Federal Funds for Research and Development: Fiscal Years 2019–20

Purpose. The annual Survey of Federal Funds for Research and Development (Federal Funds Survey) is the primary source of information about federal funding for R&D in the United States. The results of the survey are used to help implement four federal programs: the Federal Laboratory Consortium for Technology Transfer, Small Business Innovation Research, Small Business Technology Transfer, and Established Program to Stimulate Competitive Research.

Data collection authority. The information is solicited under the authority of the National Science Foundation Act of 1950, as amended, and the America COMPETES Reauthorization Act of 2010.

Survey contractor. Synectics for Management Decisions, Inc. (Synectics).

Survey sponsor. The National Center for Science and Engineering Statistics (NCSES) within the National Science Foundation (NSF).

Frequency. Annual.

Initial survey year. 1951.

Reference period. FYs 2019–20.

Response unit. Federal agencies.

Sample or census. Census.

Population size. In the survey cycle for data collection on FYs 2019–20, a total of 33 federal agencies reported R&D data. (See section “Survey Design” for details.)

Sample size. Not applicable; the survey is a census of all federal agencies that conduct R&D programs, excluding the Central Intelligence Agency (CIA).

Target population. The Federal Funds Survey target population consists of the federal agencies that conduct R&D programs, excluding the CIA. For the FYs 2019–20 cycle, 33 federal agencies (15 federal departments and 18 independent agencies) reported R&D data. Because multiple subdivisions of some federal departments completed the survey, there were 83 agency-level respondents: 5 federal departments, 60 agencies within another 10 federal departments, and 18 independent agencies. (Note: The Department of Treasury’s Internal Revenue Service [IRS] reported no funds.) However, lower offices could also be authorized to enter data: in Federal Funds Survey nomenclature, agency-level offices could authorize program offices, program offices could authorize field offices, and field offices could authorize branch offices. When these sub-offices are included, there were 699 total respondents: 83 agencies, 169 program offices, 81 field offices, and 366 branch offices.

Sampling frame. The survey is a census of all federal agencies that conduct R&D programs, which are identified from information in the president’s budget submitted to Congress. The Analytical Perspectives volume and the “Detailed Budget Estimates by Agency” section of the appendix to the president’s budget identify agencies that receive R&D funding.

Sample design. Not applicable.

Data collection. Data for FYs 2019–20 (volume 69) were collected by Synectics under contract to NCSES. Data collection began with an e-mail to each agency to verify the name, address, fax and phone numbers, and e-mail address of each agency-level survey respondent. A Web-based data collection system is used to collect the Federal Funds Survey data.

The Web-based data collection system is part of NCSES’s effort to enhance survey reporting and reduce data collection and processing costs by offering respondents direct online reporting and editing; however, some agencies submit their data in alternative formats.

Volume 69 continued the procedure established in volume 66 to collect information for 2 instead of 3 federal government fiscal years: the fiscal year just completed (FY 2019—i.e., 1 October 2018 through 30 September 2019) and the current fiscal year (FY 2020). FY 2019 data are completed transactions. FY 2020 data are estimates of congressional appropriation actions and apportionment and reprogramming decisions. After consultation with data users, it was determined that the budget year projections for obligations based on the president’s budget request to Congress were not as useful as the budget authority data presented in the budget request, so data were not requested for the president’s budget year.

Data collection began on 19 February 2020, and the requested due date for data submissions was 1 May 2020. Data collection was extended until all surveyed agencies provided complete and final survey data.

Mode. The Federal Funds Survey uses a Web-based data collection system. The Web-based system consists of a data collection component that allows survey respondents to enter their data online and a monitoring component that allows the data collection contractor to monitor support requests, data entry, and data issues. The Web-based system’s two components are password protected, so that only authorized respondents and staff can access them. All data imports and trend checking are accomplished using the Web-based system.

Response rate. 100%.

Data checking. Data errors in the Federal Funds Survey are flagged automatically by the Web-based data collection system: respondents cannot submit their data to NCSES until all required fields have been completed without errors. Once data are submitted, each agency’s narrative statement, 2-year difference report, and $100-million difference report are reviewed. Respondents are contacted to resolve potential reporting errors that cannot be reconciled by the narratives. Explanations of questionable data are noted.

