AAAS R&D Funding Update September 21, 2000 -
September Progress Report on R&D in FY 2001 House and Senate Appropriations

Federal R&D Headed for Increases, but
Most Budgets are Unfinished

Go to: Table 1. Total R&D by Agency (Senate Action as of 9/21) Table 2. Total R&D by Agency (House Action as of 9/21) Table 3. "21st Century Research Fund" by Agency (House and Senate Action as of 9/21) Table 4. Estimated Research by Agency (Senate Action as of 9/21) 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-Senate Conference Reports: Department of Defense AAAS R&D Funding Updates for FY 2001 Senate 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 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 and Senate appropriations so far in the budget process, and summarizes the AAAS R&D Funding Updates released so far. This updates previous progress reports from August 1 and June 26. 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.) Less than ten days remain before the October 1 start of fiscal year (FY) 2001, but Congress and President Clinton are still far from agreement on FY 2001 appropriations for the federal government's discretionary programs, out of which nearly all federal support of research and development (R&D) is funded. Of the 13 appropriations bills covering discretionary programs, only 2 have been signed into law and the remaining 11 are a long way from completion. Only one major R&D funding agency, the Department of Defense (DOD), has received its final appropriations, but it appears that federal R&D is headed toward a banner year in FY 2001 because of final or nearly-final increases for R&D in DOD and the National Institutes of Health (NIH). Funding levels for nondefense, non-NIH R&D programs, however, remain uncertain, and the fate of many R&D programs will be decided in frantic, closed-door budget negotiations in the coming weeks. FY 2001 R&D in House and Senate Appropriations Last week, the Senate finished drafting its versions of all 13 appropriations bills. Nine of them have been approved by the full Senate, while the remaining four must still be debated, amended, and approved by the full Senate before they can go to House-Senate conference. (The House has drafted and approved its versions of all 13 appropriations bills.) The Senate bills would be extremely generous to most R&D programs, and would provide substantial increases for key parts of the federal R&D portfolio. A few programs, however, would fall short of the President's request and would see their funding decline in some cases. For most programs, the Senate bills would be far more generous than the House bills. The House would cut steeply into non-NIH nondefense R&D programs and would cut many of the Clinton Administration's top R&D priorities. Except for DOD, the funding levels discussed below and in the tables are only proposed levels, and are not final. (For details on individual agency appropriations, please see the agency R&D Funding Updates on the AAAS R&D Web site, follow the links in the left column, or click on the linked agency names below). The Senate would provide substantial increases to federal R&D for most agencies, and would also exceed the President's request overall (see Figure 1). Under the Senate bills, total R&D would increase by 7.8 percent or $6.5 billion to almost $90 billion (see Table 1). Most of this tremendous increase is either final or nearly so. In August, President Clinton signed into law a 6.8 percent or $2.7 billion increase for DOD R&D to $41.9 billion, including a 13 percent increase in DOD's support of basic research and an 8 percent increase in applied research. The Senate proposed a 15 percent or $2.7 billion increase to the NIH budget, and a House-Senate conference committee has tentatively agreed to make the Senate figure final. Other agencies slated for large increases in R&D in the Senate versions of their appropriations include the Department of Energy (DOE; up 7.7 percent to $7.7 billion), the National Science Foundation (NSF; up 9.5 percent to $3.1 billion), the U.S. Department of Agriculture (USDA; up 7.0 percent to $1.9 billion), and the Department of Transportation (DOT; up 13.1 percent to $686 million). Figure 1. (click on image for a full-size PDF version of this chart) A few R&D programs would see their budgets decline or fall short of requested increases in the Senate bills, mostly because tight constraints on domestic discretionary spending forced Senate appropriators to make tough choices between competing priorities. These funding levels could increase in the final appropriations bills. Although DOE R&D overall would increase substantially in the Senate plan, some science programs would face declining budgets. Funding for high-energy physics, nuclear physics, and fusion energy sciences research would all fall in the Senate plan. Department of the Interior R&D would decline slightly to $571 million, in contrast to a requested increase to $590 million. R&D in the Department of Commerce would fall 2.7 percent to $1.0 billion. Although the 9.5 percent increase in NSF's R&D would be a substantial one, the Senate appropriation would fall short of the nearly 20 percent increase requested by President Clinton and would curtail NSF's planned participation in the nanotechnology initiative from a requested $217 million down to $125 million. The House would be far less generous to nondefense R&D than the Senate, and would cut R&D funding for many agencies (see Figure 2). Although the House joined with the Senate in agreeing to substantial increases for DOD and NIH, nondefense R&D excluding NIH would decline 1.3 percent in the House appropriations bills (see Table 2). Although the House would award a slight 3.9 percent increase to NSF R&D to $3.0 billion, this would be far short of the nearly 20 percent increase requested by the President. The House would cut NASA R&D by 1.0 percent, mostly because it would eliminate the Reusable Launch Vehicle program. Commerce R&D would fall by nearly a quarter because the House would eliminate the Advanced Technology Program and slash NOAA R&D. USDA R&D would decline 2.0 percent because the House would prevent a mandatory competitive grants program from spending any money in FY 2001 and would cut other competitive research grants. While DOE R&D would edge up slightly by 0.7 percent, the House would balance increases for DOE's defense R&D activities with sharp cuts in nondefense energy-related R&D activities and stagnant funding for science programs. Figure 2. (click on image for a full-size PDF version of this chart) Nondefense R&D would do well under the Senate plan, rising 8.5 percent or $3.5 billion to $44.2 billion. Even excluding the 15 percent increase for NIH R&D, nondefense R&D would be up 3.6 percent. Although the Senate would fall short of the President's request for R&D agencies such as NSF, NASA, and