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Digging Into the President's FY19 Budget Request

Digging Into the President's FY19 Budget Request

Last week, President Trump sent Congress his budget request for Fiscal Year 2019. The President's Budget Request (PBR) is only the first step in determining appropriations for the coming fiscal year. Over the next few months, Congress will also consider input from agency officials, constituents and other stakeholders as it assembles spending bills for FY 2019. However, Congress must first complete an FY 2018 spending package. Their work has been made easier by the recent passage of the Bipartisan Budget Act of 2018, which raises the overall spending caps for Fiscal Years 2018 and 2019, allowing appropriators room to finalize agency and program funding levels without deep cuts.  

Details on relevant items of the FY 2019 PBR are captured below and links to useful documents follow.

Agency/Office/Program,
$ in thousands
FY17 Final FY18 President’s Request FY18 House   FY18 Senate FY18 Final FY19 President’s Budget Request
Department of Defense, 6.1 Basic Research 2,276,332 2,228,529 2,279,529 2,259,019   2,269,206
DOD, 6.2 Applied Research 5,296,175 4,973,465 5,242,866 5,336,221   5,100,359
DOD, 6.3 Advanced Technology Development 6,438,722 5,997,183 6,277,251 6,346,808   6,330,750
DOD, Total Science & Technology (6.1-6.3) 14,011,229 13,199,177 13,799,646 13,942,048   13,700,315
Department of Education, Pell Grant 22,475,352 22,432,600 22,475,352 22,475,352   22,475,352
DOEd., Pell Grant Maximum Award 5,920 5,920 5,920 6,020   5,920
DOEd., Work Study 989,728 500,000 989,728 989,728   500,000
DOEd., Supplemental Education Opportunity Grants 733,130 0 733,130 733,130   0*
Institute of Education Sciences 605,267 616,839 605,267 600,267   521,563
Department of Energy, Office of Science 5,392,000 4,472,516 5,392,000 5,550,000   5,391,000
DOE, Advanced Research Projects Agency Energy 306,000 20 0 330,000   0*
Environmental Protection Agency, Office of Science 706,473 450,812 602,238 634,029   449,000
National Aeronautics and Space Administration, Science 5,764,900 5,711,800 5,858,500 5,571,000   5,895,000
National Endowment for the Humanities 149,848 42,307 145,000 149,848   42,000*
National Endowment for the Arts 149,849 29,000 145,000 149,849   29,000*
National Institutes of Health, including funds to implement the 21st Century Cures Act 34,084,000 26,920,000 35,184,000 36,084,000   34,767
National Oceanic and Atmospheric Administration, Oceanic and Atmospheric Research 510,826 350,004 474,773 518,725   321,651
National Science Foundation 7,472,215 6,652,888 7,339,525 7,311,083   7,472,000
National Institute of Standards and Technology, Manufacturing Extension Program 130,000 6,000 100,000 130,000   5,000*

*Agency/Program Termination Proposed

Agency Items of Note:

National Oceanic and Atmospheric Administration: The President’s Budget Request would cut NOAA Oceanic and Atmospheric Research by 37%. The PBR calls for a significant reduction to climate research. The NOAA Sea Grant program is proposed for elimination in the PBR.

Department of Defense: The PBR proposes a 19% increase to the Defense Advanced Research Projects Agency.

Department of Education: The PBR contains sufficient funds to maintain the current Pell Grant maximum award level of $5,920. Further, the document suggests expanding eligibility to “high-quality” short-term programs. The PBR suggests a nearly 50% reduction to the Federal Work Study program and would end graduate student eligibility. The document also proposes eliminating the Public Service Loan Forgiveness Program and subsidized Stafford Loans for undergraduate students.

The PBR proposes a reduction of 14% to the Institute of Education Sciences. Within IES, the PBR eliminates funding for the Regional Education Laboratories and the Statewide Longitudinal Data Systems programs.

Department of Energy: The PBR instructs the Office of Science to focus efforts on the early-stage research, operation of the national laboratories, and continuation of high-priority construction projects. The PBR calls for elimination of the Advanced Research Projects Agency Energy, as did the FY 2017 version.

Environmental Protection Agency: The PBR would cut the EPA Office of Science by 36.4%.