Imputation. None.

Weighting. None.

Variance estimation. Not applicable.

Sampling error. Not applicable.

Coverage error. Given the existence of a complete list of all eligible agencies, there is no known coverage error. The CIA is purposefully excluded.

Nonresponse error. Agencies are encouraged to estimate when actual data are unavailable. The survey instrument allows respondents to enter data or skip data fields. There are several possible sources of nonresponse error by respondents, including inadvertently skipping data fields, skipping data fields under the false assumption that blank fields are equivalent to zero, and skipping data fields when data are unavailable.

Measurement error. Some measurement problems are known to exist in the Federal Funds Survey data. Some agencies cannot report the full costs of R&D, the ultimate performer of R&D, or R&D plant data.

For example, the Department of Defense (DOD) does not include headquarters costs of planning and administering R&D programs, which are estimated at a fraction of 1% of its total cost. DOD has stated that identification of amounts at this level is impracticable.

The National Institutes of Health (NIH) in the Department of Health and Human Services (HHS) currently has many of its awards in its financial system without any field of science code. Therefore, NIH uses an alternate source to estimate its research dollars by field of science. NIH uses scientific class codes (based upon history of grant, content of the title, and the name of the awarding institute or center) as an approximation for field of science codes.

The National Aeronautics and Space Administration (NASA) does not include any field of science codes in its financial database. Consequently, NASA must estimate what percentage of the agency’s research dollars are allocated into the fields of science.

Also, agencies are required to report the ultimate performer of R&D. However, through past workshops, NCSES has learned that some agencies do not always track their R&D dollars to the ultimate performer of R&D. This leads to some degree of misclassification of performers of R&D, but NCSES has not determined the extent of the errors in performer misclassification by the reporting agencies.

Eleven agencies are required to report R&D obligations by state and performer (the Departments of Agriculture, Commerce, Defense, Energy, Health and Human Services, Homeland Security, the Interior, and Transportation; the Environmental Protection Agency; NASA; and NSF). Obligations of these 11 agencies represent the majority of total federal R&D obligations (98% for FYs 2008–19), but there is some underreporting by state, which may affect states unevenly. In addition, geographic distribution of DOD development funding to industry reflects the location of prime contractors and not the numerous subcontractors who perform much of the R&D. DOD development funding to industry represented 48.0% of total federal obligations for development in FY 2019 ($29.4 billion out of $61.3 billion).

R&D plant data are underreported to some extent because of the difficulty some agencies, particularly DOD and NASA, encounter in identifying and reporting these data. DOD’s respondents report obligations for R&D plant that are funded under the agency’s appropriation for construction, but they are able to identify only a small portion of the R&D plant support that is within R&D contracts funded from DOD’s appropriation for research, development, testing, and evaluation. Similarly, NASA respondents cannot separately identify the portions of industrial R&D contracts that apply to R&D plant, since these data are subsumed in the R&D data covering industrial performance. NASA R&D plant data for other performing sectors are reported separately.

Data revisions. When completing the current year’s survey, agencies naturally revise their estimates for the last year of the previous report—in this case, FY 2019. Sometimes, survey submissions also reflect reappraisals and revisions in classification of various aspects of agencies’ R&D programs; in those instances, NCSES requests that agencies provide revised prior-year data to maintain consistency and comparability with the most recent R&D concepts.

For trend comparisons, use the historical data from only the most recent publication, which incorporates changes agencies have made in prior-year data to reflect program reclassifications or other corrections. Do not use data published earlier.

Changes in survey coverage and population. This cycle (volume 69, FYs 2019–20), one new agency was added as a respondent, the Biomedical Advanced Research and Development Authority; one agency resumed reporting, the U.S. Agency for Global Media (formerly the Broadcasting Board of Governors); and one agency was removed, the Pension Benefit Guaranty Corporation.

Changes in questionnaire.

