Issue Date: May 21, 2007
THE FEDERAL GOVERNMENT spends tens of billions of dollars each year to support research and development activities at universities, colleges, and other institutions. But with the growing constraints on federal spending that cap discretionary funding and the increased demands from the scientific community for those limited funds, sustaining vigorous R&D with federal funds is increasingly challenging. This situation is forcing institutions to look to infusions from industry, state governments, and other funding sources.
The changing funding structure took center stage at this year's Forum on Science & Technology Policy held by the American Association for the Advancement of Science, in Washington, D.C., in early May. The 32nd annual meeting brought together hundreds of people involved in science policy to share information on the federal R&D budget, state R&D funding, and the need for better science advocacy.
Kicking off the two-day forum was John H. Marburger III, director of the Office of Science & Technology Policy. Marburger discussed details of the Bush Administration's proposed fiscal 2008 budget and its implications for science, but he also stressed the need for the science community to develop a consensus on key policy issues.
"The advocacy that we perform individually or through our institutions or professional societies shapes the actions of government, whose impacts spread throughout society," Marburger said. He noted that there is no guarantee that real-life science practice will reflect even a sensible science policy, but having coherence in a national science posture in which "all the diverse actors agree on a general direction and give it priority year after year" is key.
An example of an area of consensus that has emerged, Marburger said, is the importance of increased federal funding to support the physical sciences and ensure the nation's long-term economic competitiveness. As a result of the community's push, he explained, the Administration responded last year with the American Competitiveness Initiative (ACI). The program proposes to, among other things, double the budgets for the National Science Foundation, the Department of Energy's Office of Science, and the National Institute of Standards & Technology over the next decade.
Since its rollout, ACI has enjoyed broad congressional support, though the 109th Congress failed to pass key legislation and full appropriations for the nascent initiative, Marburger pointed out. He added that the 110th Congress is working on bills to support ACI and that the President's fiscal 2008 budget aims to get the funding levels back on track.
Even with ACI helping to boost basic funding for the physical sciences, overall federal funding for research is down in the proposed 2008 budget, said Kei Koizumi, director of the R&D Budget & Policy Program at AAAS. On the other hand, he noted that funds for development are up in the proposed 2008 budget, thanks to a continued commitment by the Administration to the Department of Defense for weapons development and to the National Aeronautics & Space Administration for spacecraft development.
There was general agreement that Congress will have little power to improve the federal R&D funding situation because the discretionary budget is itself being squeezed. The tight budget environment means that Congress is operating under a zero-sum game in which adding money to one program means cutting it from another. And this means that researchers need to rethink where they look for money.
"I believe we can do all the R&D we need to do and very much of what we want to do," Marburger said. "But I do not believe we can accomplish this the way we would like to do it, namely by simply appropriating more federal funds."
ONE AREA of research that is already seeing the need for alternative funding sources is biomedical work supported by the National Institutes of Health. After a five-year budget-doubling run that ended in 2003, NIH's budget has leveled off.
"The doubling of the NIH budget was an experiment in the rapid expansion of a broad but still well-defined scientific field," Marburger said. He pointed out that the abrupt increase in research capacity has created an enlarged biomedical R&D labor pool, which is now seeking federal support for its work.
"I cannot see how such an expansion can be sustained by the same business model that led to its creation," he noted. "The new researchers will either find new ways to fund their work or leave the field and seek jobs in other sectors of the economy."
To avoid the latter situation, Marburger told the audience, universities are experimenting with new revenue sources. "Under the pressure of increased competition for federal funds, research universities are in fact forging new relationships with private sponsors, and I expect this to continue," he said.
Representatives from research universities agreed, citing various options for R&D support beyond the federal government. Universities must think creatively to solve budget problems and grow support for academic research, said Mary Sue Coleman, president of the University of Michigan.
According to Coleman, "universities have three great partners waiting to be courted." One such partner is fellow universities and colleges. She noted that schools must overcome their competition with one another and team up in small collectives. Forming such collectives allows research universities to leverage their resources to generate a higher impact in creating knowledge and jobs.
Another funding source that universities must make better use of is industry, Coleman said. Industry already makes up nearly 66% of the nation's total R&D support, although little of this goes to fund basic and applied research at universities.
Coleman acknowledged that things are done differently in academia and industry, but said these differences can be overcome if each side clearly represents its interests. She said universities must be proactive in this area and tap into this prime revenue source.
The final funding source that universities must partner with is the public, Coleman explained. She underscored the need for universities and their researchers to do a better job explaining the impacts of their work. She also noted the importance of demonstrating to the public the return on investment of federal funds.
In addition to the groups outlined by Coleman, several other forum presenters noted that state governments are becoming more active in funding science and technology.
"An increasing number of states are investing in research," said Mary Jo Waits, director of the Pew Center on the States. Waits, who is helping to put together a soon-to-be released report on this topic for the National Governors Association, told the audience that the approach states are using toward supporting R&D has evolved during the past 25 years to the point that states are creating their own assets.
Waits pointed out that although states may be spending what they consider to be a large portion of their budgets on R&D, it's still a small amount compared with federal and industrial R&D funding. But it's not about how much money the states are spending, she said, it's about how the money is being used. For example, she noted that states can encourage innovation by looking beyond just funding research and instead provide venture capital funds or invest in new research facilities.
To support R&D, Waits said, states can use several mechanisms. For example, states can invest in R&D with earmarked tax dollars, general appropriations, tax incentives, or tobacco settlement money. In the end, states must do all they can to create a "habitat for innovation" if they want to ensure economic success, she explained.
Underscoring Waits's views, Thomas J. Bowles, science adviser to New Mexico Gov. Bill Richardson, told the audience, "States must invest in innovation for a healthy future." He noted that for a state to drive innovation, it must provide stable funds for R&D over several years, be flexible in allowing the institutions receiving money to remain in control of what they do with the money, provide incentives, and take advantage of the state's existing science and technology strengths.
It's the last point that can help a particularly motivated state set itself apart from the pack. For example, about 44 states have programs in the life sciences, and not all of them can excel in the field, explained Richard Bendis, former president and chief operating officer of Innovation Philadelphia, an initiative to spur technology and a knowledge-based economy in the area.
Because of this broad competition, Bendis noted that a state must find its own niche that plays to its unique strengths. He advised that each state should focus its efforts on a limited number of areas in which it can be a leader. For instance, he noted that Pennsylvania is concentrating on five core areas: biotechnology, nanotechnology, energy, manufacturing, and telecommunications and information technology.
STATES SHOULD also work together to leverage resources in much the same way Coleman advised universities to do, said William C. Harris, president and chief executive officer of Science Foundation Arizona, a new nonprofit group set up to support science and technology in the state. Harris described how regions could pool their expertise to be more competitive.
Advocacy by the science community is also an important component for cultivating strong state R&D support. Harris and Bowles both stressed the need for researchers to avoid just going to legislators and the public to ask for money. Instead, they and others called on the scientific community to help legislators and the public understand issues and the return on investment of R&D support at the local level.
As universities begin experimenting with mixed revenue sources that include federal, state, and private sources, the links between the parties deserve more study, Marburger said. The links "appear to be building on foundations formed by federal funding, and there is no question that they could grow if encouraged by federal policies," he noted.
"Of all the policy issues to be discussed in today's forum," Marburger said, finding ways to bridge the gap between exponentially increasing research capacity and the much more slowly growing federal ability to satisfy it "will be with us for the longest time and will have the greatest impact on how and what research is performed in our institutions."
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