Indirect Cost Recovery Research Articles

The distribution of indirect cost recovery in academic research

AbstractResearch universities rely heavily on external funding to advance knowledge and generate economic growth. In the USA, tens of billions of dollars are spent each year on research and development with the federal government contributing over half of these funds. Yet a decline in relative federal funding highlights the role of other funders and their varying contractual terms. Specifically, nonfederal funders provide lower recovery of indirect costs. Using project-level university-sponsored research administrative records from four institutions, we examine indirect cost recovery. We find significant variation in the amount of indirect funding recovered—both across and within funders, as well as to different academic fields within a university. The distribution of sponsors in the overall research funding portfolio also impacts indirect cost recovery. The recovery variation has important implications for the sustainability and cross-subsidization of the university research enterprise. Together, our results show where universities are under-recovering indirect costs.

Generating Discretionary Income in an Academic Department of Pathology

The 2021 Association of Pathology Chairs Annual Meeting included a chairs’ session and a premeeting discussion-group webinar sponsored by the Senior Fellows Group (former chairs of academic departments of pathology who have remained active in the Association of Pathology Chairs) focused on generating discretionary income for departments. Discretionary income was defined as revenue that can be used by the department with few, if any, restrictions. Such income is particularly desirable given limitations on departmental budgets. Four discussion-group panelists presented the funds-flow model in their respective institutions and how they derived and used discretionary income. Discretionary income was obtained from both external sources (eg, philanthropy, indirect cost recovery, partnerships with outside entities, medical education courses, research laboratory agreements, clinical trials) and internal sources (eg, core facilities, institutional programmatic support, institutional incentive programs). Significant departmental variations were associated with differences in institutional financial structure and policies, revenue-generating capabilities of the department and individual faculty, practice plan policies, donor intentions, and geographic market forces. Most finances were dependent upon a robust funds-flow model. Uses of discretionary funds included salary support, recruitment expenses (including start-up packages), research equipment, space renovation, social events, support of academic programs, and travel. Panelists also discussed particular challenges of discretionary-fund generation and use during the coronavirus disease 2019 pandemic. Notably, each institution had its own unique methodology for generating discretionary income, and no obvious standard approach was identified. The 2 moderators emphasized the importance of identifying and understanding opportunities, issues, and institutional culture surrounding generation and use of discretionary funds.

Sponsored Research Indirect Costs: A Single-Site Case Study of Public Research University STEM Faculty Members’ Perspectives

This explanatory case study investigated the phenomenon of one institution’s public research university STEM (science, technology, engineering and mathematics) faculty members’ perspectives on indirect cost recovery from research grant funding. The explanatory scheme incorporated organizational culture, faculty socialization, and political bargaining models in the conceptual framework. The analysis indicated that faculty socialization and organizational culture were the most dominant themes; political bargaining emerged as significantly less prominent. Public research university STEM faculty are most concerned about the survival of their research programs and the discovery facilitated by their research programs; they resort to conjecture regarding the utility of indirect cost recovery. The findings direct institutional administrators to consider less emphasis on compliance and hierarchical authority and focus on greater communication and clarity in budget processes and organizational decision-making when working with expert professionals such as science faculty; for higher education researchers, the findings indicate a need for more sophisticated models to understand organizational dependency on expert professionals.

Calculating indirect costs from international PEPFAR implementing partners.

BackgroundUNAIDS estimates global HIV investment needs in low- and middle-income countries (LMICs) at $26 billion per year in 2020. Yet international financing for HIV programs has stagnated amidst despite the increasing number of people requiring and accessing treatment. Despite increased efficiencies in HIV service delivery, evaluating programs for greater efficiencies remains necessary. While HIV budgets have been under scrutiny in recent years, indirect costs have not been quantified for any major global HIV program, but may constitute an additional avenue to identify program efficiencies. This analysis presents a method for estimating indirect costs in the President’s Emergency Plan for AIDS Relief (PEPFAR).MethodsUtilizing PEPFAR country operational plan (COP) funding data from 2007 to 2016 for international organizations (IOs) and universities and standard regulatory cost bases, we calculated modified total direct costs on which indirect cost rates may be applied by partner and funding agency. We then apply a series of plausible indirect cost rates (10%–36.28%) to develop a range for total indirect costs that have accrued over the period.FindingsOf $37.01 billion in total COP funding between 2007 and 2016, $22.24 billion (60.08%) was identifiably allocated to IOs ($17.95B) and universities ($4.29B). After excluding funding for sub-awards ($1.92B) and other expenses ($3.89B) to which indirect rates cannot be applied, $16.44B remained in combined direct and indirect costs. From this, we estimate that between $1.85B (8.30% of total international partner funding) and $4.34B (19.51%) has been spent on indirect costs from 2007–2016, including $157-$369 million in 2016.InterpretationTo our knowledge, this is the first analysis to quantify the indirect costs of major implementing partners of a global HIV funder. However, lack of transparency in the indirect cost rates of non-University international partners creates an opaque layer of programmatic costs. Given the current funding environment and evolution of HIV programming in PEPFAR countries, the findings motivate a re-examination of the current policies and the return on investment in indirect cost recovery across the PEPFAR program.

