Congress made rapid progress on appropriations in June and July following a late start, but there’s still a long way to go, with some major decisions yet to be made – including what to do about science and technology (S&T) funding. With the House heading into the annual August recess and the Senate soon to follow, here’s a look at how things have shaped up, and where they might go.
The Current Picture: Science and Technology Under Constraint
Certainly, the White House has seen Congress largely ignore its calls for historic reductions to federal science and technology programs. According to rough (very rough) AAAS estimates, current House appropriations would increase federal R&D by 4.8 percent or $7.6 billion above FY 2017 omnibus estimates, with basic and applied research increasing by about 2.5 percent each, slightly ahead of inflation; development spending would grow by even more thanks to large boosts for Department of Defense development activities (see graph at right).
While House appropriators have moved their full set of twelve annual spending bills through committee, their Senate counterparts still haven’t introduced several of their own, but the legislation they have produced so far has generally topped the House numbers. Missing Senate legislation includes annual bills to fund the National Institutes of Health (NIH) and the Department of Defense (DOD), the two largest funders of R&D in government. It’s worth noting that Senate appropriators were more generous for both agencies at this point in last year’s appropriations.
Even so, the FY 2018 funding cycle has been rather mixed for S&T on the whole, with many more agencies looking at reductions than increases at this point (see graph at right; see also the AAAS Appropriations Dashboard). In the House, the increases for research cited above are almost entirely a function of boosts for just a few large agencies: NIH, NASA, and the National Nuclear Security Administration (NNSA). Most other research programs are flat or declining, in some instances substantially, as seen in the graph. It’s been a similar story in the Senate, where a handful of Department of Energy (DOE) offices – including NNSA, the Office of Science, and the beleaguered ARPA-E – are among the few boosts so far. Veterans medical research is one of the few areas that's done well in both chambers.
The biggest motivators for constrained funding are the caps on discretionary spending, which have been in place since Congress adopted the Budget Control Act in 2011. While Congress has raised the caps on multiple occasions through multiple deals, in FY 2018 the most recent deal runs out. Barring a change, discretionary spending – including both defense and nondefense, capped separately – will drop by about a half a percentage point in FY 2018, down to sequestration levels for the first time ever (see graph). As we predicted almost two years ago, this is a recipe for a tight funding year.
Not that appropriators have been willing to go along with current law as it's written: both the House and the Senate have adopted funding strategies that would run afoul of the caps in FY 2018. Senate appropriators have simply ignored the scheduled cap decline, keeping overall spending at FY 2017 levels when writing their funding legislation. The House has gotten a bit more creative, recommending a further modest reduction in nondefense spending while substantially increasing the defense budget (more on this below).
Both of these scenarios would breach the FY 2018 spending caps in some fashion: the House would breach the defense cap, while the Senate would breach both the defense and nondefense caps. If that were to happen, it would trigger an actual sequestration: automatic across-the-board spending cuts to push agency budgets back within allowable levels, similar to what happened in FY 2013.
The bottom line is that much of what Congress has produced is not workable under current law.
Congressional Choices: Basic Science vs Mission Science
When spending is tight, and the size of individual spending bills are constrained or shrinking (see the Senate’s bill allocations, for example), it forces legislators to prioritize, and that can crystalize preferences. One thing that’s evident in this year’s appropriations is continuing division over applied or mission-driven research and technology, owing to different ideas about the appropriate roles of government and the private sector, and greater willingness to fund basic or discovery science, which are seen to be more appropriately in government's purview.
Every subcommittee has its own nuances and preferences, but the major agencies recognized as basic science funders have fared marginally better as a group. These generally include NIH, NASA, the National Science Foundation (NSF), and the Office of Science within the Department of Energy (DOE), as well as certain smaller offices and programs. On the other end of the spectrum are use-oriented programs with missions focused on conservation, regulation, commercial technology, or manufacturing productivity with a more applied nature, like EPA or DOE’s technology programs. Such distinctions are even present within specific agencies and offices. For instance, within the National Institute of Standards and Technology (NIST), industrial programs have been more of a target compared to NIST’s lab research programs.
As can be seen in the current appropriations chart above and in the AAAS appropriations dashboard, these tendencies are generally more evident in the House, where the majority party has greater power and conservatives skeptical of federal interventions hold more sway. In the House, for example, appropriators flat-funded DOE’s basic science arm while simultaneously attempting to zero out its technology-oriented innovation hubs. Those programs were restored on the House floor.
