Congress is set to consider an increase to SBIR funding, according to a recent report by Mass High Tech: The Journal of New England Technology.

Sen. Evan Bayh, D-Ind., introduced the legislation, which would increase from 2.5 to 5% by 2013 the amount that federal agencies with large research and development budgets would have to set aside for SBIR funding.

Mass High Tech: The Journal of New England Technology reported on the significance of the SBIR program as follows:

The SBIR program — which doled out $1.9 billion nationwide in 2005 — is a major source of federal funding for early-stage technology development in the United States. The grants are used to explore the feasibility of technologies sought by government agencies, including the U.S. Department of Energy and the U.S. Department of Defense.

Supporters of the SBIR budget increase include biotechnology executives who argue that the funding fills the gap left by declining venture capital investment in the early-stage firms.

Of course, the article points out that the debate on the legislation will likely focus on the role of venture capital firms, since companies majority-owned by large venture-capital backed firms do not qualify for SBIR awards.

The SBIR program is currently set to expire in 2008.

f