Expansion fever and soft money plague the biomedical research enterprise

Academic biomedical science has had both a long boom in its funding and a subsequent scary bust. From 1970 to 1999, NIH budgets increased 9% per year (1); from 2000 to 2004, they doubled (2, 3). In 2005 came the unmistakable bust: flat-lined NIH budgets converted the doubling into a paltry 14% increase in inflation-corrected (4) dollars over 16 years (1999–2015; Fig. 1 A ). But during the bust, two stealthier dangers escaped notice, their quantitative details and significance masked or denied. Universities recklessly overbuilt laboratories to fill with more scientists, just when the bust removed funding increases they needed to do science. As diminished NIH dollars made research riskier, universities required principal investigators (PIs) to earn high proportions of salary from grants, transferring much of the risk to PIs: Universities in the 1970s paid PIs about 75% “hard” salary from their own coffers; those coffers in the 21st century pay PIs much less, forcing them to corral most salary as “soft” grant money. Universities have recklessly overbuilt laboratories to fill with more scientists, just when lower funding from NIH eliminated the increases they needed to conduct science. Image courtesy of Dave Cutler. As responses to specific circumstances, expansion and soft money seemed innocuous during boom decades, when increasing federal grants and indirect cost recovery (ICR) allowed expansion to pay for itself. Then flat-lined NIH budgets after 2004 turned formerly prudent policies into grave dangers, allowing stagnant funding to combine with ever-expanding research facilities and reliance on soft-money salary to corrode job security and opportunities for academic biomedical scientists. Although external funds remain scarce, research universities must act to protect science from soft money and expansion, both of which they control directly. Can academic institutions rescue biomedical research and the next generation of investigators? Yes, but the task will be hard … [↵][1]1Email: hrbourne{at}gmail.com. [1]: #xref-corresp-1-1

Perfection from a simpler time

The feature article “A perfect proposal” by Daniel Kleppner and Paul Horowitz (Physics Today, January 2016, page 48) is enough to make a scientist cry. An entire field of science proposed in 800 words with a six-line equipment budget.I suspect that proposal would not fare well today. It included no salary or fringe-benefits budget, no tuition budget, and no indirect cost recovery. No environmental impact statement was prepared, even though the antenna surely changed the aesthetics of the lab building, and it wasn’t vetted by a grounds committee.No bibliography was offered, no curriculum vitae were attached, and no figures were enclosed. The submission did not contain a “broader impacts” statement; since the impact was obvious to author and reviewer, why waste words?The proposal included no mention of outreach or demographics. It gave deference to individual competitors rather than assembling a multi-investigator, cross-disciplinary team or demeaning the work of others. And the submitter had a reasonable expectation of a two-month review cycle and a high probability of funding.Perhaps that’s the point of the article: Much that attracted prior generations to science is now unfundable! If we came up with a proposal to fix what is so obviously broken with the grant and funding system, to whom would we send it?© 2016 American Institute of Physics.

