Wednesday, Feb. 19, 2025

Breaking down indirect costs |  ODOKU | News | Upcoming events

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In the past two weeks, we have been responding to a call from the Office of Research for concrete examples of the impact of our research. I deeply appreciate the speed and breadth of responses many of you have provided  to John Colombo's requests for examples. LSI researchers have submitted everything from testimonials by research participants to concrete statistics about effective interventions to known economic impacts to the number of people employed because of a project. The examples have not only helped bolster arguments being made by the University about the need for continued research investment. They also are providing a wealth of examples for us to communicate to a wide public audience that our research has improved lives and makes a difference to Kansans, their families, schools and communities—and people beyond the state's borders. I'll share more about that as we develop materials using those examples in the weeks and months ahead. 

If you have an example of how your research tangibly benefits Kansans that you would like to contribute, please let me know and I'll add it to our growing pool of examples. -Jen

Jen Humphrey, associate director for strategic communications

The Trump administration recently announced that indirect costs would be capped at 15% for all NIH-funded projects.  Currently, indirect cost rates at research universities across the nation vary from 50% to 80% (KU’s rate is 53%).  The announcement imposed this cap on all new and existing grants (thus reducing KU’s revenue by over 70%), with an implied threat of retroactively applying this rate to previous years of existing grants (which would force KU to pay money back).  While this move has been challenged in court, its eventual fate is still highly uncertain. 

What are indirect costs?
Indirect costs are also known as Facilities and Administration (F&A) costs.  The Administrative (“A” part) rate is constant at 26% [see note 1, below]. The Facilities cost (at KU, the “F” part is 27%) is negotiated on a periodic basis with the federal government and varies as a function of the institution’s investment in its research infrastructure and facilities.  Private institutions have justified higher F&A rates (70%-80%) because their spending on infrastructure and brick-and-mortar facilities was not subsidized by public (i.e., state) funds [see note 2, below].

What’s the history of indirect costs?
After World War II, when the federal agencies supporting research were expanding, indirect costs were once actually direct costs…that is, support personnel, electricity, heat, maintenance, etc., were included directly in grant budgets based on the calculation that institutions would split these costs evenly with federal sponsors. So, right off, the agreement was that federal agencies would only be asked to shoulder half of the costs of housing and maintaining research that the agencies agreed to support.  However, it quickly proved too onerous (for both parties involved) to track these costs, and an agreement was struck in which these institutional costs would be reflected as an amount paid to the institutions as a percentage of those costs to conduct the research per se.

What are indirect costs used for?  
This varies across different institutions and how their revenue streams are configured.  At some institutions, indirect costs are pooled with other institutional revenue and used for general operating costs [see note 3, below].  In other places, they are redistributed to units for research development and support (e.g., infrastructure and startup).  Here at KU, those funds were largely designated to support the operations of the Office of Research.  Specifically, indirect costs are processed through a nonprofit organization (the Kansas University Center for Research, or KUCR) that keeps them separate from KU’s general operating budget.  Because KUCR relies on these funds as operational costs for KU’s research sector (they currently comprise 70% of that office’s budget), that office keeps the lion’s share of the F&A.  The budgets of the university designated centers (of which LSI is one) are drawn largely from these funds.  Building costs and maintenance, startup, IRB, contracts, grant management services, computing, and core labs are all derived from these funds, as are strategic initiatives such as grant development and investment for the future.

What are the effects of cutting the indirect cost rate?
In the short term, this will cause a massive shortfall in revenue at institutions.  Locally, this hamstrings the Office of Research, in that long-term commitments (the LSI budget being one of those) are made on the basis of F&A revenue; these reduced revenues will certainly affect the designated centers.  From a conceptual perspective, it disproportionately shifts the burden of supporting research to institutions; institutions will need – with virtually no notice or time to plan – to re-imagine how they support research, and be increasingly selective on what areas are prioritized (and, by extension, what areas are not).  But what is especially problematic in the long run is that, practically, this will likely lead to a devaluing of the research mission within the higher education system.

Why is this happening?
We can speculate about the larger political rationales for this, but I will leave that to all of you.  The rationale given for the cut is that universities have accepted F&A rates from private foundations and other sponsoring entities that are far lower than the federally negotiated rate, and thus the federal government is paying “above market” rates.  It is true that institutions do accept lower F&A rates (indeed, some awards come with no F&A).  In reality, the actual realized F&A rate across the university is only about 20%-22% (at LSI it ranges from 16% to 19%).  While accepting lower F&A rates has been actively discouraged (even within LSI), the fact is that federal sources do not cover all the problems and phenomena that our scientists work on, and that federal allocations for the problems that they do work on has not kept pace -- only 1 in 10 proposals are actually funded when, in reality (based on my experience reviewing at NIH, NSF, and IES), at least double that proportion represent projects that are meritorious and deserving of funding.

To summarize…some talking points:

• Universities carry out the research that is prioritized by the federal government (i.e., the people of the United States).   

• Indirect costs reimburse universities for a portion of the costs of housing that research and for complying with the fiscal and ethical regulations that govern the conduct of that work.

• The reduction in indirect costs proposed here will be devastating to the mission of most research institutions, and in the long run will disadvantage American superiority in basic, translational, and applied sciences.

