Appendix E
Estimated Recommendation Cost Tables
The following tables provide each implementation action and a “back of the envelope” estimate of the incremental annual cost to the federal government for each. These cost estimates are to illustrate the size of the program the committee is proposing and are not definitive. To obtain a more definitive estimate, economic modeling would be necessary.
Since the prepublication version of the report was released on October 12, 2005, policy-makers have requested a 10-year annual cost estimate for the committee’s recommendations. That estimate is what is presented here. In developing this estimate, the committee collected more detailed information than it had at that time to develop these cost estimates. In addition, we have attempted to provide sufficient information so that the cost estimates could be re-created.
In many cases, programs are phased in over a number of years. In addition, some of the scholarship and fellowship programs take 3-4 years to reach steady state.
The aggregate cost estimate of all the recommendations remain in the same range as the committee developed in October 2005. The cost estimate at that time was $9.2 to $23.8 billion. The current aggregate cost estimate is $8.6 to $19.8 billion.
Gathering Storm Annual Cost Estimate, by Recommendation, 2007-2016 (millions of dollars)
Recommendation |
2007 |
2008 |
2009 |
2010 |
2011 |
K–12 |
376 |
747 |
1219 |
1689 |
1976 |
Research |
1670 |
2790 |
4010 |
5430 |
6850 |
Higher Education |
1100 |
1700 |
2300 |
2675 |
2675 |
Innovation |
5423 |
5423 |
5423 |
5423 |
5423 |
TOTAL |
8569 |
10660 |
12952 |
15217 |
16924 |
Gathering Storm Annual Cost Estimate, by Action Item, 2007-2016 (millions of dollars) |
|||||
Action Item |
Recommendation |
2007 |
2008 |
2009 |
2010 |
A-1 |
Recruit 10,000 Teachers |
110 |
295 |
550 |
815 |
A-2a |
Summer Institutes |
40 |
80 |
120 |
120 |
A-2b |
Master’s Program |
46 |
92 |
158 |
224 |
A-2c |
AP/IB Teacher Incentives |
100 |
179 |
265 |
363 |
A-2d |
Science and Math Curriculum |
20 |
20 |
20 |
20 |
A-3 |
AP/IB Student Incentives |
60 |
81 |
106 |
147 |
Total (K–12) |
376 |
747 |
1219 |
1689 |
|
B-1 |
Long-Term Basic Research |
800 |
1700 |
2700 |
3900 |
B-2 |
Early-Career Research Award |
20 |
40 |
60 |
80 |
B-3 |
Research Infrastructure |
500 |
500 |
500 |
500 |
B-4 |
High-Risk Research |
0 |
0 |
0 |
0 |
B-5 |
ARPA-Energy |
300 |
500 |
700 |
900 |
B-6 |
Presidential Innovation Award |
50 |
50 |
50 |
50 |
Total (Research) |
1670 |
2790 |
4010 |
5430 |
|
C-1 |
Undergraduate Scholarships |
375 |
750 |
1125 |
1500 |
C-2 |
Graduate Portable Fellowships |
225 |
450 |
675 |
675 |
C-3 |
Continuing Educ. Tax Credit |
500 |
500 |
500 |
500 |
C-4 |
Expedite Visa Processing |
0 |
0 |
0 |
0 |
C-5 |
Intl Student Work Permits |
0 |
0 |
0 |
0 |
C-6 |
Skills-Based Immigration Policy |
0 |
0 |
0 |
0 |
Total (Higher Education) |
1100 |
1700 |
2300 |
2675 |
|
D-1 |
Intellectual Property Protection |
323 |
323 |
323 |
323 |
D-2 |
R&D Tax Credit |
5100 |
5100 |
5100 |
5100 |
D-3 |
Innovation Tax Incentives Study |
0 |
0 |
0 |
0 |
D-4 |
