A federal audit published by the National Science Foundation’s Office of the Inspector General Feb. 6 revealed significant financial mismanagement within several of Northeastern’s federally funded research projects. As a result, the university agreed to reimburse the National Science Foundation, or NSF, $616,695.
The audit, which was conducted by a contract firm on behalf of the NSF and obtained by the research watchdog Stop Animal Exploitation NOW!, or SAEN, identified significant concerns regarding Northeastern’s use of more than $1.7 million in NSF grants across research projects spanning from 2019 to 2023 of the approximately $12.1 million of costs the institution claimed during that period. Northeastern Provost and Senior Vice President for Academic Affairs David Madigan said at a Feb. 12 faculty senate meeting that Northeastern currently has about 900 federally-funded research projects.
According to the audit, the NSF questioned a total of $1,049,082 in costs out of the $1,766,547 it reviewed, or 59.4% of audited funds. This means well over half of the reviewed expenses raised “red flags,” possibly indicating issues in the university’s financial oversight of its research. The audit directs Northeastern to strengthen its internal controls and processes for obtaining NSF funding approval, as well as its policies, procedures and internal controls around funding recipient monitoring.
This is not the first time the NSF has raised issues with the institution’s research grants. In 2015, the NSF sued Northeastern for failing to properly allocate and document research funds. Northeastern then repaid $2.7 million of NSF grant money following fraudulent documentation submitted in early 2000s research, then the largest-ever civil settlement with the NSF. In a 2015 statement to The Huntington News following the reimbursement, Northeastern said it had “made significant enhancements to [the university’s] personnel, procedural, and financial controls to support its robust research enterprise.”
The university declined to comment on the most recent reimbursement.
Michael Budkie, the co-founder and executive director of SAEN, argued in a Feb. 13 email that Northeastern should be required to repay the full $1,049,082 in questioned costs unless all expenditures can be justified. Budkie did not respond to request for comment from The News.
The total audited $1,049,082 included $936,125 in “unallowable” costs, which the NSF lists as travel, meal and hotel expenses of grant recipients on its website. These types of expenses are explicitly prohibited under federal funding guidelines, which raises concerns about whether Northeastern’s oversight measures are specific.
The audit also flagged $104,093 in inadequately supported expenses, which are costs that are not supposed by an agreement with NSF and lack evidence to prove they are reasonable and allowable. In his email, Budkie said that there is a lack of documentation and accountability in Northeastern as a whole.
“Northeastern University should be required to refund the full $1,049,082 in questioned costs. If receipt of the funds can’t be fully justified they should be returned,” Budkie wrote. “The federal government needs to be more proactive in policing research grants and contracts.”
An additional $8,865 was questioned in incorrectly applied indirect cost rates and includes expenses involving facilities and administration the school received in the funding.
Beyond the specific dollar amounts given, the audit also reported inappropriately allocated salary expenses, incorrect application of fringe benefits, non-compliance with federal financial management requirements and failure to adhere to institutional policies. Non-compliance with subaward terms and conditions also occurred, according to an email from SAEN.
In a Jan. 6 letter responding to the audit, Alexandria Hui, Northeastern’s executive director of research finance operations, addressed these issues. Hui did not respond to request for comment from The News.
“NU has already reimbursed NSF $406,142 via ACM$,” Hui wrote, referring to the NSF’s Award Cash Management System. “NU agrees to reimburse NSF for an additional $210,553 and will take steps to complete any corrective actions for each of the findings.”
In the audit, Northeastern acknowledged errors and said the university has taken corrective actions to repay the NSF. Throughout the audit, it is mentioned the university will work to develop a “subrecipient support toolkit” to navigate future NSF grant work. Under the NSF’s directive, Northeastern must make the website available for public viewing in order to prevent further errors.