• In volumes 68 (FYs 2018–19) and 69 (FYs 2019–20), the survey Table 6A, which collects information on federal intramural R&D obligations, was deactivated and agencies were instructed not to complete it.
• Starting with volume 66 (FYs 2016–17), the survey collects 2 federal government fiscal years—actual data for the fiscal year just completed and estimates for the current fiscal year. Previously, the survey also collected projected obligations for the next fiscal year based on the president’s budget request to Congress. For volume 66, data were collected for only 2 fiscal years due to the delayed FY 2018 budget formulation process. However, after consultation with data users, NCSES determined that the projections were not as useful as the budget authority data presented in the budget request.
• In volume 66, the survey table numbering was changed from Roman numerals I–XI and, for selected agencies, the letters A–E, to Arabic numerals 1–16. The order of tables remained the same.
• In the volume 66 DOD-version of the questionnaire, the definition of major systems development was changed to represent DOD Budget Activities 4 through 6 instead of Budget Activities 4 through 7, and questions relating to funding for Operational Systems Development (Budget Activity 7) were added to the instrument. The Table 6 and Table 11 narrative tables were removed from the DOD-version of the questionnaire.
• In volumes 59 (FYs 2009–11) and 60 (FYs 2010–12), questions relating to funding from the American Recovery and Reinvestment Act of 2009 (ARRA) were added to the data collection instruments. The survey collected separate outlays and obligations for ARRA and non-ARRA sources of funding, by performer and geography for FYs 2009 and 2010.
• Starting with volume 59 (FYs 2009–11), federal funding data were requested in actual dollars (instead of rounded in thousands, as was done through volume 58).

Changes in reporting procedures or classification.

