[Federal Register Volume 62, Number 47 (Tuesday, March 11, 1997)]
[Proposed Rules]
[Pages 11256-11263]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-5914]
[[Page 11255]]
_______________________________________________________________________
Part II
Department of Agriculture
_______________________________________________________________________
Cooperative State Research, Education, and Extension Service
_______________________________________________________________________
7 CFR Part 3403
Small Business Innovation Research Grants Program; Administrative
Provisions; Proposed Rule
Federal Register / Vol. 62, No. 47 / Tuesday, March 11, 1997 /
Proposed Rules
[[Page 11256]]
DEPARTMENT OF AGRICULTURE
Cooperative State Research, Education, and Extension Service
7 CFR Part 3403
Small Business Innovation Research Grants Program; Administrative
Provisions
AGENCY: Cooperative State Research, Education, and Extension Service,
USDA.
ACTION: Notice of proposed rulemaking.
-----------------------------------------------------------------------
SUMMARY: The Cooperative State Research, Education, and Extension
Service (CSREES) proposes to amend its regulations relating to the
administration of the Small Business Innovation Research (SBIR) Grants
Program, which prescribe the procedures to be followed annually in the
solicitation of research grant proposals, the evaluation of such
proposals, and the award of competitive research grants under this
program. This rule amends those regulations by identifying information
that will be specified in the annual solicitation as opposed to this
rule. CSREES is republishing these regulations in their entirety with
the proposed amendments in order to enhance their use by the public and
to ensure expeditious submission and processing of grant proposals.
DATES: Written comments are invited from interested individuals and
organizations. To be considered in the formulation of a final rule, all
relevant material must be received on or before April 10, 1997.
ADDRESSES: Written comments should be sent to Sally J. Rockey, Deputy
Administrator, Competitive Research Grants and Awards Management,
Cooperative State Research, Education, and Extension Service, U.S.
Department of Agriculture, STOP 2240, 1400 Independence Avenue, SW.,
Washington, DC 20250-2240.
FOR FURTHER INFORMATION CONTACT: Sally J. Rockey at (202) 401-1766.
SUPPLEMENTARY INFORMATION:
Paperwork Reduction
Under the provisions of the Paperwork Reduction Act of 1980 (44
U.S.C. Chapter 35), the collection of information requirements
contained in this proposed rule have been approved under OMB Document
Nos. 0524-0022, 0524-0025, and 0524-0026.
Classification
This proposed rule has been reviewed under Executive Order 12866,
and it has been determined that it is not a ``significant regulatory
action'' rule because it will not have an annual effect on the economy
of $100 million or more or adversely and materially affect a sector of
the economy, productivity, competition, jobs, the environment, public
health or safety, or State, local, or tribal governments or
communities. This proposed rule will not create any serious
inconsistencies or otherwise interfere with any actions taken or
planned by another agency. It will not materially alter the budgetary
impact of entitlements, grants, user fees or loan programs and does not
raise novel legal or policy issues arising out of legal mandates, the
President's priorities, or principles set forth in Executive Order No.
12866. In addition, the Department certifies that the proposed rule
will not have a significant impact on a substantial number of small
entities as defined in the Regulatory Flexibility Act, Pub. L. 96-534
(5 U.S.C. 601 et seq.).
Regulatory Analysis
This proposed rule has been reviewed under Executive Order 12988,
Civil Justice Reform. All State and local laws and regulations that are
in conflict with this rule are preempted. No retroactive effect is to
be given to this rule. This rule does not require administrative
proceedings before parties may file suit in court.
Environmental Impact Statement
This proposed regulation does not significantly affect the
environment. Therefore, an environmental impact statement is not
required under the National Environmental Policy Act of 1969, as
amended.
Catalog of Federal Domestic Assistance
This program is listed in the Catalog of Federal Domestic
Assistance under No. 10.212, Small Business Innovation Research
(SBIR Program). For the reasons set forth in the Final Rule-related
Notice to 7 CFR part 3015, subpart V, 48 FR 29115, June 24, 1983,
and pursuant to the Notice found at 52 FR 22831, June 16, 1987, this
program is excluded from the scope of Executive Order 12372 which
requires intergovernmental consultation with State and local
officials.
Background and Purpose
On June 10, 1988, the Department published a Final Rule in the
Federal Register (53 FR 21966-21972), which established part 3403 of
title 7, subtitle B, chapter XXXIV of the Code of Federal Regulations,
for the purpose of administering the U.S. Department of Agriculture's
Small Business Innovation Research (SBIR) Grants Program conducted
under the authority of the Small Business Innovation Development Act of
1982, as amended (15 U.S.C. 638) and section 630 of the Act making
appropriations for Agriculture, Rural Development, and Related
Agencies' programs for fiscal year ending September 30, 1987, and for
other purposes, as made applicable by section 101(a) of Pub. L. 99-591,
100 Stat. 3341. This rule established and codified the procedures to be
followed in the solicitation of competitive small business innovation
research proposals, the evaluation of such proposals, and the award of
grants under this program. On September 20, 1991, the Department
published a Final Rule in the Federal Register (56 FR 47882-47889),
which amended the Cooperative State Research Service (CSRS) regulations
relating to the Small Business Innovation Research Grants Program. On
December 30, 1994, the Department published a Final Rule in the Federal
Register (59 FR 68072) which amended 7 CFR chapter XXXIV to reflect the
abolishment of CSRS and the establishment of CSREES. On May 15, 1996,
the Department published a Final Rule in the Federal Register (61 FR
25366) amending 7 CFR Chapter XXXIV by encouraging the individuals who
are principally responsible for the scientific or technical direction
of the proposed work to be designated as the principal investigator,
making it a condition that Federal funds remain for an extension of a
Phase I grant and that an extension will not normally exceed 12 months,
requiring that when purchasing equipment or products with agreement
funds that only American-made items are purchased to the extent
possible, and making a few additional changes. These regulations are
proposed to be amended as follows:
Authority: CSREES proposes to amend the authority citation from
``5 U.S.C. 638'' to ``15 U.S.C. 638'' to correct a technical error.
