Federal Relations

May 23, 2017

New Foundation for American Greatness Budget for FY 2018

The Administration unveiled the New Foundation for American Greatness Budget which builds on the America First or blueprint or skinny budget released in March.

Similar to the previous Administration, the Trump Administration does address the sequester caps. Where the Obama Administation repeatedly proposed scaling back the spending caps on both military and domestic spending, Trump would relieve just the defense spending caps and decrease caps on discretionary spending.  Under Trump’s plans, nondefense discretionary spending would decrease by 2 percent each year, as part of his broader efforts to balance the budget by the end of the decade. The budget refers to those 2 percent nondefense cuts as a “two-penny plan.” The domestic spending cuts laid out in Trump’s budget would increase each year compared to the annual spending caps under current law: a $77 billion reduction below the cap in FY 2019, a $99 billion cut in FY 2020, reaching a $260 billion cut in FY 2027 – all levels are calculated as below projected levels under current law.

Overall, the Administration’s budget calls for $668 billion in defense spending, coming in $22 billion above current levels. The proposal would cut more than $1.5 trillion out of base nondefense spending programs over the next decade, while rolling back statutory budget caps to hike military spending by nearly $500 billion during the same period. The Administration would drop base domestic spending to $462 billion in FY 2018, with deeper cuts each year over the next decade until nondefense spending shrinks to $385 billion in FY 2027. Statutory limits on defense and nondefense discretionary spending are in place through FY 2021 under the 2011 deficit control law (Budget Control Act or the sequester).  Trump’s budget assumes that without his proposed changes, discretionary spending would continue to grow through FY 2027 at rates “consistent with current law,” according to the budget documents.

Proactive themes for the Administration include tax reform, federal workforce production and streamlining, continued regulatory reform and six weeks of paid family leave.

  • Federal workforce reduction will remain a priority while improving management and delivery of critical services; reducing work related towards compliance activities; letting manager adopt private practices for hiring and IT services; and hold agencies accountable for performance.
  • Continued regulatory reform will remain an issue via Executive Order 13777, “Enforcing the Regulatory Reform Agenda.” Within each agency a Regulatory Reform Officer and a Regulatory Reform Task Force to carry out the President’s regulatory reform priorities. These new teams will work hard to identify regulations that eliminate jobs or inhibit job creation; are outdated, unnecessary, or ineffective; or impose costs that exceed benefits.
  • The budget includes a proposal to increase mandatory spending by $25 billion during the next decade to establish paid family leave. The program, if approved by Congress, would include six weeks of paid family leave for all new parents, including those who adopt.

One important note, all summaries in the budget show FY 2017 numbers as the FY 2017 CR levels annualized–NOT the final levels in the FY 2017 omnibus. As a result, the cuts (or increases) presented in the text and tables are not accurate.

 

All GPO Budget information is here.

Budget Overview is here. 

Appendix with detailed budget estimates is here. 

Major Savings and Reforms are here. 

Fact sheets from the Administration:

Agency highlights are below.


Commerce

The President’s 2018 Budget requests $7.8 billion for the Department of Commerce, a $1.5 billion or 16 percent decrease from the 2017 annualized CR level. It maintains NOAA’s Polar Follow On satellite program, Joint Polar Satellite System (at a 10 percent cut) and Geostationary Operational Environmental Satellite programs, and the National Weather Service forecasting capabilities. Cuts are assessed to National Ocean Service ($24 million), Oceanic and Atmospheric Research, and National Weather Service.

Eliminations:

  • Eliminates the Minority Business Development Agency
  • Manufacturing Extension Partnership (MEP) program, which subsidizes up to half the cost of State centers, which provide consulting services to small- and medium-size manufacturers.
  • Eliminates $250 million in targeted National Oceanic and Atmospheric Administration (NOAA) grants and programs supporting coastal and marine management, research, and education including Sea Grant [Note: the NOAA budget specifics will not be released until next week.]

 

 

DOD

The President’s 2018 Budget requests $639 billion for DOD, a $52 billion increase from the 2017 annualized CR level. The total includes $574 billion for the base budget, a 10 percent increase from the 2017 annualized CR level, and $65 billion for Overseas Contingency Operations.

The Defense Health Program (DHP) provides care to current and retired members of the Armed Forces, their family members, and other eligible beneficiaries. The Defense Health Agency would be funded at $25.2 billion from $31 billion.

The Overseas Contingency Operations Fund has a request of $65 billion.

The Department of Defense (DOD) has approximately 20 percent excess infrastructure capacity across all Military Departments. The best way to eliminate DOD’s unneeded infrastructure is through the Base Realignment and Closure (BRAC) process. If the Congress authorizes DOD to begin a new round of BRAC in 2021, DOD estimates it could generate $2 billion or more in annual savings by 2027. These savings would be re-invested in higher priority DOD needs.

 

ED

The President’s 2018 Budget provides $59 billion in discretionary funding down from $68 billion in the FY 2017 Omnibus which is a ~14 percent cut.

