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TITLE VIII--ACQUISITION POLICY, ACQUISITION MANAGEMENT, AND RELATED MATTERS

Subtitle G—Small Business Matters

P. L. 117-81

Joint Explanatory Statement

(a) In General.--Not later than 10 days after the date on which the budget of the President for fiscal years 2022 through 2032 is submitted to Congress pursuant to section 1105 of title 31, United States Code, each Secretary of a military department and the Under Secretary of Defense for Research and Engineering shall submit to the Secretary of
Defense, the Chairman of the Joint Chiefs of Staff, and the congressional defense committees a report on unfunded priorities of the Department of Defense related to high-priority Small Business Innovation Research and Small Business Technology Transfer projects.

(b) Elements.--

(1) In general.--Each report under subsection (a) shall include identification of not more than five unfunded priority projects and the following information for each such unfunded priority project:

(A) A summary description of the unfunded priority project, including the objectives to be achieved if such project were to be funded (either in whole or in part).

(B) The additional amount of funds recommended to achieve the objectives identified under subparagraph (A).

(C) Account information with respect to such unfunded priority project, including, as applicable, the following:

(i) Line item number, in the case of applicable procurement accounts.

(ii) Program element number, in the case of applicable research, development, test, and evaluation accounts.

(iii) Subactivity group, in the case of applicable operation and maintenance accounts.

(2) Priority.--Each Secretary of a military department and the Under Secretary of Defense for Research and Engineering shall ensure that the unfunded priorities covered by a report submitted under subsection (a) are listed in the order of urgency of priority.

(c) Definitions.--In this section:

(1) Unfunded priority.--The term ``unfunded priority'', with respect to a fiscal year, means a specific project related to a project successfully funded under Phase II of the Small Business Innovation Research or Small Business Technology Transfer program
that--

(A) is not funded in the budget of the President for that fiscal year, as submitted to Congress pursuant to section 1105 of title 31, United States Code;

(B) has the potential to--

(i) advance the national security capabilities of the United States;

(ii) provide new technologies or processes, or new applications of existing technologies or processes, that will enable new alternatives to existing programs; and

(iii) provide future cost savings; and

(C) would have been recommended for funding through the budget referred to in subparagraph (A) if--

(i) additional resources had been available to fund the program, activity, or mission requirement to which the specific project relates; or

(ii) the program, activity, or mission requirement for such specific project had emerged before the budget was formulated.

(2) Phase ii; small business innovation research; small business technology transfer.--The terms ``Phase II'', ``Small Business Innovation Research'', and ``Small Business Technology Transfer'' have the meanings given such terms, respectively, in section 9(e) of the Small Business Act (15 U.S.C. 638(e)).

The House bill contained a provision (sec. 842) that would direct the Secretary of Defense and the Secretaries of the military departments to each carry out a pilot program to more effectively transition Small Business Innovation Research (SBIR) programs and Small Business Technology Transfer (STTR) programs into Phase III. This provision would direct the Secretaries to each designate five completed Phase II programs to include in the next future years defense program as Entrepreneurial Innovation Projects, and to consider them as part of the Department of Defense's planning, programming, budgeting, and execution process. The Secretary of Defense would be responsible for submitting a report annually to the congressional defense committees on the programs selected for the duration of the 5-year pilot.

The Senate amendment contained a similar provision (sec. 5803).

The agreement includes the House provision with an amendment that would direct the Secretary of Defense to provide an unfunded priorities list for successful SBIR and STTR
projects, along with the annual budget request.

H. R. 4350--House Report 117-118

Section 842--Designating Certain SBIR and STTR Programs as Entrepreneurial Innovation Projects

This section would direct the Secretary 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 Projects, and to consider them as part of the Department of Defense's planning, programming, budgeting, and execution process. The Secretary of Defense would be responsible for submitting a report annually to the congressional defense committees on the programs selected for the duration of the 5-year pilot.

S. 2792--Senate Report117-39

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