Overview
Federal R&D funding—public dollars allocated by the US government to support scientific and technological progress—is among the strongest policy tools for shaping national innovation. Spawned out of Cold War ambitions to demonstrate and advance US technological superiority, today’s federal R&D enterprise spends $200 billion annually to initiate, accelerate, and guide progress at the frontiers of discovery.
More than 30 federal agencies fund hundreds of thousands of researchers in universities, companies, and government labs to achieve breakthroughs across the full innovation pipeline—from gaining fundamental knowledge to bringing promising nascent technologies to large-scale use. These investments have driven many of the most important technological advancements since World War II: the Internet, GPS, and voice recognition systems; the mapping of the human genome and the development of virtually all major vaccines; solar panels, nuclear energy, and shale gas extraction; autonomous vehicles and fuel-saving aviation technologies; and foundational advances in computing, artificial neural networks, and microchips.
This guide explains how and why the US government funds R&D, outlines key institutions and processes, and discusses considerations and opportunities for working in R&D policy.
Why does the government invest in R&D?
There are several main justifications for federal R&D funding:
- Addressing market failures: The private sector tends to underinvest in basic and high-risk1 research. Long timelines, high capital costs, and uncertain payoffs can make early-stage R&D unattractive to private investors, especially when the benefits are broadly shared (e.g. vaccines, clean air, foundational science). Public funding fills these gaps, supporting work that has high societal value but low profitability or high barriers to entry.2
- De-risking emerging technologies: Many promising technologies face a “valley of death” between discovery and commercialization—a period where lengthy timelines to profitability or high technical uncertainty can deter private investment. Government funding helps bridge this gap by supporting prototyping, testing, and scale-up efforts that are too risky for private capital, shouldering risk until new technologies can attract private backing. This is particularly common in biotechnology, where long development timelines, complex regulatory requirements, and high upfront costs make it difficult for companies to secure sustained private investment.3
- Advancing national priorities: Federal R&D investments often support national goals that markets wouldn’t independently pursue, like national defense, pandemic and natural disaster preparedness, energy security, rural broadband, or resilient supply chains for critical technologies.
- Steering technology toward public values: By funding and overseeing R&D, the government can steer technological progress in line with values like safety, privacy, and openness. For example, the government developed GPS for defense, but made it freely available for civilian use worldwide.
- Responding to crises: The US government often responds to crises by coordinating, mobilizing, and funding private sector R&D. During World War II, federal agencies partnered with scientists and industry to rapidly advance technologies like radar, mass-produced antibiotics (e.g. penicillin), and the atomic bomb—some of which launched entire postwar industries. In response to COVID-19, the federal government launched Operation Warp Speed—a public-private partnership that invested over $18 billion to deliver 300 million vaccine doses in less than a year.
- Workforce development: Many federal R&D programs explicitly aim to train the next generation of scientists, engineers, and technologists. Programs like NSF’s Graduate Research Fellowship Program or DOE’s Computational Science Graduate Fellowship directly fund student researchers, while R&D investments broadly create demand for technical talent across academia, national labs, and private contractors.
Federal R&D funding basics
Federal R&D funding spans four main categories4:
- Basic research, which seeks to expand fundamental understanding of the world without a specific application in mind (e.g. studying how plant genes change);
- Applied research, which uses scientific knowledge to address practical problems (e.g. identifying genetic traits to improve drought tolerance);
- Development, which builds on applied research to create or improve actual products, tools, or processes (e.g. designing a drought-resistant crop variety); and
- Commercialization and technology transition, which helps innovations reach end users. This stage involves scaling, adapting, and often transferring technology to the private sector or other agencies5 (e.g. scaling seed production for widespread agricultural use).
Department of Defense funding categories
The Department of Defense (DOD) organizes its R&D investments through Budget Activity 6, which encompasses all Research, Development, Test, and Evaluation (RDT&E) activities. This budget activity is divided into eight distinct categories that correspond to different stages of the technology development lifecycle:
| Budget activity code | Description |
| 6.1 | Basic Research |
| 6.2 | Applied Research |
| 6.3 | Advanced Technology Development |
| 6.4 | Advanced Component Development & Prototypes |
| 6.5 | System Development & Demonstration |
| 6.6 | RDT&E Management Support |
| 6.7 | Operational Systems Development |
| 6.8 | Software and Digital Technology Pilot Programs |
This standardized framework enables all military departments (Army, Navy and Air Force) to consistently track and report R&D expenditures according to where projects fall in the development pipeline. These activity codes are commonly referenced as shorthand in defense circles—for example, professionals routinely refer to projects as “6.1 funding,” “6.3 programs,” or could discuss “transitioning from 6.2 to 6.4.”
The US government plays an outsized role in earlier stages of the R&D pipeline—particularly in basic research, where private investment tends to be lowest due to long timelines, high uncertainty, and limited short-term profitability.

While more than 30 federal agencies fund R&D, the vast majority of federal dollars flow through a few key players. Together, the Department of Defense (DOD) and the Department of Health and Human Services (HHS), primarily through the National Institutes of Health (NIH), account for ~75% of total federal R&D spending, with the remaining 25% primarily spent by the Department of Energy (DOE), NASA, and the National Science Foundation (NSF). We’ll explore each of these agencies in more detail below.

Federal R&D funding has increased in absolute dollars since the 1970s—rising from about $90 billion in 1976 to around $190 billion in 2023 (in constant 2022 dollars)—but has steadily declined as a share of the federal budget, falling from nearly 12% in the 1960s to under 3% today. See more historical trends in R&D funding here.

Most R&D funding goes to external (“extramural”) research institutions like universities and private companies, but ~30% supports in-house (“intramural”) research at government labs. Funding for external researchers flows through a mix of competitive grants, contracts, and other mechanisms. We’ll explain these funding mechanisms in more detail below.
Funding models and mechanisms
Federal R&D programs don’t just vary in what they fund—they also differ in how they fund it. One helpful distinction is between:
- Funding models reflect the government’s overall strategy for designing and managing research programs, defining the level of risk, timeline, oversight, and who sets research priorities.
- Funding mechanisms are the concrete tools agencies use to deliver funding (e.g. grants, contracts, prizes).
Most programs fall into one of several broad funding models6:
- Traditional programs support long-term, steady research, usually in well-established fields. These programs operate through a researcher-initiated model where scientists7 propose projects that experts evaluate for scientific merit, technical feasibility, and potential impact. As the dominant funding mechanism for both NIH and NSF, traditional programs represent the largest share of federal R&D expenditures. These programs primarily use competitive grants and cooperative agreements, with comparatively less agency involvement once funding is awarded. While both NIH and NSF fall under this model, their internal processes differ: NIH relies heavily on external peer review panels, often composed of field experts, to assess proposals, while NSF program officers play a more hands-on role in selecting reviewers, synthesizing feedback, and making final award decisions.
- ARPA-style programs (Advanced Research Project Agencies) are designed for “high-risk, high-reward” R&D. ARPA Program Managers (PMs) define bold technical goals and manage fast-paced portfolios with hands-on oversight, actively shaping external teams and adjusting priorities in real time. These programs typically rely on contracts, milestone-based funding, and Other Transaction Authorities (OTAs) to enable flexible, performance-driven management. This model characterizes the “ARPAs”—certain federal subagencies that support research in pursuit of their parent department’s mission (e.g. DARPA for defense, IARPA for intelligence, ARPA-E for energy, and ARPA-H for health).
- Translation and commercialization programs focus on scaling up and transitioning mature technologies to real-world use. These programs aim to bridge the “valley of death” between research and deployment, using tools like milestone-based funding, commercial partnerships, and tailored contracting mechanisms. Key examples include BARDA within HHS, the Defense Innovation Unit within DOD, and the intelligence community’s VC investor In-Q-Tel.
- Moonshot programs pursue ambitious national goals, like curing cancer or landing on the moon. They often span multiple agencies and stages of R&D, often blending grants, contracts, prizes, and advance market commitments depending on the goal and stage. Moonshots may also contain ARPA-style subprograms and public-private partnerships to speed translation and impact.
