American Association for the Advancement of Science

AAAS Analysis of R&D in the FY 2009 Budget
March 7, 2008 (REVISED) -

2009 Budget Proposes Physical Sciences and Development Increases,
Flat Funding for Biomedical Research

AAAS Analysis of R&D in the FY 2009 Budget (Revised)

Go to:

-R&D in the FY 2009 Budget: Physical Sciences Remain a Top Priority

-The FY 2009 R&D Budget in Historical Context

-Highlights of the Major R&D Funding Agencies

-Budget Context and Outlook: Tough Choices for Congress

-Table 1. R&D in the FY 2009 Budget by Agency

-Table 2. Research in the FY 2009 Budget

-Table 3. Major Functional Categories of R&D

- Table 4. Homeland Security R&D

- Table 5. R&D by Appropriations Subcommittee

- Table 6. Interagency Science and Technology Initiatives

- Table 7. "FS&T" in the FY 2009 Budget

PDF version of this document

Full text of AAAS Report XXXIII: Research & Development FY 2009

Detailed agency updates:

U.S. Department of Agriculture

Department of Commerce

Department of Defense

Department of Energy

Department of Homeland Security

Department of the Interior

Department of Transportation

Department of Veterans Affairs

Environmental Protection Agency

National Aeronautics and Space Administration

National Institutes of Health and HHS

National Science Foundation

Supplemental Tables and Full-Color Charts (PDF)

-Table. Total R&D by Agency (revised 3/08)

-Table. Basic Research by Agency (revised 3/08)

-Table. Applied Research by Agency (revised 3/08)

-Table. Research in the FY 2009 Budget (revised 3/08)

-Table. Development by Agency (revised 3/08)

-Table. Conduct of R&D by Agency (revised 3/08)

-Table. R&D Facilities and Capital Equipment by Agency (revised 3/08)

-Historical Table 1. R&D by Agency, 1976-2009 (revised 3/08)

-Historical Table 2. R&D by Agency, 1976-2009 in Constant Dollars (revised 3/08)

-Chart. Trends in Federal R&D, 1976-2009(revised 3/08)
- Data Table

-Chart. Trends in Federal R&D by character of work, 1976-2009 (revised 3/08)

- Chart. Trends in Federal R&D as % of GDP, FY 1976-2009
(revised 3/08) - Data Table

-Chart. Selected Trends in Nondefense R&D, 1976-2009 (revised 3/08)

-Chart. Trends in Research by Agency, 1976-2009(revised 3/08) - Data Table

-Chart. Trends in Basic Research, 1976-2009(revised 3/08)- Data Table

-Chart. Trends in Defense R&D, 1976-2009 (revised 3/08) - Data Table

-Chart. Trends in DOD S&T, 1994-2009 (2/08) - Data Table

-Chart. Trends in DOD R&D by Agency, 1991-2009 (2/08) - Data Table

-Chart. Trends in Federal R&D, FY 1998-2009 (DOD, NIH, NSF, DOE, NASA, USDA) (revised 3/08)

-Chart. Trends in Federal R&D, FY 1998-2009 (DOC, DOI, DOT, EPA) (revised 3/08)

-Chart. Trends in DOE Office of Science, 2000-2009 (2/08) - Data Table

- Chart. Trends in DOE R&D, 1990-2009 (revised 2/08)

- Chart. NIH Budget by Institute, 1998-2009 (2/08) - Data Table

- Chart. NIH Budget by Funding Mechanism, 1998-2009 (2/08)

- Chart. NSF Budget, 2000-2009 (2/08)

- Chart. NSF Budget by Directorate, 2000-2009 (2/08)

-Chart. Defense and Nondefense R&D, 1955-2009 (preliminary 2/08) - Data Table

-Chart. Nondefense R&D by Function, 1955-2009 (preliminary 2/08) - Data Table

 

(All figures in this analysis are revised from the February AAAS Preliminary Analysis. This analysis is a preview of the forthcoming AAAS Report XXXIII: Research and Development FY 2009, a comprehensive look at the President's budget for R&D in FY 2009. More tables and continually updated supplemental materials on R&D in the FY 2009 budget can be found on the AAAS R&D Web site at www.aaas.org/spp/rd).

