Small Business Innovative Research Program (SBIR)

Providing grants for feasibility studies and product research and development to small businesses

Ten federal agencies grant funds from the USDA's Small Business Innovation Research (SBIR) program. The program provides competitive research funding for qualified small businesses developing products, processes and services for the diverse communities served by the USDA.

The objectives of the SBIR Program are to stimulate technological innovations in the private sector, strengthen the role of small businesses in meeting federal research and development needs, increase private sector commercialization of innovations derived from USDA-supported research and development efforts, and foster and encourage participation by women-owned and socially and economically disadvantaged small business firms in technological innovations.

Research topic categories of the SBIR program include: forests and related resources; plant production and protection; animal production and protection; air, water, and soils; food science and nutrition; rural and community development; aquaculture; industrial applications; marketing and trade; wildlife; and animal waste management.

The SBIR grant program is divided into two phases. Phase I grants support technical feasibility studies. Phase II grants provide financial assistance for Phase I projects to enter the development stage to the point of commercialization. Businesses are encouraged to pursue Phase III — commercialization — through other sources, as SBIR does not provide funding for expansion, marketing, and application of the developed technology.

The U.S. Small Business Administration's Office of Innovation, Research, and Technology (phone (202) 205-6450; Internet: www.sba.gov/sbir) oversees the SBIR program across the federal government. Other federal departments that have SBIR programs include the Department of Commerce ((301) 713-3565). The Department of Defense ((703) 588-8616), the Department of Education ((202) 245-7034), the Department of Energy ((301) 903-1414), the Department of HHS (MH) ((301) 435-2688), the Department of Transportation ((617) 494-2712), the Environmental Protection Agency ((202) 343-9703), NASA ((301) 286-8888), and the National Science Foundation ((703) 292-7059.)

Project Examples
Phase I

Fresh peeled chestnuts: In Carrollton, OH, the Empire Chestnut Company was awarded a $50,000 grant to study a simple impact peeling process that will produce a value-added chestnut product—fresh peeled chestnuts. The present market volume of chestnuts is rather small and dominated by imported, in-shell chestnuts, which often reach the consumer in poor condition and are tedious to peel by hand. The objectives of the study were to improve chestnut preconditioning and the peeling device for maximum peeling with minimal kernel damage, and to develop handling methods to obtain at least a 2-week shelf life.
Snowmobile trail grooming: Somero Enterprises, Inc., a small company in Houghton, MI, developed the idea of "Fostering Rural Economic Development Using New Concepts in Snowmobile Trail Grooming." The feasibility study of the same title was awarded a $50,000 grant for an 18-month study. As recreation and tourism have become a major part of the economic stability in rural areas over the past decade, more and more businesses have looked into different kinds of trail grooming. Snowmobiling has become a major winter pastime with considerable income for local hotels, restaurants, markets and other establishments. A trail groomer that would enhance the physical properties of individual snow crystals, increase durability of the trail, decrease setup time, and lengthen the snowmobiling season.
Advanced ceramics using rice husks: Under the Industrial Applications heading, the SBIR program awarded $50,000 to Nanomaterials Research Corporation in Tucson, AZ. The proposal was for developing a process to produce advanced ceramics cost effectively using agricultural raw products, such as rice husks. Potential commercial applications of advanced ceramics include: structural, mechanical, electrical, optical, catalytic, magnetic, sensor, etc. The company during Phase I will demonstrate the proof-of-concept.

Phase II

Cane-based syrup for small-scale limited resource farmers: In Boligee, AL, Hall's Homemade Syrup was awarded an SBIR grant for $190,000 over a 24-month period to develop syrup production. A major problem for rural communities in Alabama is finding a high-value crop and associated products that can be processed by the small, limited-resource farmers in the region. This research proposed refining the production of cane-based syrup and developing value-added products from the ribbon cane.
Grass forage cropping: The G&G Hay and Black Ram Engineering companies of Princeton, ID, developed a research project to look into forage-based agriculture on the sloping, highly erodible terrain in northern Idaho. Phase I research showed that central Idaho can produce grass forage products that are competitive in regional and export markets. Commercial grass forage cropping has the potential to serve as an economic engine in a manner similar to other grass forage areas in central Washington, the Columbia River Basin, and west central Oregon. These areas have developed vibrant economies using commercial grass forage cropping as an alternative agricultural enterprise.

Information Available
The program solicitation, proposal preparation instructions, evaluation criteria, considerations, information sources, research topic descriptions, technical abstracts, and information on upcoming national conferences are available on SBIR's website.

Application and Financial Information
Phase I grants are for 6 months and will not exceed $80,000. Phase II grants are for 24 months and do not exceed $300,000. Permission for extended studies may be granted.

Applications in the form of program solicitations are generally available and open in early June and close in early September. Pre-applications and proposals are not accepted, but advice may be sought from the national program office.

Eligibility, Uses and Restrictions
To be eligible for Phase I or Phase II grants, the principal investigator's employer must be a small business as defined under Section 2.2 of the Program Solicitation. Briefly, though, a small business must be independently owned, with at least 51 percent owned or for purposes of publicly owned businesses, 51 percent of its voting stock must be owned by United States citizens or lawfully admitted permanent resident aliens.

The business, which can be a small farm, cannot have more than 500 employees (full time, part-time, temporary, or other.) Recipients of SBIR Phase I grants are the only eligible contenders for an SBIR Phase II grant. Phase I grantees can apply for Phase II applications, but must have been awarded the grant within two years of applying for a Phase II grant.

For both Phase I and Phase II, the grantee must be considered a small business at the time of the grant award.

Contact
Application materials, known as the Program Solicitation, and further information are available on SBIR's website or by contacting the national program office.

Dr. Charles Cleland, National Program Leader
National Program Office
Phone: (202) 401-4002
E-mail: ccleland@csrees.usda.gov

Dr. William Goldner, National Program Leader
Phone: (202) 401-1719; Fax: (202) 401-6070
E-mail: wgoldner@csrees.usda.gov

Cooperative State Research, Education, and Extension Service
USDA, Ag. Box 2243
Washington, DC 20250-2243

Internet
www.csrees.usda.gov/funding/sbir/sbir.html

Last Updated January 24, 2005