Dear Marty and friends,
Marty, you have hit upon an issue that is near and dear to my heart as a
Research Administrator...Indirect Costs. These costs are also known as
Overhead, Administrative costs, Facility costs, and probably names I
forget. They are the "non-science" part of the expenses related to doing
research. They can and do vary from institution to institution.
Science is not conducted in an open field...it requires a building that
is heated in the winter, cooled in the summer, laboratory space that
complies with OSHA and state regulations, equiped with special safety
devices and specialized analytical and computer equipment that is kept in
good repair, an environment that guarantees the proper handeling, storage
and disposal of some very dangerous chemicals and gases, business support
including personnel, payroll, accounting, purchasing and grants and
contract specialists...all with expert know-how in federal and state
regulations and building service staff including engineers, maintenance
and housekeeping. In addition, telephones, computers and library
services to provide contact with the outside world is necessary. Oh, and
how about security and insurance costs. Mostly all of these would be
considered direct costs in the for-profit world of business. However, in
the non-profit world of bio-medical research, they are considered
indirect costs when you consider the direct cost of the research itself
including scientific salaries and benefits, special consultant costs,
scientific supply costs like chemicals, glassware and gases, scientific
meetings, animal research costs, publication costs, etc. that relate
directly to the cost of doing a specific project.
If the physical plant is old, its' cost of upkeep and repair might be
high when compared to a new, modern facility. Then again, the new,
modern facility may have a large and expensive debt to be paid over many
years. If it is a State owned facility, it may be subsidized and
supported in many ways by tax dollars. Thus an organization like say
Harvard Medical might have an overhead expense of over 100% (that is over
$1 going to overhead for each $1 of direct support for medical research)
as compared to say 25% ($0.25 going to overhead for each $1 of direct
support for medical research) for a State Medical School...the difference
being that the State is contributing $0.80 (for each $1 directed to
research) from its' tax revenues for things like heat, electric, building
and grounds maintenance, etc.
So you see, you can't say that one organization is better run because it
has a lower overhead rate. There are many issues that go into an
organization's overhead and you really have to look at each one as an
individual unit and ask are they getting the bigest bang from the
buck...i.e., have they managed to be leaders in a specific field? what
is their track record in getting peer reviewed grant funding from
supporters like the Nation Institutes of Health? are the staff well
published and respected? have they come up with tangible and meaningful
results? In short, is this the kind of an organization that I wish to
have my name and money associated with?
I hope this puts a beam of light on a rather dark and misunderstood
topic. I would be receptive to any and all questions or comments any of
you wish to make. If none, I'll go back to telling jokes! By the way, I
tried calling Ron and his line is busy...a rather good sign I'd say!
God Bless.
John
Martin Auslander wrote:
>
> My Dear Friends,
>
> Barb and I are researching into the various charities and causes that
> benefit cancer survivors and one of my questions to them was what were
> the administration fees, as I had heard horror stories about this and
> where the money was going to. HOpe this benefits. YOur thoughts on
> charities where moneys donated go to research for cancer with minimal
> ancellary, superfluous, miscellaneious and administration fees. I happen
> to know that all the donations given to CHOC, (Childrens Hospital of
> Orange County) are spent for research and no donations go for expenses
> in research other than the research itself. That was reassuring.
>
> God Bless
> marty auslander
>
> Jim Caffey wrote:
> >
> > > Date: Wed, 22 Apr 1998 07:56:14 -0700
> > > From: Martin Auslander <fitecancer@earthlink.net>
> > > Reply-to: fitecancer@earthlink.net
> > > Organization: cancer support
> > > To: aicrweb@aicr.org
> > > Subject: Donation possibility
> >
> > > We are located in the Southern cal area. Do you have a location here and
> > > what are the administration fees when a donation is given? thank you.
> > >
> > > marty auslander
> > > fitecancer@earthlink.net
> > >
> > >
> > >
> > Dear Mr. Auslander,
> >
> > The American Institute for Cancer Research is a nonprofit, tax exempt
> > organization whose purpose is to provide funding support for research
> > into the relationship between diet, nutrition and cancer and to expand
> > consumer knowledge about the result of such research as it relates to
> > cancer prevention and treatment in the United States and worldwide.
> > Contributions to AICR are deductible for federal income tax purposes
> > within the extent of the law. For the fiscal year ending September 30,
> > 1997 the Institute's expenses totaled $27,806,859. Of that amount,
> > research and public education programs accounted for 68% of all
> > expenditures by the Institute. Fundraising costs for the year were 21%
> > of total expenses and 11% of expenses went to administration costs.
> >
> > This year approximately 1,382,400 Americans will develop
> > cancer. Research shows that dietary change together with physical
> > activity and the elimination of tobacco could decrease cancer
> > incidents by 60 to 70%. AICR offers one of the most significant hopes
> > for preventing cancer through its research & education programs on the
> > relationship between diet, nutrition and cancer. If you would like to
> > have a copy of our annual report which includes our audited financial
> > statements or to obtain any of our helpful publications please feel
> > free to write to us at
> >
> > The American Institute for Cancer Research
> > 1759 R Street, NW
> > Washington, DC 20009
> >
> > We are not organized as a chapter organization. Although our research
> > is conducted around the country we do not have offices beyond our
> > office in Washington, DC. You can also call toll free at
> > (800)843-8114 or email to support@aicr.org, give us your name and
> > address and the publication you wish to receive and we will be glad
> > to send it to you.
> >
> > Sincerely,
> >
> > Jim Caffey
> > Development Assoc.
> > ***************************************************
> >
> > The American Institute for Cancer Research
> > (800)843 8114
> > Visit us on the World Wide Web: Http://www.aicr.org
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