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Government Affairs Program SPECIAL UPDATE

President Bush's Fiscal Year 2002 Budget Part 1:

Major Cuts to USGS, DOE Fossil Energy Programs

(Posted 4-10-01)

This update was originally sent out as an e-mail message to AGI's member societies.

IN A NUTSHELL: On Monday, President Bush released the details of his Fiscal Year 2002 budget request for Congress, having released an outline in early March. As expected from that earlier blueprint, science funding did not fare well. For the geosciences, the big losers were the U.S. Geological Survey and the Department of Energy Fossil Energy research program. The National Science Foundation’s Geoscience Directorate is slated for a small cut as is NASA's Office of Earth Science. NOAA and Department of Energy science programs would receive flat funding, and science programs at EPA would go down slightly. This update focuses on the two geoscience programs facing the largest reductions: USGS and DOE Fossil Energy. A subsequent update will review the president’s requests for NSF, NASA, EPA, NOAA, and other DOE and Interior programs.


What a difference a year makes. A high-flying economy has given way to a bear market, and a new president is determined to rein in federal spending in order to make room for a giant tax cut. As a result, the new budget request for geoscience programs primarily consists of bad news and worse news. A strong show of support from the geoscience community and an internal education effort helped to reduce a cut to the U.S. Geological Survey (USGS) from 22 percent initially to 7.9 percent in the final request. The cut is not evenly distributed -- the Water Resources Division faces a 21 percent decrease compared to 5-7 percent cuts in the other divisions.

The reduction in the Survey’s budget pales in comparison to the cuts for petroleum and natural gas research programs in the Department of Energy (DOE) Office of Fossil Energy. The cuts reflect a major shift by the new administration toward "clean coal" research.

U.S. Geological Survey

Last year, the U.S. Geological Survey (USGS) requested its largest increase ever. It was a small step forward after years of budgetary stagnation interrupted only by the addition of functions from the abolished National Biological Service and U.S. Bureau of Mines. The Survey ultimately received $882.8 million in FY 2001. This year's $813.4 million request would take the Survey back to FY 2000 levels, but two year's worth of inflation means that the real-dollar total is lower than FY 2000. According to budget documents, the USGS "proposes to focus resources on high priority programs, including meeting the science needs of the Department and land management programs, and to reduce funding for programs that primarily benefit external customers." How's that for service with a smile?

Because most uncontrollable cost increases (e.g. cost-of-living adjustments) are to be covered by program cuts or otherwise absorbed, the total programmatic reduction is $90.4 million, or roughly a 10 percent cut. According to Department of the Interior budget documents, this budget request would result in a loss of 506 jobs at USGS -- over a 5 percent reduction. It is the largest staff reduction of any Interior bureau and represents 30 percent of the job losses in the entire department.

The Geologic Division would receive $213.8 million, down 5.1 percent from FY 2001. Geologic mapping is particularly hard hit, erasing the advances made the previous year. The National Cooperative Geologic Mapping program would receive a $6 million cut, and the Survey would save $500,000 by eliminating the USGS partnership with the Central Great Lakes Geologic Mapping Coalition. Other cuts include a $3 million reduction in global change research and elimination of the international minerals information program ($2 million). Cuts are also made to congressionally earmarked funds for specific projects, including the Alaska Minerals Information project, the Puget Sound LIDAR consortium, and an eastern Gulf of Mexico coastal pilot program.

The Water Resources Division is by far the hardest hit of the four divisions, taking a 21.6 percent reduction from $203.5 million in FY 2001 to $159.5 million in FY 2002. The bulk of the reduction would be accomplished by eliminating the Toxic Substances Hydrology program (a $10 million cut) -- despite the observation that it "has generated significant information about the sources, fate, and persistence of toxic substances in ground and surface water" -- and reducing the National Water-Quality Assessment (NAWQA) program by $20 million, halting its next phase. These programs are being cut because they primarily benefit entities outside the Department -- including other federal agencies, state and local government, and foreign governments. In the future, USGS is expected to seek funding from these partners who "rely on USGS to provide information to help them fulfill their own mission-critical responsibilities." (Read: EPA, whose funding is down 6.4 percent this year.)

