S T A T E   O F   N E W   Y O R K
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                                  4434

                       2009-2010 Regular Sessions

                            I N  S E N A T E

                             April 23, 2009
                               ___________

Introduced  by  Sen.  STACHOWSKI  -- read twice and ordered printed, and
  when printed to be committed to the Committee  on  Commerce,  Economic
  Development and Small Business

AN  ACT  to amend the public authorities law, in relation to recodifica-
  tion of the small business innovation research program and the  awards
  made  thereunder  within  the  New  York state foundation for science,
  technology and innovation; and to repeal section 3102-c  of  such  law
  relating to the small business innovation research program

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Legislative intent. The  state  small  business  innovation
research  (SBIR)  program,  which began in 1984, was designed to provide
assistance to New York's newer high technology companies,  helping  them
compete  for a greater share of the federal research contracts under the
federal SBIR program. The state program was highly successful,  increas-
ing  the amount of federal SBIR dollars coming into the state from under
five million dollars annually to over thirty million dollars by 1991. As
importantly, state assistance under this program greatly  increased  the
ability of federal SBIR Phase I award winners to compete for much larger
SBIR Phase II awards. Although the state SBIR statute remains in effect,
the state stopped funding the program after its initial success, in part
because  of  disagreement  over  how to allocate limited funds among the
rapidly increasing number of federal SBIR award  winners.  Consequently,
the number of state winners dramatically decreased.  This act recodifies
the small business innovation research program within the public author-
ities  law  under the auspices of the foundation for science, technology
and innovation, and clarifies how funds will be allocated  so  that  the
program  can  begin  anew  to  assist small high technology companies to
compete for federal SBIR funds, which will help them  grow  and  provide
new jobs for New York citizens.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD06825-01-9

              

