Federal Update: Congress Moves on Final FY22 Appropriations

March 10, 2022

Nearly halfway through the fiscal year, Congress is on the verge of completing legislation providing $1.5 trillion of discretionary funding for FY22, with the House passing (in two votes of 361-69 and 260-171) the omnibus bill late Wednesday and the Senate preparing for approval either Friday or this weekend. The bipartisan agreement consists of all 12 FY22 spending bills and supplemental funding to support Ukraine. With government funding scheduled to expire on March 11, Congress may also pass, if needed, a four-day continuing resolution to give the Senate additional time to complete the omnibus legislation and avoid a federal shutdown. With the successful conclusion of the FY22 process, Congress and the Administration will turn their attention to the FY23 process, the competitiveness legislation, and the latent effort to revive a narrow version of the Build Back Better Act.

FY22 Funding Outcomes

After months of disagreement over topline spending levels, the omnibus package includes $730 billion for nondefense spending, a 6.7 percent – or $46 billion – increase over FY21. Although this is lower than the President’s requested level of $770 billion, it is the largest increase in nondefense spending in four years. Facing demands from Republicans and defense hawks for “parity” for defense spending, the package appropriates $782 billion for this purpose, an increase of $42 billion – or 5.6 percent – over FY21. In addition to annual funding, the legislation also includes $13.6 billion in emergency aid to Ukraine, and a few ride-along legislative provisions, like the long-stalled reauthorization of the Violence Against Women Act. In a last-minute change, House members did force leadership to drop additional COVID-19 relief and pandemic preparedness funding because of concerns that this support had been pared back too far and was mostly reliant on repurposing earlier COVID relief funding; so this will remain unfinished business.

On University priorities, the omnibus package provides strong funding, including for NIH (+$2.25 billion, or 4.5 percent increase), Pell (+$400, the single largest one-year increase in a decade), and NSF (+$350 million, or 4 percent increase). Of particular note, the package provides $1 billion to establish ARPA-H within the HHS Office of the Secretary to accelerate the pace of scientific breakthroughs for serious diseases, which is a signature priority for President Biden. And it establishes a new Directorate for Technology, Innovation, and Partnerships at NSF to focus on use inspired research in AI, quantum, and climate science. Below is a chart that details funding for various programs important across the campus.

 

 

Final FY21

Final FY22

FY22 v FY21

 

 
   

Labor-HHS-Education

 

 

 

   

NIH

42934

44959

4.7%

   

Pell Grants (Discretionary Funding)

22475

22475

0.0%

   

Pell Grants (Max Grant)

6495

6895

6.2%

   

Federal Perkins Loans

 

 

 

   

Work Study

1190

1210

1.7%

   

SEOG

880

895

1.7%

   

TRIO

1097

1137.0

3.6%

   

GEAR UP

368

378

2.7%

   

Title VI

78.2

81.7

4.5%

   

GAANN

23.5

23.5

0.0%

   

Institute of Education Sciences

642.5

737.0

14.7%

   

Institute of Museum and Library Services

257.0

268

4.3%

   

Commerce-Justice-Science

 

 

 

   

NSF -Total

8486.8

8838

4.1%

   

NSF- Research and Related

6909.8

7159.4

3.6%

   

NSF - Major Research Equipment

241

249

3.3%

   

NSF - Ed & HR

968

1006.0

3.9%

   

NASA -Total

23271.3

24041.3

3.3%

   

NASA - Science

7301

7614.4

4.3%

   

NASA - Aeronautics

828.7

880.7

6.3%

   

NASA - STEM Engagement

127

137

7.9%

   

Defense

 

 

 

   

6.1 Basic Research

2671.5

2763.5

3.4%

   

6.2 Applied Research

6446.1

6908.2

7.2%

   

DARPA

3571.3

3870

8.4%

   

Energy and Water

 

 

 

   

Office of Science - Total

7026

7475

6.4%

   

High Energy Physics

1046

1078

3.1%

   

Nuclear Physics

713

728

2.1%

   

Basic Energy Sciences

2245

2308

2.8%

   

Biological and Envir. Research

753

815

8.2%

   

ARPA-E

427

450

5.4%

   

Interior-Environment

 

 

 

   

NEA

167.5

180

7.5%

   

NEH

167.5

180

7.5%

   

EPA S&T

729.3

750.2

2.9%

   

 

 

FY23 President’s Budget

With FY22 mostly settled, there are indications that the President’s FY23 budget request may be released in late March/early April, but an exact date has not been confirmed. Although this timeline is an improvement over President Biden’s first full budget, which was submitted on May 28, 2021, this late start will exacerbate the delays already expected in the process during a highly political year with the midterm elections in November. That said, the delay will likely allow the Administration to propose agency and program level funding that is based on the final resolution of the FY22 process, instead of relying on FY21 as its baseline.

Competitiveness Package

In his State of the Union Address, President Biden urged Congress to complete its work on reconciling the Senate’s US Innovation and Competition Act and the House’s America COMPETES Act, which fund domestic semiconductor manufacturing, establish ambitious funding targets for the federal science and engineering agencies, like the National Science Foundation, and improve supply chain resiliency. Although the President was mainly focused on the semiconductor sector, the bills are central to his efforts to authorize greater investment in U.S. research and development and to counter competition from China and elsewhere. Generally, the semiconductor and the science investments are bipartisan, but there are difficult issues to resolve on trade and foreign policy, immigration, and science, including security issues, like foreign gift and contract reporting, and the distribution of competitive research funds. Negotiations are just beginning at the staff level, but this will likely be the next big package considered by Congress.

It is worth noting that the FY22 funding levels for the agencies included in the omnibus package, including NSF, DOE, and NIST, fall below the targets established in the House or Senate competitiveness bills. Although authorization and appropriations processes have always been separate, many hope that a bipartisan agreement on robust funding targets could help drive increased appropriations in FY23 and beyond, even if the control of one or both chambers changes at the midterm.

Build Back Better

Although the Build Back Better reconciliation bill, as envisioned and passed by the House, is dead, there is renewed interest by Democrats in revisiting a social spending package with a focus on addressing inflation. Senator Joe Manchin (D-WV), who was an obstacle on the larger House bill, laid out a version of the reconciliation bill that would focus on lowering the cost of prescription drugs, providing support for alternative energy and climate change, and attention to deficit reduction. He also is interested in reforming the tax code, saying that the 2017 reforms were unfairly weighted in favor of the wealthiest and corporations. In his State of the Union address, President Biden urged Congress to advance a revised package, which he recast as an opportunity to rein in the debt as well as invest in families. Many expect to know more about the prospects for and contents of the package in the coming weeks, with consideration possible in May or June.

Contact

As always, Harvard’s DC-based federal relations office will remain closely engaged in support of University priorities. If you have any questions, please feel free to reach out to Suzanne Day (suzanne_day@harvard.edu) or Kara Haas (kara_haas@harvard.edu).