The National Network for Manufacturing Innovation

February 9, 2016 (R44371)
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Contents

Appendixes

Summary

Congress maintains a strong interest in the health of U.S. manufacturing due to its central role in the U.S. economy and national defense. In 2012, in his FY2013 budget, President Obama proposed the creation of a National Network for Manufacturing Innovation (NNMI) to help accelerate innovation by investing in industrially relevant manufacturing technologies with broad applications, and to support manufacturing technology commercialization by bridging the gap between the laboratory and the market. The proposal included a request for $1 billion in mandatory funding for the National Institute of Standards and Technology (NIST) for the establishment of up to 15 NNMI Institutes for Manufacturing Innovation (IMIs). No legislation to enact the President's proposal was introduced in the 112th Congress.

In 2013, the President renewed his call for an NNMI in his FY2014 budget request, again seeking $1 billion in mandatory funding. In August 2013, bills entitled the Revitalize American Manufacturing and Innovation Act were introduced in the House (H.R. 2996) and the Senate (S. 1468) to establish a Network for Manufacturing Innovation. H.R. 2996 passed the House in September 2014. S. 1468 was reported by the Senate Committee on Commerce, Science, and Transportation in August 2014. No further legislative action was taken.

In 2014, the President's FY2015 budget again sought authority and funding to establish the NNMI, including $2.4 billion in discretionary funding to establish up to 45 IMIs. In December 2014, Congress passed, and the President signed into law, the Revitalize American Manufacturing and Innovation Act of 2014 (RAMI Act), as Title VII of Division B of the Consolidated and Further Continuing Appropriations Act, 2015 (P.L. 113-235). The RAMI Act directs the Secretary of Commerce to establish a Network for Manufacturing Innovation program at NIST. The RAMI Act includes provisions authorizing NIST, the Department of Energy, and other agencies to support the establishment of IMIs and establishing and providing for the operation of a Network for Manufacturing Innovation. NIST is authorized to use up to $5.0 million per year of appropriated funds for FY2015-FY2024 to carry out its responsibilities under the act. The Department of Energy is authorized, but not required, to transfer to NIST up to $250.0 million of appropriated funds over the same FY2015-FY2024 period. The Secretary of Commerce is also authorized to accept funds, services, equipment, personnel, and facilities to carry out the program. The act also establishes a National Office of the Network for Manufacturing Innovation Program at NIST to oversee and carry out the program.

Prior to enactment of the RAMI Act, President Obama used existing authorities and regular appropriations of the Department of Defense and Department of Energy to establish several NNMI-like institutes. Under the RAMI Act, these and other institutes may be designated as part of the Network for Manufacturing Innovation.

Enactment of the Consolidated Appropriations Act, 2016 (P.L. 114-113) provides new impetus for congressional oversight as appropriations were made explicitly for the first time for the NNMI. P.L. 114-113 provides NIST with $25 million for the purpose of establishing IMIs and coordinating their activities. Among the issues of interest are the selection of focus areas for the new centers and the integration of these centers with existing ones. Another area of possible congressional attention is to the network of IMIs. While the RAMI Act specifies which new and existing institutes are eligible to be a part of the network and designates the National Program Office as "a convener of the Network," it does not further specify the purpose, federal role, and activities of the network.


The National Network for Manufacturing Innovation

Introduction

Congress maintains a strong interest in the health of U.S. manufacturing due to its central role in the economy and national defense. Manufacturing accounts for about 12% of the nation's gross domestic product (GDP). Manufacturing enterprises directly employ approximately 12 million U.S. workers and indirectly support millions of additional jobs in other industries. Manufacturers also fund about two-thirds of the nation's industrial research and development (R&D), providing a foundation for technological innovation and continued U.S. technological leadership. Total average compensation (wages and benefits) for manufacturing workers ($81,347) exceeds total average compensation for all workers ($71,161).1 With respect to national defense, the United States depends heavily on its manufacturing base to produce military weapons, aircraft, ground vehicles, ships, and other equipment.

