Usually we run a video on Friday, but as I’m waiting on a few posts for later this week, I’m going to mix things up a little bit and run one earlier in the week. As Lisa Hinchliffe wrote about last week, in the US, the federal government announced a drastic cut to the amounts the NIH would pay for grant indirect costs (also called F&A, or “facilities and administration” costs). For the uninitiated, these costs seem mysterious, and perhaps it makes sense that a government claiming that it wants to cut wasteful spending would reduce them. But a clear explanation of just what these costs are all about, as provided in the video below from 2022 from the Association of American Universities and others, makes clear how essential they are to conducting research. And while there are certainly problems in the research grant system, slashing budgets so much goes far beyond efficiency and enters into the realm of wanton destruction of one of the great strengths of the country. Everything is on hold now due to multiple injunctions from multiple lawsuits, but as with all things in our new reality, no one is certain where things will land.
Discussion
1 Thought on "Indirect Costs (Facilities and Administration Cost) Explainer"
Thanks for posting the AAU Video, David!
One thing I’d like to highlight —
The library is central to determining a university’s rate.
Libraries hold a unique position as one of only five uncapped components in a research university’s indirect cost reimbursement structure.
Dropping to a 15% rate would crush research infrastructure funding, including libraries.
By diversifying library services for funded researchers, libraries can help our institutions build resilience and weather this disruption.