Ubiquitous Broadband Internet |
0 |
0 |
0 |
0 |
Total (Incentives for Innovation) |
5423 |
5423 |
5423 |
5423 |
|
|
|
2007 |
2008 |
2009 |
2010 |
Grand Total (Billions of Dollars) |
8.6 |
10.7 |
13 |
15.2 |
5-Year Total |
2012 |
2013 |
2014 |
2015 |
2016 |
% of Total in 2016 |
6007 |
2071 |
2091 |
2091 |
2091 |
2091 |
10.5 |
20750 |
8250 |
9650 |
9650 |
9650 |
9650 |
48.6 |
10450 |
2675 |
2675 |
2675 |
2675 |
2675 |
13.5 |
27115 |
5423 |
5423 |
5423 |
5423 |
5423 |
27.3 |
64322 |
18419 |
19839 |
19839 |
19839 |
19839 |
99.9 |
2011 |
5-Year Total |
2012 |
2013 |
2014 |
2015 |
2016 |
965 |
2735 |
1040 |
1040 |
1040 |
1040 |
1040 |
120 |
480 |
120 |
120 |
120 |
120 |
120 |
290 |
810 |
310 |
330 |
330 |
330 |
330 |
400 |
1307 |
400 |
400 |
400 |
400 |
400 |
20 |
100 |
20 |
20 |
20 |
20 |
20 |
181 |
575 |
181 |
181 |
181 |
181 |
181 |
1976 |
6007 |
2071 |
2091 |
2091 |
2091 |
2091 |
5200 |
14300 |
6600 |
8000 |
8000 |
8000 |
8000 |
100 |
300 |
100 |
100 |
100 |
100 |
100 |
500 |
2500 |
500 |
500 |
500 |
500 |
500 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
1000 |
3400 |
1000 |
1000 |
1000 |
1000 |
1000 |
50 |
250 |
50 |
50 |
50 |
50 |
50 |
6850 |
20750 |
8250 |
9650 |
9650 |
9650 |
9650 |
1500 |
5250 |
1500 |
1500 |
1500 |
1500 |
1500 |
675 |
2700 |
675 |
675 |
675 |
675 |
675 |
500 |
2500 |
500 |
500 |
500 |
500 |
500 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
2675 |
10450 |
2675 |
2675 |
2675 |
2675 |
2675 |
323 |
1615 |
323 |
323 |
323 |
323 |
323 |
5100 |
25500 |
5100 |
5100 |
5100 |
5100 |
5100 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
0 |
5423 |
27115 |
5423 |
5423 |
5423 |
5423 |
5423 |
2011 |
10045 |
2012 |
2013 |
2014 |
2015 |
2016 |
16.9 |
64.4 |
18.4 |
19.8 |
19.8 |
19.8 |
19.8 |
Action A-1 (Recruit 10,000 Teachers) Detailed Analysis
Year |
2007 |
2008 |
2009 |
2010 |
Millions of Dollars |
|
|
|
|
Scholarships |
75 |
225 |
450 |
675 |
Bonuses |
0 |
0 |
0 |
40 |
Institutional Awards |
35 |
70 |
100 |
100 |
Total |
110 |
295 |
550 |
815 |
Scholarship if $15,000 per Year |
|
|
|
|
Number of Old Students |
5000 |
5000 |
15000 |
30000 |
Number of New Students |
|
10000 |
15000 |
15000 |
Scholarship $ |
15000 |
15000 |
15000 |
15000 |
Total $M |
75 |
225 |
450 |
675 |
Bonuses |
|
|
|
|
Number of Teachers |
0 |
0 |
0 |
4000 |
Bonus $ |
0 |
0 |
0 |
10000 |
Total $M |
0 |
0 |
0 |
40 |
Institutional Matching Grants |
|
|
|
|
Number of Institutions |
35 |
70 |
100 |
100 |
Grant $M |
|
|
|
1111 |
Total $M |
35 |
70 |
100 |
100 |
Action A-2a (Summer Institutes) Detailed Analysis
Year |
2007 |
2008 |
2009 |
2010 |
Number of Teachers |
16500 |
33500 |
50000 |
50000 |
Cost per Teacher ($) |
2400 |
2400 |
2400 |
2400 |
Total ($M) |
40 |
80 |
120 |
120 |
Action A-2b (Master’s Program) Detailed Analysis
Year |
|
2007 |
2008 |
2009 |
Number of Programs |
100 |
200 |
300 |
400 |
Students per Program |
20 |
20 |
20 |
20 |
Number of Students/Program |
2000 |
4000 |
6000 |
8000 |
Cost per Student |
23000 |
23000 |
23000 |
23000 |
Cost per Program ($M) |
46 |
92 |
138 |
184 |
Number of Graduates |
|
|
2000 |
4000 |
Cost per Bonus |
|
|
10000 |
