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On February 13, the 108th Congress approved the 11 unfinished
fiscal year (FY) 2003 appropriations bills in an omnibus package, completing
a task the 107th Congress should have finished. President Bush
signed the omnibus bill on February 20, finally providing final FY 2003
budgets for agencies that had been operating at FY 2002 levels on stopgap
appropriations for more than four months. The budget provides a record-breaking
increase for defense R&D, nearly completes the campaign to double
the National Institutes of Health (NIH) budget over five years, and offers
a substantial increase for the National Science Foundation (NSF).
- The federal investment in research and development (R&D) hits a new record
of $117.3 billion in FY 2003, a $14.2 billion or 13.8 percent increase
over FY 2002 that is the largest dollar increase in history coming after
another record increase last year, and the largest percentage increase
in 20 years (see Table 1 and Figure 1).
Figure 1. (click on the image to view or download a full-page
color PDF version of the chart)
- In contrast to proposed cuts for
most agencies in the budget request, the FY 2003 budget provides at
least modest increases for nearly all the major R&D funding agencies
(see Table 1 and Figure 2). The
priority areas of defense, health, general science, and homeland security
receive even greater increases. The largest dollar and percentage
increases go to the two largest R&D funding agencies, the Department
of Defense (DOD) and NIH, reflecting the high priority placed on defense
and health by the Bush Administration and Congress. DOD R&D increases
by $8.8 billion or 17.6 percent to reach $58.6 billion following a similar
increase last year. NIH R&D increases 15.5 percent to $26.2 billion
to fall only slightly short of completing a five-year campaign to double
the NIH budget. Among the other agencies, NSF does well with
an 11.4 percent boost in its R&D funding to an all-time high of
$3.9 billion, which could be the first installment of a five-year campaign
to double its budget.
Figure 2. (click on the image to view or download a full-page
color PDF version of the chart)
- There are large increases for basic
and applied research in FY 2003, especially in NIH. The total federal
investment in research is $52.9 billion, an increase of 9.7 percent
or $4.7 billion over FY 2002 that is well above the FY 2003 request
(see Table 2 and Figure 2). NIH remains the
largest single sponsor of basic and applied research; in FY 2003, NIH
alone will fund 47 percent of all federal support of research, its highest
share in history. All federal departments except the Departments of
Transportation (DOT) and Commerce receive increases for their research
portfolios, with especially large increases for research in NIH, NSF,
and the National Aeronautics and Space Administration (NASA).
- Although it was officially created only at the end of January, the new Department of Homeland Security (DHS)
is poised to become a major player in federal R&D funding. For
FY 2003, R&D programs scheduled to transfer to the new department
this year would receive $669 million in R&D funding, nearly triple
the $266 million for comparable programs in FY 2002. Because there is
no budget account yet for DHS, these programs are funded in FY 2003
in their current agencies (DOT, DOD, USDA, and DOE) and will transfer
to DHS beginning March 1. In FY 2004, when the new DHS will initiate
its own R&D programs, DHS R&D would jump to $1.0 billion in
the request.
- R&D for nearly all the national
missions increases, with especially large boosts for defense and health
R&D (see Table 3). In defense, DOD
S&T investments exceed $11 billion to reach $11.2 billion (up 8.6
percent) but there are even larger increases for DOD development projects.
In health, the NIH budget nearly doubles between FY 1998 and FY 2003
with a $3.5 billion increase in FY 2003 to $26.2 billion for R&D,
including substantial increases for bioterrorism research and bioterrorism
research facilities. Another priority would be general science programs,
up 6.4 percent to $7.0 billion, led by an 11.4 percent for NSF’s R&D
programs but moderated by flat funding for the Department of Energy’s
(DOE) Office of Science. Space R&D would also be a big winner with
a 9.2 percent increase to $10.1 billion because of large increases in
the Space Science program and a continuing shift from aeronautics R&D
to space-related technology development. The only area of R&D to
decline would be transportation (down 7.6 percent to $1.7 billion) because
of cutbacks in NASA aeronautics R&D and a decline in DOT R&D.
Figure 3. (click on the image to view or download a full-page
color PDF version of the chart)
- Nondefense R&D reaches another all-time high in FY 2003, the seventh
year in a row that nondefense R&D has increased in inflation-adjusted
terms (see Figure 3). A large part of this recent growth has been due
to steady growth in the NIH budget, including increases of approximately
15 percent for five years in a row. As a result, NIH R&D has become
nearly as large as all other nondefense agencies’ R&D funding combined.
Funding for nondefense R&D excluding NIH has stagnated in recent
years; after steady growth in the 1980s, funding peaked in FY 1994 and
then declined sharply as a result of tight budget conditions in the
mid-1990s. The FY 2003 increases for non-NIH agencies, while large,
just barely bring these agencies back to the funding levels of the early
1990s. The FY 2004 budget request, already released, would provide increases
smaller than the expected rate of inflation for nondefense R&D compared
to FY 2003 (see AAAS Report XXVIII: R&D FY 2004 for details of the FY 2004 request).
- R&D earmarks total $1.4 billion in FY 2003, according to a AAAS
analysis of congressionally designated, performer-specific R&D projects
in the final FY 2003 budget. Although these projects amount to only
1.2 percent of total R&D, they are concentrated in a few key agencies
and programs. Four agencies (USDA, $297 million; NASA, $190 million;
DOE, $138 million; and DOD, $426 million) receive nearly three-quarters
of the total R&D earmarks. FY 2003 earmarks are down $26 million
from the $1.5 billion in FY 2002.
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