Federal Grant Accountability Act

House Votes

This bill would cap the “indirect” (overhead) costs that colleges and universities can charge on federal research awards. The cap would match the average overhead rate allowed by private research funders, and the Office of Management and Budget would set that private average each year. Indirect costs are the expenses that keep research running—like buildings, utilities, and admin support—not costs tied to one specific project .

It also orders a federal study to compare overhead rates on federal and private research awards, look at which fields get the most funding, review how much overhead pays for administrative staff (including diversity, equity, and inclusion roles), and check whether agencies apply the rules consistently. A report with recommendations is due within one year of the law taking effect.

• Who is affected: Colleges and universities that receive federal research awards; federal research agencies that fund them.
• What changes: Indirect costs on federal awards cannot be higher than the private-sector average; existing federal rules define what counts as indirect costs.
• When: The private-average rate is set at least once a year; the study’s report is due within one year of enactment.