Spurring Small Business Innovation Act

II 116TH CONGRESS 1ST SESSION S. 2150 To establish a regional high-growth collaborative pilot program in the Small Business Administration, and for other purposes. IN THE SENATE OF THE UNITED STATES JULY 17, 2019 Mr. KENNEDY introduced the following bill; which was read twice and referred to the Committee on Small Business and Entrepreneurship A BILL To establish a regional high-growth collaborative pilot pro- gram in the Small Business Administration, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Spurring Small Busi- 4 ness Innovation Act’’. 5 SEC. 2. REGIONAL HIGH-GROWTH COLLABORATIVE PILOT 6 PROGRAM. 7 (a) DEFINITIONS.—In this section— 8 (1) the term ‘‘Administration’’ means the Small 9 Business Administration; 10 VerDate Sep 11 2014 02:12 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S2150.IS S2150 kjohnson on DSK79L0C42 with BILLS 2 •S 2150 IS (2) the term ‘‘Administrator’’ means the Ad- 1 ministrator of the Administration; 2 (3) the term ‘‘covered period’’ means the 5-fis- 3 cal year period beginning in the first fiscal year that 4 begins after the date of enactment of this Act; 5 (4) the term ‘‘eligible entity’’ includes— 6 (A) a nonprofit organization; 7 (B) a public or nonprofit private institu- 8 tion of higher education; 9 (C) a State government or any agency of 10 a State government; 11 (D) a regional entity, as described in sec- 12 tion 21(a)(1) of the Small Business Act (15 13 U.S.C. 648(a)(1)); 14 (E) a State-chartered development, credit, 15 or finance corporation; 16 (F) a small business development center; 17 (G) a women’s business center; 18 (H) a veteran business outreach center; 19 (I) a small business growth accelerator; 20 (J) a small business incubator; and 21 (K) a combination of entities described in 22 subparagraphs (A) through (J); 23 VerDate Sep 11 2014 02:12 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S2150.IS S2150 kjohnson on DSK79L0C42 with BILLS 3 •S 2150 IS (5) the term ‘‘institution of higher education’’ 1 has the meaning given the term in section 101 of the 2 Higher Education Act of 1965 (20 U.S.C. 1001); 3 (6) the term ‘‘Office’’ means the Office of Inno- 4 vation and Technology of the Administration; 5 (7) the term ‘‘pilot program’’ means the Re- 6 gional High-Growth Collaborative Pilot Program es- 7 tablished under subsection (b); 8 (8) the term ‘‘small business concern’’ has the 9 meaning given the term in section 3(a) of the Small 10 Business Act (15 U.S.C. 632(a)); 11 (9) the term ‘‘small business development cen- 12 ter’’ has the meaning given the term in section 3(t) 13 of the Small Business Act (15 U.S.C. 632(t)); 14 (10) the terms ‘‘Small Business Innovation Re- 15 search Program’’ and ‘‘Small Business Technology 16 Transfer Program’’ have the meanings given the 17 terms in section 9(e) of the Small Business Act (15 18 U.S.C. 638(e)); and 19 (11) the term ‘‘women’s business center’’ means 20 a women’s business center operating pursuant to 21 section 29 of the Small Business Act (15 U.S.C. 22 656). 23 (b) ESTABLISHMENT OF PILOT PROGRAM.—There is 24 established in the Administration, for the covered period, 25 VerDate Sep 11 2014 02:12 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S2150.IS S2150 kjohnson on DSK79L0C42 with BILLS 4 •S 2150 IS a Regional High-Growth Collaborative Pilot Program, the 1 purpose of which is to provide the specialized resources 2 that are necessary in order to start and scale small busi- 3 ness concerns in high-growth industries. 4 (c) PHASES OF PILOT PROGRAM.— 5 (1) PHASE I.— 6 (A) IN GENERAL.—The Office shall— 7 (i) carry out a competition to estab- 8 lish a total of 10 entities that shall serve 9 as regional high-growth collaboratives dur- 10 ing the first 2 fiscal years of the covered 11 period; and 12 (ii) in carrying out the competition re- 13 quired under clause (i), ensure that there 14 is established 1 regional high-growth col- 15 laborative in each of the 10 regions of the 16 Administration, as in existence on the day 17 before the date of enactment of this Act. 18 (B) DUTIES.