Federal Research Grants: Opportunities Remain for Agencies to Streamline Administrative Requirements
Released: 2016-07-22T00:00:00

Letter

Background

More than two dozen federal agencies use grants and other mechanisms to fund research at universities and colleges, as well as at other nonprofit and for-profit organizations, in support of agency missions related to public health, energy security, and space exploration, among others. NIH provides more than half of all federal funds for university and college research, and NSF, DOE, NASA, and other agencies provide the remaining funding (see fig. 1).

OSTP is responsible for advising the President on the federal budget for research and shapes research priorities across agencies with significant portfolios in science and technology. OSTP also helps develop and implement government-wide science and technology policies and coordinate interagency research initiatives. OMB is responsible for developing government-wide policies to ensure that grants—including grants for research and for other purposes such as housing, education, transportation, and health care—are managed properly and that grant funds are spent in accordance with applicable laws and regulations. For decades, OMB has published guidance in various circulars to aid grant- making agencies with such subjects as record keeping and the allowability of costs, which for research grants may include researcher salaries and wages, equipment, travel, and other costs. Congress may pass laws establishing additional reporting and oversight requirements on grant-making agencies and grantees. Funding agencies implement these requirements through regulations, agency guidance, and the terms and conditions of grant awards. In addition, funding agency offices of inspector general may conduct audits to evaluate grantee compliance with requirements. When audits result in findings of noncompliance, such as grantees charging unallowable costs to grants, grantees may need to repay funding agencies for these costs.

Competitively awarded federal research grants generally follow a life cycle comprising various stages—pre-award, award, post-award implementation, and closeout. For competitive research grant programs, in the pre-award stage, a funding agency notifies the public of the grant opportunity through an announcement, and potential recipients submit applications for agency review. In the award stage, the agency identifies successful applicants and awards funding. The post-award implementation stage includes payment processing, agency monitoring, and recipient reporting, which may include financial and performance information. Grant closeout includes preparation of final reports and financial reconciliation. Over this life cycle, applicants and recipients must complete various administrative tasks in order to comply with OMB and funding agency requirements, particularly in the pre-award and post- award implementation stages. See figure 2 for an overview of the administrative tasks associated with our nine selected categories of requirements across the grant life cycle.

Stakeholder organizations representing universities and federal agencies have raised concerns about the administrative workload and costs for complying with federal research requirements, and they have issued several reports with recommendations for agencies to modify requirements in order to achieve their goals while reducing administrative workload and costs. For example, in 2012, the Federal Demonstration Partnership surveyed principal investigators of federally funded research projects. The report on this survey found that principal investigators estimated they spent, on average, 42 percent of their time meeting requirements—including those associated with pre- and post-award administration and preparation of proposals and reports—rather than conducting active research. However, the survey did not specify how much of this time was due to administrative tasks driven by university- specific processes or policies rather than federal requirements, or to nonadministrative tasks that contribute to the scientific aspects of the research, such as writing scientific material for proposals and reports. In addition, the survey did not include universities’ administrative research staff members, who help universities comply with federal and other administrative requirements on research awards. In March 2013, the National Science Board issued a request for information to identify which federal agency and institutional requirements contribute most to principal investigators’ administrative workload, and conducted a series of roundtable discussions with faculty and administrators. The board found that the most frequently cited areas associated with high administrative workload included financial management, the grant proposal process, progress and other outcome reporting, and personnel management, among others.

There has been a series of legislative and executive goals and directives for agencies to simplify aspects of the grants management life cycle and minimize administrative burden for grantees, particularly those that apply for and obtain grants from multiple federal agencies. Table 1 lists several of these goals and directives related to streamlining administrative grant requirements.

There have also been several recent directives intended to strengthen accountability over federal funds. For example, Executive Order 13520 of November 20, 2009 adopts a set of policies for transparency and public scrutiny of significant payment errors throughout the federal government and for identifying and eliminating the highest improper payments.

In response to such streamlining and accountability directives, in December 2013, OMB consolidated its grants management circulars into a single document, the Uniform Guidance. The requirements in the Uniform Guidance apply broadly to different types of grantees—including state, local, and tribal governments, institutions of higher education, and nonprofit organizations—and different types of grants—including grants for research or other purposes. The Uniform Guidance is implemented through individual federal agency regulations that were to take effect no later than December 26, 2014. When issuing the final guidance, OMB stated that it would (1) monitor the effects of the reforms in the Uniform Guidance to evaluate the extent to which the reforms were achieving their desired results for streamlining and accountability and (2) consider making further modifications as appropriate.

OMB’s Government- Wide Requirements Generally Govern the Proper Use of Grant Funds, and Agency- Specific Requirements Generally Govern Research Quality and Effectiveness

Selected administrative requirements in OMB’s government-wide grant guidance generally focus on protecting against waste, fraud, and abuse of funds. These include requirements we selected related to competing and documenting purchases, documenting personnel expenses, preparing and managing project budgets, reporting on subawards, and monitoring subrecipients. Selected administrative requirements in agency-specific guidance generally focus on promoting the quality and effectiveness of federally funded research. These include requirements related to developing and submitting biographical sketches; mentoring and developing researchers; identifying, reporting, and managing financial conflicts of interest; and managing and sharing research data and results.

Selected Administrative Requirements in OMB’s Government-Wide Grant Guidance Generally Focus on Protecting against Waste, Fraud, and Abuse of Funds

OMB developed the Uniform Guidance to (1) streamline OMB’s guidance for federal awards to ease administrative burden and (2) strengthen oversight of federal funds to reduce risks of waste, fraud, and abuse. OMB developed the Uniform Guidance over more than 2 years, and it reflects input from federal agencies, auditors, and recipients of federal awards, which OMB solicited in an effort to balance its dual goals of streamlining and accountability. The Uniform Guidance includes provisions related to a range of administrative requirements on research grants, including ones we selected related to competing and documenting purchases, documenting personnel expenses, preparing and managing project budgets, subaward reporting, and subrecipient monitoring. OMB required each individual funding agency to implement the Uniform Guidance by adopting regulations that apply to the agency’s awards. See appendix II for additional information on selected requirements in the Uniform Guidance.

The requirements in the Uniform Guidance aim to protect against waste, fraud, and abuse in various ways, as follows.

Budgets. Funding agencies implement Uniform Guidance requirements for budget preparation and management by designing forms and processes to review applicants’ requests for funding, and grantees’ use of funding, to determine, among other things, whether costs are allowable. These requirements allow for identification of questionable requests for funding in applications or unallowable post- award charges to grants.

Personnel expenses. To document personnel expenses, grantees must maintain a system of internal controls over their records used to justify the costs of salaries and wages so these records accurately reflect the work performed. Salary and wage costs generally represent the largest portion of expenditures on research grants according to agency officials, and NSF and HHS offices of inspector general have reported on the need for oversight to prevent improper or fraudulent salary charges. For example, the NSF Office of Inspector General has documented instances of researchers charging their full-time salaries to federal grants at one university while simultaneously working full- time at another university or for-profit company.

Purchases. To meet documentation requirements for purchases made with grant funds, grantees must maintain records detailing the procurement history for all purchases. Funding agencies and their inspectors general use such purchasing records for oversight, including detection and prosecution of fraudulent purchases. Audit reports by the NSF and HHS offices of inspector general have found instances of researchers using grant funds for personal purchases. In addition, the Uniform Guidance requires that purchases be conducted in a manner providing full and open competition, and establishes five methods for purchasing goods or services. These methods include obtaining price or rate quotations, competitive bids, or competitive proposals for certain purchases.