Each program also uses a different mix of funding mechanisms to meet its goals. These mechanisms vary in how they distribute risk, structure incentives, and balance agency control with performer flexibility:
| Funding mechanism | How it works | Best suited for | Limitations | Examples |
| Grants | Researchers propose projects; funding awarded through peer review based on merit and feasibility | Basic science, academic research, early-stage exploration | Slow funding cycle; favors experienced grantees; limited agency control after award | NIH R01, DOE Office of Science grants, NSF CAREER awards, Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs |
| Contracts | Government defines deliverables, timeline, and outcomes; funds awarded through procurement process | Applied R&D, mission-driven technology development with clear government need (common in defense, intelligence, and national security) | Rigid structure; intense oversight; not well-suited for exploratory research | ARPA programs; DOD weapons development contracts |
| Cooperative agreements | Similar to grants, but with much greater agency involvement in design and execution | Cross-sector or cross-agency efforts, public-private collaboration, pilot programs, or technology demonstration projects | Higher administrative requirements | NIH clinical trials, DOE energy demonstration projects |
| Prize competition8 | Government defines a problem; funding awarded to whoever solves it first or best | Seeding innovation in areas with diffuse expertise or no obvious solution path | No early-stage funding; limited for long R&D timelines or capital-intensive work | DOE Grid Optimization Challenge, DARPA AI Cyber Challenge, Grand Challenge |
| Advance market commitments (AMCs) | Government guarantees purchase of a technical product or solution once it meets specified criteria | Achieving outcomes with known technical feasibility but weak commercial incentives | Requires clear standards and long-term political will; limited to scalable products | COVID-19 vaccine pre-purchases, Gavi AMC for pneumococcal vaccines 9 |
| Resource provision | Providing facilities, equipment, and other resources to researchers | Enabling R&D that requires expensive or centralized infrastructure | Less flexible; often requires researchers to fit into existing infrastructure constraints | DOE national labs, NIH Data Commons, government-funded computing and data resources |
| Loans & loan guarantees | Government provides direct loans or guarantees repayment of private loans, reducing investor risk in capital-intensive projects | Commercialization and scale-up in sectors with high capital needs and long ROI timelines (and long-term viability) | Can be politically risky if projects fail | DOD Office of Strategic Capital, DOE Loan Programs Office (e.g. Tesla seed funding) |
| Other Transaction Authorities (OTAs) | Agencies negotiate flexible agreements outside standard procurement laws, not governed by Federal Acquisition Regulation (FAR) rules | High-risk, rapid R&D; prototyping; and public-private partnerships, especially for defense | Limited to authorized agencies; legal complexity; less transparent than grants or contracts | DARPA and DIU prototyping efforts, ARPA-H project agreements, NASA collaborations |
| Milestone-based funding10 | Funding is released in stages only after recipients meet predefined technical or developmental milestones | High-risk, high-reward R&D where performance needs to be monitored closely (e.g. bio, health, defense) | Requires close oversight; may not be suitable for exploratory or long-horizon research | BARDA COVID-19 vaccine support |
Federal R&D funding and emerging technology
Federal R&D funding is one of the US government’s most powerful levers for driving technological innovation and strategic growth. Many of today’s transformative technologies—including AI, biomanufacturing, and quantum computing—received early-stage support from public R&D and continue to benefit from sustained investment. This support influences not only early-stage discovery and development, but also who participates in emerging tech ecosystems, which markets succeed, how quickly breakthroughs reach end-users, and how innovation aligns with national goals.
In some sectors—particularly defense, energy, and health—federal R&D can also influence downstream adoption. For example, military departments often fund the full lifecycle of emerging technologies, from initial research to deployed systems, creating built-in markets for novel technologies like autonomous drones, bioengineered materials, or AI-enabled targeting tools.
Many technologies that define the modern economy began as federal R&D intiatives:
- The Internet (originally ARPANET) emerged from a 1969 ARPA11 experiment to create secure communications networks between research facilities. Government funding and coordination between DARPA, NSF, and other agencies helped bring it to its modern commercial form.
- GPS began as a military navigation tool developed by DOD in the 1970s and 1980s. Today, it underpins nearly every form of modern transportation—from ride-hailing to aviation to supply chain logistics.
- Smartphones depend on government-originated components, including multi-touch screens (NSF), microprocessors (DOD/NASA), lithium-ion batteries (DOE), and voice assistants (DARPA’s PAL project, which became Siri).
- AI owes key advances to sustained public funding—from neural network research and reinforcement learning in the 1980s and 90s to today’s NSF-led National AI Research Institutes and DARPA’s “AI Next” campaign.
- Google search algorithm: An NSF-funded project developed a “PageRank” prototype in the early 1990s that now serves as one of the main components of Google search.
- Self-driving cars emerged from DARPA’s Grand Challenges in the early 2000s—the agency’s first major attempt to use a prize-based competition to attract novel performers. This multi-million dollar contest series effectively launched the self-driving technology industry, with many participants later joining Google, Uber, and other private robotics teams.12
- Semiconductors and microelectronics were significantly accelerated by federal investment. Defense contracts and military performance standards helped build domestic supply chains, while R&D support from DARPA and NSF enabled miniaturization and scale.
- Biotechnology and genomics—from gene editing to synthetic biology—trace back to decades of NIH, DOE, and NSF support. DOE and NIH coordinated the Human Genome Project, a 13-year, landmark global scientific effort that produced a sequence accounting for 90% of the human genome. Over 70% of US-based Nobel Laureates in chemistry, physics, and medicine were funded by NSF during their careers.
A section below provides more examples of emerging technology offices and initiatives in major R&D funding agencies.
Major recent developments in AI R&D funding
- November 2025: The White House Office of Science and Technology Policy (OSTP) issues a Request for Information on “Accelerating the American Scientific Enterprise,” soliciting proposals to modernize federal R&D funding, strengthen regional innovation ecosystems, and prepare for AI-driven advances in scientific research.
- June 2025: The Senate reconciliation bill adds $150 million for DOE AI R&D, including funding to make DOE’s scientific datasets “AI-ready” and to launch seed efforts for self-improving AI models for science and engineering.13
- June 2025: The Trump administration’s FY2026 budget proposal includes significant R&D funding cuts. On AI, these include a 65% cut to NSF’s Computer and Information Science and Engineering (CISE) directorate, a 43% cut to its Technology, Innovation, and Partnerships (TIP) directorate, and large cuts to workforce programs like the Graduate Research Fellowship Program. The proposal also included increases for some AI-relevant R&D offices, including DARPA.
- December 2024: Biden’s FY2024 budget proposal includes $200 million in R&D funding “to harness the capacity of AI to accelerate scientific research across a variety of disciplines at multiple agencies.”
- December 2024: National Nuclear Security Administration (NNSA) and Lawrence Livermore National Laboratory (LLNL) announce the official verification of El Capitan as the world’s most powerful supercomputer, achieving 1.742 quintillion floating-point operations or calculations per second. The achievement follows decades of R&D investment and partnerships with Hewlett Packard and AMD.
- October 2023: President Biden’s Executive Order on AI directs NSF to launch a pilot National AI Research Resource (NAIRR), a shared computing and data infrastructure to support AI R&D.
- May 2023: NSF announces $140 million in new funding to establish seven National AI Research Institutes focused on trustworthy AI, cybersecurity, education, and other sectors, bringing total NSF investment in the AI Institutes program to nearly $500 million.
- August 2022: President Biden signs the CHIPS and Science Act, authorizing major increases in federal R&D funding. The law provides $36 billion in new NSF funding over five years, including $20 billion for a new Directorate for Technology, Innovation and Partnerships (TIP) focused on critical technologies like AI and quantum computing.
- July 2021: NSF, in partnership with USDA, DHS, and other agencies launches 11 new National AI Research Institutes with $220 million in funding, expanding the program’s reach to 40 states. Research areas include food systems, AI-augmented learning, edge computing, and more.
- January 2021: Congress passes the National AI Initiative Act of 2020 as part of the FY2021 NDAA, formalizing a coordinated national AI R&D strategy and establishing the National AI Initiative Office within the Office of Science and Technology Policy (OSTP) to coordinate federal AI research programs and collaboration across sectors.
- August 2020: The White House, NSF, and DOE announce over $1 billion in AI and quantum information science research funding, including $140 million for seven NSF-led National AI Research Institutes. These institutes focus on machine learning, climate modeling, and advanced manufacturing.
- February 2020: President Trump’s FY2021 budget outlines plans to double non-defense AI R&D spending by 2022, with NSF’s AI funding rising to over $850 million.
- February 2019: President Trump’s Executive Order on American Leadership in AI launches the American AI Initiative, directing federal agencies to prioritize AI R&D and directing the Office of Management and Budget (OMB) and the Office of Science and Technology Policy (OSTP) to ensure sustained investment in core AI research.