On February 4, President Bush released his proposed budget for fiscal year (FY) 2009. The $3.1 trillion budget projects a deficit exceeding $400 billion next year, despite excluding most 2009 war costs and holding domestic spending flat. Within a flat domestic budget, the 2009 budget continues to propose large increases for the three physical sciences agencies in the American Competitiveness Initiative (ACI), increases for human spacecraft development, flat funding for biomedical research in the National Institutes of Health (NIH), and mostly increases in other parts of the federal research and development (R&D) portfolio but cuts to key environmental and agricultural R&D agencies. Defense R&D would continue to increase, and next year defense basic research in the physical sciences would share in the gains. Despite tough budget conditions, the overall federal investment in R&D would increase $4.9 billion or 3.5 percent to $147.4 billion, driven primarily by increases in development funding. The federal investment in basic and applied research would fall 0.3 percent to $57.3 billion in 2009 as proposed gains in the ACI agencies would be offset by cuts in other agencies’ research funding, primarily cuts in congressional earmarks. Federal research funding would fall for the fifth year in a row in real dollars.

 R&D in the FY 2009 Budget: Physical Sciences Remain a Top Priority

In its broad outlines, President Bush’s proposed budget for FY 2009 once again offers the same themes as in previous years: big increases for defense and homeland security, trims in some entitlement programs, extensions of expiring tax cuts, and plans to reduce the budget deficit primarily by cutting domestic discretionary spending and by not budgeting for future war costs. There is also continuity in the President’s proposals for the federal R&D portfolio: despite appropriations setbacks, the budget stays on track with the third year of the American Competitiveness Initiative (ACI) vision of doubling between 2006 and 2016 the budgets of the National Science Foundation (NSF), the Department of Energy (DOE) Office of Science, and the National Institute of Standards and Technology (NIST) laboratories in Commerce. The three research-oriented ACI agencies lead the pack in R&D gains (see Figure 1), followed closely by proposed gains for development programs in DOE, the National Aeronautics and Space Administration (NASA) and the Department of Defense (DOD; see Table 1). But in other areas of the federal R&D portfolio, cuts in past budgets turn into requested increases this time around. While biomedical research in the National Institutes of Health (NIH) would remain flat, in a tight domestic budget most other R&D funding agencies would see gains, especially when congressional earmarks, which are absent in the President’s request, are excluded from the 2008 funding level to allow for non-earmarked 2008 to 2009 comparisons (see Figure 1). As a result, most federal R&D agencies would see real increases for their R&D programs if the budget is enacted, although there would be cuts to agricultural and environmental R&D agencies.  

(Most figures in this release have been revised from preliminary data in the February AAAS Preliminary Analysis. FY 2008 and FY 2009 figures exclude pending war-related supplementals. In many cases, AAAS revisions made for this analysis and forthcoming revisions result in funding trends that differ significantly from funding trends reported in the President’s budget documents. Funding trends describing earmarks are based on the January 2008 AAAS analysis of R&D in final 2008 appropriations.)

 
Figure 1. (click on image for PDF)


Figure 2. (click on image for PDF)

- The proposed federal R&D portfolio in FY 2009 is a record $147.4 billion, $4.9 billion or 3.5 percent above this year’s current funding level (see Table 1 and Figure 2). Once pending war-related supplementals for DOD development in 2008 and 2009 are added, federal R&D totals for both years will climb even higher. Once again, development funding would hit a new high of $85.4 billion (up $4.8 billion or 6.0 percent) because of large increases for DOD weapons and NASA spacecraft development. R&D facilities funding would gain 6.2 percent to $4.7 billion (see Table 1) because of large increases for NASA’s International Space Station and DOE Science support on projects such as the International Thermonuclear Experimental Reactor (ITER).

 - Total federal support of research (basic and applied) would fall 0.3 percent or $151 million to $57.3 billion, even after large proposed increases for physical sciences and related research in NSF, DOE’s Office of Science, and NIST (see Table 2 and Figure 3). Removing 2008 congressional earmarks from the new budget request ($1.1 billion in research earmarks for DOD alone) accounts for the cut; excluding earmarks from the 2008 base, federal research spending in 2009 would increase by enough to keep pace with expected inflation of 2.0 percent. NIH research funding would stay flat at $28.5 billion, while most other agencies would see gains in non-earmarked research funding. In real terms, the federal research portfolio would fall for the fifth year in a row and would be down 9.1 percent from 2004.


