1. The Federal R&D Budget Process 101
Matt Hourihan
March 19, 2018
For the CASE Workshop
AAAS R&D Budget and Policy Program

2. The Federal Budget is Kind Of a Big Deal
Major impact for R&D and innovation: most basic research, and most university research, is federally funded
“Politics is who gets what, when, and how.” - Harold Lasswell
Public dollars are scarce resources
The budget process is ultimately a negotiation between competing interests (and their proxies) in a decentralized system
Budget choices are influenced by many things at every step:
values; politics and political constituencies; power and control; tradeoffs; incrementalism; rules and institutions; and even merit!

3. The Budget Process at a Glance
Executive Branch
Legislative Branch
White House
Budget Committees
Budget Resolution
OMB
Agencies
OSTP
February Budget Request
Appropriations Committees & Subcommittees
SPENDING BILLS (x12)
Timeline is 18 months or more from the start of agency planning to completion of appropriations and start of the fiscal year on October 1, however…
Congress hasn’t gotten appropriations finished on time since 1996

4. Agencies in the Budget Process
Executive Branch
Agency process kicks off 18+ months in advance. Generally:
Developing strategic priorities, objectives (winter/early spring)
Then developing and iterating concrete, detailed program proposals and scenarios (spring/summer)
Often bottom-up in the details: small units  larger units  agency leadership/CFO
Ingredients include:
Agency head and staff judgment
External input from advisory or review committees, workshops or meetings, NAS decadal surveys, Congress, etc.
Incrementalism: last year’s budget influences next year’s
Performance metrics
White House
OMB
Agencies
OSTP

5. The White House in the Budget Process
Executive Branch
OMB = Office of Management and Budget
Spring: Guidance memo to agencies
Fall: Thorough, detailed review of agency budget submissions, followed by “passbacks” and appeals
OMB’s job is to constrain spending
OSTP = Office of Science and Technology Policy
Summer: joint memo with OMB outlining broad S&T priority areas for investment
Advice (with PCAST) and coordination to President, agencies, OMB, NSTC on science investments and strategies
High-level political, spending, or legislative priorities
Negotiation with agencies
Things must wrap in January
This is all truncated in transition years
White House
OMB
Agencies
OSTP

8. Questions…

9. The Budget Process at a Glance
Executive Branch
Legislative Branch
White House
Budget Committees
Budget Resolution
OMB
Agencies
OSTP
February Budget Request
Appropriations Committees & Subcommittees
SPENDING BILLS (x12)
Congress has the Power of the Purse
Does the President’s Budget even matter? Only as much as Congress lets it

10. Appropriations Committees & Subcommittees
The Budget Resolution
Legislative Branch
Established by 1974 CBA
Intended to reassert legislative control
Overall framework:
Revenue, deficit, and total spending targets
Non-binding recommendations
Key for science: discretionary spending limit to govern appropriations
Isn’t law and can’t change law, but can set up reconciliation instructions (i.e. tax reform)
Best seen as a political document as much as a governing document
Partly because it isn’t always adopted…
Budget Committees
Budget Resolution
Appropriations Committees & Subcommittees
SPENDING BILLS (x12)

15. Questions…

16. Enter the Appropriators
Executive Branch
Legislative Branch
White House
Budget Committees
Budget Resolution
OMB
Agencies
OSTP
February Budget Request
Appropriations Committees & Subcommittees
SPENDING BILLS (x12)
Budget resolution discretionary target  spending caps for each appropriations bill
Twelve appropriations subcommittees = twelve spending bills

17. From Budget to Appropriations
Budget Resolution limits  Approps Committees  Subcommittees
These caps remain in place all the way through floor consideration
Led by “Cardinals”
Committee Chairs: Rep. Rodney Frelinghuysen (NJ), Sen. Thad Cochran (MS)
Ranking Members: Rep. Nita Lowey (NY), Sen. Patrick Leahy (VT)
Appropriators will often have their own priorities
“All politics is local”
National needs, merit, ideology, constituent needs, balance and tradeoffs, waste, and good government
“President proposes, Congress disposes”
Key: Getting bills that can pass

18. Energy & Water Subcommittee
House
Senate
Chair
Mike Simpson (ID)
Lamar Alexander (TN)
Ranking Member
Marcy Kaptur (OH)
Dianne Feinstein (CA)
Tradeoffs: Balancing basic research and facilities, labs, tech portfolio, NNSA; also Army Corps, Bureau of Reclamation
NNSA the biggest priority of late
Office of Science: as basic science arm, generally supported
National labs help
Technology programs: Congress tends to fund when funding is available, but can also be first on the chopping block
Some value innovation programs more than others
Regional energy politics and economics
Ideology matters

19. Labor, HHS, Education Subcommittee
House
Senate
Chair
Tom Cole (OK)
Roy Blunt (MO)
Ranking Member
Rosa DeLauro (CT)
Patty Murray (WA)
Deep divisions over public health programs, education, labor
But everybody loves NIH!
We have now had multiple years of multibillion dollar increases
Alzheimer’s, cancer, opioids among the big priorities lately
Congress has so far protected NIH awardees from indirect cost changes
Other programs also have their supporters (BioShield, BARDA, CDC, etc)

20. Commerce, Justice, Science Subcommittee
House
Senate
Chair
John Culberson (TX)
Richard Shelby (AL)
Ranking Member
Jose Serrano (NY)
Jeanne Shaheen (NH)
Tradeoffs: Balancing Justice, Commerce, NASA, NSF; smaller bills this year
NSF: many appropriators still value basic research
Though disciplinary fights and attacks can have their toll
NASA: recent priority, especially popular with current cardinals
Again: labs and research centers help
NOAA and NIST: more controversy but aspects of these agencies do have supporters, often for locally-driven reasons
(i.e. Sea Grant has been protected)

21. The Budget Process at a Glance
Executive Branch
Legislative Branch
White House
Budget Committees
Budget Resolution
OMB
Agencies
OSTP
February Budget Request
Appropriations Committees & Subcommittees
SPENDING BILLS (x12)

22. The Budget Process at a Glance
Executive Branch
Legislative Branch
White House
Budget Committees
Budget Resolution
OMB
Agencies
OSTP
February Budget Request
Appropriations Committees & Subcommittees
SPENDING BILLS (x12)
“Please don’t veto us!”

23. Other Legislative Tools for Spending
Continuing Resolutions
…with depressing regularity
Uncertainty? New starts?
Omnibus
Or minibus, or megabus, or cromnibus, or…
Supplementals
i.e. Zika, Ebola, Hurricane Sandy
Also war funding
Not subject to spending caps

24. The Federal Budget Cycle
Gov’t is usually working on 3 budgets at a time
(However, presidential transitions complicate things)

25. Questions…

26. Looking Ahead
FY 2018: Congress has until March 23 to finalize appropriations
FY 2019: a similar story to 2018 on appropriations?
Won’t see spending bills until after FY 2018 is dealt with
Will probably be less generous than FY 2018 will be because of the caps
Not finalized until late fall given election?
FY 2020: cap negotiations one more time
Who controls Congress next year?
Will widening deficit impact the negotiations?

36. mhouriha@aaas.org 202-326-6607 http://www.aaas.org/rd
For more info…