This email was sent to the AEL, PIs and Co-PIs on federal grants, academic leaders, and RIO staff and forwarded to the Grants Management User Network, UMN associate deans for research, Sponsored Financial Reporting, Sponsored Projects Administration staff, and the UMN Certified Approvers group by the Research and Innovation Office,
Dear Colleagues,
Late on Friday afternoon, the NIH issued Guide Notice NOT-OD-25-068, entitled "Supplemental Guidance to the 2024 NIH Grants Policy Statement: Indirect Cost Rates." This new notice informs all grantees that, effective February 10, 2025, all new NIH awards will be issued with a 15% indirect cost rate. This 15% cap will also apply to all costs incurred on existing awards after this date.
As you are aware, the University has a negotiated Indirect Cost Rate Agreement with the federal government, which specifies agreed-upon F&A reimbursement rates through June 2028. Despite this, the position of the NIH, via the Guide Notice, is that it has the authority under federal regulations to deviate from negotiated rates for all grants by communicating the new rate and justifications for the deviations from negotiated rates.
We understand and fully appreciate the profound impact of this notice – for you, our University of Minnesota research community and our state. The University is fully engaged in response. A team of University leadership convened early today to chart a course forward and shape a response. We are actively partnering with higher education associations and peer institutions (e.g., Big10, AAU, APLU, COGR, AAMC) to express our serious concern about this proposed change and to ensure that its implications are recognized and well understood. Additionally, we have already reached out to our federal and state delegation members this morning through our government relations office to ensure they are aware and to express our concern about its implications.
We recognize and fully appreciate that news of this notice coupled with other actions being proposed at the federal level related to diversity, sustainability, and immigration creates a significant level of uncertainty and concern. Please know that we are actively engaged on these issues and are fully committed to keeping you updated and will work tirelessly to ensure the University’s research endeavors continue to thrive. We will continue to strongly advocate on your behalf as we explore every avenue to address the challenges posed by this notice.
Early next week, SPA will update you if any changes are needed in how your award needs to be handled, along with ways you and members of your teams can best engage on these issues.
Thank you for your patience and understanding as we navigate through these challenging times and for all you do for the University of Minnesota.
Sincerely,
Shashank Priya
Vice President for Research and Innovation