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1025 THOMAS JEFFERSON STREET. N.W.
SUITE 400 EAST
WASHINGTON. D.C. 20007-0805
(202) 965-8100
TELECOPIER: (202) 965-8104
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777 BRICKELL AVENUE. SUITE 500
MIAMI, FLORIDA 33131-2803
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TELECOPIER: (305) 372-9928
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February 2, 1999
TO:
THE CITY OF MIAMI BEACH
@Ub ~L'V(~~
FROM:
Marilyn A. Berry Thompson
SUBJECT: RELEASE OF THE FY2000 ADMINISTRATION BUDGET
"
As you know, the President released his budget proposal for FY2000 yesterday. On your behalf,
we personally attended briefing sessions held by the individual Cabinet Members and agencies at
which each agency head outlined his or her major priorities and new initiatives, summarized
funding trends, program reductions and/or eliminations.
Enclosed you will find copies of those detailed budget proposals for the following agencies of
potential concern and interest to you:
o OFFICE OF MANAGEMENT BUDGET/ST A TE/LOCAL GOVERNMENT
OVERVIEW
o AGRICUL TURE
o COMMERCE: EDAlOTHER
o COMMERCE: NIST/NTIA
o EDUCATION
o ENERGY
o ENVIRONMENTAL PROTECTION AGENCY
o FEDERAL EMERGENCY MANAGEMENT ADMINISTRATION
o HHS: HUMAN SERVICES
o HHS:HEALTHANDNIH
o HOUSING AND URBAN DEVELOPMENT
o INTERIOR
o INSTITUTE FOR MUSEUM AND LIBRARY SCIENCES
o JUSTICE
o LABOR, EMPLOYMENT AND TRAINING
o NA TIONAL ENDOWMENT FOR THE ARTS/NA TIONAL ENDOWMENT
JORDEN BURT BOROS CICCHETTI BERENSON & JOHNSON LLP
AFPILIATED COUNSEL:
JONES ~ BWUCH LLP - WASHINGTON. D.C.
FLEMING ~ PHILLIPS - SAN FRANCISCO, CA
FOR THE HUMANITIES
o NOAA
o STATE/UNITED STATES INFORMATION AGENCY
o TRANSPORTATION
o TREASURY rr AX
o VETERANS
OBJECTIVESfNEXT STEPS:
We wanted to provide you with copies of the actual budget summaries just as quickly as
possible, so that you could begin to analyze them for their impact, as well as for their potential
for new, incremental sources of support.
More detailed summaries will be provided to you within the next week.
We hope that you will utilize these materials, however:
"
o As guidance for your more immediate budget and programmatic development
needs;
o As a basis for providing us and your Congressional Delegation with feedback on
those matters of primary concern or interest to you;
o As a basis for formulating your overall FY2000 federal funding plans and
federal government relations activities.
We also seek from you:
o Preliminary information as to the impact of these initiatives on your institution
o A list of questions/issues that you need or want researched in more detail
· TECHNOLOGY ADMINISTRATION BUDGET HIGHliGHTS
Technology Administration
Budget Highlights
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More than ever before, technological
leadership is vital to the national interest
of the United States. The nation's capa-
bility to harness the power and promise
of leading-edge technologies will deter-
mine, in large measure, its prosperity,
security, and global influence in the 21 st
century.
Leading economists estimate that
technology accounts for as much as 50
percent of the nation's long-term eco-
nomic growth. The study Technology,
Economic Growth, and Employment:
New Research from the Department of
Commerce found that firms using
advanced technologies are significantly
more productive, pay higher wages,
offer more secure jobs, and increase
employment more rapidly than those
that do not. But global competition is
intensifying. Nations everywhere have
recognized the link between technology
and growth and are developing policies
and programs to enhance industrial
competitiveness and fuel technology-
driven growth and job creation.
The Clinton Administration has
sought to address these economic and
competitive realities by developing, in
partnership with American industry, poli-
cies and programs that enhance U.S.
competitiveness in the global market-
place and maximize technology's contri-
bution to national economic growth, job
creation, and quality of life. The focal
point for these efforts is the Technology
Administration (TAl, the primary civilian
technology agency working with industry
to improve U.S. competitiveness. TA
serves as an advocate for U.S. innova-
tion and industrial competitiveness with-
in the Department of Commerce, other
federal agencies, and national and
international fora. It carries out this role
through:
. the leadership of the Under
Secreta ry;
. the Office of Technology
Policy's analysis, formulation, and advo-
cacy of policies that maximize the contri-
bution of technology to economic
growth;
. the programs of the National
Institute of Standards and Technology,
which maintain and improve the nation's
measurement and standards infrastruc-
ture; foster the development, adoption,
and diffusion of new technologies; and
facilitate the adoption of leading busi-
ness practices; and
. the collection and dissemina-
tion of technological information by the
National Technical Information Service.
To continue the successful imple-
mentation of this civilian technology
agenda in fiscal year (FY) 2000, the
President requests:
FY 2000
Office of the Under
Secretary/Office of
Technology Policy
Total funding requested: $9 million
National Institute of
Standards and
Technology
Total funding requested: $735 million
National Technical
Information Service
Total funding requested: $2 million
Specific budget proposals are
described on the following pages.
u.s. Department
of Commerce
February 1999
US/OTP BUDGET HIGHLIGHTS
SUMMARY AND
JUSTIFICATION
President Clinton requests $9 million
for the Office of the Under Secretary
for Technology and the Office of
Technology Policy (US/OTP). This
request supports US/OTP's mission and
fundions necessary to meet critical
Administration and Congressional civil-
ian technology priorities. US/OTP is
responsible for working with the private
sedor to analyze, develop, coordinate,
and advocate national policies that
maximize technology's contribution to
U.S. competitiveness, economic growth,
the creation of high-wage jobs, and
improvements in living standards for all
Americans.
The request, an overall decrease of
$523,000 from the FY 1999 appropria-
tion, will support the Under Secretary in
overseeing the Technology Administra-
tion's three operating units (OTP, the
National Institute of Standards and
Technology, and the National Technical
Information Service), coordinating sever-
al interagency civilian technology efforts,
and providing analysis and leadership in
other important technology-related
domestic and international activities. The
US/aT? b'.,c!get also supports the Office
of Space Commercialization (OSC).
In FY 2000, US/OTP will continue
to provide leadership and analytical
activities-in close partnership with U,S.
industry, federal research agencies, and
the national laboratories-to maximize
taxpayers' return on their investment in
US/OTP
Budget Highlights
federal research and development
(R&D). The FY 2000 budget proposal
includes a $1 million increase to core
programs to enable US/OTP to:
. expand analysis and advocacy of
current and proposed economic, tech-
nology, and regulatory policies of the
federal and state governments and
research their impact on innovation and
U.S. competitiveness;
. build on successful efforts to help
the nation meet the rapidly growing
demand for information technology (IT)
workers; and
. build on existing programs to help
the automotive supplier base--and
states whose economies are linked
closely to the automotive sector-
seize the opportunities presented by the
rapid development of new automotive
technologies.
The proposal also requests a
decrease of $1 .7 million for the
Experimental Program to Stimulate
Competitive Technology (EPSCo T),
which is designed to foster the develop-
ment of indigenous technology assets in
states and regions traditionally under-
represented in federal R&D funding. No
new grants will be made in FY 2000;
instead, a full-scale evaluation of
EPSCo T will be undertaken.