- September 2018: DARPA launches its AI Next campaign, committing over $2 billion in R&D across more than 20 programs to advance context-aware, adaptive AI technologies (“third wave” AI).
Major recent developments in bio R&D funding
- October 2024: The White House issues a first-ever National Security Memorandum on AI that includes biosecurity safeguards for AI-driven research. The NSM directs agencies to test advanced AI models for dual-use biological risks and tasks OSTP and other agencies developing standards for the safe publication of AI-generated computational biology models and datasets.
- February 2024: HHS launches Project NextGen, a $5 billion initiative to support development of next-gen COVID-19 countermeasures, including intranasal vaccines and broadly protective coronavirus treatments, aiming to maintain innovation momentum post-Warp Speed and ensure long-term preparedness.
- October 2022: The Biden administration releases a new National Biodefense Strategy and Implementation Plan, strengthening federal coordination across 20 agencies to detect, prevent, and respond to biological threats.
- September 2022: President Biden’s Executive Order on the Bioeconomy launches the National Biotechnology and Biomanufacturing Initiative to advance US bioeconomy leadership through coordinated R&D, infrastructure, workforce, and data efforts. This order spurred initiatives across government, including DOD’s Biomanufacturing Strategy and biosecurity and biotechnology efforts across DOE.
- August 2022: The CHIPS and Science Act passes, authorizing a National Engineering Biology R&D Initiative and strengthening US synthetic biology and biomanufacturing capabilities as part of broader tech competitiveness investments.
- March 2022: Congress establishes the Advanced Research Projects Agency for Health (ARPA-H) with $1 billion to pursue transformative, high-risk biomedical breakthroughs outside traditional NIH grant mechanisms.
- February 2022: President Biden re-launches the Cancer Moonshot, aiming to cut cancer death rates by 50% in 25 years and accelerate breakthroughs in detection, prevention, and treatment.
- September 2021: OSTP and NSC publish the American Pandemic Preparedness Plan, proposing $65 billion in investments over 10 years for vaccine platforms, therapeutics, diagnostics, and early-warning infrastructure.
- May 2020: HHS and DOD launch Operation Warp Speed, the flagship COVID-19 R&D effort to deliver safe and effective vaccines, treatments, and diagnostics in record time, leading to multiple authorized vaccines by the end of 2020.
- September 2019: Trump’s Executive Order on Flu Vaccines directs development of modern flu vaccines and universal vaccine technologies, initiating R&D partnerships and modernization of production methods to prepare for pandemics.
Why (not) work on federal R&D funding?
The case for impact
Federal R&D funding offers opportunities to shape the direction of science and technology from the ground up—often before markets, standards, or governance structures fully form. This gives it several unique advantages as a policy tool:
- Upstream influence on emerging technologies: R&D funding often creates entirely new technological fields before markets exist for them. Early government investment in semiconductors, the internet, and GPS shaped how these industries developed for decades, establishing technical standards, research directions, and competitive advantages that persist today.
- Incentives-based: Unlike regulations or mandates, R&D funding shapes outcomes through positive investment. This enables it to attract talent and resources toward strategic areas while avoiding potentially politically fraught mandates, restrictions, or opposition. That said, R&D funding is not insulated from politics—funding levels can be highly vulnerable to shifting political priorities.
- Supports long-term bets: Public R&D isn’t constrained by short-term market returns. It can fund decades-long technology maturation—from basic science to enabling infrastructure—that wouldn’t otherwise attract sustained private support. It tolerates failure, supports exploration, and isn’t reliant on proven business models.
- Flexible, targeted approach: Compared to broader policy tools like tax credits, R&D programs can be tightly scoped and targeted to specific goals on a project-by-project basis.
- Influence over large-scale public investment: Program managers (PMs)14—the key managers of federal R&D programs—often exercise substantial discretion in shaping funding programs, engaging with researchers, and overseeing large projects.15 A single PM at a federal R&D agency can oversee hundreds of millions in funding decisions over the course of their career. Congressional staff on budget subcommittees (like those overseeing health, defense, or energy) help determine agency budgets worth tens of billions annually. Senior roles at OSTP shape multi-agency research initiatives like the CHIPS and Science Act, and OMB staff influence budget allocations across entire scientific disciplines.
- Built-in policy window: R&D funding operates within the established annual budget cycle, creating predictable opportunities for policy changes without requiring new legislation. Unlike standalone policy initiatives that depend on political momentum and “policy windows” opening, R&D funding adjustments happen during a guaranteed and recurring process, creating a lower-friction pathway to policy change.
- Leveraged impact: Funding research is more leveraged than leading research, which is more leveraged than doing research. By shaping what gets funded, how it’s structured, and who gets to participate, R&D funders can steer entire fields, not just individual projects. This makes federal R&D funding roles some of the most upstream and scalable points of influence in the innovation ecosystem.
The case for professional growth
- Cross-cutting exposure: R&D staff often sit at the nexus of government, academia, industry, and startups—providing a bird’s-eye view of the innovation ecosystem, building an expansive professional network, and offering promising exit opportunities.
- Career flexibility and credentialing: R&D roles—especially program management positions—are high-trust, prestigious jobs. Succeeding in one signals the ability to manage complexity, work across sectors, and exercise sound judgment under uncertainty.
- Autonomy and influence over large-scale investments: Program managers (PMs) often exercise substantial discretion in designing funding programs, evaluating grant proposals, and overseeing large projects. At ARPA agencies, for example, PMs typically lead 2–5 programs simultaneously, with individual program budgets ranging from $20 million to $80 million.16 At traditional R&D agencies like NSF, program officers often manage dozens to hundreds of grants across a thematic area (e.g. quantum materials, STEM education), with collective portfolios valued at $10–50 million or more. While they have less discretion in grant selection (due to peer review), they shape funding priorities, manage award cycles, and engage regularly with the research community.
- Work at the frontier: Federal R&D often backs exploratory, pre-commercial research. This means program staff routinely engage with cutting-edge ideas and work closely with leading researchers in their field, and thus may have visibility into transformative technologies years in advance of most other professions.
Some tradeoffs
- High risk of failure17: Many programs target inherently uncertain or speculative technologies, meaning that many efforts won’t yield usable results or will fail to overcome the “valley of death”.
- Slow feedback loops: With some exceptions, private firms often underinvest in technologies with long time horizons—it’s difficult to secure investment over multi-decade timeframes, especially with uncertain payouts. This makes the government uniquely well-positioned to fund longer-term R&D. It also means that those working on federal R&D funding may not see its scaled benefits until long after their tenure. One analysis estimated a 20-year average lag from initial R&D funding to technological application.
- Limited downstream control: Federal R&D often catalyzes early-stage innovation but has little authority over how those technologies are ultimately used, regulated, or commercialized. While some funding processes heavily inform deployment (e.g. for defense applications), federal R&D funding historically “gets the ball rolling”—often kickstarting new companies or entire industries with limited control over their ultimate direction or outcomes.18
- Bureaucratic complexity: Federal grantmaking has been criticized for having overly burdensome systems of review and monitoring. In some fields, researchers spend as much time managing bureaucracy as doing science—by one estimate, scientists can spend up to 50% of their time writing grant applications. While some R&D programs (like ARPAs) are structured to minimize regulatory burden, even the most agile federal programs operate within a system that often prioritizes caution and compliance.
- Low political salience: R&D funding can face unique political challenges because its benefits are often uncertain, diffuse, and pay out over long time horizons. Unlike (for example) infrastructure or healthcare programs with visible, immediate impacts, fundamental research rarely has clear beneficiaries. Disease-specific groups (like cancer or Alzheimer’s groups) often advocate for targeted medical research, and large-scale events (like Sputnik) can catalyze public interest, but basic science and early-stage technology often lack organized constituencies. This dynamic makes it harder for politicians to claim credit and for voters to see or anticipate direct value.19
- Institutional bottlenecks: Some have argued the federal R&D system relies on too narrow a set of institutions—primarily universities, which have come to dominate pre-commercial research. This “academic monopoly” can constrain the types of research that get done, slow down translation, and limit institutional experimentation. Researchers working through university labs often face conflicting incentives (e.g. publishing vs. prototyping), bureaucratic frictions, and tech transfer barriers that can dilute the impact of otherwise promising work. Proposals have called for “unbundling” research from traditional university structures and funding new institutions better suited to advancing use-inspired or systems-level technologies.
The funding process: Who’s involved?
