GAO Reaffirms Agencies’ Discretion to Award Sole-Source SBIR Phase III Contracts (Even to a Successor-in-Interest)

The Small Business Innovation Research program (SBIR) is a successful initiative that increases the participation of small business concerns in federally funded research and development. Awards under Phases I and II of the program are limited to small businesses. Of relevance to this article, federal agencies may award non-competed SBIR Phase III contracts to recipients of prior SBIR awards (and their legal successors-in-interest of any size), as long as any new award somehow “derives from, extends, or completes efforts made under prior funding agreements under the SBIR program.” 15 U.S.C. § 638(e)(4)(C). Phase III awards are not restricted to small businesses. 

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