Business research

Small business research programs: scholarship awards from many agencies are not made in a timely manner; Certain practices can improve punctuality

What the GAO found

In fiscal year 2019, many agencies that participate in the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs were not always on time to notify winners or award prizes, similar to fiscal years 2016 through 2018, which GAO had previously reviewed. For notification, 15 of the 29 participating agencies met the timeliness requirement (90 calendar days for most agencies) for at least 90% of their grants, while 14 did not. For awarding grants, 10 agencies met the timeliness recommendation (180 calendar days for most agencies) for at least 90% of their grants, and 19 did not. See figure for details.

Percentage of small business awards issued within recommended timelines for FY19

Note: The Small Business Administration’s SBIR/STTR policy guideline recommends that the National Institutes of Health and the National Science Foundation issue awards within 15 months, rather than the 180 days recommended for all other agencies.

Agencies use a variety of practices that they believe help to improve the timeliness of applicant notification and the issuance of SBIR and STTR scholarships. GAO found that for three practices – using internal officials to review applications, using dedicated procurement officers to award contracts, and developing strategies to deal with funding issues – participating agencies may be more likely to comply with timeliness requirements or recommendations if they use the practices.

Why GAO Did This Study

Federal agencies awarded nearly $3 billion in SBIR and STTR awards in fiscal year 2019 to help small businesses develop and commercialize technology. Under both of these programs, participating organizations solicit proposals at least once a year, review proposals to determine which small businesses should receive awards, and notify applicants whether they will receive an award. According to the SBA, the timely issuance of awards — of which there were more than 7,000 in fiscal year 2019 — can affect how quickly small businesses receive funds and can start working.

The SBA’s SBIR/STTR Policy Directive provides requirements for how long participating agencies should take to notify applicants of their decision, as well as recommendations for how long agencies should take to issue awards. The John S. McCain National Defense Authorization Act for fiscal year 2019 includes a provision that the GAO must report annually for 4 years on the timeliness of reviews of agency proposals and awards. This report, the second, examines (1) the timeliness with which participating agencies notified applicants and issued SBIR and STTR grants in fiscal year 2019 and (2) the practices participating agencies used to improve timeliness.

GAO analyzed attribution data, reviewed documentation, and interviewed officials from the SBA and the 29 agencies participating in the SBIR and STTR programs in fiscal year 2019.

For more information, contact Candice N. Wright at (202) 512-6888 or [email protected]