Update on CMU's Response to F&A Funding Cap

February 10, 2025

Dear Members of the Carnegie Mellon University Community:

I am writing this evening to confirm that Carnegie Mellon University has joined in a lawsuit filed by the Association of American Universities (AAU) against the federal government.

This lawsuit, filed in the First District of Massachusetts earlier today, challenges new guidance issued by the National Institutes of Health (NIH) that significantly and immediately reduces the federal government’s investments in U.S. research universities.

CMU is represented in this lawsuit as an AAU member, and we have also joined as an individual party plaintiff. Currently, 12 other universities – including MIT, Johns Hopkins University, and the University of Pennsylvania – have also signed on as individual plaintiffs in the lawsuit, as have the Association of Public and Land-Grant Universities and the American Council on Education. In the coming days, the number of plaintiffs included in the AAU lawsuit and the number of lawsuits being filed on this issue may continue to grow. In fact, attorneys general representing 22 states have already filed their own lawsuit on this issue.

As Provost Jim Garrett and Vice President for Research Theresa Mayer recently shared with the CMU research community: The new NIH guidance seeks to cap grant reimbursements for facilities and administrative (F&A) costs at 15%, effective today. At Carnegie Mellon, a 15% F&A cap reduces our current reimbursement rate for NIH grants by more than two-thirds. This abrupt policy change would drastically undercut the ability of CMU and other leading research institutions to deliver on our mission and, in the process, would undermine the innovation ecosystem that powers U.S. competitiveness and enhances our societal well-being.

For background: F&A costs are real expenses incurred during the research process that are reimbursed to the university at a pre-negotiated federal rate. These expenses are associated with operating and maintaining research facilities and labs, complying with federal regulations, maintaining our research computing infrastructure, keeping data secure and more.

As the AAU shared in its statement, the impact of the F&A funding cap would harm “the ability of research universities to continue doing critical NIH research that investigates new and more effective approaches to treating cancer, heart disease, and dementia, among others, and translat[es] basic science into cures,” and the requisite funding cuts “would also irreparably harm universities’ essential training of the next generation of biomedical and health science researchers. It goes on to say that “the loss of this American workforce pipeline would be a blow to the U.S. economy, to American science and innovation, to patients and their families, and to our nation’s position in the world as a leader in medical research.” I couldn't agree more.

I wish to thank the university’s academic and administrative leadership – especially Theresa Mayer, Jim Garrett and Vice President and General Counsel Mary Jo Dively – for their tremendous leadership during this time as well as the many faculty members who have contributed to this effort. I am also grateful for the CMU Board of Trustees for their continued counsel and support as we navigate these challenging issues.

I am hopeful that our collective efforts will bring about a resolution that continues to see the federal government and research universities working together to fuel American innovation, enhance national security and drive economic prosperity.

With Warm Regards,

Farnam Jahanian
President
Henry L. Hillman President’s Chair