Section 3403.2. CSREES proposes to correct ``in behalf of'' to read
``on behalf of'' in the definition of ``awarding official.'' In
addition, CSREES proposes to revise the definition of ``funding
agreement'' to include ``concern'' after ``small business'' and the
definition of ``Socially and economically disadvantaged individual'' by
removing the ``or'' before ``Subcontinent Asian Americans'' to be in
accordance with the language of the January 1993 SBIR Policy Directive.
Section 3403.3. CSREES proposes to change references of a ``firm''
to ``organization'' in order to be consistent throughout the document.
In addition, CSREES proposes to include ``concern'' after ``small
business'' to be in
[[Page 11257]]
accordance with the language of the January 1993 SBIR Policy Directive.
Section 3403.6(d). CSREES proposes to delete the language in this
section and replace it with a statement that the information will be
identified in the annual solicitation.
Section 3403.7. CSREES proposes to add paragraph (a) and
redesignate paragraphs (a) through (m) as paragraphs (1) through (13),
paragraphs (c) (1) through (6) as subparagraphs (3) (i) through (vi),
paragraphs (g) (1) and (2) as subparagraphs (7) (i) and (ii),
paragraphs (h) (1) through (6) as subparagraphs (8) (i) through (vi),
paragraphs (k) (1) through (3) as subparagraphs (11) (i) through (iii),
and paragraphs (l) (1) and (2) as subparagraphs (12) (i) and (ii).
Furthermore, CSREES proposes to add language to identify that further
instructions or descriptions of the phase I proposal items as well as
additional items will be provided in the annual solicitation, as
necessary. As such, much of the instructions and descriptions of the
phase I items are deleted from this section.
Section 3403.7(g). CSREES proposes to add an item (iii) to require
the applicant to identify whether and by what means the proposed
research will satisfy the public interest. This will assist in
determining the potential success of potential commercial application.
Section 3403.7(j). CSREES proposes to add language to explain that
if an Institutional Review Board (IRB) review is required that USDA
must receive and accept the IRB approval before grant funds will be
released to the grantee.
Section 3403.8. CSREES proposes to add paragraph (a) and
redesignate paragraphs (a) through (h) as paragraphs (1) through (8)
and paragraphs (h) (1) and (2) as subparagraphs (8) (i) and (ii). In
addition, see proposed change described for Sec. 3403.7. The same
changes are proposed for phase II proposals as are proposed for phase I
proposals.
Section 3403.10(b). CSREES proposes to add language to explain that
the evaluation criteria will be identified in the annual solicitation.
Section 3403.11. CSREES proposes to delete this section due to the
proposed change identified for Sec. 3403.10(b).
Section 3403.12. CSREES proposes to delete paragraph (a) and add
paragraph (b) to Sec. 3403.10(e) due to the proposed change identified
for Sec. 3403.10(b).
Section 3403.13. CSREES proposes to redesignate Sec. 3403.13 as
Sec. 3403.11.
Section 3403.14. CSREES proposes to redesignate Sec. 3403.14 as
Sec. 3403.12.
Section 3403.15. CSREES proposes to redesignate Sec. 3403.15 as
Sec. 3403.13.
Section 3403.16. CSREES proposes to redesignate Sec. 3403.16 as
Sec. 3403.14. In addition, CSREES proposes to change references of
``Department'' to ``Authorized Departmental Officer'' to be more
specific.
Section 3403.16(c). CSREES proposes to change the reference to a
specific phase I dollar amount with ``the approved award amount'' since
the phase I award amount may vary from one year to the next.
Section 3403.17. CSREES proposes to redesignate Sec. 3403.17 as
Sec. 3403.15. In addition, CSREES proposes to add ``9 CFR Parts 1, 2 ,
3, and 4--USDA Laboratory Animal Care Regulations'' after the reference
to 7 CFR part 3407 and before the reference to 48 CFR part 31.
Section 3403.18. CSREES proposes to redesignate Sec. 3403.18 as
Sec. 3403.16.
CSREES proposes to republish title 7, subtitle B, chapter XXXIV,
part 3403, in its entirety with the proposed aforementioned changes.
This action will preclude making a separate amendment to these
regulations and allow the regulations to appear in one document for
easy access and reference by the public and CSREES.
