Universities doing federally sponsored research are allowed to claim certain administrative expenses as part of science projects and are reimbursed from federal funds. This payment has been a significant source of income for many campuses.
Unfortunately, the temptation to take advantage of the available federal financing has led some schools to be rather loose with their definition of "administrative" costs.Investigators recently charged 20 colleges - nearly all of them prestigious private institutions - with padding their accounts with millions of dollars of "inappropriate" expenses in the past decade.
These reimbursement accounts have not only featured inflated versions of legitimate costs, but have included such items as yachts, country club memberships, engraved decanters, sculpture and resort travel.
As a result, the Bush administration this week imposed a ceiling of 26 percent of the direct cost of research projects for administrative expenses. The federal government simply won't pay anything above that.
In 1990, Harvard Medical School charged the government 39 percent of research costs for administrative expenses; the University of Southern California, 37 percent; Columbia University, 36 percent; and Yale University, 36 percent.
Officials of the Association of American Universities say the cap will cost schools over the 26 percent limit about $100 million, a substantial sum at a time when higher education is scrambling for adequate funding. But they have mostly themselves to blame for the new rule.
The expense limit will reward the efficient and that's not a bad thing.
Fortunately, the University of Utah, the school most heavily involved in research projects in the state, will not be hurt by the 26 percent cap.
The U. charges the federal government 25 percent of project costs for administrative overhead. In fact, the U. has been pre-approved by the government for research funding for the next three years, an indication that federal officials are satisfied they are getting their money's worth.
The money saved by the expense cap will go back into the federal research budget. It will be used to fund hundreds of additional projects - in effect, taking the money out of administrative expenses and putting it into actual laboratory work.
University scientists around the country have been calling for more funds for research. Support for scientific research has been essentially stagnant in real terms since 1968, and famous scientists have urged that it be doubled.
While such a step can easily be justified, it is unlikely in an era of dangerous federal deficits, austere budgets and an explosion of scientific advances and worthy projects, all seeking research funds.
In any case, a study by the federal Office of Technology Assessment noted this week that boosts in government support tend to result in more and larger applications for research grants. This almost guarantees that supply can never catch up to demand.
What the nation needs at this point is a mechanism to help the federal establishment arrive at meaningful priorities for science research.
And if the United States is going to keep up in the world of science and technology, private business clearly must take on more responsibility for research projects instead of leaving it up to Washington.