10000 |
Bonus Cost ($M) |
|
|
20 |
40 |
Total ($M) |
46 |
92 |
158 |
224 |
NOTE: Program cost estimate based on email from Hai-Lung Dai of the University of Pennsylvania to Deborah Stine dated December 20, 2005. |
2011 |
2012 |
2013 |
Steady State |
825 |
900 |
900 |
900 |
40 |
40 |
40 |
40 |
100 |
100 |
100 |
100 |
965 |
1040 |
1040 |
1040 |
45000 |
55000 |
60000 |
60000 |
10000 |
5000 |
|
|
15000 |
15000 |
15000 |
15000 |
825 |
900 |
900 |
900 |
4000 |
4000 |
4000 |
4000 |
10000 |
10000 |
10000 |
10000 |
40 |
40 |
40 |
40 |
100 |
100 |
100 |
100 |
|
|
111 |
1 |
100 |
100 |
100 |
100 |
2011 |
2012 |
2013 |
Steady State |
50000 |
50000 |
50000 |
50000 |
2400 |
2400 |
2400 |
2400 |
120 |
120 |
120 |
120 |
2010 |
2011 |
2012 |
2013 |
Steady State |
500 |
500 |
500 |
500 |
|
20 |
20 |
20 |
20 |
|
10000 |
10000 |
10000 |
10000 |
|
23000 |
23000 |
23000 |
23000 |
|
230 |
230 |
230 |
230 |
|
6000 |
8000 |
10000 |
10000 |
|
10000 |
10000 |
10000 |
10000 |
|
60 |
80 |
100 |
100 |
|
290 |
310 |
330 |
330 |
|
Action A-2c (AP/IB Teacher Incentive Program) Detailed Analysis
Year |
2007 |
2008 |
2009 |
Number of Math and Science AP/IB Teachers |
14000 |
28000 |
42000 |
Number Laying the Foundation (LTF) (Pre-AP/IB) Teachers |
16000 |
32000 |
48000 |
Training Fee per Teacher |
800 |
800 |
800 |
Total Training Cost ($M) |
24 |
48 |
72 |
Stipend Fee/AP/IB Teacher |
1800 |
1800 |
1800 |
Total Stipends for AP/IB Teachers ($M) |
25 |
50 |
76 |
Stipend Fee/LTF Teacher |
1000 |
1000 |
1000 |
Total Stipends for LTF Teachers ($M) |
16 |
32 |
48 |
Estimated Number of Passing AP/IB Scores |
313500 |
385000 |
495000 |
Teacher Bonus for Passing AP/IB Scores |
100 |
100 |
100 |
Total AP/IB Teacher Bonuses ($M) |
31 |
39 |
50 |
Estimated Number of Passing LTF Scores |
160000 |
384000 |
768000 |
Teacher Bonus for Passing LTF Scores |
25 |
25 |
25 |
Total LTF Teacher Bonuses ($M) |
4 |
10 |
19 |
Total ($M) |
100 |
179 |
265 |
Action A-2d (Curriculum Standards)
Cost: $100 million over 5 years
Action A-3 (AP/IB Student Incentive Program) Detailed Analysis
Year |
2007 |
2008 |
Number of Math and Science AP/IB Students |
570000 |
700000 |
Exam Fee (50% of $82 fee) |
41 |
41 |
Total AP-IB Exam Fee Cost |
23 |
29 |
Estimated Number of Passing AP/IB Scores |
313500 |
385000 |
Student Mini-Scholarship for Passing AP/IB Scores |
100 |
100 |
Total Mini-Scholarships |
31 |
39 |
Number of Pre-AP/IB Students Taking Test |
640000 |
1280000 |
Exam Fee (50% of $20 fee) |
10 |
10 |
Total Pre-AP/IB Exam Fee Cost |
6 |
13 |
Total ($M) |
60 |
81 |
2010 |
2011 |
2012 |
2013 |
Steady State |
56000 |
56000 |
56000 |
56000 |
56000 |
64000 |
64000 |
64000 |
64000 |
64000 |
800 |
800 |
800 |
800 |
800 |
96 |
96 |
96 |
96 |
96 |
1800 |
1800 |
1800 |
1800 |
1800 |
101 |
101 |
101 |
101 |
101 |
1000 |
1000 |
1000 |
1000 |
1000 |
64 |
64 |
64 |
64 |
64 |
700000 |
870000 |
870000 |
870000 |
870000 |
100 |
100 |
100 |
100 |
100 |
70 |
87 |
87 |
87 |
87 |
1280000 |
2080000 |
2080000 |
2080000 |
2080000 |
25 |
25 |
25 |
25 |
25 |
32 |
52 |
52 |
52 |
52 |
363 |
400 |
400 |
400 |
400 |
2009 |
2010 |
2011 |
2012 |
Steady State |
