(The Center Square) – Wisconsin Gov. Tony Evers called the Trump Administration’s attempts to cut funding for indirect costs for grants through the National Institutes of Health reckless and said it would be “devastating” to the University of Wisconsin System’s health research.
Wisconsin was part of 22 states that sued to block the funding cut and received a temporary block of that order Monday. A Feb. 21 hearing has been set in the case.
Massachusetts, Michigan, Illinois, Arizona, California, Connecticut, Colorado, Delaware, Hawaii, Maine, Maryland, Minnesota, New Jersey, New York, Nevada, New Mexico, North Carolina, Oregon, Rhode Island, Vermont and Washington join Wisconsin in the lawsuit, filed in U.S. District Court in Massachusetts.
“To think that the Trump Administration wants to gut funding to help find cures and treatments for things like cancer, Alzheimer’s disease, and diabetes – it’s unconscionable,” Evers said. “The University of Wisconsin System is a national and global leader in helping solve real problems for people here in Wisconsin and the world over, and ensuring UW System’s success is a critical part of ensuring Wisconsin’s future economic success.”
The debate surrounds an area of grant funding called indirect costs, which go toward items categorized as facilities and administration. The new policy would put a cap of 15% of grants being spent on those indirect costs.
NIH spent $35 billion in fiscal year 2023 on 50,000 grants to 300,000 researchers at more than 2,500 medical school or research institutions with $26 billion going to direct research costs and $9 billion to indirect costs.
The average indirect cost rate has averaged between 27% and 28%. Johns Hopkins received 63.7% in indirect costs, NIH said. The University of Michigan receives 56% in indirect costs, it said.
“NIH is obligated to carefully steward grant awards to ensure taxpayer dollars are used in ways that benefit the American people and improve their quality of life,” the group said in its statement regarding the changes.
NIH compared its cap to those of private foundations funding research, with the Bill and Melinda Gates Foundation allowing for a maximum indirect rate of 15%.
The costs support the university as a whole and are not related to specific grants, the lawsuit argued, and cutting those costs would “devastate critical public health research.”
The changes apply to grants that have already been awarded, which the lawsuit argues cannot be changed after they have been agreed upon.
“The effects of the Rate Change Notice will be immediate and devastating,” the lawsuit argues. “Medical schools, universities, research institutions, and other grant recipients across the country have already budgeted for (and incurred obligations based on) the specific indirect cost rates that had been negotiated and formalized with the federal government through the designated statutory and regulatory legal process. This agency action will result in layoffs, suspension of clinical trials, disruption of ongoing research programs, and laboratory closures.”
The University of Wisconsin said a change to a 15% cap would “significantly disrupt vital research activity and delay lifesaving discoveries and cures related to cancer, Alzheimer’s disease, diabetes, and much more.”
It will also impact the ability of students from undergraduates to Ph.D. and medical students participating in research as the funding goes toward everything from utilities charges to building labs to infrastructure for new research, the university said.
“Drastic reduction to this funding will not only disrupt the day-to-day important work of the university but will ultimately harm the livelihoods of real people across Wisconsin and the country, harm the innovation economy and will make our nation less competitive,” the college said in a statement.
