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The National Institute of Standards and
Technology: An Appropriations Overview

Wendy H. Schacht
Specialist in Science and Technology Policy
March 24, 2009
Congressional Research Service
7-5700
www.crs.gov
95-30
CRS Report for Congress
P
repared for Members and Committees of Congress
c11173008

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The National Institute of Standards and Technology: An Appropriations Overview

Summary
The National Institute of Standards and Technology (NIST), a laboratory of the Department of
Commerce, is mandated to provide technical services to facilitate the competitiveness of U.S.
industry. NIST is directed to offer support to the private sector for the development of pre-
competitive generic technologies and the diffusion of government-developed innovation to users
in all segments of the American economy. Laboratory research is to provide measurement,
calibration, and quality assurance techniques that underpin U.S. commerce, technological
progress, improved product reliability, manufacturing processes, and public safety.
Continued funding for NIST extramural programs directed toward increased private sector
commercialization has been a major issue. Some Members of Congress have expressed
skepticism over a “technology policy” based on providing federal funds to industry for
development of pre-competitive generic technologies. This approach, coupled with pressures to
balance the federal budget, led to significant reductions in funding for NIST. The Advanced
Technology Program (ATP) and the Manufacturing Extension Partnership (MEP), which
accounted for over 50% of the FY1995 NIST budget, were proposed for elimination. In 2007,
ATP was terminated and replaced by the Technology Innovation Program (TIP).
While much of the legislative debate has focused on ATP and MEP, increases in spending for the
NIST laboratories that perform the research essential to the mission responsibilities of the agency
have tended to remain small. As part of the American Competitiveness Initiative, announced by
former President Bush in the 2006 State of the Union, the Administration stated its intention to
double over 10 years funding for “innovation-enabling research” done at NIST through its “core”
programs (defined as internal research in the STRS account and the construction budget). While
additional funding has been forthcoming, it remains to be seen how support for internal R&D at
NIST will evolve and how this might affect financing of extramural efforts such as TIP and MEP.
As the 111th Congress debates the budget and the economic stimulus, the resulting dispensation of
funding for NIST programs may influence the way by which the federal government supports
technology development for commercial application.


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The National Institute of Standards and Technology: An Appropriations Overview

Contents
Mission and Background............................................................................................................. 1
NIST Appropriations................................................................................................................... 3
Issues for Congress ..................................................................................................................... 4

Contacts
Author Contact Information ........................................................................................................ 5

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The National Institute of Standards and Technology: An Appropriations Overview

Mission and Background
The National Institute of Standards and Technology, formerly the National Bureau of Standards
(NBS), was established by the NBS Organic Act of 1901 (P.L. 56-177) as a laboratory of the
Department of Commerce. Unlike most federal laboratories, NIST has a mission specified by
statute (15 U.S.C. 271-282a), has a separate authorization and appropriation, and is headed by a
Senate-confirmed presidential appointee.
Prior to 1988, the mission of NBS was to develop and maintain standards and measurement
support for scientific investigations, engineering, manufacturing, commerce and educational
institutions, as well as to provide technical and advisory services to other government agencies on
scientific and engineering problems. The Omnibus Trade and Competitiveness Act of 1988 (P.L.
100-418) changed the name of NBS to the National Institute of Standards and Technology and
mandated the agency provide technical services to facilitate the competitiveness of U.S. industry.
NIST is directed to offer support to the private sector for the development of pre-competitive
generic technologies and the diffusion of government-developed innovation to users in all
segments of the American economy. Laboratory research is to provide measurement, calibration,
and quality assurance techniques that underpin U.S. commerce, technological progress, improved
product reliability, manufacturing processes, and public safety.
A dual approach is used to accomplish this mission. Research and development is performed
within the NIST laboratory facilities while two extramural initiatives, the Technology Innovation
Program (TIP)and the Manufacturing Extension Partnership (MEP), are administered by the
organization. The NIST in-house R&D effort, involving approximately 3,300 scientists,
engineers, technicians, and support personnel (plus some 1,200 visiting scientists per year from
industry, academia, and other government agencies), is conducted at laboratories in Maryland and
Colorado. A major emphasis is cooperative research with industry to overcome technical barriers
to commercialization of emerging technologies. NIST participates with U.S. companies in
collaborative R&D programs in 130 research areas.1
NIST is composed of seven internal research laboratories (Electronics and Electrical Engineering,
Manufacturing Engineering, Physics, Chemical Science and Technology, Materials Science and
Engineering, Building and Fire Research, and Information Technology), as well as a Center for
Nanoscale Science and Technology and a Center for Neutron Research. Research is focused on
measurement, evaluated data, standards, and test methods; basic “infrastructural technologies”
that enable development of advanced technologies, and which industry can use to characterize
new materials, monitor production processes, and ensure the quality of new product lines. As part
of the American Competitiveness Initiative announced in the 2006 State of the Union Address by
former President Bush, the Administration called for a doubling of funding for in-house research
performed by NIST.
In response to what was perceived as the necessity of maintaining a strong manufacturing base,
Title V of the Omnibus Trade and Competitiveness Act (P.L. 100-418) “significantly expands the
role of NIST as the Government’s lead laboratory in support of U.S. industrial quality and
competitiveness.” To this end, NIST was given specific technology transfer functions, and several

