SMALL BUSINESS INNOVATION AND ECONOMIC SECURITY ACT

SMALL BUSINESS INNOVATION AND ECONOMIC SECURITY ACT

Congressional Record, Volume 172 Issue 40 (Tuesday, March 3, 2026) [Congressional Record Volume 172, Number 40 (Tuesday, March 3, 2026)] [Senate] [Pages S751-S756] From the Congressional Record Online through the Government Publishing Office [ www.gpo.gov ] SMALL BUSINESS INNOVATION AND ECONOMIC SECURITY ACT Ms. ERNST. Mr. President, I rise today as the Senate puts small business first in America's innovation program and gives them the certainty they need to build and grow. For too long, our Nation's seed fund programs, SBIR and STTR, have been allowed to prioritize a few large companies over truly small businesses. Until now, these programs received blank checks to squander tax dollars meant to advance innovation in our national interest and have not protected taxpayer-funded technologies from foreign influence. When confronted with this unacceptable status quo, I knew Congress could work together to find a solution for our truly small businesses. After working across the aisle and with our small businesses, we now have the necessary reforms to strengthen America's seed fund while unleashing small businesses to deliver for taxpayers and our warfighters. Together, our bipartisan, bicameral legislation will ensure awardees safeguard tech against Chinese espionage, hold recipients accountable to actually producing cutting-edge technologies and capabilities--no more blank checks--require for the first time an annual limit on applications to prioritize truly small businesses over large companies who know how to game the system, establish the first of its kind strategic breakthrough awards, and, finally, provide taxpayers with transparency into who receives these awards. These changes were necessary, and we are taking the time to absolutely get it right. And, tonight, I am proud the Senate is unanimously passing these long-overdue updates for innovators. And at this time I would like to yield the floor to my ranking member on the Small Business Committee Senator Markey. Mr. MARKEY. Thank you, Madam Chair. Mr. President, I am so happy to come to the floor today to reopen the Small Business Innovation Research and Small Business Technology Transfer Programs. These programs deliver more than $4 billion to thousands of innovative small businesses across our country every single year. But for nearly 5 months, these programs have been shuttered. That never should have happened. In September, I came to the Senate floor seeking unanimous consent to pass H.R. 5100, a bipartisan bill sponsored by the chairs and ranking members of the Small Business Committee and House Science and Technology Committee to temporarily extend these programs while negotiations continued. Unfortunately, my motion was blocked and the programs abruptly shut down. As a result, the smallest SBIR and STTR companies were hurt. Important research and development was stalled, and jobs were lost. While I am glad to have come to an agreement, I am disappointed at the suffering that was caused by the longest shutdown in the program's history. But we did ultimately come to an agreement. That is what we bring to the floor here today. More than 40 years ago, Congress created the SBIR Program to serve four purposes: one, stimulate economic innovation; two, use America's small businesses to meet Federal research and development needs; three, to foster and encourage participation by minority and disadvantaged individuals in innovation; and, four, to increase private sector commercialization from Federal research and development. Ten years later, Congress created the STTR Program to promote collaborations between small businesses and research institutions. And since the creation of the SBIR and STTR Programs, 33,000 American small businesses have won more than $77 billion in awards. In my own home State of Massachusetts, more than $9 billion in SBIR and STTR funding has been won by more than 2,600 small businesses in Massachusetts. It has been the engine of growth out on our tech belt. The SBIR, STTR Programs have been overwhelmingly successful in supporting innovative small businesses and their technologies. This is just great news here. Data shows that 60 percent of all awardees in the past 5 years are first-time winners. The SBIR Program has returned anywhere from $22 to $33 for every $1 spent by the program that is pushed into our economy. And through SBIR and STTR funding, small businesses have created cutting-edge lifesaving medical breakthroughs. In fact--this is an unbelievable number--one out of every eight FDA- approved drugs is linked to the SBIR and STTR Programs. SBIR funding ultimately led to the creation of a drug to treat COVID- 19 infections, a medication that treats HIV infections, new treatments for Alzheimer's disease, a continuous glucose monitoring device for type 1 diabetics, and even the world's smallest heart pump--SBIR, STTR. These programs have also led to the creation of technologies we take for granted, such