DC Digest – May 23, 2017

In Today’s Issue:
  • FY18 Budget Proposal
  • AHCA CBO Score Expected

TRUMP BUDGET RELEASED

The administration released its full budget request for FY 2018 today and immediately met strong, bipartisan opposition on Capitol Hill. The full budget adds greater detail to the budget blueprint, or “skinny budget” released in March, but maintains the austere budgetary outlook.

Below are highlights of the top line FY 18 budget levels for programs of interest to the Duke community and are compared to the FY 17 final funding levels of the recently passed omnibus.  Please contact the Office of Government Relations should you have questions or want additional information about specific programs not included below.

A Note of Caution

As with all budget notes, the Office of Government Relations advises caution and patience. Health and research funding have strong, well-placed, bipartisan support in Congress and those legislators have already begun rebutting many of the steep cuts detailed below. This budget proposal is less a view of the future than it is an insight to the worldview of a nascent administration. As Franklin D. Roosevelt once said…

The President Proposes, but the Congress Disposes

National Institutes of Health:  The budget request proposes $26.9 billion in FY 18 for NIH, $7 billion or 21.5% below FY 17. A few items of note:

  • $496 million for 21st Century Cures
    • $86 million for BRAIN Initiative
    • $100 million for Precision Medicine
    • $300 million for Cancer Moonshot
    • $10 million for Regenerative Medicine
  • $594 million for National Institute of Environmental Health Sciences (25% cut from FY 17)
  • Elimination of Fogarty International Center
  • A proposed cap on F&A (indirect cost) rate: 10% of total research.  This cap would be imposed in tandem with various efforts to reduce regulatory burden. See more on F&A below.

National Science Foundation:  $6.65 billion for NSF, roughly 11% below the FY 17 funding level.

Department of Defense Basic Research:  $2.2 billion for basic research programs at the DOD,  roughly the same level as FY 17.

DARPA: $3.17 billion for DARPA in FY 18, an almost 8% increase over FY 17.

Department of Energy Office of Science:  $4.47 billion for the Department of Energy’s Office of Science, a 17% reduction from FY 17.

ARPA-E: Eliminates ARPA-E.  The budget request includes $20 million for closeout activities, supplemented by $45 million in prior year unobligated balances to ensure full closure by mid-2019.

NASA:  The Science Directorate would receive $5.7 billion, roughly the same as FY 17.

Department of Homeland Security:  $627 million for the Department of Homeland Security Science and Technology Directorate in FY 18, a 21.7% reduction from the FY 17.

EPA: $450.8 million for Science and Technology programs within EPA, a 36% reduction from FY 17.

National Endowment for the Humanities:  Eliminates the NEH, providing $42 million this year to begin shutdown activities.

Pell Grants:  The proposed Pell Grant Maximum Award for FY 18 is $5,920 and year-round Pell is maintained.  The budget proposes to provide inflationary increases for the Pell maximum award in order to pay for year-round Pell.

Supplemental Educational Opportunity Grants: Eliminates SEOG in FY 18.

Student Loans:  The FY 18 budget proposes several reforms to federal student loan programs, including:

  • Consolidation of several income-based repayment plans into single plan
  • Elimination of subsidized loans
  • Elimination of loan forgiveness plans for public service

International Education:  Eliminates the Title VI International Education programs, stating that other agencies are better equipped to support this mission.

Graphic Content…

Here are some helpful graphics to better visualize the steps being proposed.

Update on Proposed Cuts to Facilities and Administrative Costs (F&A) 

University facilities and administrative (F&A) costs were raised again last week at an NIH budget hearing before the House Labor-HHS-Education Appropriations Subcommittee. In response to questions from subcommittee members, Francis Collins, Director of the National Institutes of Health (NIH) said that cuts to F&A would be viewed by the research community as cuts to essential research costs. He also stated that university leaders continue to tell him that they are already subsidizing the research they perform for the NIH, in part because of the costs associated with complying with increasing federal regulations.  

In addition, Duke University Associate Vice President of Finance James D. Luther is testifying to the House Committee on Science, Space, and Technology Wednesday, May 24 on the Overhead Costs of Research. Similarly, President Brodhead will be on Capitol Hill Wednesday to meet with lawmakers and share his experiences running a large research and education enterprise.

NEW CBO SCORE ON AHCA

On Wednesday, May 23 the Congressional Budget Office is expected to release its long-awaited report on the GOP’s health care bill, American Healthcare Act (AHCA). It’ll give an estimate of how many people will lose coverage and how the bill would impact the budget. The AHCA has been amended since the CBO’s earlier analysis, which found that 24 million people would lose insurance under the previous, unsuccessful version of the AHCA.