Federal Update: President Obama Releases FY17 Budget Request

February 9, 2016

The broad strokes of the President’s State of the Union address received their fine print today with the release of the White House’s fiscal year 2017 budget request. The Obama Administration’s last budget comes with the freedom from the political pressures of reelection to propose aspirational policies and the opportunity to steer the national discourse in a presidential election year, but it does not come with the time to accomplish much of significance. Illustrating the true depths of Congressional Republicans’ hostility to the President’s proposals and the mechanisms used to fund them, neither Senate Budget Chairman Enzi (R-WY) nor House Budget Chairman Price (R-GA) invited OMB Director Shaun Donovan to testify on the Hill—a government tradition since 1975.

As the Administration released details of its final budget request and outlined big plans to double clean-energy research funding and a “moonshot” initiative to cure cancer, Republicans expressed strong opposition to policies like a $10-per-barrel oil tax, all but declaring the budget a non-starter. Even in the face of strong opposition, President Obama is trying to build on significant moments of bipartisanship that occurred last year—namely the Bipartisan Budget Act, omnibus appropriations, and the House-passed 21st Century Cures bill, the last of which illustrated overwhelming congressional support for a new mandatory stream of funding for the NIH, an idea upon which the President expanded in his budget as a means to propose increases for research accounts in an otherwise flat budget year.

This commitment, alongside his many other proposals, required creative accounting. The President’s strategy blends slight cuts to base, discretionary funding with corresponding increases to mandatory funding. The result gives the appearance of increases without piercing the statutory spending caps. This kind of budgeting irks fiscal conservatives, but with more priorities than money to go around, the President has little choice to make his math work.

What follows is a general overview of the President’s budget request as it relates to Harvard priorities and below is a breakdown of recent funding history for some agencies and programs of particular University interest.

The President’s Budget Request

On the innovation side of the President’s budget, there is significant commitment to federal research across a variety of sectors, but with strong emphasis on climate and biomedicine. The budget asks for a total of $1 billion in mandatory funding for the “moonshot” to cure cancer, including $750 million in FY17 NIH and FDA funding. The popularity of a national commitment to curing cancer, coupled with bipartisan support for NIH and biomedical research, makes this one of the President’s more plausible requests. Conversely, President Obama’s Mission Innovation commitment to double American clean-energy research by 2021 ($6.4 billion to $12.8 billion) is unlikely to gain traction in a Republican Congress. That said, the President’s budget spreads this money across a variety of agencies, many of which are described as politically popular, such as the Advanced Research Projects Agency-Energy and NASA, leaving the door open for modest increases or simply avoiding cuts.

In the economic opportunity sphere, one of the largest initiatives is the President’s plan to spend $4 billion to offer “Computer Science For All.” The funding includes $100 million directly for districts and seeks to expand K-12 CS training for teachers and students dramatically and to cultivate regional partnerships. Rounding out the topline education items is a proposal to boost Pell with a $2 billion investment, reinstating year-round grants. The budget also calls for nearly $6 billion to fund the “First Job” initiative, which aims to jumpstart young Americans’ careers and professional development.

Selected Agency and Program Funding Requests

Looking Ahead

The decision by congressional Republicans not to invite Donovan could be a preview of an acrimonious, highly partisan election year in Congress, and as the fight over policy riders returns, a budget and appropriations process that was supposed to be simpler with funding caps already set, could once again fall into gridlock. Frustrating many Democrats, Chairmen Enzi and Price both will propose FY17 budgets that could lower the previously agreed upon caps. Their likely reasoning being a desire—especially among the hardline conservative Members—to return to transparency and regular order, neither of which were hallmarks of former Speaker Boehner’s leadership strategy.

After possibly advancing budget frameworks, Speaker Ryan and Majority Leader McConnell continue to express interest in passing all 12 individual appropriations bills, but that is highly unlikely before the next fiscal year begins October 1st. In the meantime, while the President’s budget will certainly not be taken verbatim, it serves as an important marker for debates with Congress over final decisions generally made late in each calendar year. This year, those decisions will almost assuredly be made after the November elections—weeks, if not months, after FY17 has already begun.

As the process moves along and the FY17 funding procedures become clearer, our government relations teams will remain engaged, advocating for Harvard’s priorities and sharing relevant news and intelligence as it becomes available.


As always, please feel free to reach out with any questions to Suzanne Day (suzanne_day@harvard.edu) or Jon Groteboer (jon_groteboer@harvard.edu) on Harvard’s Federal Relations team (DC: 202-863-1292).