Stimulus funds harbor hidden costs

When the American Recovery and Reinvestment Act (ARRA) doled out $10 billion to the National Institutes of Health and $3 billion to the National Science Foundation last year, many hailed it as a triumph for the US research enterprise. But the money, it turns out, comes with strings attached: keeping up with ARRA's administrative requirements is costing institutions thousands in increased overhead and may be compromising or delaying other initiatives and projects at the nation's leading research universities. "This is hugely beyond the regular reporting," Kerry Peluso, associate vice president for research administration at Emory University, told __The Scientist__. "Everyone is kind of struggling to pull together information that our systems were not designed to gather."

Though the university appreciated the research opportunities that ARRA opened up, Peluso said, keeping up with the increased reporting and compliance requirements meant hiring an extra manager and three new accountants. (Emory has attracted nearly 200 ARRA grants and more than $55 million in ARRA funding.) These extra administrative costs add up. Peluso calculated that for every $1 million Emory got in ARRA funding, the university had to spend $14,000-15,000 above the 26% overhead rate cap on federal grants. "There certainly is an impact on the university," she said. "The university is going to have to make some decisions and pull back on some initiatives." For a typical 5-year R01 grant from the NIH, Peluso noted, her office has to report to the agency annually and at the end of the grant's life, telling NIH administrators how much of the grant money was spent and how much wasn't. With ARRA funds, "We are required to report quarterly throughout the award." "We've created a huge backlog of things we're not getting to because the reporting requirements for ARRA come first," said Catherine Gorodentsev, director of Harvard University's office of sponsored programs, citing a 30% increase in the reporting her office was required to do. For example, she said that there are approximately 230 grant proposals queued up for processing by her office. (Harvard has already landed more than 215 ARRA grants and Gorodentsev said she anticipates the school to net more than $155 million in ARRA funding.) "This was something that for us has been very much a boon for science and research here," she told __The Scientist__. "That said, there is a heavy administrative burden that stems from the quarterly reporting requirements." Beyond the heightened frequency of reporting, ARRA mandated that more information be included in each of those reports. Several administrators from universities that received millions of dollars in ARRA grants told __The Scientist__ that the awards mandate more than 70 pieces of information that have to be included in those quarterly reports. These include the total award expenditures to date, the amount of the award, how much has been drawn down on the award to date, subcontractor information, and vendor information if more than $25,000 is spent on an item. linkurl:Evan Kharasch,;http://www.anest.wustl.edu/c/divisions/clinical/ interim vice chancellor for research at Washington University in St. Louis, told __The Scientist__ that his university has shuffled personnel and resources from its conflict of interest office, public and government affairs office, institutional review boards, and other areas to meet ARRA's ongoing administrative requirements. "We are largely accommodating this through existing resources and the reallocation of those resources," he said. Kharasch added that the offices from which he's had to borrow people and resources "probably did have to change some of their priorities and their productivity may have been affected." Though Kharasch said that Washington University hadn't calculated how much ARRA grants were costing his school, he said that "we do know that [the amount] was substantial." (Wash U. had gotten $84 million in ARRA funds by the end of January, according to Kharasch.) linkurl:Phillip Pizzo,;http://med.stanford.edu/profiles/Philip_Pizzo/ dean of Stanford University's School of Medicine, agreed that finding staff to meet ARRA's reporting requirements and grant deadlines has been a challenge. "We anticipated that meeting grant deadlines would require more resources and time," Pizzo wrote in an email to __The Scientist__. "Our Research Management Group worked long hours to handle the extra demands, and we did ask staff from other areas - especially Communications and Development to help support the efforts." Like Peluso, Gorodentsev noted that her university had to hire more people to log data to meet ARRA's reporting requirements. "We've had to add almost a dozen people across the university as ARRA experts," she said. Peluso also noted that the federal agencies through which ARRA funds are coming to Emory often post clarifications to rules governing reporting and compliance on the grants on the eve of a particular cycle's deadline. Other administrators shared Peluso's frustrations. Transparency, a hallmark of ARRA, seems to be one of the driving forces behind the increased reporting requirements outlined in the act. But Kharasch questioned the assumption that quarterly vs. annual reports added up to more transparency. "It's not clear what the concerns were specifically where it was felt that there was inadequate transparency that was achieved through annual reporting," he said. "One asks what will be done with the info on a quantitative basis that wouldn't have been accomplished on an annual basis." "Right now this is a struggle, but it's doable," said Ron Thompson, director of research accounting at Emory University. "What if they decide they want all our awards that way? It's a resource issue. How are we going to cover it all?" Kharasch said he hopes that ARRA's stringent award requirements are a temporary arrangement. "We hope that the shift from the former reporting and compliance model to the current reporting and compliance model is a one-time activity that remains applied to ARRA funds only and hope that this is not a model that is applied across the NIH on a permanent basis."
**__Related stories:__***linkurl:NIH recovery grants top $5 billion;http://www.the-scientist.com/blog/display/56027/
[30th September 2009]*linkurl:Stimulus Application? Not Me;http://www.the-scientist.com/article/display/55706/
[June 2009]*linkurl:NIH wins stimulus jackpot;http://www.the-scientist.com/blog/display/55418/
[12th February 2009]*linkurl:How to spend the NIH stimulus;http://www.the-scientist.com/blog/display/55413/
[11th February 2009]

Stimulus funds harbor hidden costs

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