The following sections cover key actors at each stage of the federal R&D funding process. In a nutshell, federal R&D funding happens through these stages:
- Budget and policy direction setting: Every year, Congress sets federal spending levels through the appropriations process, determining how much money agencies like NIH, NSF, or DARPA receive for R&D programs, and which priorities those funds should support. Key players include the White House, federal agency leadership, and authorizing and appropriations committees in Congress.
- Grant-making and program execution: Federal agencies design and administer R&D programs, using grants, contracts, and other mechanisms to fund and resource researchers. PMs at agencies like NSF, NIH, DOE, and DOD play a central role in shaping funding calls, selecting projects, and managing award portfolios.
- Conducting the actual R&D: Research is “performed” by an ecosystem of universities, national labs, private companies, and nonprofit research organizations.
- Coordination: Coordination bodies like OSTP, the National Science and Technology Council (NSTC), and interagency working groups work to align federal R&D efforts across agencies and ensure strategic coherence.
- Oversight: Congress, OMB, and watchdog agencies (like Congress’ Government Accountability Office) monitor how R&D funds are used and whether programs deliver results.
Budget and policy direction setting
There’s no single pool of federal R&D funding—rather, total R&D spending is the result of a sprawling annual budget process that spans more than 30 federal agencies, over 300 R&D programs, and multiple layers of political and strategic decision-making. In FY2024, federal R&D spending totaled roughly $210 billion. This process is shaped by the White House, which proposes the budget and sets high-level research priorities; think tanks and external groups, who provide input and advocate for certain changes; and Congress, which finalizes spending levels.
The White House
→ See also our full OMB and OSTP guides.
The budget process begins with the president’s annual budget proposal, which outlines the administration’s strategic goals. Two key White House offices drive this process:20
- Office of Management and Budget (OMB) oversees the development and execution of the federal budget. It develops the president’s annual budget proposal to Congress21, oversees agency operations, reviews regulations and legislation, and ensures that executive branch activities align with the president’s policy agenda.
- Office of Science and Technology Policy (OSTP) advises the president on science and technology (S&T) issues and plays a key role in setting R&D priorities. It evaluates agency proposals, shapes cross-cutting initiatives (e.g. bioeconomy, AI), and ensures research portfolios align with national needs.
Together, OMB and OSTP guide federal R&D investments through a structured budget development process:
- Agency input: Each year, federal agencies submit S&T priorities and funding proposals to OMB and OSTP.
- Joint guidance: Based on these inputs, OMB and OSTP issue a joint memorandum outlining the administration’s R&D priorities and investment criteria. This memo provides strategic guidance for agencies as they develop their budget requests.
- Budget development: Agencies prepare their R&D budgets with OSTP input on scientific quality and alignment with presidential goals. OSTP focuses on science-heavy agencies and crosscutting themes, while OMB oversees overall fiscal policy and spending limits.
- Final review and proposal: OSTP provides scientific and strategic feedback, while OMB determines the final contents of the president’s budget. In many cases, OMB defers to OSTP on S&T questions.
- Congressional decision: The president’s budget is submitted to Congress, which ultimately determines funding levels through the appropriations process.
While OMB and OSTP play the most central roles in shaping the overall direction and coordination of federal R&D funding, other White House offices also contribute in more targeted ways. For example:
- The National Security Council (NSC) helps shape priorities for research areas tied to national defense or foreign policy. NSC may convene interagency working groups, guide classified R&D portfolios, or coordinate national strategies like the National Biodefense Strategy.
- The National Economic Council (NEC) and the Council of Economic Advisers (CEA) provide economic analysis and advice that may inform R&D investment decisions.
Congress
→ See also our full Congress guide.
Once the president’s budget request is submitted, Congress begins the appropriations process—deciding how much funding agencies will receive and what parameters will guide its use. This happens through two legislative processes:
- Authorization bills establish or continue federal programs, define their scope and policy goals, and recommend funding levels.
- Appropriations bills, passed annually, provide the legal authority to spend money on authorized programs.
Through authorizations and appropriations, congressional committees shape the scale, scope, and direction of federal R&D by determining which agencies receive funding increases or cuts, which programs are protected or expanded, and what national priorities receive targeted investment. Congress rarely dictates specific technical research questions; rather, it guides high-level priorities and shapes the long-term trajectories of federal S&T institutions.
In FY2025, seven agencies received ~97% of total federal R&D funding. The most influential congressional committees22 for R&D are those that authorize and appropriate funding for these agencies (see table).23
| Agency | % of total R&D funding | Authorizing Committee(s) | Appropriations Subcommittees |
| Department of Defense (DOD) | 46% | House Armed Services (HASC); Senate Armed Services (SASC) | Defense (House, Senate) |
| Department of Health & Human Services (HHS) (primarily NIH)24 | 25.5% | House Energy & Commerce; Senate Health, Education, Labor, and Pensions (HELP) | Labor, Health and Human Services (LHHS) (House, Senate) |
| Department of Energy (DOE) | 11.6% | House Energy & Commerce; Senate Energy & Natural Resources | Energy and Water Development (House, Senate) |
| National Aeronautics & Space Administration (NASA) | 5.8% | House Science, Space, and Technology (“Science”); Senate Commerce, Science, and Transportation (“Commerce”) | Commerce, Justice, Science (CJS) (House, Senate) |
| National Science Foundation (NSF) | 4.0% | House Science; Senate Commerce | Commerce, Justice, Science (CJS) (House, Senate) |
| Department of Commerce (DOC) | 1.9% | House Science; Senate Commerce | Commerce, Justice, Science (CJS) (House, Senate) |
| Department of Agriculture (USDA) | 1.6% | House Agriculture; Senate Agriculture | Agriculture, Rural Development, FDA (House, Senate) |
See more details on each of these agencies and their major R&D efforts below.
Congressional support agencies also play a role in the R&D process:
- Congressional Research Service (CRS): Provides nonpartisan analysis and reports on federal R&D programs to inform congressional oversight and decision-making.
- Congressional Budget Office (CBO): Produces independent cost estimates and budgetary analyses for proposed legislation, including on R&D funding. CBO assessments can influence whether Congress advances, modifies, or shelves major R&D investments by projecting long-term fiscal impacts and comparing policy alternatives.
While Congress’s most regular influence over R&D comes through the annual budget process, it also holds the authority to create permanent agencies and define their missions through authorizing legislation. Over the past century, Congress has established various key agencies in the federal R&D enterprise—such as, NSF (1950), NASA (1958), ARPA-E (2007), and most recently, ARPA-H (2022).25
External groups (think tanks, nonprofits, industry groups, etc.)
→ See also our full think tank guide.
While formal budget authority lies with Congress, external groups—including think tanks, nonprofits, trade associations, advocacy coalitions, and expert advisory bodies26—also shape the context, priorities, and political feasibility of federal R&D funding decisions, in several ways:
- Policy development and agenda setting: Many think tanks publish research reports and funding recommendations that help define emerging technology priorities.
- Stakeholder mobilization: Interest groups, including professional societies and patient advocacy organizations, lobby Congress and agencies to prioritize specific R&D areas (e.g. Alzheimer’s research).
- Congressional and agency engagement: These groups often provide testimony, briefings, or private consultations to inform authorizers and appropriators.
- Public messaging: Advocacy organizations help translate complex R&D funding issues for the public and build grassroots or coalition support for funding increases or policy shifts.
Examples of external groups involved in the R&D funding process include:
- American Association for the Advancement of Science (AAAS): Publishes annual federal science budget analyses; monitors congressional R&D debates and bills; tracks long-term R&D budget trends and visualizes these through an interactive tool; provides congressional testimony.
- Federation of American Scientists (FAS): Publishes research and op-eds on federal R&D funding; proposes federal R&D initiatives (including via Day One Project).
- Institute for Progress (IFP): Publishes research and op-eds (see a Blueprint for Strategic AI R&D Investment, Lessons from mRNA Vaccine Development); provides congressional testimony (Where Can Federal AI R&D Funding Go the Furthest?); manages the Techno-Industrial Policy Playbook in collaboration with the Foundation for American Innovation, American Compass, and New American Industrial Alliance Foundation
- American Enterprise Institute (AEI): Publishes research and op-eds on federal R&D funding (e.g. Federal R&D Funding is Even More Valuable Than Washington Thinks, Washington Should Fund More Potential Science Miracles)
- American Institute of Physics (AIP): Maintains a federal science budget tracker; publishes research and articles (e.g. Proposed NASA Budget Would Gut Space Science, Jobs)
- American Cancer Society Cancer Action Network (ACS CAN): advocates for increased NIH and National Cancer Institute funding; develops reports, white papers, testimony, fact sheets, and other commentary on R&D funding.