US/OTP PERFORW,.'~CE
For more than 15 years, OTP (as well
as its predecessor, the Office of Produc-
tivity, Technology and Innovation) has
been an important voice for industry,
working with other federal agencies,
Congress, and international groups to
foster U.S. innovation and competitive-
ness. For example, as the competitive
environment has changed, US/OTP has
served as a forceful advocate for
improvements in the laws and regula-
tions governing the commercialization of
federal research, including removing
barriers to government-industry cooper-
ative research, ensuring effective protec-
tion of intellectual property, and expand-
ing small business access to the federal
research enterprise.
OTP's long track record of success
continued during the past year:
. In partnership with state and local
governments, US/OTP completed the
design of the EPSCo T grant process and
conduded a successful competition in
which seven proposals were selected to
receive a total of $1 .6 million.
. In the first seven months of 1998,
US/OTP's World Wide Web site received
more than 1.5 million "hits" during
more than 83,000 user sessions, and
users downloaded OTP reports more
than 53,000 times. Also in 1998,
US/OTP unveiled a new Web site, Go
for IT, dedicated to linking businesses,
current and prospective IT workers,
communities, educators, educational
and training institutions, and othe'-.
. US/OTP successfully led the
Interagency Committee on Technology
Transfer's formulation of a coordinated
2
. US/OTP BUDGET HIGHLIGHTS
Administration response to proposed
technology transfer legislation. The com-
mittee's ability to speak with a single
voice contributed substantially to the
House Technology Subcommittee's
adoption of most of the recommended
changes. In addition, the principal
industry witness testifying before the sub-
committee endorsed the majority of the
recommendations of the interagency
group, a testament to the group's cus-
tomer focus.
. OSC was instrumental in shaping
the President's commercial remote sens-
ing policy; the President's National
Space Transportation Policy; and space
launch trade agreements with Russia,
China, and currently the Ukraine.
OSC's policy work made substantial
contributions to the success of the com-
mercial remote sensing and Global
Positioning System industries, which are
projected to be worth $5 billion to
$15 billion by the turn of the century.
OSC also worked with the U.S. Trade
Representative on space launch trade
negotiations to protect U.S. interests in
the global marketplace.
US/OTP evaluates its performance
and plans its work through extensive
and ongoing consultation with public-
and private-sector stakeholders, output
tracking, and selected peer reviews.
With the exception of the Partnership for
a New Generation of Vehicles (PNGV),
these measures are direct and verifiable
counts of US/OTP staff activities, busi-
ness processes, and analytical output.
Peer review of the PNGV is conducted
by the National Research Council, which
has well-established procedures for
ensuring objective, thorough expert
reviews.
PROGRAM DESCRIPTIONS
The FY 2000 request supports the
Under Secretary's pc; - :'::,:..,-
Committee on Technology of the
President's National Science and
Technology Council. This committee,
which helps to establish clear national
goals for federal science and technology
investments and to ensure that federal
civilian R&D priorities reflect the require-
ments of industry customers, is coordi-
nating maior Administration R&D initia-
tives in materials, construction and
building, manufacturing infrastructure,
and electronics and automotive tech-
nologies. The FY 2000 budget also sup-
ports the international activities of the
Under Secretary as the principal U.S.
government representative for technol-
ogy in the U.S.-Japan Economic
Framework Talks, the U.S.-Egypt
Partnership for Economic Growth, the
U.S.-Israel Science and Technology
Commission, and the Presidential initia-
tive to support the peace process in
Northern Ireland.
In addition, the FY 2000 budget
supports the Under Secretary's role as
the chair of the high-level committee
overseeing the PNGV initiative, a part-
nership of seven federal agencies, 19
national laboratories, U.S. auto makers,
and more than 300 hundred suppliers
and universities. US/OTP's base
resources support the operations of the
PNGV Secretariat, which is responsible
for coordination of participating federal
agencies, liaison with USCAR (which
represents the auto industry in the part-
nership), and basic record keeping. The
PNGV initiative has made strong
progress toward achieving its R&D
goals, which were established in three
areas: advanced manufacturing meth-
ods; technologies leading to near-term
improvements in automobile efficiency,
safety, and emissions; and research
leading to vehicle prototypes offering a
threefold improvement in fuel efficiency.
The four key system areas considered
most promising have been selected, and
R&D efforts now are focused on hybrid-
electric vehicle drive systems, direct-
injection engines, fuel cells, and light-
weight materials.
Among other activities, the FY
2000 budget supports US/OTP's admin-
istration of the Nationcl\Aedal of
1::'':''~_;'"'lc,CJi;ji, rr,e i"":GT;O:-:.5 jjigne$i cwcrd
for technological achievement that helps
increase public understanding of the
essential role that technology plays in
the global economy. The budget also
supports the OSC's continued role in
the development of new national space
policies and in publishing information
on current business trends in commer-
cial space. In addition, it funds the
Commerce Science and Technology
Fellowship Program, which will place
approximately 20 senior government
technologists in other agencies to pro-
mote understanding of the scope of fed-
eral R&D and policy activities.
In FY 2000, US/OTP will manage
the Partnerships for a Competitive
Economy (PACE) initiative. Working with
state and local governments, business,
and academia, US/OTP conducts PACE
conferences around the country to
maintain a dialogue with the private
sector on how best to help companies
and workers compete and win in the
rapidly changing economy of the 21 st
century. US/OTP also will promote
technology-based economic develop-
ment through the U.S. Innovation
Partnership initiative, which seeks to
leverage the resources of U.S. industry;
academia; and federal, state, and local
governments and to create synergy
among complementary programs. In
addition, through its Meeting the
Challenge effort, US/OTP will analyze
the competitive status of U.S. firms in
several crucial U.S. industries. US/OTP
will publish reports on two additional
key industries in FY 2000, similar to
those previously done on the chemical,
steel, automobile, biotechnology, and
environmental technologies industries.
PROGRAM CHANGES
The President requests an additional
$1 million increase for US/OTP efforts
in three key areas. First, US/OTP will
expand its analysis and advocacy of cur-
rent and proposed federal and state
economic, technology, and regulatory
policies and its research on their impact
on innovation and U.S. competitiveness.
Second, US/OTP will continue its suc-
cessful efforts to helc the nation meet
the rapidiy growing demand for IT work-
ers. US/OTP will work closely with indus-
try, state and local governments, and
educational institutions at all levels to
develop innovative strategies and pro-
grams to educate and train American
workers for these high-quality, high-
wage jobs. Third, the rapid development
3
US/OTP BUDGET HIGHLIGHTS
and deployment of new automotive
technologies, together with the expected
introduction of new and reformulated
fuels, has the potential to revolutionize
the global auto industry. In FY 2000,
US/OTP will build on existing programs
within the Technology Administration to
help the automotive suppliers and auto-
producing states seize the opportunities
that emerge.
FY 2000 will be an evaluation year
for EPSCo T. The grant process was initi-
ated in FY 1998 by US/OTP in partner-
ship with state and local governments.
By FY 2000, EPSCoT will have conduct-
ed two grant competitions, and most of
the projects funded under the first com-
petition will be complete or nearing
completion. No grants will be made in
FY 2000. Instead, a full-scale evaluation
effort will assess the management, direc-
tion, and effectiveness of the program in
meeting its stated objectives, and exam-
ine current needs. Therefore the FY
2000 budget proposes a decrease of
$1. 7 million for EPSCo T.
4
. NIST BUDGET HIGHLIGHTS
SUMMARY
The Administration's fiscal year (FY)
2000 budget request to Congress
includes $735* million for the Tech-
nology Administration's National
Institute of Standards and Technology
(NIST), an increase of about
15 percent over its FY 1 999 budget of
$641 million.
