State Government Agencies’ Expenditures for R&D Totaled $2.6 Billion in FY 2022, an Increase of 5% from FY 2021

State governments’ FY 2022 expenditures for both R&D and R&D plant totaled $2.676 billion (table 1).^{​Expenditures for R&D do not include expenditures for R&D plant because the two are separate funding activities.} R&D accounted for 98.8% of these expenditures at $2.644 billion. R&D plant accounted for just $32 million. State governments served as the largest source of funds for agency R&D at $1.953 billion (73.9%), while federal funds accounted for $691 million (26.1%). In FY 2021, expenditures from state government funds accounted for 75.8% and federal funding accounted for 24.2% of all state R&D expenditures.

Of the six functional categories of state agency R&D expenditures, health-related R&D remained the largest with over $1.101 billion in expenditures, increasing 2.2% from FY 2021. Environment and natural resources–related R&D remained the second-largest functional category with $541 million, while energy-related R&D followed with $327 million. Transportation-related R&D totaled $291 million, while agricultural-related R&D totaled $127 million. Other R&D, a combination of activities including but not limited to corrections, criminal justice, education, forensics, labor, public safety, and social services, totaled $257 million in FY 2022.

Although state governments are both funders and performers of R&D, the majority (73.7%) of their expenditures support extramural R&D (i.e., performers other than state agencies). Higher education institutions were the primary recipients of these expenditures, receiving 53.0% of all extramural funding, followed by companies and individuals (23.4%). All other extramural performers, including nonprofit organizations or other governments, accounted for 23.6%. Intramural performers of R&D, the state agencies themselves, totaled $697 million in FY 2022, an increase of 3.2% from $675 million in FY 2021.

Five states accounted for 67.7% of the $697 million in total expenditures for intramural R&D performed by state agencies in FY 2022: New York ($275 million), California ($88 million), Florida ($51 million), South Carolina ($30 million), and Connecticut ($28 million) (figure 3). New York State’s own intramural R&D expenditures accounted for nearly 39.5% of all state governments’ intramural R&D and were larger than the sum of all other state governments minus California, Connecticut, Florida, and South Carolina.^{​Detailed data on intramural R&D by state are available in data table 5, available at https://ncses.nsf.gov/surveys/state-government-research-development/2022#data.} In FY 2022, 50.1% ($349 million) came from each state’s own funds, while 44.7% ($311 million) of all state agency intramural R&D performance was supported by federal funds (figure 4). New York State accounted for 48.8% ($152 million) of all intramural R&D expenditures sourced from federal funds across all states.^{​Data on intramural R&D by source of funds are available in data table 5, available at https://ncses.nsf.gov/surveys/state-government-research-development/2022#data.}

In FY 2022, all state government expenditures for extramural performance of R&D totaled $1.947 billion. The ten states with the largest amount of extramural R&D expenditures—California ($402 million), Texas ($245 million), New York ($231 million), Florida ($129 million), Alabama ($76 million), Pennsylvania ($76 million), Ohio ($69 million), New Jersey ($62 million), Washington ($36 million), and Connecticut ($32 million)—combined accounted for $1.359 billion or 69.8% of all extramural R&D (figure 5).

However, states varied in how they distributed extramural R&D. For example, Texas state agencies directed $200 million of the state’s total extramural R&D of $245 million toward academic institutions, compared with $44 million to companies and individuals. By comparison, California’s distribution of extramural R&D funding is more balanced across the three sectors, with $129 million directed toward academic institutions, $91 million toward companies and individuals, and $183 million toward other performers.^{​“Other” extramural performers includes nonprofit organizations, including foundations; federal government departments and agencies; other departments or agencies within the state; other state governments; county, city, special district, or regional local governments.}

Of the 502 state agencies that responded to the survey in FY 2022, the largest 20 state agencies, by total expenditures, accounted for 56.3% of all agency R&D expenditures. To illustrate how concentrated expenditures are for health-related R&D, these 20 agencies accounted for $836 million of the $1.101 billion in state agency health R&D, or 75.9% of the funding for total health-related R&D. Although many states invested in health-related R&D, these expenditures are still highly concentrated in the top states. For example, the five largest health agencies reporting R&D expenditures in FY 2022 constitute 60.4% of all state government health-related R&D. State expenditures for energy-related R&D are even more highly concentrated; the California Energy Commission alone accounted for 39.9% of all state agencies’ energy-related R&D expenditures.

All 50 states, the District of Columbia, and Puerto Rico participated in the FY 2022 survey; 502 of the 505 selected agencies responded to the survey. Puerto Rico is not included in the U.S. total due to its classification as a U.S. territory. Data for the FY 2022 survey were collected for NCSES by the Census Bureau under an interagency agreement.

For most states, the fiscal year begins on 1 July and ends the following 30 June. For example, FY 2021 begins on 1 July 2020 and ends on 30 June 2021. There are, however, five exceptions to the 30 June fiscal year end: New York (ends 31 March); Texas (ends 31 August); and Alabama, Michigan, and the District of Columbia (all end 30 September). Data presented in this InfoBrief are for each of the respective fiscal year periods as defined by the states.

Terms such as state, state government, and state agencies have equivalent meaning and are used interchangeably throughout this InfoBrief. The amounts reported here are for R&D expenditures of state government departments, agencies, public authorities, commissions, and other dependent entities that operate separately or somewhat autonomously from the central state government. State government R&D totals can display considerable volatility between survey years due to several national and state-specific factors. Large changes are not unusual, especially for discretionary spending items such as R&D. R&D plant expenditures can be highly variable year to year and will increase or decrease as capital projects begin or end.

Amounts reported do not include direct appropriations from state legislatures to universities, colleges, and private organizations. As a result, the $1.0 billion in FY 2022 expenditures reported by state agencies to support R&D performance by academic institutions differs from the figure reported by universities and colleges in the NCSES Higher Education R&D Survey for expenditures on R&D activities funded from state and local government sources because the latter includes direct state appropriations.

Although this survey is a census of state government agencies that fund R&D and there is no sampling error, survey data are still subject to some degree of unmeasurable nonsampling error, which may include errors in classification or measurement of certain aspects of an agency’s R&D. For additional information see the Survey Quality Measures within the technical notes of the survey.^{​Survey technical notes are available at https://ncses.nsf.gov/surveys/state-government-research-development/2022#technical-notes.}

State- and agency-specific data not available in this InfoBrief are available in the full set of data tables from this survey in the report State Government Research and Development: FY 2022 at https://ncses.nsf.gov/surveys/state-government-research-development/2022#data. For more information, please contact the author.

Pece CV; National Center for Science and Engineering Statistics (NCSES). 2023. State Government Agencies’ Expenditures for R&D Totaled $2.6 Billion in FY 2022, an Increase of 5% from FY 2021. NSF 24-305. Alexandria, VA: National Science Foundation. Available at https://ncses.nsf.gov/pubs/nsf24305.

Christopher V. Pece
Survey Manager
Research and Development Statistics Program, NCSES
Tel: (703) 292-7788
E-mail: cpece@nsf.gov

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