# Presentation: 769316

## How research costs are paid

**Test tubes, mice, drugs, lab technicians...**
- Paid by ‘_**direct**_’ grant dollars, i.e. what you ask for in your grant budget
**Electricity, building depreciation, HR, security...**
- Granting agencies send money to the institution based on a surcharge or ‘_**indirect rate’**_ applied to the grant.
- NIH, industry, and foundations send indirects to BCM for grants that the school administers.
- Central Office sends _**VERA**__ __**dollars**_ to MEDVAMC for VA grants as well as other grants that use the VA as performance site
**Investigator’s salaries**
- NIH pays salary from direct grant dollars
- VA pays clinician-investigators from VERA dollars except for CDA awardees
- VA Career Development Awardees’ salaries come directly to the hospital

*HH Birdsall MD PhD  ACOS R/D MEDVAMC Houston*
*May 1, 2006                                             1*

## VERA dollars 

**(Veterans Equitable Resource Allocation)**** **
**cover salary, administrative, and facilities costs****.**

*HH Birdsall MD PhD  ACOS R/D MEDVAMC Houston*
*May 1, 2006                                            2*

**VERA Research $ allocation **
**for MEDVAMC in FY06**
**$7,760,758**

## How NIH indirect rates are calculated

- The medical school presents their estimate of expenses to NIH every few years and negotiates an “indirect rate”.
- BCM’s NIH indirect rate is 50% meaning that for every $100 of grants, NIH sends $50 to BCM to cover indirect expenses.
- Industry and foundation grants are charged lower indirect rates.

*HH Birdsall MD PhD  ACOS R/D MEDVAMC Houston*
*May 1, 2006                                            3*

## How VERA Research $ are calculated

**Grant expenditures** (i.e., money spent on test tubes and technician salaries) are summed.
- The sum includes:
**	****100%**** of VA**-administered grant expenditures
**	****75%**** of NIH/**other federal, and national
- 			 foundation grant expenditures
**    ****25%**** of industry**-sponsored grant expenditures
- The sum is multiplied by **43.3%** to get the VERA Research allocation.
- 43.3% is the current rate; it has dropped 15% over the past five years.

*HH Birdsall MD PhD  ACOS R/D MEDVAMC Houston*
*May 1, 2006                                             4*

## How VERA Research $ are calculated

- For NIH, industry, and foundation grants, only the % of the grant expenditures related to MEDVAMC as a performance site contribute towards VERA dollars.
- i.e., if you list the VA as 50% performance site, then only 50% of the grant expenditures count towards VERA dollars.
- An NIH grant that does not use the VA as performance site does not count towards VERA research dollars, even if the investigator is VA-paid.
- VERA research dollars are _not_ based on the % effort that you list on your grant

*HH Birdsall MD PhD  ACOS R/D MEDVAMC Houston*
*May 1, 2006                                             5*

## VERA Research dollars	

- Based on expenditures from grants using VA as performance site
- Based on data from 2 yrs ago
- Covers facilities, administrative and clinician salary costs
- Rate = 43.3% (and dropping)
- Based on discounted % of grant expenditures

*HH Birdsall MD PhD  ACOS R/D MEDVAMC Houston*
*May 1, 2006                                           6*

**Comparison of NIH indirects and VERA dollars**

**NIH indirect dollars**
- Same
- Current year
- Covers facilities and administrative costs
- Rate = 50%
- Based on full amount of grant