A federal judge has blocked the Department of Energy's (DOE) proposal to cap indirect cost reimbursements for universities at 15%, pending hearings. This decision comes following a lawsuit from major higher education associations and prestigious universities, who claim that the cap would inflict immediate and irreparable harm. The current average reimbursement rate is approximately 30%. Higher education leaders assert that these funds are vital for covering indirect expenses related to research projects. The halted plan closely mirrors a previous initiative by the National Institutes of Health that was also blocked by the courts.
Judge Allison D. Burroughs emphasized the urgency of the plaintiffs' situation, stating that they would face "immediate and irreparable injury" without a temporary restraining order.
The Department of Energy's plan to cap indirect research cost reimbursements at 15% could severely impact university research budgets, as current rates average around 30%.
Higher education associations argue that limiting reimbursement rates threatens the financial stability of research initiatives, as indirect costs often fund essential support services and infrastructure.
The DOE typically allocates over $2.5 billion annually to 300+ institutions to cover critical indirect costs linked to research projects, including administrative and operational needs.
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