Grant-making and program execution
→ See also our full guides on R&D funding agencies linked in the table below.
Once Congress sets agency budgets, federal departments and offices design and execute R&D programs, translating high-level funding priorities into concrete investments in labs, projects, and researchers. These programs define how they will support research, distribute funding, and measure progress.
To distribute these funds, agencies issue solicitations27—formal calls for research proposals that define goals, eligibility, timelines, and evaluation criteria. Some are broad and open-ended (e.g. DARPA’s AI Exploration Opportunities, AI Cyber Challenge), while others target specific challenges (e.g. NIH research on nanotechnology cancer interventions).
While PMs manage federal R&D programs, leadership and support teams also shape R&D funding processes at each major R&D agency. For example:
- NSF’s National Science Board approves new programs and establishes agency policies, while directorate and division leadership design most funding programs.
- ARPAs have specialized teams to help PMs and performers translate breakthrough research into real-world applications (e.g. DARPA’s Transition & Commercialization Support Program, and ARPA-E’s Tech to Market Advisors).
| Agency | Mission | Key emerging technology R&D areas | Major R&D subagencies/offices | Notable initiatives or programs |
| DOD | Support national defense through advanced technology development and military capability enhancement. | Autonomous weapons and vehicles, biotechnology, biosurveillance, cybersecurity, | DARPA, Military Service Research Labs, Defense Innovation Unit (DIU) | AI Forward, NGMM, AIxCC, SCEPTER, DARPA BTO Bio R&D |
| HHS | Enhance and protect health and well-being through biomedical, public health, and social services research. | Emerging infectious diseases, AI-supported drug discovery and healthcare delivery, biosurveillance systems and preparedness | National Institutes of Health (NIH), ARPA-H, Biomedical Advanced Research and Development Authority (BARDA) | PRECISE-AI, APECx, BREATHE, BARDA COVID-19 Vaccine Support |
| DOE | Advance energy technologies, ensure national energy security, and support basic and applied scientific research. | AI for energy optimization, nuclear energy, quantum, computing research, biosecurity | Office of Science, ARPA-E, National Labs, National Nuclear Security Administration (NNSA) | GEMINA, DIFFERENTIATE, ECOSynBio, Loan Programs Office |
| NASA | Conduct civilian space and aeronautics R&D to expand scientific understanding and space exploration capabilities. | AI for autonomous systems and space exploration, advanced materials, bioastronautics | Science Mission Directorate (SMD), Human Exploration and Operations Mission Directorate | International Space Station (ISS) R&D, Artemis Program, AI in Autonomy, AI in Earth Sciences |
| NSF | Promote the progress of science and engineering across disciplines, supporting basic research and STEM education. | Fundamental and applied AI, quantum computing, advanced materials, STEM education | CISE, Engineering Directorate, TIP Directorate | AI Research Institutes, CHIPS Act Funding |
| USDA | Support agricultural innovation to enhance food safety, sustainability, and rural community well-being. | Synthetic biology, biosecurity, AI in agriculture, climate-resilient crops | Agricultural Research Service (ARS), National Institute of Food and Agriculture (NIFA) | ARS Biomanufacturing, ARS Pest Management, NIFA AI and Biosecurity Grants |
| DOC | Promote US innovation and economic competitiveness through standards, technology, and climate and ocean research. | AI, cybersecurity, biotechnology, climate modeling, quantum, semiconductor production | National Institute of Standards and Technology (NIST), National Oceanic and Atmospheric Administration (NOAA) | NIST AI Risk Measurement Framework, CHIPS for America, NOAA Climate Models |
Conducting the actual R&D
→ See also our full guide on national labs and FFRDCs.
“Performers” are the institutions carrying out the research funded by government agencies—universities, companies, national laboratories, and other entities that receive and execute R&D contracts and grants.
“Investigators” are the individual researchers who lead or conduct the scientific work within these performing organizations. The “Principal Investigator” (PI) is typically the lead scientist with primary responsibility for the technical and administrative aspects of a research project, including managing the research team, ensuring compliance with federal requirements, and serving as the main point of contact with the funding agency.
The chart and table below cover the main performers in more detail:

Federal R&D funding supports both:
- Intramural R&D, conducted in government-owned laboratories (“federal laboratories”) by in-house or contractor scientists; and
- Extramural R&D, conducted by external organizations (universities, companies, or nonprofits) through grants or other funding mechanisms.
Intramural R&D can be further split into two categories:
- Government-owned, government-operated (GOCO) labs are owned or leased by the federal government and staffed by federal employees.
- Government-owned, contractor-operated (GOCO) labs are owned and equipped by the federal government but operated under contract by for-profit companies, nonprofit companies, and universities, and their staff are not considered federal employees.
GOGO and GOCO classifications determine the legal mechanisms available to these labs for managing and transferring their innovations—for example, both types can patent and license innovations, but only GOCO labs are eligible to claim copyright protection for software products.
The landscape of federally funded R&D performers is complex, and in practice, the distinctions between categories aren’t always applied consistently. While the classifications below follow formal definitions from US Code, many practitioners and policymakers use these terms more loosely or interchangeably depending on context.
| Performer type | Classification | Description | Examples |
| Federal agency in-house labs | Intramural (all GOGO) | Operated entirely by federal employees to support the missions of their agencies. | NIH Intramural Research Program, NIST labs |
| National laboratories | Intramural (mostly GOCO) | Formally refers to DOE’s 17 national labs. 16 of these are GOCOs; only one (the National Energy Technology Laboratory) is GOGO. Other agencies also have major GOCO labs (which are sometimes colloquially referred to as national labs) but only DOE’s labs carry the formal National Laboratory designation in US code. | Oak Ridge, Lawrence Livermore |
| Federally Funded Research & Development Centers (FFRDCs) | Intramural (all GOCO)28 | Specialized long-term research centers that are federally funded and contractor-operated (i.e. managed by nonprofits or universities and staffed by external researchers). FFRDCs complement agency capacity, support long-term technical needs (often with specialized data/facilities) and don’t compete commercially for federal R&D contracts. Federal agencies sponsor 42 FFRDCs in total, including the 16 GOCO national labs. | NASA’s Jet Propulsion Lab (NASA-owned, Caltech-operated), National Radio Astronomy Observatory (NSF-owned, AUI-operated) |
| Universities | Extramural | Receive competitive grants or cooperative agreements to perform research aligned with federal priorities. Major recipients of basic science funding. | John Hopkins, U. Michigan, U. Washington |
| University Affiliated Research Centers (UARCs) | Extramural | Nonprofit, university-affiliated research centers that provide engineering and technology capabilities to DOD. As of FY 2021, 14 universities had a UARC. | Johns Hopkins University Applied Physics Laboratory, University of Nebraska National Strategic Research Institute |
| Private companies | Extramural | For-profit companies that conduct R&D under federal funding agreements. Industry performers receive R&D contracts, cooperative agreements, or other transaction agreements especially in areas like defense, aerospace, energy, and health (e.g. DOD weapons development, NASA spacecraft, NIH pharmaceutical research). | Lockheed Martin, Booz Allen Hamilton, Moderna, IBM |
| Nonprofits and independent research institutes | Extramural | Perform policy-relevant or technical R&D, often funded by a mix of federal, philanthropic, and commercial sources. Some nonprofits operate FFRDCs or national labs under federal contracts (see examples). | RAND Corporation29 (operates 4 FFRDCs), Battelle Memorial Institute30 (operates 8 national labs), Broad Institute (includes MIT & Harvard researchers) |
Coordination
Given the vast scale and fragmentation of the federal R&D enterprise, executive coordination and advisory bodies help align cross-cutting priorities, implement multi-agency initiatives, and monitor progress. These are particularly important for coordinating multi-agency R&D programs (e.g. CHIPS Act) or implementing national strategies (e.g. for Advanced Manufacturing, Biodefense, AI). The same White House bodies that shape budgets and high-level policy also serve ongoing coordination functions, overseeing and synchronizing R&D program implementation across the federal government.
- Office of Science and Technology Policy (OSTP): OSTP leads cross-agency S&T strategy, co-develops the annual R&D priorities memo with OMB, and oversees implementation of multi-agency initiatives. It frequently convenes interagency working groups—for example, to align federal AI R&D following President Biden’s Executive Order on AI or to coordinate the bioeconomy strategy launched in 2022.
