The U.S. Senate made Christmas merrier for small businesses that are in the vanguard of companies working on technology innovation when it reauthorized last week two key National Science Foundation (NSF) programs —the Small Business Innovation Research Program (SBIR) and the Small Business Technology Transfer Program (SBTT. The SBIR and SBTT are designed to help small businesses compete for federal research and development fund.

The legislation passed by unanimous consent and how heads to the House, where it is also expected to pass. The measure will reauthorize the SBIR program for an additional eight years, through 2018. The program, which has been running on seven short-term extensions since October 1, 2008, also increases the percentage of federal research and development funds that will go to small businesses.

The NSF supports high-risk innovation research projects in four areas: nano- and advanced materials and manufacturing; bio and chemical technologies; information and communications technologies; and education application.

The SBIR program is the federal government’s single biggest program to support innovation research in small companies.  Its sister program, the STTR, is the biggest tech transfer program.  They both provide equity-free capital that can be applied to mitigate the technical and commercial risk of an innovation project.

Reach BusinessNewsDaily senior writer Ned Smith at nsmith@techmedianetwork.com. Follow him on Twitter @nedbsmith.