900000 |
1250000 |
1500000 |
1500000 |
1500000 |
41 |
41 |
41 |
41 |
41 |
37 |
51 |
62 |
62 |
62 |
495000 |
700000 |
870000 |
870000 |
870000 |
100 |
100 |
100 |
100 |
100 |
50 |
70 |
87 |
87 |
87 |
1920000 |
2560000 |
3200000 |
3200000 |
3200000 |
10 |
10 |
10 |
10 |
10 |
19 |
26 |
32 |
32 |
32 |
106 |
147 |
181 |
181 |
181 |
Action B-1 (Research Funding) Detailed Analysis: The base for this cost estimate was determined using information from the following National Science Foundation (NSF) publication: Federal Funds for Research and Development: Fiscal Years 2002, 2003, and 2004 (Publication No: NSF 05-307), which identifies the amount of basic research funding, by agency, in the physical sciences, mathematics, computer sciences, and engineering. (FY 2004 is the most recent year this information is available.) This is summarized in the table below:
Preliminary federal obligations for basic research in the physical sciences, mathematics, computer sciences, and engineering, by agency, FY 2004a
The committee also proposed that all of DOD basic research funding be increased. The following number provides the amount of DOD basic research funding included and not included in the table above (i.e., not in the research fields identified):
DOD Basic Research Funding (including above): $1.6 billion (not including above): $0.5 billion
This provides a total base: $7.9 billion ($7.4B + $0.5B), which is that increased at a rate of 10% per year over the next 7 years as indicated in the recommendation.
Year |
2007 |
2008 |
2009 |
2010 |
2011 |
2012 |
2013 |
Millions of Dollars |
800 |
1700 |
2700 |
3900 |
5200 |
6600 |
8000 |
Action B-2 (Early-Career Research Grants) Detailed Analysis: As with the scholarship programs, this estimate gradually increases over time as the $500,000 research grants are payable over 5 years.
Year |
2007 |
2008 |
2009 |
2010 |
Steady State |
#Previous Researchers |
|
200 |
400 |
600 |
800 |
#New Researchers |
200 |
200 |
200 |
200 |
200 |
Research $ |
100000 |
100000 |
100000 |
100000 |
100000 |
Total $M |
20 |
40 |
60 |
80 |
100 |
Action B-3 (Advanced Research Instrumentation and Facilities) Detailed Analysis: This proposed action indicates that the funding will be $500 million per year for the next 5 years.
Year |
2007 |
2008 |
2009 |
2010 |
2011 |
Millions of Dollars |
500 |
500 |
500 |
500 |
500 |
Action B-4 (High-Risk Research) Detailed Analysis: No new funds required for this action—just a specification that 8% of existing funds will be directed toward high-risk research.
Action B-5 (ARPA-E) Detailed Analysis: This recommendation indicates that ARPA-E will be funded at $300 million per year, gradually increasing over 5-6 years to $1 billion per year at which time it would be evaluated.
Year |
2007 |
2008 |
2009 |
2010 |
2011 |
2012 |
2013 |
2014 |
2015 |
2016 |
Millions of Dollars |
300 |
500 |
700 |
900 |
1000 |
1000 |
1000 |
1000 |
1000 |
1000 |
Action B-6 (Presidential Innovation Award) Detailed Analysis: This program for a Presidential Innovation award would not require a monetary award, but one may be provided as indicated here.