The NIST FY 2000 budget request
is divided into three appropriations:
. $290 million for Scientific and
Technical Research and Services, includ-
ing $285 million for the Measurement
and Standards laboratories and $5 mil-
lion for the Baldrige National Quality
Program (BNQP);
. $339 million for extramural pro-
grams, including $239 million for the
Advanced Technology Program (ATP)
and $100 million for the Manufacturing
Extension Partnership (MEP); and
. $107 million for construction of
the Advanced Measurement laboratory
building and critical maintenance and
safety upgrades of NISI's existing
buildings.
NISI's four interrelated, merit-
based programs-Measurement and
Standards laboratories, ATp, MEp, and
BNQP-work together to provide the
technical capabilities that u.s. ir ~ .
needs to t~rn sc:en;i;:,c c....;..::. ;2:Cilti-':"'Il.;gl-
cal advances into commercial products
and services in a timely manner. With
NIST
Budget Highlights
more and more nations able to produce
and distribute world-class technology
products and services at competitive
prices, the key to continued U.S. eco-
nomic growth will be faster commercial-
ization of one of the nation's key advan-
tages-the best science and innovation
in the world. NIST's challenge is to
anticipate and develop the technology,
measurements, and standards required
to meet industry needs now and in the
future. Its programs must keep pace with
numerous technology trends, such as
the miniaturization and increasing speed
of electronics, the rapid growth of elec-
tronic commerce and information sys-
tems, the emergence of advanced man-
ufacturing systems, and revolutionary
advances in life sciences applications.
To meet these needs, the request
for FY 2000 will:
. Provide $5.5 million in new
funding for three initiatives in the
Measurement and Standards labora-
tories to help address the nation's sci-
ence and technology infrastructure
needs. In the first, $2 million is request-
ed to fund NIST's participation in a
Department of Commerce (DOC) initia-
tive to remove standards barriers to
expanded global trade. As part of the
Administration's Critical Infrastructure
Protection Initiative, $3 million is
reouested to develop and disseminate
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methodS needed to protect the informa-
tion technology elements of critical
. All numbers rounded. See the table on page 15 for actual figures.
national infrastructures. Finally,
$500,000 is requested to foster profes-
sional development of elementary, mid-
dle, and secondary mathematics and
science teachers.
. Provide an additional $41.2
million so ATP can continue to serve as
a significant catalyst in helping U.S.
industry turn innovative concepts into
practical technologies offering broad-
based benefits for the nation's economy.
The funding will be used to continue
current projects and conduct a competi-
tion open to all areas of technology,
thereby fostering a sustained industry
commitment to high-risk research and
promoting greater innovation and exper-
imentation in teaming and alliance for-
mation.
. Provide $1 million in new fund-
ing to gather, promote, and effectively
deploy to all MEP manufacturing exten-
sion centers the highest priority best
practices in areas such as employee
development and service delivery, both
to enhance center quality and effective-
ness and to introduce new services
quickly to help small and medium-sized
businesses compete in global markets.
The MEP request is a net decrease of
$7 million from the FY 1999 appropria-
tion, due to the natural maturation of
existing centers and the resulting
decrease in the federal funding share.
~ 1':.~GVldc an increase 0; 355 .;1;;-
lion for construction of the Advanced
Measurement laboratory as part of the
5
NIST BUDGET HIGHLIGHTS
Construction of Research Facilities
appropriation. This is a key component
of a long and thorough effort to ensure
that NIST can keep pace with advances
in science and technology and meet the
nation's requirements for advanced
technical measurements and standards.
High-technology industries in Germany,
Japan, France, and other industrialized
nations already are receiving the com-
petitive benefits of modern facilities from
their counterpart NIST organizations.
BACKGROUND AND
JUSTIFICATION
NIST promotes u.s. economic growth by
working with industry to develop and
apply technology, measurements, and
standards. This work is increasingly
important to the nation for a number of
reasons. First, globalization of markets is
creating an urgent need to harmonize
divergent national systems of measure-
NIST Resources
Fiscal Year 2000 (Proposed)*
ment, standards, and conformity assess-
ment. Second, rapid technological
change, combined with quality and cost
pressures, is heightening the need for
new standards in emerging industries
and ever more precise measurements in
established sectors. Third, technology
development today requires a wide
range of scientific and technical compe-
tencies, a fact that encourages industry
to rely on external sources of measure-
ment and standards technology and
expertise. NISI's Measurement and
Standards Laboratories lead the way in
meeting national needs in these areas.
Fourth, U.S. firms invest heavily in
research and development (R&D) but
seldom focus on infrastructure or multi-
use technologies or projects requiring
long-term investments. Furthermore, in
nascent technology areas, the cost,
technical complexity, and risks of R&D
increase the need for collaboration.
NISI's ATP helps address these needs by
sharing the risks and costs of challeng-
Total Resources = $838 million
Appropriations = $735 million
Total Staff (FTE) = 3202
"All numbers rounded. See table on page 1 S for actual figures.
ing research and promoting partner-
ships. Fifth, although small firms are crit-
ical links in supply chains and generate
large numbers of jobs (over 65 percent
of the manufacturing workforce), their
productivity often is limited by technical
and cost barriers to technology adop-
tion. The MEP helps small and medium-
sized companies overcome these barri-
ers. Finally, technology has the greatest
positive effect on organizations when it
is complemented by quality manage-
ment practices, which enhance perform-
ance and productivity. The BNQP recog-
nizes improvement in performance by
u.S. firms and disseminates criteria for
performance excellence.
NIST Program Performance
NIST uses diverse and complementary
sources of performance data to evaluate
its products, services, and processes
thoroughly. The results consistently show
that NIST provides the best, or among
the best, technology and services of its
type in the world and, moreover, has a
powerful positive impact on U.S. firms
and the overall economy. The full value
of research programs is difficult to eval-
uate, however, because of the chal-
lenges involved in quantifying new
knowledge and assessing impacts that
often accrue over long time periods
across many segments of industry and
society.
A comprehensive and rigorous
evaluation system for the Measurement
and Standards Laboratories is based on
a combination of external peer review
and internal benchmarking, microeco-
nomic impact studies, and quantitative
performance measures. The National
Research Council manages panels of
industry, academic, and government
experts who annually review and critique
NIST laboratory programs. In addition,
a permanent Visiting Committee on
Advanced Technology meets quarterly to
review and assess NISI's overall pro-
grams and priorities. To ensure that its
laboratories perform world-class
research that provides technical leader-
ship for the nation's measurement infra-
structure, NIST performs benchmarking
assessments of its capabilities relative to
6
. NIST BUDGET HIGHLIGHTS
other national metrology institutes. Most
recent benchmarking efforts show, for
example, that NIST is the best in the
world in measuring amounts of sub-
stances, temperature, humidity, air
speed, ultrasonic pressure, and certain
ranges of pressure and vacuum.
Quantitative performance meas-
ures reflect the laboratories' technology
transfer activities and the usefulness of
their products and services to industry.
For example, in FY 1998, NIST cali-
brated over 3,500 items, providing
quality assurance for an even larger
private-sector activity that disseminates
standards traceable to the national and
international measurement systems. In
addition, NIST sold almost 37,000 units
of Standard Reference Materials-certi-
fied "rulers" that companies, govern-
ment agencies, and others use to check
the accuracy of their most exacting
measurements. NIST also distributed
about 5,000 standard reference data-
base units, which provide evaluated,
high-quality data used by scientists and
by many industries for applications such
as improving the design of industrial
processes, the quality of materials, and
the performance of advanced informa-
tion technology systems.
Economic impact studies of NIST's
laboratory programs show high rates of
return and important benefits to industry.
For example, NIST's most recent eco-
nomic impact assessment focusing on
mathematical models and related meas-
urement infrastructure for semiconductor
design automation, measured impacts
on R&D efficiency, productivity, and
product quality that yield a benefit-cost
ratio of approximately 23: 1 and a social
rate of return of about 76 percent.
