October 6, 2003

Mr. Michael J. Holland

Office of Science & Technology Policy

1650 Pennsylvania Avenue, N.W.

Washington DC 20502

Subject: National Science and Technology Council Subcommittee on

Research Business Models (68 FR 46631, August 6, 2003)

Dear Mr. Holland:

This letter is a response by The Research Foundation of State University
of New York (RF) to the National Science and Technology Council
Subcommittee (NSTCS) request for information on Research Business
Models.

The Foundation administers, on behalf of the State-operated colleges and
universities of the State University of New York, sponsored programs
supported by the federal government and other sponsors. For fiscal year
ending June 30, 2003, our expenditures from federal awards were
approximately \$487 million. A list of the campuses in the state
university system is attached.

The RF commends the NSTCS for recognizing that the practice of
scientific research has changed, for planning to review policies and
procedures relating to the business relationship between the federal
agencies and the research community, and for striving to improve the
efficiency, effectiveness, and accountability of the research
enterprise.

We have attached a detailed document with our comments and
recommendations to the NSTCS request for information on Research
Business Models. The RF has provided a response to these comment areas:

> A. Accountability
>
> B. Inconsistency of Policies and Practices Among Federal Agencies
>
> E. Regulatory Requirements
>
> F. Research Support

Thank you for the opportunity to provide comment on the business
relationship between the federal government and universities. The RF is
prepared to share our

expertise, participate in the workshops, and assist the NSTCS to assure
that a successful research business model is developed. If more
information or assistance is needed, please contact Carol H. Berdar,
Compliance Manager, (p) 518-434-7143, (f) 518-434-8343, (e)
<carol.berdar@rfsuny.org>.

> Sincerely,
>
> ![](media/image2.png){width="1.6263888888888889in" height="0.5875in"}
>
> Timothy P. Murphy\
> Executive Vice President

Attachments

Copy: John J. O'Connor

Operations Managers

Sponsored Program Administrators

Management Staff

**The Research Foundation of State University of New York**

**National Science and Technology Council Subcommittee**

**Research Business Models**

**(68 FR 46631, August 6, 2003)**

**[Comments and Recommendations]{.underline}**

**[October 6, 2003]{.underline}**

This document provides The Research Foundation of State University of
New York (RF) detailed comments and recommendations to the National
Science and Technology Council Subcommittee (NSTCS) request for
information on Research Business Models. The RF has provided a response
to these comment areas:

A. Accountability

B. Inconsistency of Policies and Practices Among Federal Agencies

E. Regulatory Requirements

F. Research Support

**A. Accountability**

The RF believes it is imperative for the federal government to maximize
the funds used to support research and education. To support research in
a business model it is important that the unique situations currently
facing universities be part of the discussion. To develop a solid
research business model between the federal agencies and universities
these areas of accountability should be addressed:

-   Minimizing the costs of compliance to those required, while
    maximizing stewardship of funds.

-   Eliminating duplicative and inconsistent requirements to relieve
    administrative and cost burdens.

-   Shifting from financial to program accountability to reflect
    qualitative scientific research outcomes.

Focusing on these areas of accountability will allow for the maximum
redirection of funds to research and education -- and will provide the
foundation for a potential solid business model. A good illustration of
a positive *shift to program accountability* is the effort reporting
process. There is a real need to redirect the focus from the
administrative and cost burden associated with effort reporting to
qualitative assessments of faculty contributions to their research
projects. The goal is to improve not to lessen the accountability.

.

The RF recommends the NSTCS adopt methods to measure research
accountability based on qualitative program outcomes, or other program
factors, and not on the perceived accuracy of effort reports. From a
*programmatic perspective*, accountability will be enhanced since the
federal agencies receive meaningful information describing actual
faculty contributions via the required project technical reports. From a
*financial perspective*, the costs of compliance will be reduced for the
federal government and universities, and this will provide institutions
with some relief from the 26% administrative cap.

[In summary]{.underline}, considering these recommendations to improve
accountability will best indicate the real results, including the
return, on the federal government's investment in scientific research
and demonstrate responsible use of public resources.

