Congress is at work on the 2022 National Defense Authorization Act–major annual legislation that often includes significant changes to the laws impacting government contractors.

This year’s NDAA promises to be no different. Among potential changes: the House Subcommittee on Cyber, Innovative Technologies, and Information Systems has proposed to establish a pilot program to help transition more Phase II SBIR/STTR awardees to Phase III.

The Subcommittee proposes to add a Section 822 to the upcoming 2022 NDAA. Section 822 would be named “Designating Certain SBIR and STTR Programs as Entrepreneurial Innovation Projects.” The Subcommittee explains its proposal as follows:

This section would direct the Secretaries of Defense and the Secretaries of the military departments to each carry out a pilot program to more effectively transition Small Business Innovation Research programs and Small Business Technology Transfer programs into Phase III. This section would direct the Secretaries to each designate five completed Phase II programs to include in the next Future Years Defense Program as Entrepreneurial Innovation Programs, and to consider them as part of the Department of Defense’s planning, programming, budgeting and executive process. The Secretary of Defense would be responsible for submitting a report annually to the congessional defense committees on the programs selected for the duration of the 5-year pilot.

Achieving a Phase III award is, of course, the goal of every SBIR and STTR awardee–but for many Phase I and II awardees, Phase III can prove elusive. If it becomes part of the final NDAA, this pilot program may help a few more awardees reach Phase III–and, as a “pilot,” could serve as the genesis of a broader initiative if it is successful.

The House Armed Services Committee is scheduled to consider this proposal on September 1. We will keep you posted on this proposal and other relevant portions of the 2022 NDAA as Congress’s work progresses.

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