On Monday, two separate lawsuits were filed in response to a policy change from the National Institutes of Health (NIH) announced late Friday. In the first suit, filed Monday morning, attorneys general from 22 states, including Washington, sought to prevent NIH’s move to unilaterally lower the “indirect cost” rates on research grants to 15 percent.
The action in question occurred Friday evening, when the NIH announced a significant reduction in grant funding for research institutions. The announcement declared that the NIH will limit the amount granted to research universities for indirect costs at 15 percent moving forward, on both future and existing grants.
Indirect costs, also referred to as “facilities and administration” (F&A) costs, are the essential-but-behind-the-scenes costs of conducting research. These costs include, but are not limited to, laboratory materials, high-speed data processing, security protections, patient safety, radiation safety and hazardous waste disposal, personnel required to support administrative and compliance work, and many other necessary activities.
Typically, when the government provides a grant to a research university, it includes support for both direct and indirect costs. The indirect cost rates are based on allowable direct costs of research that can be assigned to a research grant. Historically, the federal government has reimbursed the university for a percentage of these allowable direct costs. Indirect costs are never fully reimbursed by the federal government, meaning full costs of research are never fully recovered by the institution performing the research. The level of F&A expenses that the federal government covers for each institution is determined by either the Department of Defense Office of Naval Research or the Department of Health and Human Services and is reviewed every 2 to 4 years through a comprehensive negotiation process.
Late last evening, the court in Massachusetts issued a temporary restraining order against the NIH in response to the suit.
Given the potential implications of such a move by the NIH, three higher education associations in which UW is active—the Association of American Universities (AAU), Association of Public and Land-grant Universities (APLU), and American Council on Education (ACE)—took the unprecedented step of also filing a separate lawsuit against the agency Monday evening. The suit seeks a temporary restraining order as well as an injunction against the NIH.
Currently, as a result of the language in funding bills for the NIH dating back to FY2017, the NIH is prohibited from lowering the indirect cost rates unilaterally.
The NIH’s move has received criticism from several Members of the Senate, including Republicans. Appropriations Committee Chair Susan Collins (R-ME), has issued a statement strongly opposing the NIH move. Republican Senator Katie Britt of Alabama issued a statement encouraging the agency to take a “smart, targeted approach…in order to not hinder life-saving, groundbreaking research at high-achieving institutions…”
Over the weekend, Sen. Patty Murray of Washington, the Ranking Member of the Appropriations Committee, issued a statement raising strong objections about the NIH move.
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