Figure 3. (click on image for PDF) 

- President Bush’s American Competitiveness Initiative (ACI) would once again be the big winner among domestic programs. The three ACI agencies (NSF, NIST laboratories, DOE Office of Science) would collectively receive $12.2 billion in the 2009 budget, a 15 percent increase over this year (see Table 7; includes R&D and non-R&D). The NSF budget of $6.9 billion would be a 14 percent increase, with increases approaching 20 percent for the Mathematical and Physical Sciences (MPS), engineering and computer science directorates and smaller increases for non-physical sciences directorates. DOE’s Office of Science request for $4.7 billion would be a 19 percent increase restoring funding for ITER, physics, and other basic research projects hard hit by the 2008 appropriation. And the NIST labs would receive a large increase, though at the cost of proposed eliminations of NIST’s external programs (the Technology Innovation Program and the Hollings Manufacturing Extension Partnership). In a surprising development, DOD requests a 4 percent increase in its basic research (“6.1”) portfolio to $1.7 billion, a 16 percent boost if earmarks in the 2008 base are excluded. DOD is a key sponsor of the physical sciences, but until now physical sciences advocates have been unsuccessful in convincing DOD to boost this investment. 

- The National Institutes of Health (NIH) would receive exactly the same amount ($29.5 billion) in 2009 as in 2008; nearly all of NIH’s institutes and centers would also get the same budgets as this year. Several biomedical research advocacy organizations have already decried the 2009 proposal for leaving NIH 13 percent below the 2004 funding level after adjusting for biomedical research inflation. The number of new grants, the average real size of a grant, and the expected success rate for grant competitions are all expected to fall in 2009. 

- NASA R&D would increase to fund the development and construction of new human spacecraft. NASA R&D would gain 4.9 percent to $12.8 billion, but the entire increase and more would go to two big projects: finishing the International Space Station and developing the Crew Launch Vehicle and Crew Exploration Vehicle combination. As a result, NASA support of research in the physical sciences, environmental sciences, aeronautics, and other disciplines would fall once again.

- Nondefense R&D would increase 3.1 percent to $62.8 billion, far better than the flat funding requested for all nondefense discretionary programs and well ahead of the 2.0 percent expected inflation rate (see Table 3 and Figure 2). Boosts for the ACI and space vehicles development help to offset requested cuts to earmarks and other smaller nondefense R&D programs and flat funding for NIH R&D, but overall the nondefense portfolio continues to be flat or declining since peaking in 2004 (see Figure 2).

- Most R&D agencies would see increases in 2009, especially if congressional earmarks are excluded (see Figure 1). While R&D in the U.S. Department of Agriculture (USDA) would decline 1 percent even when $369 million in 2008 R&D earmarks are not counted, and Environmental Protection Agency (EPA) R&D and U.S. Geological Survey (USGS) R&D would fall 0.4 percent and 7 percent, respectively, because of proposed program cuts, most other R&D funding agencies would see gains ahead of expected inflation (see Table 1). Even DOE’s energy R&D programs, coming off extraordinary congressional and requested increases in 2008, would gain another 8.7 percent to reach $2.4 billion and the Department of Homeland Security (DHS) would rebound from budget troubles in recent years with a 4.1 percent gain to $1.0 billion (see Table 1) that becomes a 13.5 percent boost without 2008 earmarks. 

- Defense R&D continues to climb to record levels in wartime, and will be boosted further in both 2008 and 2009 when billions of dollars in war-related supplemental funds are enacted later this year. Total defense R&D would reach $84.5 billion in 2009, up 3.7 percent over FY 2008. Although the total in real terms would be off slightly from the record 2007 funding level (see Figure 1), both 2008 and 2009 are likely to hit all-time highs after supplementals are enacted. DOD weapons systems development would increase dramatically by $4.5 billion or 6.9 percent to a new high of $69.0 billion, but once again there would be steep cuts in DOD’s S&T (DOD “6.1” through “6.3” plus medical research) programs because of the proposed elimination of earmarks. DOD S&T would plummet 11.7 percent to $11.7 billion, but would increase 5.6 percent if 2008 earmarks are excluded (see Figure 1). DOD basic research would do especially well with $1.7 billion, a 4 percent increase that becomes a 16 percent increase if earmarks are excluded.

