S-3971 — Small Business Innovation and Economic Security Act

This bill became law on 2026-04-13 as Public Law No. 119-83.

The summary below describes the bill at the version we last reviewed; the enacted text may differ.

YourVoice.Now Summary

Civil LibertiesCorporate BenefitsTransparency & Accountability

Small-business research grants run to 2031, with new security checks and awards up to $30 million.

Civil Liberties

Reasons for a denied grant — agencies decide how much to share

When an agency turns down an application over security concerns, it must set up a way to tell the company the finding and the basis for it. The law lets the agency limit what it shares to protect national security. A denial does not bar the company from applying in a later round.

Grant denials from watch-list ties — eight federal lists now checked

Agencies must check every applicant against eight government lists, including forced-labor and Chinese military company lists. A link to a listed company, or to one of its affiliates, can be grounds to turn the application down.

Personal foreign ties reviewed — owners, key staff, and employees screened

The vetting now covers foreign ownership, loans, investments, and business ties of the company and the people who work there. It also covers licensing deals and joint ventures abroad.

Corporate Benefits

Small-business research grants — six more years, through September 30, 2031

The SBIR and STTR programs let small companies win federal research money. Their authority had run out on September 30, 2025. This law restarts them through September 30, 2031.

Single awards up to $30 million — new track for repeat winners

Agencies whose research set-aside tops $100 million may steer up to half a percent of it into these larger awards. A company must have won a past second-stage award and must match the federal money dollar for dollar. The work must finish within 48 months. The money comes out of the same pot that pays for smaller awards.

Easier follow-on contracts for grant winners — staff training now required

Federal buyers must be trained on Phase III awards, which let an agency buy from a grant winner without a new competition. Agencies must also write simpler, standard contracts and clearer rules for these purchases.

Second-stage grants without a first-stage win — Energy, NASA added

Some agencies may skip the small first-stage award and go straight to a larger second-stage one. The Department of Energy and NASA join that list, and the option now runs to September 30, 2031.

Proposals one company may send — agencies must set yearly caps

Starting in fiscal year 2027, each agency must set the same limit for every company on how many first- and second-stage proposals it may send. Agencies can waive the cap on urgent topics, but only for 5 percent of topics a year.

Transparency & Accountability

Public records of where grant money leads — follow-on contracts now tagged

The public grant database must record what type each award is, including the new $30 million awards. The government-wide contract database must also show which later contracts came out of this research.

End date on the $30 million award track — September 30, 2031

The section that creates the $30 million award track shuts off on September 30, 2031. The law it changed goes back to the way it read before, unless Congress acts again.

Watchdog study of applicant screening — due in 8 years, not 3

The 2022 law that added security vetting also ordered a Government Accountability Office study of how that vetting works. This law gives the study five more years before it is due.

Standing watchdog reports on these grants — requirement repealed

A 2012 defense law required Government Accountability Office reporting on the SBIR and STTR programs. Section 10 removes that requirement.

More about this bill

Federal research grants for small businesses now run through September 30, 2031. The two programs, SBIR and STTR, had lapsed on September 30, 2025. If you do not own or work at a company that seeks these grants, you will see no change. Agencies may also carry unspent 2026 grant money into 2027. Agencies must now check each applicant against eight federal watch lists. These cover forced labor, firms tied to the Chinese military, and banned telecom gear. The review also looks at the foreign money ties and business links of owners, key staff, and employees. An agency may deny an award over those ties. It must set up a way to tell the firm the basis for that denial. It can still hold back anything that would expose secrets. A denial does not block the firm from applying again. A new track lets an agency give one company up to $30 million over four years. Only firms with a past second-stage award and dollar-for-dollar matching money qualify. Agencies with research budgets above $100 million may spend up to half a percent of that budget this way. This track ends on September 30, 2031. Starting in 2027, each agency must also cap how many proposals one company can send in a year. Public records must now show which later contracts grew out of these grants.

Congressional Summary

Small Business Innovation and Economic Security ActThis act reauthorizes through FY2031 and modifies the Small Business Innovation Research (SBIR) program, the Small Business Technology Transfer (STTR) program, and related pilot programs. (The SBIR and STTR programs are administered by various federal agencies and provide competitive awards for domestic small businesses to conduct research and development projects that have the potential for commercialization.)Specifically, the act expands the requirements for federal agencies administering these programs to evaluate the security risks of the small businesses that apply for awards under the programs. If an agency denies an application for security reasons, the agency must provide the small business with the basis for such determination.Further, each agency must set a maximum number of proposals per fiscal year that a small business concern may submit in response to Phase I and Phase II solicitations.The act expands the training requirements for agencies' contracting officers and acquisition workforce with respect to Phase III (commercialization of technologies) awards under the SBIR and STTR programs.The act also establishes strategic breakthrough allocations for critical technology areas. These are additional Phase II SBIR and STTR awards to small businesses that demonstrate an effective technology and receive matching funds.

Legislative Subjects

Advanced technology and technological innovationsAsiaChinaComputer security and identity theftComputers and information technologyData collection, sharing, protectionGovernment lending and loan guaranteesIntellectual propertyMilitary assistance, sales, and agreementsPerformance measurementPublic contracts and procurementResearch administration and fundingResearch and developmentSmall Business AdministrationSmall businessSubversive activitiesTechnology assessmentTechnology transfer and commercialization

Details

Congress: 119th
Chamber: Senate
Status: summarized
Action: Public Law
Action Date: 2026-04-13
Date Added: 2026-05-21
Source: Congress.gov →

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