• FY 2019. For volume 69 (FYs 2019–20), FY 2020 preliminary data do not include obligations from supplemental COVID-19 related appropriations (e.g., Coronavirus Aid, Relief, and Economic Security [CARES] Act).
• FY 2019. The Biomedical Advanced Research and Development Authority began reporting. For volume 69 (FYs 2019–20), it could not submit any geographical data, so its data were reported as undistributed on the state tables.
• FY 2019. The U.S. Agency for Global Media (formerly the Broadcasting Board of Governors), which did not report data between FY 2008 and FY 2018, resumed reporting.
• FY 2018. The HHS Centers for Medicare and Medicaid (CMS) funding was reported by the CMS Office of Financial Management at an agency-wide level instead of by the CMS Center for Medicare and Medicaid Innovation (CMMI) and its R&D group, the Office of Research, Development, and Information (ORDI), which used to report at a component level.
• FY 2018. The Department of State added the Global Health Programs R&D funding.
• FY 2018. The Department of Veterans Affairs added funds for the Medical Services support to the existing R&D funding to fully report the total cost of intramural R&D. Although the Medical Services do not directly fund specific R&D activities, they host intramural research programs that were not previously reported.
• FY 2018. The Department of Homeland Security’s (DHS’s) Countering Weapons of Mass Destruction (CWMD) Office was established on 7 December 2017. CWMD consolidated primarily the Domestic Nuclear Detection Office (DNDO) and a majority of the Office of Health Affairs, as well as other DHS elements. Prior to FY 2018, data reported for the CWMD would have been under the DNDO.
• FY 2018. The Department of Energy (DOE) revised its FYs 2016 and 2017 data after discovering its Office of Fossil Energy reported “in thousands” instead of actual dollars for volumes 66 (FYs 2016–17) and 67 (FYs 2017–18).
• FY 2018. The Department of Agriculture’s (USDA’s) Economic Research Service (ERS) partially revised its FYs 2009 and 2010 data during the volume 61 (FYs 2011–13) cycle. NCSES discovered a discrepancy that was corrected during the volume 68 cycle, completing the revision.
• FY 2018. DHS’s Transportation Security Administration, which did not report data between FY 2010 and FY 2017, resumed reporting for volume 68 (FYs 2018–19).
• FY 2018. DHS’s U.S. Secret Service, which did not report data between FY 2009 and FY 2017, resumed reporting for volume 68 (FYs 2018–19).
• FY 2018. NCSES discovered that in some past volumes the obligations reported for basic research in certain foreign countries were greater than the corresponding obligations reported for R&D; the following data were corrected as a result: DOD and Chemical and Biological Defense FY 2003 data, Defense agencies and activities FY 2003 and FY 2011 data, Department of the Air Force FY 2009 data, and Department of the Navy FY 2005, FY 2011, and FY 2013 data; DOE and Office of Science FY 2009 data; HHS and Centers for Disease Control and Prevention (CDC) FY 2008 and FY 2017 data; and NSF FY 2001 data. NCSES also discovered that some obligations reported for academic performers were greater than the corresponding obligations reported for total performers, and DOD and Department of the Air Force FY 2009 data, DOE and Fossil Energy FY 1999 data, and NASA FY 2008 data were corrected. Finally, NCSES discovered a problem with FY 2017 HHS CDC personnel costs data, which were then also corrected.
• FY 2017. The Department of the Treasury’s IRS performed a detailed evaluation and assessment of its programs and determined that none of its functions can be defined as R&D activity as defined in Office of Management and Budget (OMB) Circular A-11. The review included discussions with program owners and relevant contractors who perform work on behalf of the IRS. The IRS also provided a negative response to the OMB data call on R&D under Circular A-11 for the same reference period (FYs 2017–18). Despite no longer having any R&D obligations, the IRS still sponsors a Federally Funded Research and Development Center, the Center for Enterprise Modernization.
• FY 2017. NASA estimated that the revised OMB definition for "experimental development" reduced its reported R&D total by about $2.7 billion in FY 2017 and $2.9 billion in FY 2018 from what would have been reported under the previous definition prior to volume 66 (FYs 2016–17).
• FY 2017. The Patient-Centered Outcomes Research Trust Fund (PCORTF) was established by Congress through the Patient Protection and Affordable Care Act of 2010, signed by the president on 23 March 2010. PCORTF began reporting for volume 67 (FYs 2017–18), but it also submitted data for FYs 2011–16.
• FY 2017. The Tennessee Valley Authority, which did not report data between FY 1999 and FY 2016, resumed reporting for volume 67 (FYs 2017–18).
• FY 2017. The U.S. Postal Service, which did not report data between FY 1999 and FY 2016, resumed reporting for volume 67 (FYs 2017–18) and submitted data for FYs 2015–16.
• FY 2017. During the volume 67 (FYs 2017–18) data collection, DHS’s Science and Technology Directorate revised its FY 2016 data.
• FY 2016. The Administrative Office of the U.S. Courts began reporting as of volume 66 (FYs 2016–17).
• Beginning with FY 2016, the totals reported for development obligations and outlays represent a refinement to this category by more narrowly defining it to be “experimental development.” Most notably, totals for development do not include the DOD Budget Activity 7 (Operational System Development) obligations and outlays. Those funds, previously included in DOD’s development totals, support the development efforts to upgrade systems that have been fielded or have received approval for full rate production and anticipate production funding in the current or subsequent fiscal year. Therefore, the data are not directly comparable with totals reported in previous years.
• Prior to the volume 66 launch, the definitions of basic research, applied research, experimental development, R&D, and R&D plant were revised to match the definitions used by the OMB in the July 2016 version of Circular A-11, Section 84 (Schedule C).
• FYs 2016–17. Before the volume 66 survey cycle, NSF updated the list of foreign performers in the Federal Funds Survey to match the list of countries and territories in the Department of State’s Bureau of Intelligence and Research fact sheet of Independent States in the World and fact sheet of Dependencies and Areas of Special Sovereignty. Country lists in volume 66 data tables and later may differ from those in previous reports.
