Congress Endorses Competitiveness Increases,Adds Funds for Biomedical, Environmental and Energy R&D in 2008

(This report is a summary of AAAS estimates and analyses of federal R&D appropriations in the FY 2008 appropriations process as of the August congressional recess.)

As of the August congressional recess, Congress is poised to add billions of dollars to proposed budgets for the federal investment in research and development (R&D) for fiscal year (FY) 2008. The House and Senate would endorse large proposed increases for select physical sciences agencies in the President’s American Competitiveness Initiative (ACI) and would continue to support Administration plans to expand development investments for new human spacecraft. But instead of cutting funding for other R&D programs as requested, the House and the Senate would provide increases to every major nondefense R&D funding agency, and would turn proposed cuts into significant increases for the congressional priorities of biomedical research, environmental research (particularly climate change research), and energy R&D. The added billions in FY 2008 appropriations so far would turn a requested cut in federal support of basic and applied research into a real increase, after three years of decline. But these increases depend on an overall congressional budget plan allocating $21 billion more for domestic appropriations than the President’s budget; because the President has threatened to veto any appropriations bills that exceed his budget request, these R&D increases could disappear or diminish this fall in negotiations between the President and Congress over final funding levels.


Figure 1. (click on image for PDF)

Highlights So Far of Federal R&D in FY 2008 Appropriations

Before the traditional month-long August congressional recess, the 110th Congress made progress on FY 2008 appropriations, although much remains to be done this fall. The House of Representatives approved all 12 of its FY 2008 appropriations bills. The Senate lagged further behind: although the Senate Appropriations Committee drafted 11 of its 12 bills (all except Department of Defense (DOD) appropriations), the full Senate found time to debate and approve only the one bill for the Department of Homeland Security (DHS), leaving the remaining bills for the fall. With the October 1 start of FY 2008 looming less than four weeks after Congress returns to session, it now appears likely that only one or two bills will make it to President Bush’s desk by the start of FY 2008. Instead, in what is now the usual pattern, Congress will have to pass several stopgap spending bills (continuing resolutions) this fall to allow more time to finalize the remaining appropriations bills, especially if President Bush vetoes several bills as he has threatened to do.

In related news, Congress gave final approval on August 2 to comprehensive innovation legislation, the 21st Century Competitiveness Act of 2007 or America COMPETES Act (HR 2272). As with the ACI for R&D funding, this authorization bill responds to the recent National Academies Rising Above the Gathering Storm report and other reports calling on the U.S. to make a renewed commitment to encouraging science and engineering-based innovation for future U.S. prosperity. The bill addresses most of the non-R&D funding recommendations of the report. It would: create or reauthorize numerous science and math education programs at federal agencies; create a Technology Innovation Program (TIP) to replace the Advanced Technology Program (ATP); create an Advanced Research Projects Agency for Energy (ARPA-E) to fund high-risk, high-reward energy research; and authorize programs to encourage more U.S. students to pursue science and engineering careers. The bill would also authorize but not appropriate continued funding increases for the three ACI agencies.

(This analysis features AAAS estimates of R&D in FY 2008 House and Senate appropriations bills; because the Senate has not drafted a DOD appropriations bill yet, FY 2008 Senate figures reflect FY 2008 Senate appropriations for all agencies except DOD and House appropriations for DOD. All FY 2008 figures (Request, House, and Senate) exclude $2.9 billion in DOD development funds requested as part of the war supplemental; Congress will consider these appropriations in the fall, after which they will be added to the FY 2008 figures. All FY 2007 figures include $1 billion in supplemental appropriations (mostly in DOD) enacted in May as part of the 2007 war supplemental.)

- Congress is poised to add billions of dollars to the federal R&D portfolio in its FY 2008 appropriations bills. The House has approved appropriations bills that would allocate $144.3 billion in 2008 for federal R&D, $4.0 billion more than the President’s budget and $3.2 billion or 2.3 percent more than this year (see Table 1). Although the Senate has not acted on the DOD budget yet, Senate appropriations bills so far would give federal R&D agencies $500 million more than the House, for a potential $3.7 billion or 2.6 percent increase in total R&D (see Table 4). These proposed increases, however, may be reduced in the final versions of the appropriations bills, especially if President Bush vetoes appropriations bills for exceeding his spending targets.