Mortgaging the Future of Medical Research

Mortgaging the Future of Medical Research

Harmful Effects of Federal Research Grants

The past two decades have seen an increasing emphasis on the importance of university faculty obtaining external funding to support their research efforts. Social work faculty have not been exempt from this pressure, especially within the network of programs housed in so-called research universities. The Carnegie Foundation for the Advancement of Teaching currently designates 96 universities as Research Universities--Very High (RU/VH), meaning they annually award at least 20 doctoral degrees a year. These RU/VH institutions particularly value faculty obtaining federal research grants, although the pressure to do so is percolating throughout academe. Of the 203 Council on Social Work Education-accredited MSW programs, 47 are located in RU/VH universities. Federal research grants are among the most highly sought sources of external funding, for several reasons. One is prestige, in that the competition for such grants is very keen, with a rigorous peer-review process used to exclude all but the highest quality research proposals from being funded. A second reason is that certain forms of important research can only be undertaken with substantial funding. A third factor (perhaps paramount) is that universities are allowed to attach a percentage of the research expenses to the total amount of the grant, expenses called administrative or My own university charges a 47% overhead rate for federally funded research conducted on campus. What this means is that if a research project is budgeted at $100,000 a year, the grant will receive its $100,000 to conduct the research, and the university will receive an additional $47,000 for indirect costs. (Indirect cost recovery rates do vary across funding sources and funding mechanisms.) This overhead is used to help provide the physical plant, personnel, and other resources needed to keep the university up and running. A portion of it is usually divided between the college and department from which the grant originated, and perhaps a small amount is awarded to the principal investigator (PI) of the grant itself, to provide supplemental research funds. In 2009, my university received over $142 million in federal contracts or grants. Thus, the grant overhead income received by research-oriented universities can be a major source of institutional revenue. In this era of shrinking resources and cutbacks in state and private funding, university administrators increasingly encourage faculty to seek lucrative federal grants. Although hard data are difficult to obtain, it seems as if the profession of social work has been only modestly successful in this regard. The Society for Social Work and Research (SSWR) now publishes a directory of social work grants funded annually by the National Institutes of Health (NIH) (see https://htmldbprod.bc.edu/ pls/htmldb/f?p=545:1:2378998554668479::NO:1). A histogram of these social work grants awarded from 1987 to 2009 looks rather like a normal curve, peaking in 2002 with 53 awards and declining yearly to 28 in 2009, about the same number as in 1996 (30 awards). It is by no means an accelerating curve, sloping ever upward. Despite the pressures from within the discipline and those imposed by upper level university administrators, the writing, receipt, and execution of federally funded research grants is not an unalloyed benefit to social work faculty and other personnel involved in preparing grants, and some consequences may be positively harmful. In the following sections I present some possibly deleterious consequences of seeking federal grant funding, which are worthy of consideration by social work faculty contemplating preparing grant applications and by deans and directors who may considering ways to try and motivate their faculty to submit grants. WRITING GRANTS WASTES RESOURCES The most obvious waste of resources is in that a majority of federal research grant applications will not be funded. …

University of Medicine and Dentistry of New Jersey (UMDNJ)—New Jersey Medical School

The Dean is the chief academic officer of the medical school. Management of the educational programs is a shared responsibility of the academic departments and the Office of Education reporting to the Vice Dean. The faculty organization solicits and provides input to the Committee on Committees, which selects members for the nine standing committees that are approved by the Faculty Council (Figure 1). The Committee on Academic Programs and Policies (CAP2), a standing committee of Faculty Council, is charged with the design, evaluation, revision, approval, and oversight of the curriculum and overall educational program. CAP2 also makes recommendations to the Dean and to the Faculty Council regarding implementation of various programs. CAP2 represented by faculty, students, and administrators (ex officio) is a surrogate for the faculty at large. Members on the CAP2 are not representational of the various departments. The Dean or his designee, the Vice Dean, in concert with the CAP2 provides the strategic leadership in managing the educational programs and developing policies and procedures. The Vice Dean works closely with the academic departmental chairs, course and clerkship directors, and faculty to implement innovations in education, assessment, and evaluation as they pertain to undergraduate medical education. Two subcommittees report to the CAP2—the Preclinical and Clinical advisory subcommittees, which consist of course and clerkship directors, respectively. Subcommittees assist in achieving horizontal and vertical integration of the curriculum. A major curriculum revision was rolled out in 2004-05 (see Curriculum Renewal Process). Interdepartmental and interdisciplinary courses are managed jointly by departments and the Office of Education (OE). Office of Education

Indirect costs and other uses of facilities data at institutions

AbstractThis chapter discusses how facilities data relate to research activities and funding for those types of activities in relation to indirect cost recovery efforts.

