Federal agencies participating in the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs awarded over $3 billion to small businesses in FY 2020 to develop and commercialize new technologies. Generally, Small Business Administration policy calls for businesses to be notified of an award within 90 days and to receive it within 180 days.
A new Government Accountability Office (GAO) review found that award timeliness has improved overall since FY 2017. Agencies issued 69 percent of awards within the recommended time that year, compared to 82 percent of awards that GAO reviewed for fiscal year 2020. However, 20 of the 29 agencies GAO reviewed—including 12 within DOD—have not consistently issued awards on time. Eleven agencies issued at least 50% of their awards late in 2020.
The lack of timeliness dates back at least five years: 20 agencies were routinely late during that period, issuing fewer than 90 percent of their awards on time for three or more of the five fiscal years since 2016.
Nearly all of the agencies that were routinely late in issuing awards to small businesses have taken some steps to address risks to the timeliness of their awards. Such risks included not having standardized proposal review procedures and a lack of dedicated staff to issue awards. GAO’s review found that agencies have taken some steps to improve timeliness by, for example, streamlining proposal reviews and the award contracting process. However, the watchdog said in its October 14 report that the agencies have not fully addressed the risks they identified or evaluated steps already taken and may continue to issue late awards until they do so.
GAO found that the Department of Defense (DOD) has taken some steps to improve timeliness, but it has not established a required pilot program. According to officials, DOD has not done so, in part, because it would be too difficult to standardize practices across the department. GAO found that 12 of the 13 DOD participating agencies are not consistently issuing timely awards to small businesses. Without addressing the pilot program requirements, or by not reporting to Congress if the requirements are infeasible, GAO says DOD may be missing an opportunity to obtain technologies more quickly, as well as sustain small businesses that can provide such technologies.
It is GAO’s second report this week that is critical of DOD’s work with small businesses. The other report notes how DOD is sometimes failing to implement and monitor its Small Business Strategy.
GAO noted that in FY 2020, the Defense Advanced Research Projects Agency (DARPA) worked closely with and trained SBIR/STTR contracting officers to expedite communication to small businesses about awards and also implemented a streamlined cost guidance document to aid small businesses in the application process. DARPA began these changes in FY 2020; agency officials said they would expect to see the effects on timeliness in FY 2021.
The Department of Homeland Security’s (DHS) Science and Technology Directorate met issuance timeliness recommendations for all its awards in fiscal years 2016, 2017, and 2019, though not in fiscal year 2020 (with 79 percent of its awards issued within the recommended time). According to agency officials, the decline in fiscal year 2020 was due to changes in privacy compliance documentation requirements that increased the amount of necessary paperwork and delayed awards that were under negotiation. In addition, changes in operations due to the Coronavirus Disease 2019 (COVID-19) pandemic added to these delays.
GAO has made recommendations to numerous agencies to address the shortcomings and improve timeliness. These include a recommendation to DHS’s Countering Weapons of Mass Destruction (CWMD) office to evaluate the effectiveness of steps taken to improve SBIR award timeliness and take any necessary additional steps in order to consistently meet SBA award timeliness guidelines. DHS concurred and said that by September 30, 2022 CWMD would hold quarterly status meetings regarding schedule, solicitation topics and any concerns that would delay an SBIR award where the award period exceeds 180 days. By the same date CWMD would prepare purchase request placeholder packages for potential awards earlier in the schedule so that challenges could be addressed sooner.
DOD also concurred with most of the recommendations made to it, but has not yet provided details on the steps it will take to meet them.