—Each collaborative estab- 19 lished under subparagraph (A) shall, during the 20 2-fiscal year period described in subparagraph 21 (A)(i), establish connections between small busi- 22 ness concerns in industries relating to tech- 23 nology and other entities in order to— 24 VerDate Sep 11 2014 02:12 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S2150.IS S2150 kjohnson on DSK79L0C42 with BILLS 5 •S 2150 IS (i) offer to those small business con- 1 cerns— 2 (I) access to appropriate tech- 3 nical and managerial resources; and 4 (II) connections to the programs 5 overseen by the Office of Entrepre- 6 neurial Development of the Adminis- 7 tration; 8 (ii) provide to those small business 9 concerns— 10 (I) market research relating to 11 potential customers for the products 12 and services offered by the small busi- 13 ness concerns; and 14 (II) other types of business train- 15 ing relating to technology and innova- 16 tion; 17 (iii) facilitate access to capital for 18 those small business concerns; 19 (iv) refer those small business con- 20 cerns to other assistance programs, as ap- 21 propriate; and 22 (v) provide those small business con- 23 cerns with assistance in preparing applica- 24 tions with respect to the Small Business 25 VerDate Sep 11 2014 02:12 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S2150.IS S2150 kjohnson on DSK79L0C42 with BILLS 6 •S 2150 IS Innovation Research Program and other 1 similar programs. 2 (C) EVALUATIONS.— 3 (i) IN GENERAL.—The Office shall 4 evaluate the success of each collaborative 5 established under subparagraph (A) by 6 analyzing, for the 2-fiscal year period de- 7 scribed in subparagraph (A)(i)— 8 (I) the number of small business 9 concerns assisted by the collaborative; 10 (II) the number of small business 11 concerns assisted by the collaborative 12 that submitted proposals under the 13 Small Business Innovation Research 14 Program, the Small Business Tech- 15 nology Transfer Program, and other 16 similar programs; 17 (III) the rates of hiring by small 18 business concerns assisted by the col- 19 laborative; 20 (IV) the amount of capital pro- 21 vided to small business concerns as- 22 sisted by the collaborative; 23 VerDate Sep 11 2014 02:12 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S2150.IS S2150 kjohnson on DSK79L0C42 with BILLS 7 •S 2150 IS (V) the percentage of small busi- 1 ness concerns assisted by the collabo- 2 rative that operate in rural areas; 3 (VI) the degree to which the 4 services provided by the collaborative 5 are geographically dispersed; 6 (VII) the number of small busi- 7 ness concerns created as a result of 8 the activities carried out by the col- 9 laborative; and 10 (VIII) any additional metric that 11 the Office determines to be appro- 12 priate. 13 (ii) FACTOR WEIGHTING.—The Office 14 shall— 15 (I) in performing evaluations 16 under clause (i), determine how much 17 weight should be given to each metric 18 described in subclauses (I) through 19 (VIII) of that clause; and 20 (II) make the determination of 21 the Office under subclause (I) publicly 22 available. 23 (D) AWARD OF FUNDS THROUGH COOPER- 24 ATIVE AGREEMENT.— 25 VerDate Sep 11 2014 02:12 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S2150.IS S2150 kjohnson on DSK79L0C42 with BILLS 8 •S 2150 IS (i) IN GENERAL.—The Administrator 1 shall enter into a cooperative agreement 2 with each collaborative established under 3 subparagraph (A), under which the Admin- 4 istrator shall award to the collaborative 5 $300,000— 6 (I) for each fiscal year in which 7 the collaborative carries out the duties 8 described in subparagraph (B); and 9 (II) to carry out the duties de- 10 scribed in subparagraph (B). 11 (ii) ADMINISTRATOR DISCRETION.— 12 With respect to an award under clause (i), 13 the Administrator may distribute the 14 award as determined appropriate by the 15 Administrator, including by distributing 16 the award in installments. 17 (E) RELATIONSHIP TO PHASE II.— 18 (i) HIGHEST SCORING COLLABO- 19 RATIVE.—The collaborative that scores the 20 highest with respect to the evaluations per- 21 formed under subparagraph (C) (referred 22 to in this subparagraph as the ‘‘highest 23 scoring collaborative’’) shall— 24 VerDate Sep 11 2014 02:12 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S2150.IS S2150 kjohnson on DSK79L0C42 with BILLS 9 •S 2150 IS (I) subject to clause (ii), serve as 1 the model with respect to how to 2 structure the high-growth collabora- 3 tives established under phase II of the 4 pilot program under paragraph (2); 5 and 6 (II) be guaranteed to receive an 7 award under paragraph (2) for the 8 first fiscal year in which phase II of 9 the pilot program is in effect under 10 that paragraph. 11 (ii) OTHER COLLABORATIVES.—The 12 Administrator— 13 (I) may incorporate elements 14 from collaboratives other than the 15 highest scoring collaborative when de- 16 termining how to structure the high- 17 growth collaboratives established 18 under phase II of the pilot program 19 under paragraph (2); and 20 (II) if the Administrator makes 21 an incorporation described in sub- 22 clause (I), shall make the methodology 23 regarding that incorporation publicly 24 available. 25 VerDate Sep 11 2014 02:12 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S2150.IS S2150 kjohnson on DSK79L0C42 with BILLS 10 •S 2150 IS (2) PHASE II.— 1 (A) IN GENERAL.