Penn State Study Targets Causes of Federal Grant Process Strains

10-14-97
University Park, Pa. --- Uncoordinated federal agency efforts to shift more of the costs of doing research onto universities, coupled with overly competitive, game-like behavior by some academic grant seekers, is causing the system to break down, according to a Penn State economist.

Dr. Irwin Feller, director of Penn State's Institute for Policy Research and Evaluation and professor of economics, says, "The system of grant-supported research that has worked so well for our society's benefit in the past is now undergoing multiple stresses and needs to be reconstituted and reformulated."

Feller's comments are based on his recently completed study involving the nation's top 200 research universities for COSMOS Corporation, a social science think tank. The study was funded by the National Science Foundation, Division of Research, Evaluation and Communication.

In his study, Feller found that the uncoordinated way in which federal agencies attempt to shift or share research costs with universities via matching fund or cost sharing requirements is a particular problem. Each federal agency focuses solely on its own relationship with a university, and no agency considers the aggregate impact of the widespread and increasing use of matching and cost-sharing requirements. With more funding agencies demanding matching funds and insisting that universities cost-share, the result has been a cumulative strain on university budgets.

Although federal officials constantly emphasize that matching/cost-sharing contributions are marginal factors in decisions concerning major awards, this was not the perception among university administrators interviewed by Feller in his study. From the university perspective, flexible language in government guidelines allows grant program managers to play universities against one another, using the cost-sharing offers of one institution to seek increased offers from others.

In a recent interview, Feller noted that universities could, of course, refuse to participate in cost-share bidding. However, Feller says, since increasing numbers of schools and faculty members are doing research, competition for grants is especially keen. In addition, federal research support is frequently associated with academic prestige and universities use the ability to obtain grants as a measure of their success. Consequently, the temptation to participate in competitive behavior is often overwhelming and even leads some researchers to make cost-share bids when none are required.

Feller makes four recommendations in the report:

1. Rethink and review the rationale for federal funding of academic research. The social contract metaphor -- the proposition that the federal government should pay all of the costs of research because the results benefit the common good rather than the university -- is no longer accepted by federal agencies.

2. Review the cumulative financial impact of federal agency matching fund and cost-sharing requirements across agencies.

3. Increase the specificity of required levels of matching/cost sharing in the proposal selection criteria and pre-award budget negotiations.

4 Appoint an ombudsman within federal granting agencies to review university complaints about alleged deviations from policy by program managers.

Feller's report, Matching Fund and Cost-Sharing Experiences of U.S. Research Universities, is available from Penn State's Institute for Policy Research and Evaluation, by contacting (814) 865-9561.

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EDITORS: Dr. Feller is at (814) 865-9561.

Contacts:
Barbara Hale (814) 865-9481 (office) (814) 238-0997 (home) bah@psu.edu
Vicki Fong (814) 865-9481 (office) (814) 238-1221 (home) vyf1@psu.edu