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PROPOSAL PREPARATION INSTRUCTIONS AND REQUIREMENTS

Description:

3.1 Proposal Requirements

A proposal to the Science and Technology Directorate, under the DHS SBIR Program, must provide sufficient information to persuade DHS that the proposed work represents an innovative approach to the investigation of an important scientific or engineering problem and is worthy of support under the stated criteria. The proposed research or research and development must be responsive to the chosen topic (see Section 4.1 of this Solicitation). Any small business contemplating submitting a proposal for work on any specific topic shall determine that (a) the technical approach has a reasonable chance of meeting the topic objective, (b) this approach is innovative, not routine, with commercial application, and (c) the company has the capability to implement the technical approach, i.e., has or can obtain people and equipment suitable to the task.

Classified proposals are not accepted under the DHS SBIR Program. Classified proposals will not be accepted under this DHS SBIR Solicitation and will be appropriately destroyed upon receipt. In the event that classified work will be undertaken in Phase II, companies invited to submit a proposal must have or be able to obtain the proper facility and personnel clearances in order to perform Phase II work.

Proposers must be registered in the DHS SBIR Proposal Submission system at https://sbir2.st.dhs.gov in order to prepare and submit proposals (see Section 6.0).

3.2 Administrative and Technical Checklist

Proposers responding to this Solicitation should note the administrative and technical preparation tips listed below.

a. Read and follow all instructions contained in this Solicitation.

b. IMPORTANT: Please refer to the “Registrations and Submissions Training Guide” at https://sbir2.st.dhs.gov and click on “Reference Materials” for step-by-step instructions for registering your company and submitting your proposal.

c. IMPORTANT: Before submitting a proposal for the first time, your company must first be registered in the system. It is recommended that the Business Official, or an authorized representative designated by the Business Official, be the first person to register your company. Your company’s Taxpayer Identification Number (TIN) is required during registration. (If your company does not have a TIN, you can generate a unique ID by following the prompts provided in the system.) After your company is registered, new users must register by associating their information with the company’s existing record. You will need to know your company’s TIN, the state where your company is registered as a taxpayer, and the Company PIN (Personal Identification Number) that was established at the time the company was registered in the system. When registration is complete, users can begin the proposal submission process.

d. Submit your proposal electronically via the website (https://sbir2.st.dhs.gov) and prepare your SBIR Proposal as instructed on the website. A complete full Proposal consists of Cover Sheet A, Cover Sheet B, the Cost Proposal, the Technical Proposal, and an optional Briefing Chart (template provided in Section 10). (For Phase II Proposals, a Company Commercialization Report is also required if the proposer has received prior SBIR Phase II funding.) Cover Sheets A and B, as well as the Cost Proposal, are fillable forms in the system and completed online. The Cover Sheet consists of two different forms – Cover Sheet A and B – which must be completed. The Cost Proposal page has seven different sections/tabs that must be completed (tabs are labeled as follows: Section A, Section B, Section C, Section D, Section E, Section F, and Summary). The Technical Proposal must be uploaded in PDF format from a computer via the Internet utilizing a secure communications protocol. The Technical Proposal must not exceed 10 MB. An optional Briefing Chart (PDF format, not to exceed 2MB) may be uploaded to the system. The Briefing Chart must not contain proprietary data. IMPORTANT – Completing the Cover Sheets, Cost Proposal, and uploading the Technical Proposal and optional Briefing Chart is not sufficient. You must submit your proposal within the electronic submission system by first clicking the Submit Proposal link. Once the “Submit Proposal” confirmation page is displayed, 0review it to ensure all forms have been completed. It is recommended that you print this page for your records. Finally, you must click the “Submit Proposal” button to submit your proposal. The system will automatically send a Submission Confirmation email to the email address of the user submitting the Proposal, and the email addresses of the PI and the POC specified on Cover Sheet B. If you do not receive an email, contact the Help Desk as instructed in Section 1.6 of this Solicitation.