—The Office shall enter 2 into a total of 10 cooperative agreements, under 3 which the Office shall make awards to eligible 4 entities to establish, for the third, fourth, and 5 fifth fiscal years of the covered period, 1 re- 6 gional high-growth collaborative in each of the 7 10 regions of the Administration, as in exist- 8 ence on the day before the date of enactment of 9 this Act. 10 (B) APPLICATION.—An eligible entity that 11 wishes to enter into a cooperative agreement 12 under subparagraph (A) shall submit to the Of- 13 fice an application— 14 (i) in such form and manner as the 15 Office may require; and 16 (ii) that contains— 17 (I) a plan describing— 18 (aa) how the eligible entity 19 will provide the services described 20 in clauses (i) through (v) of para- 21 graph (1)(B) (referred to in this 22 subparagraph as ‘‘covered serv- 23 ices’’); 24 VerDate Sep 11 2014 02:12 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S2150.IS S2150 kjohnson on DSK79L0C42 with BILLS 11 •S 2150 IS (bb) the means by which the 1 eligible entity will provide covered 2 services; 3 (cc) the partnerships into 4 which the eligible entity will enter 5 in order to provide covered serv- 6 ices; 7 (dd) how the eligible entity 8 will encourage participation by 9 small business concerns that op- 10 erate in rural areas; 11 (ee) the method used by the 12 eligible entity to tailor covered 13 services to account for the var- 14 ious geographic areas and eco- 15 nomic conditions in the region in 16 which the eligible entity will serve 17 as a collaborative; and 18 (ff) the geographic area that 19 the eligible entity will serve; 20 (II) a budget for the provision of 21 covered services by the eligible entity; 22 (III) the name of the individual 23 who will serve as executive director of 24 VerDate Sep 11 2014 02:12 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S2150.IS S2150 kjohnson on DSK79L0C42 with BILLS 12 •S 2150 IS the collaborative or a plan to appoint 1 such an individual; and 2 (IV) any other information that 3 the Office determines to be necessary. 4 (C) AMOUNT OF AWARD.— 5 (i) IN GENERAL.—Each award to an 6 eligible entity under this paragraph shall 7 be— 8 (I) in an amount that is 9 $500,000; and 10 (II) obligated during the fiscal 11 year in which the eligible entity re- 12 ceives the award. 13 (ii) MATCHING FUNDS.—An eligible 14 entity to which the Office makes an award 15 under clause (i) shall be required to match 16 50 percent of that award, which may be 17 satisfied through the use of an in-kind 18 match. 19 (D) EVALUATIONS.—The Office shall, with 20 respect to each award made under this para- 21 graph, evaluate the eligible entity to which the 22 award is made using the same metrics used 23 under paragraph (1)(C). 24 VerDate Sep 11 2014 02:12 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\S2150.IS S2150 kjohnson on DSK79L0C42 with BILLS 13 •S 2150 IS (E) RENEWAL.—The Office may, for each 1 of the fourth and fifth fiscal years of the cov- 2 ered period, renew an award made to an eligible 3 entity under this paragraph in the third or 4 fourth fiscal year of the covered period, as ap- 5 plicable, if, with respect to that third or fourth 6 fiscal year, the eligible entity scores highly on 7 the evaluation conducted under subparagraph 8 (D) with respect to the eligible entity. 9 (d) ADMINISTRATOR RESPONSIBILITIES.—The Ad- 10 ministrator shall— 11 (1) provide oversight of the Office with respect 12 to the carrying out of the pilot program; and 13 (2) ensure that— 14 (A) the pilot program is consistent with 15 statutory requirements, including the require- 16 ments of this Act; and 17 (B) the district and regional offices of the 18 Administration work closely to ensure the suc- 19 cess of the pilot program. 20 (e) REPORTS.— 21 (1) SBA.—For each fiscal year in which the 22 pilot program is in effect, the Administrator shall 23 submit to Congress a report that contains, with re- 24 spect to the year covered by the report— 25 VerDate Sep 11 2014 02:12 Jul 23, 2019 Jkt 089200 PO 00000 Frm 00013 Fmt 6652 Sfmt 6201 E:\BILLS\S2150.IS S2150 kjohnson on DSK79L0C42 with BILLS 14 •S 2150 IS (A) the information collected by the Office 1 in order to carry out the evaluations required 2 under paragraphs (1)(C) and (2)(D) of sub- 3 section (c); 4 (B) a description of the services provided 5 by collaboratives under the pilot program; 6 (C) a list of— 7 (i) with respect to phase I of the pilot 8 program under subsection (c)(1), each en- 9 tity established as a collaborative under 10 such subsection (c)(1); and 11 (ii) with respect to phase II of the 12 pilot program under subsection (c)(2), each 13 eligible entity with which the Office en- 14 tered into a cooperative agreement under 15 such subsection (c)(2); and 16 (D) with respect to phase II of the pilot 17 program under subsection (c)(2), an analysis of 18 h [Text truncated for display. 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