Leadership in Congress has developed a plan to move all the FY 2026 budget appropriations bills before the end of the month. First up in a “compromise” package that includes, among other agencies, appropriations for the Departments of Commerce, NASA and the National Science Foundation. 1/8/26 UPDATE: The House passed the package today by a vote of 397-28. Instructions accompanying the bill provide insights into how Congress would like to see the agencies use the funding. Selected highlights for the TBED community are provided below.
JAG indirect cost plan model is worthy of “further consideration”
The CJS appropriations report singles out the Financial Accountability in Research (FAIR) model as “meriting further consideration.” Developed by the Joint Associations Group on Indirect Costs (JAG), FAIR proposes adding transparency to how indirect costs are calculated for institutions of higher education that receive federal funding. JAG membership includes Association of American Universities (AAU), Association of Public and Land-Grant Universities (APLU), Association of American Medical Colleges (AAMC), American Council on Education (ACE), Association of Independent Research Institutes (AIRI), Council on Governmental Relations (COGR), National Association of Independent Colleges and Universities (NAICU), and American Association of State Colleges and Universities. The U.S. Court of Appeals has barred the Administration’s attempt to unilaterally cap indirect rates on NIH awards.
Build 2 Scale to receive another $50 million
The Regional Innovation Program, commonly known as Build 2 Scale, is to receive an additional $50 million, level funding from the FY 24 appropriation and again in the FY 25 continuing resolution. Speculation is that all $150 million will be available for the next Notice of Funding Opportunity, expected this spring. External observers anticipate the program will go through some modifications, given the larger funding pool (appetite for much larger awards, anyone?)
Tiny Tech Hubs appropriation is viewed as flat funding
Technicalities within the Congressional budgeting process have created an appropriations problem for the popular Regional Technology and Innovation Hubs program. Only $41 million for the program—authorized at $10 billion over 10 years—is appropriated again, and is the same annual amount allotted through direct line-item appropriations since the program was started a few years ago. Much larger funding to capitalize the first 12 hubs was secured through special acts. For the round of new Tech Hubs under consideration, the funding pool will be created by an anticipated spectrum sale. As a result, increasing the Tech Hub funding level within the regular budgeting process to an amount closer to what Congress originally intended in the authorization would require either a bump-up inthe CJS spending level or potentially unpopular cuts to other line items within the bill.
$212 million slotted for MEP and Manufacturing USA
The language accompanying the Manufacturing Extension Program appropriation holds back little in expressing Congress’s support for the program. “In recognition of strong bicameral and bipartisan Congressional support, the agreement continues strong support for the MEP program and provides $175 million.” Congress further bars NIST/Commerce from reducing the number of active MEP centers across the country and “under the same terms and conditions as were required in fiscal year 2024.” A minimum of 85% of the allocation must be awarded to MEP centers.
NASA encouraged to maintain the SBIR program despite the lapse in authorization
“The agreement encourages NASA to continue to obligate not less than 3.2 percent of its annual extramural research and development budget through awards to small businesses despite the current lapse in Small Business Innovation Research (SBIR) authorization. If new SBIR or Small Business Technology Transfer authorization legislation is enacted that modifies the mandated level of support for small businesses, NASA shall ensure that it adheres to that new level.”
NSF to receive $8.75 billion, to be distributed “equitably”
The figure is $310 million less than FY 2025 enacted levels but $4.8 billion higher than the Administration requested. The $7.1765 billion allocated for research and research-related activities is to be distributed across all of the basic research directorates and the Technology, Innovation and Partnerships Directorate. Spending reductions in any directorate may not exceed 5% relative to the FY24 enacted level.
NSF EPSCoR tagged for $250 million; HBCUs $25 million; Regional Engines “no more than $200 million;” STEM education cut $327 million
While the budget language sets a maximum threshold for the Engines program, rather than a minimum, the $200 million for Engines is nearly four times what is available for EDA’s Tech Hubs and should allow NSF to proceed with funding some of the current round of Engine finalists.
42 pages of Congressionally directed spending items
Earmarks return to the CJS appropriations, including approximately 250 attached to NIST for research, innovation and STEM education activities at universities and colleges across the country. Another three dozen, mostly for STEM education and research, are attached to the NASA appropriations.