e. The Technical Proposal adheres to the topic description requirements and the Cost Proposal adheres to the funding thresholds specified in this Solicitation. Both the Technical Proposal and the Cost Proposal adhere to the requirements of this Solicitation.

f. The Technical Abstract entered in Cover Sheet B, limited to 250 words, contains NO proprietary information. The Technical Abstract must summarize the implications of the approach and the anticipated results of both Phase I and Phase II, including an assessment of technology readiness levels (TRLs) at the beginning and end of the resultant Phase I contract. In the event of an award, this Technical Abstract will be published/posted at https://sbir2.st.dhs.gov.

g. Mark proprietary information within the Technical Proposal as instructed in Section 5.6 of this Solicitation.

h. The content in the Technical Proposal must include all of the items in Section 3.5(b) of this Solicitation in the order specified. The Phase I option is addressed, if applicable.

i. The header on each page of your Technical Proposal must contain your company name, topic number, and proposal number. (The header may be included in the one-inch margins.)

j. Limit your proposal to the page limitations established for Phase I and/or Phase II proposals.

k. Use a type size no smaller than a 12-point font on standard 8 1/2 " X 11" paper with one (1) inch margins.

l. The Technical Proposal must not be in two-column or more format. The Technical Proposal must be submitted in Portable Document Format (PDF) format. Do not upload security/password protected files. The proposer is responsible for performing a virus check on each submitted technical proposal. As a standard part of entering the proposal into the processing system, DHS will scan each electronic technical proposal for viruses. The detection, by DHS, of a virus on any electronically submitted technical proposal, may cause rejection of the proposal.

3.3 Proprietary Information

If information is provided that the proposer believes constitutes a trade secret, proprietary commercial or financial information, or personal information or data, it will be treated in confidence to the extent permitted by law, provided that it is clearly marked in accordance with Section 5.6 of this Solicitation. Note if the optional Briefing Chart is provided, it must not contain proprietary data.

3.4 Limitations on Length of Proposal

This Solicitation is designed to reduce the investment of time and cost to small business concerns in preparing a formal proposal. Those who wish to respond must submit a direct, concise, and informative research or research and development proposal of no more than the page limitations established for Phase I and/or Phase II Proposals, including proposal cover sheets and cost proposal. Promotional and non-project related discussion is discouraged and will not be evaluated if submitted. The space allocated to each section will depend on the problem chosen and the principal investigator's approach. In the interest of fairness, pages in excess of the Phase I, 25-page limitation (and Phase II, 50-page limitation) (including attachments, appendices, or references) will not be considered for review or award.

3.5 Phase I Proposal Format

The Phase I Proposal length is limited to 25 pages.

a. Proposal Cover Sheets. Prepare the Proposal Cover Sheets (A and B) (as provided on the electronic submission website https://sbir2.st.dhs.gov), including a brief technical abstract of the proposed R&D project and a discussion of anticipated benefits and potential commercial applications. Cover Sheet A will count as one page towards the 25 page limit of your proposal no matter how it prints out. Cover Sheet B counts as one page towards the 25 page limit no matter how it prints out. The Cost Proposal counts as one page towards the 25 page limit no matter how it prints out. The Technical Proposal is not to exceed 22 pages, including the table of contents and all graphics. The optional one-page Briefing Chart (if submitted) is not included in the 25 page limit and must not contain proprietary data. If your proposal is selected for award, the technical abstract (limited to 250 words) will be publicly released/posted on the DHS SBIR website and the Small Business Administration’s TechNet website; therefore, do not include proprietary or classified information in the Technical Abstract section of Cover Sheet B.

b. Technical Proposal. Create a single file that covers the following items in the order given below. Begin your Technical Proposal on Page 3 (since the Cover Sheets are pages 1 and 2) and put your company name, topic number, and proposal number in the header of each page. (The header may be included in the one-inch margins.) The Technical Proposal must not be longer than 22 pages, since the Cover Sheets count as two pages and the Cost Proposal counts as one page (no matter how they print out). The Technical Proposal file must be in Portable Document Format (PDF) for evaluation purposes. Perform a virus check before uploading the Technical Proposal file. If a virus is detected, it may cause rejection of the proposal. The Technical Proposal must be a single file, including graphics and table of contents (if included). Do not lock, password protect, or encrypt the file you upload.

