HOUSE APPROPRIATIONS CMTE APPROVES R&D BUDGET RESCISSIONS

[David Farber <farber () central cis upenn edu>]

How to make the US a technological third world country ion two easy
lessions. Dave Farber


Date: Fri, 17 Feb 1995 16:05:56 -0800
To: farber () central cis upenn edu


IEEE-USA ELECTRONIC INFORMATION BULLETIN


No. 95-10, February 17, 1995




HOUSE APPROPRIATIONS COMMITTEE APPROVES
 R&D BUDGET RESCISSIONS


On Friday, February 10th, the House Appropriations
Committee, under the leadership of Rep. Bob Livingston (R-
LA), reported two bills, which included large R&D budget
rescissions, for approval by the full House.  The first bill
(H.R. 889) authorizes emergency supplementary
appropriations and rescissions at the Department of
Defense to fund unbudgeted military contingencies such as
operations in Haiti and to increase funding for military
readiness.  The second bill (H.R. 845) approves $1,402,140.00
in proposed FY 1995 budget rescissions, including cuts to R&D
programs at the Departments of Commerce and Energy and the
National Aeronautics and Space Administration.  Highlights
of each bill, including excerpts from committee report
language, follow:


H.R. 889, Report 104-29
=======================


Titles I and II of the Department of Defense (DoD) Emergy
Supplemental Appropriations and Rescissions bill (H.R. 889)
authorizes $3.2 billion in appropriations for defense
personnel, operations, and procurement to cover the
expenses of unbudgeted contingency operations and for
maintaining defense readiness.  To help offset these
supplemental appropriations, Title III of the bill outlines
$1.46 billion in proposed DoD budget rescissions, including
over $845 million in rescissions related to research,
development, test, and evaluation.   Broken down by service
area, H.R. 889 includes rescissions of $48 million for Army
RDT&E, $60.1 million for Navy RDT&E, $169.6 million for Air
Force RDT&E, and $567.6 million for Defense-wide RDT&E,
principally for programs supported by the Advanced
Research Projects Agency.  Specific cuts highlighted in the
Committee's report include:


TECHNOLOGY REINVESTMENT PROGRAM (TRP) --  The
Appropriations Committee recommended a total of $502
million in budget rescissions for the Technology
Reinvestment Program (TRP), with all rescissions to come
from the TRP's competitive grant program funded through the
Advance Research Projects Agency.  The rescission would
remove all but $17 million of the $443.2 million in FY 1995
appropriations for this program, as well as $77 million
in uncommitted FY 1994 TRP appropriations.  In approving this
rescission, the Committee specifically excluded other TRP-
related ARPA programs, including Advanced Materials
Partnerships, Agile Manufacturing, U.S. Japan Management
Training, and the MARITECH maritime technology initiative,
marking these as "items of special Congressional interest,"
which require prior Congressional approval to cut.


As rationale for defunding the TRP, the Committee report
notes:  "The TRP grant program's stated objective is to
ensure military security through the promotion of a strong
economic and industrial base.  However, it is not apparent
that program, which funds technology projects of a primarily
commercial nature whose military utility is tenuous at best,
is an effective means of doing so.  Since its inception in
fiscal year 1993, over $1.2 billion has been appropriated for
so-called 'dual-use,' TRP technology grant competitions.
Despite this significant level of funding, the Defense
Department has yet to identify any military benefits from
pursuing this program.  It is troubling to the Committee that
the TRP does not have parameters by which to define a
successful defense conversion project.  The Advanced
Research Projects Agency (ARPA) contends that it will take
several years to determine how successfully the TRP meets
its state objectives.  In the meantime, under the TRP grant
program Congress is expected to approve what is essentially
an open-ended funding commitment to programs which receive
grant awards since no 'exit criteria' exist which defines when
a defense-related firm or other entity has successfully
converted its defense technology to commercial
applications."


"The Committee is concerned that military participation in
the TRP is severely limited although the Defense Department
provides all the funding for the program....The Defense
Department is just one of many voices on the multi-agency
Defense Technology Conversion Council which oversees the
execution of the TRP."


"The record of defense conversion has not been a good one.
As one industry official succinctly stated, the record of
defense industry conversion to civilian applications is
'unblemished by success."  According to some estimates, past
attempts by defense contractors to enter commercial
markets resulted in economic failures of 80 percent....The
Committee believes the long term security and vitality of
the defense industrial base can be accomplished in other
ways not involving the expenditure of defense
appropriations for initiation of 'dual-use' projects without
clear benefits for the nation's defense effort....The
Committee believes a more appropriate role for the Federal
government is in the area of regulatory reform allowing
sensible business practices to more freely shape the down-
sized defense industry of the future.  Changes in Federal
policies, not new spending programs are needed to encourage
these actions of the free market."