Subrecipients. Universities frequently collaborate with and provide federal research funds to other institutions, domestic and foreign, through subawards. Awarding agencies rely on grantees to monitor subrecipients to ensure that they use research funds for authorized purposes and stay on track to meet performance goals. In addition, requirements for grantees to report on their subawards provide agencies, Congress, and the public more information on subrecipients' use of taxpayer dollars.

Selected Administrative Requirements in Agency- Specific Guidance Generally Focus on Promoting the Quality and Effectiveness of Federally Funded Research

Funding agencies have established administrative requirements—in some cases, in response to directives from Congress and OSTP—to promote the selection and development of qualified researchers, protect against bias in the conduct of research, and improve access to research results. Agencies implement these requirements through their grants guidance documents and the terms and conditions of their awards. See appendix II for additional information on selected agency-specific requirements.

Promoting the selection and development of qualified researchers. Funding agencies require applicants to submit biographical sketches so the agencies have information they need to select well-qualified researchers. All four funding agencies in our review have agency-specific requirements for biographical sketches in their grants guidance, including requirements for applicants to list information about past publications and current and prior academic or professional positions. Also, to promote the professional development of researchers, two of the four agencies have requirements related to researcher development or mentoring plans. First, as directed in the America Creating Opportunities to Meaningfully Promote Excellence in Technology, Education, and Science Act of 2007, NSF requires that all proposals with postdoctoral researchers include a plan describing the mentoring to be provided to these researchers. Second, NIH encourages institutions to use individual development plans to identify and promote the career goals of graduate students and postdoctoral researchers associated with NIH awards, and requires grantees using individual development plans to describe their use of these plans in annual progress reports.

Protect against bias in the conduct of research. NASA, NIH, and NSF have implemented financial conflict of interest requirements to help protect against bias in the conduct of research, and DOE is in the process of establishing such requirements. For example, NIH and NSF require researchers to disclose and universities to review financial interests to identify potential conflicts, such as investments in or income from entities that might benefit from a research project. Since 1995, NIH-funded researchers have been subject to HHS financial conflict of interest regulations designed to promote objectivity. HHS revised its regulations in 2011 to address the growing size and complexity of biomedical and behavioral research and corresponding concerns about financial ties between researchers and industry—including pharmaceutical, medical device, and biotechnology companies. For example, congressional committee investigations had found cases of financial conflicts of interest that may have led to bias in NIH-funded research, including researchers failing to disclose substantial payments from drug and medical device companies. Similarly, in implementing its financial conflict of interest policy in 1994, NSF stated that it encourages the involvement of researchers and educators with industry and private entrepreneurial ventures but recognizes that these interactions are accompanied by an increased risk of conflicts of interest—a risk that its policy was intended to address.

Improve access to research results. In 2013, OSTP directed federal agencies to support increased public access to the results of federally funded research, including results published in peer-reviewed journals as well as digital data. According to the OSTP directive, policies that provide greater access to peer-reviewed publications and scientific data maximize the impact and accountability of the federal research investment. In response to this directive, agencies established requirements for researchers to develop and comply with data management plans that describe the scientific data to be collected and how the researcher will provide access to and reliable preservation of the data. All four funding agencies in our review require applicants to include data management plans in their proposals.

Selected Universities Identified Common Factors That Add to Their Workload and Costs for Complying with Selected Administrative Requirements

Selected universities and stakeholder organizations identified common factors that add to their administrative workload and costs for complying with selected requirements: (1) variation in agencies’ implementation of requirements, (2) detailed pre-award requirements for applicants to develop and submit documentation for grant proposals, and (3) increased prescriptiveness of certain requirements.

Variation in Funding Agencies’ Implementation of Administrative Requirements

At all six universities we selected for our review, officials told us that variation in funding agencies’ implementation of certain administrative requirements included in our review contributes to workload and costs. For example, they said variation contributes to universities’ costs because they have to design and implement multiple processes and may need to invest in electronic systems to comply with agencies’ requirements, and it contributes to the workload of researchers and administrative staff because they must spend time learning the different requirements, processes, and systems.

Officials we interviewed from stakeholder organizations and the six universities cited variation in funding agencies’ implementation of three categories of requirements in particular as adding to administrative workload and costs: developing and submitting biographical sketches; identifying, reporting, and managing financial conflicts of interest; and preparing and managing project budgets. For example, the biographical sketches agencies require applicants to submit differ in formatting as well as in content, including the information applicants must provide on past publications, research collaborators, and academic positions. In addition, agencies’ financial conflict of interest requirements differ in the types of financial interests that researchers must disclose to their institutions, the information that institutions must report to agencies, and requirements for training researchers on conflicts of interest. Agency implementation of budget preparation and management requirements differs in several ways, including the forms and level of detail required in proposed budgets and the systems for grantee financial reporting. In 2014, the National Science Board reported that faculty and administrative staff participating in roundtable discussions and responding to its request for information cited a lack of consistency and standardization within and among agencies in all aspects of grant management—including regulations, guidance, reporting requirements, forms and formatting, and electronic systems—as a substantial source of administrative workload and costs, resulting in a loss of research time. Appendix III provides detailed examples of the differences in agencies’ implementation of selected requirements.

University officials we interviewed cited specific examples of increases in administrative workload and costs that resulted from variation in funding agencies’ implementation of requirements:

Electronic systems costs. Universities have invested in electronic grant management systems for submitting grant applications and ensuring compliance with multiple agencies’ application requirements. Variations in requirements can make it more difficult for applicants to comply, and applications can be rejected for noncompliance, including noncompliance with formatting requirements such as page lengths or fonts. Universities’ systems help minimize such rejections by identifying noncompliant application elements prior to submission, according to university officials. To address variation between NIH’s and NSF’s conflict of interest requirements, five universities in our review updated their electronic systems, for example, to allow researchers and administrative staff to differentiate the types and thresholds for financial interests required to be disclosed by different agencies, according to university officials.

Administrative staff workload and costs. Officials from the six universities in our review cited examples of investments in administrative staff that they made in part to address variation in agencies’ implementation of requirements. For example, according to officials we interviewed, four universities in our review employ specific administrative staff members with specialized expertise in the policies and procedures of particular agencies to review proposals and help ensure compliance with those agencies’ requirements. Universities’ administrative staff members may also in some cases manage proposal processes for multiple agencies, so the universities need to help them build and maintain expertise in the agencies’ various application systems and requirements, according to officials.

Researcher workload. Officials at the six universities in our review said that researchers must spend time learning different agencies’ requirements and customizing and reformatting application materials for different agencies. For example, according to officials at the six universities, researchers spend time customizing the content, format, and length of biographical sketches to agency-specific requirements and learning how to comply with each agency’s policies on what information to include in proposed budgets.

Detailed Pre-Award Administrative Requirements

Funding agencies require researchers to prepare detailed documentation—including proposed budgets, biographical sketches, information on subawards, data management plans, and in some cases information on conflicts of interest and researcher mentoring and development plans—and submit it to university administrators and agencies as part of the application process. Agencies require much of this information to help them select proposals for funding, according to agency officials and guidance. According to university officials we interviewed, developing this documentation is time-consuming and adds to universities’ administrative workload and costs. Moreover, the likelihood of an agency selecting a proposal for funding is relatively low. For example, in fiscal year 2015, NIH awarded funding to 18 percent of applicants and NSF awarded funding to 24 percent of applicants—similar to funding rates from other years. As a result, for most grant proposals, universities’ investment of time and resources does not result in their receiving research funding.