Another recent assessment of NIST work
on characterizing the chemical proper-
ties of alternative refrigerants estimated
a benefit-cost ratio of 4: 1 and a social
rate of return of 433 percent. The meas-
ured benefits included R&D efficiency
gains realized by u.s. refrigerant manu-
facturers and product quality and pro-
ductivity gains realized by heating and
cooling equipment manufacturers. A
study of ceramic phase diagrams
revealed impacts on R&D efficiency and
productivity among ceramic component
suppliers, yielding an estimated benefit-
cost ratio of 10: 1 and a social rate of
return of 33 percent.
The ATP has developed a multi-
faceted evaluation strategy that includes
statistical profiling of projects, real-time
monitoring of project developments,
microeconomic case studies that detail
outcomes over defined periods, and
macroeconomic projections of long-term
program and project impacts. Approxi-
mately 110 new technologies have been
commercialized as a result of ATP fund-
ing, and evaluation results show that the
ATP is successfully improving the capa-
bilities of u.s. businesses to generate
economic returns from scientific and
technological innovations for the nation.
For example, the status reports on
all ATP projects completed as of March
1997 show that technologies developed
by 15 of the 38 completed projects
have been incorporated into commer-
cially available products or services, and
that the economic benefits are expected
to be broad in scope and large in mag-
nitude. According to a recent ATP study
of more than 200 projects funded from
1993 through 1995, ATP is:
. generating high-risk, high-
impact technologies: 70 percent report-
ed a broader project scope and/or
higher level of technical risk than could
be supported by industry alone, and 35
percent of the applications represent
"new-to-the-world" solutions;
. fostering collaboration: collabo-
ration has helped 78 percent of organi-
zations to achieve project goals (85 per-
cent of those organizations reported that
ATP was responsible to a great or mod-
erate extent for the collaboration); and
. accelerating the development
and commercialization of advanced
technologies: 86 percent of organiza-
tions said they would not have undertak-
en the project without the ATP or were
significantly ahead in their R&D cycles
as a result of ATP funding.
The MEP pursues extensive evalua-
tion and assessment activities to assure
effective management and performance
and demonstrate program benefits. An
MEP National Advisory Board composed
of leaders from industry, state and local
governments, academia, and labor has
been established to independently
assess programs, plans, and policies. In
addition, independent reviews are con-
ducted of individual MEP center opera-
tions and outcomes using BNQP crite-
ria. These reviews rely on a variety of
metrics, including interim impacts on
client competitiveness (e.g., increased
sales, cost savings, capital investment,
and inventory savings) based on regular
surveys by the Census Bureau and
detailed analysis of the operations and
performance of individual centers.
Census surveys indicate that the
manufacturing extension centers are fos-
tering significant improvements in manu-
facturing and business performance. For
example, based on a recent sampling of
client companies, MEP estimates that in
FY 1998 alone MEP services generated
approximately $329 million* in new
sales, $33 million in labor and material
savings, and $44 million in inventory
savings, while also leveraging $256 mil-
lion in additional capital investment by
client firms.
The BNQP is evaluated by a Board
of Overseers, a prestigious group of
national quality and business experts.
The BNQP also uses a questionnaire
and other means to ensure its ongoing
responsiveness to the needs of U.S.
industry and business. Ultimately, the
program can be iudged by the perform-
ance of companies that follow its lead.
A new NIST stock investment study
shows, for the fourth year in a row, that
quality management can result in
impressive returns. When a hypothetical
$1,000 was "invested" in the Standard
and Poor's (S&P) 500 and in each of
the 18 companies that won the Malcolm
Baldrige National Quality Award from
1988 to 1997, the companies' stock
outperformed the S&P 500 by about 2.4
to 1.
Since 1988, more than 1.7 million
copies of the Baldrige criteria for per-
formance excellence have been distrib-
uted. The criteria, which are reviewed
annually to ensure continual improve-
. Data updated January 1999.
7
NiST BUDGET HIGHLIGHTS
ment, have been described as "probably
the single most influential document in
the modern history of American busi-
ness." A 1998 survey of chief executive
officers found that 79 percent believe
the Baldrige criteria and awards are
extremely or very valuable in stimulating
improvements in quality in U.S. compa-
nies, and 67 percent believe the criteria
and awards are extremely or very valu-
able in stimulating improvements in the
competitiveness of U.S. business.
PROGRAM DESCRIPTIONS
Measurement and
Standards laboratories
The NIST laboratories serve as the ulti-
mate U.S. reference point for measure-
ments, working with counterpart organi-
zations throughout the world to provide
companies, entire industries, and the
science and technology community with
the equivalent of a common language
needed at nearly every stage of a tech-
nical activity. The labs also further the
technical aims and capabilities of U.S.
industry and serve as impartial sources
of expertise, developing highly lever-
aged measurement capabilities and
other infrastructure technologies.
NIST laboratories perform a multi-
tude of essential functions. For example,
NIST's electrical measurements help
advance the growing $350 billion elec-
tronics sector, providing the microwave
antenna measurements used by every
major U.S. aerospace company and the
national reference standards that sup-
port the accuracy of the electric power
meters in every U.S. home and business.
NIST provides the measurement capabil-
ities underlying voluntary standards for
the manufacture of U.S.-made optical
fiber communications lines, supporting
an industry that competes in a $10 bil-
lion world market.
NIST also develops and dissemi-
nates national standards for time and
frequency to meet critical needs in
telecommunications, transportation,
and positioning (including support for
the Global Positioning System). The lab-
oratories provide chemical, biochemical,
and chemical engineering measure-
ments; standards; data; calibrations;
and predictive methods and models to
support industries and programs ranging
from chemical processing to environ-
mental monitoring to biotechnology and
health care to semiconductor manufac-
turing. As the global market demands
ever higher quality, U.S. industries
depend on NIST for calibration services
that ensure dimensional compatibility of
items manufactured at different sites and
satisfy requirements for traceability to
national standards.
In addition, NIST provides national
standards for the 11,000 U.S. mam-
mography facilities and for exposure
quality in the $10 billion U.S. photo-
graphics and X-ray film industry. The
Programs that Work: A Sampling
Measurement and Standards Laboratories
. NIST materials researcher John Cohn was named by
President Clinton to receive the Nationol Medal of Science, the
nation's highest scientific honor. He was the only federal researcher
to receive the medal in 1998. Cohn was honored as an original
thinker who has applied fundamental scientific laws to the practice
of solving down-to-earth problems, and whose contributions have
influenced three generations of materials researchers, mathemati-
cians, and solid-state physicists. Cohn is perhaps most widely
known for his co-discovery in 1984 of materials now classified
as "quasicrystals," which brought about a revolution in the field of
crystallography.
. Semiconductor manufacturers now are able to produce
circuits with features that are actually too small to be measured
reliably with existing metrology. NIST and Sandia National
Laboratories-with support and funding from International
SEMATECH and the Department of Energy-are hoping to solve
this dilemma by creating a reference material for microscopes
designed to allow accurate measurement of circuit features as small
as one-tenth of a micrometer (or 500 times thinner than a human
hair). They have demonstrated a prototype reference material with a
0.35 micrometer line and are working to apply the same concept
to narrower linewidths The electronics industrv is exoeded to use
the reference mateflal to caiibrare machines mat monitor Ilnewiatns
as microchips are manufactured.
. A NIST-developed set of algorithms has been incorporated
into commercial software designed to help computer programmers
find year 2000 problems in programs written in the C language.