(1) Identification and Significance of the Problem or Opportunity. Succinctly define the specific technical problem or opportunity addressed; the proposed innovation; the relevance and significance of the proposed innovation to a need(s) within the topic description; the proposed innovation relative to the state of the art; and the importance of the work proposed.

(2) Phase I Technical Objectives. State the specific objectives of the Phase I R/R&D effort including the technical questions that must be answered to determine the feasibility of the proposed innovation/approach.

(3) Phase I Work Plan. Provide an explicit, detailed description of the Phase I approach. The Plan must indicate what is planned, how, when, and where the work will be carried out, a schedule of major events, the final product to be delivered, and the completion date of the effort. The Phase I effort must determine the technical feasibility of the proposed concept. The methods planned to achieve each objective or task must be discussed explicitly and in detail. Task descriptions, schedules, resource allocations, estimated task hours for each key personnel and planned accomplishments, including project milestones, must be included. This section must be a substantial portion of the total proposal.

(4) Related Work. Describe significant (current and/or previous) activities directly related to the proposed effort, including any conducted by the principal investigator, the proposing small business, consultants, or others. Describe how these activities interface with the proposed project and discuss any planned coordination with outside sources. The proposal must persuade reviewers of the proposer’s awareness of the state-of-the-art in the specific topic. Describe previous work not directly related to the proposed effort but similar. Provide the following: (a) short description, (b) client for which work was performed (including individual to be contacted and phone number), and (c) date of completion.

(5) Relationship with Future Research or Research and Development.

(a) State the anticipated results of the proposed approach, assuming project success through Phase I and Phase II.

(b) Discuss the significance of the Phase I effort in providing a foundation for Phase II research or research and development effort, application and commercialization efforts (Phase III).

(6) Commercialization Strategy. Describe, in approximately two (2) pages, your company's strategy for commercializing this technology in DHS, other Federal Agencies, and/or private sector markets. Provide specific information on the market need the technology will address and the size of the market. Also, include a schedule showing the quantitative commercialization results from this SBIR project that your company expects to achieve and when (i.e., amount of additional investment, sales revenue, etc.).

(7) Key Personnel. Identify key personnel who will be involved in the Phase I effort including information on directly related education and experience. A concise resume of the principal investigator, including a list of relevant publications (if any), must be included (please do not include Privacy Act Information in the resume). All resumes will count toward the 25-page limitation. Identify any non-U.S. citizen(s) that you expect to be involved on this project (including direct employees, subcontractors and consultants), their country of origin, type of visa or work permit under which they are performing, and an explanation of their anticipated level of involvement on this project. Please do not include Privacy Act Information. You may be asked to provide additional information during negotiations in order to verify the non-U.S. citizen’s eligibility to participate on an SBIR contract. Supplemental information provided in response to this paragraph will be protected in accordance with Privacy Act (5 U.S.C. 552(a), if applicable, and the Freedom of Information Act (5 U.S.C. 552(b)(6)).

(8) Facilities/Equipment. Provide sufficient information to allow the evaluators to assess the ability of the proposer to carry out the proposed Phase I and projected Phase II and Phase III activities. Describe available instrumentation and physical facilities necessary to carry out the Phase I effort. Items of equipment to be purchased (as detailed in the Cost Proposal) must be justified under this section. Also state whether or not the facilities where the proposed work will be performed meet environmental laws and regulations of federal, state (name), and local governments for, but not limited to, the following groupings: airborne emissions, waterborne effluents, external radiation levels, outdoor noise, solid and bulk waste disposal practices, and handling and storage of toxic and hazardous materials.