Futures for the Humanities

Futures for the Humanities Amy Koritz (bio) Engell, James, and Anthony Dangerfield. Saving Higher Education in the Age of Money. Charlottesville and London: University of Virginia Press, 2005. 277 pp. Kezar, Adrianna J., Tony C. Chambers, and John C. Burkhardt, eds. Higher Education for the Public Good: Emerging Voices from a National Movement. San Francisco: Jossey-Bass, 2005. 345 pp. Liu, Alan . The Laws of Cool: Knowledge Work and the Culture of Information. Chicago and London: University of Chicago Press, 2004. 573 pp. The Society that can build the most productive and efficient mechanisms for harnessing human creative energy will move ahead of those continuing to make a fetish of the greed motive. Richard Florida The humanities the core of the university. She may be an outsider, but if she were asked to name the core of the university today, its core discipline, she would say it was moneymaking. J.M. Coetzee Humanists often hear these days that that we belong to downwardly mobile disciplines. This warning comes mostly from our own ranks, since those in positions of real power are too busy pulling in the rewards of status to spend much time worrying about their poor relations. Derek Bok, in his important book on the increased influence of the market on higher education, dismisses us with a single paragraph. Bok observes that humanists tend to complain about the loss of a clear, shared sense of intellectual purpose in universities and attribute their increased commercialization to this loss of purpose. In his experience, however, "[N]o faculty members feel a stronger sense of mission than the scientists, yet it is there—not in the humanities—that commercialization has taken hold most firmly" (5). Meanwhile, humanists themselves have developed a cottage industry of commentary on our degenerating health in the academy. Among these documents are many well-informed, useful, and heartfelt pleas that we refocus our collective attention away from the individualistic, career-driven model of professionalism dominant in higher education and toward the greater good of ensuring at least the survival, if not the revival, of humanistic teaching, learning, and discovery—however the writer in question understands those activities. All those cries of anger, frustration, and fear from humanists are completely warranted. It is true, as English professors James Engell and Anthony Dangerfield point out in their award-winning book Saving Higher Education in the Age of Money, that the number of bachelors degrees in the humanities has been declining steadily and that the pay differential between humanities professors and those in sciences and professional schools has been widening (according to these authors, in 1996 a beginning assistant professor in business earned on average $25,000 more annually than a similarly ranked humanist). There is certainly little question that literary studies, by any measure most of us can think of (faculty size, salary, number of majors, teaching load, good jobs for our PHDS), is not doing well. There is in fact broad consensus on the reason for this. Money. While in the United States the G.I. Bill enabled a massive influx of students into higher education, democratizing what had been an opportunity reserved for a small elite, the Cold War shaped the institutions providing [End Page 240] that opportunity by funneling federal support to scientific research. The federal funding mechanisms put in place on the heels of Vannevar Bush's Science, The Endless Frontier (1945) guaranteed that scientific research would become a crucial component in the fiscal health of universities. By attaching huge indirect cost recovery monies to grants for scientific research, the federal government ensured a steady stream of research, at least some of which would prove useful for its own ends. In contrast, the research accomplished by humanists seemingly had no value to industry or the government. Nor did the teaching of literature manage to maintain an analogous public legitimacy. Literary studies has for some time lacked a rationale that achieves either general agreement among its professional practitioners or is commonly understood and endorsed by society at large. This waning of status is distressing. The many attempts to revive the humanities and return them to their previous centrality in the education of young adults are therefore welcome...

How English Departments (and Their Chairs) Can Survive into the Twenty-First Century

To prepare an opening plenary paper for the 2004 ADE Summer Seminar East, I conducted an informal survey of English department heads, deans, provosts, and college and university presidents around the country. Whether over the telephone or over drinks at a conference, I asked each of these per sons?in their role as president, dean, provost, or department head?what was uppermost in their minds and what were their biggest headaches or concerns. Although my data are neither comprehensive nor scientific, the responses I received were instructive and surprisingly consistent. Whatever kind of institution they were at, presidents and provosts always named the current financial crisis as their number one priority and greatest headache. Declining federal and state dollars combined with weak revenues from even the healthiest endowments have left schools reeling. On some public university campuses, including my own, presidents and provosts are scrambling to refashion their schools as quasi-private institutions, substi tuting private dollars?from grants, donors, corporations, wherever?to replace the ever-shrinking dollars coming from state budgets.1 As a consequence, senior administrators are busily identifying their revenue-producing centers. These are usually departments that bring in large research grants with indirect cost recovery (ICR); or they are technology parks that lead to new companies or to patents in which the

