Hopkins admits to overcharges $89,119 wrongfully put on research tab

September 10, 1991|By Patricia Meisol

Johns Hopkins University conceded yesterday that it had inappropriately charged the federal government $89,119 for such things as a presidential trip to Europe and a party for a retiring provost at the Hyatt Regency Hotel.

But in response to a draft federal audit, the university defended such expenses as annual dues to professional associations and business meals as costs of doing research.

The U.S. Department of Health and Human Services questioned $177,000 in Hopkins bills as part of a nationwide survey of so-called indirect research costs at major universities beginning last spring. The review was prompted by the discovery that Stanford University had included parts of the cost of a yacht, flowers, a bed for the president and other non-academic expenses when it made out a research bill for the federal government.

Indirect research costs are the government's share of building laboratories or new space and such things as electricity -- bills that grow precisely because the federal government asks universities to conduct research.

Federal examiners arrived on the Hopkins campus in March. Since a congressional hearing in May -- when Hopkins was cited for inappropriately including the bills for parties, liquor, social club dues and trustee luncheons when it estimated indirect research costs -- the auditors have found additional questionable items charged to the government.

These include the cost of a legal settlement at the Johns Hopkins Hospital, dedication ceremony expenses, staff lunches and fractions of the $157,000 public relations budget at the School of Continuing Studies and the $240,000 budget of the Downtown Center.

"We're acknowledging that, when it prepared its 1987 indirect costs report to the government, the university missed some expenses that were either unallowable or not appropriate for reimbursement," said Eugene S. Sunshine, senior vice president for administration. He said corrective steps taken by the university are designed to ensure that "even this relatively small level of inaccuracy" is avoided, he said.

The $177,000 in question at Hopkins is less than two-tenths of 1 percent of the $49 million the university received in indirect cost payments in 1987, the year federal officials are auditing.

The actual costs that year were used to determine how much the government should pay Hopkins for research-related costs from 1989-1992. Hopkins officials said the questioned amount would not significantly alter the current reimbursement rate.

Hopkins contends other costs cited by the government were appropriate under the rules. These include $6,201 in rent for a Baltimore apartment to house researchers from the Guys Hospital in London who were collaborating with Hopkins researchers; $8,077 in business meals; and $27,610 in dues for such groups as the Middle States Accrediting Agency, the educators' group that visits schools and judges them for minimum quality.

Meanwhile, the university has imposed new rules designed to tighten control over costs associated with research.

For instance, travel outside the United States by university researchers now must be approved in advance by the federal government, spokesman Dennis O'Shea said yesterday.

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