R&D Budget and Policy Program

Status of FY 2013 Appropriations

Status of Appropriations Legislation for Fiscal Year 2013

Senate Appropriations Subcommittee Passes Homeland Security Spending Bill

Yesterday, the House Appropriations Subcommittee on Homeland Security voted to send the FY 2013 Homeland Security bill to the full Senate committee. According to the committee, the bill cuts $1 billion from discretionary funding below FY 2012 levels. However, the Department of Homeland Security's Science & Technology Directorate, the major source of R&D within the department, would be granted a large 25% increase, in accord with the President's budget request. See Chapter 11 of the AAAS FY 2013 R&D budget report for more (PDF). The bill will now move to consideration by the full committee, scheduled for May 17; the full House Appropriations Committee will consider its own version of the bill today.

Senate FY 2013 Homeland Security Bill Summary
DHS R&D in the President's FY 13 Request

Senate Appropriations Subcommittee Passes Military Construction/Veterans Spending Bill

Earlier today, the Senate Appropriations Subcommittee for Military Construction and Veterans Affairs voted to send the FY 2013 Military Construction/Veterans appropriations bill to the full Senate Appropriations Committee. The bill contains $71.9 billion in discretionary spending, $466 million below the President's budget and $228 million above FY 2012 funding. Most of the reductions from the President's request come from military construction, according to the committee. The major source of R&D in the bill is that performed by the Department of Veterans Affairs. Research at the VA — primarily for medical and prosthetics research — was funded at $1.2 billion in FY 2012, and the Administration's request would keep this amount flat; total VA-performed research is nearer to $2 billion when factoring in grants from other federal agencies and from private sources. See Chapter 12 of the AAAS FY 2013 R&D budget report for more (PDF). The bill will now move to consideration by the full committee.

Senate FY 2013 Milcon/Veterans Bill Summary
VA R&D in the President's FY 13 Request

House Passes CJS Bill

Last week, the House of Representatives approved its version of the FY 2013 Commerce, Justice, Science spending bill – the first of the year – on a 247-163 vote. The bill, which covers funding for NSF, NASA, NOAA, NIST, and other agencies, is more generous in many areas than might have been expected, though R&D at most agencies would fall somewhat short of the President’s request. NSF R&D would receive a $221 million or 3.9 percent boost over FY 2012 levels, slightly less than the President’s request. The House also defeated a proposed floor amendment to further reduce NSF funding by more than $1 billion, though two amendments prohibiting funding for the Climate Change Education Program ($10 million) and for political science research at NSF ($11 million) both passed.

Like NSF, NASA R&D would receive a boost above FY 2012 levels of 1.3 percent or $123 million, with cuts to space exploration more than offset by increases elsewhere. The largest increase in dollar terms was reserved for science, where the House notably provided planetary science with more than $200 million more than the request, in an attempt to offset the major cuts the Administration is seeking. Many of the increases the Administration has sought for R&D at the Department of Commerce also appear to be largely holding up. The National Institute of Standards and Technology would receive a substantial R&D boost of nearly 14 percent, while the NOAA increase comes in spite of the fact that the overall NOAA budget would be largely flat. According to the Administration’s figures, increases in NOAA’s requested FY 2013 R&D funding substantially outpaced its overall budget request. Elsewhere, the House passed amendments to end the Census Bureau’s American Community Survey and to potentially allow federal agencies to purchase alternative fuels with higher emissions profiles than regular gasoline. The CJS bill now awaits floor action in the Senate, where a version has already been approved in committee.

National Science Foundation Funding Table
National Aeronautics and Space Administration Funding Table
Department of Commerce Funding Table
Commerce, Justice Science Bills: House | Senate

House, Senate Continue Appropriations Activities on Science, Energy, Ag

Last week, the full House and Senate Appropriations Committees approved spending bills impacting the budgets for several federal agencies. Both committees passed their respective Energy and Water appropriations bills, which provide funding for the Department of Energy (DOE) and the Bureau of Reclamation, among other agencies. As previously reported, the House would trim the DOE Office of Science budget and keep funding for fossil and nuclear energy, while making more substantial cuts to effiency, renewables, and ARPA-E. The Senate version, as expected, is more generous on renewables, efficiency, ARPA-E, and the Office of Science than the House, though would not fund any of these agencies at the levels requested by the Administration; it would also substantially cut fossil energy R&D.

The Senate Appropriations Committee also approved the Agriculture spending bill, which would provide a small increase to USDA’s Agricultural Research Service, and a 3% increase to the National Institute of Food and Agriculture, matching the President’s request. The bill would also boost the Agriculture and Food Research Initiative (AFRI) by 13%, though short of the 23% increase requested by the Administration. Lastly, the House Appropriations Committee approved the Commerce, Justice, Science appropriations bill, which provides funding for NASA, NSF, and the Department of Commerce. As previously reported, the bill would provide boosts to NIST, NSF, and NOAA, while trimming the NASA budget; it would also seek to restore some of the cuts to planetary science proposed by the Administration.

The House Appropriations Committee also approved its 302(b) allocations for FY 2013, which set the appropriations framework for the subcommittees. As expected, the Committee approved a total discretionary budget of $1.029 trillion, $19 billion below the spending level agreed to in the Budget Control Act and proposed by the Administration and the Senate. The lower House levels continue to set up a conflict with the President, who has said he would veto any bills that don’t abide by the higher spending level agreed to by both parties last year.

Energy and Water bills: Senate | House
Commerce, Justice, Science bills: Senate | House
Senate Agriculture Bill
House 302(b) Allocations
Status of FY 2013 Appropriations (THOMAS)

OMB: No Sequestration for Veterans Affairs

As expected, the Office of Management and Budget (OMB) has confirmed that the Department of Veterans Affairs would be exempt from the across-the-board cuts of between 8 and 10% scheduled to take effect under the sequestration in January 2013. VA was always intended to be excluded from these cuts, but some ambiguities in the statute language had led to concerns that it would have to shoulder some of the burden. VA has a $1.2 billion research budget for health and prosthetics R&D. However, even though VA would be exempt from direct cuts, it could still feel the effects of sequestration indirectly, as it receives an additional $500 million each year from other federal agencies for R&D.

Separately, OMB last week told the House Budget Committee that it is not yet developing contingency plans for the sequestration.

See also: AAAS Analysis of Sequestration and the House Budget

AAAS Report XXXVII: Research and Development FY 2013

The complete book is now available online.

AAAS Report XXXVII: Research and Development FY 2013 The 290-page report was officially released at the AAAS S&T Policy Forum on April 26-27 and you can order your copy now. This reference work provides a comprehensive analysis of R&D in the President's FY 2013 Budget Request, including specialized analyses by theme, major agency, and discipline. Order your copy today! Non-Member / AAAS Member Non-Member $19.95 USD AAAS Member $15.95 USD

Senate Appropriations Committee Adopts Spending Limits While Markups Commence

Yesterday, the Senate Appropriations Committee adopted their subcommittee spending limits, known as "302(b) allocations" in Congressional parlance. The spending limits set the appropriations framework for the appropriations subcommittees, and are normally based on the levels established in the budget resolution, though the Senate appears unlikely to pass the resolution at this time (for a brief primer on how this process works, see this Congressional Research Service report [PDF] from 2003). The committee accepted a total discretionary budget of $1.047 trillion, matching the discretionary spending cap established in last year's Budget Control Act, and $19 billion higher than the limit established by the House budget. It is not yet clear when the House Appropriations Committee will establish its own 302(b) allocations.

Meanwhile, Senate and House appropriators have also begun the process of marking up separate spending bills related to the National Science Foundation, NASA, and the Departments of Commerce, Energy, and Transportation, among other agencies. Amid fears of major cuts in a tough fiscal environment, NSF, the National Institute of Standards and Technology, and NASA appear to be fairing well initially in both chambers. Among other items, the Senate committee proposes moving key satellite programs from the National Oceanic and Atmospheric Administration to NASA; the House bill does not. Elsewhere, the House has proposed flat funding for the Department of Energy Office of Science, but substantial cuts of 20 percent or more for ARPA-E and the Office of Energy Efficiency and Renewable Energy. Visit the links below for more.

