On February 12, 2018, President Trump delivered his fiscal year (FY) 2019 budget request to Congress. The $4.4 trillion FY 2019 budget comes on the heels of a two-year bipartisan deal that raises spending caps by nearly $300 billion. The administration’s budget proposes defense spending in line with the new limits but shortchanges non-defense spending by about $57 billion.
The President’s budget includes spending cuts to areas important to UW–Madison, such as student aid and university research. However, due to the recent two-year funding agreement Congress will pay even less attention to the President’s budget request this year than most years. Moreover, the spending bills will be crafted by Congress, not President Trump.
The House and Senate are still working to complete FY 2018 spending bills. We expect Congress to pass a final omnibus appropriations bill before March 23, 2018, when the current continuing resolution expires. This final spending bill will set FY 2018 funding levels for all federal departments and agencies.
This document provides an initial high-level summary of some of the agencies and accounts that impact campus. It may be updated as additional materials are released. Please contact our office should you have questions or if you would like additional information. Additionally, please visit our website and follow us on Twitter @UWFedRelations for frequent budget updates.
It is important to remember that the President’s budget request, while an important policy and political marker, is simply a blueprint, or suggestion—Congress has the constitutional authority to write the spending bills that fund the federal government. Both the House and Senate have begun hearings to consider different aspects of the President’s budget. Top administration officials are testifying before Congress and the House and Senate Appropriations Committees will craft the FY 2019 spending bills this summer. Committee consideration of those bills will likely begin even sooner.
III. AGENCY HIGHLIGHTS AND SUMMARY
SMALL BUSINESS INNOVATION RESEARCH (SBIR) PROGRAM
Federal agencies with R&D budgets that exceed $100 million are required to allocate 3.2 percent of their R&D budget to SBIR programs. Federal agencies with SBIR programs include:
- Department of Agriculture
- National Institute of Standards and Technology
- National Oceanic & Atmospheric Administration
- Department of Defense
- Department of Education
- Department of Energy
- Department of Health and Human Services
- Department of Homeland Security
- Department of Transportation
- Environmental Protection Agency
- National Aeronautics and Space Administration
- National Science Foundation
NATIONAL INSTITUTES OF HEALTH (NIH)
The National Institutes for Health fares comparatively well compared to other agencies. It was helped significantly by the recent budget agreement. Prior to the two-year budget deal passed by Congress, NIH was slated for a 27 percent cut, but would now receive $35.5 billion.
The FY 2019 budget will decrease the direct cost of research by capping the percentage of investigator salary that can be paid with grant funds, and by reducing the limit for salaries paid with NIH grant funds from $187,000 to $152,000. This provision would have a significant impact at UW-Madison.
Another provision would limit how much of an investigator’s total salary can be paid by grants to 90 percent. Some scientific groups have supported such efforts to curb faculty from depending entirely on so-called “soft money” for their salary.
The budget does not include the 10 percent cap on NIH facilities and administrative (F&A) costs this year. In its FY 2018 Budget, the Administration proposed reforming NIH’s indirect cost rate methodology to ensure that taxpayer dollars were focused on high-impact research and not administrative overhead. Congress subsequently prohibited NIH from implementing these reforms and, in fact, prohibited any further study or exploration of indirect cost rate reforms at NIH.
The budget includes $750 million for NIH to combat the opioid epidemic that would go in part to a new public-private partnership to find treatments and alternative pain drugs.
The budget would consolidate all GME funding into one program while maintaining the site caps. Additionally, the budget proposes to cut or eliminate all public health training funding, including Title VII and Title VIII (Nursing Workforce Development received $83 million, a $145 million cut).
Within the NIH total, the budget proposes to consolidate the activities of the Agency for Healthcare Research and Quality (AHRQ) within NIH as the National Institute for Research on Safety and Quality (NIRSQ). It also proposes consolidating the National Institute for Occupational Safety and Health (NIOSH), currently administered by the Centers for Disease Control and Prevention, into NIH. The proposal does not include additional funding for these new research mandates.
NATIONAL SCIENCE FOUNDATION (NSF)
The Administration is requesting $7.47 billion for NSF, the same as FY 2017. While NSF did not release budget details, it did issue the following press release. In a statement, Director Córdova said under the FY19 budget “NSF will continue its support for groundbreaking research in the areas of computer science, biology, engineering, geoscience, mathematics, the physical sciences, and the social sciences.”
The budget request for the Research and Related Activities Directorate is $6.2 billion, a $118 million, or 2 percent increase from FY17. The increase for the Research & Related Activities account will allow NSF to invest in priority areas like Advancing NSF’s Big Ideas – bold questions that will drive NSF’s long-term research agenda; implementing agency reforms centered on accelerating focused, cross-disciplinary efforts around two of the NSF Big Ideas – The Future of Work at the Human-Technology Frontier, and Harnessing the Data Revolution; and beginning construction on the Antarctic Infrastructure Modernization for Science project.
The budget requests $873 million for the Education and Human Resources Directorate, a $7 million, or 1 percent decrease from FY17.