as GPS, wireless communications systems, and even self-automated vacuum cleaners. Simply put, the benefits of the SBIR and STTR Programs touch our lives far more than most people realize. It has unleashed a cornucopia of innovation that now is a part of every American family's lives, and we must keep this program funded and going. The American people deserve to have access to the most innovative technologies. Our brave men and women who defend our freedom deserve to be equipped with the best available technology to keep themselves and all of us at home safe as Senator Ernst said. Our families and our friends who are battling illnesses deserve access to the most effective breakthrough treatments that innovation can offer. For the Federal Government to continue investing in the most innovative technologies, SBIR and STTR funding must continue to be based purely on the strength of an idea, the best ideas our country has. That is the spirit of Darwinian paranoia-inducing competition, which is the heart of our system in our country. So now, after 5 months of the programs' lapse, I am proud that the chair and I have negotiated a bipartisan agreement that does not automatically eliminate any small business from the program. Unlike previous proposals that would have automatically kicked out more than 50 successful small businesses across 20 States and severely curtailed hundreds of small businesses, this reauthorization would allow small businesses to continue innovating and creating groundbreaking technology for our country. In an attempt to preserve quality proposals, this legislation requires each Agency with an SBIR and STTR Program to place a ceiling on the number of proposals that any small business can submit. The ceiling must be placed in one of three categories: one, a proposal limit per fiscal year; two, a proposal limit per solicitation; or, three, a proposal limit per topic. This language provides Agencies the flexibility to administer these programs in a manner that best promotes innovation. I recently met with Agency officials across the administration, including at the Pentagon, to ensure this language would not hinder the development of cutting-edge technologies to protect our country. I received assurances from the Pentagon--the largest awarding SBIR and STTR Agency--that the provision would be implemented on a per-topic basis and no company would be unfairly targeted. That means any small business can take their best shot at solving any problem the government--the NIH, the Defense Department--poses, and Agencies can secure the most innovative solutions. I will continue to hold this administration accountable and fight to maintain the merit-based nature of these programs. This reauthorization also includes several new improvements for the SBIR and STTR communities. The bill retains the bipartisan 2022 foreign due diligence program, which requires Agencies to create a process to communicate with small businesses if they have been flagged for a foreign risk, and explicitly ends the blacklisting of companies. This transparency measure allows small businesses the opportunity to address any foreign risk they pose, likely unknown to them. Two, the bill expands direct to phase II authority to the Department of Energy and the National Aeronautics and Space Administration. This will fast- [[Page S752]] track clean and cutting-edge technology. Three, the bill preserves STTR Program funding for universities and research institutions. Four, the bill directs Agencies to train contracting officers so that SBIR-STTR technologies can more effectively transition to commercialization. Five, it allows any unused fiscal year 2026 funding to be carried over so that no SBIR or STTR funding is lost as a result of the program's lapse. Therefore, that funding can be used next year. Finally, the bill reauthorizes the program until 2031, giving some stability, some reliability, some certainty to small businesses, which they need after a tumultuous 5 months. Throughout this process, I knew any agreement had to have broad support, and that is why it was so important to get input from all stakeholders and receive assurances from the implementing Agencies. So while this legislation does not include every improvement--I would like to see or make programs permanent--it is a bipartisan product that resulted from a negotiation between the chair and myself as the ranking member. The agreement now immediately reopens the programs so that we can once again stake our position on the world stage, empowering our most nimble companies in our country and our nimble allies around the world in the innovation ecosystem to partner with our brilliant small businesses to make the technological breakthroughs to put us at the cutting-edge of world leadership. I thank you, Mr. President, and I thank you, Madam Chair, for our work together. I yield the floor. The PRESIDING OFFICER. The Senator from Iowa. Ms. ERNST. Mr. President, notwithstanding rule XXII, I ask unanimous co

Referenced legislation: S3971, S3971, HR5100