The following NIH fiscal policies are instituted in FY2008:
Non-Competing Research Awards: The FY 2008 appropriation as specified in P.L. 110-161 provides NIH a 1 percent inflation allowance to NIH investments in research supported by research grants. Implementation requires a reduction to previously established commitments, based on a 3 percent inflation allowance. Accordingly, each Institute and Center (IC) will use its own discretion to allocate the adjustment among its non-competing research grants (modular and non-modular) to ensure compliance with the 1 percent inflation allowance provided in its FY 2008 committed level. Future year commitments will be adjusted accordingly, as consistent with the FY 2007 fiscal policy. This policy does not apply to Career Awards, SBIR/STTRs, and Ruth L. Kirschstein-National Research Service Award (NRSA) Individual Fellowships & Institutional Training Grants.
This is the section on non-competing awards, which have been taking severe cuts since the doubling of the NIH budget ended in 2003. Don't try to figure out what it means, yet. How did this work in past fiscal years?
First off, pretty much all R01 awards take a cut when the application gets funded. Let's take as an example a full modular R01 ($250,000 direct costs per year) that you asked for five years (total of $1,250,000. If you get four years duration at 80% that's $200,000 awarded to your institution for the first year, and a future years committment of $200,000 per year for the last three years.
For the past few years, non-competing awards (i.e., the second, thrid, and fourth year awards) have been cut between 2.5% and 3.0%. "Future years committment" is a technical term found in the official Grant Award document you receive from NIH. It sounds pretty damn solid, no? Well, the cut in a non-competing award is also applied to remaining future years committment. Not too solid.
Let's add up your total award for the entire grant (assume 2.75% cut per year): Year 1 = $200,000; Year 2 = $200,000 * 97.25% = $194,500; Year 3 = $194,500 * 97.25% = $189,151; Year 4 = $189,151 * 97.25% = 183,950. Total: $767,601. What was "approved" through peer review was a $1,250,000 grant, ended up through administrative cuts as only 61% of that. These kinds of cuts are less newsworthy than people not getting any grants or losing the only ones they had, but they are as much, if not more, destructive to the biomedical research enterprise.
Anyway, back to the immediate point, which is that the 2008 fiscal policy does not establish an explicit NIH-wide percentage cut on non-competing awards and future committments. Rather it leaves it to the discretion of the individual Institutes within NIH--neurological, heart, cancer, infectious disease, etc--subject only to what they refer to as an inflation allowance on previously established committments that has been cut from 3% to 1%.
I have no damn idea what exactly this means, so if any readers do, chime in! I just hope I get cut less than last year and the year before. So far, the cuts have been on a worsening annual trend, and I wanna know where I'm at for this fiscal year.
The day this notice was published, I e-mailed my program officer to ask him if he has any idea yet what our institute has in mind. He was not amused.