List of Subjects in 7 CFR Part 3403
Grant programs--Agriculture, Grant administration. For the reasons
set out in the preamble, title 7, subtitle B, chapter XXXIV, part 3403
of the Code of Federal Regulations is revised to read as follows:
PART 3403--SMALL BUSINESS INNOVATION RESEARCH GRANTS PROGRAM
Subpart A--General Information
Sec.
3403.1 Applicability of regulations.
3403.2 Definitions.
3403.3 Eligibility requirements.
Subpart B--Program Description
3403.4 Three-phase program.
Subpart C--Preparation and Submission of Proposals
3403.5 Requests for proposals.
3403.6 General content of proposals.
3403.7 Proposal format for phase I applications.
3403.8 Proposal format for phase II applications.
3403.9 Submission of proposals.
Subpart D--Proposal Review and Evaluation
3403.10 Proposal review.
3403.11 Availability of information.
Subpart E--Supplementary Information
3403.12 Terms and conditions of grant awards.
3403.13 Notice of grant awards.
3403.14 Use of funds; changes.
3403.15 Other Federal statutes and regulations that apply.
3403.16 Other Conditions.
Authority: 15 U.S.C. 638.
Subpart A--General Information
Sec. 3403.1 Applicability of regulations.
(a) The regulations of this part apply to small business innovation
research grants awarded under the general authority of section 630 of
the Act making appropriations for Agriculture, Rural Development, and
Related Agencies' programs for fiscal year ending September 30, 1987,
and for other purposes, as made applicable by section 101(a) of Pub. L.
99-591, 100 Stat. 3341, and the provisions of the Small Business
Innovation Development Act of 1982, as amended (15 U.S.C. 638). The
Small Business Innovation Development Act of 1982, as amended, mandates
that each Federal agency with an annual extramural budget for research
or research and development in excess of $100 million participate in a
Small Business Innovation Research (SBIR) program by reserving a
statutory percentage of its annual extramural budget for award to small
business concerns for research or research and development in order to
stimulate technological innovation, use small business to meet Federal
research and development needs, increase private sector
commercialization of innovations derived from Federal research and
development, and foster and encourage the participation of socially and
economically disadvantaged small business concerns and women-owned
small business concerns in technological innovation. The U.S.
Department of Agriculture (USDA) will participate in this program
through the issuance of competitive research grants which will be
administered by the Office of Competitive Research Grants and Awards
Management, Cooperative State Research, Education, and Extension
Service (CSREES).
(b) The regulations of this part do not apply to research grants
awarded by the Department of Agriculture under any other authority.
Sec. 3403.2 Definitions.
As used in this part:
Ad hoc reviewers means experts or consultants, qualified by
training and experience in particular scientific or technical fields to
render expert advice on the scientific or technical merit of
[[Page 11258]]
grant applications in those fields, who review on an individual basis
one or several of the eligible proposals submitted to this program in
their area of expertise and who submit to the Department written
evaluations of such proposals.
Awarding official means any officer or employee of the Department
who has the authority to issue or modify research project grant
instruments on behalf of the Department.
Budget period means the interval of time into which the project
period is divided for budgetary and reporting purposes.
Commercialization means the process of developing markets and
producing and delivering products or services for sale (whether by the
originating party or by others); as used here, commercialization
includes both government and commercial markets.
Department means the Department of Agriculture.
Funding agreement is any contract, grant, or cooperative agreement
entered into between any Federal agency and any small business concern
for the performance of experimental, developmental, or research work
funded in whole or in part by the Federal Government.
Grantee means the small business concern designated in the grant
award document as the responsible legal entity to whom a grant is
awarded under this part.
Peer review group means experts or consultants, qualified by
training and experience in particular scientific or technical fields to
give expert advice on the scientific and technical merit of grant
applications in those fields, who assemble as a group to discuss and
evaluate all of the eligible proposals submitted to this program in
their area of expertise.
Principal investigator means a single individual designated by the
grantee in the grant application and approved by the Department who is
responsible for the scientific or technical direction of the project.
Therefore, the individual should have a scientific and technical
background.
Program solicitation is a formal request for proposals whereby an
agency notifies the small business community of its research or
research and development needs and interests in selected areas and
invites proposals from small business concerns in response to those
needs.
Project means the particular activity within the scope of one of
the research topic areas identified in the annual solicitation of
applications, which is supported by a grant award under this part.
Project period means the total length of time that is approved by
the Department for conducting the research project as outlined in an
approved grant application.
Research or research and development (R&D) means any activity which
is:
(1) A systematic, intensive study directed toward greater knowledge
or understanding of the subject studied;
(2) A systematic study directed specifically toward applying new
knowledge to meet a recognized need; or
(3) A systematic application of knowledge toward the production of
useful materials, devices, and systems or methods, including design,
development, and improvement of prototypes and new processes to meet
specific requirements.
Research project grant means the award by the Department of funds
to a grantee to assist in meeting the costs of conducting for the
benefit of the public an identified project which is intended and
designed to establish, discover, elucidate, or confirm information or
the underlying mechanisms relating to a research topic area identified
in the annual solicitation of applications.