- The Administration priorities of basic physical sciences, space exploration, and defense development show up clearly in the federal R&D portfolio by mission (see Table 3). The priority missions would all receive large increases, while R&D for most other national missions would gain modestly. Proposed ACI boosts to the DOE Office of Science and NSF make up the 16.9 percent gain for general science R&D to $10.2 billion, while the NIST labs’ increase offset partially by NIST extramural cuts would boost commerce R&D by 3.3 percent. Space-related R&D would gain 5.6 percent to $12.3 billion, entirely from gains in development funding of new space vehicles instead of the broader space R&D portfolio. R&D for other national missions including agriculture (down 17 percent) and the environment (down 4 percent) would fall primarily from the proposed elimination of earmarks. Energy R&D would gain 0.6 percent to $2.5 billion. Funding for health R&D, the largest nondefense mission, would increase slightly by 0.5 percent to $30.8 billion because of flat funding for NIH and Department of Veterans Affairs (VA) R&D combined with a large increase in biodefense countermeasures R&D in the Department of Health and Human Services (HHS) to $250 million.  

- Federal homeland security-related R&D would gain 10.2 percent to $5.5 billion in FY 2009, a gain of $507 million reflecting a budget proposal that favors defense spending, and homeland security over most other domestic priorities (see Table 4). The majority of the multi-agency portfolio remains outside the Department of Homeland Security (DHS), with the largest part in NIH for its biodefense research portfolio. NIH’s portfolio, mostly in the National Institute of Allergy and Infectious Diseases (NIAID), would total $1.9 billion in FY 2008 (up 1.0 percent). The largest domestic increase would be a $250 million allocation (more than double the $102 million this year) in the Biomedical Advanced Research and Development Authority (BARDA) for R&D on biomedical countermeasures. DOD would continue to increase spending on homeland security-related activities with $1.5 billion, up 16 percent, primarily in Defense Agencies such as the Chemical and Biological Defense Program (CBDP) and the Defense Threat Reduction Agency (DTRA) but with the largest 2009 increase coming from the Air Force. Large increases would also go to food safety research in USDA and decontamination and drinking water protection projects at EPA. 

- President Bush’s FY 2009 budget now goes to Congress where the R&D requests will go through the appropriations process. Democratic appropriators have reorganized appropriations jurisdictions into 12 bills, 10 of which fund some R&D (see Table 5). As in the past, 95 percent of the federal R&D portfolio will be appropriated through 4 appropriations bills. 

- Multi-agency initiatives on nanotechnology, information technology, and climate change science would all do well in the 2009 budget because of the emphasis on the physical sciences in the ACI and a generally solid R&D budget request. Climate Change Science Program (CCSP) funding would climb above $2 billion for the first time since 2003 with a 9.6 percent or $177 million increase to $2.0 billion (see Table 6), thanks to environmental sciences programs at NSF and DOE Science benefiting from ACI-inspired increases for these agencies and also thanks to a restructuring of NASA spending to boost spending on the earth sciences and especially satellite-based observations of climate change within a shrinking NASA research portfolio. After several rough years, NASA contributions to the CCSP would rebound with a $126 million or 11.7 percent increase to $1.2 billion in 2009. Squarely in the mainstream of the physical sciences, the Networking and Information Technology R&D initiative would enjoy a 6.2 percent increase to $3.5 billion because of surging requests for two of its key sponsors, NSF and DOE Science. And the National Nanotechnology Initiative would benefit from ACI increases for NSF, DOE Science, and NIST to reach $1.5 billion (up 2.4 percent), partially offsetting steep cuts in DOD’s contributions.  

- The “Federal Science and Technology” (FS&T) budget, an alternative measure of the federal investment in science and technology, would decline $159 million or 0.3 percent to $61.8 billion because of the proposed elimination of 2008 earmarks in 2009 (see Table 7). The collection of mostly R&D programs along with education, human resources, and other non-R&D programs, is designed by the Office of Management and Budget (OMB) to offer another indicator of federal funding for research-oriented programs. Combined funding for the ACI agencies, a subset of the FS&T budget, would be $12.2 billion in 2009, a dramatic increase of 15.0 percent or $1.6 billion when most other FS&T programs would decline.