Commerce, and for key science programs in DOE, the Senate funding levels would be far above the House's proposed cuts to non-NIH nondefense R&D. In the final budget negotiations, it is likely that funding levels for these agencies will move closer to the requested levels. Basic and applied research would each increase by more than 10 percent in the Senate bills (see Table 4). Basic research would increase by nearly $2 billion (10.2 percent) to $20.9 billion because of large increases for NIH, DOD, and NSF. DOE basic research would decline, however, because of Senate-proposed cuts to physics and fusion programs. NASA basic research would decline because of a planned agency shift from basic to applied research. Including applied research, the total federal research portfolio would expand by 10.7 percent to reach $40.5 billion, with substantial increases for nearly all agencies. Research would rise only modestly under the House bills because of the House's smaller proposed increases for NIH and NSF, and cuts in most other nondefense R&D agencies. The "21st Century Research Fund" would rise by 10.0 percent in the Senate plan to $44.0 billion, and 3.6 percent in the House plan (see Table 3). Most of this increase is due to the Senate's proposed $2.7 billion increase to the total NIH budget, although the Senate would award increases to nearly all programs in the Fund. The Clinton Administration created the 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 federal R&D portfolio (primarily in development). Outlook for the Weeks Ahead FY 2001 starts on October 1 but the 106th Congress and President Clinton will not complete work on FY 2001 appropriations by then. Although Congress is desperate to complete all its work by October 6 or 13 so that it can adjourn and hit the campaign trail for the November elections, only 2 of the 13 appropriations bills have been signed into law. The two bills signed into law cover defense spending, leaving the final budgets for domestic programs, including federal funding for nondefense R&D, undecided. Earlier this year, Congress promised to hold the line on discretionary spending by providing far less overall for domestic programs than the President had proposed, and wrote House and Senate bills meeting this goal. President Clinton responded by threatening to veto nearly all of the House and Senate bills. In addition to his veto power, President Clinton has unusually strong leverage in this year's budget negotiations because he is not running for re-election, while congressional leaders are aware that party control of both chambers of Congress is up for grabs in November. As a result, congressional resolve to cut domestic spending has crumbled. It is now clear that in the final spending bills Congress will have to approve funding levels far higher than its original proposals in order to avoid the President's veto. In fact, Congress is now likely to approve funding levels that are close to or even above the President's requested levels. In the next few weeks, Congress will attempt to conclude House-Senate conferences on as many appropriations bills as possible, and has begun to add billions of dollars to the original House and Senate bills to get the final funding totals closer to the President's request. Adding money to the bills to win the President's signature, however, carries the risk of alienating fiscally conservative Republicans who are determined to restrain government spending. Because Republicans hold only a 5-vote majority in each chamber and congressional Democrats are in no mood to help the majority complete its work, as few as five Republican dissenters could halt progress on the bills. Crafting the final bills with fiscal conservatives demanding less money on one side and the President demanding more money on the other side has become a nearly impossible task for appropriators, and has led to delays for some bills and outright failure for others. After October 1, Congress will pass temporary spending bills to keep government programs running until its work is complete. Because of the extreme difficulty in getting acceptable final bills individually to the President, it is now nearly certain that several appropriations bills will be bundled together into a single omnibus appropriations bill that will be the 106th Congress' last piece of legislation. As in past years, this omnibus bill will likely be negotiated in frantic, late-night negotiations behind closed doors between the White House, congressional appropriators, and the congressional leadership, and the bill will emerge in print just hours before the House and Senate are asked to vote on it. As in past years, in an omnibus scenario it is likely that Congress will agree to almost everything the President has requested, and Congress will feel compelled to approve it as the price for getting out of Washington. Yet another scenario has emerged in the past few days, that Congress will adjourn in early October even if appropriations are unfinished, and then come back in November after the election to complete work. This scenario would add additional unpredictability to the final appropriations levels, but even a lame-duck Congress would still face the President's veto and his pressure to add money to appropriations. It seems likely, then, that FY 2001 will be a banner year not only for DOD and NIH, but for the broad portfolio of federal R&D programs. Getting there, however, will not be an easy task, and in the coming appropriations battles there is no guarantee that all programs will share in the expected bounty. - September 21, 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
Senate Action on R&D in the FY 2001 Budget (as of September 21)
(budget authority in millions of dollars)

Table 2. Total R&D by Agency
House Action on R&D in the FY 2001 Budget (as of September 21)
(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.
* - FY 2001 DOD figures are based on the Defense House-Senate conference report, and are final.
September 21, 2000 - House-approved appropriations as of September 21. FY 2001 House figures reflect floor amendments.
All appropriations (except DOD) may change in House-Senate conference.

Table 3. "21st Century Research Fund" by Agency
House and Senate Action on R&D in the FY 2001 Budget (as of September 21)
(budget authority in millions of dollars)

Table 4. Estimated Research by Agency
Senate Action on R&D in the FY 2001 Budget (as of September 21)
(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.
* - FY 2001 DOD figures are based on the Defense House-Senate conference report, and are final.
September 21, 2000 - Senate Appropriations Committee-approved or Senate-approved appropriations as of September 21.
Senate-approved figures reflect floor amendments.
All appropriations (except DOD) may change on the Senate floor or in House-Senate conference.