Special Federal Budget Issue: Department of Commerce

The Administration's FY 2006 $9.4 billion discretionary budget request for the Department of Commerce reflects a 48 percent increase above FY 2005 estimated expenditures of $6.33 billion. If one excludes the proposed $3.71 billion Strengthening America's Communities Grant Program (see description under Multi-Agency Initiatives above), the agency is actually facing a 5.6 percent cut of more than $357 million. NIST would bear the brunt of the cuts through reduction of the Manufacturing Extension Partnership and elimination of the Advanced Technology Program.

The Economic Development Administration (EDA) currently provides grants to states, regions and communities to help create wealth and minimize poverty by promoting a favorable business environment to attract private capital investments and high skill, high wage jobs. The FY05 appropriation was $284 million, a 10 percent reduction from the FY 2004 level. Staffing levels, on the other hand, rose 13.2 percent in FY05. Recently reauthorized by Congress, EDA's FY06 request maintains the full-time equivalent staffing level of 240 while eliminating all existing grant programs, including: Public Works Grants, Economic Adjustment, Planning Grants, Trade Adjustment, Technical Assistance, and Research & Evaluation. The EDA staff and regions, it is presumed, would be responsible in part for administering the proposed Strengthening America's Communities Grant Program.

The Technology Administration (TA) works with U.S. industry to maximize technology's contribution to U.S. economic growth. Led by the Under Secretary for Technology, TA fulfills its broad responsibilities through its component organizations: the Office of Technology Policy (OTP), the National Institute of Standards and Technology (NIST), and the National Technical Information Service (NTIS) with its National Telecommunications and Information Administration (NTIA).

• Under Secretary for Technology/OTP ­ $4.2 million ($2.3 million decrease). OTP's mission is to develop national policies and initiatives to enable technology to best contribute to America's competitiveness. The office also administers the National Medal of Technology. Full-time equivalent staffing levels would be reduced by 10 in FY06.
• NIST Advanced Technology Program (ATP) ­ no funding is requested ($140.4 million decrease). The Administration's FY06 budget would terminate the program and eliminate 244 full-time equivalent positions. No new projects were funded in FY05, facilitating the termination process. According to the FY06 Budget in Brief (p. 120), NIST would be abandoning obligations toward its second performance goal to "accelerate private investment in and development of high-risk, broad-impact technologies." Progress toward the goal's target measurements or outcomes, such as a 10-12 percent increase in number of patents, publications and technologies under commercialization, would be based on the continued success of past ATP investments.
• NIST Hollings Manufacturing Extension Partnership (HMEP) ­ $46.8 million ($60.7 million decrease). The Budget in Brief provides no reasoning for the reduction. It indicates,"At this level, the Administration will maintain a national network of centers while focusing funding based on centers' performance and need" (p.131). In the performance goals and measures, the request acknowledges the 56.7 percent cut would result in 52 percent reduction in the number of clients served, increased sales attributed to the centers by clients, capital investment attributed to the centers and industrial client cost savings attributed to center-provided services (p.120). In FY06, 18 full-time equivalent positions would be eliminated, reducing HMEP federal staffing levels to 46.
• NIST Baldrige National Quality Program ­ $5.7 million ($200,000 increase). This program helps U.S. businesses and other organizations continuously improve their competitiveness and productivity through quality and performance management practices. Staffing levels are maintained at 39 full-time equivalent positions.
• NIST Laboratories and Research Facilities - $417.8 million ( $37.7 million increase). The NIST laboratories research program focuses on proving the measurements, standards, verified data, and test methods necessary to support the development of new technologies and to promote U.S. competitiveness. The Advanced in Manufacturing research area would receive the largest increase (up $16.6 million and 31 full-time equivalent positions) to enhance the research capabilities of the National Nanomanufacturing and Nanometrology Facility. An additional $11.55 million and 33 positions are requested for New Measurement Horizons for the U.S. Economy and Science to provide the measurement infrastructure. Measurements and Standards for Homeland Security would receive an additional $3 million.

TheMinority Business Development Agency (MBDA) would receive $30.7 million in FY06, an increase of $1.2 million above the FY05 appropriation. MBDA maintains the lead role within the federal government providing management and technical assistance to minority-owned businesses through the national network of Minority Business Development Centers and Native American Business Development Centers. New initiatives include: $500,000 to foster business development among Asian American and Pacific Islanders; and, $203,000 to expand the agency's capacity to disseminate statistical information and research. Staffing levels are maintained at 115 full-time equivalent positions.

The National Oceanic and Atmospheric Administration (NOAA) would receive $3.6 billion in FY06, or $332 million less than the FY05 appropriation. NOAA components supporting significant research activity fall under the Operations, Research and Facilities line item, which is slated for a $261.3 million cut. Most of the reductions are attributed to eliminating Congressionally directed funds (i.e. "earmarks"). Key NOAA components for the research community include:

• National Marine Fisheries Service ­ $625.5 million ($51.1 million increase) for research in the variables affecting the abundance and variety of marine fisheries.
• National Ocean Service ­ $394.2 million ($147 million decrease) to support coastal science and estuarine research reserves of national significance.
• Oceanic and Atmospheric Research  ­ $361.7 million ($42.4 million decrease) for the research and technology development necessary to improve outlooks, solar-terrestrial forecasts and marine services.
• National Weather Service - $744.8 million ($40.9 million increase) for weather and flood warning and forecasts.
• National Environmental Satellite, Data and Information Service - $154 million ($22.1 million decrease) for operation and updating polar-orbiting and geostationary operational field satellites.

The U.S. Patent and Trademark Office is anticipated to have a budget of $1.703 billion in FY06, funded entirely by fees, an increase of $149 million. The anticipated increase would permit the office to hire an additional 384 full-time equivalent staff for patent and trademark examination and processing.

The Bureau of Economic Analysis within the Economic and Statistical Analysis Administration would receive $81.3 million and 44 new full-time equivalent positions in FY06 through the Administration's request. This reflects a 10.8 percent increase over FY05. The increased funds would be directed toward strengthening international statistics and accelerating data releases of several key economic measures for improved timeliness, relevance and accuracy.

NTIA Technology Opportunities Program ­ no funding is requested. This program also was not funded in FY05.  Organizations looking for information on demonstration projects applying advanced telecommunications technology to enhance the delivery of social services, such as education, health care and public safety are encouraged to visit the program's website while it is still functioning.