Condition of MSU research quickly evolving due to federal funding cuts, freezes

MSU has confirmed that over 50 research projects were affected and two programs canceled due to recent federal funding cuts and freezes. While a significant portion of those projects had their funding freezes lifted on the afternoon of March 12, questions on the state of federally funded research at MSU remain.

On Jan. 20, President Donald Trump issued an Executive Order titled “Ending Radical And Wasteful Government [Diversity Equity and Inclusion (DEI)] Programs And Preferencing,” which stated that DEI action plans demonstrate “immense public waste and shameful discrimination.” A week later, President Trump’s office and the Office of Management and Budget issued a memo to the heads of executive agencies instructing them to freeze federal grants, loans and assistance programs. A federal judge quickly blocked the freeze, and a second judge extended that block on March 6. However, as federal agencies seek to comply with quickly changing executive mandates, an MSU researcher has raised concerns about the potential impact on scientific progress. 

MSU associate professor Roland Hatzenpichler — who was also the organizer of Bozeman’s Stand Up For Science (SUFS) rally last Friday — expressed in an interview with the Exponent on March 7 that these policy changes could undermine scientific research and education by limiting funding and restricting research topics. 

Several grants at MSU have recently been canceled or paused due to federal activity. MSU Vice President of Communications Tracy Ellig said that the federal government is currently evaluating billions of dollars awarded to research universities across the country. This has resulted in grant funds being frozen pending review or terminated in some cases.

One of these grant cancellations was MSU’s Mountains and Plains Thriving Communities Collaborative, which received a $10 million five-year grant for rural community development from the Environmental Protection Agency (EPA) in 2023. 

“Because the grant focused specifically on rural places, it was flagged as wasteful DEI,” Hatzenpichler said. According to him, a $3 million Department of Defense (DOD) grant for climate change research in Africa — called the “Minerva Program” — was canceled for the same reason. 

“To date, MSU has received two federal grant termination notices,” Ellig confirmed, explaining that since these grants are contracts between the government and research universities, MSU has written a letter appealing the termination of the EPA program because it did not follow the contract agreement. “We do not know when or how this will be resolved,” he said.

Ellig also said that MSU was not the primary awardee of the DOD grant, but a sub-awardee under the University of California Santa Barbara (UCSB). He explained that funds are sent to UC Santa Barbara and then dispersed to MSU. “We have reached out to [UCSB] as to what action it plans to take and have not gotten a reply,” he said.

Additionally, Hatzenpichler stated that as of March 7, 58 federal grants — primarily from the U.S. Department of Agriculture (USDA) — are on hold. “[These grants] have been deemed by peer reviewers, and by federal agencies, to be worth funding. The money has already been transferred to MSU in most cases, and they are currently on pause and no one knows what will happen,” Hatzenpichler said.

When asked to confirm this information, Ellig said he believed Hatzenpichler was referring to a single federal grant from the USDA called the Specialty Crop Block Grant program (SCBG). This grant funds 57 agriculturally-related research projects, including predicting soilborne disease in pulse crops, grasshopper crop damage management and more. The funding goes to the Montana Department of Agriculture and is then dispersed to MSU, according to Ellig.

“When the University is awarded a grant, it never receives all the money in one lump. The dollars are dispersed to the University in increments,” Ellig said, explaining that out of the approximate $10 million allotted to those SCBG projects, about $4.4 million was received by MSU and some $5.6 million was frozen as of March 11. 

However, as of 3 p.m. on March 12, Ellig informed the Exponent that all projects under the SCGB have been unfrozen. According to him, this is indicative of how rapidly these situations are changing. 

In his interview on March 7, Hatzenpichler said that in the past two weeks, members of the federal administration and politically appointed leaders of federal agencies — like the NIH and the National Science Foundation (NSF) — have released lists of words they consider controversial or ideologically motivated, and could potentially trigger audits for federal grants.

Hatzenpichler added that he has already been contacted by a program officer of the NSF who asked him to retract a recently submitted proposal and rephrase it to avoid the words “women,” “female” and “diversity.” 

When asked if other MSU researchers have encountered any similar issues in their proposals, Ellig explained that any instruction to remove certain words would come from grant program officers, not MSU.

He clarified that the federal government — through numerous agencies such as the NSF, NIH and DOD — determines national research priorities. Those agencies then allocate funding for those priorities and put out calls to research universities to explore and advance specific issues.

