119-hr422

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 422 Introduced in House

    (IH) ]

<DOC>

119th CONGRESS
 1st Session
 H. R. 422

 To establish Federal research award reimbursement limits for indirect 
 costs for institutions of higher education, and for other purposes.

_______________________________________________________________________

 IN THE HOUSE OF REPRESENTATIVES

 January 15, 2025

 Mr. Cline (for himself, Mr. Clyde, and Mr. Harris of Maryland) 
 introduced the following bill; which was referred to the Committee on 
 Science, Space, and Technology, and in addition to the Committee on 
Education and Workforce, for a period to be subsequently determined by 
the Speaker, in each case for consideration of such provisions as fall 
 within the jurisdiction of the committee concerned

_______________________________________________________________________

 A BILL

 To establish Federal research award reimbursement limits for indirect 
 costs for institutions of higher education, and for other purposes.

 Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

 This Act may be cited as the ``No Subsidies for Wealthy 
Universities Act''.

SEC. 2. DEFINITIONS.

 In this Act:

    (1) Agency.--The term ``agency'' has the meaning given the 
 term in 

section 551 of title 5, United States Code.

    (2) Direct cost.--The term ``direct cost'' has the meaning 
 given the term in subpart E of part 200 of title 2, Code of 
 Federal Regulations (or any successor regulation).

    (3) Endowment fund.--The term ``endowment fund'' has the 
 meaning given the term in 

section 312
            (c) of the Higher 
 Education Act of 1965 (20 U.S.C. 1058
            (c) ).

    (4) Federal research award.--The term ``Federal research 
 award'' means support provided to an individual or entity by an 
 agency to carry out research activities, which may include 
 support in the form of a grant, contract, cooperative 
 agreement, or other transaction.

    (5) Indirect cost.--The term ``indirect cost'' has the 
 meaning given the term in subpart E of part 200 of title 2, 
 Code of Federal Regulations (or any successor regulation).

    (6) Indirect cost rate.--The term ``indirect cost rate'', 
 with respect to a project supported under a Federal research 
 award, means the ratio, expressed as a percentage, of the 
 indirect costs of the project to the direct costs of the 
 project, as determined in accordance with subpart E of part 200 
 of title 2, Code of Federal Regulations (or any successor 
 regulation).

    (7) Institution of higher education.--The term 
 ``institution of higher education'' has the meaning given such 
 term in 

section 102 of the Higher Education Act of 1965 (20 
 U.S.C. 1002).

SEC. 3. CAPPING INDIRECT COSTS ALLOWABLE UNDER FEDERAL RESEARCH AWARDS.

    (a) Endowment Calculations.--

    (1) Collection by nces.--Not later than September 30 of 
 each year, the Commissioner for Education Statistics shall--
        (A) collect information regarding the value of the 
 endowment funds, as of September 30 of the preceding 
 fiscal year, of each institution of higher education 
 that has entered into a program participation agreement 
 with the Secretary of Education under 

section 487

    (a) of 
 the Higher Education Act of 1965 (20 U.S.C. 1094

    (a) );
        (B) use the data described in subparagraph
        (A) to 
 identify--
            (i) each such institution of higher 
 education with endowment funds that, in total, 
 are valued at more than $5,000,000,000, as of 
 September 30 of the preceding fiscal year; and
            (ii) each such institution of higher 
 education with endowments funds that, in total, 
 are valued at more than $2,000,000,000 but not 
 more than $5,000,000,000, as of September 30 of 
 the preceding fiscal year; and
            (C) make lists of the institutions identified under 
 each of clauses
            (i) and
            (ii) of subparagraph
        (B) and 
 submit such lists to the Director of the Office of 
 Management and Budget.

    (2) Distribution by omb.--Not later than September 30 of 
 each year, the Director of the Office of Management and Budget 
 shall make the lists described in paragraph

    (1)
            (C) available 
 to--
        (A) the head of each agency;
        (B) Congress; and
            (C) the public.

    (b) Limits on Indirect Cost Reimbursements for Institutions With 
Significant Endowment Funds.--

    (1) Prohibition for institutions with highest endowment 
 funds.--Notwithstanding any other provision of law, the head of 
 an agency making a Federal research award for a fiscal year to 
 an institution of higher education identified under subsection

    (a)

    (1)
        (B)
            (i) for the preceding fiscal year shall not allow any 
 Federal research award funds to be used for indirect costs.

    (2) Indirect cost rate limit for institutions with 
 substantial endowment funds.--Notwithstanding any other 
 provision of law, the head of an agency making a Federal 
 research award for a fiscal year to an institution of higher 
 education identified under subsection

    (a)

    (1)
        (B)
            (ii) for the 
 preceding fiscal year shall establish an indirect cost rate for 
 the Federal research award that is not more than 8 percent.
            (c) Limits on Indirect Cost Reimbursements Rates for Other 
Institutions.--Notwithstanding any other provision of law, the head of 
an agency making a Federal research award for a fiscal year to an 
institution of higher education not identified under clause
            (i) or
            (ii) of subsection

    (a)

    (1)
        (B) for the preceding fiscal year shall establish 
an indirect cost rate for the Federal research award that is not more 
than 15 percent.
            (d) Program Participation Agreement Requirement.--

Section 487

    (a) of 
the Higher Education Act of 1965 (20 U.S.C. 1094

    (a) ) is amended by 
adding at the end the following:
 ``

    (30) The institution will annually provide the 
 Commissioner for Education Statistics with the endowment fund 
 information needed by the Commissioner to carry out 

section 3

    (a)

    (1) of the No Subsidies for Wealthy Universities Act.''.

SEC. 4. IMPROVING OVERSIGHT OF INDIRECT COST REIMBURSEMENT.

 The Comptroller General of the United States shall prepare and 
submit to Congress an annual report regarding the indirect costs 
reimbursed under Federal research awards made to institutions of higher 
education for the preceding fiscal year. The report shall--

    (1) determine, to the extent practicable, for such fiscal 
 year--
        (A) the amount of reimbursed indirect costs for 
 Federal research awards that were used for 
 administrative staff compensation at institutions of 
 higher education; and
        (B) the amount of reimbursed indirect costs for 
 Federal research awards that were used for compensation 
 for administrative staff members with responsibilities 
 related to diversity, equity, and inclusion;

    (2) identify the research fields that receive the highest 
 levels of funding from Federal research awards made to 
 institutions of higher education; and

    (3) identify--
        (A) the agencies that awarded the highest amount of 
 Federal research award funds to institutions of higher 
 education; and
        (B) the institutions of higher education that 
 received Federal research awards from such agencies.

SEC. 5. EFFECTIVE DATE; APPLICABILITY.

 This Act shall take effect on the date that is 1 year after the 
date of enactment on this Act and shall apply with respect to Federal 
research awards made on or after such date.
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