Figure 3. (click on image for PDF)

 The FY 2009 R&D Budget in Historical Context

Although high-priority investments in physical sciences research, weapons development, and human space exploration help to keep the federal R&D outlook brighter than the bleak outlook for domestic programs overall, the FY 2009 budget continues the recent trends of declining federal support for research. 

 The federal investment in basic and applied research would fall in real terms for the fifth year in a row (see Figure 3) if the FY 2009 budget is enacted. Federal research did very well between 1998 and 2003 because of the campaign to double the budget of NIH, the largest federal supporter of research. Other agencies also increased their research investments in that time period because a string of budget surpluses freed up resources for domestic appropriations. But with the return of budget deficits in 2002 followed by restraints on domestic spending thereafter, growth in research funding for NIH and other domestic agencies slowed in 2004 and then reversed. At the same time, DOD research support lagged as the Pentagon went to war in 2003 and shifted resources away from research toward near-term projects, and NASA research fell even within a stable R&D budget as it shifted resources from research to development. As a result, federal support for research is now in decline, with potential gains in the physical sciences more than offset by eroding support for biomedical research and other disciplines. The 2009 budget would continue the downward slide in federal research funding and leave the federal research portfolio 9.1 percent below the 2004 level in inflation-adjusted dollars.


Figure 4. (click on image for PDF)

Federal research investments are shrinking as a share of the U.S. economy, just as other nations are increasing their investments. As shown in Figure 4, the federal R&D investment exceeded 1 percent of U.S. Gross Domestic Product (GDP) until recently, buoyed by big increases in weapons development, but is now declining sharply. Federal investments in development, mostly in DOD, have held steady as a share of the economy, but the federal research/GDP ratio is in free fall down to a projected 0.38 percent in 2009, below the long-term historical average of 0.4 percent after gains in the late 1990s. Despite an increasingly technology-based economy and a growing recognition among policymakers that federal research investments are the seed corn for future technology-based innovations, the U.S. government research investment has so far failed to match the new realities despite the rallying points of innovation and the American Competitiveness Initiative, and has also failed to match the competition. Asian nations are dramatically increasing their government research investments: both China and South Korea, for example, are boosting government research by 10 percent or more annually.

 Highlights of the Major R&D Funding Agencies

(Complete coverage of the major R&D funding agencies will be available in the forthcoming AAAS Report XXXIII: R&D FY 2009 and on the AAAS R&D web site in agency updates. Most figures in this analysis have been revised since the February release of the FY 2009 budget.)

 - The National Institutes of Health (NIH) would receive exactly the same budget in 2009 as in 2008, a total of $29.5 billion (up 0.0 percent). Most of NIH’s institutes and centers (IC’s) would see their budgets remain flat for the fifth year in a row, with no allowance for inflation. NIH R&D would also remain flat, at $28.7 billion (up 0.0 percent; see Table 1). In 2009, there would be fewer new research, the real size of the average research grant would shrink for the fifth year in a row, and the success rate for grant competitions could fall to a new low of 18 percent. After peaking in 2004, the NIH budget has declined every year in real terms, and if enacted the 2009 request would leave NIH funding 8 percent below 2004 after adjusting for economy-wide inflation and 13 percent below 2004 after adjusting for NIH’s own calculations of biomedical research inflation. With the budget freeze, there would be few new initiatives; a rare growth area would be the NIH Common Fund (NIH Roadmap) in the Office of the Director with a $534 million request (up 8.8 percent), offset by the proposed cancellation of a $92 million children’s health research study. Elsewhere in the Department of Health and Human Services (HHS), the Biomedical Advanced Research and Development Authority (BARDA) requests $250 million for R&D on biomedical countermeasures, more than double the $102 million 2008 allocation.


Figure 5. (click on image for PDF)

- The National Science Foundation (NSF) benefits from the Administration’s American Competitiveness Initiative with a 13.6 percent boost for its total budget to $6.9 billion in 2009 (see Table 7), an especially large increase designed to keep the agency on track to double its budget between 2006 and 2016 after appropriations setbacks in 2007 and 2008. NSF’s R&D investments (excluding education, human resources, and overhead spending) would total $5.2 billion, a 15.5 percent increase to an all-time high in real terms (see Table 1). All of NSF’s research directorates would receive large increases in 2009 after flat funding in 2008, and all would recover from budget cuts after 2004 to reach all-time highs in inflation-adjusted dollars (see Figure 5). The 2009 NSF request clearly favors the physical sciences, with requested increases approaching 20 percent for the Mathematical and Physical Sciences (MPS; up 20 percent), Engineering (ENG; up 19 percent), and Computer and Information Science and Engineering (CISE; up 20 percent) directorates. The Biological Sciences (BIO; up 10 percent), Geosciences (GEO; up 13 percent), and especially the Social, Behavioral and Economic Sciences (SBE; up 9 percent) directorates would lag behind but would narrowly manage to match past funding levels (see Figure 5). NSF’s education and human resources programs would gain 9 percent to $790 million.

