AAAS R&D Funding Update June 26, 2000 -
Summary of R&D in FY 2001 House Appropriations

The House's Hard Choices:
Defense and NIH R&D Up,
But Cuts Loom for Most Nondefense R&D

Go to: Table 1. Total R&D by Agency (House Action as of 6/26) Table 2. Estimated Research by Agency (House Action as of 6/26) Table 3. Major Functional Categories of R&D (House Action as of 6/26) Table 4. "21st Century Research Fund" by Agency (House Action as of 6/26) PDF version of this document Related sites: AAAS Report XXV: Research and Development FY 2001 (President's Request for FY 2001; full text on line) AAAS R&D Funding Updates for FY 2001 House appropriations: Department of Defense National Institutes of Health Department of Energy National Aeronautics and Space Administration National Science Foundation U.S. Department of Agriculture Department of Commerce Department of Transportation Department of the Interior Environmental Protection Agency

(This analysis is a progress report on FY 2001 House appropriations so far in the budget process, and summarizes the AAAS R&D Funding Updates released so far. The complete series of AAAS R&D Funding Updates, including continually updated analyses of R&D by agency in FY 2001 appropriations, is available on the AAAS R&D Web Site (http://www.aaas.org/spp/R&D) in the "FY 2001 R&D" or the "What's New" sections.) As the annual congressional appropriations process goes into full swing on Capitol Hill, the House of Representatives recently finished drafting the FY 2001 appropriations bills covering the major R&D funding agencies. As of June 26, the House has drafted 10 of the 13 appropriations bills and approved 7 of them, while the Senate, which traditionally follows the House in appropriations action, has drafted 8 and approved 5. This record compares favorably with last year, when the House had drafted only 5 bills by the Fourth of July, and the final appropriations bill was not signed into law until Thanksgiving. FY 2001 R&D in House Appropriations The House would provide major increases for defense R&D and would match the Clinton Administration's requested increase for R&D in the National Institutes of Health (NIH). But because the House is working with a total discretionary spending ceiling for nondefense programs that is far below the President's request and even below FY 2000, the House would fall far short of the Administration's request for nearly all nondefense R&D programs and would cut many R&D programs below the FY 2000 funding levels (see Table 1 and Figure 1) even though congressional leaders acknowledge that final FY 2001 appropriations will end up far higher than the current plan. (For details on individual agency appropriations, please see the agency R&D Funding Updates on the AAAS R&D Web site). The House would offer a slight increase to nondefense R&D, but would provide $2 billion less for these programs than the request. So far in the process, nondefense R&D would gain 1.7 percent over FY 2000 for a total of $41.5 billion (see Table 1), primarily because of a $1.1 billion increase for R&D in the National Institutes of Health (NIH; up 6.1 percent to $18.2 billion). Excluding NIH, however, nondefense R&D would actually decline by 1.5 percent because of cuts to many other R&D programs, including cuts to R&D in the National Aeronautics and Space Administration (NASA; down 1.0 percent to $9.7 billion), the U.S. Department of Agriculture (USDA; down 1.9 percent to $1.7 billion), and especially the Department of Commerce (down 24.0 percent to $816 million). The Clinton Administration budget request placed a high priority on a balanced allocation of resources among science and engineering disciplines. Although a series of large increases for the National Institutes of Health (NIH) has resulted in an emphasis on biomedical and life sciences research in recent years, the request proposed large increases for R&D in non-life sciences disciplines, including substantial increases for the National Science Foundation (NSF) and the Department of Energy (DOE). The House appropriations favoring NIH and cutting all other nondefense R&D would go in the opposite direction. Not only would House appropriations result in a cut for non-NIH nondefense R&D, but the House would also fall well short of the requested increases for NSF and DOE: NSF R&D would be up 3.9 percent to $3.0 billion, far short of a requested 20 percent increase. DOE's Science R&D would inch up 1.2 percent to $2.7 billion, compared to a 12.6 percent requested increase. Figure 1. (click on the image to view a full-scale PDF version of the chart) The House would reward defense R&D with substantial increases. Defense R&D would total $44.6 billion in FY 2001 under the House plan, $2.0 billion or 4.7 percent more than FY 2000 and nearly $2.6 billion more than the request. The House would provide a 11.5 percent increase to $1.3 billion for the Department of Defense's (DOD) basic research ("6.1") programs and would boost funding for the "Science and Technology" portion of DOD's budget (encompassing basic and applied research plus exploratory technology development and medical research) to $8.8 billion, nearly $1.2 billion above the request. Despite renewed concerns about nuclear security at DOE weapons laboratories, the House would boost DOE's defense R&D programs by 5.4 percent to $3.5 billion. Basic research in agencies would be up by 4.3 percent to $19.8 billion in the House plan (see Table 2). There would be large increases for basic research in DOD (up 11.5 percent) and NIH (up 6.0 percent to $10.4 billion). Although the Administration requested a nearly 20 percent increase for NSF basic research across the broad range of science and engineering disciplines, the House appropriations would allow for only a 5.5 percent increase to $2.6 billion. Basic research would decline in NASA (down 5.8 percent) and USDA (down 2.7 percent). Table 3 shows House appropriations for R&D by major functional category. The House would award large increases for R&D in defense (up 4.7 percent to $44.6 billion) and health (up 6.0 percent to $19.8 billion, mostly in NIH), but R&D for other national missions would increase only slightly or even decline. The House would cut energy R&D by 14.0 percent to $1.1 billion due to steep cuts in DOE's Fossil Energy and Energy Conservation programs. Commerce-related R&D would fall 39.0 percent to $293 million because the House would eliminate the Advanced Technology Program (ATP). Natural resources and environment