According to officials from five of our selected universities, as well as reports from stakeholder organizations, pre-award requirements are one of the main sources of frustration and administrative workload and costs among researchers and administrative staff. The National Science Board reported in 2014 that faculty responding to its request for information cited the proposal and submission process, including preparing supporting documentation, as one of the grants management areas that contributed most to their administrative workload. For example, in response to the National Science Board’s request for information, the Federation of American Societies for Experimental Biology surveyed researchers, lab workers, and administrative staff and found that the respondents cited grant proposal preparation and submission as the greatest source of administrative burden out of 15 categories of burden in the survey.

Researchers and administrative staff at the six universities in our review told us that during the pre-award stage, there can be a relatively high level of uncertainty about specific details of a research project, including detailed budget information about potential vendors or travel costs, expected research data and results, and planned contributions by postdoctoral or graduate researchers. They said that complying with agencies’ requirements to prepare and submit documents at a stage when these details remain uncertain is not an efficient use of their time. Similarly, the Federation of American Societies for Experimental Biology reported that difficulty in accurately predicting detailed research budgets when submitting a proposal was specifically raised as a source of administrative burden in comments on its survey.

Administrative Requirements That Have Become More Prescriptive

Recent OMB and HHS policy reforms have resulted in changes to selected requirements that have made them more prescriptive from the standpoint of universities and that, according to university officials, have added to their universities’ administrative workload and costs. Specifically, the Uniform Guidance—which was intended in part to better protect against waste, fraud, and abuse of grant funds—included revised requirements for competition and documentation of purchases that were more prescriptive than those in OMB’s prior circular that applied to universities. In addition, in 2011, HHS revised regulations governing financial conflicts of interest—which apply to research funded by NIH and several other HHS agencies—to address concerns about the objectivity of the research it funds. These revisions included more prescriptive requirements for, among other things, the types of financial interests researchers must disclose. See table 2 for requirements that have become more prescriptive under recent reforms.

Officials at universities in our review stated that the more prescriptive requirements add to universities’ workload and costs when, for example, new or updated systems and processes must be implemented. Officials cited the following examples of needing to implement new or updated systems and processes to comply with the more prescriptive requirements:

Officials at all six universities told us that they expect the new purchasing competition and documentation requirements—particularly the new micropurchase threshold for obtaining price or rate quotations from multiple vendors—will result in added costs for updating their electronic purchasing systems. For example, prior to the Uniform Guidance, five of the universities in our review told us that they had established a higher threshold than the Uniform Guidance for obtaining multiple quotations, and that there will be a large increase in the number of transactions exceeding the new threshold. The grantee community raised concerns to OMB about not being adequately prepared to comply with the more prescriptive purchasing requirements, and OMB delayed implementation of the purchasing requirements for 2 years.

Five of the universities in our review developed and implemented a new electronic system to comply with NIH’s revised conflict of interest requirements, according to university officials. Similarly, officials from the Association of American Medical Colleges who are studying the effect of NIH’s conflict of interest requirements told us that institutions have reported incurring costs to implement processes and systems, such as financial interest-tracking software, to comply with the new requirements.

Universities have had to hire and train staff to comply with more prescriptive requirements, according to officials at the six universities in our review. Officials at four universities said they expect to hire staff to handle the added workload resulting from an increased volume of purchases subject to OMB’s revised purchasing competition and documentation requirements. In addition, officials from all six universities said that they provided additional training to researchers on NIH’s conflict of interest requirements—as required by the revised rule—and officials from three universities said that each university hired an additional administrative staff member to manage the overall process for reviewing and reporting on financial conflicts of interest.

In contrast with its revised purchasing requirements, OMB largely maintained existing subrecipient monitoring requirements in the Uniform Guidance. Nevertheless, according to officials from universities and stakeholder organizations we interviewed, the prescriptive nature of the subrecipient monitoring requirements adds to universities’ administrative workload and costs. Under these requirements, grantees have the flexibility to conduct some monitoring activities, such as on-site reviews or subrecipient training, as they determine appropriate based on their assessment of a subrecipient’s risk of misusing grant funds. However, the Uniform Guidance requires grantees to (1) follow-up and ensure that every subrecipient, regardless of risk, take timely and appropriate action on all deficiencies pertaining to the subaward detected through audits, on- site reviews, and other means, and (2) issue management decisions for such deficiencies. University officials we interviewed said that to meet these requirements, they may have to review audits of hundreds of subrecipients each year, including lengthy audits of state governments for subawards provided to public universities. Officials from universities and stakeholder groups we interviewed said that much of the administrative workload and costs for complying with the audit review and follow-up requirements is unnecessary, particularly for low-risk subrecipients such as those with histories of successfully conducting federally funded research.

In some cases—particularly for universities subject to state requirements—the revised requirements did not substantially add to universities’ administrative workload and costs. The three public universities in our review have had to comply with state requirements related to purchasing or conflicts of interest that were already more stringent than federal requirements in some ways. For example, officials at one public university told us that the university was well-positioned to comply with NIH’s conflict of interest requirements because it already had processes in place to comply with more stringent state conflict of interest requirements.

Agency officials said that some of universities’ administrative workload and costs may be due to their interpretations of requirements that are stricter than agencies intended. For example, OMB staff said grantees do not have to review audits of subrecipients’ full financial statements and internal controls systems, since the Uniform Guidance requires grantees to follow up and issue management decisions only for audit findings that are related to their subaward. However, officials from universities and stakeholder groups said that universities are concerned that they need to interpret and comply with requirements to the standards they believe agency inspectors general may apply in an audit. These officials cited recent audit reports by the HHS and NSF offices of inspector general that found universities had charged unallowable or questionable costs to research grants. Some of these audit findings stemmed from differences in how auditors, agencies and universities interpreted requirements.

OMB and Funding Agencies Have Made Continuing Efforts to Reduce Universities’ Administrative Workload and Costs, with Limited Results

OMB and the four research funding agencies in our review have made continuing efforts to reduce universities’ administrative workload and costs for complying with selected requirements. These efforts have included (1) standardizing requirements across agencies, (2) streamlining pre-award requirements, and (3) in some cases allowing universities more flexibility to assess and manage risks for some requirements. In each of these areas, OMB and agency efforts have resulted in some reductions to administrative workload and costs, but these reductions have been limited.

OMB and Funding Agency Efforts to Standardize Some Administrative Requirements Have Not Fully Addressed Variations

OMB and funding agencies have made several efforts to reduce grantees’ administrative workload and costs by standardizing selected requirements, in accordance with federal goals, and several of these efforts are ongoing. The Federal Financial Assistance Management Improvement Act of 1999 was enacted in part to improve the effectiveness and performance of federal financial assistance programs and facilitate greater coordination among those responsible for providing such assistance. For example, the act, which expired in 2007, required agencies to establish a common application reporting system, including uniform administrative rules for federal financial assistance programs. More recently, Executive Order 13563 called for agencies to coordinate and harmonize regulations to reduce compliance costs. In addition, in 2003 OSTP established the Research Business Models working group (RBM)—which consists of officials from DOE, NASA, NIH, NSF, and other federal research funding agencies—to facilitate coordination across these agencies. RBM’s charter calls for it to examine opportunities and develop options to unify agency research grants administration practices, and to assess and report periodically on the status, efficiency, and performance of the federal-academic research partnership.