Programs written in C-like those for controlling an automatic teller
machine or 0 piece of manufacturing equipment-can contain tens
of thousands to hundreds of thousands of lines of computer instruc-
tions. Programmers can use the software to figure out which of the
lines of instruction-usually about 10 percent-need to be changed
to conform to four-digit dates after the year 2000. NIST also devel-
oped a year 2000 web site-http://www.nist.gov/y2k/-that pro-
vides businesses and individuals with information and software for
assessing Y2K problems on their systems.
. The importance of weights and measures to consumers
was highlighted by a study indicating that retail pricing accuracy
has improved since 1996. The study by NIST, the Federal Trade
Commission, and weights and measures offices in 37 jurisdictions
found that the wrong price was charged for approximately one in
30 items checked in the survey of more than 100,000 consumer
products in retail stores. The 1998 study compared electronically
scanned prices with the lowest posted or advertised price of a ran-
domized sample of items in 1,033 food, department, moss mer-
chandise, drug, hardware, and other stores. NIST provided techni-
cal guidance to ensure the study was properly structured and car-
ried out.
. Scientists at NIST and the Center for Advanced Research in
Biotechnology recently determined the three-dimensional structure
of an enzyme caileo tnreonine deari';'~--:..:'::: '-..---: :-:,'-.1,::"-:' mole4
cule produced by the bacteria E. coli. Tne enzyme structure has
long intrigued scientists os it has a switch on one end for turning
itself on or off. Since the enzyme helps to produce an essential
omino acid for E. coli bacteria, pharmaceutical researchers now
con use its structure os a target for developing new antibiotic drugs.
8
. NIST BUDGET HIGHLIGHTS
NIST Center for Neutron Research, a
world-class facility where unique instru-
ments reveal the inner structure and
dynamics of virtually any material, is
used annually by about 1,300
researchers from more than 50 U.S.
companies, 90 universities, and 30
other government agencies. NIST oper-
ates the foremost U.s. fire research lab-
oratory and is the principal R&D agency
working to reduce earthquake hazards
through improved building codes and
standards and practices for structures
and lifelines. NIST also supports the U.S.
information technology sector, which
adds $680 billion to the gross domestic
product annually, by developing test
methods, computer science and engi-
neering methods that underpin metrolo-
gy, and open testbeds for industrial col-
laboration. NIST supports economic
growth through the Internet by develop-
ing test methods and security services
for infrastructure, encryption, and data
sharing.
In addition to its internal research,
in FY 1998, NIST worked on about 325
Cooperative Research and Development
Agreements (CRADAs) involving collabo-
rative R&D of mutual interest with for-
profit organizations, non-profit organiza-
tions (including universities), public and
private foundations, state and local gov-
ernments, and individuals. Since 1988,
NIST has signed more than 830
CRADAs.
The FY 2000 appropriation for the
Measurement and Standards Labora-
tories will support further development
of critical measurement technologies
and methods, calibration services,
national standards, and reference data
needed by the United States to promote
technological progress, improve product
and service quality and reliability, and
enhance international competitiveness.
For example, the NIST laboratories plan
to:
. support the semiconductor
industry by developing methods for
measuring the flatness and thickness of
wafers 300 millimeters in diameter (the
new industry standard) with uncertainties
of 2 nanometers, developing technology
for calibrating equipment that can detect
water vapor in inert processing gases at
levels about 500 times lower than can
be achieved now, and developing laser
power and energy measurements to cal-
ibrate lasers used to fabricate devices
with critical dimensions of 180 nano-
meters and below;
. develop dosimetry and radio-
activity standards for new radioactive
sources for use in prostate cancer
therapy and in preventing blood vessels
opened by balloon angioplasty from
reclosing;
. support business use of elec-
tronic commerce by developing and dis-
seminating a software translator that will
Because plants also use the enzyme, inhibiting it may offer a new
strategy for weed control. Plastics manufacturers are interested in
the enzyme because it produces a compound used to make
biodegradable plastics. Modifications in the enzyme could improve
efficiency in biodegradable plastic production.
Advanced Technology Program
. Powerful technologies that offer extraordinary advances in
the speed and convenience of DNA analysis are boosting capabili-
ties to decode genes, manage diseases, discover new drugs, and
cut costs in the trillion-dollar U.S. healthcare industry. These systems
are initial spin-offs of an ongoing ATP co-funded joint venture
aimed at making low-cost, hand-held diagnostic devices for quickly
analyzing DNA samples in doctors' offices. The devices will feature
a combination of technologies developed by two small biotechnol-
ogy firms in California. Affymetrix, Inc., adapted a photolithography
manufacturing process to make postage stamp-sized DNA chips,
which contain hundreds of thousands of gene sequences that deted
matches in blood or tissue samples up to 100 times faster than
conventional methods. Molecular Dynamics has introduced a sys-
tem that sorts and sequences DNA in 96 tiny capillaries (tubes the
size of a human hair) faster and more efficiently than traditional
methods.
. Microscopic glass bubbles filled with air, nature's ideal
insulator, may be the key to the ultrafast integrated circuits of
tomorrow. A novel insulator, xerogel, was incorporated into an inte-
grated circuit for the first time by researchers at Texas Instruments
and NanoPore, Inc., a small New Mexico company as pert oT an
ATP project. As a followup, they combined a specific xerogel
formula with a new technique for replacing conventional aluminum
wires in integrated circuits with copper, a better conductor. The
result: a new technology that could mean a 10-fold increase in
microprocessor speed and vastly more powerful computers, cellular
telephones, factory control systems, and other products. The inno-
vation demonstrates a practical solution to a critical microelectron-
ics problem: how to pack more circuits into smaller spaces without
producing "cross talk," the jumping of signals between unconnect-
ed wires.
. Cree Research, a small Durham, N.C., company, devel-
oped a better way to process silicon carbide into large, high-quality
single crystals. Commonly used os grit on sandpaper, silicon car-
bide is almost as hard as diamond, tolerates high temperatures,
and responds to electrical currents by emitting blue light. However,
it is difficult to grow enough high-quality silicon carbide crystals at
large enough sizes to make the material economically viable. ATP
co-funding helped Cree double wafer sizes from about 2.5 to 5
centimeters, reduce defects from 400 to 180 per square centimeter,
and reduce costs for blue LEDs (light emitting diodes) from 48 cents
to 18 cents. Cree's lightweight blue LEDs now are used in a wide
range of products from auto dashboards to giant stadium instant
replay displays.
Manufacturing Extension Partnership
. As part of the Small Business Working Group of the
President's Council on Year 2000 Conversion, MEP is offering sem-
inars and a computer-based tool to help small businesses better
understand and deal with the year 2000 date problem. The tool-
called Conversion 2000: Y2K Self-Help Tool-is helping small
r :r,ufactur~r~ arc others conduct an inventory of equipment,
including hardware, software and embedded systems; identify core
business systems and rate their importance to the survival of the
business; develop contingency plans; and plan and manage reme-
9
NIST BUDGET HIGHLIGHTS
convert a company's internal dictionary
of product terminology into the industry-
standard format, thus enabling engi-
neers and designers to compare prod-
ucts and check their compatibility;
. help create fair and free access
to world markets for u.s. manufacturers
by participating in international compar-
isons of the mechanical quantities asso-
ciated with mass, force, vibration, and
acoustics, and by refining and extending
SIMnet, a pilot, Internet-based system
that enables real-time measurement
comparisons and collaborations among
national metrology labs in different
regions of the world;
. assist manufacturers by increas-
ing the speed and reducing the cost of
inspections of manufactured parts
through the implementation of new
technologies on multimodal measuring
devices and development of open-
architecture interface standards for these
machines; and by establishing an
intelligent automated welding testbed to
improve weld quality and developing
interface standards that will enable
industry to use this technology
effectively;
. establish new measurement
capabilities to support new or advanced
technology development and dissemina-
tion in the chemical, materials process-
ing, and manufacturing industries as
well as new high-technology industries;
. support trends in the electronics
and computer industries toward
improved efficiency in storing, retrieving,
and processing information by commis-
sioning a nanoscale physics facility for
characterizing electric, magnetic, and
structural properties of quantum elec-
tronic devices;
. assist the u.s. auto industry in
the cost-effective use of lightweight
materials through measurement, model-
ing, and standards activities, including
the development of methods to measure
the performance of reinforcing fillers for
polymeric materials;
. assist the u.s. microelectronics
industry in designing a new generation
of higher speed devices quickly and
economically by developing experimen-
tal and computational techniques to
measure the properties of polymeric and
ceramic thin-film materials and metallic
electrical interconnects;
. advance the U.S. construction
industry by completing experimental and
finite modeling to establish baseline
structural performance characteristics of
residential housing composed of tradi-
tional and non-traditional construction
materials; developing a method based
on a flow simulation model for optimiz-
ing high-performance concrete mixtures;
and completing the virtual Cybernetic
Building Testbed for building shells,
heating and cooling systems, and fire
detection systems; and
diation projects. MEP's web site features resources, tools, and refer-
ences aimed at helping smaller companies combat the year 2000
computer problem. The site (http://www.mep.nist.govl) also pro-
vides support for small businesses using Conversion 2000.