- Office of Management and Budget (OMB): Beyond budget-setting, OMB shapes how agencies implement R&D programs through management oversight, regulatory review, and procurement policy. OMB’s Office of Information and Regulatory Affairs (OIRA) reviews major regulations made by agencies, including those governing R&D processes. OMB’s management offices help coordinate R&D-related IT systems, performance tracking, and agency procurement, including AI acquisition policies across agencies.
- National Science and Technology Council (NSTC): Chaired by the president and managed by OSTP, NSTC organizes interagency committees and working groups that align federal S&T efforts, including on government-wide R&D initiatives.
- President’s Council of Advisors on Science and Technology (PCAST): An external advisory group of scientists, engineers, industry leaders, and policy experts who provide independent guidance to the president on S&T policy, including long-term R&D strategy and national competitiveness.
Other Executive Office of the President (EOP) offices can also play coordinating roles when initiatives fall under their purview, including specialized offices like the Office of the National Cyber Director (ONCD) and the National Space Council (NSpC) and higher-level coordinating bodies like NSC.
Oversight
Multiple entities monitor federal R&D programs to ensure accountability, effectiveness, and alignment with national priorities, including:
- Congress: Exercises oversight through hearings, reporting requirements, and investigations. Authorizing and appropriations committees may request progress reports on funded programs or require specific deliverables from agencies.
- Office of Management and Budget (OMB): Beyond budget-setting, OMB monitors program execution and ensures compliance with administration priorities. It can direct agencies to modify, delay, or terminate underperforming programs and sets performance benchmarks through its management offices. OMB also develops and reviews executive orders affecting R&D programs, then issues detailed implementation guidance to agencies through follow-up memoranda.
- Inspectors General (IGs): Each major R&D agency has an IG office that conducts independent audits and investigations of agency operations, fraud prevention, and compliance with federal regulations (e.g. NSF IG office).
- External groups: Think tanks, universities, advocacy nonprofits, and journalists also evaluate federal R&D programs by tracking spending and historical trends, publishing assessments and forecasting impacts, and highlighting gaps or inefficiencies. These efforts often shape public understanding and inform congressional or executive oversight.
Working on R&D funding: types of roles and career opportunities
The table below outlines the core types of R&D funding roles, including common backgrounds, day-to-day responsibilities, and resources for finding early-career opportunities and full-time positions.
| Type of role | Responsibilities | Typical background (for full-time roles)31 | Security clearance | Location | Career guides & opportunities |
| Congressional staff | Analyze and advance legislation and/or the federal budget; conduct hearings; engage with think tanks, advocacy groups, and other stakeholders | BA for junior roles; BA/MA/JD for mid-career/senior roles; strong communication skills32 | Rarely required (e.g. some Armed Services/Intelligence committee staff). | Washington, DC | Working in Congress (+ internships, fellowships, & full-time roles) |
| Think tank researchers or advocates | Conduct policy research and analysis; develop recommendations; advocate for policy changes; engage with policymakers and media | BA or MA for junior roles; MA/JD/PhD for mid-career/senior; subject matter expertise; experience in policy analysis or communications | Rarely required | Primarily Washington, DC; some in major cities or remote | Working in think tanks (+ fellowships, think tanks working on emerging tech policy, & resources)See also R&D-relevant think tanks above. |
| Program managers (and other R&D agency staff) | Design and manage funding programs; oversee peer review; monitor research progress; interface with research community | PhD or extensive technical experience; prior research or industry experience; science policy, program management, and grantmaking familiarity | Sometimes required (especially DOD or intelligence-related roles) | Washington, DC; some agency field offices across the US (e.g. NIH research campuses) | ARPAs, DOD (+ OSD and the military departments), HHS (primarily NIH), DOE, NSF, USDA, DOC. See also executive branch fellowships, federal job application advice, and resources |
| National lab & FFRDC staff | Manage research centers and projects; advise agencies; translate policy into R&D programs; participate in strategic planning | Advanced STEM degrees; experience managing technical teams; applied research or government contracting experience | Often required, depending on lab or role33 | Across the US (e.g. Los Alamos, Oak Ridge) | National labs and FFRDCs guide |
| Government contractors (industry/university) | Execute government-funded R&D; manage project deliverables; liaise with PMs; support commercialization or tech transition | STEM + applied research/consulting; project management | Varies widely by project34 | Across the US, often near federal labs or agencies | See job postings on ClearedJobs.Net or ClearanceJobs35 |
| OSTP and OMB staff | Coordinate interagency S&T strategy (OSTP); evaluate budgets and ensure alignment with administration goals (OMB) | MA/JD/PhD depending on role; fellowship or federal agency experience; relevant background (e.g. economics for OMB, STEM for OSTP) | Typically required | Washington, DC | OSTP, OMB, EOP, and executive branch fellowships |
Preparing for R&D funding roles
While requisite skills and experience vary widely across R&D-related roles (e.g. in Congress vs. in a national lab), two qualifications stand out as broadly valuable: subject-matter expertise and familiarity with R&D funding processes. To prepare for federal R&D funding roles, consider:
- Participating in early-career programs: If you’re a student or early-career, try to participate in related programs: e.g. intern at a national lab, apply for agency scholarship programs (e.g. DOD SMART scholarships, DOE student experience program), or join competitions like Hackathons or Grand Challenges run by R&D agencies.
- Complete an S&T policy internship or fellowship (e.g. AAAS’ S&T Policy Fellowship). See opportunities for specific agencies and organizations linked above.
- Engaging with R&D agencies: Agencies like NSF, NIH, DOE, and DARPA often host Proposers’ Days, workshops, or webinars to announce open funding opportunities and interact with prospective grantees. These public events let you observe how program managers frame problems and engage potential grantees. Reviewing past funding calls, challenge pages, or prize competitions can also help you understand what different agencies prioritize and how they communicate those goals.
- Understanding budget and grantmaking processes: Learn the basics of the federal budgeting process, including the roles of OMB, Congress, and federal agencies, and familiarize yourself with funding mechanisms and processes. Some agencies host primers or online webinars explaining their funding processes (e.g. NIH events).
- Networking with R&D professionals: Reach out to current and former R&D staff at your institutions of interest for informational interviews. These conversations can help you navigate the hiring process, clarify your fit, and gain valuable professional connections. If you’re able, consider attending events like the ARPA-E Summit, AAAS Annual Meeting, or NSF PI meetings to expand your network.
- Publishing research or policy articles: Demonstrate technical credibility through peer-reviewed publications, conference talks, or patents. If you’re a student or early-career, consider co-authoring research with a professor or publishing a science policy article in a news outlet.
- Gaining subject-matter expertise: Many R&D roles expect strong technical depth—graduate degrees (often STEM PhDs) are common at federal R&D agencies, OSTP, and other organizations with close R&D program involvement.
- Starting as a performer: Interning or working full-time on a federally funded project at a university, nonprofit, or national lab can familiarize you with writing or managing grant applications, understanding award cycles, and navigating compliance and reporting requirements. Performer-side work can also serve as a valuable stepping stone to government employment. If you’re a student, see if your university has federally-funded research by searching “[your university] + [federal agency] grant” (e.g. “UW Madison DOE grant”). If so, see if you could serve as a research assistant for a professor leading the project.
- Participate in mid-career “accelerator” programs: Several programs provide training, networking opportunities, and mentorship for mid-career professionals interested in leading R&D programs, including the Big If True Science (BiTS) Accelerator and the Brains Accelerator.
Appendices: Day-in-the-life & a brief history of federal R&D funding
Day in the life: Stories from people working on federal R&D funding
The following excerpts are pulled from interviews with people working on federal R&D funding.
Former OSTP Principal Deputy Director Kei Koizumi describes setting R&D funding priorities:
OSTP has a fairly small budget. I tell people, we don’t give out research funding, and we don’t have any labs, but we do help to set the direction for federal research funding, and that’s a lot of money.
That’s a lot of leverage and power, and shaping that research funding helps shape the direction of research throughout the United States, and indeed the world, because the world does look to “What does the US think is important?” as a clue to “Maybe my nation should be thinking about that as an important topic as well.”
