Executive Office of the President 

Office of Management and Budget 

Executive Office of the President 

Office of Science and Technology Policy 

June 23, 2006 

M-06-17 

MEMORANDUM FOR THE HEADS OF EXECUTIVE DEPARTMENTS AND AGENCIES 

FROM: JOHN H. MARBURGER, III 

 DIRECTOR, OFFICE OF SCIENCE AND TECHNOLOGY POLICY 

 ROB PORTMAN 

 DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET 

SUBJECT: FY 2008 Administration Research and Development Budget Priorities 

This memo highlights the Administration’s research and development (R&D) priorities and 

emphasizes improving management and performance to maintain excellence and leadership in 

science and technology. The memo highlights the President’s American Competitiveness 

Initiative, provides general guidance for setting priorities among R&D programs, identifies 

interagency R&D efforts that should receive special focus in agency budget requests, and 

reiterates the R&D Investment Criteria that agencies should use to improve investment decisions 

for and management of their R&D programs. These updated R&D budget priorities reflect an 

extensive, continuous process of consultation with the President's Council of Advisors on 

Science and Technology (PCAST) and collaboration within the interagency National Science 

and Technology Council (NSTC). 

Presidential Priority: The American Competitiveness Initiative 

To build on America’s unparalleled economic success and to remain a leader in science and 

technology, President Bush has proposed the American Competitiveness Initiative. The 

centerpiece of the American Competitiveness Initiative is the President’s strong commitment to 

double investment over ten years in key Federal agencies that support basic research in the 

physical sciences and engineering that has potentially high impact on economic competitiveness. 

President Bush plans to double investment by the National Science Foundation, the Department 

of Energy’s Office of Science, and the Department of Commerce’s National Institute of 

Standards and Technology core activities. To achieve this doubling within ten years, overall 

annual increases for these three agencies will average roughly seven percent. Specific 

allocations will be based on research priorities and opportunities. In addition to the doubling 

effort at these three agencies, similarly high-impact basic and applied research of the Department 

of Defense should be a significant priority. 
General R&D Program Guidance 

The combination of finite resources, the commitment to the American Competitiveness 

Initiative, and a multitude of new research opportunities requires careful attention to funding 

priorities and wise choices by agency managers. As has been reiterated previously in these 

annual memos, agencies must rigorously evaluate existing programs and, wherever possible, 

consider them for modification, redirection, reduction or termination, in keeping with national 

needs and priorities. They must justify new programs with rigorous analysis demonstrating their 

merit, quality, importance and consistency with national priorities. Agencies may propose new, 

high-priority activities, but these requests should identify potential offsets by elimination or 

reductions in less effective or lower priority programs or programs where Federal involvement is 

no longer needed or appropriate. 

In general, the Administration favors Federal R&D investments that: 

• advance fundamental scientific discovery to improve future quality of life; 

• support high-leverage basic research to spur technological innovation, economic 

competitiveness and new job growth; 

• align with the efforts of the Academic Competitiveness Council and the National Math 

Panel to enable superior performance in science, mathematics and engineering education; 

• enable potentially high-payoff activities that require a Federal presence to attain longterm national goals, including national security, energy security, and a next generation air 

transportation system; 

• sustain specifically authorized agency missions and support the missions of other 

agencies through stewardship of user facilities; 

• enhance the health of our Nation’s people to reduce the burden of illness and increase 

productivity; 

• ensure a scientifically literate population and a supply of qualified technical personnel 

commensurate with national need; 

• strengthen our ability to understand and respond to global environmental issues and 

natural disasters through better observation, data, analysis, models, and basic and social 

science research; 

• maximize the efficiency and effectiveness of the science and technology (S&T) 

enterprise through expansion of competitive, merit-based peer-review processes and 

phase-out of programs that are only marginally productive or are not important to an 

agency’s mission; and 

• encourage interdisciplinary research efforts that foster advancement, collaboration and 

innovation on complex scientific frontiers and strengthen international partnerships that 

accelerate the progress of science across borders.

Agencies are expected to conduct programs in accordance with the highest standards of ethical 

and scientific integrity, and to have clear guidelines on issues such as scientific misconduct, 

conflict of interest, protection of privacy, and the treatment of human subjects. Agency 

participation in coordination of relevant standards through NSTC is expected, following the 

example of the U.S. Federal Policy for the Protection of Human Subjects, known as the Common 

Rule. 

This Administration values science as a basis for effective action in its service to the public, and 

regards the timely, complete and accurate communication of scientific information an important 

part of that service. It is also essential for agencies to be aware of and coordinate within their 

organizations, and with other appropriate offices, the disclosure of information likely to have 
high public interest or impact on markets, regulatory affairs, or public health and safety. 

Accordingly, agencies have already been asked to develop, revise or re-emphasize policies 

related to scientific openness and to ensure that employees and management understand their 

rights and obligations under these policies. All federal employees, including scientists, are 

obliged to distinguish their personal views from the official positions of their agencies, and 

procedures should be in place to ensure that such distinctions are clearly drawn. 

