Trump Budget Eliminates Funding for Manufacturing Extension Partnerships

Many in the manufacturing industry say cutting the program would reduce key initiatives that help American manufacturers spark innovation and grow more competitive on a global scale.

The proposed budget would entirely eliminate the $124 million allocated for the Manufacturing Extension Partnerships which has been in existence since 1988. MEPs are a public-private network of centers that assist small and mid-sized manufacturing firms with R&D, process improvement and job creation and retention.

The administration said it is aiming to end funding for organizations that duplicate the efforts of other federal or nonprofit and private sector programs. “In 2018, the National Institute of Standards and Technology will work to transition MEP centers solely to non-federal revenue streams, as was intended when the program was first established,” the administration said.

The National Association of Manufacturers, which has been a strong supporter of MEPs, joined dozens of manufacturers in a letter to Trump in March, urging him to continue funding MEPs during development of the FY18 budget. The letter called MEPs a “solid investment” that has helped increased the competitiveness of manufacturing. It said the thousands of manufacturers that have interacted with MEPs in 2016 reported $9.3 billion in new and retained sales, more than 86,000 new and retained jobs, and more than $1.4 billion in cost savings. The letter said MEPs’ services enable manufacturers to compete globally, support better supply chain integration, and offer better access to training and technologies that boost productivity.

“Modern manufacturers are increasingly technology-driven and the MEP facilitates the industry’s ability to develop and deploy innovative products and processes.”

“Modern manufacturers are increasingly technology-driven and the MEP facilitates the industry’s ability to develop and deploy innovative products and processes,” the letter said.

The letter was also signed by Georgia Association of Manufacturers, Fabricators and Manufacturers Association, the American Small Manufacturers Coalition and multiple state chambers of commerce.

As one example of how the loss would affect U.S. organizations, Manufacturing USA would have its budget cut by 70% to only $15 million. The network maintains nine manufacturing innovation institutes around the country with six more being planned by the end of the year. These centers include the American Institute for Manufacturing Integrated Photonics in Rochester, N.Y., the America Makes Center in Youngstown, Ohio, and the Digital Manufacturing and Design Innovation Institute in Chicago, Ill.

Rob Atkinson, president of the Information Technology and Innovation Foundation, said in March that he was concerned about cuts to the MEP program and said that it would reduce funding for an array of R&D programs whose discoveries help U.S. manufacturers.

In the administration’s view, MEPs could continue to operate from non-federal revenue sources, but David Hart, ITIF senior fellow, said that it would be unable to sustain itself on a national basis without federal funding. “These kinds of cuts will undermine supply chains and regional clusters that are particularly important to sustained competitive advantage in advanced manufacturing,” said Hart.

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Craig Guillot
Craig Guillot is a business writer based in New Orleans, La. His work has appeared in Wall Street Journal, Entrepreneur, CNNMoney.com and CNBC.com. You can read more about his work at www.craigdguillot.com.

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