In accordance with such federal goals, OMB-led efforts to standardize selected requirements—particularly requirements for budget preparation and management—include the following:

Grants.gov. In 2003, OMB created Grants.gov—a common website for federal agencies to post discretionary funding opportunities and for grantees to find and apply for them. Intended in part to simplify the grant application process and save applicants costs and time, Grants.gov allows for standard government-wide submission processes and forms for research grants.

Standardization of financial and performance reporting forms. As discussed previously, in December 2013, OMB consolidated its grants management guidance into a single document, the Uniform Guidance, which established standard requirements for financial management of federal awards across the federal government. In particular, it generally requires the use of OMB-approved government-wide standard forms for reporting financial and performance information.

Digital Accountability and Transparency Act pilot program. The Digital Accountability and Transparency Act of 2014 requires OMB to establish a pilot program to identify ways to standardize financial and other information that recipients of federal awards are required to report to agencies across the government, among other things. This pilot is ongoing and includes testing approaches to (1) allow grant recipients to submit financial reports in one central system and (2) develop consistent government-wide financial and other terms and definitions to simplify recipient reporting and help agencies create information collection forms.

In addition, research funding agencies have led several efforts through RBM to standardize selected requirements, including the following:

Federal research terms and conditions. In 2008, RBM developed a standard core set of administrative terms and conditions for research grants, which implemented OMB’s grants management guidance in effect at that time. The research terms and conditions included standard provisions related to some selected post-award requirements, such as budget management and financial reporting. In 2014, RBM began a process to develop a revised set of standard terms and conditions to apply to research grants subject to OMB’s revised requirements under the Uniform Guidance. Agency officials said they estimate that the revised standard terms and conditions will be issued in late 2016 or early 2017.

Research Performance Progress Report. In 2010, RBM issued, and OSTP and OMB directed agencies to implement, the Research Performance Progress Report, a uniform format for post-award performance reporting for federally funded research projects. The report is intended to reduce recipients’ administrative workload by standardizing the types of information required in interim performance reports, such as budget information. In 2015, RBM drafted a revised version of the Research Performance Progress Report, which is to be used for both interim and final reports.

SciENcv. In 2013, research funding agencies worked under RBM’s direction to develop SciENcv, a central electronic portal where researchers can assemble biographical information, intended to reduce the administrative workload and costs associated with creating and maintaining federal biographical sketches. Initially designed for NIH applications, SciENcv is currently being expanded to allow researchers to generate and maintain biographical sketches for multiple agencies, including NSF, in the formats required by those agencies.

See appendix IV for more information on OMB and funding agency efforts to standardize selected administrative requirements.

However, OMB’s efforts to standardize requirements did not fully address the variations in requirements, thereby limiting the potential reductions in universities’ administrative workload and costs. For example, the Uniform Guidance does not prohibit agencies from varying in their implementation of aspects of budget preparation and management requirements. Specifically, as previously discussed, the four funding agencies in our review vary in the forms and level of detail required in proposed budgets, their systems for financial reporting, and other aspects of budget preparation and management requirements.

Similarly, research funding agency and OSTP efforts have not fully addressed variation in requirements. For example, (1) RBM has not initiated a process to standardize pre-award requirements (its standard terms and conditions and Research Performance Progress Report both focus on post-award requirements); (2) SciENcv provides a central system for assembling biographical sketches, but it does not provide standardized formats and content and it has not been adopted outside of NIH and NSF; and (3) RBM’s efforts to standardize research terms and conditions, both prior to and following the issuance of the Uniform Guidance, allow for agency-specific variations. For example, according to officials drafting the revised research terms and conditions, RBM considered establishing a standard 120-day deadline for institutions to submit final reports required for closing out grants—an increase over the 90-day deadline some agencies had previously established. However, the officials said that some agencies indicated they would not increase their closeout deadlines beyond 90 days. The officials said that to gain these agencies’ agreement to use the standard terms and conditions, the terms and conditions will allow deviations from the standard closeout time frames.

According to OMB staff and funding agency officials, several factors can limit agencies’ ability to standardize administrative requirements on research grants. First, funding agencies must comply with differing statutory or other requirements, which can result in differences in their requirements for grantees. For example, NIH must comply with HHS’s regulations on conflict of interest requirements and is limited in how it can change its conflict of interest requirements to align with those of other agencies without HHS amending its regulations. Second, there are differences in the types of research or recipients agencies fund that can limit their ability to standardize requirements. For example, the types of data that research projects generate, and the constraints on sharing such data, can vary depending on the type of research universities are conducting. Researchers may not be able to share personally identifiable medical data as they would other types of data, for instance. These differences can limit agencies’ ability to standardize requirements related to data management and sharing, according to agency officials.

Nevertheless, agencies have opportunities to standardize requirements to a greater extent than they have already done. In particular, they have flexibility in how they implement certain aspects of selected requirements that are not subject to statutory or other requirements or to agency- specific differences in types of research or grant recipients. According to some funding agency officials we interviewed, aspects of requirements where agencies have such flexibility include, for example, the format and content of biographical sketches, the budget forms and content of budget justifications that agencies require in applications, and the types of budget revisions agencies allow grantees to make without obtaining prior approval. Officials at NSF, NIH, and OSTP who co-chair RBM told us that the group has been fully occupied with ongoing efforts related to developing standard research terms and conditions and the Research Performance Progress Report. RBM officials leading these efforts said that they expect them to be complete in late 2016 or early 2017, and that RBM is well suited to pursue further efforts to standardize requirements and to report on its efforts. Such efforts could help ensure that agencies do not miss opportunities to reduce universities’ administrative workload and costs and to improve their oversight of funding and support of research quality.

Funding Agency Efforts to Reduce Pre-Award Administrative Workload and Costs by Postponing Proposal Requirements Have Not Been Extended to All Applicable Grants or Requirements

DOE, NASA, NIH, and NSF have made efforts to reduce pre-award administrative workload and costs associated with proposal preparation by postponing certain requirements until after a preliminary decision about an applicant’s likelihood of funding. These efforts require applicants to provide a limited set of application materials—often referred to as a preliminary proposal—for initial evaluation before possible submission of a full proposal. Preliminary proposals are intended, in part, to reduce applicants’ administrative workload and costs when applicants’ chances of success are very small. Such efforts are in line with RBM’s charter, which calls for agencies to identify approaches to streamline research grants administration practices. Furthermore, several organizations representing federal agencies and university researchers, including the National Science Board and Federation of American Societies for Experimental Biology, have recommended such efforts to streamline proposal processes. For example, according to findings from the National Science Board’s request for information, respondents suggested that much of the information agencies required at proposal submission may not be necessary, and the board recommended that agencies modify proposal requirements to include only information needed to evaluate the merit of the proposed research and make a funding determination.

The funding agencies in our review implement a range of preliminary proposal processes, which can involve postponing requirements related to budget preparation, biographical sketches, data management plans, and researcher mentoring and development plans. For example, NSF’s preliminary proposals generally include a four-page project description and a one-page description of project personnel, among other elements, but may not include budgets, budget justifications, data management plans, or postdoctoral mentoring plans. NIH’s “just–in-time” process allows some elements of an application to be submitted after the application has gone through initial peer review and received a qualifying score from the peer review panel. For example, certain data management plans can be submitted at the just-in-time stage, but other information, such as budgets and biographical sketches, must generally be submitted with the initial application. In some cases, agencies use peer reviewers to evaluate preliminary proposals and make binding decisions as to whether applicants can submit full proposals. In other cases, agency program officers evaluate preliminary proposals and provide feedback either discouraging or encouraging applicants to submit full proposals. See appendix IV for more information on funding agency efforts to streamline selected pre-award administrative requirements through preliminary proposals.