Small business concern means a concern which at the time of award
of phase I and phase II funding agreements meets the following
criteria:
(1) Is organized for profit, independently owned or operated, is
not dominant in the field in which it is proposing, has its principal
place of business located in the United States, has a number of
employees not exceeding 500 (full-time, part-time, temporary, or other)
in all affiliated concerns owned or controlled by a single parent
concern, and meets the other regulatory requirements outlined in 13 CFR
part 121. Business concerns, other than licensed investment companies,
or State development companies qualifying under the Small Business
Investment Act of 1958, 15 U.S.C. 661, et seq., are affiliates of one
another when directly or indirectly one concern controls or has the
power to control the other or third parties (or party) control or have
the power to control both. Control can be exercised through common
ownership, common management, and contractual relationships. The term
``affiliates'' is defined in greater detail in 13 CFR 121.401(a)
through (m). The term ``number of employees'' is defined in 13 CFR
121.407. Business concerns include, but are not limited to, any
individual, partnership, corporation, joint venture, association, or
cooperative.
(2) Is at least 51 percent owned, or in the case of a publicly
owned business at least 51 percent of its voting stock is owned, by
United States citizens or lawfully admitted permanent resident aliens.
Socially and economically disadvantaged small business concern is
one that is:
(1) At least 51 percent owned by:
(i) An Indian tribe or a native Hawaiian organization, or
(ii) One or more socially and economically disadvantaged
individuals; and
(2) Whose management and daily business operations are controlled
by one or more socially and economically disadvantaged individuals.
Socially and economically disadvantaged individual is a member of
any of the following groups: Black Americans, Hispanic Americans,
Native Americans, Asian-Pacific Americans, Subcontinent Asian
Americans, other groups designated from time to time by the Small
Business Administration (SBA) to be socially disadvantaged, or any
other individual found to be socially and economically disadvantaged by
the SBA pursuant to section 8(a) of the Small Business Act, 15 U.S.C.
637(a).
Subcontract is any agreement, other than one involving an employer-
employee relationship, entered into by a Federal Government funding
agreement awardee requesting supplies or services required solely for
the performance of the funding agreement.
United States means the fifty States, the territories and
possessions of the United States, the Commonwealth of Puerto Rico, the
Trust Territory of the Pacific Islands, and the District of Columbia.
Women-owned small business concern means a small business concern
that is at least 51 percent owned by a woman or women who also control
and operate it. Control as used in this context means exercising the
power to make policy decisions. Operate as used in this context means
being actively involved in the day-to-day management of the concern.
Sec. 3403.3 Eligibility requirements.
(a) Eligibility of organization. (1) Each organization submitting a
proposal must qualify as a small business concern for research
purposes, as defined in Sec. 3403.2. Joint ventures and limited
partnerships are eligible to apply for and to receive research grants
under this program, provided that the entity created qualifies as a
small business
[[Page 11259]]
concern in accordance with section 2(3) of the Small Business Act (15
U.S.C. 632) and as defined in Sec. 3403.2 of this part. For both phase
I and phase II the research must be performed in the United States.
(2) A minimum of two-thirds of the research or analytical work, as
determined by budget expenditures, must be performed by the proposing
organization under phase I grants. For phase II awards, a minimum of
one-half of the research or analytical effort must be conducted by the
proposing organization. The space used by the SBIR awardee to conduct
the research must be space over which it has exclusive control for the
period of the grant.
(b) Eligibility of principal investigator. (1) It is strongly
suggested that the individual responsible for the scientific or
technical direction of the project be designated as the principal
investigator. In addition, the primary employment of the principal
investigator must be with the proposing small business concern at the
time of award and during the conduct of the proposed research. Primary
employment means that more than one-half of the principal
investigator's time is spent in the employ of the small business
concern. Primary employment with the small business applicant precludes
full-time employment with another organization.
(2) If the proposed principal investigator is employed by another
organization (e.g., university or another company) at the time of
submission of the application, documentation must be submitted with the
proposal from the principal investigator's current employer verifying
that, in the event of an SBIR award, he/she will become a less-than
half-time employee of such organization and will remain so for the
duration of the SBIR project.
Subpart B--Program Description
Sec. 3403.4 Three-phase program.
The Small Business Innovation Research Grants Program will be
carried out in three separate phases described in this section. The
first two phases are designed to assist USDA in meeting its research
and development objectives and will be supported with SBIR funds. The
purpose of the third phase is to pursue the commercial applications or
objectives of the research carried out in phases I and II through the
use of private or Federal non-SBIR funds.
(a) Phase I is the initial stage in which the scientific and
technical merit and feasibility of an idea related to one of the
research areas described in the program solicitation is evaluated,
normally for a period not to exceed 6 months. In special cases,
however, where a proposed research project requires more than 6 months
to complete, a longer grant period may be considered. A proposer of a
phase I project with an anticipated duration beyond 6 months should
specify the length and duration in the proposal at the time of its
submission to USDA in order for it to be considered at the time of
award. (See Sec. 3403.14(c) for changes in project period subsequent to
award).
(b) Phase II is the principal research or research and development
effort in which the results from Phase I are expanded upon and further
pursued, normally for a period not to exceed 24 months. Only those
small businesses previously receiving phase I awards are eligible to
submit phase II proposals. For each phase I project funded the awardee
may apply for a phase II award only once. Phase I awardees who for
valid reasons cannot apply for phase II support in the next fiscal year
funding cycle may apply for support not later than the second fiscal
year funding cycle.
