been rolled up into a continuing resolution that expires February 15, 2007.

Interestingly enough, during our bi-centennial in 1976, Congress changed the government fiscal year from July 1 to October 1 solely to give themselves more time to pass appropriations bills that fund the government. Now they still can't get the job done!

With Congress having to face a FY-2008 budget process in early in 2007, how are they expected to complete nine FY-2007 appropriations bills? Senator Robert Byrd (D-WV) and Congressman David Obey (D-WI), both chairs of their respective appropriations committees, are in the process of carving out a joint funding resolution to carry the government through the end of the fiscal year, September 30, 2007.

Their joint funding resolution differs from the conventional continuing resolution in that funding essentially remains flat except for some flexibility on a case-by-case basis, and all are stripped of congressional earmarks. Those who were receiving monies from earmarks in FY-2007 will most likely be shut off and have to reapply for FY-2008. Note: This does not apply to those earmarks incorporated into the DoD or DHS FY-2007 appropriation bills that were passed by the 109th Congress. The flat funding will have a negative effect for most of the science and technology community.

Although earmarks are very much out of control, many beneficial earmarks will also be cut off in midstream. It looks very much as if the remainder of FY-2007 will be tough for the agencies, but hopefully congress can do a better job of the FY-2008.

Jere W. Glover named SBIR Gateway's SBIR Person of the Year for 2006
Jere W. Glover has been a pioneering figure in SBIR since its planning stages in the late 70's. As counsel to the House Small Business Committee, Glover directed an extensive set of hearings on small business and innovation that laid the ground work for the creation of the SBIR. program. Over the years he has continued to be a leader in the preservation, growth and maturation of the SBIR and STTR programs.

As a protégé of the legendary Milton Stewart, (the first SBA Chief Counsel for Advocacy 1978-1981), Glover served as Stewart's Deputy Chief Counsel for Advocacy. Glover worked in the private sector as CEO/principal of a biotech company and a medical technology company, then back to the SBA where he served as the Chief Counsel for Advocacy from 1994-2001. In 2000 Fortune Small Business magazine listed Glover as #9 on their "Power "30" list of the most influential folks in and around the Beltway who talk your talk.

Glover's notable contributions to SBIR continued in 2006. He lead the way to reinitiate the all important Tibbetts Awards program that was suspended in late 2002 by the SBA due to severe budget constraints. Although there was no hope of SBA's ability to restart the program, Glover found a way to fund the Tibbetts Awards outside of the SBA, as an initiative of the non-profit SBTC, in cooperation with and sponsorship from several federal SBIR agencies and other corporate sponsors.

Another important contribution by Glover in 2006 was his participation in the creation of the new DoD Commercialization Pilot Program (CPP). He was a keystone figure in helping to design and get congressional support for a program that would be good for the small businesses, the agencies and the prime contractors. He worked closely with congressional staffers to fine tune the language and get the amendment incorporated into the Defense Appropriations bill of 2006.

Last, but not least of Glover's contributions for 2006 was his leadership in fighting against the Biotechnology Industry Organization (BIO) and other special interest groups seeking unfettered access to SBIR funding by ineligible VC owned and controlled entities. Glover worked with important congressional staffers to fashion a reasonable compromise but BIO always seeking to get more, backed out at the last minute, thinking they could use Senator Bond to hammer out a more leveraged deal for their special interests. BIO did not get their way in 2006, in part due to Glover's actions.

Being the Executive Director for the SBTC, you would expect that this work would all be a part of Glover's paid position. However, the SBTC position is only part time, and Glover also works as an attorney with the Brand Law Group in Washington DC, specializing in helping small businesses on SBIR related issues. In spite of his busy schedule, much of Glover's time on the SBIR issues listed above has been "off the clock" donated time, and most of us in the SBIR field have been the beneficiary of his work.

The SBIR Gateway is pleased to name Jere Glover, SBIR Person of the Year! You can view the full article including pictures at

Predictions for 2007
For the first time in several years, the SBA will see a budget increase, as part of the upcoming FY-2008 budget and SBA reauthorization bill. It's unclear if anything can be done to get an increase in the FY-2007 joint resolution.

Results of the National Academies' multi-year study of the SBIR program will be released to the agencies reflecting a mostly favorable rating on the program, noting areas needing improvement, and suggesting support for the program's reauthorization.

SBIR reauthorization chances are strengthened with the added support of the new Speaker of the House, Nancy Pelosi (D-CA), and a potentially positive report from the National Academies. The VC issue will continue to be divisive. On the Senate side, John Kerry is cautious about the BIO/Bond claims; on the House side, Velázquez is a strong supporter of the BIO/Bond stance. Former House Small Business Chair Don Manzullo (R-IL) was not a supporter of BIO/Bond.

The House Science Committee will be less supportive of an increase in the SBIR cap than the Senate SBE. They are likely to be more guarded about other SBIR enhancements that would compete for funding with other science programs. An excellent interview with Congressman Bart Gordon (D-TN) (Chairman of the House Science Committee) in last week's Federal Technology Watch, revealed that Gordon is going to set up an oversight subcommittee whose job will be to help make sure taxpayers dollars are spent more wisely.

Vinny Schaper (retired Navy SBIR program manager) currently in the private sector with SMI, will come back to his SBIR program manager roots, but this time to DHS to serve his former boss, Rear Admiral, Jay M. Cohen (USN retired), who is now the DHS Undersecretary of Homeland Security for Science and Technology. Cohen stated at his confirmation hearing, that in order to straighten out the technology problems at DHS, he would employ the same methods he used during his 6 years as Chief of the Office of Naval Research (ONR). Consequently there are several former ONR people now at DHS, and it is anticipated that Schaper will come on board in the first quarter of 2007.

NIST's Advanced Technology Program (ATP), previously laid to rest, may come back in one form or another as part of a Speaker-elect Pelosi's Democratic Innovation Agenda.

That's it for 2006! All of us at the SBIR Gateway Insider wish you Health, Happiness and Prosperity in 2007. 



Rick Shindell
SBIR Gateway
Zyn Systems
40 Alderwood Dr.
Sequim, WA 98382
[email protected]

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