The budget also includes $95 million for Major Research Equipment and Facilities Construction, which is $114 million, or 55 percent below FY17. The decrease for the Major Research Equipment & Facilities Construction account is largely due to the support for two new Regional Class Research Vessels.
More details on NSF’s FY 2019 Budget Request will be provided at a later date.
DEPARTMENT OF ENERGY (DOE)
The administration requests $30.6 billion for DOE. DOE Secretary Perry said the budget proposal prioritizes the acceleration of transformative early-stage research and development, with a reliance on the National Labs.
The FY 2019 Budget Request includes $5.4 billion for the Office of Science, the same as FY 2017, to focus on its core mission of conducting cutting edge, early-stage research. Highlights of the Request for Office of Science Programs are below:
- Advanced Scientific Computing Research—$899 million
- Basic Energy Sciences—$1.85 billion
- Biological and Environmental Research—$500 million
- Fusion Energy Sciences—$340 million
- High Energy Physics—$770 million
- Nuclear Physics—$600 million
- Science Laboratory Infrastructure—$127 million
Other Budget Highlights:
- The President’s budget once again proposes eliminating Advanced Research Projects Agency-Energy (ARPA-E).
- Office of Energy Efficiency and Renewable Energy: Requests $696 million for EERE, a $1.3 billion cut from the 2017 enacted level. DOE says EERE funds will focus on early stage R&D energy technologies including new approaches to energy storage beyond current battery technologies.
- Office of Nuclear Energy: Requests $757 million for Nuclear Energy, a $259 million cut from the 2017 enacted level, prioritizing support for advanced manufacturing methods, instrumentation, and reactor technologies, including $54 million for advanced Small Modular Reactor R&D.
- Office of Fossil Energy: Requests $502 million for Fossil Energy R&D, an $81 million increase over the 2017 enacted level.
- National Nuclear Security Administration (NNSA): Requests $15.1 billion for the NNSA, a $2.2 billion increase over the 2017 enacted level.
UNITED STATES DEPARTMENT OF AGRICULTURE (USDA)
The Administration’s FY 2019 budget proposal requests $1.3 billion in discretionary funding for the National Institute of Food and Agriculture (NIFA), including $375 million for the Agriculture and Food Research Initiative (AFRI), while eliminating lower priority programs, and varying slight reductions for capacity programs. Highlights below of proposed changes compared to FY 2017 levels:
- Smith-Lever programs: $299 million ($1 million reduction)
- Hatch Act Funds: $243 million ($1 million reduction)
- McIntire-Stennis: $29 million ($6 million reduction)
- Expanded Food and Nutrition Education Program: $55 million ($13 million reduction)
- AFRI: $375 million (level funding)
- Crop Protection and Pest Management Activities: $25 million ($9 million reduction)
- Food Safety Outreach Program: $5 million (level funding)
- Sustainable Agriculture Research & Education: $19 million ($8 million reduction)
The Budget includes discretionary funding of $1 billion for ARS research programs. The emphasis is on basic research and efforts to support the transfer of research and development products to industry to promote the nation’s economic growth through innovation. The budget includes the proposed termination of lower-priority and extramural research projects and closure of 20 laboratories, locations, or worksites.
DEPARTMENT OF DEFENSE (DOD)
The budget provides $617 billion in base defense funding and $69 million for Overseas Contingency Operations (OCO). This includes a $20 billion shift in funds from OCO to the base budget noted in the FY19 Addendum. The budget provides $2.3 billion for 6.1 basic research, a $6.8 million, or .3 percent reduction from the FY17 funding level. Science and Technology (S&T) is funded at $13.7 billion, reflecting a $331 million or 2.3 percent reduction below FY17.
Defense-wide basic research program would see a slight bump to $708 million while defense-wide 6.2 program would see an increase of $207 million to $1.98 billion.
Defense Advanced Research Projects Agency (DARPA) fares well in the budget, receiving $3.4 billion, a $498.8 million increase from the 2017 enacted level. The administration’s proposal provides $350 million more for DARPA than both House and Senate appropriators did in 2018.
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION (NASA)
The budget provides $19.9 billion for NASA, a $238.7 million, or 1 percent, increase from FY17.
- Aeronautics Research Directorate—the FY19 budget requests $633.9 million, which is a decrease of $26.1 million from FY17.
- Space Technology Directorate—the FY19 budget requests $913 million, which is a 33 percent increase from FY17.
- National Space Grant College and Fellowship Program—the FY19 budget also requests the termination of the Office of Education and its programs and redirects these funds to the exploration missions. The National Space Grant Fellowship Program is funded out of the Office of Education and is presumably slated for termination based on this budget.
DEPARTMENT OF COMMERCE
The administration is requesting $9.8 billion, a $546 million, or 6 percent increase, from the 2017 enacted level for the Department of Commerce. Key budget highlights are below.
NATIONAL INSTITUTE OF STANDARDS AND TECHNOLOGIES (NIST)
The FY 2019 budget request is estimated to be $730 million, but the full NIST budget materials aren’t available yet.