1 Available at the National Institute of Standards and Technology website: http://www.nist.gov/.
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The National Institute of Standards and Technology: An Appropriations Overview

programs were created including the now terminated Advanced Technology Program (ATP),
Regional Centers for the Transfer of Manufacturing Technology, and State Technology Extension.
These efforts were designed to facilitate industrial activities to utilize advanced process
technology; to promote cooperative ventures among industry, universities, and government
laboratories; and to encourage shared risks, accelerated development, and increased skills.
Prior to its elimination in 2007, the Advanced Technology Program provided seed funding,
matched by private sector investment (generally of at least 50% of costs), to companies or
consortia of universities, businesses, and government laboratories for development of generic
technologies that have broad application across industries.2 Awards, based on technical and
business merit, were made for high-risk work past the basic research stage but not yet ready for
commercialization. The first awards were made in 1991; 824 projects were funded.
The Technology Innovation Program3 was authorized to replace ATP in the America COMPETES
Act (P.L. 110-69) and funded in the FY2008 appropriations legislation. While similar to ATP in
the intent to promote high risk R&D that would be of broad economic benefit to the Nation, large
firms are not eligible to receive grants. In addition, while universities participating in a joint
venture could not be the direct recipient of a grant under the ATP activity, under TIP, universities
may qualify for grants if they are partnered with a small or medium-sized firm.
The Regional Centers for the Transfer of Manufacturing Technology were expanded in 1994 to
include the State Technology Extension Program and are now known as the Hollings
Manufacturing Extension Partnership (MEP).4 This activity is designed to transfer expertise and
technologies developed under NIST programs to small and mid-sized U.S.-based manufacturing
firms. Funded through cooperative agreements with non-profit or state and local organizations,
competitive awards were originally made for up to six years (now extended). Non-federal sources
are required to provide 50% or more of each Center’s capital and costs during this time period.
P.L. 105-309 permits the federal government to support centers after the six years if a positive,
independent evaluation is made every two years. Federal funding is limited to one-third of the
capital and annual operating and maintenance costs of the center. Manufacturers are offered
expertise, needs evaluation, application demonstrations for new production technologies, training,
and information dissemination. Centers are located in all 50 states and Puerto Rico with
approximately 400 regional offices. NIST also assumed support of the 36 centers originally
funded by the Department of Defense through its Technology Reinvestment Project when funding
for this program was terminated in FY1994.
In a related development, the America COMPETES Act authorized the creation, but did not fund,
several new manufacturing programs to be administered by NIST including collaborative
manufacturing research pilot grants for partnerships between industry and other educational or
research institutions to develop new manufacturing processes, techniques, or materials; a
manufacturing fellowship program with stipends available for post-doctoral work at NIST; and a
manufacturing research database. These activities differ from the established MEP effort in which
no new manufacturing research is conducted as existing manufacturing technology is applied to
the needs of small and medium-sized firms.

2 For more information on ATP see CRS Report 95-36, The Advanced Technology Program, by Wendy H. Schacht.
3 See CRS Report RS22815, The Technology Innovation Program, by Wendy H. Schacht
4 For more information on the MEP see CRS Report 97-104, Manufacturing Extension Partnership Program: An
Overview
, by Wendy H. Schacht.
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The National Institute of Standards and Technology: An Appropriations Overview