- Congress fully endorses requested increases for the three agencies in the Bush Administration’s American Competitiveness Initiative (ACI). Both the House and the Senate would match or exceed the R&D requests for the National Science Foundation (NSF; up 8.7 percent to $4.9 billion in the House, up 9.1 percent in the Senate), the Department of Energy’s Office of Science (DOE OS; up 16.8 percent to $4.1 billion, up 18 percent in the Senate), and Commerce’s National Institute of Standards and Technology laboratories (NIST; up 13 percent to $420 million; see Tables 1 and 4 and Figure 1).

- Congressional appropriators would reverse proposed cuts in many R&D programs by adding billions of dollars to the budget request, especially for R&D programs in the key congressional priority areas of biomedical research, environmental research (particularly climate change), and energy R&D. The House would add $1 billion to a requested cut in biomedical research at the National Institutes of Health (NIH); although the resulting increase would be a modest 2.4 percent in percentage terms, it would be $668 million above current-year funding for a total of $29.1 billion for NIH R&D (see Table 1 and Figure 1). The Senate would add $1.2 billion, enough for a 3.2 percent increase for NIH R&D over 2007 (see Table 4). Congress would turn steep requested cuts into increases for environmental research programs, including R&D in the U.S. Geological Survey (USGS; up 6.6 percent in the House and 3.0 percent in the Senate), the National Oceanic and Atmospheric Administration (NOAA; up 9.9 percent in the House and 18.1 percent in the Senate), and the Environmental Protection Agency (EPA; up 10.6 percent in the House and 0.9 percent in the Senate). Total environmental R&D, encompassing R&D in the above agencies, would rise 9.2 percent in House plans to $2.3 billion instead of falling 3 percent as requested (see Table 3). In addition, appropriators would boost climate change research in other agency budgets, including targeted boosts for earth observing satellites and supporting research at the National Aeronautics and Space Administration (NASA). And instead of requested cuts to energy R&D in 2008 after a banner year in 2007, Congress would keep increasing DOE energy R&D spending dramatically, by 18.5 percent in the House to $1.8 billion and a staggering 29 percent to $2.0 billion in the Senate for the renewable energy, fossil fuels, and energy conservation programs (see Figure 1).

- The House and the Senate would provide increases for every major R&D funding agency except DOD (see Figure 1), and would add R&D funding to the request for every major agency including DOD. Armed with a congressional budget resolution allocating $21 billion more for domestic appropriations than the President’s request, congressional appropriators would spread the additional dollars throughout the federal R&D portfolio and turn requested cuts into increases for several agencies. So far on the nondefense side, R&D earmarks (congressionally designated, performer-specific projects) would make up one-fifth of the additional dollars, leaving four-fifths of the additional R&D appropriations for core programs.


Figure 2. (click on image for PDF)

- Federal support of basic and applied research would stay ahead of inflation in 2008 after three years of decline if congressional appropriations prevail (see Tables 2 and 5 and Figures 2 and 3). Although the request for 2008 would have continued the recent downward trend in federal research support after peaking in 2004, additional dollars for research programs in both House and Senate appropriations would allow federal research support to increase in real terms. Federal support of research (excluding development and R&D facilities) would increase 3.0 percent to $58.6 billion in House appropriations instead of a requested cut; every major research agency except DOD would increase its support of basic and applied research (see Table 2). In real terms, the House would stay just ahead of the expected 2.4 percent inflation rate (see Figure 2). The Senate would go even higher with a 3.9 percent or $2.2 billion boost for federal research support to $59.1 billion (see Table 5 and Figure 3).


Figure 3. (click on image for PDF)

- Congress would fully support the Administration’s other R&D priorities in the development of new spacecraft and expanded R&D facilities support. The National Aeronautics and Space Administration’s R&D funding would climb $1.2 million or 9.8 percent to $13.0 billion in the House and 8.4 percent to $12.8 billion in the Senate; appropriators would support a 10 percent requested increase to $3.1 billion for development funding of the next generation of human space vehicles. Total development funding would fall behind inflation with a 0.8 percent increase to $80.8 billion (see Figure 2), but will show a large increase this fall when Congress adds in war-related supplemental development funding. In construction of large R&D facilities, Congress would endorse NASA’s proposed 28 percent boost in construction of the International Space Station. Other proposed boosts in R&D facilities funding at DOD, NSF, NIST, and DOE also win congressional support to bring total R&D facilities and large equipment funding to $4.9 billion in both the House and Senate (up 22 percent and 21 percent, respectively; see Tables 1 and 4).