According to university officials, stakeholder organizations, and information from the four funding agencies in our review, efforts to postpone the timing of certain pre-award requirements have generally led to reductions in universities’ administrative workload and costs. For example, one NSF division evaluated its preliminary proposal pilot in 2014, and reported that the pilot led to reduced applicant workload by lessening the number of proposal pages researchers needed to write and simplifying the documents university administrative offices required of applicants, since preliminary proposals do not include budgets. According to NSF data, NSF received approximately 4,900 preliminary proposals in fiscal year 2014 and discouraged or barred applicants from submitting full proposals for more than 3,700 of them. As a result, those applicants avoided the administrative workload and costs of preparing full budgets and other documentation for proposals that would not be funded. Officials from the six universities in our review said that application processes that allow researchers to focus more of their pre-award time developing and describing the scientific and technical aspects of the proposed research were a more efficient use of their time than developing detailed budgets or other information that agencies may not need to make an initial funding decision and that may change by the time the research is conducted. For example, as noted above, staff at the six universities told us that budget details such as potential vendors or travel costs, or other details such as expected research data and results or planned contributions by postdoctoral researchers, are often not known with certainty at the pre- award stage. Similarly, according to findings from the National Science Board’s request for information, respondents suggested that the administrative workload of both applicants and reviewers can be substantially reduced through use of preliminary proposals and other approaches for postponing submission of information.

However, agencies have not extended these pre-award streamlining efforts to all grant solicitations for which they could be used to reduce workload and costs. In addition, for certain requirements, agencies still require documentation that they may not need to effectively evaluate initial proposals. For instance, NIH’s just-in-time process does not generally postpone requirements for proposed budgets, disclosure of significant financial interests, or biographical sketches, among others— requirements that other agencies have determined are not necessary for preliminary proposals. In addition, pre-award streamlining efforts at DOE, NASA, and NSF are limited to certain offices or certain programs within the agencies, in some cases because the efforts are still in pilot phases. Partly in response to the National Science Board’s 2014 recommendations to reduce administrative workload by expanding the use of preliminary proposals or just-in-time submissions, NSF took steps to identify opportunities for expanding pre-award streamlining efforts agency-wide. Specifically, in 2015, NSF senior leadership directed officials from NSF’s directorates to review and identify options to reduce researchers’ administrative workload and costs, including by expanding use of preliminary proposals and by focusing application reviews on a minimum set of elements that are needed to meet NSF’s two merit review criteria: (1) intellectual merit and (2) broader impact, which encompasses the potential benefit to society. As a result of the directive, three NSF directorates expanded their use of preliminary proposals, for instance, by piloting efforts to postpone requirements to submit detailed budgets until proposals are recommended for award. DOE, NASA, and NIH have not conducted similar agency-wide reviews to identify opportunities for reducing administrative workload and costs by expanding their use of preliminary proposals or just-in-time submissions, according to agency officials. Such reviews may help ensure that agencies do not miss opportunities to reduce unnecessary pre-award administrative workload and costs for applicants that do not receive awards.

According to funding agency officials we interviewed, preliminary proposals may not be effective in reducing administrative workload and costs for certain solicitations or certain research grant programs. For example, DOE officials said they do not use preliminary proposals for certain specialized grant programs in fields with a small number of scientists who are likely to apply. Similarly, NSF officials said that preliminary proposals can create additional workload and costs for solicitations where the large majority of applicants go on to submit full proposals. Officials from DOE and NASA also said that researchers value the opportunity for peer review and feedback on their full proposals because it helps them improve their future applications. In addition, agency regulations may establish time frames that prevent postponing certain requirements until a smaller pool of likely awardees has been identified. For instance, under HHS regulations governing NIH’s financial conflict of interest requirements, researchers who have not previously disclosed their significant financial interests must do so no later than the time of application for NIH funds. However, Executive Order 13563 directs agencies to identify and consider regulatory approaches that reduce burdens and maintain flexibility. For research grant requirements, such approaches could include modifying regulations to allow for postponing pre-award requirements. Coordinating and reporting on opportunities agencies have identified for expanded use of preliminary proposals would be in line with RBM’s charter.

OMB and Funding Agency Efforts to Allow More Flexibility Have Not Addressed Some Requirements

OMB and funding agencies have made efforts, in accordance with federal goals, to reduce administrative workload and costs by allowing universities more flexibility to assess and manage risks related to certain administrative requirements. Executive Order 13563 calls for agencies to identify and consider regulatory approaches that reduce burdens and maintain flexibility for the public. Accordingly, one of OMB’s stated objectives for its reforms in the Uniform Guidance was “focusing on performance over compliance for accountability.” For example, in its statements in the Federal Register accompanying the final Uniform Guidance, OMB reiterated its commitment to allow recipients of federal awards the flexibility to devote more effort to achieving programmatic objectives rather than complying with complex requirements, such as by reforming requirements that are overly burdensome. Efforts by OMB and the funding agencies in our review to allow universities more flexibility to assess and manage risks related to administrative requirements— particularly requirements for budget preparation and management and documentation of personnel expenses—include the following:

Expanded authorities. OMB revised its grants guidance in the 1990s to allow “expanded authorities” for grant recipients. The expanded authorities allowed funding agencies to waive requirements for recipients to obtain agencies’ prior written approval before making certain changes to project budgets, such as rebudgeting funds across budget categories and carrying forward unobligated balances to later funding periods. Under RBM’s 2008 standard terms and conditions that implemented that guidance, DOE, NASA, NIH, and NSF waived many requirements for recipients to obtain prior approvals for budget revisions. Agency officials said that since the issuance of the Uniform Guidance they are continuing many of these waivers.

Revised requirements for documenting personnel expenses. In the Uniform Guidance, OMB modified requirements for documenting personnel expenses to focus on establishing standards for recipients’ internal controls over salary and wage expenses, without prescribing procedures grantees must use to meet the standards. OMB expected this change to reduce grantees’ administrative workload and costs by allowing them the flexibility to use internal controls that fit their needs. In 2011, prior to the Uniform Guidance, four universities, in coordination with the Federal Demonstration Partnership and research funding agencies, began piloting a new method for documenting salary and wage charges to federal awards, known as payroll certification. OMB and the offices of inspector general at NSF and HHS agreed that the pilot would include subsequent audits by the offices of inspector general in order to evaluate the results.

Modular budgets. In 1999, NIH implemented modular budgets, which generally apply to all NIH research grant applications requesting up to $250,000 per year. NIH allows recipients to request budgets in $25,000 increments—or “modules”—and decide after receiving an award whether to establish detailed budgets or to continue budgeting in $25,000 increments. In addition, under modular budgets, NIH allows applicants to provide more limited narratives to support certain budget line items than they would provide under non-modular budgets.

See appendix IV for more information on OMB and funding agency efforts to allow flexibility for grantees related to selected administrative requirements.