Senate Appropriations Committee
House Appropriations Committee

New Brief: Potential Impacts of the House Budget on Federal R&D

The recently passed House budget resolution would reduce discretionary spending dramatically, and many are concerned about the potential impacts of these cuts on federal R&D, especially in light of the looming across-the-board cuts known as the sequestration; yet it has not been clear exactly what the impacts might be. To try to answer this question, we've produced an estimate that gets at some actual dollar figures and percentage changes, organized by R&D category. The estimate is based on House (PDF) and Administration (PDF) spending proposals, analyses of the automatic spending cuts in the Budget Control Act, and current R&D spending patterns, and additionally relies on a couple reasonable assumptions.

What have we found? In short, the impacts of the House budget on the federal research enterprise could be substantial, especially when coupled with the sequester. The budget could reduce total baseline spending in key budget accounts by 15 percent below the President's budget request, amounting to a three percent cut in total R&D from FY 2012 and a five percent cut in nondefense R&D, without accounting for the sequestration. Factoring in these additional cuts, the House budget could yield reductions in total R&D of up to 12 percent below the current year, with nondefense R&D receiving a disproportionate share of the cuts. Over the next decade, the House budget could reduce nondefense R&D by up to 27 percent, or $161 billion, below the President's request. Read more.

Download the Brief
FY 2013 Budget Resolution (House Budget Cmte)

House Budget Committee Releases FY 2013 Budget

House Budget Committee Chairman Paul Ryan has unveiled the GOP's proposed FY 2013 budget, which if passed would serve as a budget blueprint for the House. Ryan proposes an overall discretionary spending limit of $1.028 trillion in FY 2013 - $19 billion below the spending caps established in the Budget Control Act, but $97 billion above the reduced spending levels sought by some in the House. Even as the budget proposes an overall spending decline, it would seek to increase defense spending to $554 billion, $8 billion above the FY 2013 cap. Over the next ten years, the budget would lead to $352 billion less in discretionary spending than the President's budget. How R&D would fare in all this remains to be determined by appropriators.

The budget would also replace the first year of the automatic sequester. The sequester currently calls for approximately $98 billion in additional cuts to discretionary spending in FY 2013, $55 billion of which would come from defense. The House budget would roll back these cuts, and instead would task six House committees - including Energy & Commerce and Agriculture - with finding additional cuts from "low-priority" spending, which could potentially include R&D. The additional cuts would equal approximately $18.5 billion in FY 2013 and $261 billion cumulatively over the next ten years. These savings would be enacted via a process known as reconciliation, which allows for expedited consideration of legislation to change spending and revenues, but would require Senate agreement.

Meanwhile, at the same time Ryan was releasing his committee's budget, Senate Democrats announced they would officially establish their own spending level of $1.047 trillion, reflecting the caps agreed upon in the Budget Control Act. The House Budget Committee is expected to vote on the Ryan budget Wednesday.

FY 2013 Budget Resolution
Budget Control Act of 2011 (P.L.112-25)

Research and Development in the President's Budget

According to AAAS analysis of data from the Office of Management and Budget and individual agencies, federal R&D investment would rise to $142.2 billion under the President's FY 2013 budget request. This would represent $1.7 billion increase, or 1.2%, above FY 2012 estimated funding levels, though less than the expected rate of inflation. Further, in constant dollars, the President's budget would leave federal R&D expenditures approximately 10% below the peak achieved in FY 2010.

The overall increase would largely be driven by gains in nondefense R&D, as defense R&D would decline by $1.5 billion, or 1.9%. Both basic and, especially, applied research would receive increases above FY 2012 levels, while development activities would be reduced by 1.7%; all three trends would represent a continuation of changes seen last year. Weapons development at the Department of Defense would continue to receive cuts, as would research.

In the nondefense realm, R&D at several agencies that fared well in last year's budget cycle - including the Department of Energy, NASA, NIST, and the National Science Foundation - would again receive increases under the President's budget to varying degrees. Conversely, NIH funding would fail to keep up with inflation for the second year in a row. The Department of Agriculture is subject to a mixed picture, with a flat overall R&D budget but increases in some key research-oriented offices and initiatives. See the below tables for further agency details.

Looking ahead to Congressional action, the funding picture remains murky. While many research agencies no doubt remain generally popular with appropriators, several specific components of the President's budget have been criticized for being too generous, or not generous enough. The constrained budget environment will likely force difficult funding choices, and appropriators will be keen to push agencies to explore efficiencies, eliminate waste and duplication, and find ways to further reduce spending.

Please note: the below data represent current estimates, and may undergo minor revision.

Aggregate Tables
R&D in the FY 2013 Budget by Agency
Defense and Nondefense R&D by Character of Work
Interagency R&D Initiatives

Agency Tables
Department of Defense Total R&D | R&D by Military Departments and Defense Agencies
DOD Basic Research | DOD Science and Technology

Health and Human Services | National Institutes of Health
Department of Energy
NASA
National Science Foundation
Department of Commerce
Department of Agriculture
Department of Transportation
Department of Homeland Security
Department of Veterans Affairs
Department of the Interior / USGS
Environmental Protection Agency

Selected Graphs
Trends in R&D by Agency | Trends in Nondefense R&D by Function
Federal R&D as a Percent of GDP | R&D as a Percent of Federal Outlays
R&D as a Percent of Discretionary Spending

The President's FY 2013 Budget Released

The Administration has released its FY 2013 budget request. The main budget documents are available here: http://www.whitehouse.gov/omb/budget. Visit agency budget pages (links provided in the schedule section below) for more detailed agency proposals.

The budget projects a $1.33 trillion deficit for 2012, but a $900 billion deficit for 2013. According to the Office of Management and Budget (OMB), the Administration is pledging roughly $141 billion for R&D overall. Defense research activities would experience continued cuts compared to FY 2012, while non-defense R&D would actually increase by 5% according to OMB. Other items of interest emerging early from the FY 2013 request:

• The Administration still supports doubling the budgets for the Department of Energy's Office of Science, the National Science Foundation, and the National Institute of Standards and Technology, all key agencies for the nation's science and innovation ecosystem, though the timing of this doubling is not clear. Congress also has shown strong support for these agencies, but appropriations in recent years have not achieved the sustained increases authorized by the COMPETES legislation.


• The R&D tax credit would be expanded and made permanent. The Administration issued a similar proposal in last year's budget.


• The National Institutes of Health would adopt "new grant management policies" to increase the number of new research grants while overall funding remains largely flat.


• The Administration continues to prioritize manufacturing innovation, proposing $2.2 billion for advanced manufacturing R&D.

We'll post further updates and analyses as they come available.

View the President's Budget Request
OMB Science and Innovation in the FY 2013 Budget Fact Sheet

Agency Budget Briefing Schedule FY 2013

Office of Science and Technology Policy

National Science Foundation

Department of Energy - NOTE NEW TIME

National Aeronautics and Space Administration

Department of Health and Human Services

Department of Agriculture

Department of Defense

U.S. Geological Survey

National Oceanic and Atmospheric Administration

National Institute of Standards and Technology

Administration Delays FY 2013 Budget Release by One Week

Earlier this week, the Office of Management and Budget (OMB) notified reporters that the President's proposed budget would be released on Monday, Feb. 13, one week after the Feb. 6 date required by law. The reason for the delay is not yet clear, but according to one unnamed source, the delay is to allow the Administration to "finalize technical and programmatic decisions" related to the budget. The release of last year's budget was also delayed by one week. Both the Chairman of the House Budget Committee and the ranking member of the Senate Budget Committee have criticized the decision.

NSF Releases Science & Engineering Indicators 2012

The National Science Foundation has released its biennial Science & Engineering Indicators report, which tracks data trends in global and domestic R&D funding, STEM education, the science workforce, and public attitudes on science and technology. The report, using data through 2009, finds that long-term growth in domestic R&D investment, while slowing considerably, nevertheless outpaced broader economic growth. The U.S. also maintained a substantial lead in global research investments, though its share of global R&D declined from 38 percent in 1999 to 31 percent in 2009. This slippage is primarily due to substantial acceleration of research investments in Asia, especially in China. Thanks to explosive growth of 20 percent per year, China now ranks second in research investment, recently surpassing Japan. The report finds continuing support by the American public for science and technology, but also notes some troubling trends for the U.S. high-tech sector in the global marketplace. Click below for more.

