When budget deadlines roll around, most of what we hear is the news out of Washington. But if you’re in a federal lab or working with one, the effects show up in very real ways. Projects can stall, collaborations hang in the balance, and sometimes research just stops until things get sorted out. My guest today is Paul Zielinski, Executive Director of the Federal Laboratory Consortium. Paul knows the ins and outs of the budget process, and he’s great at cutting through the jargon. He explains what discretionary and non-discretionary spending actually mean, why deficits keep coming up year after year, and how labs adjust when Congress doesn’t pass a budget on time. He also shares what he’s seen from past shutdowns, the ripple effects on joint research, and the kinds of planning labs and their partners need to do to stay on track. We cover a lot of ground, but the big takeaway is that even with uncertainty, there are ways to prepare and keep partnerships steady. Communication makes a difference, planning matters, and the work of research doesn’t just disappear because of politics. If you’re part of this ecosystem, or curious about how federal innovation weathers the uncertainty, you’ll come away with a clearer picture of what’s at stake and what helps labs push through. In This Episode: [02:16] Paul breaks down how the government generates revenue, highlighting income taxes, Social Security contributions, and corporate taxes as key sources. [03:25] He distinguishes between non-discretionary spending, which includes programs like Social Security and Medicare, and discretionary spending, which is debated annually by Congress. [04:20] Paul details the $1.9 trillion deficit for 2024 and notes that cutting all discretionary spending would still not eliminate it. [06:40] The discussion turns to the yearly budget cycle, including how agencies develop budgets, OMB reviews them, and Congress sets targets. [09:15] Paul describes how appropriations committees are supposed to pass budgets by October 1, but this rarely happens in practice. [10:17] He explains omnibus bills, which combine all appropriations into a single package, and why some in Congress resist them. [12:21] Paul outlines what happens when appropriations expire at midnight on September 30, leaving agencies unable to spend funds. [13:06] He recalls that the last time a budget was passed on time was in 1996, emphasizing how rare timely agreements have become. [14:08] The conversation covers continuing resolutions, or CRs, which allow government operations to continue at prior funding levels with or without added conditions. [15:31] Paul notes that CRs come with restrictions, including prohibitions on starting or ending programs and requirements to spread spending evenly over months. [17:04] He discusses how continuing resolutions and lapses affect federal labs, with licensing agreements less disrupted but joint research and CRADAs often delayed. [18:21] Paul explains that in a full shutdown, most research stops while only critical services like law enforcement and security continue. [19:28] The episode looks at the varying length of past shutdowns, from just a day or two to the 36-day lapse during the Trump administration. [21:13] Paul notes that grants and small business innovation awards may continue or pause depending on agency decisions and the specific agreements in place. [22:02] He emphasizes the importance of contingency planning and open communication between agencies and their partners during uncertain times. [23:16] Paul reassures listeners that while research funding is a small slice of the budget, it generally survives periods of political gridlock. [24:32] He reflects that shutdowns and continuing resolutions have happened many times before, and while disruptive, the government always reaches a resolution. [25:04] Paul reminds federal employees that they are guaranteed back pay after shutdowns, though contractors face a greater risk of lost income. [25:42] The conversation closes with thoughts on breaking stalemates and a pointer to additional resources, including Paul’s webinar on the federal budget process. Resources: The Transfer Files: Inside the World of Federal Innovation Paul Zielinski - LinkedIn An Overview of the Federal Budget Process (for non-budget professionals) Federal Lab Consortium The Birth of Federal Tech Transfer with Special Guest: Paul Zielinski
