S.Amdt. 3985

This amendment aims to change how the National Institutes of Health (the covered agency) handles indirect costs and reimbursements for research awards given to institutions of higher education, nonprofit organizations, and hospitals (covered entities).

The primary goals of the amendment are:

• Preventing Changes to Cost Methods: It creates a moratorium starting in fiscal year 2026 that stops the agency from changing the methodology or negotiated rates used to determine indirect costs for research awards.

• Protecting Current Rates: It requires the agency to continue reimbursing entities at the negotiated rates used in the third quarter of fiscal year 2024 until the new rules take effect.

• Establishing New Reimbursement Rules: It introduces a specific system for calculating reimbursements, including:

  • A fixed rate of 15 percent for general research operations costs.
  • An option for entities to either be reimbursed for research performance and essential research performance support costs based on project activities, or to use a fixed rate of 10 percent for research information and data services and essential research performance facilities costs.

• Requiring Maintenance of Effort: Covered entities must promise to keep their non-Federal spending for research activities, infrastructure, and services at a level no lower than the year before the Act is enacted.

• Setting Limitations on Agency Power: It prohibits the agency head from using the total cost of an award as a reason to decide who receives an award, or from issuing guidance that limits financial reimbursement for the total costs of awards.