• FY 2015. The HHS Administration for Community Living (ACL) began reporting in FY 2015, replacing the Administration on Aging, which was transferred to ACL when ACL was established on 18 April 2012. Several programs that serve older adults and people with disabilities were transferred from other agencies to ACL, including a number of programs from the Department of Education due to the 2014 Workforce Innovation and Opportunities Act.
• FY 2015. The Department of the Interior’s Bureau of Land Management and U.S. Fish and Wildlife Service, which did not report data between FY 1999 and FY 2014, resumed reporting.
• In January 2014, all Research and Innovative Technology Administration programs were transferred into the Office of the Assistant Secretary for Research and Technology in the Office of the Secretary of Transportation.
• FY 2014. DHS’s Domestic Nuclear Detection Office began reporting for FY 2014.
• FY 2014. The Department of State data for FY 2014 were excluded due to their poor quality.
• FY 2013. NASA revamped its reporting process so that the data for FY 2012 forward are not directly comparable with totals reported in previous years.
• FY 2012. NASA began reporting International Space Station (ISS) obligations as research rather than R&D plant.
• Starting with volume 62 (FYs 2012–14), an “undistributed” category was added to the geographic location tables for DOD obligations for which the location of performance is not reported. It includes DOD obligations for industry R&D that were included in individual state totals prior to FY 2012 and DOD obligations for other performers that were not reported prior to FY 2011. This change was applied retroactively to FY 2011 data.
• Starting with volume 61 (FYs 2011–13), DOD subagencies other than the Defense Advanced Research Projects Agency were reported as an aggregate total under other defense agencies to enable complete reporting of DOD R&D (both unclassified and classified). Consequently, DOD began reporting additional classified R&D not previously reported by its subagencies.
• FY 2011. USDA’s ERS partially revised its data for FYs 2009 and 2010 data during the volume 61 (FYs 2011–13) cycle.
• FY 2010. NASA resumed reporting ISS obligations as R&D plant.
• FYs 2000–09. Beginning in FY 2000, the Department of the Air Force (AF) did not report Budget Activity (BA) 6.7 Operational Systems Development data because the agency misunderstood the reporting requirements. During the volume 57 data collection cycle, AF edited prior-year data for FYs 2000–07 to include BA 6.7 Operational Systems Development data. These data revisions were derived from FY 2007 distribution percentages that were then applied backward to revise data for FYs 2000–06.
• FYs 2006–07. NASA’s R&D obligations decreased by $1 billion. Of this amount, $850 million was accounted for by obligations for operational projects that NASA excluded in FY 2007 but reported in FY 2006. The remainder was from an overall decrease in obligations between FYs 2006 and 2007.
• FY 2006. NASA reclassified funding for the following items as operational costs: Space Operations, the Hubble Space Telescope, the Stratospheric Observatory for Infrared Astronomy, and the James Webb Space Telescope. This funding was previously reported as R&D plant.
• FYs 2005–07. Before the volume 55 survey cycle, NSF updated the list of foreign performers in the Federal Funds Survey to match the list of countries and territories in the Department of State’s Bureau of Intelligence and Research fact sheet of Independent States in the World and fact sheet of Dependencies and Areas of Special Sovereignty. Area and country lists in volume 55 data tables and later may differ from those in previous reports.
• FYs 2004–06. NASA implemented a full-cost budget approach, which includes all of the direct and indirect costs for procurement, personnel, travel, and other infrastructure-related expenses relative to a particular program and project. NASA’s data for FY 2004 and later years may not be directly comparable with its data for FY 2003 and earlier years.
• FY 2004. NIH revised its financial database; beginning with FY 2004, NIH records no longer contain information on the field of science and engineering. Data for FY 2004 and later years are not directly comparable with data for FY 2003 and earlier years.
• Data for FYs 2003–06 from the Substance Abuse and Mental Health Services Administration (SAMHSA) are estimates based on SAMHSA's obligations by program activity budget and previously reported funding for development.
• FY 2003. SAMHSA reclassified some of its funding categories as non-R&D that had been considered R&D in prior years.
• On 25 November 2002, the president signed the Homeland Security Act of 2002, establishing the Department of Homeland Security (DHS). DHS includes the R&D activities previously reported by the Federal Emergency Management Agency, the Science and Technology Directorate, the Transportation Security Administration, the U.S. Coast Guard, and the U.S. Secret Service.
• FY 2000. NASA reclassified the ISS as a physical asset, reclassified ISS Research as equipment, and transferred funding for the program from R&D to R&D plant.
• FY 2000. NIH reclassified as research the activities that it had previously classified as development. NIH data for FY 2000 forward reflect this change. For more information on the classification changes at NASA and NIH, refer to Classification Revisions Reduce Reported Federal Development Obligations (InfoBrief NSF 02-309), February 2002, available at https://www.nsf.gov/statistics/nsf02309.
• FYs 1996–98. The lines on the survey instrument for the special foreign currency program and for detailed field of science and engineering (S&E) were eliminated beginning with the volume 46 survey cycle. Two tables depicting data on foreign performers by region, country, and agency that were removed before publication of volume 43 were reinstated with volume 46.
• FYs 1994–96. During the volume 44 survey cycle, the Director for Defense Research and Engineering (DDR&E) at DOD requested that NSF further clarify the true character of DOD’s R&D program, particularly as it compares with other federal agencies, by adding more detail to development obligations reported by DOD respondents. Specifically, DOD requested that NSF allow DOD agencies to report development obligations in two separate categories: advanced technology development and major systems development.
  