R&D would fall 3.9 percent to $2.0 billion because of cuts to most of the agencies that fund such R&D, including the Environmental Protection Agency (EPA), the National Oceanic and Atmospheric Administration (NOAA), and the Department of the Interior. In its budget request, the Clinton Administration presented a "21st Century Research Fund" to highlight programs that it considers important to the nation's science and technology enterprise. The Fund includes both R&D and non-R&D items while excluding large parts of the nation's R&D portfolio (primarily in development). Table 4 shows appropriations for the Fund, which is intended to serve as one indicator of the health of the federal research enterprise in the budget process. The House would increase funding for programs in the Fund by $1.1 billion or 2.7 percent to $41.1 billion, but this would be $1.8 billion short of the request because the House would provide far less than the request for NSF, DOE, NASA, and Commerce. The Senate has lagged behind the Senate in drafting its appropriations bills. The Senate has not yet acted on appropriations for several key R&D funding agencies, including NSF, DOE, NASA, EPA, and Commerce. In appropriations so far, however, the Senate would boost the NIH budget by 15 percent to $20.5 billion, and would nearly match the House's large increases for DOD basic research in particular and DOD R&D in general. Agency Highlights in House Appropriations (The on-line version of this document contains hyperlinks to the AAAS R&D Funding Updates for each of the agencies) The House would boost DOD funding of basic research ("6.1") by $133 million or 11.5 percent to $1.3 billion. Including DOD's medical research programs, DOD S&T would increase by 1.8 percent to $8.8 billion, considerably more than the request of $7.6 billion. The House would appropriate $328 million outside the regular R&D accounts for medical R&D. Total DOD R&D would far exceed both the request and FY 2000 with a total of $41.1 billion, $2.5 billion more than the request and $1.8 billion or 4.6 percent more than FY 2000. The Defense Advanced Research Projects Agency (DARPA) would receive 1.7 percent more than FY 2000 for a total of $1.9 billion, including increases for IT research and biological warfare defense R&D. Missile defense R&D would jump significantly (up 19.9 percent) to $4.1 billion. NIH would receive $18.8 billion in FY 2001, the same as the President's request and an increase of 5.6 percent over FY 2000. NIH would also receive a separate $60 million appropriation for environmental research in the House plan. The House, in an unusual move, stated its strong desire to appropriate even more for NIH for a total of $20.5 billion, and even allocated the extra funds among the institutes, but then inserted legislative language trimming the appropriation back to $18.8 billion because of tight self-imposed funding constraints on domestic spending. The Senate would provide the full $20.5 billion. NIH R&D in the House plan would increase 6.1 percent to $18.2 billion, distributed relatively evenly among the institutes. Because NSF is the only R&D funding agency responsible for the entire range of science and engineering disciplines, with a particular emphasis on fundamental research in non-life sciences disciplines, the budget request singled out NSF as the key agency in the Administration's goal of achieving a more balanced science and engineering portfolio. NSF asked for an unprecedented $675 million or 17.3 percent increase in its total budget to $4.6 billion. But the House would award only a 3.8 percent increase to $4.0 billion. NSF's R&D would increase 3.9 percent, far short of the 19.8 percent requested increase. The Computer and Information Science and Engineering Directorate would receive $439 million for an increase of 13.1 percent, a substantial boost, but this would be far less than the 36.2 percent requested increase. The House would increase funding for DOE's defense R&D programs (up 5.4 percent to $3.5 billion), but would make steep cuts to DOE's energy-related R&D (down 15.0 percent to $1.0 billion) and would hold its science programs nearly even (up 1.2 percent to $2.7 billion) with FY 2000. In the Science account, the House would hold funding for the Spallation Neutron Source to $130 million, the same as FY 2000, instead of the $281 million request. Advanced Scientific Computing Research would increase by 7.1 percent to $137 million, but this would be far below the $182 million that DOE requested to expand the agency's participation in the multi-agency IT R&D initiative. While Solar and Renewable Energy R&D would increase slightly, Fossil Energy R&D would fall 19.2 percent and Energy Conservation R&D would plummet 24.8 percent. Although NASA requested a $435 million increase to the total NASA budget, the House would trim the request and provide NASA with $13.7 billion, just 0.4 percent or $58 million more than FY 2000. NASA's R&D would decline 1.0 percent to $9.7 billion, primarily because steep cuts in the Aero-Space Technology program would reduce the program's budget by nearly a quarter. Strapped for funds, the House would eliminate the Space Launch Initiative instead of making across-the-board cuts. The $290 million request for the program would fund continued development of next-generation launch vehicle technologies. Space Science would receive 8.0 percent more than FY 2000 for a total of $2.4 billion, while Life and Microgravity Sciences and Applications would jump 18.7 percent to $326 million. R&D in the Environmental Protection Agency (EPA) would total $649 million in the House plan, a $3 million or 0.4 percent increase but $23 million below the House request. The House would fund most R&D programs at FY 2000 levels, even those for which EPA requested increases. The House would cut R&D in the Department of Commerce by 24.0 percent or $257 million for a total of only $816 million. R&D in both of Commerce's major R&D funding agencies, the National Oceanic and Atmospheric Administration (NOAA; down 11.8 percent to $522 million) and the National Institute of Standards and Technology (NIST; down 41.0 percent to $270 million) would fall. The House, faced with severe funding constraints in the Commerce-Justice bill, would eliminate the Advanced Technology program, slash funding for NIST's Construction of Research Facilities, and would provide no funds for a proposed Institute for Information Infrastructure Protection (IIIP). NOAA's R&D on oceans, atmosphere, marine