. Boozer Lumber needed a more efficient way of making
roof trusses, one of the company's main products. With guidance
from the South Carolina Manufacturing Extension Partnership
(SCMEP), Boozer partnered with Virtek Vision International and
MiTek Industries, Inc., to take a laser projection system developed
for aerospace manufacturing and apply it to manufacturing wood
trusses. As a result, Boozer improved its production efficiency by
295 percent, added four production lines, and doubled capacity.
Boozer Lumber's new focility is one of the largest in the United
States and one of the most efficient in the world. The MEP-affiliated
SCMEP also provided workforce training, product development
engineering, and plant layout recommendations.
. Membrane Technology and Research (MTR) of California,
which manufactures separation systems used by chemical, petro-
chemical, and pharmaceutical companies, sought to transform itself
from an R&D operation to a production-oriented culture. To help
achieve its goals for a new facility, MTR turned to its local MEP affil-
iate, the Corporation for Manufocturing Excellence (Manex). Instead
of a $60,000 investment in new manufacturing software, Manex
suggested a $1,500 upgrade that involved adding a few modules
to the accounting software alreody in place. Manex and MTR also
completed a preliminary design for the layout of the new facility,
p'Jttic-,g in piece th" sroduction requi'~...,p.nts for future growth. T~p.
- -:nv 'T'--;';ons in 1- _.J ~QS imcroved pre.
;. 'i'f ':-{ c, ,eGo' ';;v i-'t:i-:=r:::,',.; cmlclpates aoubling commercial
revenues each year.
Baldrige National Quality Program
. Solar Turbines, a California firm that designs and manu-
factures industrial gas turbines, won a 1998 Mo/colm Baldrige
National Quality Award. A systematic, prevention-based approach
to ensuring a safe and healthful work environment led to a decline
in the frequency of recordable injuries from 9.53 for 1993 to 3.91
in 1997, well below the industry average of 11.8. Over the same
period, worker's compensation costs declined 32 percent, from
$532 per employee to $342 per employee, well below the industry
average of $524 per employee. Hazardous waste output has been
cut in half over the lost five years, earning the company numerous
industry and community awards.
. With 66 employees, Texas Nameplate is the smallest com-
pany ever to receive the Malcolm Baldrige Notional Quality Award.
The company manufactures and sells identification and information
labels used on 0 variety of products. An annual independent, third-
party survey shows Texas Nameplate's customers consistently give
the company on "excellent" rating in 12 key business areas, includ-
ing quality product, reliable performance, on-time delivery, and
overall satisfaction. The percent of new customers from referrals
nearly doubled from 42.5 percent in 1994 to almost 78 percent in
1997. In two key markets, the company's market share increased
from 69 to 93 percent, and from 42 to 63 percent, between 1996
and 1997.
. Boeing Airlift and Tanker Programs (A&T), which employs
8,700 at eight U.S. locations, designs, develops, and produces C-
. "'-" military airlift aircraft used by the U.S. i<ir Force Winr'~' -:' 'he
i x'18 Malcoim 8aldnge National Quality Award, A&T improvea
overall performance on key quality measures by 50 percent from
1994 to 1998. Over the same span, A& T cut cycle time by more
than 80 percent and improved efficiency by more than 70 percent.
10
. NIST BUDGET HIGHLIGHTS
. help keep the United States at
the cutting edge of information tech-
nologies by adopting an advanced
encryption standard that will provide sig-
nificantly improved security; providing
conformity assessment methods to
ensure consistency with and accurate
use of the Java specification; and devel-
oping and disseminating Standard
Reference Data and guidelines for
emerging biometric authentication tech-
niques, including facial data, to support
the needs of law enforcement and secu-
rity access designers.
Initiative:
Export Promotion
One-third of the growth of the U.S.
economy depends on exports. In 1997,
total U.S. exports amounted to $960 bil-
lion, supporting one in five U.S. manu-
facturing jobs and accounting for 2 mil-
lion new jobs in the past four years. And
yet, while world trade has been increas-
ing by 15 percent annually, total U.S.
exports have risen only 9 percent, and
exports to the European Union are
growing at less than 5 percent annually.
This problem can be attributed in part to
local or regional technical standards
that serve as barriers to U.S. exports.
The FY 2000 $2 million initiative
will support a strategy to remove or
avert technical barriers to trade by
increasing worldwide recognition of
U.S. measurements and standards and
streamlining the domestic standards
development process.
Comparisons of U.s. national
measurement standards with those of
other nations are essential to ensure that
American products are not rejected sim-
ply because of disagreements over the
methods used to perform a measure-
ment or test. As new technologies
emerge and national economies grow,
the number and frequency of such com-
pl::r:sor.s ere rising. ~'I:ST 'Nil! ~xFcnd
related activities in physical, electrical,
and radiometric measurements and
improve or develop new capabilities in
emerging and high-technology areas
such as information technology and
bictechnciogy. In addition, to meet rap-
idly increasing demand for chemical
measurement standards, NIST will
expand its portfolio of Standard
Reference Materials and seek agree-
ments with trading partners assuring
mutual recognition of each partner's
standards. Target areas will include
important U.S. export sectors such as
automobiles, fuels, pharmaceuticals,
medical diagnostics, and food.
NIST also will develop capabilities
to help U.S. industry meet the European
Union's new requirements that products
generate no harmful emissions and be
immune to electromagnetic distur-
bances. Further, NIST will resolve and
unify U.S. and international standards
efforts for coordinate measuring
machines, which are becoming common
in automotive, aerospace, heavy equip-
ment, and machine industries. These
machines provide highly accurate
dimensional measurements of mechani-
cal parts with complex shapes.
Finally, NIST will help to increase
U.S. participation in international stan-
dards development by providing $1 mil-
lion to the American National Standards
Institute (ANSI). ANSI is the official U.S.
representative to the International
Organization for Standardization and
the International Electrotechnical
Commission. An expanded infrastructure
of technical measurements and stan-
dards coupled with ANSI's strong lead-
ership and participation in the interna-
tional standards arena will support the
growth of U.S. exports by reducing or
eliminating technical barriers to trade.
Initiative:
Critical Infrastructure
Protection
The United States has both the world's
strongest military and largest national
economy, each of which is increasingly
reliant on information technology.
