Charitable Grants Fill the Funding Void

Foundation funds have taken up some of the slack left by waning federal budgets, but such grants don’t often cover indirect research costs.

By | December 18, 2013

WIKIMEDIA, US DEPARTMENT OF THE TREASURYUS life-science researchers of all stripes continue to feel the funding pinch caused by October’s government shutdown and the budget-shrinking sequester. But as federal research grant programs have dried up, some researchers have sought other sources of grant money, including charitable organizations. In the 2012 fiscal year, universities, foundations, independent research institutes, and voluntary health organizations contributed to a $1.42 billion increase in non-governmental research funding over 2011, according to a new report from Research!America on the shifting science funding landscape. “As federal funding becomes more competitive, applications to foundation sources continue to increase, stiffening the competition in the already challenging nongovernment environment,” the report, released yesterday (December 17), stated. “Some philanthropic funders have been in a position to increase support in recent years, but these grants are often more competitive than federally supported grants, and many are not open to competition.”

And competition is just one of the drawbacks for researchers turning toward foundation grants to keep their research programs funded. According to Nature, many charitable grants, even sizeable ones, fail to cover indirect costs, such as computational support, lab techs, and building fees. “People have been discouraged from applying for grants because the department has to cover the shortfall,” Lita Nelsen, director of the technology-licensing office at the Massachusetts Institute of Technology, told Nature. “We’re at the edge here of turning down money.”

Most philanthropic organizations, such as the Bill & Melinda Gates Foundation, only cover 10 percent of indirect costs, or overhead, while federal grants cover 100 percent. This leaves awardees scrambling to find a way to pay for overhead on the projects they get funded by foundation grants. Such costs can add up to 40 percent to 70 percent of the cost of US research, according to Nature.

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Avatar of: Kathy Barker

Kathy Barker

Posts: 44

December 18, 2013

So, charitable grants aren't actually filling the void, at all....

It is impossible for many institutions to cover indirect costs if only 10% is covered. 

What strategies are being used to fill that gap?

Avatar of: Paul Stein

Paul Stein

Posts: 237

December 18, 2013

The fact that foundations do not support indirect costs is good.  Over the decades, the research institutions have developed an unnecessary infrastructure and it's about time they focused on what is truly important.  "Overhead" should be the institutions' responsibility, and many are inordinately sucking the lifeblood out of funding agencies to be thrown into these dollar holes.

Avatar of: PeterK


Posts: 2

Replied to a comment from Paul Stein made on December 18, 2013

December 20, 2013

I agree with the bloated bureaucracy interpretation, but some institutions simply forbid their researchers from pursuing the foundation money because of the lack of overhead support. In my case, that was the last straw, and I left the state university department where these rules are still in effect. It might have been different if the overhead was used to benefit those who bring in the money, but that is rarely the case.

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