Analysts hold divergent views of the health of U.S. manufacturing. Some see the sector as vibrant and healthy. Those holding this view tend to point to, among other things, the sector's strong growth in output and productivity, as well as the United States' world-leading share of global manufacturing output.2 From its low point in March 2010, U.S. manufacturing employment has grown by 878,000 (7.7%) to 12.3 million in December 2015.3

Other analysts, however, believe that the U.S. manufacturing sector is at risk. Those holding this view express concerns about a "hollowing-out" of U.S. manufacturing resulting from the decision of many U.S. manufacturers to move production activities offshore; policy and program efforts of other nations to attract and grow manufacturing companies; and a decades-long trend in declining U.S. manufacturing employment.

The 2007-2009 recession and the relatively slow subsequent pace of recovery have contributed to increased concerns about the health of U.S. manufacturing. Some stakeholders and policymakers advocate for changes to improve the business environment, including reducing tax and regulatory burdens on manufacturers and reforming the nation's tort laws.

Other stakeholders and policymakers support more direct and focused efforts funded by the federal government, such as those that aim to help a particular technology or industry. In particular, President Obama has undertaken and proposed the creation and funding of a variety of initiatives (e.g., the Advanced Manufacturing Partnership, the National Robotics Initiative, and the Materials Genome Initiative) to help address concerns about U.S. manufacturing. One of the President's key proposals to help U.S. manufacturers is the establishment of a National Network for Manufacturing Innovation (NNMI).

The NNMI is the main focus of this report. The report begins with a discussion of the NNMI proposal and subsequent legislative action. It reviews related institutes established during the legislative debate. It then addresses several broad policy and implementation issues that continue to face Congress, including the availability of funding, the proper role of the federal government, and oversight of NNMI implementation.

NNMI Proposal and Legislative Action

In February 2012, in his FY2013 budget, President Obama proposed the establishment of the NNMI, requesting $1 billion in mandatory funding to support the establishment of up to 15 institutes.4 He formally introduced the concept in a speech at a manufacturing facility in Virginia on March 9, 2012.

During 2012, the Advanced Manufacturing National Program Office (AMNPO)5 sought nationwide input from industry, academia, state and local governments, economic development authorities, industry associations and consortia, private citizens, and other interested parties to help guide the design of the NNMI. The AMNPO held four regional workshops and published a Request for Information (RFI) in the Federal Register inviting public comment on the proposed NNMI program. The AMNPO used the input gathered from the workshops and the RFI in the preparation of a January 2013 National Science and Technology Council report, National Network for Manufacturing Innovation: A Preliminary Design.6

No legislation to enact the President's proposal was introduced in the 112th Congress. In 2013, the President renewed his call for an NNMI in his FY2014 budget request, again seeking $1 billion in mandatory funding. In August 2013, bills titled the Revitalize American Manufacturing and Innovation Act were introduced in the House (H.R. 2996) and the Senate (S. 1468) to establish a Network for Manufacturing Innovation. H.R. 2996 passed the House in September 2014. S. 1468 was reported by the Senate Committee on Commerce, Science, and Transportation in August 2014. No further legislative action was taken.

The President's FY2015 budget proposal once again sought authority and funding to establish the NNMI. The request was not part of the President's FY2015 base budget request, but rather a part of his adjunct $56 billion Opportunity, Growth, and Security Initiative (OGSI) proposal. The OGSI included $2.4 billion in discretionary funding to establish up to 45 NNMI institutes. No legislative action was taken on this OGSI proposal.

In December 2014, nearly three years after President Obama first proposed the establishment of the NNMI, Congress passed the Revitalize American Manufacturing and Innovation Act of 2014 (RAMI Act), as Title VII of Division B of the Consolidated and Further Continuing Appropriations Act, 2015 (P.L. 113-235). President Obama signed the bill into law on December 16, 2014. The RAMI Act directs the Secretary of Commerce to establish a Network for Manufacturing Innovation (NMI)7 program within the Commerce Department's National Institute of Standards and Technology (NIST). The provisions of the RAMI Act are discussed throughout this report and detailed in Appendix A, "NNMI Provisions of the RAMI Act."