(c) Phase III is to stimulate technological innovation and the
national return on investment from research through the pursuit of
commercial objectives resulting from the work supported by SBIR funding
carried out in phases I and II. This portion of the project is
performed by the small business concern and privately funded or
Federally funded by a non-SBIR source through the use of a follow-on
funding commitment. A follow-on funding commitment is an agreement
between the small business concern and a provider of follow-on capital
for a specified amount of funds to be made available to the small
business concern for further development of their effort upon achieving
certain mutually agreed upon technical objectives during phase II.
Subpart C--Preparation and Submission of Proposals
Sec. 3403.5 Requests for proposals.
(a) Phase I. A program solicitation requesting phase I proposals
will be prepared each fiscal year in which funds are made available for
this purpose. The solicitation will contain information sufficient to
enable eligible applicants to prepare grant proposals and will include
descriptions of specific research topic areas which the Department will
support during the fiscal year involved, forms to be completed and
submitted with proposals, and special requirements. A notice will be
published in the Federal Register informing the public of the
availability of the program solicitation.
(b) Phase II. For each fiscal year in which funds are made
available for this purpose, the Department will send a letter
requesting phase II proposals from the phase I grantees eligible to
apply for phase II funding in that fiscal year. The letter will be
accompanied by the solicitation which contains information sufficient
to enable eligible applicants to prepare grant proposals and includes
forms to be submitted with proposals as well as special requirements.
Sec. 3403.6 General content of proposals.
(a) The proposed research must be responsive to one of the USDA
program interests stated in the research topic descriptions of the
program solicitation.
(b) Proposals must cover only scientific/technological research
activities. A small business concern must not propose product
development, technical assistance, demonstration projects, classified
research, or patent applications. Many of the research projects
supported by the SBIR program lead to the development of new products
based upon the research results obtained during the project. However,
projects that seek funding solely for product development where no
research is involved, i.e. the funds are needed to permit the
development of a project based on previously completed research, will
not be accepted. Literature surveys should be conducted prior to
preparing proposals for submission and must not be proposed as a part
of the SBIR phase I or phase II effort. Proposals principally for the
development of proven concepts toward commercialization or for market
research should not be submitted since such efforts are considered the
responsibility of the private sector and therefore are not supported by
USDA.
(c) A proposal must be limited to only one topic. The same proposal
may not be submitted under more than one topic. However, an
organization may submit separate proposals on the same topic. Where
similar research is discussed under more than one topic, the proposer
should choose that topic whose description appears most relevant to the
proposer's research concept. Duplicate proposals will be returned to
the applicant without review.
(d) The limitation on the length of phase I and phase II proposals,
text instructions, and the formatting instructions will be identified
in the annual solicitation.
[[Page 11260]]
Sec. 3403.7 Proposal format for phase I applications.
(a) The following items relate to phase I applications. Further
instructions or descriptions for these items as well as any additional
items to be included will be provided in the annual solicitation, as
necessary.
(1) Proposal cover sheet. Photocopy and complete Form CSREES-667 in
the program solicitation. The original of the proposal cover sheet must
at a minimum contain the pen-and-ink signatures of the proposed
principal investigator(s) and the authorized organizational official.
(2) Project summary. Photocopy and complete Form CSREES-668 in the
program solicitation. The technical abstract should include a brief
description of the problem or opportunity, project objectives, and a
description of the effort. Anticipated results and potential commercial
applications of the proposed research also should be summarized in the
space provided. Keywords, to be provided in the last block on the page,
should characterize the most important aspects of the project. The
project summary of successful proposals may be published by USDA and,
therefore, should not contain proprietary information.
(3) Technical content. The main body of the proposal should
include:
(i) Identification and significance of the problem or opportunity.
(ii) Background and rationale.
(iii) Relationship with future research or research and
development.
(iv) Phase I technical objectives.
(v) Phase I work plan.
(vi) Related research or research and development.
(4) Key personnel and bibliography. Identify key personnel involved
in the effort, including information on their directly related
education and experience.
(5) Facilities and equipment. Describe the types, location, and
availability of instrumentation and physical facilities necessary to
carry out the work proposed. Items of equipment to be purchased must be
fully justified under this section.
(6) Consultants. Involvement of university or other consultants in
the planning and research stages of the project is permitted and may be
particularly helpful to small firms which have not previously received
Federal research awards. If such involvement is intended, it should be
described in detail.
(7) Potential post application. Briefly describe:
(i) Whether and by what means the proposed research appears to have
potential commercial application;
(ii) Whether and by what means the proposed research appears to
have potential use by the Federal Government; and
(iii) Whether and by what means the proposed research will satisfy
the public interest.
(8) Current and pending support. If a proposal, substantially the
same as the one being submitted, has been previously funded or is
currently funded, pending, or about to be submitted to another Federal
agency or to USDA in a separate action, the proposer must provide the
following information:
(i) Name and address of the agency(s) to which a proposal was
submitted, or will be submitted, or from which an award is expected or
has been received.
(ii) Date of actual or anticipated proposal submission or date of
award, as appropriate.
(iii) Title of proposal or award, identifying number assigned by
the agency involved, and the date of program solicitation under which
the proposal was submitted or the award was received.
(iv) Applicable research topic area for each proposal submitted or
award received.
(v) Title of research project.
