Science and Technology:

Implementing the Small Business Innovation Development Act--The First 2 Years

RCED-86-13: Published: Oct 25, 1985. Publicly Released: Oct 25, 1985.

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GAO reported on the implementation of the Small Business Innovation Development Act, including the extent to which: (1) agencies established, funded, and provided accurate information on small business innovation research (SBIR) activities; and (2) the Small Business Administration (SBA) and the Office of Science and Technology Policy (OSTP) carried out program coordination, monitoring, and congressional reporting duties mandated by the act. The act requires that each agency that spends more than $100 million annually on extramural research establish an SBIR program and each agency that spends more than $20 million annually on research establish non-SBIR research funding goals for small businesses.

GAO found that, through fiscal year (FY) 1984: (1) 11 of the 12 agencies that were required to establish SBIR programs did so; (2) the agencies made about 2,100 SBIR awards totalling $156 million; (3) most of the agencies reported compliance based on SBIR obligational authority, rather than on actual extramural obligations, because a reporting deadline established by the act conflicted with agencies' deadlines for making budget submissions to the Office of Management and Budget (OMB); and (4) most agencies either met or came close to meeting their required SBIR percentages. GAO also found that: (1) most of the agencies required to have non-SBIR goals did not provide SBA with all of the data necessary to ensure compliance with the act; (2) in FY 1984, the amount of total research and development (R&D) dollars that agencies reported to SBA differed from the amount reported in the President's budget; (3) SBA has issued policy guidance, publicized the SBIR program, coordinated agencies' issuance of SBIR solicitations, and monitored and reported agencies' implementation efforts; and (4) while OSTP has monitored agency implementation and reported to Congress as required by the act, it has not assessed the quality of research performed under SBIR programs, as Congress apparently intended.

Status Legend:

More Info
  • Review Pending-GAO has not yet assessed implementation status.
  • Open-Actions to satisfy the intent of the recommendation have not been taken or are being planned, or actions that partially satisfy the intent of the recommendation have been taken.
  • Closed-implemented-Actions that satisfy the intent of the recommendation have been taken.
  • Closed-not implemented-While the intent of the recommendation has not been satisfied, time or circumstances have rendered the recommendation invalid.
    • Review Pending
    • Open
    • Closed - implemented
    • Closed - not implemented

    Matter for Congressional Consideration

    Matter: When it comes up for reauthorization, Congress should amend section 4 of the act to clarify application of the criterion for determining which agencies must establish non-SBIR goals for research funding agreements with small businesses. Specifically, Congress should resolve the ambiguity by making it clear that whether an agency needs to establish goals should be determined annually by applying the stated criterion.

    Status: Closed - Not Implemented

    Comments: Legislation was reauthorized in 1986 by P.L. 99-443, but the recommended change was not adopted.

    Recommendations for Executive Action

    Recommendation: To permit proper determination of compliance with the funding provisions of the act, the heads of appropriate agencies with SBIR programs should report actual FY extramural R&D obligations, rather than estimates, to SBA.

    Agency Affected: Department of the Interior

    Status: Closed - Implemented

    Comments: The National Aeronautics and Space Administration (NASA) reported actual obligations and the data was published in the SBA Annual Report for FY 1985.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should reassess their respective agencies' reports to OMB and SBA for FY 1983 and FY 1984, make them consistent, and instruct the appropriate officials to take steps to ensure the consistency of these reports in the future.

    Agency Affected: Department of Transportation

    Status: Closed - Implemented

    Comments: Data reported to SBA are consistent with OMB data.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should reassess their respective agencies' reports to OMB and SBA for FY 1983 and FY 1984, make them consistent, and instruct the appropriate officials to take steps to ensure the consistency of these reports in the future.

    Agency Affected: National Aeronautics and Space Administration

    Status: Closed - Implemented

    Comments: Data reported to SBA are consistent with OMB data.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should reassess their respective agencies' reports to OMB and SBA for FY 1983 and FY 1984, make them consistent, and instruct the appropriate officials to take steps to ensure the consistency of these reports in the future.

