UC Berkeley collected $105M overhead

UC Berkeley’s reported $105 million in research overhead has put a campus budget line at the center of a wider Washington fight over how federal science money should be spent. The figure, reported by The Daily Californian, surfaced days after the White House renewed its push to reduce what universities collect in indirect costs on federal grants. The dispute is over money that does not go straight to a lab bench but helps pay for the systems that keep research running. Berkeley’s own guidance says those costs include space, utilities, payroll support and research administration. ### What is the $105 million actually measuring? The $105 million figure refers to research overhead, also called indirect costs or facilities and administrative costs, that Berkeley collected on sponsored research, according to The Daily Californian. Universities charge those costs on top of eligible direct research expenses, such as salaries, supplies and equipment. (dailycal.org) UC Berkeley’s sponsored-projects office says indirect costs are expenses “that cannot be easily identified with any specific sponsored project” but are incurred for shared research purposes. Berkeley lists examples including space and utilities, payroll processing, research space, infrastructure depreciation, health benefits and salaries for research administration staff. ### Why do universities get to charge overhead in the first place? (dailycal.org) Federal rules require agencies to accept a university’s negotiated indirect-cost rate unless a different rate is required by statute or regulation, Berkeley says on its sponsored-projects page. Berkeley says those rates are negotiated with the U.S. Department of Health and Human Services. The Congressional Research Service said in a May 16, 2025 report that indirect costs at universities are typically set through pre-negotiated rates with the federal government and have ranged from 30% to 70% by institution. (spo.berkeley.edu) CRS said those reimbursements cover costs such as utilities, research administration and library services that cannot be readily tied to a single project. ### What exactly is the White House trying to change? (spo.berkeley.edu) The White House Office of Science and Technology Policy released a report on July 21, 2026 titled *Science: A New Golden Age* that called for agencies to “rein in indirect cost recovery” and redirect money away from what it described as administrative bloat. The report argued that current indirect-cost rates at major institutions function as a “substantial tax on research budgets.” (congress.gov) A separate AAMC summary of the July 21 report said the administration wants to provide more support for individual scientists rather than universities and reduce dependence on what OSTP called “a narrow set of legacy institutions.” ### Has the administration already tried to cap these rates? The Trump administration moved in February 2025 to impose a 15% cap on NIH indirect-cost rates, and similar caps were later announced by the Department of Energy, National Science Foundation and Department of Defense, according to AIP. (whitehouse.gov) Courts blocked those efforts, and Congress also stepped in on some agency policies. (aamc.org) AIP reported on June 11, 2026 that the administration was still pursuing narrower changes through a proposed Office of Management and Budget rule. That proposal would keep the negotiated-rate system in place on paper but disallow some costs now covered indirectly and give preference to institutions with lower indirect-cost rates, AIP said. ### Why is the percentage so hard to compare with a dollar figure? (aip.org) The Association of American Universities said in a January 20, 2026 report that universities’ reimbursement for facilities and administrative costs averages 25% to 30% of the total project budget, and that the system is often misunderstood because the rate is not calculated as a share of the full award. Instead, AAU said, the rate is applied to a subset of direct costs under federal accounting rules. (aip.org) That distinction matters because a headline dollar figure like $105 million does not by itself show Berkeley’s negotiated rate, how much of the campus research portfolio was federally funded, or how much of the reimbursement covered facilities versus administration. Berkeley’s sponsored-projects office says the campus applies on-campus or off-campus rates depending on where the work is done and whether an exception is granted. (aau.edu) ### What happens next? The next decisions sit with federal agencies, the Office of Management and Budget and Congress. AIP reported that OMB sought comments this year on a proposed grantmaking rule affecting indirect costs, while the July 21 OSTP report laid out the administration’s broader case for steering more federal research money to individual scientists and away from universities. (aip.org) (spo.berkeley.edu)