Federal R&D Funding by Budget Function: Fiscal Years 2009–11
This annual report contains information on the budget authority (defined below) of U.S. federal agencies to fund the research and development and R&D plant components of their programs in FY 2011 and the two previous fiscal years. The figures for FY 2011 are the administration's proposed funding levels, based on the President's Budget of the United States Government, Fiscal Year 2011, agency documents, and Office of Management and Budget data through May 2010. These figures are the basis for subsequent congressional budgetary action.
The figures for FY 2010 are preliminary, reflecting agency estimates of the final appropriations for the year. Data reported here as proposed or preliminary will be revised in subsequent editions of this report to reflect later congressional appropriation actions and agency program-funding decisions.
The data for FY 2009 are actual budget authority received by the federal agencies for R&D that year. These figures do not, however, include estimates for R&D funds appropriated through the American Recovery and Reinvestment Act (ARRA). ARRA funds are presented in the data tables in a separate column. Although ARRA funds were appropriated in FY 2009, agencies have until the end of FY 2010 to obligate them. Some program-funding decisions are still being made; thus, the ARRA funding figures published here are preliminary.
Several concluding tables provide aggregate data on actual federal budget authority for R&D by broad function for FY 2008 and earlier years.
The R&D data in this report are classified into 16 functional categories. With one exception (see "Budget Functions," below), these are the same federal budget function categories in the Budget of the United States Government, Fiscal Year 2011, prepared by the Office of Management and Budget (OMB). This is the first report in the annual series in which R&D is reported for Medicare (function 570). No R&D was appropriated or authorized for general government (function 800) for FY 2009–11, as was the case in the last report. In previous years, small amounts of R&D were authorized for this budget function.
Research, Development, and R&D Plant
In this report, R&D refers to basic research, applied research, and development activities in the sciences and engineering.
Research is systematic study directed toward fuller scientific knowledge or understanding of the subject studied. Research is classified as either basic or applied according to the objective of the sponsoring agency.
Development is defined as systematic application of knowledge or understanding, directed toward the production of useful materials, devices, and systems or methods, including design, development, and improvement of prototypes and new processes to meet specific requirements. It excludes quality control, routine product testing, and production.
Funds for conducting R&D include those for personnel, program supervision, and administrative support directly associated with R&D activities. Expendable or movable equipment needed to conduct R&D, for example, microscopes or spectrometers, is also included.
R&D plant includes such R&D facilities as reactors, wind tunnels, or particle accelerators or the construction, repair, or alteration of such facilities.
This report excludes all non-R&D activities performed within budget functions that conduct R&D and all functions in which no R&D is conducted.
Budget Authority, Obligations, and Outlays
The federal R&D funding data presented here, with a few noted exceptions, are provided in terms of budget authority. Budget authority is used because it is the initial budget parameter 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.
All activities covered by the federal budget, including R&D, are classified into 20 broad functional categories. The federal budget total comprises funding for these 20 functions. Four federal budget functions—Social Security (function 650), net interest (function 900), allowances (function 920), and undistributed offsetting receipts (function 950)—have never reported R&D components. Consequently, they are not discussed in this report, except where R&D is described as a proportion of total federal budget authority.
An agency's programs typically are distributed across functions, and each function often includes programs from multiple agencies (see appendix A). All funding is assigned to a single function, that is, there is no overlap among functions or among the various agency programs within those functions. In a few cases, components of a major national effort are funded through multiple functions, such as the human genome activities, which are funded under the health and general science categories.
Notably, each specific R&D activity is assigned to only one function area, consistent with the official codes used in budget documents, even though the R&D activity may address several functional concerns. For example, except for those of the U.S. Army Corps of Engineers, all R&D activities sponsored by the Department of Defense (DOD) are classified as defense, even though some activities have secondary objectives, such as space or health. Moreover, only R&D activities funded by the Department of Health and Human Services, the Department of Labor, and the Consumer Product Safety Commission are classified in the health function category. Yet some R&D funding from at least three additional agencies—the Departments of Defense, Energy, and Veterans Affairs—has a major health component.
The functional categories and definitions used in this report are the same as those used in the federal budget, with one exception. R&D activities categorized as general science, space, and technology (function 250) are reported in separate categories here. Subfunction 251 contains R&D activities for general science and basic research, and subfunction 252 contains R&D activities for space research and technology. However, not all federally sponsored basic research is categorized in subfunction 251; some basic research is included in 12 of the remaining 19 functional categories.
Appendix A lists the name and function code of the 16 individual R&D functions funded by federal agencies.
The overall federal budget does not have a separately identified R&D budget, nor are most appropriations for R&D so labeled except in the case of certain program areas, such as defense, energy, health, and environment. Consequently, most funds for R&D are not line items in agency budget submissions but are included within general program funding. To determine funding for federal R&D, OMB requires agencies with annual R&D funding greater than $10 million to submit data on their R&D programs as part of their annual budget submissions. Specifically, the agencies provide data on funding levels for basic research, applied research, development, R&D facilities, and capital equipment for R&D, reported in accordance with OMB Circular A-11, MAX Schedule C, "Research and Development Activities."
The data in this report represent agencies' best estimates of actual and proposed federal funding for R&D collected during the period between February and May 2010. These data are based primarily on information provided to OMB by 26 agencies and account for an estimated 99% of all federally sponsored R&D activities. Also included in this report is R&D information that became available from individual agencies after the administration's budget was prepared and reported in the Budget of the United States Government. This information consists of budget justification documents that agencies submit to Congress and supplemental, program-specific information obtained from agency budget and program staff through May 2010.
The FY 2010 data reflect agency estimates of final 2010 appropriations based on agency documents and OMB data through May 2010. FY 2010 supplemental appropriations were included in this report; therefore, budget numbers for individual activities, programs, or agencies may differ slightly from those published in the President's budget or in agency budget documents.