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The NSF is one of four federal agencies that sought to cap indirect research costs at 15 percent.
Photo illustration by Justin Morrison/Inside Higher Ed | U.S. National Science Foundation
A federal judge tossed out the National Science Foundation’s policy capping reimbursements for costs indirectly related to research, finding “severe” deficiencies in the agency’s reasoning for the plan as well as “errors of law.”
The ruling from Judge Indira Talwani of the District of Massachusetts is the first final judgment against the 15 percent cap, which three other federal agencies have also sought to implement. Judges have temporarily blocked those caps, but in this lawsuit, the plaintiffs sought summary judgement, which allows the judge to reach a final decision without a trial.
Thirteen universities along with the Association of American Universities, the Association of Public and Land-grant Universities, and the American Council on Education sued the NSF in May to block the cap, arguing the policy would cut funding to institutions and risk the country’s standing “as a world leader in scientific discovery.” The government’s lawyers said in court filings that the cap would have meant a cut of $432.3 million for colleges and universities in fiscal year 2024.
The Trump administration argued that NSF did follow the law and that the universities didn’t have standing to sue. Additionally, the policy was not subject to judicial review, the administration said.
But Talwani, an Obama appointee, ruled that she could review their decision, and in capping indirect rates via a policy note, NSF officials failed to follow federal regulations as well as the Administrative Procedure Act, which in part requires agencies to explain their reasoning.
The government can appeal the order vacating the policy.