  An excerpt from a letter written by Robert V. Tuohy, Chief, Program Analysis and Integration at DDR&E, to John E. Jankowski, Program Director, Research and Development Statistics Program, Division of Science Resources Statistics, NSF, explains the reasoning behind the DDR&E request:
  
  “The DOD’s R&D program is divided into two major pieces, Science and Technology (S&T) and Major Systems Development. The other federal agencies’ entire R&D programs are equivalent in nature to DOD’s S&T program, with the exception of the Department of Energy and possibly NASA. Comparing those other agency programs to DOD’s program, including the development of weapons systems such as F-22 Fighter and the New Attack Submarine, is misleading.”
• FYs 1990–92. Since volume 40, DOD has reported research obligations and development obligations separately. Tables reporting obligations for research, by state and performer, and obligations for development, by state and performer, were specifically created for DOD. Circumstances specific to DOD are (1) DOD funds the preponderance of federal development and (2) DOD development funded at institutions of higher education is typically performed at university-affiliated nonacademic laboratories, which are separate from universities’ academic departments, where university research is typically performed.

Agency and subdivision. An agency is an organization of the federal government whose principal executive officer reports to the president. The Library of Congress and the Administrative Office of the U.S. Courts are also included in the survey, even though the chief officer of the Library of Congress reports to Congress and the U.S. Courts are part of the judicial branch. Subdivision refers to any organizational unit of a reporting agency, such as a bureau, division, office, or service.

Development. See R&D and R&D plant.

Fields of science and engineering. The Federal Funds Survey uses eight broad field categories, each comprising a number of detailed fields. A discipline under one detailed field may be classified under another detailed field when the major emphasis is elsewhere. Research in biochemistry, for example, might be reported as biological, agricultural, or medical, depending on the focus of the project. No double counting is intended or allowed. The fields are as follows:

• Computer sciences and mathematics employs logical reasoning with the aid of symbols and is concerned with the development of methods of operation using such symbols or with the application of such methods to automated information systems. Detailed fields: computer sciences, mathematics, and other computer sciences and mathematics.
• Engineering is concerned with developing engineering principles or making specific principles usable in engineering practice. Detailed fields: aeronautical, astronautical, chemical, civil, electrical, mechanical, metallurgy and materials engineering, and other engineering.
• Environmental sciences (terrestrial and extraterrestrial) is, with the exception of oceanography, concerned with the gross nonbiological properties of the areas of the solar system that directly or indirectly affect human survival and welfare. Obligations for studies pertaining to life in the sea or other bodies of water are reported as support of oceanography, not biology. Detailed fields: atmospheric sciences, geological sciences, oceanography, and other environmental sciences.
• Life sciences is concerned with the scientific study of living organisms and their systems. Detailed fields: agricultural sciences, biological sciences (excluding environmental biology), environmental biology, medical sciences, and other life sciences.
• Physical sciences is concerned with understanding of the material universe and its phenomena. Detailed fields: astronomy, chemistry, physics, and other physical sciences.
• Psychology deals with behavior, mental processes, and individual and group characteristics and abilities. Detailed fields: biological aspects, social aspects, and other psychological sciences.
• Social sciences is concerned with an understanding of the behavior of social institutions and groups and of individuals as members of a group. Detailed fields: anthropology, economics, political science, sociology, and other social sciences.
• Other sciences not elsewhere classified (nec) is used for multidisciplinary or interdisciplinary projects that cannot be classified within one of the broad fields of science already listed.

Federal obligations for research performed at universities and colleges, by detailed field of science and engineering. Seven agencies respond to this part of the survey: the Departments of Agriculture, Defense, Energy, Health and Human Services, and Homeland Security; NASA; and NSF.