Former OSTP Deputy Director for Policy describes his collaborative approach to R&D funding:
I was the principal White House advocate for the National Nanotechnology Initiative…and for an initiative to increase funding for long-term information technology R&D. During my time at the NEC, I learned the importance of developing relationships with people both inside and outside the government, and of serving as a “force multiplier” for their work. …
[T]he ability to identify who needs to do what to achieve their goals…is particularly important for White House staff, given that most of what they accomplish will be implemented by someone else. For example, an OSTP staffer working on a national research initiative did not have a research lab in the White House, nor did they award grants and contracts to scientists. It usually meant they had persuaded the president to include funding for that research initiative in his budget, that Congress had approved the funding, and that designated agencies then used the funds to pursue the particular research goals.
House Science Committee staffer Brent Blevins describes working on the 2024 NASA reauthorization bill:
One of the ways that Congress asserts its oversight role is by writing authorization legislation. That’s where we provide policy direction, where we tell NASA, “Okay, you’re going to do a scientific mission to this planet in the solar system,” “You’re going to investigate this earthbound phenomenon,” “You’re going to send astronauts to the Moon and then Mars.” …
I meet a lot with stakeholders. I think sometimes people imagine that, if they have a negative stereotype of Congress or what people do, it’s all these lobbyists wearing three-piece suits and that sort of thing. And that’s really not the case at all. We meet with a lot of STEM advocates, university faculty. We meet with just a wide range of people. And they come to talk to us. Sometimes it’s just a brief about the research they’re doing. Sometimes it’s to advocate for something in a NASA authorization bill.
Former DARPA PM Joshua Elliott describes managing DARPA R&D programs:
Once the program is created, we have a very actively managed model. There’s a kickoff meeting when the program starts; everybody gets together over several days. Then we have in-person meetings with all of the principals in the program. Sometimes that’s as many as 200 people coming to these meetings every six months, which is a very aggressive cycle.
We’re having working group calls five times a week. The program managers are deeply engaged, often traveling around the country doing site visits, where they spend an entire day digging into the details of what every performer is doing. It’s a very active management approach to innovation.
Find more stories of people working on R&D funding on Statecraft and the Issues podcast.
Federal R&D funding: A brief history
Today, the US hosts the world’s largest and most successful R&D system—but this wasn’t always the case. Before World War II, the US lagged behind Europe in scientific research and innovation, targeting only direct government needs like land exploration. In 1940, the federal government contributed less than $70 million to R&D—just 1% of what it spends today when adjusted for inflation.
WWII triggered a massive expansion: federal R&D funding surged tenfold, and the government pioneered new models for partnering with universities and industry, mobilizing academic research at scale to address national defense problems from within their home institutions. The war also introduced the use of R&D contracts—flexible funding mechanisms designed to support research whose precise approach and outcome couldn’t always be specified in advance.36 R&D contracts allowed the government to pay not only for direct research costs but also overhead expenses—a key enabler for long-term collaboration with non-governmental organizations.
This wartime transformation laid the foundation for a permanent federal role in R&D. In 1945, Vannevar Bush’s report to the president Science—The Endless Frontier argued for sustained public investments in science, leading to the NSF’s creation in 1950 and establishing the federal government as the primary funder of basic research. Other agencies also emerged to support a range of research domains: NIH in biomedical research, the Office of Naval Research (ONR) in physical sciences, and the Atomic Energy Commission in nuclear research. Federal funding would grow from $5.5 billion in 1947 to $71.4 billion by 1998 (in 1998 dollars).
By 1950, the NIH’s annual budget had grown to over $50 million, from under $3 million at the end of the war. This growth accelerated further in the late 1950s, driven by scientific breakthroughs and advocacy for disease-focused research.
The launch of Sputnik in 1957 fueled a massive increase in funding for space and defense research, including the creation of NASA and the Advanced Research Projects Agency (ARPA, later DARPA). Federal R&D spending and investment in STEM education rose at double-digit rates through the 1960s. Energy shortages and environmentalism prompted the creation of DOE in the 1970s and expanded R&D in areas like clean energy, environmental monitoring, and conservation technologies.
As federal R&D funding grew, a host of complementary tax incentives and legal reforms emerged to spur additional private sector investment and accelerate the commercialization of publicly funded discoveries. Since 1954, companies have been able to deduct R&D costs from taxable income, and the Economic Recovery Tax Act of 1981 introduced a special R&D tax credit for companies that increased their R&D spending beyond a baseline. The Stevenson-Wydler Act of 1980 and the creation of cooperative research and development agreements (CRADAs) opened federal labs to private partnerships, further blurring the lines between public and private R&D.
In the 1980s, renewed concerns about US economic competitiveness spurred another shift in federal R&D strategy: programs like the Small Business Innovation Research (SBIR), NSF’s Engineering Research Centers, and the Department of Commerce’s Advanced Technology Program encouraged closer collaboration among government, academia, and industry. Congress also passed the Bayh-Dole Act, allowing universities and small businesses to retain ownership of inventions developed with federal funding—an important catalyst for commercial innovation in biotech, computing, and other industries.
Throughout the 1990s and 2000s, federal R&D investment continued to support both national missions and emerging technologies. The Human Genome Project, launched in 1990 and funded primarily by NIH and DOE, marked a milestone in coordinated federal science, accelerating advances in genetics and biotech. The 2000s saw growing emphasis on dual-use and homeland security technologies following 9/11, including expanded funding for biosecurity and cyber defense. DARPA and NSF backed foundational research in computing and networking that laid the groundwork for breakthroughs in AI and data science. Federal support for university-based research continued supporting generations of scientists and engineers, creating effective talent pipelines for technology transfer.
In response to COVID-19, the federal government launched Operation Warp Speed to accelerate vaccine development, demonstrating the power of rapid, coordinated R&D investment. The bipartisan CHIPS and Science Act of 2022 committed over $50 billion to boost semiconductor R&D and manufacturing capacity, and federal agencies have launched major initiatives in AI, quantum computing, advanced manufacturing, and biosecurity.
Further reading
- Federal R&D Funding: FY2025, Congressional Research Service (2024)
- National Patterns of R&D Resources, National Center for Science and Engineering Statistics
- Historical trends in federal R&D, American Association for the Advancement of Science (AAAS)
- How to Invest Federal Funds Like a VC, Statecraft (2024)
- Federal R&D Funding: The Bedrock of National Innovation, Science Policy Review (2020)
- The rise and fall of the industrial R&D lab, Ben Southwood (2020)
- AAAS R&D Budget Primer, AAAS (2019)
- GPS, lithium batteries, the internet, cellular technology, airbags: A Q&A about how governments often fuel innovation, Liz Jacobs (2013)
- Transforming Biomedical Research in the 21st Century, National Research Council (2011)
- The Science of Science Policy, Kaye Husbands Fealing et al. (2011)
- Beyond Sputnik: U.S. Science Policy in the 21st Century, Homer A. Neal et al. (2008)
- Funding a Revolution: Government Support for Computing Research, National Research Council (1999)
- Federally Funded Research: Decisions for a Decade, Office of Technology Assessment (1991)
Related articles
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Footnotes
- In R&D, “high-risk” refers to work with a significant chance of failure or high uncertainty in outcome—not that the research is physically dangerous or poses a safety risk. ↩︎
- For example, antibiotic-resistant infections pose a major global health threat that private pharmaceutical companies lack strong economic incentives to address. Unlike drugs for chronic conditions, antibiotics are taken only briefly, face competition from low-cost generics, and are often held in reserve for emergencies, further limiting sales. Even successful antibiotics may quickly become obsolete as resistance develops. Federal R&D invests in areas like this, spurring markets to produce public goods where they would otherwise undersupply. ↩︎
- In biotechnology, for example, commercially profitable production often requires large-scale, high-capital investments over extended production timelines. Federal programs like SBIR/STTR grants and the DOD’s Office of Strategic Capital provide funding for biotechnologies at crucial development stages. ↩︎
- Pasteur’s Quadrant is another useful way to conceptualize types of research. It distinguishes between three categories:
Pure basic research, which seeks fundamental understanding without real-world application (e.g. Neils Bohr’s work on atomic structure; common at NSF).
Pure applied research, which aims to solve specific practical problems without advancing underlying science (e.g. Thomas Edison’s work on electric lighting; often pursued by DARPA).