resources, and the environment would see across-the-board declines. USDA R&D would decline 1.9 percent to $1.7 billion in the House plan. The House would block a $120 million mandatory competitive research grants program from spending FY 2001 funds, and would cut appropriations for USDA's other competitive grants program from $119 million down to $97 million. At the same time, the House would boost funding for congressionally designated research grants by 16.2 percent to $74 million. In addition, on June 20 President Clinton signed into law a crop insurance bill that contains $51 million in one-time congressionally designated research appropriations for FY 2001. The U.S. Geological Survey (USGS) within the Department of the Interior would receive $817 million for its total budget in the House plan, only slightly above FY 2000. USGS R&D would decline 0.6 percent to $499 million because of severe funding constraints in the House Interior bill. USGS requested a 7.3 percent increase for its R&D programs. Most of the Department of Transportation's (DOT) budget is exempt from limits on discretionary spending affecting other domestic programs because of guaranteed increases in funding for many highway, transit, and aviation programs. As a result, DOT R&D would increase 14.4 percent to $694 million in FY 2001. The big winner would be R&D in the Federal Aviation Administration (FAA), which would benefit from a new aviation law and increasing congressional concern over aviation safety with a 28.5 percent increase in its R&D to $291 million. Policy Context and Budget Outlook Earlier this year, the President requested a total of $622 million for discretionary programs in the federal budget, a 5.2 percent increase over FY 2000. In its FY 2001 budget resolution, however, Congress, limited discretionary spending to only $605 billion, while at the same time increasing defense spending (which accounts for half of discretionary spending) above the President's request in order to demonstrate fiscal discipline and allocate funds for Republican priorities such as tax cuts. As a result, in the congressional plan nondefense discretionary spending in FY 2001 would fall below the FY 2000 level. In writing its appropriations bills, the House is following the budget resolution's spending targets, necessitating cuts to many nondefense programs. The House is thus able to offer substantial increases for defense R&D, but nondefense R&D would feel the squeeze affecting nondefense discretionary overall, with the exception of NIH. As long as Congress sticks to its restrictive spending targets while writing appropriations bills, the totals for nondefense R&D (except for NIH) are likely to remain well short of the request and even short of FY 2000. President Clinton, meanwhile, is prepared to insist on his proposed increases. Already, many of the appropriations bills approved by the House have drawn veto threats from the White House because they fall far short of the President's request not just in R&D but across the broad range of domestic programs. It is widely acknowledged, even by congressional Republicans, that final FY 2001 appropriations will end up closer to the President's requested levels than the restrictive congressional levels. In a repeat of past years' appropriations struggles, President Clinton has strong leverage in this year's budget negotiations because congressional Republicans are desperate to complete appropriations and adjourn well before Election Day in order to have time to campaign. Congress appears ready, as in years past, to give the President billions of dollars in additional spending for the President's priorities in order to win his signature on the appropriations bills, but only after going through the motions of sticking to the budget resolution targets. The acknowledged strategy is to write and approve appropriations bills meeting the targets, thereby meeting many Republicans' demands for fiscal discipline, while at the same time approving tax cut bills outlining Republican priorities. But in the fall, as the bills go to House-Senate conference and then to the President's desk, appropriators plan to add more money to the bills and bring the funding levels closer to requested levels after high-level negotiations between the President and congressional leaders over not only appropriations but also entitlement programs and tax cuts. On June 26, the President released a revised budget forecast that will make the coming budget negotiations far easier. The President's budget office announced that the projected FY 2001 budget surplus, assuming the President's FY 2001 request is enacted, would be a record-breaking $228 billion, up nearly $50 billion from its forecast of just a few months ago. Furthermore, the new forecast predicts a $69 billion surplus even without counting the Social Security surplus, a big jump from the $24 million February forecast. The projected budget surplus for FY 2001 and the even-larger projected surpluses in future years are now so large that they should allow Congress and the President to split their differences by enacting Republican tax cut proposals, the President's Medicare drug benefit proposals, and big increases for discretionary programs, while still allowing the federal government to use all Social Security surpluses to retire the national debt, with some money left over to shore up the Social Security and Medicare trust funds. The new forecast should allow congressional Republicans to raise discretionary spending without sacrificing their tax cuts. President Clinton, meanwhile, has already used the occasion to offer a compromise, promising to sign tax cuts he had previously opposed if Republicans agree to his priorities on discretionary spending and Medicare. The House's restrictive appropriations for R&D programs, already an anomaly in an era of surpluses, are likely to be only the starting point for congressional action on the FY 2001 budget in this era of fiscal plenty. As the budget process goes on, more money will be added to the House's current budget plan and the totals for most nondefense R&D agencies will improve before the appropriations bills are signed into law. (Further AAAS R&D Funding Updates on the AAAS R&D Web site will provide up-to-date information on R&D in FY 2001 appropriations.) - June 26, 2000 AAAS R&D Budget and Policy Program 1200 New York Ave, NW Washington, DC 20005 (202) 326-6607; -6600 science_policy@aaas.org http://www.aaas.org/spp/R&D

