Rep. Cline Introduces Bill To Curb Subsidies For Wealthy Universities

Today, Congressman Ben Cline (R-VA) introduced the No Subsidies for Wealthy Universities Act. This legislation would ensure that higher education institutions are properly using taxpayer-funded federal grant money for conducting research projects, rather than for funding Diversity, Equity, and Inclusion (DEI) initiatives, by eliminating indirect cost reimbursement on federal research grants for institutions with endowments over $5 billion and capping indirect cost reimbursement for institutions with endowments larger than $2 billion but less than $5 billion at 8 percent. The bill also caps indirect cost reimbursement for all other institutions at 15 percent.

This bill comes following disturbing antisemitic protests at U.S. colleges across the nation and the leadership of these elite colleges failing to protect Jewish students on campus.

Senator Mike Lee (R-UT) and Roger Marshall (R-KS) are introducing the effort in the Senate, and Heritage Action endorses the bill.

Rep. Ben Cline said, "Billions in taxpayer dollars intended for scientific research at wealthy universities, like Columbia and Harvard, are being hijacked to finance radical DEI agendas. This misuse of funds is a blatant betrayal of American taxpayers. Congress has a duty to intervene, ensuring that these dollars are dedicated to legitimate research purposes, not to advance the Left's political doctrine on our campuses."

"The tax dollars of hard-working American families are going to ultra-wealthy universities, like Columbia and Harvard, supporting woke DEI programs while churning out graduates who riot for the destruction of Israel and desecrate the American flag,"said Sen. Lee. "It is a disgrace, which is why I introduced legislation to cut off certain public funding streams to the richest universities. If they want to trash their reputations as academic institutions, they can do it on their own dime."

Background:

• In 1946, taxpayers began subsidizing scientific research at higher education institutions.

• The cost of all academic research projects is broken down into two types of costs: direct costs of the project and overhead expenses, also known as indirect costs.

• While direct costs are easy to quantify and itemize, indirect costs are not. Currently, universities can receive reimbursement from federal agencies based on an indirect cost rate, defined as a percentage of the direct costs of a research project. This is negotiated between the federal agency awarding the project and each university.

• In some cases, that indirect cost a university is reimbursed for can be as high as 60 percent, which means the university can receive hundreds of thousands of dollars in reimbursements for indirect costs that can be used by the school for whatever purposes they choose. While some schools use those funds directly toward the research project, others are likely to use the money to fund Diversity, Equity, and Inclusion (DEI) activities on college campuses.

• During fiscal year 2022, Ivy League universities received $1.8 billion for overhead on government-funded research grants.

• Harvard's endowment of $53 billion exceeds the gross domestic product of 124 countries.

Read the full bill text here.

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