Congress to Pass Budget Deal, Set up Frenetic Appropriations Activity

After a contentious few months that saw a two-week shutdown, a narrowly-averted debt crisis, and continuing politicking over the size and shape of federal expenditures and deficits, Congress has begun to tentatively dip its collective toe in the waters of compromise. The October 17 continuing resolution that ended the shutdown and keeps government open through January 15 also established a conference committee to bridge the large gap between the House and Senate budgets. That committee, led by Rep. Paul Ryan (R-WI) and Sen. Patty Murray (D-WA), managed to find common ground and a reach a limited deal December 10. The House has already voted 332-94 to pass that deal, and the Senate is scheduled to vote on it at the time of this writing, with final passage all but assured.

For the science community, the key part of the deal is its provisions on discretionary spending. The Ryan/Murray deal would establish discretionary spending targets of $1.012 trillion in 2014 (a nominal increase of about 2.6 percent above 2013) and 1.14 trillion in 2015. For 2014, this would mean about a $45 billion increase above sequester-level spending, or a rollback of about half the cuts required under sequestration, split between defense and nondefense. The rollback for 2015 is a bit less ambitious: discretionary spending would rise by only about $19 billion above sequester-level spending. This means about 75 percent of the spending reduction required under sequestration would remain in effect.

The deal only addresses overall spending targets and does not address the budgets of individual agencies, but according to recent AAAS estimates, it could serve to boost R&D by as much as $8 billion or more over the next two years above sequester levels. While a welcome development to ease the strain of sequester on science and innovation budgets, the deal does not address the big issues like taxes and entitlement reform that are driving the deficit debate, and leaves in place most spending reductions under sequestration through 2021. This will still likely mean tens of billions of dollars in lost R&D funding, and the continued decline in federal R&D as a share of the economy (see chart).

The focus now shifts back to appropriators, who will have a limited time to complete the work on FY 2014 appropriations started months ago. No doubt, at least some science agencies will likely see a funding increase above sequester levels thanks to the deal, but the size, shape and focus of appropriations is to be determined. It is possible appropriators, by choice or necessity, will resort to passing another full-year continuing resolution like that passed for FY 2013. Such a step would finalize funding, but would also somewhat hinder agencies’ ability to start new programs or make changes to existing ones.