Federal Research and Development (R&D) Funding: FY2019

President Trump’s budget request for FY2019 includes approximately $131.0 billion for research and development (R&D), of which $118.056 billion is included in the President’s budget and an estimated additional $12.9 billion in nondefense discretionary R&D is requested as part of an addendum to the President’s budget. The additional funding requested in the addendum followed enactment of the Bipartisan Budget Act of 2018 (P.L. 115-123), which raised defense and nondefense discretionary spending caps for FY2018 and FY2019. In April 2018, the Administration issued amendments to the President’s request, including language needed to clarify the funds requested in the addendum. Agencies appear to have included this proposed funding in their budget justifications, and this funding is included in the agency analyses in this report. Final FY2018 funding had not been enacted at the time the President’s FY2019 budget was prepared; therefore, the budget included the FY2017 actual funding levels, 2018 annualized continuing resolution (CR) levels, and the FY2019 request levels. Subsequent to the release of the President’s budget, Congress enacted the Consolidated Appropriations Act, 2018 (P.L. 115-141), appropriating full-year funding for FY2018, rendering the CR levels identified in the budget no longer relevant. The analysis of government-wide R&D funding in this report preceding the individual agency analyses compares the President’s request for FY2019 to the FY2017 level. As information about the agencies’ FY2018 R&D levels becomes available, the agency sections of this report will be updated to reflect that information and to make comparisons to the President’s FY2019 request; some agency sections have been updated. As of the date of this report, the House had completed action on 6 of the 12 regular appropriations bills; the Senate had completed action on 9; 5 had been enacted as law. Division C of P.L. 115-245 provides for continuing appropriations for the agencies included in the remaining seven bills until December 7, 2018. This report will be updated as Congress acts to complete the FY2019 appropriations process. In FY2018, OMB adopted a change to the definition of development, applying a more narrow treatment it describes as “experimental development.” This approach was intended to better harmonize the reporting of U.S. R&D funding data with the approach used by other nations. The new definition is used in this report. Under the new definition of R&D (applied to both FY2017 and FY2019 figures), and including the estimated $12.9 billion included in the budget addendum, President Trump is requesting approximately $131.0 billion for R&D for FY2019, an increase of $5.7 billion (4.5%) above the FY2017 level. OMB notes that under the previous definition, total federal R&D would be $38.7 billion higher, or approximately $170 billion. Adjusted for inflation, the President’s FY2019 R&D request represents an increase of 1.2% above the FY2017 level. Funding for R&D is largely concentrated among a few departments and agencies. In FY2017, eight federal agencies received 96.3% of total federal R&D funding, with the Department of Defense (39.3%) and the Department of Health and Human Services (27.3%) combined accounting for more than two-thirds of all federal R&D funding. President’s Trump’s FY2019 budget is largely silent on funding levels for a number of multiagency R&D initiatives. However, some activities supporting these initiatives are discussed in agency budget justifications and are reported in the agency analyses in this report. The request represents the President’s R&D priorities; Congress may opt to agree with none, part, or all of the request, and it may express different priorities through the appropriations process. In recent years, Congress has completed the annual appropriations process after the start of the fiscal year. Failure to complete the process by the start of the fiscal year and the accompanying use of continuing resolutions can affect agencies’ execution of their R&D budgets, including the delay or cancellation of planned R&D activities and the acquisition of R&D-related equipment.