OMB’s and funding agencies’ efforts to allow universities more flexibility have led to reductions in administrative workload and costs. For instance, officials from the four funding agencies and six universities in our review generally agreed that OMB’s expanded authorities reduced grantees’ administrative workload and costs associated with post-award budget revisions. In addition, officials from both universities in our review that piloted a payroll certification system said that it resulted in over an 80 percent reduction in the number of forms that principal investigators needed to review and corresponding reductions in time needed to develop and process these forms. Officials from both universities also said the time and costs of training staff were lower under the pilot, because fewer people were responsible for certifying payroll reports than had been responsible for certifying effort reports, and the concept of payroll certification is easier to understand than effort reporting. Furthermore, agency inspector general audits of two of the universities participating in the pilot found that the universities’ implementation of payroll certification did not weaken accountability over federal funds for salaries and wages; an audit of the third university was inconclusive, and the fourth audit report had not been issued as of April 2016.

In April 2016, OMB staff said other reforms in the Uniform Guidance also reduced administrative workload and costs by providing universities and other grantees more flexibility. For example, the Uniform Guidance includes provisions specifically allowing the use of fixed amount awards— grant agreements for which accountability is based primarily on performance and results rather than accounting for incurred costs—which OMB staff said can reduce administrative workload and costs, for example, for submission of invoices by the fixed amount award recipient. Also, in the Uniform Guidance, OMB clarified its prior guidance by detailing the conditions under which grantees may directly charge administrative support costs to grants—rather than being reimbursed for these costs as part of their indirect (or overhead) costs. OMB staff said this change reduced administrative workload and costs by better allowing universities to assign administrative staff to specific research projects so that researchers can focus more of their time on the scientific aspects of the projects. However, fixed amount awards and direct charging of administrative support costs were both allowed under certain circumstances prior to the Uniform Guidance, and we did not specifically discuss the reforms with universities, so we do not know to what extent universities believe the reforms reduced their administrative workload and costs.

Despite efforts to allow universities more flexibility, as previously discussed, several administrative requirements—in particular, OMB requirements related to purchases and subrecipients and NIH requirements related to financial conflicts of interest—limit universities’ flexibility and require them to allocate administrative resources toward oversight of lower-risk purchases, subrecipients, and financial interests. These requirements limit universities’ flexibility in the following ways:

Competition and documentation of purchases. In developing the Uniform Guidance, OMB established the micro-purchase threshold— above which grantees must generally obtain price or rate quotations, competitive bids, or competitive proposals—based on the threshold for competition of purchases made under federal contracts. University officials said that prior to the Uniform Guidance, the universities had set their thresholds based on consideration of the potential savings and administrative costs of competition or, in the case of public universities, state requirements. As previously discussed, officials at five of the universities in our review told us that they had each established a higher threshold than the Uniform Guidance for obtaining multiple quotations. Furthermore, officials from the six universities in our review said that for relatively small purchases, the administrative workload and costs associated with competition may outweigh the savings gained.

Monitoring subrecipients. In developing the Uniform Guidance, OMB largely based its subrecipient monitoring requirements on those in its prior guidance and did not provide certain flexibilities to grantees to assess and manage risks. Specifically, the Uniform Guidance allows grantees to use a risk-based approach to monitor subrecipients, but it does not allow a risk-based approach to following up on audit findings that pertain to the subaward. The requirement for a university to follow up on audit findings is not risk based in that it applies to all subrecipients, regardless of their risk as assessed by the university. Officials we interviewed from the six universities in our review and stakeholder organizations generally agreed that administrative resources spent reviewing and following up on audits of low-risk subrecipients, such as those that have long track records of conducting federally funded research, could be better targeted on monitoring higher-risk subrecipients. These officials also noted that because the Uniform Guidance requires universities to review financial and performance reports and perform other project-level oversight of subrecipients, following up on audit findings may result in little added protection against improper use of funds and poor performance. OMB staff said that they have drafted an audit reporting form that universities can use to reduce the workload of reviewing subrecipients’ audit reports. However, the form had not been issued as of April 2016, and the draft form does not change the requirement for universities to follow up on audit findings for all subrecipients, regardless of risk.

Identifying and managing researcher financial conflict of interest. Under the HHS regulations governing NIH’s conflict of interest requirements, researchers must disclose to their institution a range of financial interests held by them, their spouses, or their dependent children. These financial interests include investments in or income from a company involved in similar research, patents or copyrights that generate income for the researcher, or reimbursed or sponsored travel, among others. These different types of financial interests vary in the frequency with which they occur and in the risk they might pose to the integrity of the NIH-funded research. Officials we interviewed from the six universities in our review and stakeholder organizations generally agreed that the additional financial interests that must be disclosed and reviewed under the revised requirements—particularly reimbursed or sponsored travel costs, which officials said are common among academic researchers—rarely result in identification of actual conflicts that could bias their research.

OMB, in developing the Uniform Guidance, and HHS, in developing the financial conflict of interest regulations that apply to NIH awards, each went through multiyear public rule-making processes and incorporated input from a range of stakeholders concerned about administrative workload and costs as well as accountability and research integrity. OMB plans to evaluate the guidance’s overall impact on burden and waste, fraud, and abuse by January 2017 to identify opportunities to enhance its effectiveness. Similarly, as stated in the final rule for its conflict of interest regulation, HHS plans to evaluate the effects of certain provisions of the regulation. Since issuing these rules, OMB and HHS, as well as stakeholder organizations, have begun collecting information on the effects of the rules that the agencies can use in their evaluations. OMB directed agencies to report, beginning in January 2015, information on their implementation of the Uniform Guidance, including metrics on the overall impact on burden and waste, fraud, and abuse. In addition, the Federal Demonstration Partnership has gathered information from member universities to report to OMB on how the Uniform Guidance purchasing requirements will affect universities’ administrative workload and costs. Similarly, the Association of American Medical Colleges has gathered information from its member institutions on how HHS’s new regulation has affected their administrative workload and costs for disclosing and reviewing financial interests, and how it has affected the number of actual conflicts of interest institutions have identified. The additional information agencies and stakeholder organizations are gathering could allow OMB and HHS to more fully consider the requirements’ effects on universities’ administrative workload and costs and balance such considerations against the requirements’ added protections for accountability and research integrity.

Federal standards for internal control call for agencies to identify risks, analyze them to estimate their significance, and respond to them based on their significance and the agency’s risk tolerance. The standards also state that management may need to conduct periodic risk assessments to evaluate the effectiveness of risk response actions. Neither OMB nor HHS has specified whether its evaluation of the Uniform Guidance and financial conflict of interest regulations, respectively, will include evaluating options for targeting requirements on areas of greatest risk, particularly in the areas of competing and documenting purchases, monitoring subrecipients, or identifying and managing research conflict of interest. Evaluating such options could help universities focus administrative resources on areas of highest risk and allow researchers to maximize the time spent on conducting research versus completing administrative tasks.

Conclusions

OMB and research funding agencies—in response to congressional or executive directives—have established administrative requirements on research grants. Such requirements help to protect against waste, fraud, and abuse of funds and to promote the quality and effectiveness of federally funded research, but they also create administrative workload and costs for universities. OMB and funding agencies have made a number of efforts to reduce workload and costs—such as by standardizing requirements across agencies, streamlining pre-award requirements, and allowing universities more flexibility to manage risks— and have had some success.