    Agency Affected: Department of Transportation

    Status: Closed - Implemented

    Comments: The Department of Health and Human Services (HHS) established a procedure to be applied in the FY 1985 report to SBA, in March 1986, by which the official preparing the report will be provided the figures reported to OMB so that he can ensure consistency. HHS reassessed the FY 1983 and 1984 reports and reported revised data to SBA in March 1986.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should reassess their respective agencies' reports to OMB and SBA for FY 1983 and FY 1984, make them consistent, and instruct the appropriate officials to take steps to ensure the consistency of these reports in the future.

    Agency Affected: Nuclear Regulatory Commission

    Status: Closed - Implemented

    Comments: Data reported to SBA are consistent with OMB data.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should reassess their respective agencies' reports to OMB and SBA for FY 1983 and FY 1984, make them consistent, and instruct the appropriate officials to take steps to ensure the consistency of these reports in the future.

    Agency Affected: Environmental Protection Agency

    Status: Closed - Implemented

    Comments: The Department of Agriculture (USDA) reassessed the FY 1983 and 1984 reports, resulting in revisions to figures that had been reported to SBA.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should reassess their respective agencies' reports to OMB and SBA for FY 1983 and FY 1984, make them consistent, and instruct the appropriate officials to take steps to ensure the consistency of these reports in the future.

    Agency Affected: Department of Defense

    Status: Closed - Implemented

    Comments: DOE completed its reassessment of the reports by December 15, 1986, and no revisions to the prior reports were necessary. A change in the due date for the SBA report will permit consistent future reporting.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should reassess their respective agencies' reports to OMB and SBA for FY 1983 and FY 1984, make them consistent, and instruct the appropriate officials to take steps to ensure the consistency of these reports in the future.

    Agency Affected: Department of Defense

    Status: Closed - Implemented

    Comments: Data reported to SBA are consistent with OMB data.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should reassess their respective agencies' reports to OMB and SBA for FY 1983 and FY 1984, make them consistent, and instruct the appropriate officials to take steps to ensure the consistency of these reports in the future.

    Agency Affected: Department of Transportation

    Status: Closed - Implemented

    Comments: Data reported to SBA are consistent with OMB data.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should reassess their respective agencies' reports to OMB and SBA for FY 1983 and FY 1984, make them consistent, and instruct the appropriate officials to take steps to ensure the consistency of these reports in the future.

    Agency Affected: Small Business Administration

    Status: Closed - Implemented

    Comments: Data reported to SBA are consistent with OMB data.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should reassess their respective agencies' reports to OMB and SBA for FY 1983 and FY 1984, make them consistent, and instruct the appropriate officials to take steps to ensure the consistency of these reports in the future.

    Agency Affected: Small Business Administration

    Status: Closed - Implemented

    Comments: Interior dropped out of the SBIR program, as of the end of FY 1985, since its extramural R&D budget has been reduced and no longer meets the criterion for participation.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should reassess their respective agencies' reports to OMB and SBA for FY 1983 and FY 1984, make them consistent, and instruct the appropriate officials to take steps to ensure the consistency of these reports in the future.

    Agency Affected: Congress

    Status: Closed - Implemented

    Comments: The National Science Foundation (NSF) reassessed the FY 1983 and 1984 reports, resulting in minor revisions to figures that had been reported to SBA. The revised reporting date of March 1986 will permit consistent reporting in the future.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should reassess their respective agencies' reports to OMB and SBA for FY 1983 and FY 1984, make them consistent, and instruct the appropriate officials to take steps to ensure the consistency of these reports in the future.

    Agency Affected: United States Agency for International Development

    Status: Closed - Implemented

    Comments: Data reported to SBA are consistent with OMB data.

    Recommendation: The Administrators of the Agency for International Development (AID) and the Veterans Administration (VA) should submit data for FY 1983 and FY 1984 regarding non-SBIR goals to SBA, in accordance with requirements contained in the act and the SBA policy directive.

    Agency Affected: Department of Energy

    Status: Closed - Implemented

    Comments: AID provided data to SBA.

    Recommendation: The Administrators of the Agency for International Development (AID) and the Veterans Administration (VA) should submit data for FY 1983 and FY 1984 regarding non-SBIR goals to SBA, in accordance with requirements contained in the act and the SBA policy directive.

    Agency Affected: Nuclear Regulatory Commission

    Status: Closed - Implemented

    Comments: VA provided necessary data to SBA.