Download Science & Engineering Indicators 2012
Science & Engineering Indicators Digest
NSF Presentation Slides
Press Release

Appropriations Megabus Becomes Law, Finalizes R&D Expenditures for Remainder of FY 2012

Appropriations Megabus Becomes Law, Finalizes R&D Expenditures for Remainder of FY 2012 On Friday, December 23, the President signed into law the Consolidated Appropriations Act of 2012, the so-called “megabus” spending bill. With the Presidents’s signature, the FY 2012 appropriations process is now complete. The trillion-dollar compromise package incorporates the remaining nine individual spending bills in the following areas: Defense; Energy and Water; Interior and Environment; Homeland Security; Financial Services; Labor, HHS and Education; State and Foreign Operations; Military Construction and Veterans; and the Legislature. This marks the first time since 2009 that Congress and the President were able to enact every spending bill prior to the year’s end.

Based on initial AAAS analysis, total R&D spending for FY2012 stands at $142 billion, approximately $1.9 billion or 1.4% below FY2011 levels. The summary table is posted immediately below, and individual agency tables can be found under the subject headings that follow.

FY 2012 Consolidated Appropriations Act
AAAS Estimates of R&D in FY 2012 Congressional Action by Agency - Summary Table

Defense R&D in the Final FY2012 Appropriations Bill: Science and Technology Holds Steady, but Overall Investment Down

On balance, the FY 2012 spending package will yield moderate reductions in overall Defense research and development activities, with notable exceptions in basic and applied research. RDT&E funding stands at $72.9 billion, a 3.4 percent decrease from last year’s levels. Most of these cuts are the products of reductions in development, demonstration, and support activities. For instance, advanced technology and components development are each seeing cuts greater than 5 percent below FY 2011 levels. These cuts are partially offset by increases to basic and applied research, which combined will receive a $421 billion or 6.5 percent increase above FY 2011 levels. As a result, science and technology spending actually holds steady from last year in the aggregate, but the character changes. Among the services, Army sees the greatest reduction in RDT&E spending, at $927 million or 9.6 percent below FY 2011 levels, while Navy and Air Force hold nearly steady; conversely, Army sees the largest increase in science and technology activities, receiving $364 million or 16.8 percent more for basic and applied research and advanced technology development than in FY 2011, while Navy and Air Force see very small cuts. Defense-wide agencies will see the largest cuts of all, with FY 2012 funding reduced by $1.6 billion below FY 2011 levels. Lastly, note that university research partnerships will see a 10 percent increase in FY 2012.

Department of Defense Funding Table
Department of Defense Funding Table by Military Departments and Agencies
Department of Defense Basic Research Funding Table
Department of Defense S&T Funding Table
FY 2012 Consolidated Appropriations Act

Energy R&D in the FY 2012 Appropriations Bill: Boosts in Science, Renewables & Efficiency, ARPA-E, and Atomic Defense at the Expense of Fossil Energy

Amid the fierce debates that surround the nation’s energy policy, the FY 2012 Consolidated Appropriations Act actually increases R&D funding at the Department of Energy in some unexpected ways. For instance, while the Office of Energy Efficiency and Renewable Energy’s overall budget remains steady, the portion devoted to R&D will increase above FY 2011 levels by 36.7 percent, or $283 million. Conversely, fossil energy R&D will actually decrease in FY 2012 by $70 million, or 15.4 percent below FY 2011 levels. The Office of Science R&D is funded at $4.5 billion, representing a relatively moderate increase of $209 million or 4.9 percent. The Advanced Research Projects Agency-Energy has been the subject of substantial budgetary debate, but ended up receiving a $92 million or 53.1 percent increase above FY 2011 levels. The National Nuclear Security Administration also receives a moderately large R&D boost of $318 million or 8.3 percent, primarily through increases in nonproliferation research and naval reactors.

Department of Energy Funding Table
FY 2012 Consolidated Appropriations Act

Interior and Environment in FY 2012 Appropriations Bill: Moderately Large Increases for USGS, EPA

The Interior and Environment appropriations bill, passed as part of the FY 2012 Consolidated Appropriations Act,  is fairly generous in R&D funding for both the Department of the Interior – especially at the U.S. Geological Survey – and the Environmental Protection Agency. The USGS, which performs of bulk of Interior’s R&D work, will see a $54 million increase in research funding above FY 2011 levels, an 8.5 percent increase. The largest increases come through climate and land use change research, which will see a 19.3 percent increase, and core science systems, which will receive a 57.6 percent increase; water resources research will also see a moderate increase. Elsewhere at Interior, the Bureau of Ocean Energy Management, Regulation and Enforcement has officially been reorganized into two separate offices: the Bureau of Ocean Energy Management, and the Bureau of Safety and Environmental Enforcement. At EPA, research funding will see a moderate 1.9 percent increase, with FY 2012 funding reaching $568 million, even as the agency's total discretionary budget has declined. This increase is due to a small $14 million boost in EPA’s science and technology program, though a recent reorganization in subprogram structure makes more detailed comparisons difficult for now.

Department of Interior Funding Table
Environmental Protection Agency Funding Table
FY 2012 Consolidated Appropriations Act

Health and Human Services in the FY 2012 Spending Bill: NIH Holds Steady, New Translational Sciences Center Established

On the whole, the FY 2012 Consolidated Appropriations Act leaves the overall National Institutes of Health R&D budget fairly unchanged, with any additional appropriations offset by an across-the-board reduction in discretionary spending leaving the NIH R&D budget $56 million below last year's $30.2 billion budget. Most individual research centers received a one-third percent increase, but there are also some notable changes. In the final bill, Congress agreed to establish within NIH the National Center for Advancing Translational Sciences, an entity that will seek to “reengineer” the process by which new discoveries in fundamental science move from lab to clinic. The Senate had originally approved the proposed center in its version of the appropriations bill, but the House had not. Elsewhere at NIH, the National Institute of General Medical Sciences will also see a $396 million or 19.5 percent increase. Meanwhile, the Centers for Disease Control and the Food and Drug Administration see substantial cuts in R&D budgets of 11.4 percent and 28.5 percent, respectively.

Department of Health and Human Services Funding Table
National Institutes of Health Funding Table
FY 2012 Consolidated Appropriations Act

Homeland Security in the FY 2012 Approps Bill: Cuts Continue for Science and Technology

Continuing the trend from FY2010, Congress made marginal cuts to the DHS Science and Technology Directorate in the FY 2012 Consolidated Appropriations Act. Final FY 2012 funding stands at $533 million, 1.7 percent below FY 2011 levels and slightly more than half of the Administration’s request. Congress’s clearest break with the Administration is in funding support for the Directorate’s research, development and innovation function; the compromise bill provides $266 million, 59.7 percent less than the request. Congress also provided $177 million for lab facilities, 36.2 percent less than the request but a 26.1 percent increase from FY 2011. Elsewhere, the Office of Domestic Nuclear Detection also is subject to a $52 million or 15.1 percent cut below FY 2011 levels, primarily due to a $60 million or 21.8 percent cut to research, development and operations. FEMA is also facing a 40.7 percent cut of $2.9 billion below FY 2011 levels.

Department of Homeland Security Funding Table
FY 2012 Consolidated Appropriations Act

Appropriations Minibus Signed Into Law; Includes CR Through December 16

Three sets of appropriations including Agriculture, Rural Development and Food and Drug Administration; Commerce, Justice, and Science; and Transportation and Housing and Urban Development (HUD) were signed into law on Friday, November 18th as part of the first appropriations "minibus", the Consolidated and Further Continuing Appropriations Act, 2012 (H.R.2112). Details, including R&D estimates in the bills, are in separate headlines below. The bill includes a continuing resolution (CR) to extend funding for other agencies at FY 2011 levels through December 16. While the Senate was originally going to try to package the remaining appropriations bills into a series of minibuses each containing 3 appropriations bills, it now looks likely that the remaining nine bills will be compiled into a single omnibus bill.