- In a change from past appropriations seasons, defense R&D would fall but nondefense R&D would see big gains. The House would add $2.5 billion on top of a requested increase for nondefense R&D programs for a total of $62.7 billion, a substantial 6.5 percent increase (see Table 3). The Senate would add even more money for a total of $63.2 billion, up 7.3 percent. Defense R&D, however, would fall slightly by 0.7 percent to $81.6 billion in House appropriations (see Table 3), but only because Congress has not yet considered $2.9 billion in requested 2008 war supplemental funds for development programs; later this fall, when Congress approves a war supplemental, the cut will turn into an increase. The House would add $1.7 billion to a $3 billion requested cut in DOD’s “S&T” programs (research plus early technology development), to moderate a 22 percent requested cut into a 10 percent cut.

- Congress has resumed earmarking R&D projects in FY 2008 appropriations, after a one-year moratorium on most nondefense earmarks in 2007. The AAAS analysis of R&D earmarks in FY 2008 appropriations, to be released in August, shows that the House would designate $529 million for congressionally designated performer-specific R&D projects in its FY 2008 bills and the Senate $624 million in its bills (both totals exclude DOD for the moment). Roughly one-fifth of the dollars added to the request for nondefense R&D would be in the form of earmarks. Both the House and Senate totals are in line with 2005 and 2006 earmark levels at the same stages of the appropriations process. Although earmarks appear to be down in nondefense R&D agencies, defense R&D earmarks are expected to reach new highs in 2008, partly because improved disclosure of earmarks this year has made previously hidden earmarks more visible. (For full details see the forthcoming AAAS R&D Funding Update on R&D Earmarks in FY 2008 Appropriations, available in mid-August on the AAAS R&D web site.)

R&D Appropriations for Key Agencies

Detailed analyses of FY 2008 House and Senate appropriations for individual agencies are available in AAAS R&D Funding Updates on the AAAS R&D Web site.


Figure 4. (click on image for PDF)

- Both the House and Senate would add more than a billion dollars to the budget request for the National Institutes of Health (NIH) to turn a cut into an increase. The House would give NIH a total budget of $29.9 billion in 2008, an increase of $701 million or 2.4 percent over the current year that would be $1.0 billion more than the request. The Senate would provide $249 million more than the House to allow NIH a 3.3 percent increase. Because part of the increase would go to a larger transfer to the Global Fund for HIV/AIDS and increased funding for the NIH Common Fund, most NIH institutes and centers (IC’s) would see their budgets increase between 1.5 and 1.7 percent in the House, well short of the 2.4 percent expected economy-wide inflation rate. In the Senate plan, most IC’s would just match inflation with increases between 2.3 and 2.5 percent. But both plans would fall well short of expected biomedical research inflation of 3.7 percent in 2008. NIH R&D spending, 97 percent of the total NIH budget, would grow 2.4 percent in the House and 3.2 percent in the Senate (see Figure 1). Both the House and Senate would require NIH grantees to make their published research papers freely accessible within a year of publication; only the Senate would expand the number of embryonic stem cell lines eligible for NIH funding from the current policy of lines created before August 2001 to those created before June 2007.

- Congressional appropriators would endorse the Bush Administration’s requested increase for the National Science Foundation (NSF) as part of the ACI but would also add significantly to the request for its education programs. The House would give NSF $6.5 billion for its total budget for a 10.0 percent increase, while the Senate would allocate even more. NSF’s R&D investments would total $4.9 billion in both the House and the Senate, up 9 percent (see Figure 1 and Tables 1 and 4), bringing NSF R&D funding to an all-time high in real terms (see Figure 4) after cuts in 2005 and 2006. Most research directorates would receive increase between 4 and 9 percent for the second year in a row. NSF’s Education and Human Resources (E.H.R) budget, after years of steep budget cuts, would soar 18 percent in the House appropriation to $823 million and 22 percent to $851 million in the Senate. Much of the additional funding would go to new programs in science and math education that would be authorized by the innovation bill cleared by Congress; the bill would also authorize future increases in the NSF budget along the ten-year doubling trajectory envisioned by the ACI.