Health and Human Services: The PBR would reduce the HHS grantee salary cap from $187,000 to $152,000. Further, the proposal would cap the percentage of a scientist’s salary that could be paid from grants.

APLU President’s Budget Request Chart

President’s Budget Request for Fiscal Year 2019

Addendum to the Budget Request, Reflecting Bipartisan Budget Act of 2018

 

Jonathan Nurse

President's FY19 Budget Request for Research Agencies Largely Flat

Earlier today, the Trump administration released its budget request to Congress for Fiscal Year 2019. The release of a budget request is a largely symbolic step in the annual appropriations process. Actual agency and program spending levels are determined by Congress over the course of several months. Additionally, this year, the budget request put forward by the administration is somewhat undermined by the recently approved Bipartisan Budget Act of 2018, which provides $300 billion of relief from sequestration for Fiscal Years 2018 and 2019. The allocations in the president's budget request for FY 2019 were assembled over the course of the last year, largely before the recent budget agreement was reached. The administration did attempt to increase its requests for certain accounts, with new resources provided by the budget agreement, through the release of an addendum.

The initial materials circulated by the administration show largely flat funding requested for the major research agencies.The administration requests $7.472 billion for the National Science Foundation, which is the same as the FY 2017 level. The administration requests level-funding or approximately $33 billion for the National Institutes of Health, when funds detailed in its addendum are included. President Trump also requests level funding at $5.391 billion for the Department of Energy, Office of Science. However, the administration once again proposes eliminating the Advanced Research Projects Agency-Energy (ARPA-E). Additional details will be provided on the budget request in the days ahead.

Jonathan Nurse

Federal Budget Deal Reached

The Bipartisan Budget Act of 2018 has emerged from negotiations on Capitol Hill. The agreement provides two years (FY 2018 and 2019) of relief from sequestration with nearly $300 billion in funding above established spending caps. The bill also establishes a select congressional committee to develop legislation to reform the budget process, which has proven to be dysfunctional through a series of stopgap spending measures and government shutdowns over the last few years. The agreement locks in a $2 billion FY 2018 increase for the National Institutes of Health. The additional budget cap space should also allow for more favorable allocations for research agencies than seen earlier this year in the President's Budget Request and House Appropriations Committee-approved spending bills.

The legislation advanced on the Hill today provides only a framework for the FY 2018 budget and an additional time period (through March 23) for Congress to finalize appropriations for specific agency and program line-items. Packaged with the overarching budget provisions in the bill is emergency supplemental funding for disaster relief, suspension of the debt ceiling through March 2019, and health care items such as 10-year funding for the Children's Health Insurance Program.

Senate Appropriations Committee Statement

Statement of Senate Appropriations Committee Vice Chair

Legislative Text

CR Summary

Disaster Relief Summary

Jonathan Nurse

White House Preps Agencies for Shutdown

Given little progress in negotiations over the budget and other bundled policy matters, the White House has provided guidance to agencies on operations during a federal government shutdown. The document encourages agencies to review existing opinions on essential services and employees that will be maintained during a shutdown. A list of frequently asked questions and responses is also provided.

Office of Management and Budget Guidance

Federal Agency Contingency Plans

Jonathan Nurse

Government Shutdown Looms (Again)

The federal government is once again at the brink of a shutdown, as a mix of congressional Democrats and Republicans express opposition to another stopgap bill to fund the government.

Fiscal Year 2018 began back last October 1. Since Congress had not approved final appropriations for federal agencies at that point, the first of three stopgap spending measures known as a continuing resolution was approved to provide more time. Congressional leaders and appropriators wanted the additional time to negotiate a bipartisan budget framework that would raise the low spending caps, often referred to as sequestration, that were set to return this year as prescribed in the Budget Control Act of 2011 (BCA). In recent years, Congress acted in a bipartisan manner to ease the BCA spending caps so that favored discretionary programs could see sustained support. However, no such agreement has surfaced for FY 2018, despite ongoing negotiations. Without an agreement, agencies such as the National Science Foundation and the Department of Energy would likely see sharp funding reductions.

The need for legislation to provide a permanent status for the Deferred Action for Childhood Arrivals (DACA) population has been bundled with FY 2018 spending discussions. DACA advocates hope that combining the measures will make certain that a new policy is approved. Reauthorization of the Children's Health Insurance Program has similarly been linked to a final FY 2018 spending bill.