Note: Government wide SBIR policies restrict the use of any SBIR funds for the use of Government equipment and facilities. This does not preclude a small business from utilizing a Government facility or Government equipment, but any charges for such use may not be paid for with SBIR funds (Small Business Administration (SBA) Policy Directive, Section 9(f)(3)). DHS may not and cannot fund the use of the Federal facility or personnel for the SBIR project with non-SBIR funds. In rare and unique circumstances, SBA may issue a waiver to this provision after review of an agency’s written justification. DHS cannot guarantee that a waiver from this policy can be obtained from SBA. The following information is required for consideration of a waiver:

(a) An explanation of why the SBIR research project requires the use of the Federal facility or personnel, including data that verifies the absence of non-federal facilities or personnel capable of supporting the research effort.

(b) The concurrence of the small business’ chief business official to use the Federal facility or personnel.

If a proposed project or product demonstration requires the use of unique Government facilities or equipment to be funded by the SBIR program, then the proposer must provide a) a letter from the small business company official explaining why the SBIR research project requires the use of the Federal facility or personnel, including data that verifies the absence of non-Federal facilities or personnel capable of supporting the research effort, and b) a statement signed by the appropriate Government official at the facility, verifying that it will be available for the required effort. The proposal should also include relevant information on the funding source(s) private, internal, or other Government. Failure to provide this explanation and the site manager’s written authorization of use may invalidate any proposal selection. If the proposer proposes the use of

SBIR funds for Government equipment or facilities, this explanation will be provided to the SBA during the waiver process.

(9) Subcontractors/Consultants. Involvement of a university or other subcontractors or consultants in the project may be appropriate (see Section 2.7 of this Solicitation). If such involvement is intended, it must be described in detail and identified in the Cost Proposal. A minimum of two-thirds of the research and/or analytical work in Phase I, as measured by direct and indirect costs, must be carried out by the proposing small business concern. No portion of an SBIR award may be subcontracted back to any Federal Government Agency or Federally Funded Research and Development Center (FFRDC). The Small Business Administration (SBA) may issue a case-by-case waiver to this provision after review of the DHS written justification that includes the following information: (a) an explanation of why the SBIR research project requires the use of the Federal/FFRDC facility or personnel, including data that verifies the absence of non-federal facilities or personnel capable of supporting the research effort; (b) the concurrence of the small business concern’s chief business official to use the Federal/ FFRDC facility or personnel. Award is contingent on DHS obtaining a waiver from the SBA.

(10) Prior, Current, or Pending Support of Similar Proposals or Awards. Warning -- While it is permissible, with proposal notification, to submit identical proposals or proposals containing a significant amount of essentially equivalent work (see Section 2.9 of this Solicitation) for consideration under numerous federal program solicitations, it is unlawful to enter into contracts or grants requiring essentially equivalent effort. If there is any question concerning this, it must be disclosed to the soliciting agency or agencies before award.

If a proposal submitted in response to this Solicitation is substantially the same as another proposal that has been funded, is now being funded, will be submitted to other agencies for funding consideration, or is pending with DHS or another Federal Agency, the proposer must so indicate on the Proposal Cover Sheet and provide the following information:

(a) Name and address of the Federal Agency(s) to which a proposal was submitted, will be submitted, or from which an award is expected or has been received.

(b) Date of proposal submission or date of award.

(c) Title of proposal.

(d) Name and title of principal investigator for each proposal submitted or award received.

(e) Title, number, and date of Solicitation(s) under which the proposal was submitted, will be submitted, or under which award is expected or has been received.

(f) If award was received, state contract number.

(g) Specify the applicable topics for each SBIR Proposal submitted or award received.

Note: If Section 3.5.b (10) of this Solicitation does not apply, state in the Proposal "No prior, current, or pending support for proposed work."

(11) Phase I Option. For submissions against the topics listed in this Solicitation, a Phase I Option may be exercised to bridge the funding gap between the Phase I and Phase II project. The Phase I Option, if exercised, will only be done so (at the Government’s discretion and subject to the availability of funds) to fund interim Phase I activities for companies that are selected for Phase II, while a Phase II contract is being negotiated. Proposers submitting proposals in response to the topics are encouraged to describe, within the 25 page limit, an option which furthers the research or research and development effort, and should describe appropriate initial Phase II activities that may lead to the successful demonstration of a product or technology. The Phase I Option covers activities over a period of up to four months. The Phase I Option must be included as part of the Phase I proposal, if the proposer would like to be considered for interim funding.

