MADISON, Wis. — Changes to federal funding directly impacts Wisconsin’s largest university. The National Institutes of Health is reducing the rate for its “indirect costs” grants to 15%, which goes into effect on February 10.
NIH defines the “indirect costs” funding being used defined for “facilities…as depreciation on buildings, equipment and capital improvements, interest on debt associated with certain buildings, equipment and capital improvements, and operations and maintenance expenses” and “administration… as general administration and general expenses such as the director’s office, accounting, personnel, and all other types of expenditures not listed specifically under one of the subcategories of ‘Facilities'”.
The University of Wisconsin–Madison, a leading biomedical research institution, said that NIH funding is UW–Madison’s largest source of federal support, and that the adjustment in funding will “significantly disrupt vital research activity and delay lifesaving discoveries and cures related to cancer, Alzheimer’s disease, diabetes, and much more”.
UW-Madison also says these reductions will “have an inevitable impact on student opportunities to engage in research activities, from undergraduates to Ph.D. and medical students. Medical innovation will be slowed, delaying the creation of new treatments, new technologies, and new health workers”, especially since the “indirect costs” funding supports “everything from utilities charges to building out the laboratories where science is done, to infrastructure for clinical trials of new medicines and treatments”.
NIH spent more than $35 billion in 2023 on almost 50,000 competitive grants to more than 300,000 researchers at more than 2,500 universities, medical schools, and other research institutions across all 50 states and the District of Columbia. Of this funding, approximately $26 billion went to direct costs for research, while $9 billion was allocated to overhead through NIH’s indirect cost rate.
