Sections of this page:
- Updates from campus sources and funding agencies
- What will sequestration mean for North Carolina?
- Share your sequestration concerns
- By the Numbers
- Frequently Asked Questions
- Video: UNC/NCSU professor Joe DeSimone on sequestration
- A message from UNC’s Holden Thorp, Duke’s Richard Brodhead, and NCSU’s Randy Woodson
- Learn more
The $85 billion in across-the-board budget cuts under the sequester for federal FY13 went into effect on March 1st. Sequestration will have a major effect on UNC-Chapel Hill and across North Carolina. Funding cuts will impact on research-related agencies, emergency management, and defense, among dozens of others. Federal research funding and student aid are the primary areas sequestration will affect at Carolina.
“University research is big business in North Carolina. UNC-Chapel Hill alone brings in $767 million annually in research funding—primarily from federal sources. If sequestration takes effect we stand to lose $28 million in federal fiscal year 2013. A cut of that magnitude could cost the state more than 400 jobs this year and slow the search for new technologies, life-saving medical treatments and promising cures.”
—Barbara Entwisle, Vice Chancellor for Research
Federal funds are essential to the groundbreaking research that takes place at UNC-Chapel Hill each year. In fiscal year 2012, $545 million of the $767 million Carolina received in research funding came from federal funds. Some of Carolina’s neediest students would also be affected by cuts from the sequestration. In 2013, dozens of students would lose the federal work study funds or Supplemental Education Opportunity grants that help make their college education.
In recent weeks, UNC-Chapel Hill joined research universities from around the nation in urging Congress and President Obama to avert the sequester. Joseph DeSimone, Director of the Kenan Institute of Private Enterprise and Chancellor’s Eminent Professor of Chemistry at UNC-Chapel Hill, is one of nearly two dozen professors and researchers who recorded a video testimonial asking Washington to avoid making these cuts.
“University research is big business in North Carolina, ” said Barbara Entwisle, Vice Chancellor of Research at UNC-Chapel Hill. “UNC-Chapel Hill alone brings in $767 million annually in research funding—primarily from federal sources. If sequestration takes effect we stand to lose $28 million in federal fiscal year 2013. A cut of that magnitude could cost the state more than 400 jobs this year and slow the search for new technologies, life-saving medical treatments and promising cures.”
Here’s just one good example: the cuts threaten UNC pharmacy researcher Jian Liu’s work on a safer blood thinner that could ultimately prevent the import of tainted drugs from China. You can learn more in this story from CNN Money.
In what areas of the University will these cuts be felt?
Sequestration will affect the University primarily in two areas: federal research funding and federal student aid.
How much of Carolina’s budget will be affected by sequestration?
Of Carolina’s $767 million in research funding in fiscal year 2012, $545 million came from federal funds. Sequestration is expected to result in a 5.2 percent cut in federal research spending, which means that Carolina could lose $28 million in fiscal year 2013, and potentially more in coming years.
Carolina also stands to lose more than $175,000 in federal student aid that is currently used to support minority students and those in need of financial aid.
What will be the effects of decreased federal research funding?
The current situation creates a great deal of uncertainty for planning purposes for all the faculty investigators, labs, centers and institutes that bring research funding into the state. We do not yet know the particulars about where cuts will be felt, but the majority of federal funding to Carolina is for research, which generates jobs, innovation, and health care advances.
The National Institutes of Health has indicated that it will likely reduce funding levels of noncompeting continuation grants, make fewer competing awards and may not be able to reach the full fiscal year 2013 commitment level to grantees for continuation awards that have already been made. The NSF has indicated that it will cut back on new awards.
What will be the effects of decreased federal student aid?
In 2013, approximately 46 of Carolina’s neediest students will lose federal work study and 25 students will lose access to assistance from the Supplemental Education Opportunity grant, an award for students whose families are not able to contribute financially to their education. Cuts to the McNair Scholars Program and the Graduate Assistance in Areas of National Need (GAANN) grant will also take place, thereby limiting critical paths for minorities to succeed in graduate education.
Will these cuts affect jobs at Carolina?
The NIH estimates that 17.5 jobs are created from every $1 million in NIH funding. Of the $28 million the University is expected to lose, $20 million comes from the NIH. That could result in the loss of 350 jobs currently funded by the NIH. Potentially 100 more jobs could be lost due to cuts from other federal agencies.
A message from UNC’s Holden Thorp, Duke’s Richard Brodhead, and NCSU’s Randy Woodson, excerpted from an op-ed published Wednesday, Dec 12, 2012, in the News & Observer.