The Administration would ramp school choice funding up to an annual total of $20 billion (from $1.4 billion), and an estimated $100 billion including matching State and local funds. This additional investment in 2018 includes a $168 million increase for charter schools, $250 million for a new private school choice program, and a $1 billion increase for Title I, dedicated to encouraging districts to adopt a system of student-based budgeting and open enrollment that enables Federal, State, and local funding to follow the student to the public school of his or her choice.  Maintains approximately $13 billion in funding for IDEA programs to support students with special education needs. Safeguards the Pell Grant program by level funding the discretionary appropriation, while proposing a cancellation of $3.9 billion from unobligated carryover funding, leaving the Pell program on sound footing for the next decade. The Budget supports year-round Pell Grant eligibility to allow students the opportunity to earn a third semester of Pell Grant support up to an additional 50 percent of their regular Pell Grant award during an award year in which they have exhausted their eligibility and enroll in additional coursework, ensuring that students can accelerate their studies and enter the workforce on time.

The budget does propose student loan reforms including consolidating the federal government’s more than half dozen income-based repayment programs into a single plan (proposed savings of at least $76 billion over the next 10 years); eliminating subsidized student loans (proposed savings of $39 billion over the next decade); and eliminating public service loan forgiveness (proposed savings of at least $27 billion over the next decade).

Reductions:

  • Federal Work-Study to $500 million from $990 million in FY 2017 Omnibus, a 50 percent cut/
  • Gaining Early Awareness for Undergraduate Programs (GEAR UP) to $219 million from $340 million in FY 2017 Omnibus, a 35.5 percent cut. Many of the services provided by GEAR UP are duplicative of other Department of Education programs, such as Talent Search (one of the five TRIO programs), and there is limited evidence that GEAR UP is effective at increasing college access and persistence of its participants.
  • TRiO to $808 million from $950 million in FY 2017 Omnibus, a 15 percent reduction.
  • GAANN to $6 million from $28 million in FY 2017 Omnibus, an 80 percent reduction.

Eliminates:

  • 21st Century Community Learning Centers program
  • Federal Supplemental Educational Opportunity Grant program
  • Comprehensive Literacy Development Grants
  • Supplemental Educational Opportunity Grant (SEOG)
  • International Education and Foreign Language Studies Domestic and Overseas Programs
  • Strengthening Institutions Program (SIP)
  • Student Support and Academic Enrichment Grants program
  • Teacher Quality Partnerships (TPQ)

 

ENERGY

The President’s 2018 Budget requests $28.0 billion for DOE with a focus on moving toward a responsive nuclear infrastructure and advancing the existing program of record for warhead life extension programs through elimination of defense sequestration for the National Nuclear Security Administration (NNSA). Ensures the Office of Science continues to invest in the highest priority basic science and energy research and development as well as operation and maintenance of existing scientific facilities for the community for a total of $4.47 billion from $5.392 billion in FY2017 Omnibus, a 17 percent cut. Within that Energy Efficiency and Renewable Energy, Fossil Energy, Nuclear Energy, and Electricity Delivery and Energy Reliability are all cut. The only program increased is Advanced Scientific Computing Research.

 

Eliminates:

  • Advanced Research Project Agency-Energy (ARPA-E)
  • Four applied energy research and development (R&D) program areas:
    • Energy Efficiency and Renewable Energy,
    • Fossil Energy,
    • Nuclear Energy, and
    • Electricity Delivery and Energy Reliability

 

HHS

The National Institutes of Health would face a $5.6 billion reduction from the previous fiscal year, reducing its budget to $26.9 billion from its $32.5 billion appropriation in FY 2017 a cut of $7.2 billion compared to the comparable figure from the FY 2017 omnibus, approximately 21 percent, which, would result in 1,946 fewer grants. Much of that savings would come from a $1 billion reduction to the $5.5 billion budget of the National Cancer Institute, the largest of the health research agency’s two dozen institutes. Most of the others would be similarly subject to cuts of around 20 percent, except for a $70 million international health research center that would be eliminated entirely. Also reduced is the National Coordinator for Health Information Technology (ONC) by reducing its budget by 36 percent.

 

The budget does propose a cap of 10 percent on indirect costs of the total grant starting in 2018.

 

The Centers for Disease Control and Prevention budget would see a $1.3 billion cut to around $5 billion from its discretionary total in FY 2017 of $6.3 billion. The savings would come from reductions for a variety of programs, but the steepest cuts would be to programs for environmental health, occupational safety, emerging infectious diseases, and prevention of HIV/AIDS and other chronic diseases.

Eliminates:

  • Agency for Healthcare Research and Quality’s (AHRQ)
  • Fogarty International Center
  • Community Services Block Grant (CSBG)
  • Food and Drug Administration (FDA) medical product user fees
  • health professions and nursing training programs (HRSA Title VII and VIII)
  • National Institute for Occupational Safety and Health (NIOSH)

 

DHS

The President’s 2018 Budget requests $44.1 billion with $314 million to recruit, hire, and train 500 new Border Patrol Agents and 1,000 new Immigration and Customs Enforcement law enforcement personnel in 2018, plus associated support staff.  It provides an additional $1.5 billion above the 2017 annualized CR level for expanded detention, transportation, and removal of illegal immigrants. Invests $15 million to begin implementation of mandatory nationwide use of the E-Verify Program, an internet-based system that allows businesses to determine the eligibility of their new employees to work in the United States.  Safeguards cyberspace with $1.5 billion for DHS activities that protect Federal networks and critical infrastructure from an attack.

