Federal R&D Funding, by Budget Function: Fiscal Years 2017–19
This report contains data on the budget authority provided to U.S. federal agencies to fund the research and development and R&D plant components of their programs in FYs 2017–19. Budget authority is the primary source of legal authorization to enter into obligations that will result in outlays. It is most commonly granted in the form of appropriations by the congressional committees assigned to determine the budget for each function. The technical notes in this report cover the main features of the new R&D budget authority data.
All activities covered by the federal budget, including R&D, are classified into 20 broad functional categories (see “Budget Functions and Classifying R&D”). Currently, R&D activities are present in 15 of the 20 categories.
The data tables in this report provide R&D budget authority detail for FYs 2017–19 by agency and major programs for each of the categories in which R&D is present. Several concluding tables also show budget authority figures for R&D in FY 2016 and earlier years.
The data for FY 2017 are the actual budget authority received by federal agencies for R&D that year. These data update the FY 2017 preliminary data published in the previous edition of this report series.
The data for FY 2018 are preliminary. Normally, these preliminary data would reflect agency estimates based on final congressional appropriations for the fiscal year. Due, however, to the late date at which the FY 2018 spending bill was enacted (Consolidated Appropriations Act, 2018, signed 23 March 2018), most agencies did not prepare R&D estimates based on the enacted spending levels. The FY 2018 data available from the agencies for this report edition reflect, for the most part, the spending levels of the continuing resolution for FY 2018 that preceded the March-enacted levels. (Notes accompanying each of the statistical tables in this report provide guidance on the basis for the FY 2018 numbers from each agency.)
The data for FY 2019 data are the proposed funding levels of the president’s Budget of the United States Government, Fiscal Year 2019 (released 12 February 2018). The president’s proposal came, however, in two parts. The first part was a regular request. The second part was an addendum (released the same day) that added $75 billion in nondefense discretionary spending to the regular request for FY 2019, spread among several agencies, but only some of which represented increased agency funding for R&D. This addendum funding reflected the administration’s recognition of the higher caps on discretionary spending for FYs 2018 and 2019 authorized by the Bipartisan Budget Act of 2018 (enacted 9 February 2018). Some agencies prepared FY 2019 spending including the addendum funding; some did not. (Notes accompanying each of the statistical tables in this report provide guidance on the basis for the FY 2019 numbers from each agency.)
The data generally reflect agency documents and other Office of Management and Budget (OMB) data available through October 2018. At the time of this report, the proposed figures for FY 2019 remain the subject of ongoing legislative activity in Congress to enact the federal government’s annual budget.
Data reported here as “preliminary” or “proposed” will be revised in subsequent editions of this report to reflect the later congressional appropriation actions and agency program-funding decisions.
Research, Development, and R&D Plant
In this report, R&D refers to basic research, applied research, and experimental development activities in science and engineering.
Research and experimental development is creative and systematic work undertaken in order to increase the stock of knowledge—including knowledge of people, culture, and society—and to devise new applications using available knowledge.
Funds for R&D include administrative expenses for R&D, such as the operating costs of research facilities and equipment and other overhead costs. They also include funds for the purchase of minor equipment—such as personal computers, standard microscopes, and simple spectrometers.
Basic research is experimental or theoretical work undertaken primarily to acquire new knowledge of the underlying foundations of phenomena and observable facts. Basic research may include activities with broad or general applications in mind, such as the study of how plant genomes change, but should exclude research directed towards a specific application or requirement, such as the optimization of the genome of a specific crop species.
Applied research is original investigation undertaken in order to acquire new knowledge. Applied research is, however, directed primarily towards a specific, practical aim or objective.
Experimental development is creative and systematic work, drawing on knowledge gained from research and practical experience, which is directed at producing new products or processes or improving existing products or processes. Like research, experimental development will result in gaining additional knowledge.
Experimental development activities include (1) the production of materials, devices, and systems or methods, including the design, construction, and testing of experimental prototypes; and (2) technology demonstrations, where a system or component is being demonstrated at scale for the first time and it is realistic to expect additional refinements to the design (feedback R&D) following the demonstration.
Prior to FY 2018, a more expansive definition of development was used, so that guidance is now given on specific exclusions. Experimental development does not include (1) user demonstrations, where the cost and benefits of a system are being validated for a specific use case (e.g., low-rate initial production activities); or (2) preproduction development, which is defined as nonexperimental work on a product or system before it goes into full production, including activities such as tooling and development of production facilities. For example, activities and programs that are categorized as “Operational Systems Development” in the Department of Defense’s Research, Development, Test and Evaluation (RDT&E) budget activity structure are no longer included as R&D. Activities and programs of that type generally are now reported as investments in other major non-R&D equipment.
R&D plant includes both facilities and major equipment necessary for the execution of an R&D program. It includes the purchase, construction, manufacture, rehabilitation, or major improvement of physical assets such as land, major fixed equipment, and supporting infrastructure like a sewer line or housing at a remote location. It also includes the acquisition, design, or production of major movable equipment, such as mass spectrometers, research vessels, DNA sequencers, and other movable major instruments for use in R&D activities.
The data in this report exclude all non-R&D activities performed within budget functions that conduct R&D and all functions in which no R&D is conducted, with the following exception: table 6 continues to report RDT&E totals that previously would have been classified as R&D. This is done to provide a sense of the impact of the change in the definition of development (as detailed above) on defense R&D totals.
