AAAS Preliminary Analysis Finds a Few Big R&D Gains, Many Cuts, in Proposed U.S. Budget

Kei Koizumi

President George W. Bush's budget for the 2007 budget year proposes substantial increases for key physical sciences and engineering programs as part of an American Competitiveness Initiative that was previewed in his State of the Union address in response to a growing wave of concern about the state of U.S. innovation.

Two days after the federal budget's release on 8 February, a preliminary analysis by the AAAS R&D Budget and Policy Program finds that overall federal investment in research and development (R&D) would increase to $137 billion in FY 2007, which is 1.9 percent above this year’s funding level, just short of the 2.2 percent increase needed to keep pace with projected inflation.

In a repeat of past budgets, White House priorities for developing weapons and space vehicles would take up the entire increase and more, leaving a decline in funding for the remainder of the R&D portfolio. In real terms, the total federal R&D portfolio would decline for the first time since 1996 after flattening out the last few years.

Three agencies—the National Science Foundation (NSF), the Office of Science at the U.S. Department of Energy (DOE), and the National Institute of Standards and Technology (NIST) under the U.S. Department of Commerce—would receive substantial budget increases after years of flat or declining funding. DOE also benefits from the President George W. Bush's American Energy Initiative with large increases in its energy R&D portfolio, according to the analysis by Kei Koizumi, director of the AAAS R&D Budget and Policy Program.

The large proposed increases for physical sciences and engineering research are not enough to keep the federal investment in basic and applied research (excluding development) from declining for the third year in a row after peaking in 2004. They are, however, a welcome relief for agencies with research-critical missions.

NSF's budget request includes an increase of $439 million, or 7.9 percent, over FY 2006. Most of its research directorates would receive a boost after years of flat or declining budgets. NIST's budget proposal includes an additional $104 million, an increase of 24 percent, for its laboratory programs and facilities. This would be the largest dollar increase ever for NIST's laboratory research. The DOE Office of Science would go up by $505 million to support funding for basic scientific research, a 14 percent increase, after years of flat budgets.

The federal investment in basic and applied research (excluding development and R&D facilities) would drop by 3.4 percent to $54.7 billion. This means that increases for physical sciences and related research in DOE, NSF and NIST would be more than offset by cuts in other agencies' research. The National Institutes of Health budget would be flat for the second year in a row—with spending power losing ground to inflation—and would fund less than 1 out of every 5 grant applications. The National Aeronautics and Space Administration, despite being a major sponsor of physical sciences research, would see its research funding fall to offset a big increase for the development of new space vehicles.

For more details, see the full preliminary analysis here. The preliminary analysis is a preview of the forthcoming AAAS Report on R&D in the FY 2007 Budget.

Full coverage of R&D in the administration’s proposed FY 2007 budget can be found on a new page of the AAAS Web site. Detailed agency funding tables, charts, historical data, and other R&D funding data are now available here.

In coming weeks, agency updates on the implications of the FY 2007 budget for the major R&D funding agencies will be posted, as well as revised estimates of R&D in the FY 2007 budget. The page will be continually updated over the coming year as the FY 2007 budget makes its way through Congress.

Earl Lane and Barbara Rice

8 February 2006

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