Restructures selected user fees for the Transportation Security Administration (TSA) and the National Flood Insurance Program (NFIP) to ensure that the cost of Government services is not subsidized by taxpayers who do not directly benefit from those programs.

Eliminates or reduces State and local grant funding by $667 million for programs administered by the Federal Emergency Management Agency (FEMA) that are either unauthorized by the Congress, such as FEMA’s Pre-Disaster Mitigation Grant Program, or that must provide more measurable results and ensure the Federal Government is not supplanting other stakeholders’ responsibilities, such as the Homeland Security Grant Program. For that reason, the Budget also proposes establishing a 25 percent non-Federal cost match for FEMA preparedness grant awards that currently require no cost match.

Eliminates and reduces unauthorized and underperforming programs administered by TSA in order to strengthen screening at airport security checkpoints, a savings of $80 million from the 2017 annualized CR level. These savings include reductions to the Visible Intermodal Prevention and Response program, which achieves few Federal law enforcement priorities, and elimination of TSA grants to State and local jurisdictions, a program intended to incentivize local law enforcement patrols that should already be a high priority for State and local partners. In addition, the Budget reflects TSA’s decision in the summer of 2016 to eliminate the Behavior Detection Officer program, reassigning all of those personnel to front line airport security operations.

 

DOI

The President’s 2018 Budget requests $11.6 billion for DOI with a focus on reducing federal land acquisition.

Eliminates:

  • Heritage Partnership Program
  • National Wildlife Refuge Fund

 

STATE

The President’s 2018 Budget requests $25.6 billion in base funding for the Department of State and USAID, and cuts by half funding the Department of State’s Educational and Cultural Exchange Programs, including the Bureau of Educational and Cultural Affairs (ECA). Global health programs are cut by $2 billion from FY 2017 CR levels by eliminating funding in the Global Health Programs account for international family planning programs and additional reductions below the 2017 CR level for tuberculosis, nutrition, vulnerable children, and neglected tropical diseases.

Eliminates:

  • Global Climate Change Initiative
  • USAID Development Assistance account

 

EPA

The President’s 2018 Budget requests $5.7 billion for the Environmental Protection Agency with a focus on reducing enforcement activities, particularly where there is overlap with state agencies. EPA STAR grants  receive $249 million a 50 percent cut.

 

Eliminates:

  • Energy Star
  • Geographic Programs for a variety of ecosystem protection activities within specific watersheds, including the Great Lakes, Chesapeake Bay, Puget Sound, and others

 

NASA

The President’s 2018 Budget requests $19.1 billion for NASA. It provides $1.8 billion for a focused, balanced Earth science portfolio that supports the priorities of the science and applications communities, a savings of $102 million from the 2017 annualized CR level. The Budget terminates four Earth science missions (PACE, OCO-3, DSCOVR, Earth-viewing instruments, and CLARREO Pathfinder) and reduces funding for Earth science research grants. It eliminates the $115 million from the Office of Education to fund it at $37 million, resulting in a more focused education effort through NASA’s Science Mission Directorate.

 

NSF

The Budget proposes a reduction of 11 percent to National Science Foundation (NSF) grant programs to $6.652 billion from FY2017 Omnibus $7.472. Cuts in every directorate across the board.

 

National Science Foundation
Summary Table 

FY 2018 Budget Request to Congress
(Dollars in Millions)
FY 2016
Actual
FY 2017
Annualized
CR
FY 2018
Request
FY 2018 Request change over
FY 2016 Actuals
NSF by Account Amount Percent
BIO $723.78 $672.11 -$51.67 -7.1%
CISE 935.20 838.92 -96.28 -10.3%
ENG 915.68 833.49 -82.19 -9.0%
Eng Programs 727.16 –  657.28 -69.88 -9.6%
SBIR/STTR 188.52 –  176.21 -12.31 -6.5%
GEO 876.51 783.31 -93.20 -10.6%
MPS 1,348.78 1,219.43 -129.35 -9.6%
SBE 272.20 244.02 -28.18 -10.4%
OISE 49.07 44.02 -5.05 -10.3%
OPP 448.87 409.18 -39.69 -8.8%
IA 426.57 315.74 -110.83 -26.0%
U.S. Arctic Research Commission 1.43 1.43
Research & Related Activities $5,998.09 $6,022.18 $5,361.65 -$636.44 -10.6%
Education & Human Resources $884.10 $878.33 $760.55 -$123.55 -14.0%
Major Research Equipment &
Facilities Construction
$241.50 $199.93 $182.80 -$58.70 -24.3%
Agency Operations & Award
Management
$351.11 $329.37 $328.51 -$22.60 -6.4%
National Science Board $4.31 $4.36 $4.37 $0.06 1.5%
Office of Inspector General $14.76 $15.13 $15.01 $0.25 1.7%
Total, NSF $7,493.86 $7,449.30 $6,652.89 -$840.98 -11.2%