Three weeks ago, when the Bush administration unveiled its manufacturing policy, it touted the Manufacturing Extension Partnership as a program it wanted to support. Some businesses, however, may be questioning whether that message got through to the president's budget planners - who on Feb. 2 unveiled a spending plan that some observers say puts the squeeze on MEP funding.
The Bush administration's fiscal 2005 budget defies easy description for what it means for the business community, and it's sure to be tinkered with in Congress.
The $2.4 trillion budget, with its $521 billion deficit, includes more spending for defense and domestic security. But it holds a tight line on most domestic programs, keeping spending at regulatory agencies in check and trimming some programs popular with business groups.
The largest manufacturing trade group, the National Association of Manufacturers, offered ``measured praise'' for the plan's pro-growth economic policies and tax-relief initiatives. NAM said it wants to see other tax provisions, such as extending bonus depreciation and research tax credits.
A spokesman for Washington-based NAM said the group is not pleased with the budget numbers for MEP, a network of service centers for smaller companies, or with Bush's plan to eliminate funding for the Advanced Technology Program, which provides grant funding for technology research.
The administration proposed funding MEP at $39 million, which maintains MEP at 2004 levels, but it is much less than the $106 million MEP historically has received from Washington. MEP also gets state and local funds.
``Obviously we're not happy about those cuts,'' said NAM spokesman Scot Montrey. ``You're talking about closing a lot of MEP centers.''
The administration, however, said that federal funding was not originally seen as a permanent part of MEP, and it said it wants to review MEP and coordinate it with other government programs to help manufacturers.
Maureen Healey, the chief lobbyist with the Washington-based Society of the Plastics Industry Inc., said she liked that the administration is giving a small funding increase to the part of the Commerce Department tasked with implementing its manufacturing policy, even as overall Commerce Department funding is down.
As for ATP, the administration said other government research programs are more effective, and it said that large amounts of ATP funding have gone to ``major corporations that do not need subsidies.''
Healey said she is concerned that cuts in the Department of Energy's programs for industry partnerships will mean fewer resources to SPI's partnership with DOE. However, she said that a tripling of funding for DOE ``clean coal research'' could be a good thing if it helps reduce dependence on natural gas.
Agency spending is at best flat. The Environmental Protection Agency takes a steep hit, with a 7 percent budget cut, to $7.76 billion, while the Occupational Safety and Health Administration's budget remains flat, at $461 million.