Attacks on, or failures of, U.S. informa-
tion systems could damage and under-
mine the nation's entire economy. Mosi
existing computer and communications
systems are vulnerable, and, if protec-
tion is added, it typically is expensive
and of questionable effectiveness. Cost-
effective technology, measurements, and
tesi methods are needed to help avert
catastrophic failures of critical infrastruc-
tures due to terrorism, war, or human
error and to reduce the fraud, waste,
and abuse perpetrated through low-level
attacks on the computer and communi-
cations infrastructure.
Presidential Decision Directive #63
calls for a national effort to improve the
security of critical infrastructures, and the
President's FY 2000 budget has made
critical infrastructure protection a major
priority. DOC is designated as lead
agency for the information and commu-
nications sector. NIST also has a legis-
lated mandate for computer security.
Accordingly, NIST will develop measure-
ments, test methods, and standards
needed to help ensure the reliability,
trustworthiness, and survivability of infor-
mation technology systems supporting
critical national infrastructures.
The $3 million initiative will focus
on efforts in security technology, system
survivability, high-confidence systems,
security for supervisory systems, and
security for federal systems. In the secur-
ity technology area, NIST will collabo-
rate with industry to accelerate the con-
vergence of standards for public key
infrastructure (which includes the mecha-
nisms, procedures, and policies for the
deployment of public key cryptography)
and the deployment of related products
and components. NIST also will develop
metrics and test methods and establish
testbeds to enable comparisons of prod-
ucts that promote system survivability.
NIST will support the development of
ultra-dependable computing technology,
which is needed, for example, to make
it possible for increased numbers of
aircraft to share the skies safely. NIST
will develop new methods of assurance
and new techniques for combining
dependable components into integrated
systems.
Supervisory systems are used to
control processing in major industrial
applications NIST will develop measure-
ment techniques to apply advanced
secu r~7', ~:- 1...",:.::::
, .
c .
.: c:,::;~ -~- .;.,:::!rvl-
sory systems. The work then will be
applied to all supervisory systems.
In addition, NIST will work with
other government agencies and the pri-
vate sector to identify resources and
cost-effective strategies for information
and help federal agencies implement
information assurance best practices.
11
. NIST BUDGET HIGHLIGHTS
Initiative:
Teacher Science and
Technology Enhancement
Program
In the 21 st century, science and technol-
ogy will play increasingly important roles
in U.S. economic competitiveness. In all
realms of business, productivity gains
and market leadership will require tech-
nical insight and scientific creativity.
However, trends in education threaten to
undermine the nation/s economic future.
Recent international studies of science
and math performance show U.S. high
school students ranking near the bottom
of industrialized nations, and fewer U.S.
students are choosing careers in science
and technology. Growth in several tech-
nical sectors of the U.S. economy
already is limited by lack of technically
skilled workers, and the problem is
expected to worsen in the next decade.
The nation needs to substantially
improve science, math, and technical
education for all its citizens to maintain
economic growth and competitiveness.
This challenge is large and complex,
but one way of improving science and
math education is to enhance the train-
ing and development of science and
math teachers.
The proposed FY 2000 $500/000
initiative will permit NIST to leverage a
modest federal investment for the great-
est benefit to science and math teachers
nationwide. NIST will develop several
ways to enhance teacher development.
Approaches include on-site training pro-
grams; community-based training pro-
grams leveraging NIST contacts with
industry; Internet-based, on-demand ref-
erences and services for teachers that
utilize and extend NIST's expertise in
forefront Internet capabilities; and other
activities that are determined to add real
value to professional enhancement of
U.S. science and math teachers.
Because the proposed funding is
modest relative to the scope of the
challenge, NIST will actively seek collab-
orations with other federal agencies,
- . .... . ~, . -' - ...... '.~
-
the private sector for greatest leverage
of federal funds.
Baldrige National Quality
Program
The BNQP has become a focal point
for strengthening America's competitive
position. The program helps many types
of companies and organizations deliver
ever improving value to customers while
improving overall organizational effec-
tiveness. It creates a performance excel-
lence standard that fosters communica-
tions and sharing in the private sector,
building networks to deliver performance
and quality management information
and services and to share lessons
learned with other economic sectors.
Applicants for the Baldrige Award
gain valuable insights by receiving 300
to 1/000 hours of review by at least six
experts on the board of examiners, who
provide a detailed feedback report on
the organization' s strengths and oppor-
tunities for improvement. Since 1988/
34 companies have received the
Baldrige award, which is given in manu-
facturing/ service, small business, and,
starting in 1999/ education and health
care. Thousands of other organizations
use the Baldrige criteria internally to
assess and improve their performance.
The BNQP has proven to be highly
effective in stimulating interest in per-
formance improvement, excellence,
sharing and cooperation, and the cre-
ation of new information networks within
the business and public sectors. Collec-
tively/ Baldrige Award recipients, examin-
ers/ and NIST staff have given more
than 50/000 presentations at confer-
ences worldwide. With a relatively small
annual federal investment, the Baldrige
program leverages over $100 million in-
kind contributions from the private sector
and state and local governments.
The FY 2000 appropriations of just
over $5 million will be used to manage
the annual award competition, conduct
a conference at which Baldrige award
winners share their performance excel-
lence strotegies, maintain a comprehen-
sive database on state and local quality
awards, continually improve the per-
f" ~_,~ _._ . ,. "~::.. __:_~,;">_..._ .l.!-...... :S'" .:
as the national standard, and facilitate
information sharing among all sectors of
the U.S. economy.
Advanced Technology
Program
The ATP shares the cost with industry of
developing novel, cutting-edge tech-
nologies for a broad range of civilian
applications that will promote U.S. eco-
nomic growth. It fosters partnerships
among companies of all sizes, universi-
ties/ and research centers to help bridge
the gap between basic research and
product development and create an
environment conducive to overcoming
daunting technical barriers and address-
ing long-range R&D opportunities. The
program assumes some of the risk of
early-stage technology development,
enabling industry to pursue promising
technologies that otherwise would be
ignored or developed too slowly to com-
pete in rapidly changing world markets.
The ATP supports R&D to the point
where it is feasible for companies to
begin product development using private
funds. The program does not fund
commercialization.
The ATP conducted 39 competi-
tions from 1991 to 1998. Through
1998/ the ATP had selected 431 proj-
ects for funding, including 146 joint ven-
tures. More than 1/000 participants,
including more than 100 different col-
leges and universities, have been
involved. About 55 percent of all ATP
projects are led by small businesses.
Two-thirds of awards made to single
companies have gone to small firms.
The awarded projects involve a commit-
ment of over $1.39 billion in NIST funds
and $1.40 billion in private-sector funds
over their lifetimes. By creating opportu-
nities for new, world-class products, ser-
vices/ and processes, the ATP benefits
not only individual project participants
but also other companies and industries
and, ultimately, consumers and
taxpayers.
The awards are made on the basis
of a rigorous competitive process that
considers the scientific and technical
merit of each proposal and its potential
benefits to the U.S. economy. Each year,
the ATP conducts a general competition
cpen to proposals involving any area of
technology. To have a greater impact in
important technology areas identified
with extensive industry input, the ATP
12
. NIST BUDGET HIGHLIGHTS
began holding focused program compe-
titions in FY 1994. In FY 1999, the ATP
is using a new competition structure that
combines the best features of both the
general and focused competitions. The
competition is open to all areas of tech-
nology, but proposals will be evaluated
and ranked in competition with others in
the same technology area. Five review
boards ore planned in biotechnology,
electronics, information technology,
manufacturing, and chemistry/materials.
The proposed FY 2000 appropria-
tion of $239 million will enable the ATP
to continue multiyear projects selected in
previous years; conduct a new competi-
tion open to all areas of technology;
and continue to implement a multifac-
eted economic evaluation program that
includes statistical profiling, microeco-
nomic case studies, and macroeconomic
projections of long-term project and
program impacts. The request, when
combined with anticipated carryover and
prior year recoveries, will permit approx-
imately $73 million for new awards.