Agencies should maximize the coordination and planning of their R&D programs through the 

NSTC. Two areas requiring special agency attention and focus through the NSTC are Federal 

scientific collections and R&D assessment. 

• Agencies should assess the priorities for and stewardship of Federal scientific collections, 

which play an important role in public health and safety, homeland security, trade and 

economic development, medical research, and environmental monitoring. Agencies 

should develop a coordinated strategic plan to identify, maintain and use Federal 

collections and to further collections research. 

• Determining the effectiveness of Federal science policy requires an understanding of the 

complex linkages between R&D investments and economic and other variables that lead 

to innovation, competitiveness, and societal benefits. An interagency process has been 

established and is now encouraged to promote and coordinate individual agency and 

collaborative actions needed to develop “new science of science policy” for better 

assessing the impact of R&D investments, defining appropriate metrics for measuring 

this impact, understanding the effect of the globalization of science and technology, and 

improving the basis for national science policy decisions. 

Interagency R&D Priorities 

While some priority R&D areas fall mainly within the purview of a single agency, such as the 

President’s space exploration vision at the National Aeronautics and Space Administration, other 

areas require strong interagency coordination. The following interagency R&D priorities should 

receive special focus in agency budget requests. Agencies that receive funding for these 

activities should be prepared to participate in applicable interagency coordination groups to 

produce: 1) a clear and concise definition of program activities and priorities within the overall 

priority area; 2) an inventory of the programs in the baseline budget; 3) agency trade-offs that 

will provide the resources to help produce a coordinated, cross-agency program with greater 

impact than that of the individual activities; and 4) an interagency implementation plan. 

Homeland Security

Almost four years have passed since the publication of the President’s National Strategy for 

Homeland Security which identified the Nation’s S&T enterprise as a key asset in our efforts to 

secure the homeland. All parts of that S&T enterprise, both public and private, have answered 

the call for the development of “new technologies for analysis, information sharing, detection of 

attacks, and countering chemical, biological, radiological, and nuclear weapons.” Despite the 

significant achievements over the past four years, many challenges remain to mitigate 

vulnerabilities. 
Agencies should place increased emphasis on R&D efforts that support: 

• quick and cost-effective sampling and decontamination methodologies and tools for 

remediation of biological and chemical incidents; 

• the development of integrated predictive modeling capability for emerging and/or 

intentionally released infectious diseases of plants, animals and humans, as well as for 

chemical, radiological or nuclear incidents, and the collection of data to support these 

models; 

• the exploitation of recent advances in biotechnology to develop novel detection systems 

and broad spectrum treatments to counter the threat of engineered biological weapons; 

• the development of novel countermeasures against the natural or intentional introduction 

of agricultural threats, including R&D on new methods for detection, prevention, and 

characterization of high-consequence agents in the food and water supply; 

• transformational capabilities for stand-off detection of special nuclear material and 

conventional explosives; 

• biometric recognition of individuals for border security, homeland security, and law 

enforcement purposes in a rapid, interoperable, and privacy-protective manner; and 

• recognizing and expediting safe cargo entering the country legally, while securing the 

borders against other entries. 

Energy Security

In his 2006 State of the Union address, President Bush launched the Advanced Energy Initiative 

(AEI) to take new, bold steps toward the goal of reliable, affordable and clean energy for all 

Americans. Agencies should seek ways to support the AEI through fundamental research 

targeting scientific and technical breakthroughs in two vital areas: diversifying energy sources 

for American homes and businesses; and increased vehicle efficiency and acceleration of the 

development of domestic, renewable alternatives to gasoline and diesel fuels. Power 

diversification possibilities include advanced clean coal and carbon sequestration processes, new 

semiconducting materials that more efficiently convert sunlight directly to electricity, wind 

energy dynamics, and clean and safe nuclear energy. Numerous opportunities for alternative 

fuels range from bio-based transportation fuels such as ethanol, to advanced battery technologies 

to extend the range of hybrid vehicles and make possible “plug-in” hybrids and electric cars, to 

hydrogen as promoted through the President’s Hydrogen Fuel Initiative. 

Advanced Networking and High-End Computing

Under the Networking and Information Technology R&D (NITRD) program, agencies should 

continue to emphasize their investments in high-end computing. In addition, agencies should 

give priority to R&D in advanced networking technologies and cyber security. Advanced 

networking activities should target research on hardware, software, and tools (including largescale testbeds) for the design of secure, reliable, and scalable data communication networks for 

high-speed transmission of extremely large data sets. Advanced networking research conducted 

by agencies with large investments in high-end computing facilities should emphasize enhancing 

the utility and the scientific impact of such facilities. In the area of cyber security, agency plans 

must be consistent with the 2006 Federal Plan for Cyber Security and Information Assurance 

R&D; should address any mission-relevant gaps identified in the Federal Plan; and should 

emphasize coordination, leveraging the efforts of all agencies and, where appropriate, use of 

coordinated multi-agency investments. Agencies supporting R&D in these and other on-going 

components of the NITRD program are expected to participate in interagency planning through 

the NSTC to help prioritize future investments. 
National Nanotechnology Initiative

Continued Federal investment in the agency programs that make up the National 

Nanotechnology Initiative (NNI) facilitates breakthroughs and maintains U.S. competitiveness in 

this field. The NNI should support both basic and applied research in nanoscience, develop 

instrumentation and methods for nanoscale characterization and metrology, and disseminate new 

technical capabilities, including those to help industry advance nanofabrication and 

nanomanufacturing. Because research at the nanoscale offers natural bridges to interdisciplinary 

collaboration, especially at the intersection of the life and physical sciences, the Administration 

encourages novel approaches to accelerating interdisciplinary and interagency collaborations. 