Consolidated and Further Continuing Appropriations Act, 2012 (H.R.2112)

Transportation and HUD Appropriations Signed Into Law

The Transportation, Housing and Urban Development, and Related Agencies appropriations were signed into law on Friday, November 18th as part of the first appropriations "minibus", the Consolidated and Further Continuing Appropriations Act, 2012 (H.R.2112). The bill provides $72.3 billion for the Department of Transportation (DOT), rejecting most of the Administration's proposed initiatives which would have brought the DOT budget to a total of $129.4 billion. The FY 2012 funding level is, however, an increase over the FY 2011 by $3.6 billion (5.2 percent). The R&D investment in the bill is estimated at $1.1 billion, $137 million (11.3 percent) less than the President's request, but $64 million (6.4 percent) more than last year. The biggest decreases from last year come in the Federal Transit Administration which saw its Research and University Research Centers budget line get cut by $15 million (25.2 percent) and in the Federal Aviation Administration which suffered cuts in its Facilities and Equipment account for R&D projects, particularly in NextGen: System Development.

Department of Transportation Funding Table
Consolidated and Further Continuing Appropriations Act, 2012 (H.R.2112)
House Transportation, and Housing and Urban Development Draft Appropriations Bill
Transportation, Housing and Urban Development, and Related Agencies Appropriations Act, 2012 (S.1596)

Final Agriculture Appropriations Signed Into Law

The Agriculture, Rural Development, Food and Drug Administration, and Related Agencies appropriations were signed into law on Friday, November 18th as part of the first appropriations "minibus", the Consolidated and Further Continuing Appropriations Act, 2012 (H.R.2112). The bill provides $17.5 billion in discretionary spending for the U.S. Department of Agriculture (USDA) which is $72 million (0.4 percent) less than FY 2011 and $1.8 billion (9.4 percent) less than the President's request. The projected USDA R&D investment in the bill is $1.9 billion, $120 million (6.0 percent) less than last year and $136 million (6.7 percent) less than the request. The Agricultural Research Service, the USDA's intramural funding program, is funded at $1.1 billion, a $39 million (3.4 percent) cut in total budget from FY 2011 while the National Institute for Food and Agriculture (NIFA), the USDA's extramural funding program, received $1.2 billion, a $13 million (1.0 percent) cut from last year. The Agriculture and Food Research Initiative (AFRI), NIFA's competitive funding program which has seen gains in recent years and was slated for an increase in the President's request, was flat funded at $264 million. The House bill had included a prohibition on funding the implementation of the June 3rd USDA departmental regulation on climate change adaptation, but the conference report does not contain that provision.

While the majority of USDA funding was settled in the "minibus," one remaining agency -- the Forest Service -- had to wait for passage of the FY 2012 Consolidated Appropriations Act (H.R. 2055), signed into law on December 23. R&D at the Forest Service was cut by $7 million below FY 2011 levels, a 2.1 percent reduction, but $3 million higher than the Administration's request.

U.S. Department of Agriculture Funding Table
Federal Food, Nutrition, Agriculture, and Natural Resource Sciences Funding Update
Consolidated and Further Continuing Appropriations Act, 2012 (H.R.2112)

Commerce, Justice, and Science Appropriations Signed Into Law

Commerce, Justice, Science, and Related Agencies appropriations were signed into law on Friday, November 18th as part of the first appropriations "minibus", the Consolidated and Further Continuing Appropriations Act, 2012 (H.R.2112). The House version of the bill is the Commerce, Justice, Science, and Related Agencies Appropriations Act, 2012 (H.R.2596) and the Senate version is the Commerce, Justice, Science, and Related Agencies Appropriations Act, 2012 (S.1572). The conference report funded two of science agencies at levels greater than either the of the original House or Senate levels, implying some support for investment in science and technology despite the current tough budget climate. The National Science Foundation was one of those agencies, receiving $7.0 billion in the bill, $173 million (2.5 percent) more than in FY 2011. But this funding level is still well short of the President's request of $7.8 billion which would have been consistent with his budget doubling plan for the agency. The other agency receiving a higher funding level than in the original House or Senate bills was the National Institute of Standards and Technology (NIST). NIST is funded at $751 million for FY 2012, a $1 million (0.1 percent) increase from last year. However, the conference report fails to fund all but one of the Industrial Technology Services (ITS) programs. Funding was eliminated for the Advanced Manufacturing Technology Consortium, the Baldrige Performance Excellence Program and the Technology Innovation Program. The sole surviving program in ITS is the Hollings Manufacturing Extension Partnership. The National Aeronautic and Space Administration (NASA) received $17.8 billion in the bill, a $648 million (3.5 percent) decrease from last year. The House bill had eliminated funding for the James Web Space Telescope, but the conference sided with the Senate and funded the project at $530 million. The National Oceanic and Atmospheric Administration fared the least well in the bill with an estimated R&D investment of $620 million for FY 2012, $28 million (4.3 percent) less than in FY 2011 and $116 million (15.8 percent) less than the President's request. The administration had proposed the establishment of a National Climate Service, and while the proposal was supported by the Senate, the conference sided with the House and did not fund the new line office.

Department of Commerce Funding Table
National Aeronautics and Space Administration Funding Table
National Science Foundation Funding Table
Consolidated and Further Continuing Appropriations Act, 2012 (H.R.2112)
Commerce, Justice, Science, and Related Agencies Appropriations Act, 2012 (H.R.2596)
Commerce, Justice, Science, and Related Agencies Appropriations Act, 2012 (S.1572)

Senate Appropriations Committee Approves 302(b) Subcommittee Allocations

The full Senate Appropriations Committee approved their 302(b) subcommittee allocations on September 7. The House approved their 302(b) subcommittee allocations back in May. The 302(b) subcommittee allocations provide a framework for the total discretionary budget that each appropriations subcommittee may allocate for federal departments and agencies under its jurisdiction. The total Senate budget authority comes to $1.043 trillion, a $23.3 billion increase over the House 302(b) allocations. Under the Senate Appropriation's plan, the Labor-HHS Subcommittee which has oversight of the National Institutes of Health (NIH), would have an additional $17.9 billion to spend; Commerce-Justice-Science, with jurisdiction over the National Science Foundation (NSF), the National Aeronautics and Space Administration (NASA), the National Oceanic and Atmospheric Administration (NOAA), and the National Institute of Standards and Technology (NIST), would have an additional $2.5 billion; and Energy and Water Development would have an additional $986 million.

Funding by Congressional Appropriations Subcommittee

OMB Releases FY 2013 Budget Guidance

OMB Director Jacob Lew sent a memo to department and agency heads dated August 17 providing guidance on the preparation of their FY 2013 budget requests given the enactment of the Budget Control Act of 2011. The memo directs agencies to submit FY 2013 budget requests totalling at least 5 percent below their FY 2011 enacted discretionary appropriation and to identify additional reductions that would bring the total request to at least 10 percent below their FY 2011 enacted discretionary appropriation. In addition, the memo asks agencies to identify programs to "double down" on that provide the "best opportunity to enhance economic growth".

Fiscal Year 2013 Budget Guidance
Budget Control Act of 2011 (P.L.112-25)

12 Member Joint Select Committee on Deficit Reduction Set

House and Senate leaders have chosen their representatives to serve on the bipartisan Joint Select Committee on Deficit Reduction which has been charged to find at least $1.2 trillion in savings over ten years to avoid automatic spending cuts. Each member's name links back to his/her official Congressional website.

