A coalition of universities, including Brown University and the Massachusetts Institute of Technology, alongside education groups, have initiated legal action to block the Department of Energy’s recent reductions to federal research grants. The DOE recently announced a policy to slash the funding of “indirect costs” associated with research grants to 15%. However, the plaintiffs contend that these cuts will severely impact scientific research at American universities and weaken the nation’s position as a global leader in innovation.
The lawsuit argues that slowing down the pace of scientific discoveries will hinder progress on vital areas such as a secure nuclear deterrent, innovative energy sources, and treatments for serious illnesses. The plaintiffs fear that these cuts will allow America’s competitors to gain ground while causing setbacks for science and industry within the United States.
The legal action, filed in the U.S. District Court of Massachusetts, alleges that the policy change is unlawful and violates the Administrative Procedure Act. The plaintiffs are seeking an injunction to halt the implementation of this policy. Other parties joining the lawsuit include Cornell University, the University of Illinois, the University of Michigan, Michigan State University, Princeton University, the University of Rochester, the Association of American Universities, the American Council on Education, and the Association of Public and Land-Grant Universities.
This legal challenge follows a previous ruling by the same court this year against a similar cut in research funding by the Trump administration to the National Institutes of Health.
Regarding indirect costs, the Energy Department allocates more than $3.5 billion annually in grant programs to support research at over 300 colleges and universities. These funds cover both direct costs for specific projects and indirect costs for facilities and administration that are not tied to a particular project. The lawsuit emphasizes the critical role of indirect costs in scientific work, including the operation of specialized facilities, data analysis systems, researchers, and administrative staff.
The complaint argues that indirect cost rates should be determined based on individual circumstances and needs, as negotiated by federal offices in accordance with regulations from the Office of Management and Budget. The plaintiffs contend that the DOE’s new Rate Cap Policy violates these regulations by imposing a standardized indirect cost rate.
In contrast, the DOE asserts that the new policy will result in significant annual cost savings of over $405 million. U.S. Secretary of Energy Chris Wright stated that DOE funding to universities is intended for supporting scientific research rather than covering administrative expenses and facility upgrades.
The plaintiffs warn that the immediate impact of the policy will be severe, potentially halting numerous critical projects that have been in progress for years. These projects include advancements in nuclear and cybersecurity technologies, nuclear arms control verification methods, innovative cancer treatments, and enhancements to rural electrical grids.
The complaint raised concerns about the impact of funding cuts on various communities and institutions. It stated that the reductions would lead to decreased staffing and training programs, harm career prospects, and affect the future of scientific research. Brown University, Caltech, and Cornell University would face significant financial losses, while MIT anticipated losing millions in research reimbursement if the Department of Energy reduced indirect costs rates. The complaint argued that these cuts violated the law and urged the court to invalidate the Rate Cap Policy. The American Council on Education warned that the cuts would have severe consequences for energy, physical sciences, and engineering research across the country, potentially undermining America’s economic strength and global competitiveness. University leaders, including Brown University President Christina H. Paxson, MIT President Sally Kornbluth, and Cornell officials, expressed grave concerns over the potential impact of the funding reductions on their research initiatives and the development of future scientists.