(vi) Name and title of principal investigator for each proposal
submitted or award received. USDA will not make awards that duplicate
research funded (or to be funded) by other Federal agencies.
(9) Cost breakdown on proposal budget. Photocopy and complete the
budget form in the program solicitation only for the phase under which
you are currently applying. (An applicant for phase I funding should
not submit both phase I and II budgets.)
(10) Research involving special considerations. If the proposed
research will involve recombinant DNA molecules, human subjects at
risk, or laboratory animal care, the proposal must so indicate and
include an assurance statement (Form CSREES-662) as the last page of
the proposal. The original of the assurance statement must at a minimum
contain the pen-and-ink signature of the authorized organizational
official. In order to complete the assurance statement, the proposer
may be required to have the research plan reviewed and approved by an
appropriate ``Institutional Review Board'' (IRB) prior to commencing
actual substantive work. If an IRB review is required, USDA will not
release funds for an award until proper documentation of the IRB
approval is submitted to and accepted by USDA. It is suggested that
proposers contact local universities, colleges, or nonprofit research
organizations which have established such reviewing mechanisms to have
this service performed.
(11) Proprietary information. (i) If a proposal contains
proprietary information that constitutes a trade secret, proprietary
commercial or financial information, confidential personal information,
or data affecting the national security, it will be treated in
confidence to the extent permitted by law, provided the information is
clearly marked by the proposer with the term ``confidential proprietary
information'' and provided the following legend appears in the
designated area at the bottom of the proposal cover sheet (Form CSREES-
667): The following pages (specify) contain proprietary information
which (name of proposing organization) requests not be released to
persons outside the Government, except for purposes of evaluation.
(ii) USDA by law is required to make the final decision as to
whether the information is required to be kept in confidence.
Information contained in unsuccessful proposals will remain the
property of the proposer. However, USDA will retain for one year one
file copy of all proposals received; extra copies will be destroyed.
Public release of information for any proposal submitted will be
subject to existing statutory and regulatory requirements. Any proposal
which is funded will be considered an integral part of the award and
normally will be made available to the public upon request except for
designated proprietary information that is determined by USDA to be
proprietary information.
(iii) The inclusion of proprietary information is discouraged
unless it is necessary for the proper evaluation of the proposal. If
proprietary information is to be included, it should be limited, set
apart from other text on a separate page, and keyed to the text by
numbers. It should be confined to a few critical technical items which,
if disclosed, could jeopardize the obtaining of foreign or domestic
patents. Trade secrets, salaries, or other information which could
jeopardize commercial competitiveness should be similarly keyed and
presented on a separate page. Proposals or reports which attempt to
restrict dissemination of large amounts of information may be found
unacceptable by USDA. Any other legend than that listed in paragraph
(a)(11)(i) of this section may be unacceptable to USDA and may
constitute grounds for return of the
[[Page 11261]]
proposal without further consideration. Without assuming any liability
for inadvertent disclosure, USDA will limit dissemination of such
information to its employees and, where necessary for the evaluation of
the proposal, to outside reviewers on a confidential basis.
(12) Rights in data developed under SBIR funding agreement. The
SBIR legislation provides for ``retention of rights in data generated
in the performance of the contract by the small business concern.''
(i) The legislative history clarifies that the intent of the
statute is to provide authority for the participating agency to protect
technical data generated under the funding agreement, and to refrain
from disclosing such data to competitors of the small business concern
or from using the information to produce future technical procurement
specifications that could harm the small business concern that
discovered and developed the innovation until the small business
concern has a reasonable chance to seek patent protection, if
appropriate.
(ii) Therefore, except for program evaluation, participating
agencies shall protect such technical data for a period of not less
than 4 years from the completion of the project from which the data
were generated unless the agencies obtain permission to disclose such
data from the contractor or grantee. The government shall retain a
royalty-free license for government use of any technical data delivered
under an SBIR funding agreement whether patented or not.
(13) Organizational management information. Before the award of an
SBIR funding agreement, USDA requires the submission of certain
organizational management, personnel and financial information to
assure the responsibility of the proposer. This information is not
required unless a project is recommended for funding, and then it is
submitted on a one-time basis only. However, new information should be
submitted if a small business concern has undergone significant changes
in organization, personnel, finance, or policies including those
relating to civil rights.
Sec. 3403.8 Proposal format for phase II applications.
(a) The following items relate to phase II applications. Further
instructions or descriptions for these items as well as any additional
items to be included will be identified in the annual solicitation, as
necessary.
(1) Proposal cover sheet. Follow instructions found in
Sec. 3403.7(a)(1) of this part.
(2) Project summary. Follow instructions found in Sec. 3403.7(a)(2)
of this part.
(3) Phase I results. The proposal should contain an extensive
section that lists the phase I objectives and makes detailed
presentation of the phase I results. This section should establish the
degree to which phase I objectives were met and feasibility of the
proposed research project was established.
(4) Proposal. Since phase II is the principal research and
development effort, proposals should be more comprehensive than those
submitted under phase I. However, the outline contained in
Sec. 3403.7(a)(3) of this part should be followed, tailoring the
information requested to the phase II project.
(5) Cost breakdown on proposal budget. For phase II, a detailed
budget is required for each year of requested support. In addition, a
summary budget is required detailing the requested support for the
overall project period.