House and Senate Pass Veterans Affairs Appropriations Bill

The House passed the Military Construction and Veterans Affairs and Related Agencies Appropriations Act, 2012 (H.R.2055) on June 14 and the Senate passed an amended version on July 20. The House bill provides $531 million for the Medical and Prosthetic Research program at the Department of Veterans Affairs (VA). This funding level is $22 million (4.3 percent) more than the President's request and $49 million (8.4 percent) less than in FY 2011. The Senate version of the bill provides $581 million for the Medical and Prosthetic Research program which is $72 million (14.2 percent) more than the President's request and $1 million (0.2 percent) more than FY 2011. Including research support from other VA programs, the total R&D investment in the Senate bill is estimated at $1.16 billion, $144 million (14.2 percent) more than the President's request and $2 million (0.2 percent) more than FY 2011 while the House bill's R&D investment estimate is $1.06 billion, $44 million (4.3 percent) more than the President's request and $98 million (8.4 percent) less than FY 2011. VA also performs R&D for other federal agencies and non-federal organizations which is estimated at $720 million for FY 2012. Adding this non-VA funded R&D brings the total for VA-performed R&D to $1.87 billion in the Senate bill and $1.77 billion in the House bill.

Veterans Affairs Funding Table
Military Construction and Veterans Affairs and Related Agencies Appropriations Act, 2012 (H.R.2055)

R&D in the FY 2011 Year-long Continuing Resolution

Total R&D investment in the FY 2011 full-year continuing resolution is estimated at $144.4 billion, a 3.5 percent ($5.2 billion) cut from FY 2010. However, $4.7 billion of that cut comes from the Department of Defense appropriations bill that was included in the year-long continuing resolution. Non-defense R&D received cuts of just 0.9 percent with increases at the National Aeronautics and Space Administration (+$605 million to $9.9 billion) and the Centers for Medicare and Medicaid Services (+$507 million to $543 million) balancing out the largest decreases at the U.S. Department of Agriculture (-$501 million to $2.1 billion), the Department of Energy's energy programs (-$357 million to $2.1 billion), the National Institutes of Health (-$329 million to $30.2 billion), and the Department of Homeland Security (-$175 million to $712 million).

Table. R&D by Agency and Character of Work

AAAS Report XXXVI: Research and Development FY 2012

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R&D in the FY 2011 Compromise

Congress released their year-long continuing resolution for FY 2011 this morning which contains a total of around $38.5 billion in cuts, the largest collection of spending cuts in history. R&D intensive programs and agencies were spared the worst of the cuts. Basic research programs faired the best, while applied research programs, especially at the Department of Energy did less well, accurately reflecting the current policy debates taking place. Basic research generally has broad, bi-partisan support, but there is discussion as to how much the federal government should be involved in applied research and the role of industry in funding the applied research stage of the innovation pipeline.

The National Institutes of Health are funded at $30.7 billion in the continuing resolution, a 0.8 percent ($260 million) cut from current FY 2010 spending levels. The National Science Foundation is funded at $6.8 billion, a 1.0 percent ($67 million) cut from current levels. The Department of Energy's Office of Science will receive $4.9 billion, a 0.4 percent ($20 million) cut from current levels while the applied reseach-oriented Energy Efficiency and Renewable Energy (EERE) program would receive $1.8 billion, a 18.4 percent ($408 million) cut from current levels. By comparison, the EERE program had been slated for a budget of $1.5 billion in the original H.R. 1, a 35.0 percent ($775 million) cut. ARPA-E received $180 million in the continuing resolution. These funding levels to not include the 0.2 percent across the board cut for non-defense agencies. More details and analysis will be posted as it is available.

House Appropriations Committee Press Release and Bill Text
Senate Appropriations Committee and Subcommittees' Summaries

R&D in the FY 2011 and FY 2012 Budgets

The Senate Appropriations Committee released their Full-Year CR proposal on Friday. The total amount of discretionary spending in the bill, $1.079 trillion, splits the difference between the President's FY 2011 request ($51 billion lower) and the House year-long CR proposal, H.R.1 ($51 billion higher). See the table below for more details.

Senate Full-Year CR
H.R.1 - Full-Year Continuing Appropriations Act, 2011
Table. R&D in the FY 2011 and FY 2012 Budgets

President's FY 2012 Budget Compared to House CR (H.R.1)

The President's FY 2012 budget request, released today, contains $147.9 billion in R&D investment, a $772 million (0.5%) increase from FY 2010. While the overall R&D budget is essentually flat, the President funds priority areas such as clean energy R&D, education, infrastructure, and innovation, and keeps the National Science Foundation, the Department of Energy's Office of Science, and the National Institute of Standards and Technology on their multi-year doubling path. The FY 2012 Budget Request, however, differs greatly from the recently introduced continuing resolution (CR), H.R.1, which represents the House Republican leadership's plan for $100 billion in discretionary spending cuts. Overall, the FY 2012 request totals $7.4 billion more (12.5%) non-defense R&D investment than the CR. Some of the bigger discrepancies are in funding for energy R&D, the National Institutes of Health, and the National Science Foundation. See the table below for more details.

H.R.1 - Full-Year Continuing Appropriations Act, 2011
Updated 2/15 - Table. R&D in the FY 2011 and FY 2012 Budgets

House Republicans Propose CR for Remainder of Fiscal Year

House Majority Leader Eric Cantor (R-VA) has announced that House Republicans plan to bring to the floor the week of February 14 a continuing resolution (CR) that would cover government funding through the end of FY 2011 (that is, through September 30, 2011). No specific budget figures have been released, but it is expected that the proposed CR would reduce spending to FY 2008 levels as passed in last week’s House resolution (H.Res.38). Additionally, House Appropriations Committee Chairman Harold Rogers (R-KY) said during debate on that resolution that the CR would "make the largest series of spending cuts in history." These actions would coincide with the anticipated release of President Obama’s FY 2012 budget proposal.

H.Res.38 - Reducing non-security spending to fiscal year 2008 levels or less

Biennial Budget Appropriations Acts Introduced

Sens. Johnny Isakson (R-GA) and Jeanne Shaheen (D-NH) have introduced the Biennial Budget Appropriations Act (S.211), which would switch the annual federal budget process to a two-year cycle, with the first year dedicated to appropriations and the second year dedicated to oversight of federal programs. Reps. David Dreier (R-CA) and Ed Whitfield (R-KY) are sponsoring a similar bill, the Biennial Budgeting and Appropriations Act (H.R.114) in the House. Nineteen states have biennial budget cycles. These proposals respond in part to the increased difficulty of completing the federal budget on time. Congress has done that only twice since 1980.

S.211 - Biennial Budget Appropriations Act
H.R.114 - Biennial Budgeting and Appropriations Act ()

R&D Tax Credit Tied to Domestic Production Proposed

Senator Herb Kohl (D-WI) announced plans last week to introduce a bill, the Domestic Jobs Innovation Bonus Act, that would increase the existing R&D tax credit for companies that produce goods domestically. The increase would range from 2% for companies with 50-60% of sales from domestically-produced goods, up to a 10% increase for companies with 90%-100% of sales from domestically-produced goods. President Obama released his plan, which was not tied to domestic production, for an increased and permanent R&D tax credit in September of last year.

Domestic Jobs Innovation Bonus Act - Sen. Kohl
Expanded, Simplified and Permanent Research and Experimentation Tax Credit - Pres. Obama

Detailed Proposals on How to Cut the Discretionary Budget Emerge

On January 7, Rep. Kevin Brady (R-TX) introduced The CUTS Act of 2011 (H.R.235) which includes $154 billion in discretionary budget cuts. The list of programs borrows heavily from the National Commission on Fiscal Responsibility and Reform's list of illustrative savings released in November of last year, but also includes terminations suggested by the Obama and the previous Bush administrations. R&D programs listed in The CUTS Act include the same four programs named in the fiscal commission's list:

1. Eliminate Hollings Manufacturing and Baldride National Quality Programs ($120 million);
2. Cut research funding for fossil fuel ($900 million);
3. Eliminate funding to the private sector for spaceflight development ($1.2 billion); and
4. Reduce Research, Development, Test & Evaluation (RDT&E) at the Department of Defense by 10 percent ($7.0 billion).