However, opportunities remain for research funding agencies to achieve additional reductions in administrative workload and costs while still protecting against waste, fraud, and abuse. RBM—whose charter calls for it to examine opportunities and develop and report on options to unify and streamline agency research grants administration practices—is well suited to pursue such efforts. First, agencies have opportunities to standardize requirements through RBM to a greater extent than they have already done, by addressing variations in budget forms, biographical sketches, and conflict of interest requirements, among others. Such standardization could reduce universities’ administrative workload and costs associated with investing in systems and spending researcher and administrative staff time learning and complying with agencies’ varying requirements. Second, NSF senior leadership has called for an agency- wide review to identify options for expanding preliminary proposals or other pre-award streamlining efforts, but DOE, NASA, and NIH have not called for similar reviews. Agency-wide reviews to identify opportunities to use preliminary proposals or similar approaches where applicable could reduce administrative workload and costs associated with proposal preparation, particularly for the large majority of applicants that do not receive awards.

Opportunities also remain for OMB and HHS to reduce administrative workload and costs by allowing universities more flexibility to assess and manage risks related to certain administrative requirements, as they have already done with requirements for documenting personnel expenses and preparing and managing budgets and as called for in federal streamlining directives. Specifically, (1) OMB’s planned evaluation of the Uniform Guidance presents an opportunity for OMB to consider targeting requirements for purchasing and subrecipient monitoring on areas of greatest risk to proper use of research funds and (2) HHS’s planned evaluation of its revised conflict of interest requirements presents an opportunity for HHS to consider targeting conflict of interest requirements on areas of greatest risk to research integrity. By evaluating options for targeting these requirements, OMB and HHS may identify ways to reduce universities’ administrative workload and costs while maintaining accountability over grant funds.

Recommendations for Executive Action

We are making four recommendations for identifying and pursuing opportunities to streamline administrative requirements on research grants to universities.

To further standardize administrative research requirements, the Secretary of Energy, the NASA Administrator, the Secretary of Health and Human Services, and the Director of NSF should coordinate through OSTP’s Research Business Models working group to identify additional areas where they can standardize requirements and report on these efforts.

To reduce pre-award administrative workload and costs, particularly for applications that do not result in awards, the Secretary of Energy, the NASA Administrator, and the Secretary of Health and Human Services should conduct agency-wide reviews of possible actions, such as further use of preliminary proposals, to postpone pre-award requirements until after a preliminary decision about an applicant’s likelihood of funding and, through OSTP’s Research Business Models working group, coordinate and report on these efforts.

To better target requirements on areas of greatest risk, while maintaining accountability over grant funds, the Secretary of Health and Human Services, as part of the planned evaluation of the HHS regulation governing financial conflicts of interest in NIH-funded research, should evaluate options for targeting requirements on areas of greatest risk for researcher conflicts, including adjusting the threshold and types of financial interests that need to be disclosed and the timing of disclosures, and the Director of OMB, as part of OMB’s planned evaluation of the Uniform Guidance, should evaluate options for targeting requirements for research grants to universities, including requirements for purchases and subrecipient monitoring, on areas of greatest risk for improper use of research funds.

Agency Comments and Our Evaluation

We provided a draft of this report to DOE, HHS, NASA, NSF, OMB, and OSTP. DOE, HHS—responding on behalf of NIH—and NASA provided written comments, which are reproduced in appendixes V, VI, and VII, respectively, and NSF and OMB provided oral comments. DOE, HHS, and NASA generally concurred with our findings and recommendations and provided specific comments which we discuss in more detail below. NSF and OMB did not comment on our recommendations. DOE, HHS, NSF, and OMB also provided technical comments, which we incorporated as appropriate.

DOE, HHS, and NASA concurred with our first recommendation to coordinate through RBM to identify additional areas where they can standardize requirements. In their comments, the agencies said they would continue to build on RBM’s previous efforts to standardize requirements and report on their efforts according to RBM’s charter. NSF did not formally state whether it concurred with the recommendation, but NSF officials told us that research funding agencies already coordinate effectively through RBM and other groups, on such efforts as the standard research terms and conditions and the Research Performance Progress Report. However, these current efforts are expected to be complete in late 2016 or early 2017, and we continue to believe that agencies have opportunities to standardize requirements in areas that have not yet been addressed by current efforts, and achieve additional reductions in administrative workload and costs while still protecting against waste, fraud, and abuse.

DOE and HHS concurred, and NASA partially concurred, with our second recommendation to conduct agency-wide reviews of possible actions to postpone pre-award requirements until after a preliminary decision about an applicant’s likelihood of funding. DOE stated that it would review pre- award requirements and coordinate through RBM to define actions to be taken to reduce burdens of these requirements, and HHS stated that NIH will review what components of grant applications are strictly needed to provide information for balanced and fair review and funding considerations, and what components can be added to the information requested during the just-in-time stage. In its technical comments, HHS stated that in 2014, NIH charged its Scientific Management Review Board to conduct an evaluation to recommend ways to further optimize the process of reviewing, awarding, and managing grants and maximize the time researchers can devote to research. In line with our second recommendation, the Board’s report also found that the use of preliminary proposals could be expanded and included a recommendation that NIH pilot test preliminary proposals. In its comments, NASA agreed to review existing documents and reports to identify best practices that postpone pre-award requirements, but stated that program offices should determine whether or not these practices are in the best interest of the program mission. We acknowledge in our report that preliminary proposals may not be effective in reducing administrative workload and costs for certain research grant programs or solicitations, and our recommendation allows for program offices to use discretion in determining what actions to take, if any, to postpone pre-award requirements until after a preliminary decision about an applicant’s likelihood of funding.

HHS concurred with our third recommendation to evaluate options for targeting its financial conflict of interest requirements on areas of greatest risk for researcher conflicts. HHS stated in its comments that it has partnered with the Association of American Medical Colleges to measure the effectiveness of the financial conflict of interest requirements and identify areas that may create administrative burden.

OMB did not formally state whether it concurred with our fourth recommendation to evaluate options for targeting requirements for purchases and subrecipient monitoring on areas of greatest risk for improper use of research funds. However, OMB staff told us that they agree that opportunities remain for streamlining administrative requirements. In addition, in technical comments on our draft, OMB staff stated that its grants policy applies to all types of grants and recipients— not just research grants to universities. We have revised our report to clarify that OMB’s requirements apply to all types of grants and recipients. With regard to our recommendation, it is important to note that the Uniform Guidance states that OMB may allow exceptions to requirements for classes of federal awards or recipients—for example, when doing so would expand or improve the use of effective practices in delivering federal financial assistance. We believe that our recommendation that OMB evaluate options for targeting requirements for research grants to universities could lead to such improvements for universities and potentially for other types of recipients. In particular, if implemented by OMB, our recommendation could help universities focus administrative resources on areas of highest risk and allow researchers to maximize the time spent on conducting research versus completing administrative tasks.

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If you or your staff members have any questions about this report, please contact me at (202) 512-3841 or neumannj@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this report. GAO staff who made key contributions to this report are listed in appendix VIII.

Appendix I: Objectives, Scope, and Methodology

This report examines (1) the sources and goals of selected research grant requirements, (2) the factors that contribute to universities’ administrative workload and costs for complying with these requirements, and (3) efforts the Office of Management and Budget (OMB) and research funding agencies have made to reduce the administrative workload and costs for complying with these requirements, and the results of these efforts.