“It is not unusual for federal funding priorities to change with a new administration and new funding opportunities will likely have different requirements,” Ellig said. He explained that under previous federal administrations, some research grant proposals were required to describe how the grant would advance DEI. 

Hatzenpichler explained that considering DEI and accessibility in science ensures comprehensive research by accounting for different demographics — such as women, rural populations and racial minorities — which is vital for effective and accurate medical treatment, as some groups have unique responses to medications. 

He cited the exclusion of women from medical trials between 1977 and 1993 as an example of this oversight. According to Hatzenpichler, this caused drugs like opioids, aspirin and antidepressants to be developed without considering their effects on women, which resulted in harm due to this lack of research on sex-specific responses. 

Hatzenpichler said that MSU students should be concerned with policy surrounding federal research funding because the University receives $33 million annually in indirect costs (IDC) from federal research grants. IDCs are costs associated with research such as building expenses and core facilities support, according to MSU’s website. On Feb. 7, the NIH cut its IDC rates for research grants to 15 percent. Hatzenpichler said that if this cut was applied not only to the NIH but also to other federal agencies, it could result in a loss of up to $22 million for MSU, because the negotiated cost rate of IDCs between MSU and the federal government is 45 percent. He stated this would cripple the University's ability to conduct research. 

However, Ellig stressed that this hypothetical loss of $22 million is based on the assumptions that all federal granting agencies could adopt a 15 percent IDC rate, and that every grant has a 45 percent IDC rate. He clarified that IDC rates can differ for each grant, ranging from eight percent to a cap of 45 percent. Additionally, even if all granting agencies adopted a 15 percent IDC rate, the University’s actual loss would be between $8.4 and $10 million, according to an estimation from the Office of Sponsored Programs. 

“Negotiations over IDC rates and their final rate on each grant is very complex: In some cases, the IDC rate cannot be applied to certain portions of the grant. In some cases, there are grants where the federal government feels an IDC rate of 45 percent is not justified. The IDC framework of allowable and unallowable costs is very complex: think income-tax-filing-level complex,” Ellig said.

“Does MSU receive $33 million annually in IDCs from the wide array of federal grants it receives? Yes. But as of today, the only agency that has signaled a possible change is the NIH, and that action is currently on hold pending litigation,” Ellig said, referencing a block of the NIH cut by a federal judge on Feb. 10 and its subsequent extension on Feb. 21, according to the state of Massachusetts Office of the Attorney General.

Additionally, he noted that MSU’s $33 million in IDCs was a record-high total in 2024 based on the University’s record research expenditures and will likely go down, regardless of federal action on IDC rates.

Finally, Ellig said that MSU only receives $4 million annually in IDCs from NIH grants. “If the NIH IDC rates were changed to a flat 15 percent, that would cut the NIH IDC funds in half — to $2 million per year,” he said.

“It seems possible that overall available federal research grant dollars from all agencies [are] likely to contract — or significantly shift to new areas of focus — in coming years,” Ellig said. “Would a decline in grant-funded research dollars cripple [MSU]? That is too strong a term. It would certainly change the breadth and depth of the research enterprise at the University, but it would do so simultaneously across the nation.”

According to Ellig, it remains to be seen which research fields will be most vulnerable and what the federal government will decide to prioritize. “The federal government is the largest source of research funding at universities across the nation. If the federal government changes focus on research areas, there are few funding alternatives — private foundations — and none of the same capacity as the federal government,” he said.

Ellig clarified that any DEI component in any grant exists because the federal government required it for the grant to be awarded to a research university. “MSU did not make up the DEI requirements of these grants; we responded to them. Research faculty are understandably frustrated that they followed the federal rules of applying for a competitive grant — rules that included DEI initiative requirements — and now the federal government is changing the rules,” he said. 

Ellig emphasized that the University is very proud of the research its students and faculty do. “We are very proud of every single research dollar faculty have won and how they’re using it. We know there is a strong case about the benefit to America's economy, America’s security and towards the preparation of students to enter our workforce and society through research,” he said. 

Hatzenpichler encouraged those concerned about these issues to spread the word and talk to their representatives. He mentioned a current online petition calling for a public meeting with Representatives Ryan Zinke and Troy Downing and Senators Tim Sheehy and Steve Daines. 

“The most important thing is to communicate these concerns to our elected officials,” he said.