Taxpayers for Common Sense, a non-partisan budget watchdog organization, released their own set of recommended cuts for the 112th Congress on January 11. Their cuts tally $148 billion over the next five years with just six of their recommended cuts totaling over $100 billion in savings. The list focuses on tax breaks and individual projects, many of them infrastructure-related. Two R&D programs are included in their list:

1. Department of Defense development projects ($12 billion, not exclusively R&D); and
2. Ultra-deepwater and unconventional natural gas and other petroleum resources R&D ($200 million).

The Republican Study Committee (RSC) released details of The Spending Reduction Act of 2010 on January 20. The Act calls for holding FY 2011 non-security discretionary spending at FY 2008 levels and holding FY 2012 - FY 2021 non-defense discretionary spending at FY 2006 levels, with no allowance for inflation. The Act details $330 billion in program cuts and eliminations over the next ten years as part of the overall spending reductions. Three R&D related programs are included in this list of eliminations and reductions:

1. Technology Innovation Program (TIP) at the National Institute of Standards and Technology (NIST; $70 million annually);
2. Manufacturing Extension Partnership (MEP) at NIST ($125 million annually); and
3. Unspecified reductions in applied research at the Department of Energy ($1.27 billion annually).

Sens. Bob Corker (R-TN) and Claire McCaskill (D-MO) introduced the Commitment to American Prosperity Act, the CAP Act, on February 1 which would enact a 10-year plan starting in FY 2013 to decrease mandatory and discretionary spending from the current level of 24.7% of gross domestic product (GDP) to 20.6% of GDP, the 40-year historical average. The bill includes authorization for the Office of Management and Budget (OMB) to make evenly distributed cuts throughout the budget each year to bring the budget down to the prescribed level. It would take a two-thirds vote in both chambers to override the spending cap. The bill contains no specific guidance on individual programs.

H.R.235 - The CUTS Act of 2011
National Commission on Fiscal Responsibility and Reform's $200 Billion in Illustrative Savings
Taxpayers for Common Sense: Recommended Cuts for the 112th Congress
The Spending Reduction Act of 2010
The Commitment to American Prosperity Act - The CAP Act

Secretary Gates Announces $178 Billion in Cuts and Reinvestment

Defense Secretary Robert Gates announced $178 billion in program cuts over the next five years in a speech on January 6 as part of the Defense Efficiences Initiative started in May 2010. Of the $178 billion, $100 billion will be reinvested in higher-priority programs and $78 billion will go towards deficit reduction. Most of the cuts deal with personnel, operations and procurement and appear to have limited effect on Research, Development, Test and Evaluation (RDT&E) programs, especially those operating in the Basic Research (6.1) through Advanced Technology Development (6.3) budget classifications. However, of the programs receiving new or increased spending named in the speech, a number appear to have RDT&E components including new electronic jammers, modernization of F-15 radars, new sea-borne unmanned strike and surveillance aircraft, and a new long-range nuclear-capable penetrating bomber, making this announcement look favorable for R&D investment at the Department of Defense.

Robert Gates January 6 Speech: Statement on Department Budget and Efficiencies
Defense Efficiences Initiative

House Sets New Budget Rules

The House adopted their new rules (H.Res.5) for the Republican majority on January 5 after electing Rep. John Boehner (R-OH) to be the Speaker of the House for the 112th Congress. Some of the newly adopted rules have directly affect the budget process. First, the pay-as-you-go (PAYGO) rule as established by the 110th Congress was replaced with a cut-as-you-go rule which requires new mandatory spending to be offset with cuts to existing programs and does not allow new spending to be offset with increased revenues as in the previous PAYGO rules. Since the new rule only pertains to spending, tax cuts or other revenue decreases are not covered by cut-as-you-go and do not need to be offset. Extension of the 2001 and 2003 tax cuts, the repeal of the Patient Protection and Affordable Care Act, and other Republican priorities are explicitly exempted from the cut-as-you-go rule. Second, the chair of the House Budget Committee, Paul Ryan (R-WI), is given expanded power under the new rules to establish overall budget spending limits for FY 2011 - 2015 without a committee vote. Previously, these limits, known as the 302(a) allocations, were approved by the Budget Committee and voted on by the full House as part of the yearly budget resolution.

H.Res.5 - Adopting rules for the One Hundred Twelfth Congress

FY 2012 Budget Request Delayed

The National Journal has reported that the Administration's FY 2012 budget request is likely to be postponed until February 14 rather than being released on the traditional first Monday in February. The reason for the delay is the recent appointment of the new OMB director Jacob Lew, whose Senate confirmation was delayed due to a hold by Sen. Mary Landrieu (D-LA). The Administration has not yet made any official announcement about a release date for the budget request.

President Obama Signs America COMPETES Reauthorization Act

As part of a flurry of Congressional activity at the end of the lame-duck session, Congress passed the America COMPETES Reauthorization Act of 2010 (H.R.5116). President Obama then signed the bill into law on January 4, 2011. The scope of the final bill was scaled down from the original House bill passed at the end of May to ease its passage in the lame-duck session, but it still contains a significant amount of policy guidance relating to innovation, workforce development, and education. The bill also reaffirms the 10-year budget doubling track of the Department of Energy's Office of Science, the National Institute of Standards and Technology, and the National Science Foundation.

H.R.5116 - America COMPETES Reauthorization Act of 2010
America COMPETES Aurthorization Tables and Charts
AIP FYI #3: America COMPETES Reauthorization Bill Signed Into Law

President Signs FY 2011 Defense Authorization

Congress passed the Ike Skelton National Defense Authorization Act for Fiscal Year 2011 (H.R.6523) in the final days of the lame-duck session and President Obama signed the bill on January 7, 2011. The bill is similar to the Defense authorization bill that passed the House (H.R.5136) back in May with some controversial provisions removed to expedite its passage. The bill authorizes $10.1 billion for Army Research, Development, Test, and Evaluation (RDT&E), $17.9 billion for Navy RDT&E, $27.3 billion for Air Force RDT&E, and $21.3 billion for Defense-wide RDT&E for a total of $76.6 billion, just short of the $76.8 billion in the President's FY 2011 budget request.

H.R.6523 - Ike Skelton National Defense Authorization Act for Fiscal Year 2011

R&D Tax Credit Extended Through End of 2011

The research and experimentation tax credit was extended to December 31, 2011 as part of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (H.R.4853). The President has proposed a permanent and increased tax credit, but that will have to wait until the next Congress.

H.R.4853 - Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010
White House Fact Sheet: Expanded, Simplified and Permanent Research and Experimentation Tax Credit

Fourth Short-term CR of FY 2011 Passed

Congress passed the Continuing Appropriations and Surface Transportation Extensions Act, 2011 (H.R.3082) on December 21, just hours before the third continuing resolution (CR) of the FY 2011 appropriations cycle expired. The FY 2011 appropriations cycle has been particularly dynamic with the House passing an over 150 page year-long CR earlier in December only to have it replaced by a nearly 2000-page omnibus bill in the Senate which was pulled from consideration during floor debate when Republican support for the bill evaporated after an intense lobbying effort by Senate Minority Leader Mitch McConnell (R-KY) to his Republican colleagues. A short-term extension of federal funding at FY 2010 levels sets up a face-off in the new Congress between the newly elected House Republican majority which is pushing for $50-60 billion in discretionary cuts and the Democrat-led Senate early in 2011.

H.R.3082 - Continuing Appropriations and Surface Transportation Extensions Act, 2011

Appropriations Update: Omnibus Pulled From Senate Floor After Support Evaporates

While passage of the omnibus seemed likely as it was brought to the Senate floor for debate last night, the required Republican support evaporated and Senate Majority Leader Harry Reid (D-NV) pulled the bill from consideration without a vote. The House has passed a year-long continuing resolution (CR), but instead of taking up that bill, Sen. Reid has indicated that he will bring a short-term CR introduced by Senator Minority Leader Mitch McConnell (R-KY) to the floor to fund the government through February 18. The House will then have to quickly pass that short-term CR and send it to the President to avoid a government shutdown at midnight on Saturday.

Update on Federal R&D Funding Outlook:
Government Shutdown?