Because small firms already lead
55 percent and participate in 70 percent
of all ATP projects, the Administration is
proposing, through the appropriation
process, that ATP be exempt from the
Small Business Innovation Research pro-
gram set-aside in FY 2000.
Manufacturing Extension
Partnership
The MEP provides small and medium-
sized manufacturers with access to tech-
nologies, resources, and expertise
through the cost-shared, cooperative
efforts of NIST, state and local govern-
ments, and local extension service
providers. The partnership is a nation-
wide network of regional manufacturing
extension centers, which are linked to
diverse federal, state, university, and pri-
vate sources of technology and exper-
tise. Each center uses the network to
provide cost-effective services to client
firms in areas such as best manufactur-
ing and business practices, workforce
development and training, access to
financing, and environmental services.
The MEP has succeeded in its initial
goal of placing critically needed exten-
sion services within reach of small and
medium-sized manufach~ers in all 50
states, the District of Columbia, and
Puerto Rico. More than 2,000 manufac-
turing specialists and professional staff
now provide services through more than
400 MEP-affiliated centers and offices.
Approximately 26,000 enterprises were
served in FY 1998.
To optimize center performance
and further increase the competitiveness
of smaller manufacturers, two efforts
were initiated recently. First, the BNQP
evaluation criteria have been adopted
as a framework for generating continu-
ous improvement in MEP-funded center
performance and impact. Second, an
integrated knowledge management sys-
tem is being developed to facilitate the
sharing of best business practices
among the centers.
In addition, MEP is training field
staff from the Department of Agriculture,
the Small Business Administration, and
others so they will be able to conduct in-
depth seminars on year 2000 issues for
their constituents across the country.
The proposed FY 2000 appropria-
tion of $100 million will enable the MEP
to reach additional manufacturers, con-
duct reviews and manage the nation-
wide network of extension centers, col-
lect and evaluate data on center per-
formance and impact on client firms,
and further develop electronic network-
ing and information capabilities. The
request includes $1 million in new fund-
ing to gather, promote, and effectively
deploy to 011 MEP manufacturing exten-
sion centers the highest priority best
practices. Currently, MEP is able to pro-
vide only very limited best practice infor-
mation to centers. Funding under this
initiative will enable MEP to accelerate
its efforts to meet center demands for
best practices information in the areas of
center operations, center business prac-
tices, and service delivery.
The FY 2000 budget request also
proposes a decrease of $9.1 million in
MEP funding. This decrease reflects a
lower federal share of the centers'
operating costs since the federal shore
changes as the centers mature. In the
first three years, the federal share is
50 percent; in year four, 40 percent. In
years five and six and for renewals, the
federal share is one-third. The number
of centers will not change as a result.
NIST Facilities
NIST maintains about 50 specialized
laboratory, office, and support buildings
on two campuses in Gaithersburg, Md.,
and Boulder, Colo. The great majority of
those buildings are 30 to 45 years old
and are deteriorating at an accelerating
rate. NIST has designed a master facili-
ties plan to guide the replacement,
renovation, or repair of these buildings
so that NIST can continue to provide
U.S. industry and science with the best
possible measurement system.
The requested FY 2000 appropria-
tion includes $95 million to be com-
bined with $108.3 million already
appropriated in FY 1998 and FY 1999
for construction of the Advanced
Measurement Laboratory (AML). The
AML will allow NIST to provide U.S.
industry and science with higher quality
NIST reference materials, improved
measurements, and foster access to
NIST research advances. The AML will
provide stringent controls on particulate
matter, temperature, vibration, and
humidity that are unattainable in current
NIST buildings. These new NIST labora-
tory facilities will be equal to, or better
than, similar laboratories overseas. Such
conditions are vital for housing the insti-
tute's most advanced metrology, physics,
chemistry, electronics, engineering, and
materials science research and will
enable NIST to keep pace with rapid
developments in semiconductors, indus-
trial robots, computers, pharmaceuticals,
and emerging technologies requiring
molecular and atomic-level precision.
The AML will be a shared resource for
NIST and the industrial and scientific
communities that work closely with NIST.
NIST also is requesting $12 million
to undertake the highest priority safety,
capacity, maintenance, and major
repairs to ensure compliance with vari-
ous federal, state, and local health and
safety regulations, to make modifications
needed to improve access for people
with disabilities, and to keep the existing
buildings in reliable working order.
This represents a one-time decrease of
$5 million to partially offset the cost of
the AML construction.
13
NTIS BUDGET HIGHLIGHTS
NTIS
Budget Highlights
SUMMARY AND
JUSTIFICATION
The National Technical Information
Service (NTIS) was established in the
aftermath of World War II to make avail-
able to industry much of the formerly
classified research performed through-
out the country in support of the war
effort as well as captured enemy
research. In 1950, the Secretary of
Commerce was given the statutory mis-
sion to collect and organize scientific,
technical, and engineering information
"from whatever sources, foreign or
domestic, that may be available" and
to "make it more readily available to
industry and business, and to the gen-
eral public." Over the course of its 50-
year history, NTIS has amassed a collec-
tion of more than 3 million items,
including the most comprehensive
collection of federal research results.
Consistent with its mission, NTIS
seeks out, organizes, stores for all time,
and makes accessible virtually all feder-
ally financed scientific, technical, and
engineering reports and complementary
material from foreign and other sources.
Unlike a commercial enterprise, which
would preserve only that material having
,.-. _:,_.....:[.:-:"....1 :....~:-'=;~:::~-' ,--,~;'~rcjal
value, N-iIS preserves maTerial based on
its potential use to U.S. industry and
business. This ensures public availability
to an accessible, convenient central
sour..::~.":" .~ ',--~. -.... ;'J -
sources, as well as a permanent record
of the government's massive investment
in research and development since the
end of World War II.
For many years, NTIS has covered
costs through fees for its products and
services. However, changes in the infor-
mation industry have resulted in declin-
ing revenues. Because the organization
and preservation of this knowledge will
benefit generations of future researchers
as well as current customers, the pro-
posed FY 2000 budget includes a
request for $2 million to partially fund
NTIS' activities to organize and preserve
the 70,000 technical 'information items
it adds to its permanent clearinghouse
each year. The remainder of these
$6 million activities, as well as all of
NTIS' other costs, will continue to be
supported through fees for products and
services.
The funding will help to ensure that
NTIS will continue to function as a true
clearinghouse and, as such, preserve
information for future researchers.
14
Technology Administration
Budget Summary
FY 1998-FY 2000
(Figures are in thousands of dollars)
FY 1998 FY 1999 FY 2000
Budget Budget Request
US/OTP $8,500 $9.495 $8,972
NIST 677,852 641,150 734,956
Scientific &: Technical Research &: Services
Measurement and Standards Laboratories 273,871 275,266 284,576
Baldrige National Quality Program ..J..m -A.8IQ 5.M6
Subtotal 276,852 280,136 289,622
Industrial Technology Services
Advanced Technology Program 192,500 197,500' 238,700
Manufacturing Extension Partnership .l.l15.QQ 1Q6jQQb 99.816
Subtotal 306,000 304,300'b 338,536
Construction of Research Facilities 95,000 56,714 106,798
NTIS 0 Ob 2,000
Total TA Appropriations 686,352 650,645 745,928
, Reflects a $6 million rescission called for in P.L. 105-277.
b Excludes funding transferred for year 2000 efforts. Pursuant to P.L. 105-277, NIST received $21 million for MEP outreach activities and NTIS $1 million
for year 2000 compliance.
15