Note: If Section 3.5.b.(11) of this Solicitation does not apply, i.e., the proposer is not submitting a Phase I Option for consideration and recognizes that as a result, the proposer will not be eligible for interim funding should it be selected for Phase II.

c. Cost Proposal.

Phase I Cost Proposal. Proposers that participate in this Solicitation must complete the Phase I Cost Proposal, not to exceed the maximum dollar amount for the base Phase I effort, on line via the electronic submission website at https://sbir2.st.dhs.gov. For the topics in this Solicitation, the maximum base Phase I effort is $100,000. (Note: while you are logged in, there is a session timeout running. If you are inactive for more than 20 minutes (e.g., no keystrokes or mouse clicks on the page), you will automatically be logged out.) You may want to peruse the Cost Breakdown Guidance, found at https://sbir2.st.dhs.gov, click on “Reference Materials”, prior to initiating your Cost Proposal to become familiar with the information that you must provide. Please note that some items in the Cost Breakdown Guidance may not apply to the proposed project. If such is the case, there is no need to provide information on each and every item. What matters is that enough information be provided to allow DHS to understand how the proposer plans to use the requested funds if the contract is awarded.

(1) List all key personnel by name as well as by number of hours dedicated to the project as direct labor.

(2) Special tooling and test equipment and material cost may be included under Phases I and II. The inclusion of equipment and material will be carefully reviewed relative to need and appropriateness for the work proposed. The purchase of special tooling and test equipment must, in the opinion of the Contracting Officer, be advantageous to the Government and should be related directly to the specific topic. These may include such items as innovative instrumentation and/or automatic test equipment. Title to property furnished by the Government or acquired with Government funds will be vested with DHS unless it is determined that transfer of title to the contractor would be more cost effective than recovery of the equipment by DHS.

(3) Cost for travel funds must be justified and related to the needs of the project. DHS requests that you budget, as a minimum, travel to attend a one day project kickoff meeting in the Washington DC metropolitan area. The DHS SBIR Program Office holds kick-off meetings with all successful proposers approximately two weeks after contract award. Reasonable travel costs may include this one day meeting, as well as another one day meeting to present your project findings to your Phase I Program Manager. Travel will typically be performed at the beginning of your Phase I award or at the conclusion of the Phase I effort.

If applicable, a brief explanation of cost estimates for equipment, materials, and consultants or subcontractors can be included in the Cost Proposal. However, when a proposal is selected for award, the proposer must be prepared to submit further documentation to the Contracting Officer to substantiate costs (e.g., a detailed explanation of cost estimates for equipment, materials, and consultants or subcontractors).

If additional Cost Proposal information for the base Phase I effort is required, it may be placed at the end of your Technical Proposal (and included in the page count limitation). For more information about cost proposals and accounting standards, see the DCAA publication called “Information for Contractors” available at http://www.dcaa.mil.

Cost sharing is permitted for proposals under this Solicitation; however, cost sharing will not be considered nor will it be an evaluation factor in the consideration of a Phase I proposal.

3.6 Page Numbering

Number all pages of your proposal consecutively. The Cover Sheets (generated by the system from data entered into Cover Sheets A and B) are pages 1 and 2. The Technical Proposal begins on page 3 and continues through not more than page 24. The Cost Proposal (generated by the system from data entered by the proposer) is page 25 (no matter how it prints out). The Cost Proposal for the option effort is not included in the page count.

3.7 Prior Awards Addendum

If the proposer has received more than 15 Phase II awards in the prior five fiscal years, provide the name of the awarding agency, date of award, Phase I funding agreement number, Phase I award amount, and topic title. Also provide the award amount and date of previous Phase II funding, as well as the commercialization status for each prior Phase II award. The Prior Awards addendum is not included in the 25-page limit, but must be included in and uploaded with the Technical Proposal. The content in the addendum should be limited to the information requested in this section.