The three of us share a concern that goes beyond our friendly rivalry. We’re concerned about the… [threats] to slash federal spending on science and research in ways that could be devastating for innovation and economic development in North Carolina.
Our concern reaches beyond our own campuses to our many neighbors across the state whose jobs depend, directly or indirectly, on North Carolina’s retaining a vibrant research enterprise.
“The federal research budget is a huge economic engine.”
As the News & Observer noted recently about the local economy, “the federal research budget is a huge economic engine.” At our three universities, federal research funds support important work — from new cancer treatments to emerging fields such as nanotechnology. The federal investment in research in our region climbs well into the billions of dollars when we add in local colleges and universities, RTI International and federal agencies with major local facilities, such as the Environmental Protection Agency and the National Institutes of Health.
Awarded by the federal government through a rigorous competitive process, research dollars sustain the basic and translational research typically carried out at universities.
The ideas and insights that are generated are often taken up by local private companies — from technology and pharmaceutical giants in Research Triangle Park to small startups.
These companies create many thousands of jobs as well as new computer apps, genomic therapies and green technologies.
This research ecosystem, which also includes the many local businesses that furnish laboratories with equipment and supplies, has been central to North Carolina’s economic emergence over the past half-century.
Previously, the state’s economy languished as traditional industries such as tobacco, textiles and furniture declined. In response, our three universities, together with forward-thinking government and business leaders, worked together to establish a new economy built on research, drawing on the substantial intellectual resources already in our state. Their bold vision proved successful beyond anyone’s dreams, laying the groundwork for major new software companies, energy technologies, life-saving therapies and more — and for countless jobs.
North Carolina has not been the only state to embrace scientific innovation. Nationally, more than half of the country’s economic growth since World War II can be traced to technological advances. The federal government’s steady investment in scientific research and innovation over the past several decades has given rise to everything from lasers to the Internet. These advances, in turn, have driven prosperity and transformed life from Silicon Valley to Boston, with our own region among the major beneficiaries.
Now, this engine of economic growth is threatened. Even without automatic cuts, federal research funding, adjusted for inflation, is at its lowest point in a decade. Legislators in Washington are looking for ways to cut spending further from the federal budget. If they cannot reach agreement, the nation faces draconian spending cuts… including to research in the Triangle…
“Research is not a luxury, or an expenditure we can do without. Rather, it is an investment. It’s spending today to produce prosperity tomorrow.”
As they ponder their options, they must recognize that research is not a luxury, or an expenditure we can do without. Rather, it is an investment. It’s spending today to produce prosperity tomorrow. It is also an investment to educate the young people who should become the next generation of scientists, entrepreneurs, business executives and leaders in other fields.
We must be strategic in how we prioritize federal spending, placing greater emphasis on programs such as research and education that provide great returns on investment and drive economic growth.
The Research Triangle Park, Centennial Campus in Raleigh, the American Tobacco Campus in Durham, and so many other places in our area exist because of previous federal investment in our region’s research enterprise. Maintaining this activity is essential not only for local universities like ours, whose budgets and programs would be devastated by some of the cutbacks now under discussion, but for the region as a whole.
In other words, the very future of our state depends on sustaining this federal research funding. We’re raising our voices together, because we’re all in this together.
Richard Brodhead is the president of Duke University. Holden Thorp is the chancellor of the University of North Carolina at Chapel Hill. Randy Woodson is the chancellor of N.C. State University.
“Right now, researchers at the University of North Carolina are developing a synthetic version of the blood-thinner heparin that could eliminate the need to continue importing the drug… Unfortunately, this research project is at risk due to NIH funding cuts. If that happens, we may lose yet another extraordinary opportunity for economic growth rooted in NIH funding. There are many other stories like this at university laboratories across the country, which is why we must provide the resources necessary to achieve these biomedical discoveries here in the U.S.”
—from APLU President Peter McPherson’s testimony before the House Labor/HHS Appropriations Committee
- APLU President Peter McPherson’s full testimony before the House Labor/HHS Appropriations Committee on the sequester (Association of Public and Land-grant Universities)
- Concerns about federal funding cuts voiced (UNC home page)
- Sequestration’s impact on research in North Carolina (ScienceWorks for U.S.)
- Federal sequestration and America’s research enterprise: What will federal budget sequestration mean for research and other vital programs that rely on public funding? (ScienceWorks for U.S.)