    Recommendation: To permit proper determination of compliance with the funding provisions of the act, the heads of appropriate agencies with SBIR programs should report actual FY extramural R&D obligations, rather than estimates, to SBA.

    Agency Affected: Nuclear Regulatory Commission

    Status: Closed - Implemented

    Comments: The Nuclear Regulatory Commission (NRC) is reporting actual obligations data to SBA.

    Recommendation: To permit proper determination of compliance with the funding provisions of the act, the heads of appropriate agencies with SBIR programs should report actual FY extramural R&D obligations, rather than estimates, to SBA.

    Agency Affected: United States Agency for International Development

    Status: Closed - Implemented

    Comments: The Department of Transportation (DOT) reported actual obligations for FY 1986.

    Recommendation: To permit proper determination of compliance with the funding provisions of the act, the heads of appropriate agencies with SBIR programs should report actual FY extramural R&D obligations, rather than estimates, to SBA.

    Agency Affected: Tennessee Valley Authority

    Status: Closed - Implemented

    Comments: The Department of Energy (DOE) reported actual obligations and the data was published in the SBA Annual Report for FY 1985.

    Recommendation: To permit proper determination of compliance with the funding provisions of the act, the heads of appropriate agencies with SBIR programs should report actual FY extramural R&D obligations, rather than estimates, to SBA.

    Agency Affected: Department of Education

    Status: Closed - Not Implemented

    Comments: The Department of the Interior is no longer subject to the referenced provisions of the act.

    Recommendation: To permit proper determination of compliance with the funding provisions of the act, the heads of appropriate agencies with SBIR programs should report actual FY extramural R&D obligations, rather than estimates, to SBA.

    Agency Affected: Veterans Administration

    Status: Closed - Implemented

    Comments: The Department of Defense (DOD) is reporting actual obligations data to SBA.

    Recommendation: To permit proper determination of compliance with the funding provisions of the act, the heads of appropriate agencies with SBIR programs should report actual FY extramural R&D obligations, rather than estimates, to SBA.

    Agency Affected: Smithsonian Institution

    Status: Closed - Implemented

    Comments: The Environmental Protection Agency (EPA) is reporting actual obligations data to SBA.

    Recommendation: To permit proper determination of compliance with the funding provisions of the act, the heads of appropriate agencies with SBIR programs should report actual FY extramural R&D obligations, rather than estimates, to SBA.

    Agency Affected: Department of Agriculture

    Status: Closed - Implemented

    Comments: Education is reporting actual obligations data to SBA.

    Recommendation: The Secretary of Defense should determine definitively which, if any, activities funded under the Operational Systems Development category of the DOD Research, Development, Testing, and Evaluation appropriations conform to the common definition used in reporting R&D funding under the act, the National Science Foundation's (NSF) annual survey of federal R&D funds, and the special analysis of R&D funds in the President's budget. The Secretary should then instruct the responsible DOD officials to consistently apply the Secretary's determination when reporting R&D funding data to the three recipients.

    Agency Affected: National Aeronautics and Space Administration

    Status: Closed - Not Implemented

    Comments: Congress amended the act in P.L. 99-443. As amended, the act now excludes the Operational Systems Development category.

    Recommendation: The Secretary of Transportation should, beginning in FY 1985, include all R&D obligations, regardless of the year during which they were appropriated, when reporting annual extramural R&D funding data to SBA for purposes of the act.

    Agency Affected: Department of Energy

    Status: Closed - Implemented

    Comments: DOT is reporting actual obligations data to SBA.

    Recommendation: The Administrator, SBA, should revise the SBA policy directive containing reporting requirements for SBIR program data to require agencies to report extramural R&D obligations rather than extramural R&D budget authority.

    Agency Affected: Department of Defense

    Status: Closed - Implemented

    Comments: SBA revised the policy directive as recommended, SOP-65-01-2, effective October 30, 1985.

    Recommendation: The Administrator, SBA, should revise the deadline for agencies' reporting of this data to March 1 of each year, the deadline for agencies reporting the same data to NSF.

