The Real Source of UMass R&D Spending

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UMass issued a report and a press release Tuesday citing a record level of research and development spending at UMass in fiscal year 2015.

“Despite the tightening of the funding environment, the University of Massachusetts saw sponsored research increase by 4.3 percent during the past year, reaching a record $629 million, President Marty Meehan announced today.”

What might not be immediately evident from the UMass announcement is that all of the 4.3 percent increase in UMass R&D spending in FY2015 was attributable to funding provided by the state and UMass itself, which amounted to an increase of $26.5 million, a 14 percent increase from 2014 to 2015.  Externally-funded research, from federal, business, nonprofit, other sources, actually declined by $670,000 from 2014-2015, representing a 0.2 percent reduction.

Figure 1.  UMass R&D expenditures UMass report 2014-2015 (000s)

Fig. 1

According to data submitted by UMass to the National Science Foundation Higher Education Research and Development Survey, as currently published on the NSF website, externally-funded research at the five UMass campuses declined by 5.6 percent from FY2011 to FY2015, while self-funded research, from university and state funds, increased by 44.8 percent. From FY2011 to FY2015, self-funded research (by UMass and the state) increased by $66.6 million while externally-funded research decreased by $24.6 million.

Figure 2. UMass R&D expenditures by NSF 2011-2015

Fig. 2

Figure 3.  UMass R&D expenditures by NSF 2011-2015 (000s)

Fig. 3

In an environment of declining external R&D funding, UMass and other U.S. public higher education institutions have adopted an apparent strategy of increasing self-funded research.  At U.S. public higher education institutions between 2011 and 2014 (the most recent year for which national data is currently available), external R&D funding has declined by 3.3 percent while self-funded research (by institution, state, and local funding) has increased by 15 percent.  At UMass, external R&D funding has decreased by a greater percent than the national average (5.6 percent versus 3.3 percent) and self-funded research has increased by a greater percentage (26.8 percent versus 15.9 percent).

Figure 4. Comparison of R&D at UMass and U.S. public higher education institutions by NSF 2011-2014 (000s)***see below for further breakdown of funding

Fig. 4

Pioneer is planning to release an upcoming series of reports detailing the changes taking place at UMass, and the challenging road it faces moving forward. The reports will feature recommendations on how UMass can maximize its effectiveness as an affordable university for Massachusetts residents.

UMass President Marty Meehan has deservedly won high praise for his efforts at enhancing the prestige of the state university system, and the increases in R&D expenditures are designed to do just that.  However, if future increases in R&D spending at UMass are going to be largely dependent on funding by the university itself, from tuition, fees, and state appropriations, as has happened since FY2011, the current financial strain at UMass will be exacerbated.

Figure 5. Detailed breakdown of R&D funding at UMass and U.S. public higher education institutions by NSF 2011-2015

Fig. 5

 

2 replies
  1. Ed
    Ed says:

    One needs to remember that only a portion of the money “spent” on R&D at UMass is actually spent on R&D.
    59% is deducted from the total grant to cover “indirect costs” — see http://www.umass.edu/af/howto/256

    This is unencumbered money that can be (and is) spent on damn near anything. ANYTHING…
    “Revenue” of this sort becomes adjustments to budgets — the annual base is not affected, this is just extra money for bureaucrats to spend, and it doesn’t really show up in a lot of places. Hence if the research is being funded by the university itself, and 59% of that funding is being “taxed” by the university itself, then you essentially have a form of “money laundering” — or at least the potential for it. As the “indirect cost” revenue may be spent for any allowable expense (sometimes including alcohol), one could theoretically route money through a grant to spend a portion of it on something it wasn’t intended to be spent on. And then there are all kinds of games you can play with “03” employment, not to mention giving “01” people bonuses, “paying them out of their grant”, and other fun stuff.
    NB: The 59% is UM Amherst and my cite is for FY-2012, although I don’t think it has changed, and I believe the other 4 UM campii have similar policies, most universities do.
    NB: There may also be a “Peoplesoft Tax” of something like 7.9% on the remaining 41% — until spent, the money is held by UM and they “tax” all accounts, including trust accounts (e.g. housing trust funds), this to pay for the uber-expensive new database system.

  2. Oona Martin
    Oona Martin says:

    I agree with Ed in that a “money laundering” strategy is what’s at play, at least with regards to Umass. Even with federal grants which do not allow the 50% indirect costs, the laundering scheme is institutionalized in other creative ways. For instance, tuition costs covered by the many federal and state grants geared to training students for low-incidence fields are written in those grants at a much higher rate than what tuition really costs. The tuition monies for the grant-recruited students are then paid at the lower rate through the “online” or “weekend” course-mill. This tuition does not have to go back to the State Legislature, even though in many instances, the grant students complete coursework with state-paid faculty (not online or weekend faculty). The online or weekend course-mill “revenue-shares” (kicks back) to the grant’s originator or his/her department, typically deposited in ESS, “program support fund”, and/or “program incentive fund” accounts. Certain “chancellor’s fund” and “college’s fund” cuts are also claimed up front, depending on the individual agreements. Once in those accounts, there is no scrutiny on how the monies are spent. There have been parties on site where alcohol was served. At least one high administrator is known to take lavish longer-than-needed trips almost anywhere in the world. Under the guise of fostering “memoranda of understanding” (dozens of those per year), these are courtesy of the unknowing generosity from federal and state grants after “revenue-sharing”. How come that State Auditors do not seem to have yet scrutinized those “revenue-share” accounts and their posted expenses, and/or the proliferation of credit cards associated with those accounts? Nothing stops the revenue-share invisible money from leaving one account and being given to a newly-minted “grantee” as “new funding”, ergo those increasingly generous “internal grants” bestowed upon the favored of every campus administration.
    The revenue-share scheme affects academic quality. Faculty get promoted based on their willingness to join/expand the “free-money” game. It is not unusual that faculty with questionable or scant academic research get promoted over more promising scholars, if the former are productive at bringing “revenue-shareable” monies. Salesmanship winds up being the rewarded category, not advancing one’s research field. Training grants are certainly not considered “scholarship”, but somehow along the line that transformation occurred at Umass…if the price is right.

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