Innovation in Contracting and Focus on SBIR Phase IIIs

A. Donahoo, A. Rouse
United States

Keywords: SBIR, Phase III, contracting, innovation, CSO


The General Services Administration (GSA) is executing innovation in contracting through methods that capture emerging technologies, bring nontraditional contractors into the federal market, and ease pathways for small businesses to contract with the Government. The Office of Assisted Acquisition Services (AAS) has grown to accommodate federal demand for innovation through a robust Small Business Innovation and Research (SBIR) assisted acquisition program that has now awarded well over $2B in contract ceiling on behalf of federal agencies to eligible SBIR Phase III contractors for critical technologies. The SBIR/STTR Program was reauthorized at the end of 2022 and GSA’s Phase III program is a true solution to many of the issues brought to light in the reauthorization debate. Phase III contracts are sole source in nature, and must derive, continue, extend, or complete prior Phase I/II efforts; GAO has reaffirmed that COs have great flexibility in determining what requirements can be satisfied via a Phase III contract. There are hundreds of Phase I/II awards made each year by participating SBIR agencies, but many contracting offices lack bandwidth or expertise needed to move those technologies to the next phase. Through streamlined methodologies such as: Single Award IDIQs, minimal proposal requirements, and streamlined evaluations, GSA awards Phase III contracts at all dollar levels across various domains. Phase III awards provide valley of death solutions and help SBIR contractors achieve commercialization goals. GSA is also investigating a Multiple-Award contracting program focused on the SBIR Phase III authority. The FY2018 NDAA gave authority to the DOD to pilot a multiple award contract for SBIR; and no office has executed on this. Already a home for government-wide contracts, and with the breadth of SBIR Phase III contracting expertise in house, GSA is positioned well to research the viability of such a contracting vehicle focused on small business and innovation, and bringing the flexibility of Phase IIIs in lockstep with FAR Part 16 ordering procedures. If proved viable, this would be the first government-wide program specifically designed to support SBIR Phase III companies in the 40 year history of the SBIR/STTR program. A vehicle like this would give innovative companies a prime-contract “home” for the Gov to access SBIR solutions. This concept is in the market research phase. In addition to SBIR, GSA uses other non-traditional contracting methods to access commercial innovation for federal customers. In December of 2022, the GSA Commercial Solution Opening (CSO) authority was reauthorized and expanded in the NDAA. The CSO authority for GSA is a non-FAR based, streamlined solicitation methodology that aims to reach non-traditional contractors and start-ups through a competitive proposal and down selection process with minimal corporate/technical information. The CSO minimizes hurdles that can make prime federal contracting unattractive to some commercial companies. The CSO authority allows GSA to negotiate flexible terms and conditions, such as vendor retained IP, to entice small businesses and innovative companies to do business with the government, and to reach innovative commercial solutions through faster and streamlined acquisitions.