Pre-RAMI Act IMIs

Prior to passage of the RAMI Act, the Obama Administration relied on regular appropriations and the existing statutory authorities of the Department of Defense (DOD) and Department of Energy (DOE) to establish seven NNMI-like institutes. Five of these institutes were competed and awarded by DOD:8

Two of the institutes were competed and awarded by DOE:

Two more institutes are being competed as of the date of this report. The Department of Defense is running a competition for a Revolutionary Fibers and Textiles Manufacturing Innovation Institute,9 and the Department of Energy is running a competition for a Clean Energy Manufacturing Innovation Institute on Smart Manufacturing: Advanced Sensors, Controls, Platforms and Modeling for Manufacturing.10

The RAMI Act allows certain existing manufacturing institutes to be classified as an IMI for participation in the network. In particular, the act incorporates

the National Additive Manufacturing Innovation Institute and other manufacturing centers formally recognized as [IMIs] pursuant to Federal law or executive actions, or under pending interagency review for such recognition as of the date of enactment of the Revitalize American Manufacturing and Innovation Act of 2014.11

However, the RAMI Act prohibits such institutes from receiving any financial assistance authorized by the act.

In December 2015, Congress appropriated specific funding, for the first time, for the establishment and coordination of IMIs under the provisions of the RAMI Act. The Consolidated Appropriations Act, 2016 (P.L. 114-113) provides NIST with $25.0 million for FY2016 for the NNMI, to include funding for establishment of IMIs and up to $5.0 million for coordination activities.12 The explanatory statement accompanying the act directs NIST to

follow the direction of the Revitalize American Manufacturing and Innovation Act of 2014 in requiring open competition to select the technological focus areas of industry-driven manufacturing institutes.13

NIST subsequently announced its intention to establish two institutes.14 While the announcement states that the NIST-led competitions "will allow for consideration of all applications relevant to advanced manufacturing regardless of technology area," it nevertheless specifies a particular interest in receiving applications in two areas: collaborative manufacturing robots and biopharmaceuticals manufacturing. According to the announcement, NIST intends to provide up to a total of $70 million per institute over five to seven years, with federal funding matched by private and other non-federal sources.

It is possible that agencies may continue to establish IMIs outside the parameters of the RAMI Act, and that these may subsequently be incorporated into the NNMI network.

Options for Congressional Action

While the RAMI Act established the NNMI program, set forth its purposes, and authorized its structure, funding, and operation, a number of options remain for Congress to consider as the program is implemented.

Availability and Prioritization of Appropriations

The RAMI Act provides for the Secretary of Commerce to use up to $5 million in funds appropriated to the NIST Industrial Technology Services (ITS) account to carry out the NNMI program. The availability of funds for the NNMI, however, will depend on the level of annual appropriations. In addition, appropriations made to the ITS account may be subject to congressional prioritization and restrictions included in report language accompanying the appropriations bill. In FY2015, Congress appropriated $138.1 million for the ITS account, directing NIST to spend $130.0 million on the Hollings Manufacturing Extension Partnership and $8.1 million on NIST's Advanced Manufacturing Technology Consortia program. It did not provide explicit funding for the NNMI in FY2015. As discussed above, the FY2016 NIST appropriation exceeds the RAMI Act authorization, providing $25 million for the NNMI for establishing new IMIs and for coordination activities.

A second source of NNMI funding provided for by the RAMI Act is authority given to the Department of Energy to transfer to NIST up to $250 million for the period FY2015-FY2024. However, the availability of funds provided by the DOE to NIST depends, in part, on the level of annual appropriations made to the DOE's Energy Efficiency and Renewable Energy account specifically for advanced manufacturing R&D. This source of funding for the NNMI may also be subject to prioritization and potential restrictions included in report language accompanying the appropriations bill. In addition, the availability of these funds to NIST will depend on DOE's willingness to transfer funds to NIST for the NNMI program. In FY2015, DOE did not transfer any funding to NIST for this purpose.

A third possibility for funding the program is the authority given to the Secretary of Commerce to accept funds, services, equipment, personnel, and facilities from other sources to carry out the program.

The RAMI Act does not specify how the funds provided by NIST, DOE, or other agencies are to be allocated between program management activities and funding for the IMIs. In the absence of such specifications, it appears that funds may be used for either or both of these purposes.