- The Department of Defense (DOD) R&D investment continues to grow, with a proposed increase of $2.9 billion or 3.7 percent to $80.7 billion in 2009 (see Table 1), but both the 2008 and 2009 totals will grow by billions later this year when war-related supplementals are added. In a surprise move, DOD requests a 4.0 percent increase to $1.7 billion for its basic research (“6.1”) portfolio, the majority of which is performed in universities (see Table 2). Taking out $165 million in 2008 basic research earmarks results in a remarkable 16 percent increase for “6.1” between non-earmarked 2008 funding and the 2009 request. “6.1” funding in all three military services and the Defense Agencies would gain, with particularly large increases in Navy and Air Force basic research. For the past several years, science and engineering advocates have pressed DOD, a key sponsor of the physical sciences, to join efforts such as the ACI to increase federal physical sciences funding. “Science and Technology” (S&T), which includes basic research and also applied research, medical research, and technology development, would fall 11.7 percent to $11.7 billion, but entirely because DOD would not renew $2.2 billion in 2008 S&T earmarks. Excluding 2008 earmarks, DOD “S&T” would gain 5.6 percent between 2008 and 2009 (see Figure 2). The research-oriented Defense Advanced Research Projects Agency (DARPA) would do spectacularly well with a request of $3.3 billion, an 11 percent increase. DOD weapons development would increase dramatically by 6.9 percent or $4.5 billion to an all-time high of $69.0 billion (see Table 1).  

- The National Aeronautics and Space Administration (NASA) budget would grow $497 million or 2.9 percent to $17.6 billion in 2009, with the entire increase and more going to two big-ticket human space programs. The Constellation Systems program to develop the next generation of human spacecraft would receive $3.0 billion, an increase of 23.3 percent or $576 million, including a billion dollars each for the Crew Exploration Vehicle and the Crew Launch Vehicle. The International Space Station would receive $2.1 billion, a $247 million or 13.6 percent increase, as construction ramps up toward completion. But increases for these two programs would leave NASA’s research-oriented programs in decline once more. The Science portfolio would fall 5.6 percent to $4.4 billion after a modest gain in 2008, with especially steep cuts for the Astrophysics (down 13 percent) and Heliophysics (down 31 percent) portfolios because of the winding down of several large missions including the Hubble Space Telescope. Planetary Science (up 7 percent) and Earth Science (up 7 percent) would receive boosts, however, with a special emphasis on new earth science missions. Aeronautics research funding would continue to tumble with a 13 percent cut to $447 million. The NASA R&D portfolio would increase 4.9 percent to $12.8 billion (see Table 1), with the entire $592 million increase and more coming from Constellation Systems and the Space Station.


Figure 6. (click on image for PDF)

- The Department of Energy (DOE) R&D portfolio would do well with a 8.9 percent or $858 million increase to $10.5 billion because of continuing Administration support for DOE’s Office of Science (OS) as part of the American Competitiveness Initiative (ACI). DOE Science would be a clear winner with a 18.9 percent proposed increase to $4.7 billion for its total budget, in an effort to keep the office on track to double its budget between 2006 and 2016 after appropriations setbacks the last two years. R&D in DOE Science would be $4.3 billion, up 21 percent (see Table 1 and Figure 1). Most Science programs would receive substantial increases to hit historic highs (see Figure 6), but these gains depend crucially on the outcome of 2009 appropriations. After a significant hit in 2008 that deleted the U.S. contribution to the multi-national International Thermonuclear Experimental Reactor (ITER) project, fusion research would total $493 million, up 72 percent, including a $215 million ITER contribution for 2009. Basic Energy Sciences (BES) would dominate the portfolio with $1.6 billion, up 24 percent. The High-Energy Physics program would try to recover from sharp cuts in 2008 with a 17 percent boost to $805 million, while Nuclear Physics would gain 18 percent to $510 million. DOE’s energy R&D would total $2.4 billion, a 0.5 percent gain after an enormous congressional increase in 2008. Investments in renewables such as biomass and nuclear energy would continue to gain. Coal R&D would soar 26 percent to $624 million, including a 25 percent boost to $149 million for carbon sequestration research and a doubling of funding for the recently restructured FutureGen project to $156 million. But DOE once again proposes to eliminate R&D on gas and oil technologies, and proposes to cancel $50 million in mandatory funding for a deepwater oil and gas exploration R&D program.