S. 4434                             2

  S  2.  The  public  authorities law is amended by adding a new section
3154-a to read as follows:
  S  3154-A.  SMALL  BUSINESS INNOVATION RESEARCH PROGRAM. 1. AS USED IN
THIS SECTION, THE FOLLOWING TERMS HAVE THE FOLLOWING MEANINGS:
  (A) "SMALL BUSINESS INNOVATION RESEARCH PROGRAM" OR "SBIR" MEANS  THAT
PROGRAM,  ENACTED  PURSUANT TO THE SMALL BUSINESS INNOVATION DEVELOPMENT
ACT OF 1982 (P.L. 97-219), WHICH PROVIDES FUNDS TO SMALL  BUSINESSES  TO
CONDUCT INNOVATIVE RESEARCH HAVING COMMERCIAL APPLICATION.
  (B) "SMALL BUSINESS" MEANS A CORPORATION, PARTNERSHIP, LIMITED LIABIL-
ITY  COMPANY,  SOLE  PROPRIETORSHIP, OR INDIVIDUAL, OPERATING A BUSINESS
FOR PROFIT, WITH TWO HUNDRED FIFTY EMPLOYEES OR FEWER, INCLUDING EMPLOY-
EES EMPLOYED IN ANY SUBSIDIARY OR AFFILIATED CORPORATION OR OTHER  ENTI-
TY, WHICH OTHERWISE MEETS THE REQUIREMENTS OF THE FEDERAL SMALL BUSINESS
INNOVATION RESEARCH PROGRAM.
  2.  (A)  WITHIN  THIRTY  DAYS  OF THE PUBLIC ANNOUNCEMENT OF THE SMALL
BUSINESS INNOVATION RESEARCH PROGRAM PHASE I AWARD WINNERS BY THE APPRO-
PRIATE FEDERAL AGENCY, THE FOUNDATION SHALL CONTACT ALL  PHASE  I  AWARD
RECIPIENTS  WHOSE  PRINCIPAL PLACE OF BUSINESS IS LOCATED IN THIS STATE,
PROVIDE THEM WITH INFORMATION CONCERNING THE PROGRAM AUTHORIZED PURSUANT
TO THIS SECTION, AND ADVISE THEM OF THE REQUIREMENTS  RELATING  THERETO.
ANY  SUCH RECIPIENT, AT LEAST THIRTY DAYS PRIOR TO THE COMPLETION OF ITS
SBIR PHASE I GRANT PERIOD, MAY, AT ITS DISCRETION, SUBMIT TO THE FOUNDA-
TION A NOTICE OF ITS DESIRE TO SECURE RESEARCH FUNDING PURSUANT  TO  THE
PROVISIONS  OF  THIS  SECTION, ALONG WITH A COPY OF ITS ORIGINAL FEDERAL
SBIR PROPOSAL AND SUCH ADDITIONAL  INFORMATION  AS  THE  FOUNDATION  MAY
REQUIRE  TO  ASSIST  IT IN DETERMINING THE ELIGIBILITY OF SUCH RECIPIENT
FOR THIS PROGRAM.
  (B) IN ADDITION TO RECEIPT OF AN SBIR AWARD, ANY SMALL BUSINESS  SHALL
MEET THE FOLLOWING CRITERIA:
  I.  SUCH SMALL BUSINESS'S PRINCIPAL PLACE OF BUSINESS SHALL BE LOCATED
IN THIS STATE;
  II. SUCH  SMALL  BUSINESS  SHALL  CERTIFY  THAT  THE  RESEARCH  TO  BE
CONDUCTED WILL BE PERFORMED SOLELY IN THIS STATE;
  III. NO MONEYS SHALL BE EXPENDED FOR TRAVEL, EQUIPMENT, OR FACILITIES;
AND
  IV.  NOT  MORE  THAN  ONE-THIRD OF ANY MONEYS AWARDED TO A FIRM BY THE
FOUNDATION MAY BE  USED  TO  CONTRACT  FOR  RESEARCH  OR  OTHER  RELATED
SERVICES.
  (C) UPON A FINDING BY THE FOUNDATION THAT: (I) A PHASE I AWARD RECIPI-
ENT  WHOSE PRINCIPAL PLACE OF BUSINESS IS IN NEW YORK HAS SATISFACTORILY
MET ALL THE REQUIREMENTS OF THIS SECTION AND ANY ADDITIONAL REQUIREMENTS
THE FOUNDATION MAY DEEM NECESSARY;  PROVIDED,  HOWEVER,  THAT  ANY  SUCH
ADDITIONAL REQUIREMENTS SHALL NOT ARBITRARILY EXCLUDE A PARTICULAR GROUP
OR  GROUPS OF TECHNOLOGIES OR COMPANIES; AND (II) THE RESEARCH CONDUCTED
MAY RESULT IN THE DEVELOPMENT OF INNOVATIVE TECHNOLOGY HAVING THE POTEN-
TIAL TO LEAD TO COMMERCIALIZATION OR FABRICATION WITHIN NEW YORK OF  NEW
OR IMPROVED PRODUCTS, PROCESSES, OR SERVICES, THE FOUNDATION SHALL NOTI-
FY  SUCH SMALL BUSINESS THAT IT WILL AWARD THE FIRM A RESEARCH CONTRACT.
SUCH CONTRACT SHALL  BE  COMPATIBLE  WITH  AND  A  CONTINUATION  OF  THE
RESEARCH  TO BE PERFORMED UNDER THE SBIR CONTRACT AWARDED BY THE FEDERAL
AGENCY INVOLVED AND SHALL BE CALCULATED AS FOLLOWS: (I)  THE  AMOUNT  OF
EACH  CONTRACT SHALL EQUAL THE AMOUNT OF THE FEDERAL SBIR AWARD OR FIFTY
THOUSAND DOLLARS, WHICHEVER IS LESS; PROVIDED, HOWEVER, THAT  THE  TOTAL
AMOUNT  OF  ALL  SUCH CONTRACTS SHALL NOT EXCEED THE AMOUNT APPROPRIATED
FOR THIS PURPOSE, OR (II) IN THE EVENT THAT THE TOTAL, POSSIBLE, MAXIMUM
AMOUNT OF ALL CONTRACTS, SUCH TOTAL, POSSIBLE, MAXIMUM AMOUNT CALCULATED