If Congress desires to provide funding for the NNMI for FY2017 and beyond, it may opt to appropriate funds to NIST directly, or to DOE or another federal agency with direction to transfer the funds to NIST for this purpose.

The Role of the Federal Government in the Network

In addition to authorizing the establishment of IMIs, the RAMI Act authorizes the establishment of a network of these IMIs. In this regard, the act specifies which institutes are eligible to be a part of the network and designates the National Program Office as "a convener of the Network."15 However, the act does not further specify the purpose, federal role, or activities of the network of IMIs. Congress may consider amending the act to clarify these points or to authorize NIST and participating agencies to do so.

The Role of the Federal Government After FY2024

The RAMI Act authorizes the NNMI through FY2024 and requires the Comptroller General of the United States to make a final assessment by December 31, 2024. No specifications are made in the act for a federal role after the end of FY2024. As the program progresses, Congress may consider whether to continue the NNMI beyond FY2024 or to allow it to expire.

Congressional Oversight

Congress may conduct oversight hearings on the implementation of the NNMI program to ensure that it is operating as Congress intends, with respect to funding, interagency cooperation, the establishment of new IMIs, the incorporation of existing institutes as part of the network, the integration of the NNMI with existing federal manufacturing activities (such as the NIST Manufacturing Extension Partnership program), and other related issues.

Issue: Is There a National Need for the NNMI Program?

While the RAMI Act included a number of findings that highlight the role manufacturing plays in the U.S. economy, it did not identify specific shortcomings of the U.S. manufacturing sector that the NNMI program is to address. Just as analysts hold divergent views of the health of U.S. manufacturing, some may be supportive of the NNMI effort while others may question whether there is a compelling national need for it.

Some analysts believe that the U.S. manufacturing sector is at risk. Expressed concerns of those holding this view include the following:

On the other hand, some analysts argue that long-term employment losses in manufacturing are inevitable and that federal policy should focus elsewhere. In a July 2014 Wall Street Journal article, former Treasury Secretary Lawrence Summers argued that "the economic challenge of the future will not be producing enough. It will be providing enough good jobs." Summers described the loss of manufacturing jobs over the long term as "inexorable and nearly universal," a result of technology and market forces mirroring the earlier loss of agricultural jobs, only this "change will come faster and affect a much larger share of the economy." Summers did not offer a prescriptive alternative, but rather stated the need for government policies and approaches that "meet the needs of the information age."18

In support of the President's proposal for a National Network for Manufacturing Innovation, the Information Technology and Innovation Foundation, a Washington, DC-based think tank, articulated a variety of reasons why there is a need for an NNMI-like federal program in a report titled Why America Needs a National Network for Manufacturing Innovation. Among the ITIF's assertions:

Supporters of the program may note that foreign governments engage in a variety of policy and programmatic activities designed to attract U.S. and other manufacturing firms to their countries; subsidize and protect domestic producers; or "repress labor, condone intellectual property theft, and manipulate their currency values in order to expand their manufacturing footprint." Meanwhile, the federal government provides little support for manufacturing-focused U.S. based research activities: Such funding is scattered among multiple agencies and "has rarely been a priority for any of them." This position contends that U.S. academia, in general, does not incentivize engineering advances and practical problem-solving. Instead, the emphasis on "engineering as a science" in U.S. academic engineering programs focuses on "originality and breakthroughs."19

Others may view the U.S. manufacturing sector as vibrant and healthy without a need for the NNMI. Those holding this view tend to point to, among other things, the sector's strong growth in output and productivity, as well as the United States' substantial share (17.4%) of global manufacturing value-added (second only to China, 22.4%).20 As noted in the introduction, between March 2010 and December 2015, manufacturing employment added approximately 878,000 jobs, growing to 12.3 million.21 Many analysts attribute the previous long-term trend in U.S. manufacturing employment losses to broader global technology and business trends, such as technology-driven productivity improvements, increases in capital-labor substitution, movement of labor-intensive production activities to lower-wage regions of the world, foreign competition in manufactured goods in both U.S. and foreign markets, and disaggregation of work processes resulting in the contracting of service work previously performed by employees of manufacturing firms as well as the offshoring of manufacturing activities. From this perspective, the NNMI may be either unnecessary or swimming against the tide of history.