While Sen. Inouye (D-HI), chair of the Senate Appropriations Committee, remains confident that he has at least the 60 votes required to pass the omnibus appropriations bill released on Tuesday, some Republican Senators are threatening to call for the reading of the nearly 2000 page bill. It is estimated that the reading would last through Saturday, setting up a cloture vote for Monday, and delaying final passage until Tuesday after the required debate time. With the current continuing resolution (CR) expiring on Saturday, December 18 at midnight and no plan to enact another short term CR, that leaves a couple days without government funding at the beginning of next week, resulting in a shutdown.

The House passed a year-long continuing resolution (CR) last week, putting the ball in the Senate's court for further action on FY 2011 appropriations. However, the path forward for appropriations became more uncertain with the emergence of a third option for appropriations in the lame duck session: a short-term CR through February. This means the three options for FY 2011 appropriations currently are (1) a year-long CR, funding the government at FY 2010 levels (with some exceptions for certain programs), (2) an omnibus bill which would combine all twelve regular appropriations bill into one, and (3) a short term CR through February. The first option, a year-long CR has passed the House and includes $1.086 trillion in funding for FY 2011 (see article below for details). The Senate Democrats, lead by Sen. Inouye, are expected to try to replace the CR with an omnibus bill that totals $1.108 trillion, the level requested by Senate Republicans earlier this year. It is becoming more likely that the omnibus has the support to pass the Senate with at least two Republicans, Sens. Robert Bennett (R-UT) and Christopher Bond (R-MO), voicing their support as long as the omnibus spending total stays below the $1.108 trillion level. However, their are a few Democrats who are still on the fence, including Sens. Bill Nelson (D-FL) and Jim Webb (D-VA) which means that the omnibus may need more than just two Republicans to vote for it. The newly announced third option, a short-term CR through February, has the support of a number of fiscally conservative Senate Republicans who hope to revisit appropriations in the new Congress, after the Republicans have a majority in the House and have narrowed the partisan gap in the Senate. While this option is quickly gaining support in Republican circles, its looks unlikely that it will gain the 60 votes to pass as many legislators want to finish up appropriations sooner, rather than later.

Since the election, it has become clear that a number of Congressional Republicans have decided to support relatively quick action on FY 2011 appropriations and focus on FY 2012 for the majority of their proposed budget cuts. The Senate Republican caucus passed a resolution to reduce FY 2012 non-security discretionary spending levels to inflation-adjusted FY 2008 levels along with an earmark ban for the next Congress. However, an effort to enact that earmark ban in the full Senate failed a vote (39-56) with eight Republicans voting against the earmark ban and seven Democrats voting for it.

House Passes Year-Long CR With Over 150 Pages of Adjustments

The House passed a year-long continuing resolution (CR) last night by just 6 votes, sending the bill to the Senate. The bill, H.R.3082, also includes the Surface Transportation Extension bill, the Airport and Airway Extension bill and the Food Safety bill. The CR extends federal funding through the end of FY 2011, September 30, 2011, at FY 2010 levels, but includes over 150 pages of "anomalies", or funding adjustments. A summary and bill text can be found at the House Appropriations Committee website. The majority of R&D programs look to be funded at FY 2010 levels, but some adjustments include the National Aeronautics and Space Administration (NASA) to appropriate funding consistent with the newly passed NASA reauthorization bill and the Department of Energy (DOE) is allowed to transfer up to $300 million to ARPA-E from Energy Efficiency and Renewable Energy (EERE) or the Office of Science. More details will follow.

H.R.3082 - Full-Year Continuing Appropriations Act, 2011 (Thomas)
2011 Full Year Funding Resolution (House Appropriations Website)

Recommendations to Reduce the National Debt:
What Do They Mean For R&D Funding?

The President's National Commission on Fiscal Responsibility and Reform failed to get the required 14 votes to force a Senate vote on its fiscal plan, but 11 of the 18 commission members, a majority, did express their support for the final report, far more than many anticipated. The 66-page report titled, The Moment of Truth, recommends a combination of tax restructuring, discretionary spending cuts, and adjustments to mandatory programs to save nearly $4 trillion through 2020 and reduce the yearly federal deficit to 2.3% of Gross Domestic Product (GDP) by 2015, exceeding the President's goal of 3% of GDP.

While the President's debt commission report may be the most widely publicized set of recommendations to reduce the national debt, a number of other fiscal plans to curb the federal deficit have been released previously and many of these plans contain similar recommendations. The Committee for a Responsible Federal Budget, a bipartisan, non-profit organization has compiled a comparison table highlighting many of the recommendations contained within the various reports, but what do all these recommendations mean for the federal R&D enterprise?

Below is a non-exhaustive list of some of recommendations made in at least one of the reports that would affect federal R&D:

Invest in high-value research. [NCFRR, p.12] [Obama, 23:00]
One of the President's debt commission's guiding principles was to "cut and invest to promote economic growth and keep America competitive", and investment in "education, infrastructure, and high-value research and development" was recommended. While investment with the hope of future returns can be especially difficult during tight budgets, there is broad evidence of the important role of scientific and technological advancement in the overall economic growth. Robert M. Solow was awarded the Nobel Prize in Economic Studies in 1987 for his work on the exogenous growth model, also known as the Solow-Swan growth model. Solow's seminal 1957 paper showed that productivity growth through technological change accounted for over 80% of U.S. economic growth in the first half of the 20th century. Studies since then have shown that technological change has played a similar role since WWII in the U.S. and other developed economies. Not only is technological growth important to the overall economy, but a 1991 study by Edwin Mansfield showed that investment in academic scientific research yields a 28 percent return on investment (ROI) over time. The National Research Council report, Rising Above the Gathering Storm (p.48-49), provides a thorough overview of other studies that show generous ROI on research and development in both the private and public sectors. The importance of R&D investment to drive economic growth and the high ROI on R&D investment warrants making R&D investment a priority, even during tight budgets.

Click to Enlarge

Discretionary Budget Cuts / Freezes. [APTA, p.19] [BPC, p.86] [CRFB, p.8] [NCFRR, p.20] [OMB1]
Almost all of the fiscal plans recommend some level of discretionary funding decreases or funding freezes. Over 95% of federal R&D funding is discretionary, therefore cuts in discretionary funding potentially have a large effect on R&D funding. Additionally, the overall level of R&D spending is historically highly correlated with overall discretionary spending, with R&D spending consistently making up an average of 12.0% (+/- 1.9%) of the total discretionary budget since 1969 when the large investment in the Apollo program wound down (see chart).

Roll Back Discretionary Funding to a Previous Fiscal Year. [APTA, p.21] [NCFRR, p.20]
Discretionary funding cuts can have increased negative impact on the R&D enterprise when using an historical year as the reference baseline for funding. Many R&D priorities are funded through relatively short-term initiatives, typically in a ramp-up / ramp-down paradigm that increases funding during a startup phase, sustains funding through a number of years, and then decreases funding while the project comes to an end. Large infrastructure projects such as the Ocean Observatories Initiative (OOI) at the National Science Foundation (NSF), interagency projects such as the Joint Polar Satellite System (JPSS), and targeted R&D initiatives such as smart grid investments at the Department of Energy are examples of these types of R&D initiatives. Resetting budgets to previous years interrupts this funding cycle, and because R&D priorities shift between agency departments and divisions, simply falling back to previous agency department or division funding levels can stifle funding for important national priorities. Instead, discretionary cuts should be based on a percentage of funding in the current fiscal year so that priorities can be better managed during tight budgets and the effect on high-priority initiatives can be minimized.

Targeted Cutbacks. [BPC, p.132] [CRFB, p.8] [NCFRR, Addendum] [OMB2]
A number of the debt commission reports included a list of suggested or recommended cutbacks to current programs. While cutbacks in R&D programs jeopardize future growth due to the importance of technological advancement in economic growth as mentioned previously, it is acknowledged that all government programs should be subject to regular review for effectiveness and their contribution to national priorities. Targeted program cuts, when properly reviewed, are an effective way to enforce fiscal discipline while supporting national priorities and preventing budget cuts from impacting high-performing programs.