3.8 Phase III Awards Resulting from DHS SBIR Awards Addendum

If the proposer has received any Phase III awards resulting from work on any DHS SBIR award, provide related Phase I and/or Phase II contract numbers, name of the Phase III awarding agency, date of the award, funding agreement number, award amount, project title, period of performance and current commercialization status for each award. The Phase III Awards Addendum is not included in the 25-page limit, but must be included and uploaded with the Technical Proposal. The content in the addendum should be limited to the information requested in this section.

3.9 Phase II Proposal Invitation

This Solicitation is for Phase I only. A Phase II Proposal can be submitted only by a Phase I awardee and only in response to a request from the Contracting Officer. DHS S&T Program Managers for the applicable topic may recommend that Phase I participants be invited to submit Phase II Proposals based upon site visits, the monthly and/or final reports, and progress made towards the accomplishment of Phase I technical objectives and plans for Phase II. Not all Phase I participants will be invited to submit a Phase II Proposal. The number of Phase II Proposal invitations will depend upon the number of Phase I awards made in the topic, the availability of funding, and the quality of the Phase I research. DHS reserves the right to invite all, some, or none of the Phase I awardees in a topic to submit Phase II proposals.

Based on the recommendation from the cognizant topic program manager, the DHS SBIR Program Office may recommend to a Contracting Officer that a Phase I contractor be invited to submit a Phase II Proposal, beginning no earlier than two thirds (2/3) into the Phase I period of performance (DHS SBIR Jump Start feature). (Example: four months into a six month period of performance.) While some Phase II invitations will be made prior to completion of the Phase I period of performance, other Phase II invitations will be extended at the end of the period of performance. DHS will evaluate each Phase II Proposal when received in accordance with the evaluation criteria provided in Section 4.3, and if the proposal is deemed to be highly rated, will enter into negotiations for award, subject to the availability of funds. The goal is to use the SBIR Jump Start feature to accelerate the technology development and reduce, or eliminate, the gap between the Phase I and Phase II efforts.

An invitation to submit a Phase II proposal is the first step of the Phase II award process, which consists of the invitation, submission of a Phase II proposal in accordance with the Phase II proposal instructions, including the date and time set for receipt of proposal(s), evaluation of that proposal against the Phase II evaluation criteria, selection of Phase II proposals for award, and any negotiations leading to the award of a Phase II contract to those otherwise successful Phase II proposals. The Phase II invitation to submit a proposal does not commit the Government to select or make a Phase II award to the invitee.

3.10 Phase II Proposal Format

As stated previously, a separate solicitation will not be issued for Phase II. These proposals instructions are provided as information only for those organizations who may receive a Phase I award and may be invited to submit a Phase II proposal. Phase II proposal is limited to 50 pages, using a type size no smaller than a 12-point font on standard 8 ½ X 11” paper with one (1) inch margins. Two-column or more format is not allowed. Invited Phase II Proposals shall be submitted via the electronic submission website at

https://sbir2.st.dhs.gov. Paper submissions and proposals received by any other means will not be accepted, evaluated or considered for award (unless directed to otherwise).

a. Each Phase II base proposal, not to exceed $750,000 for the topics in this solicitation,, must contain Proposal Cover Sheets, a Technical Proposal, a Cost Proposal and a Company Commercialization report, if applicable. See Section 3.8 (d) of this Solicitation. In addition, each Phase II proposal must contain approximately two pages of a Commercialization Strategy in the Technical Proposal.

b. Commercialization Strategy. The Commercialization Strategy must address the following questions:

(1) What is the first product that this technology will go into?

(2) Who will be your customers, and what is your estimate of the market size?

(3) How much money will you need to bring the technology to market, and how will you raise that money?

(4) Does your company contain marketing expertise and, if not, how do you intend to bring that expertise into the company?

(5) Who are your competitors, and what is your price and/or quality advantage over your competitors?

