A bill to provide the Small Business Administration continuing authority to administer a program for small innovative firms.

(Measure passed House, amended, roll call #334 (421-1))

Amends the Small Business Act to exclude from the definition of "extramural budget" amounts obligated for operational systems development by the Department of Defense.

Amends the Small Business Innovation Development Act of 1982 to extend the Small Business Innovation Research Program under the Small Business Act until October 1, 1993.

Amends the Small Business Innovation Development Act of 1982 to require the Comptroller General, no later than December 31, 1988, to transmit a report to the appropriate congressional committees with respect to the effectiveness of phase one (determination of the scientific and technical feasibility of ideas submitted pursuant to the Small Business Innovation Research Program) and phase two (further development of those ideas) of the Small Business Innovation Research Program (SBIR) under the Small Business Act. Requires such report to determine the quality of the research supported by the SBIR program compared to that supported by affected Federal agencies and the extent to which the goals of the program have been attained.

Requires the Comptroller General, no later than December 31, 1991, to transmit to such committees an update of such report, including an evaluation of phase three (non-Federal capital to pursue commercial applications of the research or research and development of small businesses) of the SBIR program.