NC’s updated solicitation gives qualifying startups a way to offset proposal costs and, after a federal award, bridge cash flow toward Phase II.
Why this matters for North Carolina startups
North Carolina’s One North Carolina Small Business Program is not a general business grant. It is a targeted SBIR/STTR support mechanism for for-profit NC businesses that are pursuing federal research awards. For founders, consultants, and small tech firms, the money angle is straightforward: the state can reimburse part of the cost of preparing a Phase I SBIR or STTR proposal, and it can also provide matching funds after a federal award to help bridge the gap between the final Phase I payment and the first Phase II payment.
That makes the program useful in two places where small businesses often feel pressure: the upfront cost of proposal writing and the cash-flow gap that can follow a successful federal award. The state’s stated purpose is to offset proposal costs and strengthen North Carolina’s SBIR/STTR pipeline.
What the FY 2027 solicitation changes
NC Commerce posted the FY 2027 Incentive Program solicitation and said online applications will be available September 14, 2026. The same program page also points applicants to the FY 2027 Matching Program solicitation, which was released December 14, 2026, along with current guidelines and the CyberGrants application system. For businesses planning fall 2026 or later federal submissions, this is an active window to prepare rather than a historical program to bookmark and forget.
The program is administered by the Office of Science, Technology & Innovation on behalf of the Board of Science, Technology & Innovation. That matters because it signals this is an ongoing state funding channel, not a one-off announcement.
The practical money terms to check before applying
The verified research brief says the incentive grant can reimburse eligible businesses for up to $12,000. Reimbursement is capped at 75% for firms in Tier 1 or Tier 2 counties and 50% for Tier 3 counties. Eligibility is limited to a for-profit North Carolina-based business with a qualified Phase I proposal to a participating federal agency, compliance with federal SBIR/STTR rules, no duplicative support, and certification that at least 51% of the Phase I research will be conducted in North Carolina and that the company will remain NC-based during the project.
For small firms, those details are not paperwork trivia. They determine whether the program can actually reduce the cost of chasing non-dilutive funding. If your team is already preparing an SBIR or STTR submission, the incentive piece can lower the effective cost of proposal development. If you win a federal award, the matching-funds piece can help cover the period when federal cash is not yet fully flowing into Phase II work.
Why this is more than a grant notice
NC Commerce’s program page shows the state has been using this structure at scale since 2006, with 525 small businesses awarded Phase I SBIR/STTR incentive and matching grants over that period. The department also highlighted FY 2026 awards to 46 small businesses in a September 3, 2026 release. According to the verified research brief, state reporting says those funds have been used for jobs, specialized equipment, intellectual property protection, and facility infrastructure.
That combination makes the program relevant beyond pure R&D. For a startup, it can free up cash for proposal preparation, reduce the cost of pursuing federal funding, and support commercialization work after an award. For service firms and consultants that help clients with SBIR/STTR proposals, the solicitation is also a reminder that state reimbursement programs can be part of the funding strategy, not just federal grants alone.
The immediate action item is simple: if you are a North Carolina-based company planning an SBIR or STTR Phase I submission, review the current solicitation and guidelines before you start the application. The program uses CyberGrants, and NC Commerce directs applicants to the OSTI staff for questions about eligibility and program terms.