The Commercialization Strategy must also include a schedule showing the quantitative results from the Phase II project that your company expects to report in its Company Commercialization Report Updates one year after the start of the Phase II, at the completion of Phase II, and after the completion of Phase II (i.e., amount of additional investment, sales revenue, etc. – see Sections 4.4 and 5.4 of this Solicitation).

c. Cost Match. Proposers that request Phase II Cost Match funds have an opportunity in the Commercialization Strategy to present the compelling value of the proposed Phase II project. The Commercialization Strategy should provide qualitative and quantitative information directly related to the Cost Matching; explaining the improved time interval or acceleration between the completion of Phase II work and the of launching of the innovative products, processes, or services into the marketplace. Additional Phase II Cost Match guidance can be found in Section 3.11 of this Solicitation.

d. Company Commercialization Report. For those concerns that have received prior SBIR Phase II funding, a succinct Commercialization Report must be included with the Proposal. The Company Commercialization Report is submitted online with the Phase II Technical Proposal (append it to the Phase II Technical Proposal; the Company Commercialization Report is not included in the Phase II Technical Proposal page count). The following are examples of company commercialization data expected in the Commercialization Report. Additional Commercialization Reporting requirements and Commercialization Update requirements can be found in Sections 4.4 and 5.4 of this Solicitation.

(1) Any business concern or subsidiary established for the commercial application of a product or service for which an SBIR award is made.

(2) Revenue from the sale of new products or services resulting from the research conducted under each Phase II award;

(3) Additional investment from any source, other than Phase I or Phase II awards, to further the research and development and/or commercialization conducted under each Phase II award.

(4) Whether the Phase II technology has been used in a fielded DHS system or acquisition program, and, if so, which system or program.

(5) The number of patents resulting from the contractor’s participation in the SBIR Program.

(6) Whether the company has completed an initial public offering (IPO) of stock resulting, in part, from the Phase II Project.

Update the information in the Company Commercialization Report for any prior Phase II award received by the company. The company may apportion sales or additional investment information relating to more than one Phase II award among those awards, if it notes the apportionment for each award.

e. Phase II Option. For Phase II submissions against the topics listed in this Solicitation, a Phase II Option (not to exceed $250,000) may be exercised at the DHS’ discretion to continue funding Phase II activities that will further mature the technology for insertion into a larger DHS Program or DHS Acquisition Program. The Phase II Option covers activities over a period of up to 24 months and should describe Phase II activities that may lead to the successful demonstration of a product or technology. The Phase II Option must be included within the 50-page limit for the Phase II proposal if the proposer would like to be considered for the additional Phase II funding. If a Phase II Option is proposed, it must not exceed the maximum dollar amount of $250,000. The Phase II Option Cost Proposal (if applicable) must be placed at the end of the Technical Proposal and uploaded with the Technical Proposal. The Phase II Option Cost Proposal is not included in the 50 page count limitation. Phase II costs and Phase II Option costs must be shown separately. There is no specific format for the Phase II Option Cost Proposal, but it must include all applicable categories (see the Phase I Cost Proposal for information to provide). For reference, see the Cost Breakdown Guidance at https://sbir.st.dhs.gov and click on “Reference Materials” for the type of information that may need to be provided. Please note that some items in the Cost Breakdown Guidance may not apply to the option effort. If such is the case, there is no need to provide information on each and every item. What matters is that enough information be provided to allow DHS to understand how the proposer plans to use the requested funds. If selected, the government may elect not to include the Phase II option in the negotiated contract.

3.11 SBIR Phase II Cost Match

a. General Provisions of the DHS SBIR Cost Match Feature. The DHS SBIR Program includes a Cost Match feature for SBIR projects that attract matching cash from an outside investor for the Phase II SBIR effort. The purpose is to focus SBIR funding on those projects that are most likely to be developed into viable new products that DHS and others will buy and that will thereby make a major contribution to homeland security and/or economic capabilities. The cost match can occur at the time of award, or during the Phase II period of performance.

