Overview
Title
To impose limitations on the amount of indirect costs allowable under Federal research awards to institutions of higher education, and for other purposes.
ELI5 AI
H.R. 6847 wants to make sure schools don't charge too much for things that aren't directly related to doing research when they get money from the government, similar to when they get money from private companies. The government will check to make sure the charges are fair and tell Congress what they find out.
Summary AI
H.R. 6847, known as the "Federal Grant Accountability Act," seeks to limit the indirect costs that institutions of higher education can charge under Federal research awards, aligning them with private research awards. The bill requires the Office of Management and Budget to annually determine the average indirect cost rate for private research awards. It mandates the Comptroller General to conduct a study comparing indirect cost rates between Federal and private research awards and report its findings to Congress. Definitions for terms like "institution of higher education" and "Federal research award" are also provided within the bill.
Published
Keywords AI
Sources
Bill Statistics
Size
Language
Complexity
AnalysisAI
Overview of the Bill
The proposed legislation, introduced as H.R. 6847, aims to regulate the amount of indirect costs that institutions of higher education can charge under federal research awards. These indirect costs, often encompassing administrative expenses and overhead, are a significant portion of research funding. The bill is designed to align these costs with those in similar private sector research awards, ensuring consistency and accountability in the financial structures of federal research funding.
Significant Issues
Lack of Specificity in Indirect Cost Rate Calculations
One of the primary concerns with this bill is its lack of clarity on how to calculate the average indirect cost rate for private research awards. Without a standardized method, this can lead to inconsistencies or disputes as institutions may interpret or implement the guidelines differently. This lack of specificity could potentially undermine the bill’s intent to create uniformity between federal and private research funding practices.
Imprecision in the Comptroller General's Study
The bill mandates a study by the Comptroller General to analyze the indirect costs associated with both federal and private research awards. However, the study lacks precise definitions and methodologies, particularly regarding terms like "average indirect cost rates" and "highest levels of funding.” This could lead to varied interpretations, making the eventual findings of the study less clear and actionable.
Potential Bias and Inflexibility
The bill’s requirement to scrutinize funding for diversity-related administrative staff under federal research awards could be perceived as having a political or social bias, inviting controversy in how such measures are implemented. Additionally, the legislation does not consider exceptions or specific circumstances where exceeding the cost limit might be necessary, which could hinder effective research administration in unique or unprecedented situations.
Complexity and Accessibility
The reliance on federal guidelines, particularly the subpart E of title 2, Code of Federal Regulations, adds complexity and may not be easily understood by audiences unfamiliar with these regulations. Additionally, referencing other legislative texts for definitions, such as the Higher Education Act of 1965, can make the bill more challenging to grasp for those without legal expertise.
Potential Impact
Broad Public Impact
For the general public, this bill aims to safeguard taxpayer funds by ensuring federal research awards are spent as effectively and transparently as possible. By potentially reducing unnecessary administrative expenses, more funding may be directed towards actual research endeavors, which might lead to advancements in fields like medicine, technology, and environmental science.
Impact on Institutions of Higher Education
Institutions may face challenges in aligning their accounting practices with the new requirements. Those accustomed to different rates in the private sector might need to adjust their budget allocations, potentially affecting ongoing projects and resource staffing. However, this alignment could also lead to a more streamlined and effective use of funds, promoting greater accountability and efficiency.
Impact on Federal Agencies and the Private Sector
Federal agencies like the National Institutes of Health and the National Science Foundation will need to ensure they apply these new standards consistently. This might require additional training and procedural changes. On the other hand, the private sector may see an opportunity to influence what is determined as "average" in their cost settings, possibly leading to competitive advantages in contracting research.
Conclusion
Overall, H.R. 6847 seeks to enhance the financial accountability of federal research funding by limiting excessive indirect costs. While there are several issues and ambiguities within the bill that could impact its effectiveness and implementation, the overarching goal reflects a move toward more responsible stewardship of public resources. Addressing these challenges could strengthen the framework and make it beneficial for all stakeholders involved.
Issues
The section on limitations for indirect costs (Section 2) does not specify how to calculate the average indirect cost rate for private research awards, leading to potential inconsistencies or disputes and impacting financial transparency.
The Comptroller General’s study in Section 3 lacks clear definitions and methodologies for assessing 'average indirect cost rates,' 'highest levels of funding,' and diversity-related administrative staff funding, which may result in ambiguity and challenges in implementation or interpretation.
Section 3's requirement to assess funding for diversity-related administrative staff can imply bias in the allocation of research funds, potentially sparking political or social controversy regarding emphasis on diversity, equity, and inclusion.
Section 2’s language regarding the indirect cost limit does not allow for exceptions or unique situations, potentially leading to inflexible and impractical application in certain research contexts.
The act’s reliance on existing federal guidelines for defining 'indirect costs' (subpart E of title 2, Code of Federal Regulations) without providing a summary or explanation could make the bill complex and difficult to understand for readers unfamiliar with these regulations.
Section 4 references specific laws (such as the Higher Education Act of 1965) for defining terms like 'institution of higher education,' potentially making the bill inaccessible to those not familiar with these external legal texts.
Sections
Sections are presented as they are annotated in the original legislative text. Any missing headers, numbers, or non-consecutive order is due to the original text.
1. Short title Read Opens in new tab
Summary AI
The first section of the bill specifies its short title, which is "Federal Grant Accountability Act."
2. Limitations on indirect costs allowable under Federal research awards Read Opens in new tab
Summary AI
The section limits the amount of indirect costs that can be charged under a Federal research award to colleges and universities, making sure it doesn’t exceed the average rate for similar private research awards. The Office of Management and Budget is responsible for determining this average rate each year, and federal guidelines will be used to define what counts as indirect costs.
3. Comptroller General study on indirect costs under Federal and private research awards Read Opens in new tab
Summary AI
The Comptroller General of the United States is tasked with conducting a study to examine the indirect costs allowed under both Federal and private research awards to higher education institutions. This study will evaluate factors like average indirect cost rates, funding for various research fields, and the use of funds for administrative staff; a report with findings and possible recommendations is to be submitted to Congress within one year of the Act's enactment.
4. Definitions Read Opens in new tab
Summary AI
The section defines key terms used in the Act. An "institution of higher education" is defined according to the Higher Education Act of 1965, a "Federal research award" refers to government support for research activities, and a "private research award" is support from private organizations for research at universities.