"The rescission of funds for the TRP will not put an end to
the Defense Department's development of dual-use
technologies.  Much of the technology the Department
already develops can be considered dual use.  ARPA estimates
that 60 percent of its program already supports the
development of these technologies.  The Committee has
supported such programs in the past when their military
utility has been demonstrated and when they appear to
represent a cost-effect solution to issues confronting the
DoD.  For example, the Administration's high-performance
supercomputing initiative, championed by Vice President
Gore, clearly has military utility and received nearly $400
million in last year's Defense Appropriations Act.  Funds for
this program are not being recommended for rescission."


HIGH DEFINITION SYSTEMS --  "In fiscal year 1995, Congress
appropriated $82,950,000 to the Advanced Research
Projects Agency for research and development of high
definition systems technology.  After the Committee's
hearings were concluded, the Administration embarked on a
new initiative which greatly expanded and accelerated the
program.  The Committee believes that this initiative should
be subjected to additional oversight through the formal
hearing process.  The Committee therefore recommends a
rescission of $15,000,000...in order to moderate the growth
in high definition systems development until the requisite
hearings have been held and the Committee addresses this
program as part of the fiscal year 1996 budget process."


NATO RESEARCH AND DEVELOPMENT -- "The NATO Research and
Development program is a good example of a well intentioned
federal program which, once begun, never ends.  This
programs provides initial U.S. funding for international
cooperative research and development projects....over
$800,000,000 has been spent [since 1986] to start NATO R&D
projects, very few of which have actually resulted in
systems being fielded to U.S. troops, and all of which require
the military departments to find ways to finance the outyear
costs of the projects.  In today's defense environment,
where the services are being required to stretch out key
programs...it no longer is affordable to perpetually start
new NATO R&D projects.  The Committee therefore recommends
that this program be terminated and the $35,000,000 of funds
appropriated in the fiscal year 1995 'Research, Development,
Test and Evaluation, Defense-wide' appropriation be
rescinded.


The Committee also recommended rescissions of prior year
funding for the following programs which the Department of
Defense has targeted for termination or phase-out,
including:  the Tri-Service Standoff Attack Missile
(TSSAM)($319.5 million), the F-15 SEAD ($38 million), the
Advanced Cruise Missile ($33 million), and the EF-111 System
Improvement Program ($27.8 million).  $100 million of the $200
million dollar budget to support Defense Procurement Act
purchases is also targeted for rescission, as well as $80
million for the SR-71 "Blackbird" program and $150 million for
environmental restoration activities.


H.R. 845, Report 104-30
=======================


ADVANCED TECHNOLOGY PROGRAM -- The Appropriations
Committee recommended a rescission of $107 million from the
FY 1995 appropriation of $431 million for the Advanced
Technology Program administered by the Department of
Commerce's National Institute of Standards and Technology.
According to the Committee report, "The purpose of the ATP
is to provide assistance to U.S. businesses and joint
research and development ventures to help accelerate the
commercialization of high-risk technologies.  The Committee
is concerned about the rapid growth in ATP funding over the
past two years (a 535 percent increase in funding since
fiscal year 1993), and the ability of the Commerce Department
to have in place the necessary processes and administrative
structure to manage the volume of grant awards and evaluate
the program's success....This rescission of $107,000,000 does
not eliminate the Advanced Technology Program in its
entirety.  Rather, this reduction will slow the rate of
program growth to a still significant increase...This reduced
funding level will allow for a more thorough evaluation of
whether the program can successfully accomplish its stated
goals of expanding the commercialization of new technologies
and stimulating U.S. economic growth.  Given the funding
increases required in other critical areas of the Federal
budget, including the supplemental funding required by the
Department of Defense and addressed in accompanying
legislation [H.R. 889], an increase of the magnitude as
originally enacted for ATP simply cannot be sustained."


CLEAN COAL TECHNOLOGY -- The Appropriations Committee
recommended rescission of $200 million of the $2.75 billion
that has been appropriated for the Department of Energy's
Clean Coal Technology program, including $50 million in FY
1996 funding and $150 million in FY 1997 funding.  The
Committee "recommends this rescission with the anticipation
that not all of the current clean coal projects will be deemed
to be economically feasible and that some of the projects
will be abandoned prior to completion.  The Committee expects
the Department of Energy to honor its contractual
commitments to those projects which are in projects which
are in process and are economically viable."


NATIONAL WIND TUNNELS -- The Appropriations Committee
recommended rescission of $400 million in FY 1995
appropriations for construction of two new aeronautical
wind tunnel facilities by the National Aeronautics and Space
Administration.  These FY 1995 funds were originally
appropriated by the 103rd Congress contingent on the
Administration seeking an additional $400 million in its FY
1996 budget proposal and presenting a comprehensive wind
tunnel strategy, which the President's FY 1996 budget
request did not do.  The Appropriations Committee report
notes "the Committee has no assurance that the funds will be
augmented as required and therefore recommends the
rescission."




These measures await floor debate and a vote by the full
House, as well as Senate deliberation.




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