NIST Appropriations
Beginning in FY1991, the NIST budget experienced marked growth as Congress funded external
grant programs—the Advanced Technology Program and the Manufacturing Extension
Partnership—authorized by P.L. 100-418. However, the 104th Congress curtailed the expansion of
support for NIST and overall funding levels decreased 18% between FY1995 and FY1997. In
FY1998, the NIST budget again increased as P.L. 105-119 appropriated $677.9 million. Under
P.L. 105-277, NIST received $641.1 million in FY1999 funding, approximately 5% less than the
previous year. For FY2000, P.L. 106-113 provided NIST with $635.8 million after a mandated
rescission. P.L. 106-553 funded NIST at $598.3 million in FY2001. The following year, P.L. 107-
77 financed NIST at $674.5 million, an increase of 13% over the earlier figure.
The Bush Administration first offered a significant cut in support for MEP in the FY2003 budget.
The proposed 89% decline in MEP funding was due to the President’s recommendation that
centers in operation for more than six years do so without federal financing. However, P.L. 108-7
provided NIST with $707.5 million in FY2003 funds and maintained support for manufacturing
extension.
FY2004 appropriations of $610.7 million for NIST were included in P.L. 108-199. In-house R&D
under the Scientific and Technical Research and Services (STRS) account was funded at $337.2
million. Financing for the Manufacturing Extension Partnership program decreased significantly
to $38.7 million. ATP received $170.5 million and construction totaled $64.2 million. The
following year, P.L. 108-447 provided NIST with funding of $695.3 million with MEP support
increased to pre-FY2004 levels at $107.5 million. The STRS account received $378.8 million,
ATP was financed at $136.5 million, and the construction budget totaled $72.5 million.
NIST appropriations totaled $752 million in FY2006. Support for the STRS account increased to
$394.8 million. MEP was funded at $104.6 million, while financing for ATP declined to $79
million. Construction more than doubled to $173.6 million. No final FY2007 appropriations
legislation was enacted until the 110th Congress passed P.L. 110-5, providing $676.9 million for
NIST. The STRS account increased to $434.4 million, construction support decreased to $58.7
million, while ATP was financed at $79.1 million and MEP received $104.7 million.
The Administration’s FY2008 budget request included $640.7 million for NIST, 5.3% below
FY2007, due primarily to the absence of financing for ATP and reduced support for MEP. The
STRS account would have received $500.5 million (including the Baldrige National Quality
Program) while funding for MEP would be reduced to $46.3 million. The construction budget
would have totaled $93.9 million.
The FY2008 Consolidated Appropriations Act, provided NIST with $755.8 million, an increase of
11.7% over FY2007. Support for the STRS account increased 1.4% to $440.5 million (including
the Quality Program). The Technology Innovation Program, which replaced ATP, was
appropriated $65.2 million (with an additional $5 million from FY2007 ATP unobligated
balances), 17.6% below the previous fiscal year. Funding for MEP totaled $89.6 million, 14.4%
less than FY2007. Support for construction almost tripled to $160.5 million.
The Bush Administration’s original FY2009 budget request proposed $638 million in funding for
NIST. On June 6, 2008, the former President submitted a series of amendments to his budget
including a reduction of $2 million in the amount requested for NIST (from the MEP program).
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The National Institute of Standards and Technology: An Appropriations Overview