Switch to biennial budgeting. [BPC, p.122] [NCFRR, Co-chair Proposal]
Biennial budgeting, where Congress enacts a two-year budget every other year, would provide more stable guidance to agencies when planning future investments. The current one-year fiscal cycle makes it difficult for agencies to plan future investment due to the volatile nature of Congressional Action on the yearly appropriation bills. In addition, with many budgets getting delayed well into the fiscal year, agencies are challenged to enact new priorities in the shortened fiscal year. Future investment planning is further hindered by budget request deadlines that occur before the current budget is even approved. R&D investment is especially susceptible to funding instability since, as mentioned before, many R&D initiatives are multi-year and function best in a ramp-up / ramp-down funding paradigm. The co-chairs of the President's debt commission originally included biennial budgeting as a recommendation, but it was removed in the final report. The Bipartisan Policy Center's Debt Reduction Task Force also recommended a move to biennial budgeting.

[APTA] A Pledge to America, The 2010 Republican Agenda
[BPC] Restoring America's Future, Bipartisan Policy Center
[CRFB] The Future is Now: A Plan to Stabilize Public Debt and Promote Economic Growth, The Committee for a Responsible Federal Budget
[NCFRR] The Moment of Truth, National Commission on Fiscal Responsibility and Reform
[Obama] President Obama's November 3rd Press Conference
[OMB1] OMB Memo: Fiscal Year 2012 Budget Guidance
[OMB2] OMB Memo: Identifying Low-Priority Agency Programs

Fiscal Commission Co-Chairs Release Preliminary Proposal

On November 10, the co-chairs of the National Commission on Fiscal Responsibility and Reform, Alan Simpson, former Senator from Wyoming, and Erskine Bowles, former Chief of Staff to President Clinton, released a proposal to reduce the deficit below the 3 percent of gross domestic product (GDP) by 2015 goal set by President Obama. The proposal includes a number of spending cuts to both discretionary and mandatory programs along with 3 options for major tax reform, all of which would increase the tax burden by $80 billion a year by 2015. The proposal included a list of $200 billion in illustrative savings which included a number of R&D-related programs. Some of the R&D-related cuts are reducing the Department of Defense's Research, Development, Test & Evaluation (RDT&E) program budget by 10% ($7 billion in FY 2015), eliminating the Hollings Manufacturing Extension Partnership, eliminating all earmarks, cutting fossil fuel research, eliminating private sector funding for spaceflight, and reducing Smithsonian and National Park Service funding.

National Commission on Fiscal Responsibility and Reform Co-Chair Proposal
AIP FYI #113: Proposal by Co-Chairs of the National Commission on Fiscal Responsibility and Reform...

- posted November 12, 2010

Post-Election Outlook on Federal R&D Funding

While reining in the deficit is a priority for both Democrats and Republicans, both parties have different plans on how to do so. However, both parties agree that reduced government spending will be part of that plan, and with that reduced government spending, federal support for R&D will likely be subject to some of the cost-cutting measures.

As reported previously, the Obama administration, through Office of Management and Budget memos, directed non-security agencies to submit FY 2012 budget proposals that (1) totaled 5% less than FY 2012 budget estimates in their FY 2011 budget submissions and that (2) included a list of low-impact programs totaling an additional 5% of the agency's discretionary budget. It's possible that some portion of low-impact program budget cuts will be reinvested elsewhere within the agency, so for non-security agencies, we can expect discretionary budget cuts of between 5 - 10 percent from previous FY 2012 estimates. It is important to note that because the cuts are based on previous FY 2012 estimates, some agencies, such as those authorized in the America COMPETES Act, could still see increases for FY 2012 although those increases would be reduced by 5% from previous estimates. However, while overall budget cuts are imminent, President Obama, in a November 3rd press conference (23:00), said "I don't think we should be cutting back on research and development," so it's likely that his budget request will spare R&D from the same 5 - 10 percent budget cuts to which the overall discretionary budget will be subjected.

The 2010 Republican Agenda, A Pledge to America, contains a pair of policy positions which could have a significant impact on federal R&D investment. First, cutting government spending to pre-stimulus, pre-bailout levels for the FY 2011 budget would cut the federal R&D investment by $8.1 billion (5.5%) from FY 2010 and $8.5 billion (5.7%) from the President's FY 2011 request assuming FY 2008 R&D funding levels. The hardest hit agencies would be those that were authorized in America COMPETES Act and have seen strong increases since the Act was passed in 2007. These agencies include the National Science Foundation (-11.1% in R&D from FY 2010), the Department of Energy's Office of Science (-14.8% in R&D from FY 2010), and the National Institute of Standards and Technology (-14.1% in R&D from FY 2010). For the National Science Foundation, this equates to over 1,400 less new awards than in FY 2010. Additionally, the multi-agency US Global Change Research Program (USGCRP) has seen an increase in funding from $1.8 billion in FY 2008 to $2.6 billion in the President's FY 2011 request, a 39.8 percent increase. Budget rollbacks would make it difficult for agencies to sustain their current level of commitment to multi-agency initiatives such as the USGCRP. Second, a hard cap on future growth of the discretionary budget would make it more difficult for Congress to implement R&D growth initiatives such as the President's Plan for Science and Innovation and the America COMPETES Reauthorization Act, currently under consideration in Congress. While A Pledge to America does not address R&D investment, Rep. Ralph Hall (R-TX), the likely chairman of the House Science and Technology Committee in the 112th Congress, gave some indication as to his priorities in the next Congress in a November 3rd statement. In the statement, he mentioned checking runaway spending, strong oversight, and the use of science policy to drive innovation as some of his priorities for the future.

Its clear that both parties intend to reduce overall federal spending, but there is disagreement as to when those cuts will occur and to what extent. The administration wants to wait until the FY 2012 fiscal year to implement the budget cuts so as to not interrupt the current economic recovery, the House Republicans would like to see those budget cutbacks in the FY 2011 budget and to a greater degree than the administration, and Senate Republicans have announced they are working with their Democratic colleagues on a FY 2011 omnibus appropriations bill for consideration in the lame duck session with a much smaller spending cut ($28 billion less than the President's request) than suggested by their House counterparts. It will be up to the legislative process to determine what exactly will happen, but with Senate Republican support and a Democratic majority in the House for the lame duck session, an omnibus spending bill during the lame duck session looks most likely at this point.

Outdated... See Nov. 30 update above - Table: Estimated R&D in A Pledge to America
Coverage in the New York Times: Money for Scientific Research May Be Scarce With a Republican-Led House
OMB Memo: Fiscal Year 2012 Budget Guidance
OMB Memo: Identifying Low-Priority Agency Programs
Presidential Press Conference - November 3, 2010 (R&D discussed at 23:00)
The 2010 Republican Agenda, A Pledge to America
Hall Statement on Election Results and the 112th Congress

- updated November 9, 2010

- posted November 4, 2010

EU Industrial R&D Investment Scoreboard Released

The 2010 edition of the EU Industrial R&D Investment Scoreboard was released by the European Commission last week. The scoreboard shows that R&D investment by top EU companies fell by only 2.6% in 2009, while sales and profits posted double digit percentage declines of 10.1% and 21.0% respectively. R&D investment by top US companies fell by almost twice as much, 5.1%. Worldwide, flat or growing R&D investment by Asian countries resulted in a worldwide R&D investment reduction of only 1.9%.

EU Industrial R&D Investment Scoreboard

- posted November 12, 2010

About the R&D Budget and Policy Program

Since 1976, the R&D Budget and Policy Program has been providing timely, comprehensive, and independent analyses of R&D funding trends in the federal budget as a service to the science, engineering and policymaking communities.

Through its Web site and email list, the Program makes available continually updated coverage of R&D funding trends, ongoing budget debates in Congress and the Executive Branch, and potential impacts of budget legislation. The Web site also offers a guide to R&D funding data as well as downloadable copies of its printed reports.

Every spring, the Program hosts the annual AAAS Forum on Science and Technology Policy (formerly the AAAS Colloquium), the nation's premier conference devoted to S&T policy. The next Forum will be held May 13 - 14, 2010, in Washington, DC.