Outside investors may include such entities as another company, a venture capital firm, an individual investor, or a non-SBIR government program; they do not include the owners of the small business, their family members, and/or affiliates of the small business. In order to be considered for DHS S&T SBIR cost match, the outside investors must commit a minimum of $100,000 up to a maximum of $500,000. DHS will, at its option, match up to 50% of funds received. The SBIR Phase II basic awards will be made for a maximum of $750,000 and the cost match award will be made for a maximum of $250,000. The total cumulative SBIR funding for the Phase II award plus DHS cost match cannot exceed $1,000,000 (or $1,250,000 if the Phase II option is exercised). Outside investors may contribute funding above the $500,000 cost match ceiling, however, DHS SBIR will only match 50% up to the $250,000 maximum.

The additional work proposed should be an expansion of the technical work being performed in the Phase II project and must fall within the general scope of the present Phase II project.

b. How to Qualify for the SBIR Phase II Cost Match. To qualify for the SBIR Cost Match feature, a company must be a Phase I awardee submitting a Phase II proposal or a Phase II awardee. The company is encouraged to discuss the application with their SBIR Program Manager and the DHS SBIR Program Director. The awardee is to follow Phase II Proposal instructions and guidance, and also provide the cost match documentation and request for matched funding.

(1) A Phase II Proposal must be submitted electronically on the DHS Electronic Submission website (https://sbir2.st.dhs.gov).

(2) The proposing company must:

(a) State that the outside investor will match funding in the SBIR Phase II proposal, in cash, and state the amount of the outside investment, contingent on the company's selection for Phase II award.

(b) Certify that the outside funding proposed in the application qualifies as a Cost Match investment, and the investor qualifies as an "outside investor," as defined above.

(c) Provide a brief statement (less than one page) describing that portion of the effort that the investor will fund. The investor's funds may pay for additional research and development on the company's SBIR project or, alternatively, they may pay for other activities not included in the Phase II Statement of Work, provided these activities further the development and/or commercialization of the technology (e.g., marketing).

(d) Provide qualitative and quantitative information reflecting any additional Period of Performance to complete the new or expanded effort. Provide a concise Statement of Work for the Cost Match effort (less than four pages) and detailed Cost Proposal (less than one page).

(3) The outside investor must provide:

(a) A brief statement describing the investor's experience in evaluating companies' abilities to successfully commercialize technology, the investor's assessment of the market for this particular SBIR technology, and of the ability of the company to bring this technology to market.

(b) A letter of commitment, signed by the investor(s), containing a commitment to provide a minimum of $100,000 or up to $500,000 Phase II Cost Match funding, in cash, contingent on the company's selection or performance of the Phase II award. An investor may contribute above the $500,000 Phase II Cost Match; however Government matching funds will not exceed 50% up to the $250,000 maximum.

(4) The Transfer of Investor Funding:

The company shall certify within 60 days that the entire amount of the matching funds from the outside investor has been transferred to the company. The Certification consists of a letter, signed by both the company and its outside investor, stating that "$______ in cash has been transferred to our company from our outside investor in accord with the SBIR Cost Match procedures." The letter must be sent to a DHS appointed Contracting Officer, along with a copy of the company's bank statement showing the funds have been deposited. The transfer of investor funds from another Government agency will be coordinated with the DHS SBIR designated Contracting Officer. IMPORTANT: If the Contracting Officer does not receive this certification showing the transfer of funds within 60 days, the company will be ineligible to compete for Phase II Cost Match funding, unless a specific written exception is granted by the DHS SBIR Program Director.

Failure to meet these conditions in their entirety and within the time frames indicated may disqualify a company from participation in the SBIR Cost Match. DHS maintains the right to award some, all, or none of the Phase II Cost Match requests. Phase II Cost Match funding is contingent upon the number of applications, availability of funds, and proper certification of investor funds.

c. Additional Reporting Requirement.

In the company's final Phase II Progress Report, a brief accounting must be included (in the company's own format or format that has been provided by the DHS PM) of how the investor's funds were expended to support the project.

3.12 False Statements

Knowingly and willfully making any false, fictitious, or fraudulent statements or representations, may be a felony under the False Statement Act (18 U.S.C. §1001), punishable by a fine of up to $10,000, up to five years in prison, or both.

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