The Manufacturing Extension Program (MEP) is eliminated in the president’s budget request.
NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION (NOAA)
The budget requests $4.56 billion for NOAA. The budget prioritizes development of polar orbiting satellites to sustain robust weather forecasting capabilities. It also provides $450 million for investments in R&D in 2019.
The budget requests $321.7 million Office of Oceanic and Atmospheric Research (OAR), a 37 percent decrease from FY 2017. The request “prioritizes OAR’s core functions and reduces extramural grants.”
There is a $98.6 million request for Climate Research activity, a decrease of $53.9 million, and elimination of the Climate Program Office (CPO). The administration also requests decreases of $8.5 million from Regional Climate Data and Information and $39.8 from Climate Competitive Research to eliminate competitively funded climate research. This will reduce funding for NOAA’s Cooperative Institutes (CIs), universities, NOAA research laboratories and other partners in the area of climate research.
Once again, the budget seeks to eliminate the National Sea Grant College Program and the NOAA Office of Education.
DEPARTMENT OF INTERIOR
GEOLOGICAL SURVEY (USGS)
The USGS budget has been roughly flat for over 15 years (hovering around $1 billion) and the administration proposed $859.7 million in FY 2019, which is a reduction of $218 million, or 20 percent from FY 2017 levels.
Cooperative Research Units and U.S. Geological Survey Water Resources Research Institutes, which received $6.5 million in FY 2017, would be eliminated.
ENVIRONMENTAL PROTECTION AGENCY (EPA)
The budget requests $5.4 billion for the EPA, a $2.8 billion, or 34 percent, decrease from the 2017 enacted level. The budget provides $246 million for EPA to continue R&D activities in support of core mission areas, focusing on air quality, water resources, sustainable communities, chemical safety, and human health risk assessment.
NATIONAL ENDOWMENT FOR THE HUMANITIES (NEH)
The budget proposal would eliminate the NEH and provide $42 million to close the agency. This amount represents the salaries and expenses required to shut down the agency and the amount required to honor pre-existing grant commitments (specifically, matching funds).
NATIONAL ENDOWMENT FOR THE ARTS (NEA)
The budget proposal would eliminate the NEA and provide $29 million for the
expenses necessary to carry out the closure of the NEA and will remain available until expended.
DEPARTMENT OF EDUCATION (ED): STUDENT AID AND HIGHER EDUCATION
The administration is requesting $63.2 billion for the Department of Education, a $3.6 billion, or 5 percent cut, from the 2017 enacted level. The 2019 budget eliminates, consolidates, or reduces funding for 39 discretionary education programs. Higher education programs proposed for elimination include:
- Supplemental Educational Opportunity Grants (SEOG)
- International Education and Foreign Language Studies (Title VI)
- Teacher Quality Partnership (TQP) grants
- Graduate Assistance in Areas of National Need (GAANN)
In addition, the budget would significantly modify several other programs. Specifically, it would:
- Consolidate the Gaining Early Awareness Readiness for Undergraduate Programs (GEAR-UP) into a $950 million revised TRIO state block grant program, a combined cut of $350 million from the 2017 enacted level;
- Reform the Federal Work Study (FWS) program to “support workforce and career-oriented training opportunities for low-income undergraduates;”
- Consolidate five income-driven repayment (IDR) plans into a single plan, which would cap a borrower’s monthly payment at 12.5 percent of discretionary income and allow for forgiveness after 15 years of repayment for undergraduate student debt and 30 years for graduate students.
The budget further proposes to eliminate Public Service Loan Forgiveness (PSLF) and Subsidized Stafford loans for undergraduate students, both of which are also targeted for elimination in the PROSPER Act. These student loan program reforms would cut $203 billion over 10 years. The budget appears to grandfather existing borrowers and students in a current program of study, with the new provisions taking effect on all other loans starting in July 2019.
The budget level funds Pell at $22.5 billion in discretionary funding and maintains the maximum award of $5,920. It also expands Pell recipients’ eligibility to include “high quality, short-term programs that provide students with a credential, certification, or license in an in-demand field.”
- Institute of Education Sciences (IES): Requests $521.6 million, a $97 million cut from 2017 enacted amount, for IES – the research and statistics arm of the Department of Education.
- TEACH Grants: Requests $39.9 million, a $113.4 million cut from the 2017 enacted level for TEACH Grants. The TEACH Grant program awards annual grants of up to $4,000 to students who agree to serve as full-time teachers in mathematics, science, foreign language, bilingual education, special education or reading at a high-need high school for at least four years.
- Office for Civil Rights (OCR): Requests $107.4 million, a $300,000 cut from the 2018 CR level, for OCR. The requested funds would ensure essential program support to resolve complaints of discrimination and ensure that institutions receiving federal student aid are in compliance with civil rights laws.
- The Child Care Means Parents in School Program, which was funded at $15 million in 2017, would see a $35 million increase in funding under the budget request.