I
119THCONGRESS
1
STSESSION H. R. 422
To establish Federal research award reimbursement limits for indirect costs
for institutions of higher education, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
JANUARY15, 2025
Mr. C
LINE(for himself, Mr. CLYDE, and Mr. HARRISof Maryland) introduced
the following bill; which was referred to the Committee on Science, Space,
and Technology, and in addition to the Committee on Education and
Workforce, for a period to be subsequently determined by the Speaker,
in each case for consideration of such provisions as fall within the juris-
diction of the committee concerned
A BILL
To establish Federal research award reimbursement limits
for indirect costs for institutions of higher education,
and for other purposes.
Be it enacted by the Senate and House of Representa-1
tives of the United States of America in Congress assembled, 2
SECTION 1. SHORT TITLE. 3
This Act may be cited as the ‘‘No Subsidies for 4
Wealthy Universities Act’’. 5
SEC. 2. DEFINITIONS. 6
In this Act: 7
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(1) AGENCY.—The term ‘‘agency’’ has the 1
meaning given the term in section 551 of title 5, 2
United States Code. 3
(2) D
IRECT COST.—The term ‘‘direct cost’’ has 4
the meaning given the term in subpart E of part 5
200 of title 2, Code of Federal Regulations (or any 6
successor regulation). 7
(3) E
NDOWMENT FUND .—The term ‘‘endow-8
ment fund’’ has the meaning given the term in sec-9
tion 312(c) of the Higher Education Act of 1965 10
(20 U.S.C. 1058(c)). 11
(4) F
EDERAL RESEARCH AWARD .—The term 12
‘‘Federal research award’’ means support provided 13
to an individual or entity by an agency to carry out 14
research activities, which may include support in the 15
form of a grant, contract, cooperative agreement, or 16
other transaction. 17
(5) I
NDIRECT COST.—The term ‘‘indirect cost’’ 18
has the meaning given the term in subpart E of part 19
200 of title 2, Code of Federal Regulations (or any 20
successor regulation). 21
(6) I
NDIRECT COST RATE.—The term ‘‘indirect 22
cost rate’’, with respect to a project supported under 23
a Federal research award, means the ratio, ex-24
pressed as a percentage, of the indirect costs of the 25
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•HR 422 IH
project to the direct costs of the project, as deter-1
mined in accordance with subpart E of part 200 of 2
title 2, Code of Federal Regulations (or any suc-3
cessor regulation). 4
(7) I
NSTITUTION OF HIGHER EDUCATION .—The 5
term ‘‘institution of higher education’’ has the 6
meaning given such term in section 102 of the High-7
er Education Act of 1965 (20 U.S.C. 1002). 8
SEC. 3. CAPPING INDIRECT COSTS ALLOWABLE UNDER 9
FEDERAL RESEARCH AWARDS. 10
(a) E
NDOWMENTCALCULATIONS.— 11
(1) C
OLLECTION BY NCES .—Not later than 12
September 30 of each year, the Commissioner for 13
Education Statistics shall— 14
(A) collect information regarding the value 15
of the endowment funds, as of September 30 of 16
the preceding fiscal year, of each institution of 17
higher education that has entered into a pro-18
gram participation agreement with the Sec-19
retary of Education under section 487(a) of the 20
Higher Education Act of 1965 (20 U.S.C. 21
1094(a)); 22
(B) use the data described in subpara-23
graph (A) to identify— 24
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(i) each such institution of higher 1
education with endowment funds that, in 2
total, are valued at more than 3
$5,000,000,000, as of September 30 of the 4
preceding fiscal year; and 5
(ii) each such institution of higher 6
education with endowments funds that, in 7
total, are valued at more than 8
$2,000,000,000 but not more than 9
$5,000,000,000, as of September 30 of the 10
preceding fiscal year; and 11
(C) make lists of the institutions identified 12
under each of clauses (i) and (ii) of subpara-13
graph (B) and submit such lists to the Director 14
of the Office of Management and Budget. 15
(2) D
ISTRIBUTION BY OMB .—Not later than 16
September 30 of each year, the Director of the Of-17
fice of Management and Budget shall make the lists 18
described in paragraph (1)(C) available to— 19
(A) the head of each agency; 20
(B) Congress; and 21
(C) the public. 22
(b) L
IMITS ONINDIRECTCOSTREIMBURSEMENTS 23
FORINSTITUTIONSWITHSIGNIFICANTENDOWMENT 24
F
UNDS.— 25
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(1) PROHIBITION FOR INSTITUTIONS WITH 1
HIGHEST ENDOWMENT FUNDS .—Notwithstanding 2
any other provision of law, the head of an agency 3
making a Federal research award for a fiscal year 4
to an institution of higher education identified under 5
subsection (a)(1)(B)(i) for the preceding fiscal year 6
shall not allow any Federal research award funds to 7
be used for indirect costs. 8
(2) I
NDIRECT COST RATE LIMIT FOR INSTITU -9
TIONS WITH SUBSTANTIAL ENDOWMENT FUNDS .— 10
Notwithstanding any other provision of law, the 11
head of an agency making a Federal research award 12
for a fiscal year to an institution of higher education 13
identified under subsection (a)(1)(B)(ii) for the pre-14
ceding fiscal year shall establish an indirect cost rate 15
for the Federal research award that is not more 16
than 8 percent. 17
(c) L
IMITS ONINDIRECTCOSTREIMBURSEMENTS 18
R
ATES FOROTHERINSTITUTIONS.—Notwithstanding any 19
other provision of law, the head of an agency making a 20
Federal research award for a fiscal year to an institution 21
of higher education not identified under clause (i) or (ii) 22
of subsection (a)(1)(B) for the preceding fiscal year shall 23
establish an indirect cost rate for the Federal research 24
award that is not more than 15 percent. 25
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(d) PROGRAMPARTICIPATIONAGREEMENT RE-1
QUIREMENT.—Section 487(a) of the Higher Education 2
Act of 1965 (20 U.S.C. 1094(a)) is amended by adding 3
at the end the following: 4
‘‘(30) The institution will annually provide the 5
Commissioner for Education Statistics with the en-6
dowment fund information needed by the Commis-7
sioner to carry out section 3(a)(1) of the No Sub-8
sidies for Wealthy Universities Act.’’. 9
SEC. 4. IMPROVING OVERSIGHT OF INDIRECT COST REIM-10
BURSEMENT. 11
The Comptroller General of the United States shall 12
prepare and submit to Congress an annual report regard-13
ing the indirect costs reimbursed under Federal research 14
awards made to institutions of higher education for the 15
preceding fiscal year. The report shall— 16
(1) determine, to the extent practicable, for 17
such fiscal year— 18
(A) the amount of reimbursed indirect 19
costs for Federal research awards that were 20
used for administrative staff compensation at 21
institutions of higher education; and 22
(B) the amount of reimbursed indirect 23
costs for Federal research awards that were 24
used for compensation for administrative staff 25
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members with responsibilities related to diver-1
sity, equity, and inclusion; 2
(2) identify the research fields that receive the 3
highest levels of funding from Federal research 4
awards made to institutions of higher education; and 5
(3) identify— 6
(A) the agencies that awarded the highest 7
amount of Federal research award funds to in-8
stitutions of higher education; and 9
(B) the institutions of higher education 10
that received Federal research awards from 11
such agencies. 12
SEC. 5. EFFECTIVE DATE; APPLICABILITY. 13
This Act shall take effect on the date that is 1 year 14
after the date of enactment on this Act and shall apply 15
with respect to Federal research awards made on or after 16
such date. 17
Æ
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