(6) Organizational management information. Each phase II awardee
will be asked to submit an updated statement of financial condition
(such as the latest audit report, financial statements or balance
sheet).
(7) Follow-on funding commitment. If the proposer has obtained a
contingent commitment for phase III follow-on funding, it should be
forwarded with the phase II application.
(8) Documentation of multiple phase II awards. (i) An applicant
that submits a proposal for a funding agreement for phase I and has
received more than 15 phase II awards during the preceding 5 fiscal
years, must document the extent to which it was able to secure phase
III funding to develop concepts resulting from previous phase II
awards. This documentation should include the name of the awarding
agency, date of award, funding agreement number, topic or subtopic
title, amount and date of phase II funding and commercialization status
for each phase II award.
(ii) USDA shall collect and retain the information submitted under
paragraph (a)(8)(i) of this section at least until the General
Accounting Office submits the report required under section 106 of the
Small Business Research and Development Enhancement Act of 1992.
Sec. 3403.9 Submission of proposals.
The program solicitation for phase I proposals and the letter
requesting phase II proposals will provide the deadline date for
submitting proposals, the number of copies to be submitted, and the
address where proposals should be mailed or delivered.
Subpart D--Proposal Review and Evaluation
Sec. 3403.10 Proposal review.
(a) All research grant applications will be acknowledged.
(b) Phase I and phase II proposals will be judged competitively in
a two-stage process, based primarily upon scientific or technical
merit. First, each proposal will be screened by USDA scientists to
ensure that it is responsive to stated requirements contained in the
program solicitation. Proposals found to be responsive will be
technically evaluated by peer scientists knowledgeable in the
appropriate scientific field using the criteria identified in the
annual solicitation, as appropriate. Proposals found to be
nonresponsive will be returned to the proposing firm without review.
(c) Both internal and external peer reviewers may be used during
the technical evaluation stage of this process. Selections will be made
from among recognized specialists who are uniquely qualified by
training and experience in their respective fields to render expert
advice on the merit of proposals received. It is anticipated that such
experts will include those located in universities, Government, and
non-profit research organizations. If possible, USDA intends that peer
review groups shall be balanced with minority and female representation
and with an equitable age distribution.
(d) Technical reviewers will base their conclusions and
recommendations on information contained in the phase I or phase II
proposal. It cannot be assumed that reviewers are acquainted with any
experiments referred to within a proposal, with key individuals, or
with the firm itself. Therefore, the proposal should be self-contained
and written with the care and thoroughness accorded papers for
publication.
(e) Final decisions will be made by USDA based upon the ratings
assigned by reviewers and consideration of other factors, including the
potential commercial application, possible duplication of other
research, any critical USDA requirements, and budget limitation. In
addition, the follow-on funding commitment will be a consideration for
phase II proposals. In the event that two or more phase II proposals
are of approximately equal technical merit, the follow-on funding
commitment for continued development in phase III will be an important
consideration. The value of the commitment will depend upon the degree
of commitment made by non-Federal investors, with the maximum value
resulting from a signed agreement
[[Page 11262]]
with reasonable terms for an amount at least equal to the funding
requested from USDA in phase II.
Sec. 3403.11 Availability of information.
Information regarding the peer review process will be made
available to the extent permitted under the Freedom of Information Act
(5 U.S.C. 552), the Privacy Act (5 U.S.C. 552a), the SBIR Policy
Directive, and implementing Departmental and other Federal regulations.
Implementing Departmental regulations are found at 7 CFR part 1.
Subpart E--Supplementary Information
Sec. 3403.12 Terms and conditions of grant awards.
Within the limit of funds available for such purpose, the awarding
official shall make research project grants to those responsible,
eligible applicants whose proposals are judged most meritorious in the
announced program areas under the evaluation criteria and procedures
set forth in the annual solicitation. The beginning of the project
period shall be no later than September 30 of the Federal fiscal year
in which the project is approved for support. All funds granted under
this part shall be expended solely for the purpose for which the funds
are granted in accordance with the approved application and budget, the
regulations of this part, the terms and conditions of the award, the
Federal Acquisition Regulation (48 CFR part 31), and the Department's
Uniform Federal Assistance Regulations (7 CFR part 3015).
Sec. 3403.13 Notice of grant awards.
(a) The grant award document shall include, at a minimum, the
following:
(1) Legal name and address of performing organization.
(2) Title of project.
(3) Name(s) and address(es) of the Principal Investigator(s).
(4) Identifying grant number assigned by the Department.
(5) Project period, which specifies how long the Department intends
to support the effort.
(6) Total amount of Federal financial assistance approved for the
project period.
(7) Legal authorities under which the grant is awarded.
(8) Approved budget plan for categorizing project funds to
accomplish the stated purpose of the grant award.
(9) Other information or provisions deemed necessary by the
Department to carry out its granting activities or to accomplish the
purpose of a particular research project grant.
(b) The notice of grant award, in the form of a letter, will
provide pertinent instructions and information to the grantee which are
not included in the grant award document described in paragraph (a) of
this section.
Sec. 3403.14 Use of funds; changes.
(a) Delegation of fiscal responsibility. The grantee may not in
whole or in part delegate or transfer to another person, institution,
or organization the responsibility for use or expenditure of grant
funds.
