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139th National Cancer Advisory Board

Fourth Quarter Budget Update. Dr. Niederhuber reported that the NCI in this final quarter is making final adjustments in its allocation of the Fiscal Year (FY) 2006 budget, moving unused resources to areas where it was hoped earlier that additional funding could be provided. He noted that the NCI received a mid-year increase in taps of almost $4 M for direct utility costs to the NIH. In regard to the status of other budget lines, he reported that the Research Project Grant (RPG) payline is running about the 11th percentile, with 15 percent of the competing pool in reserve for exceptions; Type 5 grants have been funded at about 2.35 percent below the commitment of record in accord with the NIH-wide policy; funding for the Special Programs of Research Excellence (SPOREs) has been about 2 percent below the FY 2005 commitment; funding for the Cancer Centers has been essentially flat with FY 2005 with the exception that some additional money was identified and applied in a graded scale to the six Centers that were reviewed this year; and funding for training is 1 percent above the FY 2005 level. At its June 26, 2006, meeting, the NCI Executive Committee (EC) decided that sufficient resources were available to raise the payline for R01 grants to the 12th percentile and for *R01s (the new investigator mechanism) to the 18th percentile. The total of additional funds committed was $8.3 M.

Budget Planning for FY 2007. Next, Dr. Niederhuber reviewed the process by which leadership of the NCI is coming together to evaluate programs with an eye toward reduced or flat budgets for the foreseeable future. At a June 7-8, 2006, EC retreat, Division Directors presented and discussed each scientific program in their research portfolios to provide a background for future funding decisions. Dr. Niederhuber noted that the exercise produced a better understanding of what each Division was doing and planning and how collaborations could be effected across Divisions for a trans-NCI approach for the efforts. As part of the process, each Director was asked to rank each program by anonymous ballot as to whether the program should be reduced, maintained, or expanded. A prearranged scoring mechanism was used as a guide. In an ongoing process through early November, the information gained from the tabulated results of the balloting is being addressed in repeated meetings to create a prioritization list of scientific programs. Phase 2 of the planning process occurred in August when infrastructure-like programs, many of which are housed within the Office of the Director (OD), were reviewed. In Phase 3 from now until January, all scorings will be revisited multiple times and reprioritized toward a monetary target. Members were informed that both the scientific and infrastructure reviews are being conducted to identify areas where efforts can be consolidated and cost savings realized to ensure that every dollar is counted. Dr. Niederhuber noted that the RPG pool could come under similar scrutiny in the future as part of an ongoing process throughout the NIH.

To explain the current budget pressures, Dr. Niederhuber reviewed the pattern of NCI’s Congressional appropriations from FY 1998 to the projection for FY 2007. Members were reminded that the significant increase in the budget from 1998 to 2003 (NIH doubling and NCI 80 percent increase) was followed by appropriate increases in 2003 and 2004 and essentially flat budgets since then. Dr. Niederhuber pointed out that, because of the higher inflation index for biomedical research, flat budgets represent an actual 3 to 5.5 percent decrease (about $150 M) in the operating budgets for those years. Projections are that a similar or greater decrease in the operating budget could become a reality in FY 2007. Strategies to address the situation that were developed in working with colleagues across the NIH include keeping the number of competing awards (about 1,280 for the NCI) and the average dollar amount per award at the same level as the previous year. Members were reminded that appropriations bills for Labor/DHHS have been passed in both the House and Senate Subcommittees, but neither bill has come up for a vote by the full House or Senate. A vote in either house is unlikely before the November elections; therefore, the NCI will be operating on a continuing resolution after October 1 at about 80 percent of the FY 2006 level.

Dr. Niederhuber reviewed the status of the FY 2007 appropriations bill. The House version, which is essentially equal to the President’s Budget, allocates $4.754 B for the NCI, $40 M less than the


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