Small Business Innovation Research Program

Public Roads, March-April, 1998 by Charles W. Niessner

* Stimulate small business innovation.

* Use small businesses to meet federal R&D needs.

* Foster and encourage participation in technological innovation by minority and disadvantaged persons.

* Increase private sector commercialization of innovations derived from federal R&D.

The 1982 act required each of the 11 federal agencies with extramural R&D budgets in excess of $100 million per year to allocate a small percentage of that budget to fund an SBIR program. The percentage allocation was phased in to 1.25 percent by fiscal year 1987.

In 1992, with the passage of the Small Business Research and Development Enhancement Act (Public Law 102-564), Congress significantly expanded the SBIR Program and sharpened the program's emphasis on private sector commercialization. The 1992 act boosted the SBIR percentage allocation from 1.25 percent in fiscal year (FY) 1992 to 1.5 percent in FY 1993 and FY 1994, to 2 percent in FY 1995 and FY 1996, and to 2.5 percent in FY 1997 and thereafter.

The Federal Highway Administration (FHWA) and the other modal administrations within the Department of Transportation (DOT) participate in the SBIR Program. DOT's SBIR Program is coordinated by the Research and Special Programs Administration (RSPA) at the Volpe National Transportation Systems Center in Cambridge, Mass. Joseph Henebury is the director of DOT's SBIR Program.

The SBIR Process

The SBIR Program in DOT is a competitive contract award process with three phases. Phase I is the conduct of feasibility-related experimental or theoretical research. The maximum value of an award is $100,000; however, each agency may set lower values. The period of performance for these research studies may be up to six months. The primary bases for the award are the scientific and technical merit of the proposal and its relevance to DOT requirements.

Phase II is the principal research or R&D effort. Only Phase I awardees are eligible to participate in Phase II. Phase II awards have a period of performance of approximately two years with a maximum dollar value of $750,000. Again, each agency has the prerogative to limit the dollar value to a lesser amount. FHWA currently sets its maximum award at $500,000.

Phase III is conducted by the small business with either federal or non-federal funds to pursue commercial applications of the research funded in Phases I and II. SBIR funds cannot be used for this phase.

Annually, each modal administration within DOT develops problem statements for the SBIR Program. In February, DOT distributes its solicitation for Phase I proposals. Proposals are due the first week in May, and they are evaluated by the technical office within FHWA that submitted the problem statement. The evaluations and recommendations for contract awards are forwarded to RSPA. Contract awards are usually made in September or October of each year.

Upon completion of the Phase I contract, the small business may submit a Phase II proposal. The Phase II proposal will be evaluated by the technical office, which makes a recommendation to RSPA on whether or not to award a contract. If the recommendation is favorable, RSPA will negotiate and award the contract.

The SBIR Program

Since 1983, FHWA's SBIR Program has steadily increased (with a few minor dips) in dollar value (see table 1) and the number of contracts awarded. This is the result of two occurrences - the increased percentage allocation for SBIR and the increase in the FHWA research budget. During the program's 15 years of existence, 90 Phase I and 51 Phase II contracts have been funded by FHWA.

Awards have been made in almost all areas of the highway research program: pavements; structures; safety; traffic; and, in recent years, intermodal studies. As with all research programs, some efforts have been more successful than others.

One of the first SBIR studies investigated combining permanently tied-back elements with soil nailing to enable the construction of retaining walls in soils and soft rock. Another early study involved the development of a radar traffic monitor to replace the loop detectors at signalized intersections. Later efforts were directed at the development of new coatings for steel bridges, measurement of the retroreflectivity of pavement markings, fiber-reinforced dowel bars for pavements, and the use of new materials for roadside safety hardware. More recently, the studies have been concerned with such topics as automated reduction of video-based data, use of the Geographical Information System (GIS) in transportation planning, comprehensive intermodal freight transportation visual database, and fatigue-crack detection using remote sensing.

Results

In addition to developing products that the highway community can use, another objective of the SBIR Program is to provide to the private sector an opportunity to commercialize these products. The following randomly selected projects provide a cross section of the types of products that have been developed under the SBIR Program.

Table 1 - SBIR Funding Levels

FISCAL YEAR              FUNDING

1983                     $96,600
1984                     266,400
1985                     547,000
1986                     569,400
1987                     641,200
1988                     651,300
1989                     752,413
1990                   1,228,425
1991                   1,058,587
1992                   1,465,913
1993                   2,481,575
1994                   3,230,820
1995                   4,305,880
1996                   4,243,010
1997                6,054,775(*)

* Estimated amount based on estimated FY 1997 extramural R&D budget.