Use-inspired research, which pursues both fundamental understanding and applied outcomes (e.g. Louis Pasteur’s germ theory work; common at NIH and DOE). ↩︎ - Technologies are often transferred to other agencies when the original R&D funder is not the entity responsible for deploying the technology operationally. For example, DARPA (a Defense Department R&D agency) may develop an advanced drone prototype that is later transitioned to the Air Force for procurement and use. Similarly, disease surveillance tools funded by the National Institutes of Health (NIH) may be handed off to the Centers for Disease Control and Prevention (CDC) for integration into national public health systems. ↩︎
- These categories aren’t formal or mutually exclusive—some programs blend elements of multiple models, and agencies may operate across several at once. ↩︎
- These researchers can be either external investigators at universities and other institutions (who apply for competitive grants) or government-employed scientists working within agencies’ own labs and research facilities (such as NIH’s intramural program or national labs). ↩︎
- A related mechanism is the FDA’s Priority Review Voucher (PRV) program, which awards tradable vouchers for expedited regulatory review rather than cash prizes. Companies developing treatments for neglected diseases receive vouchers that can be sold to other companies seeking faster FDA review, creating market-based financial incentives without direct government spending. ↩︎
- While the US did not contribute directly to the 2009 Gavi Advance Market Commitment (AMC) for pneumococcal vaccines, it has been a major funder of Gavi overall. US contributions to Gavi’s core budget have indirectly supported pneumococcal vaccine rollout, alongside other immunization programs in low-income countries. ↩︎
- Milestone-based funding—structuring awards so that funding is released incrementally as recipients meet predefined technical goals—is not technically a “funding mechanism.” Rather, it is an approach used within mechanisms like contracts, cooperative agreements, and OTAs, especially in high-risk, high-accountability programs such as those run by BARDA, DARPA, and ARPA-H. ↩︎
- DARPA was originally established as the Advanced Research Projects Agency (ARPA) in 1958 following the launch of Sputnik. The agency was renamed the Defense Advanced Research Projects Agency (DARPA) in 1972 to emphasize its defense mission. ↩︎
- As of 2025, autonomous taxis account for more than one in four rideshare trips in San Francisco. ↩︎
- The bill also includes expanded R&D tax credits, $10 billion for Mars-related programs at NASA, and a proposed tiered system for taxing large university endowments. ↩︎
- Program managers go by different titles across agencies. For example, NSF uses “Program Officer” or “Program Director,” NIH uses “Program Officer” or “Scientific Review Officer,” DOE uses “Program Manager” or “Technology Manager,” NASA uses “Program Scientist” or “Program Executive,” and DARPA uses “Program Manager.” ↩︎
- At NSF and other traditional funding agencies, external peer review—conducted by independent scientists and engineers from universities, industry, and other research institutions—evaluates the scientific merit of proposals before program officers make funding recommendations. Program officers select reviewers and may convene review panels, but the technical evaluation is performed by external experts rather than agency staff. This contrasts with ARPA agencies, where PMs have greater direct authority over project selection and typically rely more on their own technical judgment and strategic vision. ↩︎
- A single DARPA PM might oversee over $100 million in active funding at a time across multiple projects, with wide latitude to select research performers, set technical milestones, and adjust priorities as projects evolve. PMs can collectively oversee billions in funding decisions over the course of their career. ↩︎
- Certain limitations of R&D funding, like its higher risk of failure and extended time horizons, are precisely what position it to address private sector gaps. These characteristics are not inherently disadvantages of R&D funding, but structural tradeoffs that enable core parts of its value as a policy tool. ↩︎
- Some have argued that governments should retain a greater stake in the companies they help create through early-stage R&D funding (e.g. Tesla and Moderna). Proposals have included equity stakes, royalty agreements, or public-interest conditions to ensure that public investments yield long-term societal returns and are not fully privatized. ↩︎
- One metric of R&D funding over time—federal R&D intensity, or the share of GDP spent on federal research and development—has declined from 1.86% in 1986 to 0.62% in 2017, suggesting a shift in the relative scale of federal investment over the past several decades. ↩︎
- Technically, both OMB and OSTP are part of the broader Executive Office of the President (EOP), but are commonly referred to as part of the White House. ↩︎
- The President’s annual R&D budget summary includes a total amount requested to support R&D across all federal agencies, but it does not result from a single, comprehensive strategy. Rather, it aggregates individual agency requests negotiated with OMB and the White House. ↩︎
- In addition to standing authorizing and appropriations committees, Congress occasionally establishes special commissions or advisory bodies to explore strategic science and technology issues. While these commissions do not have funding authority, they can significantly influence legislation and appropriations by setting national agendas, informing hearings, and proposing institutional reforms. Two prominent recent examples are the National Security Commission on Artificial Intelligence (NSCAI) and the National Security Commission on Emerging Biotechnology (NSCEB), both of which issued congressionally mandated reports with recommendations that helped shape provisions in the CHIPS and Science Act, biosecurity initiatives, and defense R&D priorities. ↩︎
- Congress provides R&D appropriations through 9 of the 12 regular appropriations bills. These are:
1. Defense
2. Labor, Health and Human Services, Education, and Related Agencies
3. Interior, Environment, and Related Agencies
4. Energy and Water Development
5. Commerce, Justice, Science, and Related Agencies
6. Agriculture, Rural Development, Food and Drug Administration, and Related Agencies
7. Military Construction, Veterans Affairs, and Related Agencies
8. Transportation, Housing and Urban Development, and Related Agencies
9. Homeland Security ↩︎ - Primarily the National Institutes of Health (NIH) ↩︎
- To establish an operational agency, Congress must pass both authorizing legislation and funding. For example, the Agricultural Advanced Research and Development Authority (AgARDA) was authorized in the 2018 Farm Bill to support high-risk agricultural innovation but never launched at scale due to insufficient sustained funding. ↩︎
- The National Academies of Sciences, Engineering, and Medicine are independent, nonprofit institutions chartered by Congress to provide expert advice to the federal government. They frequently conduct R&D-related studies sponsored by federal agencies and produce expert peer-reviewed reports that often serve as definitive guidance on complex S&T issues. ↩︎
- Federal agencies issue funding opportunities under various names, including Broad Agency Announcements (BAAs), Requests for Proposals (RFPs), Funding Opportunity Announcements (FOAs), and Notices of Funding Opportunity (NOFOs). The specific term used depends on the agency and funding mechanism, but all serve as formal solicitations outlining the goals, eligibility, deadlines, and submission requirements for prospective applicants. ↩︎
- Under 2024 updated federal guidance, research done at FFRDCs is now counted as intramural R&D, even though they are run by outside contractors like universities, nonprofits, or private companies. This reflects the fact that FFRDCs are government-owned, fully funded by federal agencies, and closely tied to agency missions. In the Survey of Federal Funds for Research and Development, agencies are now told to include funding to FFRDCs in their intramural R&D totals. ↩︎
- RAND Corporation operates multiple FFRDCs including the National Defense Research Institute and Project AIR FORCE. ↩︎
- Battelle Memorial Institute is a nonprofit that manages several DOE labs, which themselves operate as FFRDCs. ↩︎
- Most of these institutions offer internships to students and early-career professionals without the below credentials (see career resources below). ↩︎
- Congress is generally less credentialist than think tanks and the executive branch. While graduate degrees in public policy, law, or a technical field are valuable for mid- to senior roles, they’re rarely required. Prior congressional experience matters far more than formal credentials—senior roles rarely get filled by people without prior Hill experience. Fellowships can allow early- to mid-career professionals to bypass this typical requirement and move directly into substantive policy roles. ↩︎
- Interning or working at national labs or for government contractors can be an excellent pathway to obtaining a security clearance, which significantly enhances your competitiveness for many government roles. Many labs and contractors will sponsor clearance applications for employees working on classified projects, and having an active clearance removes a major hiring barrier for agencies like DOD, DOE, and intelligence community organizations. ↩︎
- Unclassified research typically requires no clearance, while projects involving sensitive technologies (e.g. cybersecurity, defense systems, aerospace) often require Secret clearance. Top Secret clearances are needed for highly classified defense research. Even within the same agency, clearance requirements can vary significantly based on the specific contract, data access needs, and whether the work involves classified facilities or information. ↩︎
- Most agencies publish lists of their contractors (e.g. DOD, DARPA, DOE)—but be sure to research individual companies, as not all contracting firms conduct R&D (most provide specific services like distribution). The US General Services Administration publishes annual lists of the top 100 largest contractors by federal spending, and GovCon Wire publishes government contracting news. You can also explore postings on ClearedJobs.Net or ClearanceJobs, job boards of government contracting positions requiring security clearances. Even if you don’t currently have a security clearance, job boards like this can be helpful for searching government contracting firms. ↩︎
- R&D contracts allowed the government to pay not only for direct research costs but also overhead expenses—a key enabler for long-term collaboration with non-governmental organizations. ↩︎