Geographic distribution of R&D obligations. The 11 largest R&D funding agencies respond to this portion of the survey: the Departments of Agriculture, Commerce, Defense, Energy, Health and Human Services, Homeland Security, the Interior, and Transportation; the Environmental Protection Agency; NASA; and NSF. They are asked to provide the principal location (state or outlying area) of the work performed by the primary contractor, grantee, or intramural organization, assign the obligations to the location of the headquarters of the U.S. primary contractor, grantee, or intramural organization, or list the funds as undistributed.

Obligations and outlays. Obligations represent the amounts for orders placed, contracts awarded, services received, and similar transactions during a given period, regardless of when funds were appropriated and when future payment of money is required. Outlays represent the amounts for checks issued and cash payments made during a given period, regardless of when funds were appropriated.

Performer. An intramural group or organization carrying out an operational function or an extramural organization or a person receiving support or providing services under a contract or grant.

• Intramural performers are agencies of the federal government, including federal employees who work on R&D both onsite and offsite. The work of these agencies is carried out directly by agency personnel. Obligations reported under this category are for activities performed or to be performed by the reporting agency itself or are for funds that the agency transfers to another federal agency for performance of work, as long as the ultimate performer is that agency or any federal agency. If the ultimate performer is not a federal agency, funds transferred are reported by the transferring agency under the appropriate extramural performer category (businesses, universities and colleges, other nonprofit institutions, FFRDCs, nonfederal government, and foreign).
  
  Intramural activities cover not only actual intramural R&D performance but also the costs associated with administration of intramural R&D programs and extramural R&D procurements by federal personnel. Intramural activities also include the costs of supplies and off-the-shelf equipment (equipment that has gone beyond the development or prototype stage) procured for use in intramural R&D. For example, an operational launch vehicle purchased from an extramural source by NASA and used for intramural performance of R&D is reported as a part of the cost of intramural R&D.
• Extramural performers are organizations outside the federal sector that perform R&D with federal funds under contract, grant, or cooperative agreement. Only costs associated with actual R&D performance are reported. Types of extramural performers:
• Businesses or Industrial firms—Organizations that may legally distribute net earnings to individuals or to other organizations.
• Universities and colleges—Institutions of higher education in the United States that engage primarily in providing resident or accredited instruction for a not less than a 2-year program above the secondary school level that is acceptable for full credit toward a bachelor’s degree or that provide not less than a 1-year program of training above the secondary school level that prepares students for gainful employment in a recognized occupation. Included are colleges of liberal arts; schools of arts and sciences; professional schools, as in engineering and medicine, including affiliated hospitals and associated research institutes; and agricultural experiment stations. Other examples of universities and colleges include community colleges, 4-year colleges, universities, and freestanding professional schools (medical schools, law schools, etc.).
• Other nonprofit institutions—Private organizations other than educational institutions whose net earnings do not benefit either private stockholders or individuals and other private organizations organized for the exclusive purpose of turning over their entire net earnings to such nonprofit organizations. Examples of nonprofit institutions include foundations, trade associations, charities, and research organizations.
• Federally funded research and development centers (FFRDCs)—R&D-performing organizations that are exclusively or substantially financed by the federal government and are supported by the federal government either to meet a particular R&D objective or in some instances to provide major facilities at universities for research and associated training purposes. Each center is administered by an industrial firm, a university, or another nonprofit institution (see https://www.nsf.gov/statistics/ffrdclist/ for the Master Government List of FFRDCs maintained by NSF).
• State and local governments—State and local government agencies, excluding state or local universities and colleges, agricultural experiment stations, medical schools, and affiliated hospitals. (Federal R&D funds obligated directly to such state and local institutions are excluded in this category. However, they are included under the universities and colleges category in this report.) R&D activities under the state and local governments category are performed either by the state or local agencies themselves or by other organizations under grants or contracts from such agencies. Regardless of the ultimate performer, federal R&D funds directed to state and local governments are reported only under this sector.
• Foreign performers—Other nations’ citizens, organizations, universities and colleges, governments, as well as international organizations located outside the United States, that perform R&D. In most cases, foreigners performing R&D in the United States are not reported here. Excluded from this category are U.S. agencies, U.S. organizations, or U.S. citizens performing R&D abroad for the federal government. Examples of foreign performers include the North Atlantic Treaty Organization (NATO), the United Nations Educational, Scientific, and Cultural Organization (UNESCO), and the World Health Organization (WHO). An exception in the past was made in the case of U.S. citizens performing R&D abroad under special foreign-currency funds; these activities were included under the foreign performers category but have not been collected since the mid-1990s.
• Private individuals—When an R&D grant or contract is awarded directly to a private individual, obligations incurred are placed under the category industrial firms.

