UPDATE 15 June 2016: The NSF Major Research Facility Reform Act of 2016 passed the House on 14 June by a vote of 412 to 9. “This bill will ensure that NSF makes the systematic changes necessary to restore confidence in federally-funded research projects, and that taxpayers can trust us with their money knowing that it will be spent in the manner intended,” Representative Barry Loudermilk (R-GA), the bill’s sponsor, said in a statement.
Although House Science Ranking Member Eddie Bernice Johnson (D-TX) praised the intent of the bill, she expressed concern with some of the bill’s provisions. “The fact is, every other federal agency is held to government-wide standards and policies for contracting. In this bill, we are creating a different set of rules with less flexibility for the National Science Foundation, even though the Foundation’s record overall has been a very good one, and even though the Foundation has taken many aggressive steps already to rectify deficiencies where they did exist.,” Johnson (D-TX) said in a statement.
A new bill tightening oversight on the National Science Foundation’s large-scale projects is moving forward.
The bill, H.R.5049 – NSF Major Research Facility Reform Act of 2016, gained approval from the House Science, Space, and Technology Committee on 27 April and moved to the House floor for deliberation.
The bill was introduced by Representative Barry Loudermilk (R-GA) and co-sponsored by Chairman of the Committee Rep. Lamar Smith (R-TX) on 26 April. During the committee’s markup of the bill, Smith recalled management and budget issues with the National Ecological Observatory Network (NEON), which is a NSF-funded large facility project currently estimated to run $80 million over budget and 18 months behind schedule.
“The Committee seeks to enforce that taxpayer dollars are not wasted on mismanagement and questionable costs,” Smith said in a statement. The bill “addresses gaps in project oversight and management through solutions identified by the NSF Inspector General, auditors, an outside review panel, and the Committee’s own work for a year and a half,” Smith said.
NSF’s major facilities
NEON and other large-scale projects are funded under NSF’s Major Research Equipment and Facilities Construction Funding (MREFC) account. NSF established this account in 1995 to reliably provide resources to complete large projects funded over several years and set uniform standards for large facility projects, among other goals.
After Congress appropriates funds for an MREFC project, NSF awards contracts and cooperative agreements to develop the facilities. Cooperative agreements combine aspects of grants, which are flexible means of providing money for a public purpose, and contracts, which are binding agreements between a buyer and seller for specific services. Cooperative agreements are designed to provide money for a public purpose with ongoing collaboration between the buyer (NSF) and seller (an institution or agency).
The Advanced Laser Interferometer Gravitational-Wave Observatory (LIGO) project, which recently made headlines for detecting gravitational waves produced by the collision of two black holes over 1 billion years ago and over 1 billion light-years from Earth, is one of MREFC’s projects, along with the Daniel K. Inouye Solar Telescope, the Ocean Observatories Initiative, and NEON.
After a whistleblower reported NEON’s budget and management issues, the House Science committee held a hearing in December 2014, as well as several hearings after that, to discuss what went wrong and how to prevent a similar situation from occurring in the future. Along a similar vein, in December 2015 the NSF Director and National Science Board (NSB) requested that the National Academy of Public Administration (NAPA) review how cooperative agreements are used to support the development of large-scale research facilities.
NAPA examined NSF’s largest cooperative agreements of over $100 million funded under MREFC and found that cooperative agreements are appropriate for supporting large-scale research facilities. NAPA also found that NSF is getting better at managing large facility projects, but still has room to improve. The report noted issues with NSF and NSB’s governance and offered suggestions to strengthen agency management practices.
Richard Bukius, the NSF Chief Operating Officer, provided NSF’s response to NAPA’s report before the House Science Committee. He said that NSF was in “general agreement” with all the panel’s recommendations and that the report “provides a roadmap toward strengthened policies and practices for the NSF.” He detailed measures NSF will take in his testimony.
NSF Major Research Facility Reform Act
NSF’s wide variety in large-scale research projects was acknowledged by Johnson, the Ranking Member of the House Science Committee, during bill’s markup. She recalled a recent House Science Committee hearing on LIGO’s achievements and said, “As the LIGO project demonstrated, these efforts involving major facilities have the potential to generate profound breakthroughs in science.”
“However, these major facilities also cost a lot of money. Properly managing those large expenses is critical to ensuring the success of the major facilities projects, and ultimately, critical to the advancement of science,” Johnson continued.
During the bill’s markup, Loudermilk said that the bill strengthens the NSF Large Facilities Office, calling on the office to ensure that expert management staff and NSF work with scientific program staff throughout all phases of project development and construction.
The bill requires NSF to do cost proposal audits for all major multi-user research facilities with total project costs over $100 million and incurred cost audits at least every two years during construction, starting one year after the agreement begins.
Johnson and Loudermilk consulted with each other to create an amendment to the bill that allows contractors to collect a management fee if they can justify their need for one, which replaces the bill’s original stipulation that contractors can only collect a fee if no other funds are available.
The bill increases NSF’s control over project contingency funds by requiring the agency to retain the majority of the funds rather than the awardee. NSF is called on to distribute contingency funds incrementally to the awardee to allow for project continuity and stability, Loudermilk said, and awardees are to report all contingency expenditures to NSF.
The bill closes loopholes for how management fees are used, providing guidelines for what is not allowed. “This prohibition includes alcohol, concert tickets, unnecessary travel, and lobbying,” Loudermilk said.
Rep. Bill Foster (D-IL) offered reserved support of the bill during the markup and said he thought the committee should have gotten more feedback from stakeholders before holding the markup. The act “seems, at best, to me an overly prescriptive bill,” Foster said.
By Elizabeth Goldbaum, GSA Science Policy Fellow