A federal judge Wednesday temporarily halted the Department of Energy’s plans to cut approximately $405 million in annual research funds to colleges and universities, dealing a setback to Trump administration efforts to reduce spending.
Judge Allison Burroughs of the U.S. District Court for the District of Massachusetts ordered DOE not to cut “indirect costs” for projects, which cover administrative and building expenses tied to research. On Friday, DOE said it would cap those costs to colleges and universities at 15 percent, down from more than 30 percent. The plan could affect more than 300 universities and research on everything from climate change to fusion.
The policy would create “immediate and irreparable injury,” wrote Burroughs, who was appointed by former President Barack Obama.
DOE should not terminate “any grants pursuant to the rate cap policy or based on a grantee’s refusal to accept an indirect cost rate less than their negotiated rate,” added Burroughs.
She said she would consider whether to issue a longer-term block on DOE’s plans at a hearing on April 28. In the meantime, she ordered the department to notify affected award recipients of her order and provide biweekly updates to the court confirming the continued distribution of funds.
DOE did not immediately respond to a request for comment. In issuing the policy Friday, Energy Secretary Chris Wright said capping indirect costs would ensure “every dollar of taxpayer funding is being used efficiently.”
“The purpose of Department of Energy funding to colleges and universities is to support scientific research — not foot the bill for administrative costs and facility upgrades,” he said.
Nine universities and three higher-education organizations sued the department Monday, saying the plan would devastate research and hurt industries supported by the Trump administration, including nuclear power and artificial intelligence. Indirect costs support infrastructure and personnel critical for research, such as computer systems and salaries, they said.
The Association of American Universities, one of the organizations that sued DOE, said the plan would set a “dangerous precedent” that could be used to undermine research at other federal agencies. Senate Appropriations Vice Chair Patty Murray (D-Wash.) and House Appropriations Energy-Water ranking member Marcy Kaptur (D-Ohio) also pressed DOE on Wednesday to reverse the policy in a letter shared with POLITICO.
“At a time when China is investing billions to catch up to the scientific advancements driven by decades of DOE investments, the US should be accelerating its technological leadership, but this policy does the opposite,” the letter said.
The American Council on Education, the Association of Public and Land-Grant Universities, Brown University, the California Institute of Technology, Cornell University, the board of trustees at the University of Illinois, the Massachusetts Institute of Technology, the University of Michigan, the board of trustees at Michigan State University, the trustees of Princeton University and the University of Rochester in New York joined the lawsuit against DOE.
DOE provides more than $2.5 billion annually to colleges and universities, supporting research on renewables, fossil fuels, storage, emerging technologies and the electric grid. The court ruling arrives ahead of expected broad job cuts across the department. More than 3,200 employees took an offer last Friday to voluntarily leave their positions, according to people familiar with internal department operations.
In February, the National Institutes of Health proposed a similar 15 percent cap on indirect costs, a move that was later blocked by a federal judge.