- The Department of Homeland Security (DHS) R&D portfolio fell sharply in 2007 because of congressional dissatisfaction with the new department’s R&D efforts, but has since steadied and would gain slightly in 2009 to $1.0 billion (up 4.1 percent; see Table 1). The R&D increase would be 13.5 percent excluding a bumper crop of 2008 R&D earmarks (see Figure 2). Research on radiological and nuclear countermeasures would gain slightly (up 1.8 percent to $279 million) in the Domestic Nuclear Detection Office (DNDO), while chemical and biological countermeasures R&D in the Science and Technology Directorate would fall. University Programs funding would fall from $49 million in 2007 and 2008 down to $44 million in 2009. In addition, DHS will receive $2.2 billion in already-appropriated funds for Project Bioshield in 2009, to procure promising biodefense countermeasures from the private sector.

- R&D in the U.S. Department of Agriculture (USDA) appears to fall a dramatic 15.5 percent in 2009 to $2.0 billion (see Table 1), but as in past years the requested cut is due to the proposed elimination of congressional earmarks. Congress is likely to add back earmarks in 2009 appropriations. Excluding earmarks from the 2008 base, USDA R&D would decline just 1.0 percent between 2008 and 2009 (see Figure 1). On the extramural side, the National Research Initiative (NRI) of competitively awarded research grants would increase $66 million to a record $257 million, although similar proposed increases in past years have not made it through Congress. Hatch Act funding would fall from $196 million to $139 million. USDA intramural research would fall $84 million to $1.0 billion, but the cut would become a small increase after adjusting for 2008 earmarks.

- The National Institute of Standards and Technology (NIST) laboratories in the Department of Commerce would benefit from the ACI. NIST intramural research would climb 16 percent to $447 million, while intramural construction funding would also gain. But the Bush Administration once again proposes to eliminate NIST’s extramural Technology Innovation Program (TIP), and would close out the non-R&D Hollings Manufacturing Extension Partnership with a $4 million request. In order to restore funding for the extramural programs, Congress is likely to trim the requested increases for intramural programs. Total NIST R&D would increase 4.7 percent to $546 million (see Table 1). Also in Commerce, National Oceanic and Atmospheric Administration (NOAA) R&D would fall slightly to $576 million, but after taking out 2008 earmarks the 2009 increase for core NOAA research programs would be 7.5 percent (see Figure 1). 

- The Department of Veterans Affairs (VA) would maintain a flat R&D budget of $884 million in FY 2009 after large gains in 2007 and 2008 from emergency supplemental appropriations (see Table 1).  

- R&D in the Department of the Interior would fall 9 percent to $618 million, with a similar 7.0 percent cut to $546 million for R&D in Interior’s lead science agency, the U.S. Geological Survey (USGS). As in previous years, the cuts would be concentrated in USGS’ mineral resources and water resources R&D, partially offset by a sharp increase in global change research.

- The Environmental Protection Agency (EPA) R&D portfolio of $541 million in 2009 would be a 1.3 percent cut from 2008, with cuts to most research areas partially offset by increases for homeland security-related research.

- Department of Transportation (DOT) R&D funding would increase 9.9 percent to $902 million because of large requested increases for aviation R&D in the Federal Aviation Administration (FAA) and continuing increases for highway R&D in the Federal Highway Administration (FHWA).

