Policies & Compliance

Funding Sources & Opportunities

4.4 Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR)

Several federal agencies offer funding to small businesses to support research and development with the goal of commercializing new technologies. This funding is provided through two related but distinct programs:

Small Business Innovation Research (“SBIR”)
Small Business Technology Transfer (“STTR”)

Both programs are funding directly to a small business concern (SBC) - a for-profit, U.S.-owned small business that serves as the applicant and prime award recipient.

Role of the University as a Research Institution (RI)

The University qualifies as a Research Institution (RI) for purposes of both SBIR and STTR projects.

The University's participation occurs when:

it is included as a collaborator in the proposal; and
the federal sponsor approves the arrangement; and
the University receives funding via a subcontract/subaward from the SBC.

When collaboration occurs, there are two distinct Principal Investigators (PIs):

an SBC PI (representing the small business); and
an RI PI (representing the University).

Key Distinctions Between SBIR and STTR

Although similar in purpose, SBIR and STTR differ in structure, eligibility, and collaboration requirements.

**Requirements for SBIR**
Applicability	Eligibility Requirements
SBC	Must be an American-owned business Must be independently operated Must be a for-profit business Must have five hundred or fewer employees If sub-contract with another party, or with multiple parties: SBC must do at least two-thirds of research during Phase I; SBC must do at least one-half of research during Phase II
SBC PI	Must be primarily employed with SBC University of Utah faculty are not eligible to be lead PI on a SBIR
RI	Involvement of RI is allowed but not required If the SBC subcontracts with RI, RI may conduct up to one-third of research during Phase 1; RI may do up to one-half of research during Phase II
Term	Phase I: up to 6 months Phase II: up to 2 years

**Requirements for STTR**
Applicability	Eligibility Requirements
SBC	Must be an American-owned business Must be independently operated Must be a for-profit business Must have 500 or fewer employees Not less than 40% of the research/research development must be performed by SBC
SBC PI	Must be primarily employed by either the SBC or the collaborating PI. University faculty or employee must have at least 10% effort on the award, which must be limited to either the U or the SBC (but not both).
RI	Research Institution collaborator required must be one of the following: A non-profit college or university; a domestic non-profit research organization; or a federally funded research and development center RI required to conduct at least 30% of research and development but may conduct up to 60%. Must be a formal collaboration.
Term	Phase I: up to 1 year Phase II: up to 2 years

SBIR/STTR Contact

University investigators anticipating participation as subrecipients should review the SBIR/STTR Implementation Procedure prior to involvement.

Questions and concerns about SBIR/STTR should be addressed to Kevin Peterson.

PI Eligibility and Roles Separation

For SBIR awards, the SBC PI must be primarily employed by the company. Because most University faculty are employed at 50% or greater by the University, they generally cannot serve as the SBC PI. Faculty may, however, serve as the RI PI under a University subaward.

For STTR awards, the PI may be primarily employed by either the University or the company, provided sponsor-specific eligibility requirements are met.

For both SBIR and STTR:

The SBC PI and RI PI must be different individuals
Maintaining clear separation of roles, effort, and responsibility between the company and the University is essential for compliance.

Sponsor-specific rules may impose additional restrictions. For example, NSF prohibits individuals who hold equity or leadership in the SBC from being paid through a University subward or as consultants, unless specifically approved.

Faculty Affiliated Companies and Consulting

University policy allows faculty to consult for external companies. However, to avoid conflicts of interest and commitment:

Faculty should generally act either as a consultant to the SBC or as an investigator under a University subaward - not both.
When a faculty-affiliated company sponsors SBIR/STTR research at the University, the faculty member should not receive consulting compensation from the award.

Faculty with ownership or financial interests in an SBC must carefully review all sponsor requirements and obtain any required approvals

Participation of Students and Trainees

Students and trainees - including undergraduates, graduate students, postdoctoral fellows, and research staff - may participate in SBIR/STTR projects.

University investigators must:

inform trainees that SBIR/STTR projects are designed for commercialization;
help trainees avoid conflicts between academic and commercial interests; and
ensure participation is voluntary, unless previously agreed upon in writing.

Trainees and employees participating in SBIR/STTR activities must submit required financial disclosures and comply with University conflict of interest (COI) oversight.

Trainees supported by fellowship or training grants should confirm sponsor permission before participating.

Use of University Resources and Space

SBIR/STTR applications certify that company research will be conducted in SBC facilities by SBC personnel, unless otherwise approved by the sponsor.

Use of University space or resources for the SBC's portion of work must be:

explicitly disclosed;
approved by the sponsor; and
addressed in a written collaboration agreement.

Improper use of University resources may raise conflicts of interest, especially regarding intellectual property ownership.

Administration and Compliance

The SBC is solely responsible for grant management and compliance for SBIR/STTR awards. SBC's are strongly encouraged to engage legal and accounting professionals experienced in SBIR/STTR administration.

Resources

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Office of Sponsored Projects

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Requirements for SBIR

Requirements for STTR