Issue: What Is the Appropriate Role of the Federal Government in Manufacturing?

Independent of their perspective on the health of the U.S. manufacturing sector, some analysts and policymakers may believe that there should not be an NNMI program because it is not an appropriate role for the federal government. The appropriate role of the federal government in fostering technological innovation or supporting a particular company, industry, or industrial sector (e.g., manufacturing) has been the focus of a long-running national policy debate. Views range from those who believe that the federal government should take a hands-off or minimalist approach to those who support targeted federal investments in promising technologies, companies, and industries. While there has been broad agreement on federal support for fundamental research, the consensus in favor of federal support frays as technology matures toward commercialization.

Advocates for a strong federal role in advancing technologies and industries often assert that such interventions are justified by the economic, national security, and societal benefits that generally accompany technological advancement and U.S. technological and industrial leadership. For such reasons, the manufacturing sector has received the attention of the federal government since the nation's founding.22

Critics of a strong federal role provide a variety of arguments. For example, some contend that the federal government should not favor or subsidize particular companies, industries, or technologies, asserting that such interventions skew technology development and competition by replacing decisions of companies, capital providers, and researchers with the judgment of government bureaucrats or politicians (sometimes referred to as the government "picking winners and losers"). Those who hold this view generally assert that this may result in inefficient allocation of capital, development and deployment of inferior technologies, and political favoritism (sometimes referred to as "crony capitalism"). Others assert that such interventions often represent a transfer of wealth from taxpayers to already-prosperous companies and their shareholders (sometimes referred to as "corporate welfare").

Some critics may assert that the role envisioned for the NNMI should be performed by the private sector; that the NNMI would be ineffective or counterproductive; that the funds that would go to the NNMI should be used to support manufacturing in other ways; that the funds should be used for different federal functions altogether; or that the funds should be directed toward deficit reduction.

Others may prefer an approach that is more technology- or industry-neutral, such as reducing costs and other burdens on manufacturers by reducing taxes, regulations, and frivolous lawsuits.

Even some advocates of a strong federal role in supporting U.S. manufacturing may prefer alternative approaches, including increasing federal funding for manufacturing R&D, providing grants and loan guarantees for domestic manufacturing, or subsidizing production of products for which there are positive benefits for the nation that cannot be captured by the manufacturer.

Both supporters and opponents may believe that the NNMI is, in part or in whole, duplicative of other federal programs, such as the Manufacturing Extension Partnership; or, as a new and separate program, represents an increasing fragmentation of federal efforts to help manufacturers. Some may question whether additional federal funding will produce more innovation and whether and how the U.S. manufacturing base will effectively absorb such innovations.

When considered in the context of the overall U.S. economy, manufacturing output, or federal spending, the scale of the NNMI may seem relatively small. Nevertheless, both proponents and opponents of the NNMI may see the current program as opening the door to future increases in funding for the NNMI as well as establishing a precedent for the creation of additional programs of a similar nature for manufacturing or other sectors of the U.S. economy.

NNMI Provisions of the RAMI Act

The RAMI Act amends the National Institute of Standards and Technology Act (codified at 15 U.S.C. 271 et seq.) to establish the NNMI program,23 setting forth its purposes and authorizing its structure, funding, and operation. The act also establishes a National Program Office to support the NNMI program.

Purposes

The RAMI Act specifies eight purposes of the NNMI program:

Structure

The act directs the Secretary of Commerce to establish a Network for Manufacturing Innovation program at NIST.24 The Secretary, acting through NIST, is directed to support the establishment of IMIs and to establish and support a network of IMIs.

