1. The Federal R&D Budget: Process and Perspectives
Matt Hourihan
April 3, 2017
For the Catalyzing Advocacy in Science and Engineering (CASE) Workshop
AAAS R&D Budget and Policy Program

2. The Federal Budget is Kind Of a Big Deal
“Politics is who gets what, when, and how.” - Harold Lasswell
“Budgeting is about values, and it’s about choices.” – Rep. Rosa DeLauro
Every dollar in the budget has its claimants!
Negotiation between competing interests (and their proxies) in a decentralized system
Major impact for R&D and innovation: most basic research, and most university research, is federally funded

6. Two Spending Categories: Discretionary vs. Mandatory
Mandatory Spending (aka Direct Spending)
Mostly entitlements, mostly on “autopilot”
Potential for high political sensitivity = “third rail”
New spending requires new legislation from the authorizing committees
Discretionary Spending:
Adjusted annually through appropriations bills via the appropriations committees
Easy (nondefense) targets?
i.e. Sequestration
Vast majority of federal R&D is discretionary

8. Budget Process in Regular Order: Three Years, Four Phases
Phase 4: Execute the fiscal year’s budget (not shown)
Note: different timing in transition year!
Arranged by fiscal year (October to September)

9. The Federal Budget Cycle
Phase 1: Internal agency discussions and planning
Strategic plans, staff retreats, program assessments
OMB is present throughout
Agencies deliver budget justifications to OMB (early fall)

10. One Agency’s R&D Budget
Agency Budgeting
Coordination and Top-Down Guidance
One Agency’s R&D Budget
Decentralized planning and scientific input

11. The Federal Budget Cycle
Phase 2: OMB performs multi-stage review, responds to agencies (“passbacks”)
Agencies and agency heads can and do negotiate
Budget proposals are finalized in January
President presents the proposed budget to Congress early February

14. The Federal Budget Cycle
Phase 3: Congress gets involved
Receives and reacts to President’s budget, holds hearings
Approves budget resolution (simple majority)
Writes and passes appropriations

15. Natural Resources Cmte
House
Budget
Cmte
Natural Resources Cmte
Approps Cmte
Subc on Interior + Env
Subc on Energy + Water
Energy + Commerce Cmte
Senate
Energy and Nat Res Cmte
Env and Pub Works Cmte
And many others…
Also revenue (tax) committees (House Ways and Means, Senate Finance)

16. Natural Resources Cmte
House
Budget
Cmte
Natural Resources Cmte
Approps Cmte
Subc on Interior + Env
Subc on Energy + Water
Energy + Commerce Cmte
Senate
Energy and Nat Res Cmte
Env and Pub Works Cmte
Budget Committees

17. The Budget Resolution Established by 1974 Congressional Budget Act
Overall framework
Discretionary spending
Also revenue, deficit, and total spending targets
Also non-binding recommendations from majority
Isn’t law and can’t change law, but can set up reconciliation instructions
The budget resolution is a political document
(and therefore, often not passed!)

19. Natural Resources Cmte
House
Budget
Cmte
Natural Resources Cmte
Approps Cmte
Subc on Interior + Env
Subc on Energy + Water
Energy + Commerce Cmte
Senate
Energy and Nat Res Cmte
Env and Pub Works Cmte
Appropriations Committees

20. From Budget to Appropriations Committees
Budget Resolution limits  Approps Committees  Subcommittees [302(b) allocations]
These caps remain in place all the way to floor, but can be revised as needed
Twelve Appropriations Subcommittees
Eight subcommittees responsible for at least $1 billion of R&D
Approps 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
“There are three parties: Democrats, Republicans, and appropriators”
“President proposes, Congress disposes”

21. Defense
House
Senate
Chair
Kay Granger (TX)
Thad Cochran (MS)
Ranking Member
Pete Visclosky (IN)
Dick Durbin (IL)
Over $500 billion
Tradeoffs: balancing force modernization, readiness, personnel costs, RDT&E (and medical research)
Offset Strategy?
War funding?

22. Energy & Water ~$40 billion
House
Senate
Chair
Mike Simpson (ID)
Lamar Alexander (TN)
Ranking Member
Marcy Kaptur (OH)
Dianne Feinstein (CA)
~$40 billion
Tradeoffs: Balancing basic research and facilities, DOE technology portfolio, NNSA; also Army Corps, Bureau of Reclamation
Partisan debates over energy technologies (renewables vs. nuclear vs. fossil)
Basic vs. applied? Climate research?

23. Labor, HHS, Education >$150 billion
House
Senate
Chair
Tom Cole (OK)
Roy Blunt (MO)
Ranking Member
Rosa DeLauro (CT)
Patty Murray (WA)
>$150 billion
Deep partisan divisions mean it’s often one of the hardest to pass, thus usually one of the last out of the gate
Everybody likes NIH lately
Especially Alzheimer’s research
Cancer moonshot?

24. Commerce, Justice, Science
House
Senate
Chair
John Culberson (TX)
Richard Shelby (AL)
Ranking Member
Jose Serrano (NY)
Jeanne Shaheen (NH)
~$55 billion
Tradeoffs: Balancing Depts. of Justice and Commerce, NASA, NSF
NSF: social and geo science funding? Facilities?
NASA: planetary exploration, climate research, human spaceflight (and where do we fly?)
Commerce: NOAA climate research and NIST industrial technology programs controversial

25. Agriculture ~$20 billion
House
Senate
Chair
Robert Aderholt (AL)
John Hoeven (ND)
Ranking Member
Sanford Bishop (GA)
Jeff Merkley (OR)
~$20 billion
Funds most USDA (but not Forest Service); also FDA
Balancing between conservation, public assistance, food safety
Research activities often take secondary prominence
Fragmented? Formula funds or competitive grants?
Once a big source of pork via earmarks

26. Interior & Environment
House
Senate
Chair
Ken Calvert (CA)
Lisa Murkowski (AK)
Ranking Member
Betty McCollum (MN)
Tom Udall (NM)
~$30 billion
Includes: Dept. of the Interior, EPA; also Forest Service; small bit goes to NIH
Another divisive bill: environmental protection, land use, emissions regulation, wildfire management and response
Again, science funding tends to take secondary prominence (U.S. Geological Survey, EPA S&T)

27. The Federal Budget Cycle
Approps committees write/approve 12 appropriations bills that can pass
Bills have to pass both chambers
Can be amended (always subject to caps)
Funding changes or policy riders
Differences are resolved in conference committee
Can be filibustered

28. Other Legislative Appropriations Tools
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

29. The Federal Budget Cycle
Gov’t is usually working on 3 budgets at any given time
However, presidential transitions complicate an already-broken process…

30. Looking Ahead
Reception for FY18 proposals (and FY17 proposals) have not been good…
115th Congress seems much less willing than the 97th Congress (Reagan) to meet Administration even halfway
FY17 appropriations: how does Congress wrap things up?
CR until April 28
FY18 budget resolution: Where do the caps end up?
FY18 appropriations: does support continue? How does the basic/applied dichotomy shake out?

42. For more info…