S. 4434                             3

ON THE BASIS OF MATCHING EACH FEDERAL SBIR AWARD IN AN AMOUNT  EQUAL  TO
THE  AMOUNT OF SUCH AWARD, OR FIFTY THOUSAND DOLLARS, WHICHEVER IS LESS,
EXCEEDS THE TOTAL AMOUNT APPROPRIATED FOR THIS PURPOSE,  THE  AMOUNT  OF
EACH  CONTRACT SHALL BE REDUCED BY A RATIO EQUAL TO THE AMOUNT APPROPRI-
ATED FOR THIS PURPOSE DIVIDED BY THE TOTAL, POSSIBLE, MAXIMUM AMOUNT  OF
ALL CONTRACTS TO BE AWARDED.
  (D) THE FOUNDATION SHALL ESTABLISH RULES AND REGULATIONS FOR THE SMALL
BUSINESS  INNOVATION  RESEARCH PROGRAM, INCLUDING AWARD SELECTION CRITE-
RIA, WHICH SHALL SERVE  AS  THE  BASIS  FOR  AWARDS  FUNDED  UNDER  THIS
PROGRAM.
  3.  THE  FOUNDATION  SHALL NOT DISBURSE ANY MONEYS TO A SMALL BUSINESS
UNTIL:
  (A) SUCH SMALL BUSINESS HAS COMPLETED ITS SBIR PHASE I RESEARCH;
  (B) ITS FINAL PHASE I REPORT WITH RESPECT THERETO HAS BEEN ACCEPTED BY
THE FEDERAL AGENCY INVOLVED;
  (C) ITS PHASE II RESEARCH PROPOSAL HAS BEEN PROPERLY SUBMITTED TO  THE
FEDERAL AGENCY INVOLVED; AND
  (D)  IT HAS SUBMITTED COPIES OF ITS FINAL PHASE I REPORT AND ITS PHASE
II PROPOSAL TO THE FOUNDATION.
  4. CONSISTENT WITH FEDERAL SBIR PROCEDURES, THE FOUNDATION  SHALL  NOT
DISCLOSE  PROPRIETARY INFORMATION WHEN REQUESTED NOT TO DO SO BY PARTIC-
IPANTS IN THIS PROGRAM.
  5. THE FOUNDATION SHALL ANNUALLY SUBMIT A REPORT TO THE GOVERNOR,  THE
TEMPORARY  PRESIDENT  OF  THE  SENATE,  AND  THE SPEAKER OF THE ASSEMBLY
DETAILING THE RESULTS OF THE PROGRAM, INCLUDING BUT NOT LIMITED  TO  THE
NUMBER OF NEW YORK SMALL BUSINESSES APPLYING FOR SBIR AWARDS, THE NUMBER
RECEIVING  PHASE  I  AWARDS,  THE  NUMBER RECEIVING PHASE II AWARDS, ANY
PRODUCTS OR PROCESSES  DEVELOPED  AS  A  RESULT  OF  THE  SBIR  RESEARCH
INVOLVED,  ANY PATENTS APPLIED FOR OR LICENSES GRANTED BASED ON THE SBIR
RESEARCH INVOLVED, AN ABSTRACT OF THE SBIR PHASE I AND II WORK PERFORMED
BY NEW YORK FIRMS, AND ANY OTHER INFORMATION PERTINENT IN EVALUATING THE
PROGRAM.
  6. THE FOUNDATION SHALL CONDUCT A PROGRAM TO INFORM  SMALL  BUSINESSES
OF  THE FEDERAL SBIR PROGRAM AND THIS NEW YORK STATE PROGRAM IN ORDER TO
ENSURE THAT ALL FIRMS HAVE  THE  OPPORTUNITY  TO  PARTICIPATE  IN  THESE
PROGRAMS.
  7.  THE  FOUNDATION  SHALL FACILITATE AND PROMOTE THE ESTABLISHMENT OF
JOINT SMALL BUSINESS-UNIVERSITY TECHNOLOGY COUNCILS AT THE  CENTERS  FOR
ADVANCED  TECHNOLOGY  AND  OTHER  UNIVERSITIES  WITHIN THE STATE WHEREBY
SMALL FIRMS AND UNIVERSITY EXPERTS CAN FACILITATE THE TRANSFER OF  TECH-
NOLOGY  AND  WORK  TOGETHER  ON  RESEARCH  PROJECTS  RELATED TO THE SBIR
PROGRAM OR OTHER RESEARCH PROJECTS OF MUTUAL INTEREST.
  8. THE PROVISIONS OF THIS SECTION SHALL BE EFFECTIVE IF, AND  AS  LONG
AS,  FEDERAL  FINANCIAL  PARTICIPATION IS AVAILABLE THEREFOR PURSUANT TO
THE SMALL BUSINESS INNOVATION DEVELOPMENT ACT OF 1982.
  S 3. Section 3102-c of the public authorities law is REPEALED.
  S 4. For the  purposes  of  the  small  business  innovation  research
program, the New York state foundation for science, technology and inno-
vation  shall be deemed a continuation of the New York state science and
technology foundation, repealed pursuant to chapter 624 of the  laws  of
1999.  Any and all contracts entered into between any small business and
such foundation in effect upon the effective  date  of  this  act  shall
remain  in  effect  pursuant to the terms of such contracts and shall be
binding upon such foundation.
  S 5. This act shall take effect immediately.