49 



24 / IMPROVING THE ALLOCATION PROCESS 



difficult questions arise with subsidized partnership programs such as the ATP — will 

 they succeed in fostering new, commercially relevant technologies that otherwise 

 would not develop as quickly, and are they the most efficient uses of increasing!)' 

 scarce federal R&D dollars? The committee is skeptical that the answer to these 

 questions is yes. It therefore believes that these subsidized industrial partnership 

 programs should be continued only if the case is convincingly made that the govern- 

 ment is the funder of last reson for an important enabling technologs; and they 

 should be pursued only on an experimental basis, with careful attention to their 

 goals, the distribution of proprietary' rights, and how they will be evaluated. '^Iiere 

 a new technolog\' is needed to address a specific mission such as a military need. 

 however, federal leadership is better justified, as noted in the first bulleted item 

 under Recommendation 8. 



RECOMMENDATION 9- FS&T budget decisions should give 

 preference to funding projects and people rather than institu- 

 tions. That approach will increase the flexibility in responding 

 to new opportunities and changing conditions. 



Compared to most other developed countries, the United States awards ;i 

 higher fraction of its research and development funding to specific projects as 

 opposed to distributing funds through institutional or formula grants. This mode of 

 funding has several important advantages. It promotes the scientific and technical 

 qualin,' and originality' of proposals; it permits awards to be made on the ba.'^is of 

 competitive merit review procedures; and, by investing in projects and people 

 rather than institutions, it makes the research and development system more flex- 

 ible and responsive to changing scientific opportunities and national needs To- 

 gether those features have created a broad base of first-rank research institutions 

 across the country that have adapted to major shifts in federal research and develop- 

 ment priorities over time. 



Tlie committee strongly endorses the principle of favoring the suppon of 

 projects and people over institutions. The pace of scientific discover}- has quick- 

 ened and the time from discover^' to innovation and commercialization is becoming 

 shorter in many fields, which makes the flexibilit}' and responsiveness of the re- 

 search and development system increasingly crucial. To free up or reallocate re- 

 sources to meet new opportunities and needs, it is much easier to cut back or 

 eliminate a program of project grants than it is to disengage from support of institu- 

 tions. If an agency's budget is cut, there is a danger that funds will be taken :>uto- 

 matically from its extramural program. Instead, the available funds should be allo- 

 cated to those people and projects best able to accomplish the task — whether in 

 universities, federal laboratories, or other institutions. 



In the future, there should be a presumption against establishing new perma- 

 nent institutions. Moreover, the establishment of any such institutions and major 

 programs or centers should include a time limit or "sunset" provision, along with 

 periodic review. 