Institutes for Manufacturing Innovation

The act defines an IMI25—including institutes established prior to the act, as well as ones established under the provisions of the act—as one that meets each of the following criteria:

IMI Activities

The act authorizes activities of an IMI to include the following:

Identification of Existing Institutes for Inclusion in the Network

The act allows a number of existing manufacturing institutes to be classified as an IMI for participation in the network. As noted above, President Obama initiated the establishment of several such institutes prior to enactment of the RAMI Act under the existing general statutory authority of the Department of Defense and Department of Energy. In particular, the act incorporates

the National Additive Manufacturing Innovation Institute and other manufacturing centers formally recognized as [IMIs] pursuant to Federal law or executive actions, or under pending interagency review for such recognition as of the date of enactment of the Revitalize American Manufacturing and Innovation Act of 2014.26

However, the RAMI Act prohibits such institutes from receiving any financial assistance authorized by the act.

Financial Assistance to Establish and Support IMIs

The RAMI Act authorizes the Secretary of Commerce to award financial assistance to a person or group of persons to assist in planning, establishing, or supporting an IMI. The act requires an open process for the solicitation of applications that allows for the consideration of all applications relevant to advanced manufacturing, regardless of technology area, and competitive merit-based review of the applications that incorporates peer review by a "diverse group of individuals with relevant experience from both the public and private sectors."27 Political appointees are prohibited from participating on any peer review panel, and the Secretary of Commerce is required to implement a conflict of interest policy that ensures public transparency and accountability, as well as full disclosure of any real or potential conflicts of interest of individuals participating in the IMI selection process.

The Secretary of Commerce is required to make a description of the bases for any award of financial assistance to an IMI publicly available at the time of the award, including the merits of the winning proposal relative to other applicants. The Secretary must also develop and implement performance measures to assess the effectiveness of the funded activities.

In making IMI selections, the act requires the Secretary, working through the National Program Office, to collaborate with federal departments and agencies whose missions contribute to or are affected by advanced manufacturing.

IMI Selection Considerations

The RAMI Act requires the Secretary to apply certain considerations in the selection of IMIs. The considerations specified in the act include the following:

The act allows for other factors to be considered.

IMI Funding

The RAMI Act includes several provisions related to IMI funding:

Authorization of Appropriations

The RAMI Act authorizes NIST to use $5 million per year for FY2015-FY2024 from funds appropriated to its Industrial Technology Services account to carry out the Network for Manufacturing Innovation program. The act also authorizes the Department of Energy to transfer to NIST up to $250 million over the FY2015-FY2024 period from funds appropriated for advanced manufacturing R&D in its Energy Efficiency and Renewable Energy account.

The Secretary of Commerce, in addition to amounts appropriated to carry out the program, may accept funds, services, equipment, personnel, and facilities from any covered entity to carry out the program, subject to certain conditions and constraints.28

National Program Office

The RAMI Act directs the Secretary of Commerce to establish, within NIST, a National Program Office of the Network for Manufacturing Innovation to oversee and carry out the program.

The act specifies the following functions of the National Program Office:

In support of the development and updating of the strategic plan, the Secretary of Commerce is directed by the act to solicit recommendations and advice from a wide range of stakeholders, including industry, small and medium-sized manufacturing enterprises, research universities, community colleges, and other relevant organizations and institutions on an ongoing basis. The Secretary is directed to transmit the strategic plan to the Senate Committee on Commerce, Science, and Transportation and the House Committee on Science, Space, and Technology.

The act authorizes any federal government employee to be detailed to the National Program Office without reimbursement and without interruption or loss of civil service status or privilege to the employee.

Mandated Reports and Audits

The RAMI Act requires several reports and audits to be conducted with respect to the program.

Annual Reports by IMIs to the Secretary of Commerce

The RAMI Act directs the Secretary of Commerce to require each recipient of federal assistance under the act to submit an annual report to the Secretary that describes the finances and performance of the IMI for which assistance was awarded. Each report is required to include an accounting of expenditures of amounts awarded under the program to the IMI; a description of the performance of the IMI with respect to its goals, plans, financial support, and accomplishments; and an explanation of how the IMI has advanced the purposes of the program as specified by the act.

Annual Reports by the Secretary of Commerce to Congress

The RAMI Act requires the Secretary of Commerce to report annually to Congress through December 31, 2024, on the performance of the program during the most recent one-year period. Each report is to include a summary and assessment of the annual reports provided by each IMI; an accounting of funds expended by the Secretary under the program, including any temporary exemptions granted; an assessment of the participation in, and contributions to, the network by any IMIs for manufacturing innovation not receiving financial assistance under the program; and an assessment of the program with respect to meeting the purposes described in the act.