**B. Inconsistency of Policies & Practices Among Federal Agencies**

The RF believes there are trade-offs when changes in government-wide or
agency-specific policies and procedures are proposed, and that the
completion of a cost and benefit analysis should be incorporated into
the change process. A cost and benefit analysis should identify any
inconsistency of policies and practices among the federal agencies. In
addition, it should take into consideration the potential for additional
inconsistencies by universities within their unique and complex
organizational structures. To develop a solid research business model
between the federal agencies and universities these areas of
inconsistency should be addressed:

Adopting OMB (Office of Management and Budget) Circular A-110, "Uniform
Administrative Requirements for Grants and Agreements With Institutions
of Higher Education, Hospitals, and Other Non-Profit Organizations",
government-wide as the uniform core principles and implementing them
consistently across agencies while limiting agency-specific regulations
to those legislatively mandated; would relieve enormous administrative
burdens.

-   Reviewing the financial disclosure requirements for conflict of
    interest adopted by NSF (National Science Foundation) and the NIH
    (National Institutes of Health) to identify the inconsistencies; and
    develop a standard government-wide policy for these and other
    federal agencies.

-   Requiring the federal agencies to issue their final regulations to
    implement the OSTP (Office of Science and Technology Policy)
    research misconduct policy. Note: Currently only NSF has issued
    final regulations.

The RF recommends the NSTCS look to the process initiated by the
(FFAMIA) Federal Financial Assistance Management Improvement Act of 1999
(P.L. 106-107). The streamlining and simplifying initiatives under
FFAMIA were based on a commendable goal to eliminate inconsistencies in
policies and practices among the federal agencies and universities.

[In summary]{.underline}, considering these recommendations to remedy
inconsistencies will improve efficiency and cost effectiveness, reduce
administrative and cost burdens, and facilitate compliance in the
research business model for the federal agencies and universities.

**E. Regulatory Requirements**

The RF believes scientific research is not necessarily the target to
invoke regulatory differences, but often the activities associated with
research become embroiled through the imposed requirements from the
non-science agencies (e.g., Occupational Safety and Health
Administration, Nuclear Regulatory Commission). The regulatory burden
creep phenomenon is a reality, not a myth. To develop a solid research
business model between the federal agencies and universities these
aspects associated with the regulatory requirements should be addressed:

-   Understanding the regulatory burden creep: Federal agencies issue
    their implementing regulations beyond those mandated by the
    legislation either through agency precedent or perceived
    administrative need. Universities apply the regulations by
    establishing more conservative policies/procedures to avoid
    potential audit criticism. The cumulative impact on the federal
    agencies, universities -- including faculty and students -- is
    overwhelming.

-   Understanding there are non-sensitive compliance areas: There are
    certain areas under employee directives (e.g., drug-free workplace,
    lobbying) and fraud, waste, and abuse (e.g., debarment and
    suspension) that require submission of individual compliance
    certifications with each proposal. These are not sensitive
    protection and compliance areas, and the requirement for individual
    certification is excessive.

The RF recommends the NSTCS streamline the certification process and
require annual institutional assurance rather than individual assurance
with each proposal submission. This is a more effective and efficient
method to assure compliance for the federal agencies and universities,
because only a fraction of proposals are selected for an award. Adopting
the annual institutional certification/assurance will also facilitate
the use of electronic research administration methods and electronic
signature. In addition, new compliance certifications/assurances should
be required only by statutory legislation; or if the agency determines,
justifies, and communicates value-based benefits.

[In summary]{.underline}, considering these recommendations to resolve
the regulatory burden creep will minimize the escalating costs of
compliance to those required for good stewardship, eliminate duplicative
requirements, relieve administrative and cost burdens, and be the
cornerstone for an efficient and effective research business model.

**F. Research Support**

The RF believes that some federal agency RFP (Request for Proposal) and
RFA (Request for Application) seem to discourage innovative approaches
to research by allowing the proposal reviewers to only recommend funding
for those proposals/applications that focus on exactly what is being
requested in the solicitation/program announcement. To develop a solid
research business model between the federal agencies and universities
the current process for research support should address:

-   Expanding the potential for research funding beyond the scope of a
    particular RFP/RFA by providing additional, less specifically
    structured opportunities or use of Broad Agency Announcements to
    encourage the support of innovative research.

-   Promoting the essence of what scientific research really embodies --
    knowledge, discovery, and the possibility of emerging new
    technologies.

The RF recommends the NSTCS consider changes to the research support
process for both contract proposals and grant applications to maximize
federal funds used to promote the advancement of scientific research.

[In summary]{.underline}, considering these recommendations at the
proposal/application phase of the funding cycle for basic and applied
research will also connect to the research business model goals
associated with improving accountability and reflecting responsible use
of public resources.