Footnotes:

Researchers at the University of Kansas are developing and expanding a program that will give teachers new capabilities powered by AI to help students with disabilities improve their writing skills with immediate scoring and feedback.

A research team at the Life Span Institute at KU received a five-year, $1.875 million grant from the U.S. Department of Education Office of Special Education Stepping Up competition to develop Project AI-SCORE, Artificial Intelligence Scored Composition to Improve Outcomes for Written Expression. The project will work with teachers and students with disabilities to spend more time practicing writing while using technology to give educators more ability to quickly score students’ writing samples and provide immediate feedback to help the students improve their abilities.

The project is led by Sean Smith, professor of special education and principal investigator of the grant Bruce Frey, professor of educational psychology, and Samantha Goldman, doctoral candidate in special education.

Read more about the project. 

On February 14, KU Provost Barbara Bichelmeyer, Vice Chancelor for Research Shelley Hooks and other KU officials offered a second virtual town hall event to offer answers to the KU community about the effect of federal executive orders, and proposed state legislative initiatives. In this second Town Hall, they emphasized that they are working on addressing the proposed 15% cap on indirect costs, developing procedures around supporting staff and researchers who have been directly affected by stop work orders, and noted that researchers are in the best position to tell their story (guidance on this is forthcoming in the next Connections). They also stressed that researchers should spend grant funds as long as it’s reasonable, allocable, and allowable on a project; within the Life Span Institute, please contact your grant coordinator if you have questions or want to discuss expenditures for your project. 

As before, if you receive a stop work order or similar information, please contact Alicia Reed in the Office of Research and copy proposal development at lsipd@ku.edu

Recordings of both town halls are available on the Provost's website. 

On Thursday and Friday this week, Feb. 20-21, the KU community is participating in One Day One KU. Last year, contributions during this 24-hour fundraising event helped the Life Span Institute purchase a new, accessible van that has filled a critical need for accessible transportation to meetings and conferences and to support engagement with Kansas communities.

We often draw attention to the fact that the research we conduct at the Life Span Institute matters: it improves the health, development and well-being of people across the state and extends to a global reach. There is no better time than to promote that message than now, when funding for research is threatened. 

This year, there are some key changes for One Day One KU. One is that the campaign, while still 24 hours, takes place from noon to noon instead of midnight to midnight, so it is spread across Thursday and Friday. At a more local level, for a variety of reasons, the Life Span Institute will broadly encourage donations to support any area of the institute, its centers or other KU causes that are important to you. While we are not raising funds for a specific project, all funds raised during the event will support our research, service and outreach through the Friends of the Life Span Institute. You may also want to support the campaigns offered by other KU units or being promoted by some Life Span Institute centers. 

If you have the capacity to give that day, you can contribute through our link or by giving to another area of KU that is important to you. 

Whether you plan to give or not, one of the most valuable ways to support the campaign is to share our social media posts from our Instagram and Facebook accounts on Feb. 20-21, and let others know why you value the Life Span Institute to encourage them to give.

Survey: Everyone should have received an email to ask for participation in a survey being distributed by the KU Office of Research for the 2025 self-study underway. It is critical for all LSI researchers and staff to complete the survey, which will be used to evaluate the Life Span Institute this spring. 

Autism training for practitioners: The GAIN (Global Autism Interactive Network is offering a workshop for clinicians and researchers involved in the diagnostic assessment of ASD on Feb. 21,  March 7, and March 14, 10 a.m. - 2 p.m. CST. The workshop will be led by Somer Bishop, Ph.D., Department of Psychiatry and Behavioral Science Weill Institute for Neurosciences, University of California San Francisco. The purpose of this workshop is to help clinicians understand how social communication abnormalities, restricted and repetitive behaviors, and developmental histories of children with ASD may be similar or different compared to children with other diagnoses 9 e.g., intellectual disability, language disorder, genetic syndromes) who commonly present for ASD evaluation in early childhood. The workshop will also discuss the uses and limitations of currently available ASD assessment tools, including sensitivity and specificity when used in different subgroups of young children. Register here.  

Registration is now open for Autism Across the Life Span: The one-day conference will be held 8 a.m. to 5 p.m. Friday, March 14 at the KU Edwards Campus. Presented by the Kansas Center For Autism Research and Training, the conference brings together families, autistics, researchers, educators, providers and students. Keynote speakers this year are Steve Kanne, Professor of Psychology, Weill Cornell Medical College, and Kristin Sohl, MD, Professor of Clinical Pediatrics, University of Missouri Health Care 

The 57th Annual Gatlinburg Conference: Registration is open for the Gatlinburg Conference, April 7-10th in San Diego, Calif. The 2025 theme for the Gatlinburg Conference on Research and Theory in Intellectual and Developmental Disabilities is "Memory, Attention and Executive Function."

REDCap Resource: REDCap meetups organized by Lisa Hallberg in Research Design and Analysis are held the third Thursday of each month at 1 p.m. The next meeting will be 1 p.m. Thursday, Feb. 20th, on Zoom  (code: 2025)   

Connections is produced by communications staff at the Life Span Institute for affiliated researchers, staff and students. 

Writing and editing by Jen Humphrey; KU News story by Mike Krings
Art provided by Adobe Stock and KU Marketing.

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