Biennial Assessment by the U.S. Government Accountability Office

The RAMI Act requires the Comptroller General of the United States (the head of the Government Accountability Office) to conduct an assessment of the program at least once every two years during the operation of the program, covering the two most recent years of the program on the overall success of the program, and a final assessment to be made not later than December 31, 2024.

Each assessment is to include, for the period covered by the report, a review of the management, coordination, and industry utility of the program; an assessment of the extent to which the program has furthered the purposes identified in the act; such recommendations for legislative and administrative action as the Comptroller General considers appropriate to improve the program; and an assessment as to whether any prior recommendations for improvement made by the Comptroller General have been implemented or adopted.

Additional Program-Related Authorities

Other provisions of the RAMI Act authorize

The RAMI Act also specifies that the provisions of 35 U.S.C. 18, Patent Rights in Inventions Made with Federal Assistance, shall apply to any funding agreement30 awarded to new or existing institutes. This chapter of the U.S. Code is widely known as the Bayh-Dole Act and formally titled the University and Small Business Patent Procedures Act of 1980.31

Author Contact Information

[author name scrubbed], Specialist in Science and Technology Policy ([email address scrubbed], [phone number scrubbed])

Footnotes

1.

CRS analysis of data from Table 6.2D (Compensation of Employees by Industry) and Table 6.5D (Full-Time Equivalent Employees by Industry), National Income and Product Accounts, Bureau of Economic Analysis, U.S. Department of Commerce, http://www.bea.gov/iTable/iTable.cfm?ReqID=9&step=1#reqid=9&step=1&isuri=1. In addition, manufacturing workers earn higher average annual wages ($48,610 in 2014) than the overall annual wages for U.S. workers ($47,230) (Occupational Employment Statistics, May 2012, Bureau of Labor Statistics, U.S. Department of Labor, http://www.bls.gov/oes/current/naics2_31-33.htm#00-0000).

2.

For more information, see CRS Report R41898, Job Creation in the Manufacturing Revival, by [author name scrubbed].

3.

After peaking in 1979, U.S. manufacturing employment fell to 11.5 million, a 69-year low, in March 2010. December 2015 is the most recent month for which data is available. (Source: Bureau of Labor Statistics, U.S. Department of Labor, Current Employment Statistics survey database, data for manufacturing employment, all employees, seasonally-adjusted, http://data.bls.gov/cgi-bin/dsrv?ce.)

4.

The terms Centers for Manufacturing Innovation, Manufacturing Innovation Institutes, Institutes for Manufacturing Innovation, and Clean Energy Manufacturing Innovation Institutes have been used in different contexts to refer to institutes participating in the NNMI. For consistency, this report uses the term Institute for Manufacturing Innovation (IMI) to refer to any such institute.

5.

The AMNPO is a multi-agency activity focused on the coordination of federal manufacturing resources and programs to foster U.S. innovation and industrial competitiveness. It is hosted by the National Institute of Standards and Technology. Participating agencies include the Department of Commerce, Department of Defense, Department of Education, Department of Energy, Department of Homeland Security, Department of Labor, National Aeronautics and Space Administration, National Science Foundation, and Small Business Administration.

6.

Executive Office of the President, National Science and Technology Council, National Network for Manufacturing Innovation: A Preliminary Design, January 2013, http://www.manufacturing.gov/docs/nnmi_prelim_design.pdf.

7.

For clarity, the program is generally referred to in this report as the National Network for Manufacturing Innovation or NNMI, though the RAMI Act uses the term Network for Manufacturing Innovation (NMI).

8.

The name of each institute as specified for the competition by the sponsoring agency is listed first in each bulleted item, followed parenthetically by the name assigned the institute by the grantee, followed by the IMI's location.

9.

FedBizOpps.gov, https://www.fbo.gov/index?s=opportunity&mode=form&tab=core&id=1b9b0dab29ffeffccae5abf7bebeb4c0.

10.