- Engine Stalled: Sequestration’s impact on NIH and the biomedical research enterprise (United for Medical Research)
- National Institutes of Health and North Carolina: North Carolina could lose millions in critical research investment (NIH)
- Sequestration resources from the American Association for the Advancement of Science (AAAS)
- Testimony of Hunter R. Rawlings III, President, Association of American Universities, before the United States Senate Committee on the Budget
- Letter to President Obama and Congressional leaders from the Association of American Universities and the Association of Public and Land-grant Universities
- Sequestration resource center from the Society of Research Administrators International
- Budget deficits, investment, and the fiscal cliff from the Association of American Universities
- May 8, 2013: NIH Fiscal Policy for Grant Awards, FY2013
- May 7, 2013: NIH Mechanism Table accompanying FY2013 Operating Plan
- April 30, 2013: NIH Sequestration Operating Plan for 2013
- April 24, 2013: Memo from Department of Defense Re: DoD delays of new awards for 2012 applications recommended for funding
- April 19, 2013: Memo from Barbara Entwisle to UNC-Chapel Hill Deans, Directors, Department Chairs, and all faculty
- April 9, 2013: Message from Federal Demonstration Partnership clarifying NASA’s position on sequestration cuts as they relate to travel
- April 8, 2013: Memo from Kimrey Rhinehardt, VP for Federal Relations, UNC General Administration outlining the background and potential effects of the sequester
- April 8, 2013: Document from NASFAA calculating what schools can expect from the sequestration
- April 1, 2013: Consolidated sequestration guidance from NASA: overrides or updates earlier NASA-distributed documents
- March 22, 2013: Memo from NASA: waiver from guidance for education and public outreach activities under sequestration
- March 21, 2013: Memo from Office on Violence Against Women to OVW grantees
- March 21, 2013: Clarification on NASA travel policy
- March 18, 2013: Memo from Office of Justice Programs to grantees
- March 18, 2013: Impacts of Sequestration on NOAA and NIST from the American Institute of Physics
- March 13, 2013: Guidance from NASA on the sequester
- March 8, 2013: Impacts of Sequestration on Office of Science Programs from the American Institute of Physics
- March 12, 2013: Memo from USDA to UNC President Tom Ross on the sequester
- March 12, 2013: Memo from USAID to grantees
- March 7, 2013: Memo from Harold Varmus, National Cancer Institute to the NCI-supported scientific community
- March 5, 2013: Memo from NASA to contractors, grantees, and agreement participants
- March 4, 2013: Memo from CDC to colleagues
- March 4, 2013: Memo from HRSA to grantees
- March 4, 2013: Memo from the Department of Energy to contractors/financial-assistance recipients
- March 4, 2013: Memo from NIH to all NIH grantees.
- March 4, 2013: Memo from NIH to all NIH contractors. (Note that the information in this memo applies to NIH contractors, not NIH grant recipients.)
- March 1, 2013: OMB Report to the Congress on the Joint Committee Sequestration for Fiscal Year 2013
- March 1, 2013: Memo from Vice Chancellor for Research Barbara Entwisle to UNC campus: “As of noon today it appears that sequestration will come to pass. What is more, the Continuing Resolution, which expires on March 27, has yet to be addressed. For these reasons, there are challenges ahead with our federal grants and contracts that will require prudent planning.” Read more…
- February 28, 2013: Memo from Defense Threat Reduction Agency on sequestration communications and planning
- Feb. 27, 2013: NSF notice: impact of sequestration on NSF awards. NSF has also released a notice highlighting how sequestration will impact the agency’s FY2013 budget. NSF aims to maintain existing awards, protect the NSF workforce, and protect STEM human capital development programs. The agency memo states, “the major impact of sequestration will be seen in reductions to the number of new research grants and cooperative agreements awarded in FY 2013. We anticipate that the total number of new research grants will be reduced by approximately 1,000.” Read more…
- Feb. 21, 2013: NIH operation plan in the event of a sequestration. NIH has released a brief description of how the agency will address the budget sequester slated to begin on March 1. NIH will likely resort to reducing the final FY 2013 funding levels of noncompeting continuation grants and will make fewer competing awards to allow the agency to meet the lowered budget allocation. The guidance also states that each Institute and Center will also announce their respective approaches to meeting the new budget level. Read more…
- Jan. 28, 2013: Memo from Vice Chancellor for Research Barbara Entwisle to UNC campus: “I have seen various estimates of what sequestration will mean for federal science budgets… Planning is clearly needed, but it is difficult to know what to plan for.” Read more…