federal budget

Both the House and Senate are beginning the appropriations process for FY 2019 this month, and early indicators suggest that EDA’s Regional Innovation Strategies program could see an increase over its $21 million for FY 2018.

In the immediate aftermath of the FY 2018 federal budget deal’s announcement, SSTI covered the increased funding for a few key programs, including Regional Innovation Strategies ($21 million) and the National Science Foundation ($7.5 billion). Today we reveal our full analysis covering several new funding line items and substantial funding increases for regional innovation organizations to consider.

With final passage and signage pending at the time of publication, the federal budget for FY 2018 provides relatively strong support for innovation economies. The Regional Innovation Strategies program is funded at $21 million, MEP at $140 million and the National Science Foundation at $7.8 billion, increases for all organizations. Other notable innovation programs receiving at least level funding are SBA’s cluster and accelerator programs, DOE’s ARPA-E, NASA science and the National Institutes of Health. Numerous stakeholders weighed in with Congress to preserve these priorities over the administration’s FY 2018 request — and FY 2019 faces the same challenges.
 

The White House released a budget this week that would substantially reduce federal spending for innovation and entrepreneurship. Regional Innovation Strategies and the entire Economic Development Administration, Manufacturing Extension Partnership, Advanced Research Projects Agency – Energy, Innovative Technology and Advanced Vehicles loan programs, Growth Accelerator Program and Regional Innovation Clusters would all be eliminated. Only in an addendum related to last week’s budget deal does the administration suggest funding workforce and several agencies’ R&D at or near FY 2017 levels. Still, whereas the previous two budgets featured nearly-universal cuts to non-defense initiatives, the FY 2019 budget provides better insights into the administration’s priorities.

Senate Appropriations subcommittees have advanced the remaining FY 2018 departmental budgets: Defense, Homeland Security, Interior, and Financial Services. Unlike the House’s proposal, the Senate would largely maintain FY 2017’s innovation funding. Highlights include level funding for SBA’s entrepreneurial programs — with $6 million for clusters initiatives and $2 million for accelerators — and level funding for the CDFI Fund. Science and Technology funding, while above the administration's request, would decrease by about 8.6 percent for Homeland Security while Defense would see a small increase for applied research but an overall 0.5 percent decrease, according to the American Institute of Physics.

Over the past week, the U.S. Senate Committee on Appropriations has passed bills to fund commerce and science, transportation, energy and water and agriculture. Regional Innovation Strategies would be funded at $21 million, an increase of $4 million over FY 2017. Other innovation proposals received mixed support, as the Senate cut $3.2 billion from commerce, justice and science funding and another $400 million from agriculture.

When SSTI learned that the House commerce appropriations subcommittee’s draft FY 2018 bill did not specifically fund the Regional Innovation Strategies (RIS) program, we called on members to contact the full committee and ask that the bill designate funding for RIS. Thanks to the quick action of SSTI members, the House Appropriations Committee passed the bill last week with level RIS funding of $17 million for FY 2018. Congressional staff specifically said this change resulted from members of Congress who expressed concerns to the committee at the request of their constituents. This is an important win for the program that will allow it to continue funding regional initiatives to spur the transformation of research and innovations into successful products and businesses, but is just one step in the FY 2018 appropriations process. Next, the bill will go to the floor of the House, and the Senate will draft and consider its own bill soon. Eventually, the chambers will need to come to agreement on FY 2018 funding. Help SSTI ensure continued success by joining the Innovation Advocacy Council today: contact SSTI for more information (contactus@ssti.org | 614-901-1690).

The White House Office of Management and Budget sent a letter directing all agency heads to prepare FY 2019 budget requests with the figures provided in the administration’s FY 2018 request. Because the long-term budget provided few year-over-year changes for science or innovation, the administration will therefore again propose to eliminate Regional Innovation Strategies, the Manufacturing Extension Partnership, much of the SBA’s entrepreneurial development funding and other innovation programs, while also making deep cuts to many R&D initiatives. Read SSTI’s full coverage of the administration’s FY 2018 budget request for more information.

The House Appropriations Committee began releasing FY 2018 “markup” budget bills this week, and the proposals would cut billions in non-defense spending. EDA would lose $100 million* in funding, SBA’s entrepreneurial development programs would lose $34 million, NIST’s Manufacturing Extension Partnership would lose $30 million, and Energy’s ARPA-E would be eliminated, among other cuts. As SSTI noted for both the administration’s proposed FY 2017 and FY 2018 budgets, congressional statements rejecting the president’s total budget package did not necessarily make innovation safe.

The president’s budget for FY 2018 would eliminate funding for numerous innovation programs, slash spending on R&D and technology transfer and limit education and training opportunities. The full budget proposal may well be “dead on arrival” in Congress, but this is not the same as Congress rejecting each budget proposal. These cuts threaten America’s long-term economic, medical and security interests — described by WIRED as “science insurance” — but cuts to Medicaid and Meals-on-Wheels will continue to receive the bulk of national attention. If federal spending for science, technology, innovation and entrepreneurship is to remain a national priority, the best — and likely, only — advocates will be the practitioners, researchers, investors and entrepreneurs who experience these initiatives on a daily basis. In short: you.