Budget Authority, Obligations, and Outlays
The federal R&D funding data presented here (with only a few noted exceptions) are provided in terms of budget authority. Budget authority is used because it is the initial budget stage for congressional action on the president’s proposed budget. Budget authority imposes a ceiling on obligations and outlays; obligations and outlays flow from budget authority.
Budget authority is the primary source of legal authorization to enter into obligations that will result in outlays. Budget authority is most commonly granted in the form of appropriations by the congressional committees assigned to determine the budget for each function.
Obligations represent the amounts for orders placed, contracts awarded, services received, and similar transactions during a given period, regardless of when the funds were appropriated and when the future payment of money is required.
Outlays represent the amounts for checks issued and cash payments made during a given period, regardless of when the funds were appropriated or obligated.
Budget Functions and Classifying R&D
The federal budget total is the sum of funding across the 20 broad functional categories. These categories are National defense (function 050); International affairs (150); General science, space, and technology (250); Energy (270); Natural resources and environment (300); Agriculture (350); Commerce and housing credit (370); Transportation (400); Community and regional development (450); Education, training, employment, benefits, and services (500); Health (550); Medicare (570); Income security (600); Social security (650); Veterans benefits and services (700); Administration of justice (750); General government (800); Net interest (900); Allowances (920); and Undistributed offsetting receipts (950).
R&D has never been reported in 4 of these 20 functions: Social security (650), Net interest (900), Allowances (920), and Undistributed offsetting receipts (950). As such, these categories are not present in this report’s data, except indirectly, where R&D is described as a proportion of total federal budget authority.
Small amounts of R&D had been reported in the General government (800) category up through FY 2002 but turned to zero thereafter. A small amount of R&D was again reported in FY 2012 but has been zero throughout the FY 2016–18 period covered in this report.
To better highlight R&D areas of high interest, the data tables in this report split the General science, space, and technology (250) category into its two subfunctions: General science and basic research (251), and Space flight, research, and supporting activities (252).
Overall, this report’s data tables separately cover 16 functional categories: 14 at the broad functional category level and 2 at the subcategory level.
Each R&D activity is assigned to only one functional category—which is consistent with the official codes used in budget documents, even though the R&D activity may address the objectives of several functions. For example, all R&D activities sponsored by the Department of Defense (except for those of the U.S. Army Corps of Engineers) are classified as National defense (050), even though some of these have secondary objectives, such as Space flight, research, and supporting activities (252) or Health (550). Nonetheless, an agency’s overall R&D effort can involve multiple activities spread across several functional categories, which means that a functional category can show the presence of several agencies. For example, the federal funding for the past national project to map the human genome, which involved the activities of several agencies and many R&D programs, appeared in the categories of Health (550) and General science and basic research (251).
Finally, not all federally sponsored basic research is categorized in the General science and basic research (251) subfunction. Some basic research is included in many of the other functional categories. Also, not all the R&D included in the General science and basic research (251) subfunction is basic research—some is applied research.
Technical table A-1 maps the mix of agency funding of R&D activities in FYs 2016–18 across the budget function categories.
The federal budget does not include a separately identified R&D account. Furthermore, most appropriations for R&D are not directly labeled as such (except in certain program areas, such as defense, energy, health, and environment). Thus, most funds for R&D are not line items in agency budget submissions but are included instead as part of general program funding.
To provide information on federal R&D funding, OMB requires all agencies with R&D funding levels greater than $10 million annually to submit data on their R&D programs as part of their annual budget submissions. Such agencies are requested to provide data on their funding levels for basic research, applied research, experimental development, R&D facilities, and capital equipment for R&D, in accordance with OMB’s Circular No. A-11, Section 84: “Character Classification (Schedule C)” at https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/assets/a11_current_year/a11_2016.pdf.
The data in this report were collected between July and September 2018 and represent the agencies’ official estimates of actual and proposed federal funding for R&D over the FY 2017–19 period. The data are based primarily on information provided to OMB by 26 agencies, which account for about 99% of all federally sponsored R&D activities. (OMB has routinely tracked the R&D budget authority for these 26 agencies; other agencies with negligible levels of R&D budget authority are excluded.) The data reflect R&D funding information that became available from individual agencies after the administration’s FY 2019 budget proposal, An American Budget, Budget of the United States Government, Fiscal Year 2019, was prepared and transmitted to Congress on 12 February 2018. This information consists of budget justification documents that agencies submit to Congress and supplemental, program-specific information obtained from agency budget and program staff, collected through October 2018. Accordingly, the budget numbers reported for individual activities, programs, or agencies may differ somewhat from those published in the president’s budget or in agency budget documents.
Suggested Citation and Acknowledgments
National Science Foundation, National Center for Science and Engineering Statistics. 2019. Federal R&D Funding, by Budget Function: Fiscal Years 2017–19. Detailed Statistical Tables NSF 19-312. Alexandria, VA. Available at https://ncses.nsf.gov/pubs/nsf19312/.
The statistical tables in this report were compiled for the National Center for Science and Engineering Statistics (NCSES) by the American Association for the Advancement of Science (AAAS), R&D Budget and Policy Program (Matthew Hourihan, Director). NCSES and AAAS thank the program and budget offices at the agencies that provided information for this report.
This report was developed and coordinated by Mark Boroush of the NCSES’s Research and Development Statistics Program under the direction of John E. Jankowski. Emilda Rivers, division director, reviewed and provided overall guidance. Statistical review of the draft manuscript was performed by Jock Black, mathematical statistician, and Samson Adeshiyan, chief statistician. Publication processing support was provided by Catherine Corlies and Joseph Newman in NCSES’s Information and Technology Services Program under the direction of May Aydin.
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