In an annual ritual, the request eliminates support for the Water Resources Research Institutes ($5.5 million). It also cuts the Water Information Delivery program by $3 million and the streamgage network by $5 million. Both geologic mapping and the streamgage network benefited in FY 2001 from funds provided under Title VIII of the FY 2001 Interior appropriations bill, which authorized a six-year Land Conservation, Preservation, and Infrastructure program. This program distributes royalties collected from offshore oil and gas activities. Although the administration has requested full funding of nearly $1 billion for this fund in FY 2002, it has chosen to shift most of the money toward the National Park Service and direct state grants. USGS funding will drop from $25 million to zero.

The National Mapping Division would receive $123.7 million, a 5.2 percent cut. The request eliminates funding for the OhioView consortium ($3 million), discontinues the Urban Dynamics program ($1.1 million), and cuts $2.5 million from the Mapping Information and Delivery program. It also eliminates $2 million in Title VIII funding for Mapping State Planning Partnerships, all part of an "shifting the costs of information delivery to the program beneficiaries."

The request for the Biological Resources Division is $149.3 million, down 7.0 percent. Decreases include $3.5 million for the GAP program, which had received $3 million in Title VIII money in FY 2001. The request eliminates the National Biological Information Infrastructure program ($4 million) and transfers wildland fire research ($2.8 million) to a separate department-wide account.

Finally, the USGS is transferring the bureau's library from the Facilities account to the Science Support account. According to USGS budget officials, the transfer was funding neutral.

Department of Energy Fossil Energy R&D

The recent focus on developing a domestic energy policy has not had a positive result on funding for the Department of Energy (DOE). Secretary Spencer Abraham noted in his statements at the budget briefing that "the outcome of Vice President Cheney’s Energy Policy Development Task Force will determine our energy policy and energy resources budgets" for the coming years.  In the interim, the DOE Office of Fossil Energy (FE) is marked for a 17.1 percent decrease for FY 2002, to total $449 million.  Within this decrease, only two programs received an increase -- the new presidential clean coal initiative and the carbon sequestration research program.

President Bush's Clean Coal Power Initiative was the big winner with $150 million -- nearly a third of the entire FE budget.  This allocation is the first step in a "ten-year, $2 billion commitment to clean coal R&D."  This new initiative builds on the Clinton Administration's Power Plant Improvement Initiative that began last year. It is a joint government-industry program designed to explore the barriers and technologies needed to make current and future coal-fired generators cleaner and more efficient.

The other winner in FE was the Sequestration R&D program, marked for a 10.3 percent increase to total $20.7 million. According to the budget document: "The major thrust in FY 2002 will center around exploratory research on novel and innovative concepts for greenhouse gas emission mitigation such as increasing the carbon uptake of terrestrial plants or soils, advanced carbon dioxide separation and capture concepts, and storing greenhouse gasses in geologic formations or in the deep ocean."

To make room for these initiatives, many of the established programs received large cuts -- most over 50 percent. The Natural Gas R&D program request is $21 million, a 53.4 percent decrease from last year’s allocation.  Within the Natural Gas program, Exploration and Production activities are targeted for a 34.5 percent decrease, to total $9.3 million.  Gas Hydrate activities would be funded at $4.7 million, a 52.5 percent cut.  Funding for coal-bed methane research is cut by 97% to total $200,000.

The Petroleum R&D program is slated for a 54.4 percent cut to total $30.5 million.  Within this amount, $20.3 million will go towards petroleum exploration and production, a 29.5 percent decrease from last year’s funding.  According to budget documents: "The program plans to reduce research on oil basin analysis, smart well technology, advanced recovery methods, and fundamental technologies for frontier oil production."

Cooperative Research and Development activities will be zeroed out under the budget request. "The program traditionally supported 50/50 cost-shared R&D projects with private industry.  Although no funding is requested for FY 2002, the Office of Fossil Energy (FE) will continue to pursue cooperative research with other government agencies, academic institutions, and private industry within each of its technology line items."

Special update prepared by David Applegate and Margaret Baker, AGI Government Affairs.

Sources: DOE and USGS budget documents

Please send any comments or requests for information to the AGI Government Affairs Program.

Posted April 10, 2001

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