The June 2014 executive summary from the Council on Governmental Relations (COGR) presents a comprehensive overview of the financial challenges facing U.S. research universities. The document highlights that both public and private research universities, many of which are COGR members responsible for over $60 billion in annual research and development activities, are contending with severely constrained revenue streams, including reduced state appropriations, declining federal support, and increasing dependency on university-generated funds. Public institutions, in particular, have experienced a marked drop in state funding—from 31% to 17% of total revenues between 2001 and 2012—forcing universities to continually reevaluate the feasibility of maintaining or expanding critical programs.
The analysis details the growing financial strain caused by stagnant or shrinking federal funding for research, as indicated by the National Science Foundation's 2012 survey showing federal contributions falling below 60% of total research expenditures for the first time in decades. This shortfall has led universities to augment their own financial contributions, now exceeding $13 billion and growing, to cover both direct and indirect (facilities and administrative) research costs, especially as sponsor-imposed caps often prevent full reimbursement of these expenses. The report concludes by stressing the need for sustained and effective collaboration among the federal government, research universities, and other stakeholders to address these funding imbalances, warning that failure to do so could compromise the capacity of the nation’s research enterprise to support innovation and advancement in the future.
“Finances of Research Universities” describes the financial landscape of research universities and calls for active collaboration among all stakeholders to address financial risks to the research enterprise in a productive manner.