Technology and Business Development Services for Small-Scale Coffee Production and Processing in El Salvador

An NGO project played a facilitative role in El Salvador by assisting smallholder coffee cooperatives that provided members with credit, training, extension, input supply, processing, and marketing services. Costs were recovered through processing and marketing margins and interest spreads. Lessons learned include the importance of a subsector approach to capacity building; the need to plan for external risks; appropriate roles of service providers and facilitators; the value of indirect cost recovery; validity of subsidies in post-war reconstruction; advantages of centralised credit administration; profitability of some improved environmental practices; and how expansion and replication activities increased cost effectiveness and impact.

The Effects of State Budget Policy on Research University Indirect Cost Recovery Rates and Management Accounting

This research studies the relationship between state government budgetary policy and research universities' incentives. In particular, this paper examines the effects of state government decisions that effectively tax universities by controlling universities? receipts of indirect cost recoveries earned on federally sponsored research. The effects of this policy decision on universities are examined at both a macro level (the overall rate of indirect cost recoveries) and at a micro level (the types of management accounting systems employed to support rate negotiations). Employing both archival and survey data, the results of this research demonstrate that universities subject to state taxation of indirect cost recoveries tend to have lower indirect cost rates and use less elaborate management accounting systems to support rate negotiation efforts.

The Economics of University Indirect Cost Reimbursement in Federal Research Grants

The federal government has been the most important source of funds for academic research since the 1950s. Nearly a third of this support takes the form of indirect cost recovery (overhead). Long a source of conflict between universities and the government, in recent years the indirect cost controversy has escalated, with most research universities intensively investigated for alleged abuses. This essay examines the nature of indirect costs and the sources of the conflicts about them. The main argument is that the types of costs that are covered by overhead charges must be paid for the research intensity of universities to be retained; however, the existing system for reimbursing these costs creates unnecessary distortions in the operation of universities and has very high transactions costs. Instead, both universities and the federal government would be better off if the existing indirect cost reimbursement system were replaced by a system of fixed reimbursement rates that were not related to a university?s actual indirect costs.

The costs of animal research: origins and options.

The costs of animal research: origins and options.

Equal team partners? The roles of principal investigators, co-principal investigators and co-investigators on federally supported research grants.

A survey of 188 NLN-accredited graduate nursing programs was done to determine how the research roles of principal investigator (PI), co-principal investigator (Co-PI) and co-investigator (Co-I) are supported and to examine the similarities and differences in benefits for PIs, Co-PIs and Co-Is. Most schools did not provide salary supplementation in addition to the usual salary for any investigators. For other benefits, the PI was more likely than was the Co-PI or Co-I to receive direct access to indirect cost recovery dollars, the use of extra research assistants, and the reduction of teaching time commensurate with the time supported by their grant. If the team approach is truly valued, should not all investigators be rewarded in a like manner?

Indirect cost rate variation for university research: Several conventional explanations do not work

The wide variation in indirect cost rates that universities charge the federal government in research grants and contracts has reduced the credibility of universities, as have accompanying charges that universities have been overreaching in indirect cost recovery. Many explanations for rate differences have been presented, but not systematically examined. Detailed cost and policy data from seven major research universities were used to simulate a standardization of costs and policies to eliminate several of the differences widely believed to contribute to rate variation. The result was an increase in rate variation, rather than the expected decrease. Furthermore, each of the universities could have charged the federal government a higher rate than actually charged, providing evidence that universities have not been over-reaching in indirect cost recovery.

Causal modeling for indirect cost management at universities and colleges

Faculty applications for nonuniversity project funding, relative support requested for research, and the indirect cost rate negotiated for federal research projects are used to forecast overhead one year in advance. They are also used to project the ratio of awarded indirect cost to awarded direct cost. The role of the latter variable in mediating changes in subsequent indirect cost reimbursement is described, as well. By using multiple regression and path analysis, the study demonstrates one way of bridging the gap between theories on indirect cost recovery and statistical methodology. It should be of particular interest to the administrator who seeks to integrate variables which precede overhead reimbursement in time with the university budget process.