INNOVATE Act
Sponsored By: Representative Williams, Roger [R-TX-25]
Introduced
Summary
Would strengthen and expand SBIR and STTR programs. It would reform funding rules, add commercialization pathways, and tighten security checks on foreign ties while boosting outreach to rural and new entrant firms.
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- Small businesses and new entrants would get new commercialization paths and limits. The bill caps combined Phase I/II awards at $75 million per firm and creates a Phase 1A reserved at 1.5%–3% of SBIR funds for companies that have never held an award.
- Rural communities and prospective applicants would see more access. Agencies would have 90 days to boost targeted rural outreach, and rural ownership or residency could qualify a firm for consideration while agencies would be barred from using race, gender, or ethnicity in award decisions.
- National security and investors would face stricter rules. Agencies with SBIR budgets over $100 million would set aside at least 0.25% of extramural R&D for Strategic Breakthrough awards that can fund up to $30 million per award, and the bill would expand foreign‑risk screening and post‑award IP limits.
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Bill Overview
Analyzed Economic Effects
8 provisions identified: 4 benefits, 2 costs, 2 mixed.
Big awards to scale SBIR tech
Starting in FY2026, agencies with over $100 million in SBIR would set aside at least 0.25% of their extramural R&D for "strategic breakthrough" awards. Eligible firms must have at least one prior Phase II award and provide a 100% private match. Awards could be up to $30 million and last up to 48 months, with decisions within 90 days. Agencies could also connect awardees to SBICs and other domestic investors.
Apply straight to Phase II
Agencies could give Phase II awards without a prior Phase I if set checks are met. Most agencies could use up to 10% of SBIR funds for these awards; NIH and DoD components could use up to 30%. A firm with more than 25 prior Phase II awards could not use this path, and no firm could receive more than 25 such awards from an agency.
New Phase 1A for first-time firms
Agencies would set aside 1.5%–3% of SBIR for a new Phase 1A track open only to firms with no prior SBIR/STTR awards. These open‑topic proposals would be five pages and include a short plan to bring the idea to market. The bill would define "new entrants" and "rural area" and require stronger rural outreach within 90 days, coordinated with local SBDCs. The Pilot Program would be renamed the Commercialization Readiness Program, DoD would be excluded for that subsection, and two values would change to 3.50 and 0.21.
Extend SBIR/STTR and raise STTR floors
The programs would stay authorized through 2028. Starting in FY2026, agencies must devote at least 3.45% and at least 0.20% of the referenced budgets to STTR, as specified. Two numeric thresholds in Section 9 would also change (40 to 50; 30 to 20).
Most SBIR/STTR contracts fixed-price
Most SBIR/STTR funding agreements that are contracts would need to be firm fixed‑price. An agency head could allow a different type in writing for a specific case.
Tighter size and award limits
If your firm’s receipts were over $40 million last fiscal year, you could not apply for a Phase I SBIR award. Agencies would stop giving your firm (and affiliates) new Phase I or II awards once total Phase I/II funding reached $75 million, unless a non‑delegable national security waiver is justified in writing. One person could lead only one proposal per Phase I or per Phase II solicitation.
Stronger IP and foreign risk rules
For five years after an award, you could not sell or license SBIR/STTR‑developed IP to most foreign parties, unless they are in NATO or a major non‑NATO ally. For ten years, transfers to countries of concern would be banned. Agency heads could extend these limits for national security. SBA would share best practices to avoid IP leaks through investor informational rights. Due diligence would check listed foreign ties at closing, and GAO would report within 18 months and yearly through September 30, 2028.
Neutral review and fact-check bans
Agencies could not consider race, gender, or ethnicity in SBIR/STTR awards and could not require diversity statements or give extra funds based on them. Applicants would have to disclose any agreement with NewsGuard, Global Disinformation Index, Internews, or similar “fact‑checking” entities, and would be barred if they have one.
Sponsors & CoSponsors
Sponsor
Williams, Roger [R-TX-25]
TX • R
Cosponsors
Rep. Miller-Meeks, Mariannette [R-IA-1]
IA • R
Sponsored 8/15/2025
Roll Call Votes
No roll call votes available for this bill.
View on Congress.gov