Columbia University Discussion of effort reporting principles Michael

Why is there so much emphasis on effort reporting? • Federal funding comes with certain strings attached – Compliance with applicable cost principles – Because of the legal requirements, all universities and academic medical centers should have effort reporting systems, policies and procedures – Columbia’s recent work is consistent with what many of its peer institutions are doing © Hogan & Hartson LLP. All rights reserved.

Why is there so much emphasis on effort reporting? (cont’d) • Frequent focus of Federal enforcement activity • Several multi-million dollar False Claims Act settlements • OIG audits – NSF is currently conducting a series of effort reporting audits © Hogan & Hartson LLP. All rights reserved.

What is effort reporting? • The salaries paid by Columbia to its employees working on Federal grants are generally charged or allocated to those grants on the basis of effort expended • For example, if 25% of an employee’s total Columbia effort is expended on a Federal grant, then up to 25% of the employee’s salary is chargeable to that grant • The 25% effort figure is derived by estimating effort devoted to the grant, and expressing it as a percentage of the employee’s total Columbia effort – Federal cost principles specifically acknowledge that estimates are permissible • A certified effort report confirms that charges are reasonable in relation to the work performed © Hogan & Hartson LLP. All rights reserved.

What do sponsors consider effort devoted to a grant? • Actual conduct of research in furtherance of a grant’s objectives • Administrative effort directly associated with the research • Special lectures, writing reports and articles, participating in seminars, consulting with colleagues and graduate students, attending meetings and conferences • Preparing progress reports • “On the job” training of grant personnel • It doesn’t matter when or where the effort is expended (e. g. , weekends, vacations) © Hogan & Hartson LLP. All rights reserved.

What do sponsors not consider effort devoted to a grant? • Effort expended on research not in furtherance of the objectives of the grant to which it is charged, i. e. , effort related to another grant or to an area of general scientific interest • New proposal writing • General instruction • General administrative activity • Unrelated departmental research • Unrelated clinical activity © Hogan & Hartson LLP. All rights reserved.

How much flexibility do PI’s have to define the scope of their grants? • Research objectives can and do evolve over a grant’s period of performance – Major sponsors such as NIH and NSF recognize this and afford PIs some flexibility in terms of revising or adapting a project’s methodology and approach – But that flexibility is not without limit – And sponsors do not view their support for a PI as “one pot of money” - each grant is distinct – If research objectives evolve to the point where there is a “change in scope”, sponsor approval is required – Work outside a grant’s approved scope is not chargeable to that grant © Hogan & Hartson LLP. All rights reserved.

NIH Guidance • “In general, the PI may make changes in the methodology, approach, or other aspects of the project objectives. However, the grantee must obtain prior approval from the NIH awarding office for a change in the direction, type of research or training, or other areas that constitute a significant change from the aims, objectives, or purposes of the approved project (hereafter “change in scope”). ” NIH GPS • Examples of a change scope include: – Change in the specific aims approved at the time of award – Substitution of one animal model for another – Any change from the approved use of animals or human subjects – Shift of the research emphasis from one disease area to another – Application of a new technology, e. g. , changing assays from those approved to a different type of assay © Hogan & Hartson LLP. All rights reserved.

NSF Guidance • “NSF believes that the PI/PD and co-PI/co-PD, operating within the established policies of the grantee organization, should feel free to pursue interesting and important leads that may arise during the conduct of a research (or other grant-supported) project or to adopt an alternative approach which appears to be a more promising means of achieving the objectives of the project. Significant changes in methods or procedures should be reported to appropriate grantee official(s) and the cognizant NSF Program Officer. ” NSF AAG © Hogan & Hartson LLP. All rights reserved.

Principles for determining whether effort is chargeable to a grant • There is some room for interpretation • Sponsors fund projects based on proposed goals, objectives and methodologies • Auditors and IGs do not view their agency’s support as discretionary funds for PIs • Discretion to modify the approach that got you an award in the first place exists but is not unfettered • As the PI, you are responsible for the charges to your grants – If you were interviewed by an auditor, consider how would you defend your decision to charge a particular researcher to a specific grant © Hogan & Hartson LLP. All rights reserved.

Principles for determining whether effort is chargeable to a grant (cont’d) • • Progress Report – Provides some basis to defend salary charges related to described activities – More persuasive for future work than past work – But the govt can and does question its own “tacit” approvals during audits and investigations The cost principles recognize that research and teaching are often “inextricably intermingled” – Arguably more flexibility for grad student charges than there is for faculty charges • – E. g. , on the job training Unrelated research, however, still not chargeable © Hogan & Hartson LLP. All rights reserved.