Activities such as joint programs utilizing shared resources or leveraging complementary assets, 

as well as support for interdisciplinary activities at centers and user facilities should receive 

higher relative priority. To ensure that nanoscience research leads to the responsible 

development of beneficial applications, high priority should be given to research on societal 

implications, human health, and environmental issues related to nanotechnology and agencies 

should develop, where applicable, cross-agency approaches to the funding and execution of this 

research. 

Understanding Complex Biological Systems

Agencies should target investments toward the development of a deeper understanding of 

complex biological systems, which will require collaborations among physical, computational, 

behavioral, social, and biological scientists and engineers who will, among other things, need to 

develop the data management tools and platforms necessary to facilitate this research. Access to 

new biotechnological tools and increasing amounts of genetic sequence data will open new 

avenues for research into the functional implications of gene expression. At the same time, 

rapidly developing methods and capabilities within the behavioral and social sciences are 

enhancing our knowledge of organisms and larger systems and providing greater insight into the 

relationship between biological, physiological and cultural influences on human behavior and 

decision-making. Continued research at both the cellular/sub-cellular and the organism/ 

community levels has the potential to have significant impact on national security and homeland 

security, health, environmental management, and education. In particular, this research is 

relevant to the prevention and treatment of infectious disease, and to inherently complex issues 

such as obesity, which should remain a priority area for interagency research coordination. 

Environment

The Administration’s environmental research initiatives are critical for achieving sustained 

economic growth while ensuring a healthy environment. 

Global earth observations support research in a wide range of sciences important for society. The 

U.S. Strategic Plan for an Integrated Earth Observations System provides guidance for agencies 

contributing to these efforts and establishes six Near Term Opportunities that serve as the focal 

point of U.S. R&D activities. Agencies are encouraged to align their R&D programs in this area 

with the recommendations in the U.S Group on Earth Observations’ annual report, Development 

of the U.S. Integrated Earth Observations System: Progress and Recommendations for the Way 

Forward. 
Investments in global climate change science and technology continue to improve our 

understanding of climate variability and change, provide the basis for sound long-term climate 

policy decision-making by helping to reduce uncertainty in climate projections, and enable the 

development of new technologies. Agencies should continue to support the goals of the 2003 

Strategic Plan for the U.S. Climate Change Science Program and continue to work together to 

develop the Synthesis and Assessment Reports called for in that report. 

Agencies are encouraged to continue implementing activities outlined in the Administration’s 

2004 U.S. Ocean Action Plan, to continue to participate in the development of an Ocean 

Research Priorities Plan and Implementation Strategy and to begin aligning their budgets to 

match the emerging priorities that will be finalized this year, and to integrate U.S. ocean 

observing efforts into the Global Earth Observation System of Systems. 

U.S. and global supplies of fresh water continue to be critical to human health and economic 

prosperity. Agencies, through the NSTC process, are developing a coordinated, multi-year plan 

to improve research aimed at understanding the processes that control water availability and 

quality, and to improve collection and availability of the data needed to ensure an adequate water 

supply for the future. Agencies should participate in the finalization of this plan and in its 

subsequent implementation. 

Research and Development Investment Criteria 

The President’s Management Agenda directs agencies to use the R&D investment criteria to 

improve investment decisions for and management of their R&D programs. Under this 

initiative, three primary criteria apply to all R&D programs: relevance; quality; and performance. 

 

Industry-relevant applied R&D must meet additional criteria. The specific activities that 

programs should undertake to demonstrate fulfillment of the R&D investment criteria are 

described in a previous year’s memorandum, which is available at: 

http://www.whitehouse.gov/omb/memoranda/m03-15.pdf

Many of these specific activities have been incorporated into the Program Assessment Rating 

Tool (PART) that has been tailored for R&D programs. Agencies should use the criteria as 

broad guidelines that apply at all levels of Federally funded R&D efforts, and they should use the 

PART as the instrument to periodically evaluate fulfillment of the criteria at the program level. 

The R&D criteria have benefited from years of working with agencies, other stakeholders, and 

experts in assessment, to build on the best of existing R&D planning and assessment practices. The 

R&D investment criteria continue to: 

• Provide tools for programs, agencies, and policy makers to select, plan, and manage R&D 

programs effectively, to increase the productivity of the Federal R&D portfolio and the return 

on taxpayer investment; 

• Help convey the Administration’s expectations for proper program management; 

• Set standards for information to be monitored and provided in program plans and budget 

justifications; and 

• Ultimately improve public understanding of the potential benefits and effectiveness of the 

Federal investment in R&D.