    Agency Affected: Environmental Protection Agency

    Status: Closed - Implemented

    Comments: SBA revised the policy directive as recommended, SOP-65-01-2, effective October 30, 1985.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should reassess their respective agencies' reports to OMB and SBA for FY 1983 and FY 1984, make them consistent, and instruct the appropriate officials to take steps to ensure the consistency of these reports in the future.

    Agency Affected: Veterans Administration

    Status: Closed - Implemented

    Comments: The Department of Commerce reassessed the FY 1983 and 1984 reports to SBA and made them consistent with reports to OMB. Commerce established a procedure for bureaus to review and verify reports before they are sent to SBA.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should reassess their respective agencies' reports to OMB and SBA for FY 1983 and FY 1984, make them consistent, and instruct the appropriate officials to take steps to ensure the consistency of these reports in the future.

    Agency Affected: Department of Justice

    Status: Closed - Implemented

    Comments: Data reported to SBA are consistent with OMB data.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should, after reviewing OMB and SBA reports, provide SBA with revised non-SBIR goals data, where necessary.

    Agency Affected: Department of Defense

    Status: Closed - Implemented

    Comments: Data reported to SBA are consistent with OMB data.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should instruct the appropriate officials in their respective agencies to establish goals known to officials responsible for awarding external R&D funds.

    Agency Affected: Department of the Interior

    Status: Closed - Implemented

    Comments: NASA has notified officials of goals.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should instruct the appropriate officials in their respective agencies to establish goals known to officials responsible for awarding external R&D funds.

    Agency Affected: Department of Agriculture

    Status: Closed - Implemented

    Comments: NRC has notified officials of goals.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should instruct the appropriate officials in their respective agencies to establish goals known to officials responsible for awarding external R&D funds.

    Agency Affected: National Aeronautics and Space Administration

    Status: Closed - Implemented

    Comments: The Tennessee Valley Authority (TVA) has notified appropriate officials of goals.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should instruct the appropriate officials in their respective agencies to establish goals known to officials responsible for awarding external R&D funds.

    Agency Affected: National Science Foundation

    Status: Closed - Implemented

    Comments: DOT has briefed agency officials on goals.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should instruct the appropriate officials in their respective agencies to establish goals known to officials responsible for awarding external R&D funds.

    Agency Affected: Department of Health and Human Services

    Status: Closed - Implemented

    Comments: EPA issued letters to officials informing them of goals.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should instruct the appropriate officials in their respective agencies to establish goals known to officials responsible for awarding external R&D funds.

    Agency Affected: Department of Transportation

    Status: Closed - Implemented

    Comments: AID has briefed agency officials on goals.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should instruct the appropriate officials in their respective agencies to establish goals known to officials responsible for awarding external R&D funds.

    Agency Affected: Smithsonian Institution

    Status: Closed - Implemented

    Comments: Education sent a notice to appropriate officials informing them of goals.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should instruct the appropriate officials in their respective agencies to establish goals known to officials responsible for awarding external R&D funds.

    Agency Affected: Department of Commerce

    Status: Closed - Implemented

    Comments: Appropriate agency officials were briefed on goals.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should instruct the appropriate officials in their respective agencies to establish goals known to officials responsible for awarding external R&D funds.

    Agency Affected: Tennessee Valley Authority

    Status: Closed - Implemented

    Comments: The Smithsonian has notified appropriate officials of goals.

    Recommendation: The Administrator, SBA, should recompute agencies' non-SBIR goals using revised data for FY 1983 or FY 1984 that agencies provide to SBA after reviewing previously submitted data for consistency with data reported to OMB. SBA should also use the recomputed FY 1983 goals as the baseline data against which to evaluate goal achievement in subsequent years.

    Agency Affected: Small Business Administration

    Status: Closed - Implemented

    Comments: SBA has recomputed goals based on submission of revised data, as available.

    Recommendation: The Administrator, SBA, should change the due date for agencies' submission of non-SBIR goal reports to the end of January to coincide with agencies' budget submissions to OMB.

    Agency Affected: Small Business Administration

    Status: Closed - Implemented

    Comments: SBA revised the due date to March 15, 1986, through a change to its policy directive, SOP-65-01-2, effective October 30, 1985.