To address these objectives, we selected four agencies that fund research grants to universities and focused on nine categories of requirements associated with these agencies’ research grants:

The four funding agencies were the Department of Energy (DOE), National Aeronautics and Space Administration (NASA), National Institutes of Health (NIH) within the Department of Health and Human Services, and National Science Foundation (NSF). We selected NIH and NSF because they are the two largest funders of research at universities and colleges, according to NSF data. We selected DOE and NASA as two agencies providing smaller amounts of research funding, and funding for different types of research, to universities and colleges. According to NSF data, these four agencies provided about 83 percent of federal funding for research at universities and colleges in fiscal year 2015. Our findings from our reviews of these four agencies cannot be generalized to all agencies that fund research.

The nine categories of administrative requirements on research grants were (1) competition and documentation of purchases, (2) documenting personnel expenses, (3) preparing and managing project budgets, (4) subaward reporting, (5) subrecipient monitoring, (6) biographical sketches, (7) financial conflicts of interest, (8) managing and sharing research data and results, and (9) researcher mentoring and development. We chose these requirements based on several factors. In particular, we chose requirements that multiple universities and university stakeholder organizations had cited as contributing to universities’ administrative workload or costs. In addition, we chose requirements that had been the subject of recent streamlining efforts or of recent changes in OMB or funding agency guidance, or that had been part of the findings of recent reports by agency inspectors general on research grants to universities. Our findings from our reviews of these requirements cannot be generalized to all administrative requirements. See appendix II for more information on these requirements, including their definitions, sources, and goals.

To examine the sources and goals of these nine categories of requirements, we reviewed documents related to establishing the requirements and any changes that had been made. These documents included public laws; Federal Register notices and other documentation related to OMB’s development of the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance); and other documentation of government- wide requirements, such as the February 2013 Office of Science and Technology Policy (OSTP) memorandum on increasing access to the results of federally funded scientific research. We also examined DOE, NASA, NIH, and NSF documents related to their implementation of the nine categories of requirements, including agency-specific guidance on grant proposal and award policies and procedures and agency regulations implementing the Uniform Guidance. To ensure the accuracy and completeness of the information we collected, we obtained input from the four agencies in our scope by obtaining their edits and additions to a matrix we prepared summarizing the sources and goals of the nine requirements. For further information, we interviewed OMB staff about the development of the Uniform Guidance, including its provisions specific to university research grants, and we interviewed DOE, NASA, NIH, and NSF officials responsible for developing research grant requirements at their agencies. We also reviewed audit reports issued by the DOE, NASA, NIH, and NSF offices of inspector general related to research grants and the nine categories of requirements included in our scope to determine how the inspectors general apply the requirements, and we interviewed office of inspector general officials from each of the four agencies.

To examine factors that contribute to universities’ administrative workload and costs for complying with selected requirements, we selected a nongeneralizable sample of six universities to conduct in-depth interviews of officials regarding each of the nine categories of requirements in our scope and to collect qualitative information on the types of administrative workload and costs resulting from the requirements—such as administrative staff costs, researcher time, and investments in systems and processes. The six universities were George Mason University; Johns Hopkins University; Massachusetts Institute of Technology; University of California, Riverside; University of Massachusetts, Amherst; and University of Southern California. We selected these universities because they ranged in the amount of federal research funding they received in fiscal year 2014, as reported by NSF, and because they provided a diverse sample that included both public and private institutions and both member and nonmember institutions in the Federal Demonstration Partnership—a cooperative initiative of 10 federal agencies and 155 university recipients of federal funds that works to reduce the administrative burdens associated with research grants and contracts. We also considered whether these universities had participated in pilot streamlining efforts related to one or more of the nine categories of requirements included in our scope.

At each of the six universities, we reviewed university policies for implementing federal requirements and other relevant documentation, and we interviewed officials from the central offices for administration of grants, principal investigators who led research projects funded by grants, and administrators within the academic departments where principal investigators hold positions. In particular, we discussed the officials’ views on the effects of prior, current, and proposed changes to requirements and their suggestions for streamlining requirements. For further context on universities’ administrative workload and costs, including suggestions for streamlining and views on changes to requirements, we interviewed officials from and reviewed studies conducted by the following stakeholder organizations: the Association of American Medical Colleges, Council on Governmental Relations, Federal Demonstration Partnership, Federation of American Societies for Experimental Biology, National Academy of Sciences, and National Science Board. We identified these organizations based on discussions with agency and university officials and reviews of published reports, and selected those that had studied administrative workload and costs related to our selected categories of requirements.

To examine OMB and agency efforts to reduce the administrative workload and costs for complying with the requirements included in our scope and the results of these efforts, we focused on government-wide efforts led by OMB and OSTP as well as on agency-specific efforts at DOE, NASA, NIH, and NSF. We identified current and past streamlining efforts by reviewing agency documents, attending presentations by agency officials at Federal Demonstration Partnership and other public meetings, and interviewing OMB and OSTP staff as well as officials from the four research funding agencies in our scope. To determine the results of these streamlining efforts, we reviewed agency documents, including assessments of the results of their efforts, and interviewed agency and university officials. We also interviewed agency officials regarding government-wide efforts to coordinate development and implementation of requirements among agencies and the feasibility of suggestions for streamlining requirements. We interviewed OMB staff regarding their plans to review the effects of the Uniform Guidance, including the effects on universities’ administrative workload and costs, and we interviewed OSTP and agency officials on streamlining and coordination efforts by the Research Business Models working group within the National Science and Technology Council’s Committee on Science. Finally, we interviewed officials from offices of inspectors general at the four funding agencies in our scope about the potential effects of changes to requirements on the ability of grant-making agencies to ensure transparency and accountability, and about the NIH and NSF inspector general audits of a pilot program at four universities to streamline requirements for documenting personnel expenses.

We conducted this performance audit from April 2015 to June 2016 in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives.

Appendix II: Sources and Goals of Selected Administrative Requirements

Table 3 lists the sources and goals of selected administrative grant requirements.

Appendix III: Examples of Differences in Selected Administrative Requirements across Agencies in GAO’s Review

Table 4 shows examples of differences in selected administrative requirements across agencies in our review.

Appendix IV: Office of Management and Budget and Selected Research Funding Agency Efforts to Reduce Administrative Workload and Costs Related to Selected Requirements

Table 5 provides information on Office of Management and Budget (OMB) and selected funding agency efforts to standardize forms, systems, processes, and provisions related to our selected administrative requirements on research grants. The efforts listed in table 5 all share the goal of reducing universities’ and other grantees’ administrative workload and costs, according to agency officials and documents.

Table 6 provides information on agency efforts to streamline selected pre- award administrative requirements, in particular by postponing certain requirements until a preliminary decision has been made about the likelihood of a proposal being funded. The efforts listed in table 4 all share the goal of reducing applicants’ administrative workload and costs for developing proposals—particularly in cases where the chance of the proposal being funded is small.

Table 7 provides information on OMB and agency efforts to reduce grantees’ administrative workload and costs related to selected requirements, by allowing them more flexibility in their grant management approaches.

Appendix V: Comments from the Department of Energy

Appendix VI: Comments from the Department of Health and Human Services

Appendix VII: Comments from the National Aeronautics and Space Administration

Appendix VIII: GAO Contact and Staff Acknowledgments

GAO Contact

John Neumann, (202) 512-3841 or neumannj@gao.gov.

Staff Acknowledgments

In addition to the contact named above, Joseph Cook (Assistant Director), Ellen Fried, Cindy Gilbert, Elizabeth Hartjes, Terrance Horner, Miles Ingram, Richard Johnson, Sarah Martin, Dan Royer, and Monica Savoy made key contributions to this report.