As we move into the fifth month of the fiscal year, representatives and senators are now taking a more firm stand by demanding that the various issues directly and indirectly related to FY 2018 spending be addressed now. The next few hours will reveal whether a government shutdown serves as a mechanism for finally addressing these unresolved issues.

Jonathan Nurse

Student Leaders Visit FSU Congressional Delegation

On January 10, SGA President Kyle Hill and other FSU student leaders took to Capitol Hill to meet with senators and representatives on federal funding and immigration issues. More specifically, the group discussed the need for congressional support for research funding at agencies such as the National Institutes of Health in order to continue opportunities for students and to make certain that our future scientific workforce is strong. The group also drew on personal stories to highlight the impact of student aid programs such as the Pell Grant and Federal Work Study. The need for a legislative fix to provide a permanent status for students impacted by the Deferred Action for Childhood Arrivals program was also discussed.

Kyle was joined by Alfredo Cortez (Treasurer), Joshua Hancock (Chief of Staff), and Jared Honts (Government Relations Director) from the SGA. FSU Federal Affairs also participated in the meetings.

The group met with Senators Nelson and Rubio as well as with staff to Representatives Neal Dunn and Al Lawson. Both Senator Nelson and Rubio noted their support for the programs discussed.

Jonathan Nurse

Tax Bill Becomes Law

Tax Bill Becomes Law

On December 21, Congress gave final approval to its sweeping tax reform bill. The final bill reflects the advocacy of students and other higher education advocates who quickly mobilized to beat back provisions that would have significantly increased the cost of a post-secondary education. For details on the provisions included in the final bill, see our December 18 post.

Going forward, additional outreach to the Hill will be necessary in order to highlight challenges resulting from the new law. Senators and representatives from both sides of the aisle have already indicated a need for follow-on legislation to correct problems caused by the hastily written legislation.

Jonathan Nurse

Tax Bill on Course for Final Passage

Strong advocacy by the higher education community appears to have yielded positive results in the form of key tax credits and deductions for students and institutions maintained in the final bill that will likely be approved this week. In a memo to higher ed. administrators, APLU President Peter McPherson captured the work that led to the more favorable outcome; "Your level of engagement on the tax bill, coupled with that of students and others in your university communities was truly impressive and ultimately effective. Without such effort, we clearly would not have made the kind of progress we did on our priorities."

While concerns remain with the tax reform package, such as how charitable giving will fare after the standard deduction is doubled and fewer individuals opt to itemize, it is far improved from the bill that emerged from the House of Representatives last month.

Excluded from the final tax bill:

  • Repeal of the exclusion for qualified tuition reductions, which many graduate teaching/research assistants rely on;
  • Repeal of the exclusion for employer-provided education assistance;
  • Repeal of the deduction for student loan interest;
  • Repeal of the Lifetime Learning Credit;
  • Treatment of university name and logo royalties as unrelated business income, subject to tax; and
  • Termination of private activity bonds that are used by private universities to finance campus construction project.

Included in the final tax bill:

  • Elimination of advance refunding bonds that public and private institutions use to refinance outstanding debt at lower interest rates, resulting in lower costs for capital projects;
  • Computation of unrelated business income tax (UBIT) for each activity as opposed to across an institution, allowing for offsets in tax liability;
  • Repeal of the deduction for 80% of donations that allow the right to purchase tickets to athletic events;
  • 1.4% excise tax on the net investment income on the endowments of roughly 30 private colleges and universities, those with endowments worth at least $500,000 per full-time student; and
  • Excise tax on certain compensation in excess of $1 million.

Related Resources:

Committee Summary

Joint Explanatory Statement

Committee Report

APLU Statement

Inside Higher Ed Recap

The Chronicle of Higher Education Recap

 

Jonathan Nurse

Final Tax Bill Emerging from Conference

House and Senate negotiators appear to be closing in on a final tax bill. Reports from the Hill indicate that the House-proposed tax on graduate tuition waivers and other provisions that would be harmful to the higher education community have been removed from the bill. Details on the final bill remain to be seen.

Jonathan Nurse