UPenn slashes graduate admissions as 'cost-saving measure' over NIH funding changes—school has $22 billion endowment: report

Interim School of Arts and Sciences Dean Jeffrey Kallberg at the University of Pennsylvania (UPenn) has said that in order to save on costs due to a change in the amount of funding the college may get from the National Institute of Health (NIH), the school will be cutting graduate school admissions. UPenn, as of last June, had an endowment of $22.3 billion. The NIH funding change could amount to the school losing $240 million.

According to the Daily Pennsylvanian, Kallberg wrote in a February 23 email that he had to make the "difficult" decision to cut graduate admissions by a third because it was a “necessary cost-saving measure to help mitigate the impact of these new funding realities."

The funding change stems from a proposed 15 percent cap on indirect costs at the NIH and the administrator wrote the change “would have an immediate and broad impact” on the financial status of research, and overhead expenses at UPenn. These indirect costs include funding for overhead research expenses like lab spaces as well as support staff.

“While the cap has been temporarily blocked by a restraining order, it remains clear that we are operating in a highly unstable fiscal environment and should expect to see a decline in federal support this year,” the dean added.

Grants from the NIH were identified by Kallberg as direct sources of the School of Arts and Sciences' operating budget, according to the college outlet. The university stands to lose $240 million from the potential cuts to the NIH spending, the outlet reported.

In the email, Kallberg said that the cuts to the number of student admissions will be part of a change "both across Penn and at some of our peer institutions." He claimed that UPenn has a commitment to maintain "the strength of our graduate programs” and “closely monitor the impacts and uncertainties being shaped by external forces."

“We also recognize the problematic aspects of the timing of this decision – an unfortunate reflection of the speed at which changes have been taking place at the federal level, causing disruptions in what is typically a predictable and well-planned process,” Kallberg added.

The Pennsylvanian previously reported that a faculty member said, “We go through hundreds of applications, we interviewed dozens of finalists, and basically all that work was just for naught. We just wasted half of those people’s time because our list just got cut by more than half."