Department of Energy, Office of Energy Efficiency and Renewable Energy, https://eere-exchange.energy.gov/Default.aspx#FoaIda7d7bd9b-c3b2-45c5-8111-55384aaf6393.

11.

P.L. 113-235.

12.

The act also directs NIST to merge its Advanced Manufacturing Technology Consortia (AMTech) program into the NNMI.

13.

Explanatory Statement, Consolidated Appropriations Act, 2016, Division B (Commerce, Justice, Science and Related Agencies Appropriations Act), Congressional Record, Vol. 161, No. 184-Book II (December 17, 2015), p. H9733. IMI selection criteria specified in the RAMI Act are provided in the Appendix. (See "IMI Selection Considerations.")

14.

National Institute of Standards and Technology, Department of Commerce, Notice of Intent: National Network for Manufacturing Innovation (NNMI) Institute Awards, December 21, 2015, http://www.nist.gov/amo/nnmi/upload/NIST-NNMI-NOI-2015-12-21.pdf.

15.

Section 703(f)(2)(F).

16.

For more information, see CRS Report R41712, "Hollowing Out" in U.S. Manufacturing: Analysis and Issues for Congress, by [author name scrubbed].

17.

See, for example, CRS Report R41898, Job Creation in the Manufacturing Revival, by [author name scrubbed].

18.

Lawrence Summers, "Lawrence H. Summers on the Economic Challenge of the Future: Jobs," Wall Street Journal, July 7, 2014.

19.

Quotations from David M. Hart, Stephen J. Ezell, and Robert D. Atkinson, Why America Needs a National Network for Manufacturing Innovation, Information Technology and Innovation Foundation, December 2012, http://www.itif.org/publications/why-america-needs-national-network-manufacturing-innovation.

20.

MAPI, https://www.mapi.net/china-has-dominant-share-world-manufacturing.

21.

Bureau of Labor Statistics, U.S. Department of Labor, Current Employment Statistics survey database, data for manufacturing employment, all employees, seasonally adjusted, http://data.bls.gov/cgi-bin/surveymost.

22.

For example, the Constitution vests Congress with the power to "fix the Standard of Weights and Measures" and to establish a patent system, functions central to manufacturing and trade in manufactured goods. In 1791, Treasury Secretary Alexander Hamilton presented his "Report on the Subject of Manufactures" to Congress with policy recommendations to foster the development of manufacturing in the United States. The Morrill Land-Grant Acts enacted in the 1860s granted states federal lands to use for the establishment of colleges "to teach such branches of learning as are related to agriculture and the mechanic arts" to provide, in part, knowledgeable engineers and technicians for the manufacturing sector. A century later, Congress created programs such as the Manufacturing Extension Partnership and the Small Business Innovation Research program to help improve U.S. innovation and manufacturing in response to increased foreign innovation and competition.

23.

The RAMI Act uses the term Network for Manufacturing Innovation (NMI) rather than the National Network for Manufacturing Innovation (NNMI). For consistency and clarity, this report uses the term NNMI.

24.

15 U.S.C. 278s(a)(1).

25.

The RAMI Act uses the term "center for manufacturing innovation," but this report uses the term Institute for Manufacturing Innovation or IMI for consistency.

26.

P.L. 113-235.

27.

Section 703(d)(4)(A).

28.

For purposes of this provision, a covered entity is any federal department, federal agency, instrumentality of the United States, state, local government, tribal government, territory or possession of the United States, or of any political subdivision thereof, or international organization or any public or private entity or individual.

29.

See footnote 28.

30.

As defined in 18 USC 35, Section 201, the term "funding agreement" means "any contract, grant, or cooperative agreement entered into between any Federal agency, other than the Tennessee Valley Authority, and any contractor for the performance of experimental, developmental, or research work funded in whole or in part by the Federal Government. Such term includes any assignment, substitution of parties, or subcontract of any type entered into for the performance of experimental, developmental, or research work under a funding agreement as herein defined."

31.

For more information about the Bayh-Dole Act, see CRS Report RL32076, The Bayh-Dole Act: Selected Issues in Patent Policy and the Commercialization of Technology, by [author name scrubbed].