    Recommendation: The Administrator, SBA, should revise the SBA policy directive containing reporting requirements for non-SBIR goals to require agencies to report total R&D dollar obligations, rather than total R&D budget authority.

    Agency Affected: Congress

    Status: Closed - Implemented

    Comments: SBA made the recommended revision to the policy directive, SOP-65-01-2, effective October 30, 1985.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should instruct the appropriate officials in their respective agencies to establish goals known to officials responsible for awarding external R&D funds.

    Agency Affected: Department of Transportation

    Status: Closed - Implemented

    Comments: USDA informed officials of goals.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should, after reviewing OMB and SBA reports, provide SBA with revised non-SBIR goals data, where necessary.

    Agency Affected: Environmental Protection Agency

    Status: Closed - Not Implemented

    Comments: Data provided to SBA are consistent with OMB data.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should, after reviewing OMB and SBA reports, provide SBA with revised non-SBIR goals data, where necessary.

    Agency Affected: Department of Commerce

    Status: Closed - Not Implemented

    Comments: USDA has provided revised data to SBA.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should, after reviewing OMB and SBA reports, provide SBA with revised non-SBIR goals data, where necessary.

    Agency Affected: Environmental Protection Agency

    Status: Closed - Implemented

    Comments: NSF had provided revised data to SBA as of December 30, 1985.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should, after reviewing OMB and SBA reports, provide SBA with revised non-SBIR goals data, where necessary.

    Agency Affected: Department of the Interior

    Status: Closed - Implemented

    Comments: DOE provided revised data to SBA, which is contained in the SBA Annual Report for FY 1985.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should, after reviewing OMB and SBA reports, provide SBA with revised non-SBIR goals data, where necessary.

    Agency Affected: Department of Transportation

    Status: Closed - Implemented

    Comments: Data reported to SBA are consistent with OMB data.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should, after reviewing OMB and SBA reports, provide SBA with revised non-SBIR goals data, where necessary.

    Agency Affected: Department of Health and Human Services

    Status: Closed - Implemented

    Comments: Data provided to SBA are consistent with OMB data.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should, after reviewing OMB and SBA reports, provide SBA with revised non-SBIR goals data, where necessary.

    Agency Affected: Department of Agriculture

    Status: Closed - Implemented

    Comments: Commerce sent the revised data to SBA on December 20, 1985.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should, after reviewing OMB and SBA reports, provide SBA with revised non-SBIR goals data, where necessary.

    Agency Affected: National Science Foundation

    Status: Closed - Implemented

    Comments: Data reported to SBA are consistent with OMB data.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should, after reviewing OMB and SBA reports, provide SBA with revised non-SBIR goals data, where necessary.

    Agency Affected: Nuclear Regulatory Commission

    Status: Closed - Implemented

    Comments: Interior dropped out of the SBIR program, as of the end of FY 1985, since its extramural R&D budget has been reduced and no longer meets the criterion for participation.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should, after reviewing OMB and SBA reports, provide SBA with revised non-SBIR goals data, where necessary.

    Agency Affected: Department of Energy

    Status: Closed - Implemented

    Comments: Data reported to SBA are consistent with OMB data.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should, after reviewing OMB and SBA reports, provide SBA with revised non-SBIR goals data, where necessary.

    Agency Affected: Department of Defense

    Status: Closed - Implemented

    Comments: Data reported to SBA are consistent with OMB data.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should, after reviewing OMB and SBA reports, provide SBA with revised non-SBIR goals data, where necessary.

    Agency Affected: National Aeronautics and Space Administration

    Status: Closed - Implemented

    Comments: Data reported to SBA are consistent with OMB data.

    Recommendation: The heads of applicable agencies subject to the non-SBIR goals provisions of the act should, after reviewing OMB and SBA reports, provide SBA with revised non-SBIR goals data, where necessary.

    Agency Affected: Smithsonian Institution

    Status: Closed - Implemented

    Comments: Data provided to SBA are consistent with OMB data.

    Recommendation: OSTP should expand its oversight of agencies' SBIR programs by using the Federal Coordinating Council for Science, Engineering, and Research to monitor the SBIR programs in terms of research quality.

    Agency Affected: Veterans Administration

    Status: Closed - Not Implemented

    Comments: P.L. 97-219 required GAO to report on research quality.

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