Year |
2007 |
2008 |
2009 |
2010 |
2011 |
2012 |
2013 |
2014 |
2015 |
2016 |
Millions of Dollars |
50 |
50 |
50 |
50 |
50 |
50 |
50 |
50 |
50 |
50 |
Action C-1 (Undergraduate Scholarships) Detailed Analysis: The committee recommends that up to $20,000/year be provided for scholarships. This analysis focuses on the mid-range scholarship of $15,000/year. This allows the amount of the scholarship to vary relative to an institution’s tuition. Because scholarship programs provide funding for a number of years, this program will take several years to reach steady state (when the number of new students entering is equal to the number of old students graduating and no longer receiving a scholarship).
Year |
2007 |
2008 |
2009 |
2010 |
Steady State |
#Old Students |
|
25000 |
50000 |
75000 |
100000 |
#New Students |
25000 |
25000 |
25000 |
25000 |
|
Scholarship $ |
15000 |
15000 |
15000 |
15000 |
15000 |
Total $M |
375 |
750 |
1125 |
1500 |
1500 |
Action C-2 (Graduate Fellowships) Detailed Analysis: As with the undergraduate scholarships, the committee recommends that up to $20,000/year be provided for fellowships. This analysis focuses on the mid-range fellowship of $15,000/year. This allows the amount of the fellowship to vary relative to an institution’s tuition. Because fellowship programs provide funding for a number of years, this program will take several years to reach steady state. This program also provides a stipend for the graduate student at $30,000/year.
Year |
2007 |
2008 |
2009 |
Steady State |
#Old Students |
|
5000 |
10000 |
15000 |
#New students |
5000 |
5000 |
5000 |
|
Fellowship $ |
15000 |
15000 |
15000 |
15000 |
Stipend $ |
30000 |
30000 |
30000 |
30000 |
Total $M |
225 |
450 |
675 |
675 |
Action C-3 (Continuing Education) Detailed Analysis: Based on a similar existing credit, the budget for this action is assumed to be $500 million per year. Education tax credits are available to individual families to help defray the cost of college. According to the College Board, the federal government provided $81.5 billion in student aid during 2003-2004. This can be roughly disaggregated as follows: 70% loans, 21% grants, 8% tax benefits. The tax benefits (Hope and Lifetime Learning Credits) amounted to approximately $6.3 billion. The $500 million the committee proposes is a modest amount in this context designed to spur corporate sponsorship of continuing education. The cap on tax credits could be increased over time or even lifted altogether. The following Web page provides an overview of existing tax credits: http://www.ed.gov/offices/OPE/PPI/HOPE/index.html.
Actions C-4 to C-7 (International Students and Scholars) Detailed Analysis: These are assumed to have no major cost as they involve only a policy change.
Action D-1 (Enhance Intellectual Property Protection) Detailed Analysis: The base amount for this estimate is the FY 2006 request for the US Patent and Trademark Office which was $1.7 billion, a 10% increase from FY 2005. The proposed $340 million per year, reflects a 20% increase in FY 2007 in order to institute a post-grant review system and enhance other capabilities aimed at increasing the quality and timeliness of patent examinations. The other proposed changes do not require funding.
Year |
2007 |
2008 |
2009 |
2010 |
2011 |
2012 |
2013 |
2014 |
Millions of Dollars |
340 |
340 |
340 |
340 |
340 |
340 |
340 |
340 |
Action D-2 (Strengthen the R&D Tax Credit) Detailed Analysis: Tax credits vary from year to year. In FY 2005 the R&D tax credit was forecast to cost $5.1 billion. Since the amount of the R&D tax credit in any given year depends on overall corporate profitability and tax liability, as well as on R&D spending decisions, the overall cost cannot be determined precisely in advance. Maintaining the existing R&D tax credit, therefore, is assumed to result in no incremental cost. The proposed doubling of the existing R&D tax credit is assumed to cost about the same as the existing R&D tax credit, but the actual increment could be larger or smaller. In addition, the proposed expansion of the number of companies eligible for the R&D tax credit is not reflected in the $5.1 billion figure as the number of companies who might potentially be involved is unknown.
Year |
2007 |
2008 |
2009 |
2010 |
2011 |
2012 |
2013 |
2014 |
Millions of Dollars |
5100 |
5100 |
5100 |
5100 |
5100 |
5100 |
5100 |
5100 |
Action D-3 (Innovation Tax Incentive Study) Detailed Analysis: The proposed studies should be able to be performed within existing budgets.
Action D-4 (Ubiquitous Broadband Internet) Detailed Analysis: The most important steps would not necessarily entail federal outlays.