Rice University: Graduate Teaching Costs Charged to NSF Research

Rice University agreed to pay $3,754,186 to settle allegations of graduate teaching costs charged to National Science Foundation research. The Justice Department described the settlement as double the loss to the United States. The government said Rice budgeted graduate student stipends for research, then used part of that money to pay students for teaching unrelated to the awards. If you know the teaching assignments or the grant accounts, you may recognize the gap between the work promised and the work the money actually supported.

The Department of Justice announced the resolution on April 15, 2020. The alleged charges included tuition remission and related facilities and administrative charges as well as stipends. That combination matters to someone inside a university: the teaching assignment could affect more than the student’s stipend line.

What Rice Charged to National Science Foundation Research

The government alleged that the university charged NSF for graduate teaching, tuition and overhead through its research awards. It described a pattern running from November 18, 2006, through September 30, 2018, in which some of the charged costs supported teaching duties unrelated to Rice’s National Science Foundation research and development awards.

A charge has to belong to the award it is billed to. The government alleged that these teaching activities did not benefit the research awards and were not allowable costs of those awards.

As of March 2020, Rice had 215 active National Science Foundation research grants. The government’s allegation turns on which award paid for the work, not simply whether Rice performed research.

For an insider, that puts the student’s actual duties at the center of the account. A proposal may budget a stipend for research. A teaching assignment shows where some of the student’s time went. The question is how the university connected those duties to the research account paying the costs.

We see a research bill allegedly covering unrelated teaching. With overhead on top. Taxpayers were funding a particular research award. The alleged allocation made them pay for a different part of the university’s work.

A Compliance Promise With Every Payment Request

Rice allegedly certified compliance with National Science Foundation award terms on each proposal and every payment request while knowingly charging costs that did not belong to the awards.

This is where grant-fraud allegations reach beyond a disputed budget entry. The institution makes a statement about its compliance when it asks for federal money. The work behind the charge has to support that statement.

The National Science Foundation’s Office of Inspector General conducted the investigation, which began in 2016. The U.S. Attorney’s Office for the Southern District of Texas handled the matter.

Faculty Effort and Graduate Teaching Costs

Scripps Research Institute faced allegations of faculty effort charged to National Institutes of Health grants for unrelated work, while the Rice allegations concerned graduate teaching costs charged to National Science Foundation research.

The Work Behind the Grant Account

For the Rice allegations, the useful comparison connects the proposed research, the students’ actual teaching duties, the support charged and the requests for federal payment. We work with an insider to understand where those accounts diverge and what the institution knew about the difference.

Someone assigning teaching may know which duties occupied the students. Someone administering graduate support may see the stipend and tuition allocation. Someone handling sponsored research may see the proposal budget, award conditions and drawdowns. Those are different views of the same charge. Their value is in connecting the teaching work to the award that allegedly paid for it.

The overhead belongs in that comparison too. We examine how the support and associated charges were allocated together, and whether the explanation matches the work.

The certification about how grant money was used is another part of that comparison. The assurance says the award’s conditions were met. The teaching assignment and account allocation show what that assurance rests on. Which part you can explain from your own work is where our conversation starts.

Columbia Admitted Its Effort Reports Were Inaccurate

Columbia University admitted that certain effort reports contained inaccurate information and its public-health program had mischarged federal grants. The Justice Department’s account of Columbia’s grant charges describes work that did not belong on those awards. The government alleged that reports were produced and certified without verifying the actual grant work, including charges for unrelated proposal writing.

The Rice account gives that broader allocation problem a recognizable form: graduate teaching billed to research. A budget labeled for research and a certification of compliance cannot tell the whole story when the person doing the work can explain a different assignment. That is the knowledge we want to hear.

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers.

You Know Which Work the Grant Paid For

If you know that graduate teaching costs were put on unrelated research awards, speak with our whistleblower experts about which work the grant really paid for. We bring in research-grant whistleblower lawyers and stay beside you as we build your strongest case around the work, the charges and the decisions behind them.