R&D and R&D plant. Amounts for R&D and R&D plant include all direct, incidental, or related costs resulting from, or necessary to, performance of R&D and costs of R&D plant as defined below, regardless of whether R&D is performed by a federal agency (intramurally) or by private individuals and organizations under grant or contract (extramurally). R&D excludes routine product testing, quality control, mapping and surveys, collection of general-purpose statistics, experimental production, and the training of scientific personnel.

• Research is defined as systematic study directed toward fuller scientific knowledge or understanding of the subject studied. Research is classified as either basic or applied, according to the objectives of the sponsoring agency.
• Basic research is defined as 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 defined as original investigation undertaken in order to acquire new knowledge. Applied research is, however, directed primarily towards a specific practical aim or objective.
• Development, also known as experimental development, is defined as 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.

For reporting experimental development activities, the following are included:

The production of materials, devices, and systems or methods, including the design, construction, and testing of experimental prototypes.

Technology demonstrations, in cases 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. However, not all activities that are identified as “technology demonstrations” are R&D.

However, experimental development excludes the following:

User demonstrations where the cost and benefits of a system are being validated for a specific use case. This includes low-rate initial production activities.

Pre-production development, which is defined as non-experimental work on a product or system before it goes into full production, including activities such as tooling and development of production facilities.

To better differentiate between the part of the federal R&D budget that supports science and key enabling technologies (including technologies for military and nondefense applications) and the part that primarily supports testing and evaluation (mostly of defense-related systems), NSF collects development dollars from DOD in two categories: advanced technology development and major systems development.

DOD uses Research, Development, Test, and Evaluation (RDT&E) Budget Activities 1–7 to classify data into the survey categories. Within DOD’s research categories, basic research is classified as Budget Activity 1, and applied research is classified as Budget Activity 2. Within DOD’s development categories, advanced technology development is classified as Budget Activity 3. Starting in volume 66, major systems development is classified as Budget Activities 4–6 instead of Budget Activities 4–7 and includes advanced component development and prototypes, system development and demonstration, and RDT&E management support; data on Budget Activity 7, operational systems development, is collected separately. (Note: As a historical artifact from previous DOD budget authority terminology, funds for Budget Activity categories 1 through 7 are sometimes referred to as 6.1 through 6.7 monies.)

• Demonstration includes amounts for activities that are part of R&D (i.e., that are intended to prove or to test whether a technology or method does in fact work). Demonstrations intended primarily to make information available about new technologies or methods are excluded.
• R&D plant is defined as spending on both R&D facilities and major equipment as defined in OMB Circular A-11 Section 84 (Schedule C) and includes physical assets, such as land, structures, equipment, and intellectual property (e.g., software or applications) that have an estimated useful life of 2 years or more. Reporting for R&D plant includes the purchase, construction, manufacture, rehabilitation, or major improvement of physical assets regardless of whether the assets are owned or operated by the federal government, states, municipalities, or private individuals. The cost of the asset includes both its purchase price and all other costs incurred to bring it to a form and location suitable for use.
• For reporting construction of R&D facilities and major moveable R&D equipment, include the following:

Construction of facilities that are necessary for the execution of an R&D program. This may include land, major fixed equipment, and supporting infrastructure such as a sewer line, or housing at a remote location. Many laboratory buildings will include a mixture of R&D facilities and office space. The fraction of the building that is considered to be R&D may be calculated based on the percentage of square footage that is used for R&D.

Acquisition, design, or production of major moveable equipment, such as mass spectrometers, research vessels, DNA sequencers, and other moveable major instrumentation for use in R&D activities.

Programs of $1 million or more that are devoted to the purchase or construction of R&D major equipment.

Exclude the following:

Construction of other non-R&D facilities.

Minor equipment purchases, such as personal computers, standard microscopes, and simple spectrometers (report these costs under total R&D, not R&D Plant).

Obligations for foreign R&D plant are limited to federal funds for facilities that are located abroad and used in support of foreign R&D.