NSF Follows NIH, DOE in Limiting Indirect Costs to 15%
May 02, 2025
Update: NSF's 15% IDC cap has been Vacated Based of Court Decision
On June 20, 2025, the U.S. District Court for the District of Massachusetts, in No. 1:25-cv-11231-IT, vacated NSF’s 15% Indirect Cost Rate policy (NSF 25-034). In compliance with the court’s decision, NSF will not implement the policy at this time.
Update: NSF is Extending its previously issued temporary pause in implementing NSF 25-034
On June 18, 2025 NSF announced they are extending its previously issued temporary pause in implementation of NSF Policy Notice: Implementation of Standard 15% Indirect Cost Rate (NSF 25-034) until the District Court for the District of Massachusetts issues a decision, in accordance with a voluntary stay filed in the United States District Court for the District of Massachusetts in Association of American Universities, et al. v. National Science Foundation, et al., No. 25-cv-11231. This policy applies to all new awards and associated subawards to IHEs. New NSF awards and associated subawards issued during this pause will not implement NSF 25-034 but will include a term applying NSF 25-034 for the entirety of the award if there is a court decision permitting application of the policy
Update: APLU, AAU and ACE filed a joint lawsuit seeking to halt the 15% cap
APLU, the Association of American Universities, and the American Council on Education filed a joint lawsuit in the United States District Court for the District of Massachusetts along with 13 research universities that are negatively affected by the indirect cost cap. The Court’s decision is anticipated soon.
NSF Follows NIH, DOE in Limiting Indirect Costs to 15%
On Friday, May 2, the National Science Foundation (NSF) updated its policy regarding the reimbursement of indirect costs for federally funded grants and cooperative agreements, which will limit the indirect cost recovery for new NSF awards to 15%. We anticipate a court response and temporary restraining order as we have seen for NIH and DOE. We continue to track that process and will keep you informed.
In additional news, Nature reports NSF has stopped awarding new grants or funding existing ones. This is based on an internal NSF memo, not an official notification to research universities. We have yet to learn specific impacts to LSU.