(b) Change in project plans. (1) The permissible changes by the
grantee, principal investigator(s), or other key project personnel in
the approved research project grant shall be limited to changes in
methodology, techniques, or other aspects of the project to expedite
achievement of the project's approved goals. If the grantee and/or the
principal investigator(s) are uncertain as to whether a change complies
with this provision, the question must be referred to the Authorized
Departmental Officer (ADO) for a final determination.
(2) Changes in approved goals, or objectives, shall be requested by
the grantee and approved in writing by the ADO prior to effecting such
changes. In no event shall requests for such changes be approved which
are outside the scope of the original approved project.
(3) Changes in approved project leadership or the replacement or
reassignment of other key project personnel shall be requested by the
grantee and approved in writing by the ADO prior to effecting such
changes.
(4) Transfers of actual performance of the substantive programmatic
work in whole or in part and provisions for payment of funds, whether
or not Federal funds are involved, shall be requested by the grantee
and approved in writing by the ADO prior to effecting such transfers.
(c) Changes in project period. The project period may be extended
by the ADO to complete or fulfill the purposes of an approved project
provided Federal funds remain. The extension shall be conditioned upon
a prior request by the grantee and approval in writing by the ADO. In
such cases the extension will not normally exceed 12 months, the phase
I award will still be limited to the approved award amount, and the
submission of a Phase II proposal will be delayed by one year. The
extension allows the grantee to continue expending the remaining
Federal funds for the intended purpose over the extension period. In
instances where no Federal funds remain, it is unnecessary to approve
an extension since the purpose of the extension is to continue using
Federal funds. The grantee may opt to continue the Phase I project
after the grant's termination and closeout, however, the grantee would
have to do so without additional Federal funds. In the latter case, no
communication with USDA is necessary. However, the maximum delay for
submission of a Phase II proposal remains as specified in
Sec. 3403.4(b).
(d) Changes in approved budget. Changes in an approved budget shall
be requested by the grantee and approved in writing by the ADO prior to
instituting such changes if the revision will:
(1) Involve transfers of amounts budgeted for indirect costs to
absorb an increase in direct costs;
(2) Involve transfers of amounts budgeted for direct costs to
accommodate changes in indirect cost rates negotiated during a budget
period and not approved when a grant was awarded;
(3) Result in a need or claim for the award of additional funds; or
(4) Involve transfers or expenditures of amounts requiring prior
approval as set forth in the Departmental regulations or in the grant
award.
Sec. 3403.15 Other Federal statutes and regulations that apply.
Several other Federal statutes and/or regulations apply to grant
proposals considered for review or to research project grants awarded
under this part. These include but are not limited to:
7 CFR part 1.1--USDA implementation of Freedom of Information
Act.
7 CFR part 1c--USDA implementation of the Federal Policy for the
Protection of Human Subjects;
7 CFR part 3--USDA implementation of OMB Circular A-129,
Managing Federal Credit Programs.
7 CFR part 15, subpart A--USDA implementation of Title VI of the
Civil Rights Act of 1964, as amended.
7 CFR part 3015--USDA Uniform Federal Assistance Regulations,
implementing OMB directives where applicable (i.e., Circular Nos. A-
102, A-110, A-87, A-21, and A-122) and incorporating provisions of
31 U.S.C. 6301-6308 (formerly the Federal Grant and Cooperative
Agreement Act of 1977, Pub. L. 95-224), as well as general policy
requirements applicable to recipients of Departmental financial
assistance.
7 CFR part 3017, as amended--USDA implementation of
Governmentwide Debarment and Suspension (Nonprocurement) and
Governmentwide Requirements for Drug-Free Workplace (Grants), as
amended.
7 CFR part 3018--USDA implementation of New Restrictions on
Lobbying. Imposes new prohibitions and requirements for disclosure
and certification related to lobbying on recipients of Federal
contracts, grants, cooperative agreements, and loans.
[[Page 11263]]
7 CFR part 3407--CSREES procedures to implement the National
Environmental Policy Act.
9 CFR parts 1, 2, 3, and 4--USDA implementation of the Act of
August 24, 1966, Pub. L. 89-544, as amended (commonly known as the
Laboratory Animal Welfare Act).
48 CFR part 31--Contract Cost Principles and Procedures of the
Federal Acquisition Regulation.
29 U.S.C. 794, section 504--Rehabilitation Act of 1973, and 7
CFR part 15B (USDA implementation of statute), prohibiting
discrimination based upon physical or mental handicap in Federally
assisted programs.
35 U.S.C. 200 et seq.--Bayh-Dole Act, controlling allocation of
rights to inventions made by employees of small business firms and
domestic nonprofit organizations, including universities, in
Federally assisted programs (implementing regulations are contained
in 37 CFR part 401).
Sec. 3403.16 Other conditions.
The Department may, with respect to any research project grant,
impose additional conditions prior to or at the time of any award when,
in the Department's judgment, such conditions are necessary to assure
or protect advancement of the approved project, the interests of the
public, or the conservation of grant funds.
Done at Washington, DC, this 4th day of March 1997.
B. H. Robinson,
Administrator, Cooperative State Research, Education, and Extension
Service.
[FR Doc. 97-5914 Filed 3-10-97; 8:45 am]
BILLING CODE 3410-22-P