Table 1. Total R&D by Agency
House Action on R&D in the FY 2001 Budget (as of June 26, 2000)
(budget authority in millions of dollars)

Table 2. Estimated Research by Agency
House Action on R&D in the FY 2001 Budget (as of June 26)
(budget authority in millions of dollars)

AAAS estimates of basic and applied research in FY 2001 appropriations bills.
All figures are rounded to the nearest million. Changes calculated from unrounded figures.

June 26, 2000 - These figures reflect House-approved appropriations, except for agencies marked with a ( * ).
* - House Appropriations Committee-approved appropriations. These figures may be amended or rejected on the House floor.
AID - The House has not acted on the AID budget. FY 2001 House is the FY 2000 funding level.

Table 3. Major Functional Categories of R&D
House Action on R&D in the FY 2001 Budget (as of June 26)
(budget authority in millions of dollars)

AAAS estimates of R&D in FY 2001 appropriations bills. Includes conduct of R&D and R&D facilities.
All figures are rounded to the nearest million. Changes calculated from unrounded figures.
Classifications generally follow the government's budget function categories except health (which here includes health R&D in HHS and VA).
1 Includes DOD R&D and atomic energy defense R&D in DOE.
2 Includes all R&D not in defense (domestic and international discretionary programs).

June 26, 2000 - These figures reflect House-approved appropriations, except for functions marked with a ( * ).
* - Some programs are House Appropriations Committee-approved appropriations. These figures may be amended or rejected on the House floor.

Table 4. "21st Century Research Fund" by Agency
House Action on R&D in the FY 2001 Budget (as of June 26)
(budget authority in millions of dollars)

Definitions for the 21st Century Research Fund do not correspond to definitions of R&D.
The Fund contains both R&D and non-R&D programs.
AAAS estimates of FY 2001 appropriations bills.
All figures are rounded to the nearest million. Changes calculated from unrounded figures.

June 26, 2000 - These figures reflect House-approved appropriations, except for agencies marked with a ( * ).
* - House Appropriations Committee-approved appropriations. These figures may be amended or rejected on the House floor.