The new request of $636 million was 15.9% below the earlier fiscal year due to an absence of
support for TIP and a significant decrease in financing MEP. Funding for the STRS account
(including the Quality Program) was to increase 21.5% to $535 million, while MEP would be
provided $2 million to close out the federally financed portion of the program. Construction
support would decline 38.3% to $99 million.
During the 110th Congress, H.R. 7322, as reported from House Committee on Appropriations,
would have funded NIST at $816.9 million, 8.1% above FY2008. The STRS account would have
increased 13.7% to $500.7 million while support for TIP at $65.2 million would remain constant
and MEP funding would increase 36.2% to $122.0 million. Construction spending was to
decrease 19.6% to $129.0 million. S. 3182, as reported by the Senate Committee on
Appropriations, would have provided $813.5 million for NIST, an increase of 7.6% over FY2008.
Included was $489.5 million for the STRS account (an 11.1% increase), $65.0 million for TIP,
and $110.0 million for MEP (a 22.8% increase). The construction budget would have declined
7.2% to $149.0 million.
No final FY2009 appropriations legislation was enacted by the close of the 110th Congress. P.L.
110-329, the Consolidated Security, Disaster Assistance, and Continuing Appropriations Act,
2009, provides, in part, funding for NIST at FY2008 levels through March 6, 2009.
In the 111th Congress, P.L. 111-8, the FY2009 Omnibus Appropriations Act, funds NIST at $819.0
million. The STRS account receives a 7.2% increase to $472.0 million while support for MEP
totals $110.0 million (a 22.8% increase) and financing for TIP remains constant at $65.0 million.
The $172.0 million for construction reflects a 7.2% increase in funding.
Also in the current Congress, H.R. 1, as originally passed by the House, provided an additional
$100.0 million for the STRS account (to the appropriated funds in the Continuing Resolution), as
well as $70.0 million more for TIP and $30.0 million more for MEP. The construction budget
would have received an extra $300.0 million for a “competitive construction grant program for
research science buildings.” The initial Senate passed version of H.R. 1 included an additional
$168.0 million for the STRS account with the construction budget to expand with an additional
$307.0 million. The final version of the American Recovery and Reinvestment Act of 2009, P.L.
110-5, provides an extra $220.0 million for the STRS account to be used for “research,
competitive grants, additional research fellowships and advanced research and measurement
equipment and supplies,” as noted in the Joint Explanatory Statement of the Committee on
Conference. An additional $360.0 million is included for construction, of which $180.0 million
“shall be for the competitive construction grant program for research science buildings.” The law
also directs the transfer of $20.0 million from the Health Information Technology initiative to
NIST to “create and test standards related to health security and interoperability in conjunction
with partners at the Department of Health and Human Services,” according to the Joint Statement.
Issues for Congress
Continued funding for the extramural programs at NIST has been a major issue. Beginning with
the 104th Congress, many Members expressed skepticism over a “technology policy” based on
providing federal funds to industry for development of pre-competitive generic technologies. This
philosophical shift from previous Congresses, coupled with pressures to balance the federal
budget, led to significant reductions in funding for NIST. The Advanced Technology Program and
the Manufacturing Extension Partnership, which accounted for over 50% of the FY1995 NIST
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The National Institute of Standards and Technology: An Appropriations Overview

budget, were proposed for elimination. While, in the past, strong support by the Senate led to
their continued financing, funding for ATP remained controversial. Since FY2000, the original
appropriations bills as passed by the House did not contain funding for ATP and many of the
budget proposals submitted by former President Bush called for abolishing the program. In the
110th Congress, legislation replaced ATP with the TIP initiative and provided financing for the
new program. In the FY2003 budget proposal, the Bush Administration also recommended
suspension of federal support for those manufacturing extension centers in operation for more
than six years. The following year, P.L. 108-199 significantly cut funding for the MEP program.
However, the FY2005 Omnibus Appropriations Act brought support for MEP back up to the level
necessary to fully fund the existing centers. The President’s FY2009 budget request once again
included an effort to close out the federally funded portion of the program but the final FY2009
appropriations legislation increased financing for MEP.
While much of the legislative debate has focused on ATP and MEP, increases in spending for the
NIST laboratories that perform the research essential to the mission responsibilities of the agency
have tended to remain small: a 3.7% increase between FY1995 and FY1996, a 3.5% increase in
FY1997, no increase for FY1998, and 3.1% for FY1999. During FY2000, there was less than a
1% increase in support. However, FY2001 appropriations were 11% above the previous year
while the figure for FY2002 included a 2.7% increase in funding. Support for in-house R&D in
FY2003 was 12% more than the previous fiscal year; although the FY2004 figure decreased by
5.5%, funding for FY2005 included a 12% increase. In FY2006, financing of these in-house
activities once again increased. As part of the American Competitiveness Initiative, announced by
former President Bush in the 2006 State of the Union, the Administration stated its intention to
double over 10 years funding for “innovation-enabling research” done at NIST through its “core”
programs (defined as internal research in the STRS account and the construction budget). To this
end, the President’s FY2007 budget requested an increase of 18.3% for intramural R&D at NIST;
the final FY2007 appropriations legislation included a 10% increase for the STRS account. For
FY2008, the increase in support for internal research and development was 1.4%, below the
15.2% and 15.6% increases in the initial House and Senate FY2008 appropriations bills and the
President’s FY2008 budget proposal. The Administration’s FY2009 budget contained a 21.5%
increase in funding for the STRS account; both the House and Senate appropriation bills
introduced during the 110th Congress also included increases but at amounts less that the budget
request. In the current Congress, P.L. 110-5 provides significant additional funding for these
activities. Thus, it remains to be seen how support for internal R&D at NIST will evolve and how
this might affect financing of extramural efforts such as TIP and MEP. As the 111th Congress
continues to debate budget issues, the resulting dispensation of funding for NIST programs may
influence the way by which the federal government supports technology development for
commercial application.

Author Contact Information

Wendy H. Schacht

Specialist in Science and Technology Policy
wschacht@crs.loc.gov, 7-7066




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