On May 19, the Office of Management and Budget (OMB) notified
federal agencies that if President Bush wins reelection, next year's FY
2006 budget request would cut spending for nearly all domestic programs
as projected in February's FY 2005 budget, and that agencies should prepare
to make cuts for most domestic programs when they prepare their initial
FY 2006 proposals. The OMB memo leaked to the media this week as agencies
begin preparing their FY 2006 requests.
Nearly all federal R&D programs outside the priority areas of
defense, space, and homeland security would see their budgets decline
in FY 2006 under the scenario that OMB directs agencies to follow,
even programs that would receive increases in FY 2005.
As detailed in an April AAAS analysis of the
outyear projections for R&D in the FY 2005 budget (attached),
the Bush Administration's plan to reduce the federal deficit in half
over the next five years would cut R&D funding for 9 out of the
12 largest R&D funding agencies in real terms over the next five
years, with the steepest cuts in FY 2006 after this year's elections.
For FY 2006, the OMB guidance memo means all R&D funding agencies
except the Department of Defense (DOD), the National Aeronautics and
Space Administration (NASA), the Department of Energy (DOE), and the
Department of Homeland Security (DHS) must plan for cuts to their R&D
portfolios as they begin preparing their FY 2006 requests, even for
programs that are proposed to receive increases in FY 2005. The National
Science Foundation (NSF) and the National Institutes of Health (NIH),
proposed to receive increases in FY 2005, would see their gains reversed
in FY 2006.
Although the FY 2005 budget process has just barely started at a snail's
pace in Congress, federal agencies have already started formulating
their FY 2006 budget requests. Federal agencies and OMB will be working
together to draft agencies' FY 2006 requests from now until the official
release of the FY 2006 budget proposal next winter. Although the specific
program cuts outlined in the AAAS analysis are not binding, the OMB
guidance memo tells agencies the broad budgetary targets they must hit;
this year's memo leaves agencies with little room to maneuver because
it states that any increases to a program above the projected FY 2006
level would have to be offset by a cut in another program in the agency.
While the internal give-and-take between OMB and the agencies is just
beginning and will involve several months of negotiations and appeals,
it appears clear that the first budget of the potential second term
of this Bush Administration would follow the course outlined by the
President earlier this year: cuts in domestic spending accompanied by
increases in defense and homeland security, further tax cuts, and unrestrained
growth in entitlements spending. Although the specific program cuts
outlined in the budget projections will change over the next several
months of negotiations, it is clear that nondefense R&D outside
NASA and DHS would decline steeply in FY 2006 unless there is either
a change in the White House or a major change in Bush Administration
FY 2006 R&D Projections
The April AAAS analysis of the outyear projections
in the FY 2005 budget focused on the five-year outlook for federal
R&D out to FY 2009. Below are some highlights of the projections
just for FY 2006, illustrating the scenario that OMB directs the federal
agencies to follow:
- While NASA, DOD, DHS, and DOE would see increases in their R&D
funding between the proposed FY 2005 budget and the projected FY 2006
funding level, all the other R&D funding agencies would see their
R&D funding decline next year.
- NIH must plan for a 2 percent or $600 million cut in FY 2006 after
a 2.6 percent increase in FY 2005, leaving the agency with a total budget
of $28.2 billion, barely above this year's $28.0 billion budget. After
factoring in expected inflation, NIH's FY 2006 budget would be 2 percent
below this year's funding level.
- NSF would see its proposed gains in FY 2005 reversed the next
year with a 2 percent or $85 million cut for its R&D programs
in FY 2006, leaving NSF R&D below this year's funding level after
adjusting for inflation.
- Although DOE would see a gain in its R&D budget in FY 2006 because
of projected increases for its defense and energy R&D portfolios,
DOE's Office of Science would see its budget fall 2.4 percent or
$81 million in FY 2006 following a proposed cut in FY 2005. The
Office of Science would see its R&D budget fall 5.4 percent in just
two years after adjusting for inflation.
- Other R&D funding agencies would see further cuts in FY 2006
following proposed cuts in FY 2005. R&D in the U.S. Department of
Agriculture (USDA, down 8.3 percent over two years after inflation),
the Environmental Protection Agency (EPA; down 11.6 percent), Commerce's
National Oceanic and Atmospheric Administration (NOAA, down 6.2 percent),
Commerce's National Institute of Standards and Technology (NIST, down
13.8 percent), and the Department of the Interior (down 8.4 percent)
would decline two years in a row, even before inflation.
- Although DOD, DHS, and NASA would see increase every year over the
next five years in their R&D portfolios, some of their programs
would not be as fortunate. DOD would cut its support of "S&T"
(basic and applied research plus technology development) steeply
in FY 2005 and by another percentage point in FY 2006, leaving the DOD
S&T portfolio 18 percent smaller after inflation than in FY 2004.
And while NASA R&D would increase overall in FY 2006 to ramp up
its moon-and-Mars activities, NASA funding for biological and physical
research and earth science would fall steeply in FY 2006.
For details of the outyear projections for FY 2006 and other years,
including tables and charts, see the accompanying AAAS
analysis of the outyear projections in the FY 2005 budget.
to the AAAS Analysis of the Outyear Projections