 Budget Context and Outlook: Tough Choices for Congress
 
Figure 7. (click on image for PDF)

The President’s 2009 budget projects deficits exceeding $400 billion for the next two years before balancing by 2012, though the budget reaches balance only through large proposed cuts in health care entitlements, an expanding reach for the Alternative Minimum Tax (AMT) to tens of millions of taxpayers, no war funding beyond early 2009, highly optimistic economic growth forecasts, and continuing real reductions in domestic discretionary spending. In 2009, nondefense spending would be held flat with 2008, meaning a decline in inflation-adjusted terms with further cuts envisioned in future years (see Figure 7). Already, nondefense spending has been flat or declining in real terms since 2004 with only a few exceptions for Hurricane Katrina, veterans, and international needs (see Figure 7). On the defense side, however, a war that only gets more expensive with time has pushed defense spending to record highs in 2008 (see Figure 7). The budget assumes a sharp drop in military spending in 2009 and future years, but only by excluding all war costs beyond January 2009. Adding in all war costs in 2008 and 2009 will likely push budget deficits into record $500 billion territory. 

In order to make room for substantial R&D funding increases, especially for the physical sciences, in a domestic discretionary budget that would barely increase, the President has proposed to eliminate more than 150 programs, including nutrition programs, health care grants, weatherization assistance, and $3 billion in education programs, and has proposed dramatic reductions in low-income heating assistance, state and local law enforcement grants, homeland security grants, job training grants, and other state and local block grants. 

As in past years, it seems highly unlikely that Congress would grant 15 percent or more increases for some R&D programs while eliminating or slashing such politically popular health, education, and labor programs. So Congress once again faces tough dilemmas as it considers the President’s budget. The 110th Congress will no doubt try, as it did last year, to add to the overall pot of money available for domestic appropriations, but President Bush will once again dig in with promised and actual vetoes for any appropriations exceeding his request, a tactic that forced Congress to give up $22 billion in additional domestic spending for 2008. President Bush will insist that Congress hold to his request for $988 billion in regular discretionary appropriations for 2009, an apparent $46 billion increase over 2008 but $45 billion of which would go to defense and other security-related spending. Congress may be successful this year in adding money to the request for domestic appropriations; but if not, then Congress will have a minuscule $1 billion or 0.3 percent increase to allocate for domestic non-security programs overall. Within that total, moving money around to restore funding for the hundreds of programs proposed for steep cuts or eliminations will likely end any hopes for the ACI agencies to receive their full requested increases. Ironically, political budget battles of 2008 will likely focus on the tiny $1 billion requested increase for domestic spending, while policymakers in both parties and both branches will barely blink at the price tags of $200 billion in annual war costs on top of $537 billion in regular defense spending, a roughly $150 billion economic stimulus package, and approximately $50 billion for a one-year AMT patch for 2008. 

The Democratic majority has already signaled that the President’s request for domestic appropriations is once again inadequate. In the upcoming debate on the 2009 budget resolution, the congressional response to the President’s budget, Congress will try to add money to the domestic appropriations total so that the Appropriations Committees can add money to individual programs later in the year. But any appropriations bills based on the budget resolution will run into the President’s veto pen if they exceed his request. Based on their actions in the 2007 and 2008 appropriations bills, appropriators appear poised to support the ACI increases in 2009 but only if additional domestic dollars are available. If President Bush succeeds in holding the line on domestic spending, then the ACI increases will be chiseled away to shore up funding for threatened domestic programs and to boost R&D requests in energy R&D, biomedical research, and environmental research. An additional complication this year is that President Bush leaves office in January 2009, so there could be a temptation for the Congress to postpone action on 2009 appropriations until a new President takes office in the hope that he or she will be more amenable to increasing domestic spending. But that strategy would result in federal agencies spending months in limbo after the October 1 start of FY 2009 waiting for final action on appropriations, and may not result in any additional funding. So once again, the science and engineering community prepares for a long budget season with uncertain outcomes where promises of renewing federal commitments to basic research once again meet the budgetary realities of tight limits on domestic spending.

 - March 7, 2008 REVISED

(More materials on R&D in the FY 2009 budget, historical data and charts, and more information on AAAS Report XXXIII: Research and Development FY 2009, can be found on the AAAS R&D Web site at www.aaas.org/spp/rd. The information in this analysis will be updated with further revisions.)

AAAS R&D Budget and Policy Program
1200 New York Ave, NW
Washington, DC 20005
(202) 326-6607
science_policy@aaas.org
http://www.aaas.org/spp/rd

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American Association for the Advancement of Science