None of this is new. The graph at right illustrates changes in program spending since 2010, with programs associated with discovery science in blue, and applied programs in shades of orange. It’s apparent that discovery science programs have tended to do somewhat better since spending began declining after FY 2010; it's a similar pattern for other programs not shown here. Reinvigorating this debate over government’s role, which dates from the Reagan Administration and earlier, might be the Trump Administration’s most consequential influence on science appropriations: even as the White House’s funding plan has been largely opposed, it has given like-minded legislators the chance to take another look at where to draw the boundaries.
Where Do We Go From Here? And Did Anyone Bring a Map?
While Congress has started coloring in the appropriations picture, there’s still quite a bit to be determined, with the end of the fiscal year looming September 30.
The biggest question, of course, is what happens with the spending caps. As mentioned above, the House and Senate have taken rather different approaches here. The House budget – which House appropriators have kept in mind when marking up their legislation – basically takes the Trump Administration request and adds funding on top of it. For FY 2018, House budgeteers would trim nondefense spending by an additional $5 billion below the scheduled cap, while boosting base defense spending by $73 billion (see nondefense graph at right, and defense graph here). But this is not a budget that’s likely to pass the Senate, where appropriators have opted to hold at FY 2017 levels.
Again, neither of these approaches fits within current law, and each would trigger a sequestration to force discretionary spending within the caps. That means Congress will have to come up with another deal (which would be number four and counting) to change the caps, if it wants to enact the legislation it's written thus far. And such a deal would require 60 votes in the Senate, which means Democrats and Republicans would have to work together. There are several different moving parts here:
- Defense hawks want to see the defense budget grow, and could accept an increase in nondefense spending to obtain it; however, Congress also has the option of using overseas war funding to get around the defense cap;
- Senate Democrats have advocated for increases to defense and nondefense spending, and their consent will be required on any deal; part of that consent will likely require equal increases for defense and nondefense spending, which has been a core principle since the caps were put in place;
- Moderate Republicans in the House have expressed opposition to the House budget so far;
- Fiscal conservatives have actually signaled they could accept higher discretionary spending, but it would have to come with real tax reform and cuts to mandatory spending, which makes up the bulk of the federal budget.
Many legislators are unhappy enough with the status quo to be pushed to the negotiating table, but as always, the outcomes are contingent on what everyone is willing to give up. For instance, border wall funding could turn off Democrats, while failure on tax reform could be disincentive for Republicans to sign off on a deal. And the return of the debt ceiling as an issue also complicates things.
If Congress does reach a deal and the caps go up, then odds are good many programs will see some additional funding. For instance, Rep. John Culberson (R-TX), chair of the House subcommittee responsible for NSF funding, has said the basic science agency is “at the top of my list” should more funding come available. One might expect his Senate counterpart, Sen. Richard Shelby (R-AL), to go to bat for NASA. Also in the Senate, several influential Republicans are strong supporters of DOE science and technology programs, including ARPA-E, and would presumably push for increases there.
The last time Congress was in this position and reached a deal, nearly every science and technology program received a bit of extra funding on top of what the House and Senate had provided.
The biggest X-factor of all is the White House, and specifically President Trump’s veto pen. The President would have the power to veto any spending deals or appropriations packages that come across his desk (subject to a Congressional override), and tweeted in May that the country needs a shutdown. The White House reaction may depend on how many policy victories they feel they've achieved elsewhere, and how much they want to stir the pot.
Regarding timing, Congress only has a few legislative weeks between the August recess and the end of the fiscal year. The Senate and House might be able to make some further progress on appropriations in September, but Congress will likely have to opt for another continuing resolution to avoid a shutdown, and make a run at a spending deal and final appropriations later in the fall – and hope the President signs both.
 There are more issues than usual with this year’s funding figures. First, there are no reliable R&D estimates from official sources for FY 2017, as the agencies simply generated R&D estimates under an assumed full-year continuing resolution – a consequence of very late FY 2017 appropriations. As a result, we’ve had to rely on our own unofficial estimates of R&D in the FY 2017 omnibus for that year. In addition, NASA, DOD, and the Department of Energy adopted definitional changes in their R&D accounting such that certain activities no longer fall under the definition of “development” in FY 2018, which means our estimates likely undercount the increase for development and total R&D in current appropriations. Lastly, House appropriators have included $2 billion in unspecified DOD R&D funding, dubbed a National Defense Restoration Fund, to be used at the Secretary’s discretion. This funding could be allocated by the Secretary to any or all DOD R&D programs, but there is no way at this point to predict that allocation among basic, applied, or development.
 Of course, there are other factors in play beyond this basic ideological difference. For instance, NIH is further helped by its focus on life sciences and human health, while energy technology programs are subject to the regional influences of energy politics.