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If the cap goes through, the University of Arizona stands to lose $40.5 million a year in research-support funds, UA's senior vice president for research and innovation, Tomás Díaz de la Rubia, told faculty in an email. 

The lawsuit challenges the Trump administration, the U.S. Department of Health and Human Services and the National Institutes of Health over efforts to reduce funding that goes to so-called indirect costs — including lab, faculty, infrastructure and utility costs.

The states argue that research into treating and curing human disease “will grind to a halt� and people would lose access to “modern gene editing, vaccines such as flu vaccines, and cures for diseases like cancer, infectious diseases, and addiction.�

The NIH announced Friday it was toward overhead costs for universities and other research institutions that receive its grants, a policy that could leave universities with major budget gaps. Currently, some universities receive 50% or more of the amount of a grant to put toward support staff and other needs, but that would be capped at 15% across the board.

The lawsuit, joined by Democratic Attorney General Kris Mayes of Arizona, contends the administration’s action is illegal because indirect cost reimbursements are “negotiated with the federal government through a carefully regulated process, and then memorialized in an executed agreement,� Mayes’ office said in a news release Monday.

“Arizona students and universities will miss out on millions of dollars in critical funding and research support if the Trump administration is not blocked from defunding NIH and its grants to our state,� Mayes said in the release. “This money is owed to Arizonans by law. Beyond the students and institutions negatively impacted now, this will have disastrous and exponential consequences for innovation and progress, curbing our ability to combat disease and protect Americans for generations to come.�

“Without immediate relief, this action could result in the suspension of lifesaving and life-extending clinical trials, disruption of research programs, layoffs, and laboratory closures,� Mayes’ news release said, noting that the NIH is the primary source of federal funding for medical research in the United States.

According to Mayes, the University of Arizona received more than $170 million in NIH funding in federal fiscal year 2024; in 2023, the UA got $197.8 million, says the Blue Ridge Institute for Medical Research.

The institute says Tucson ranked No. 42 among NIH recipients.

UA spokesperson Mitch Zak declined to comment Monday.  

The UA’s overall rate of indirect costs was previously about 55%, faculty and researchers say.

The NIH estimates Arizona State University would lose $10 million and Northern Arizona University would lost $1.8 million under the cap.

Lucy Ziurys, a UA professor and researcher of chemistry and biochemistry at the UA, said the Trump administration’s cap on the funding was “shocking news,� and that she’s worried other federal funding agencies will follow suit.

It would be “catastrophic� for research at the UA and that researchers wouldn’t be able to keep or maintain their labs if the NIH cap holds, Ziurys said.

Felicia Goodrum Sterling, a UA professor and researcher of immunobiology at the UA, said there was a huge return on investment for NIH dollars, in which $2.46 on average is returned for every NIH dollar invested and a lot of that went into jobs and work that supports the state’s economy.

The cap comes on top of the UA’s ongoing budget deficit.

“We are strapped as is right now, given the financial crisis and the constraints we’ve been placed upon like out of no fault of our own,� said David Baltrus, an associate professor in the School of Plant Sciences. “As teachers and researchers, we are put in a situation and we deal with it. We are very much limited in what we can do right now to get UA back on a good financial foundation, and if we lose a bunch of money, I don’t know how much worse it’s going to get.�

The Arizona Board of Regents, which oversees the state’s three public universities, “is aware of the decision by NIH to cap indirect costs on new and existing grants,� said Megan Gilbertson, ABOR’s associate vice president of communications. “Along with our university presidents, the board is actively monitoring this decision to determine how it may impact research at Arizona’s public universities.