Indirect
Costs:
Problems
of
Administration
EDITOR'S NOTE: This is the second in a series of three articles
dealing with indirect costs of research at the University.
By ROBERT JOHNSTON
Acting Daily Editor
The Offices of Business and Finance and Research Admin-
istration use broad supervisory authority to accomplish what
they call "reimbursement to the University for indirect costs."
The manifestations of these bureaucratic mechanisms are visible
at every step of the research grant process.
The forms-to-be-filled-out, the calls-to-be-returned, the com-
mittees, the directives, the memos and the impersonality of it
all are the standard symptoms. Vice-President for Business and
Finance Wilbur K. Pierpont and Vice-President for Research A.
Geoffrey Norman are the chief monitors.
Procedural Points
All proposals for research to be undertaken at the University
are initiated by faculty members, but every one must be signed
by Norman. Pierpont must approve the final contract.
It is a long way that a research project travels from a
gleam in a faculty member's eye to final realization. The process
begins as a formal-proposal-to-be-drawn-up and finally ends-
possibly many years later-as a research-acco.unt-to-be-closed-out.
Most departments now have their own personnel to assist
in drawing up budgets for research proposals, since professors
aren't always well acquainted with the niceties of budget planning.
In drawing up a typical budget, the experts first figure
direct costs-salaries and wages for people working on the
project, travel expenses and equipment and supplies that will
be required.
Indirect Costs
Next, provision must be made for indirect costs.
The common method for calculating how much each research
project should pay the University for indirect costs involves
two aggregate figures: the University's total outlay for indirect-
cost expenses, computed by federal procedures outlined in Bureau
of the Budget circular A-21, and the total . of all salaries and
wages paid for sponsored research work here.
Divide the former by the latter and you have a percentage
which can be applied to each individual project. Given the
salaries-and-wages figure for such a" project, which is easy to
calculate directly, the accountant uses the indirect-cost percentage
to arrive at the indirect-cost figure.
The figures in current use, 45 per cent of direct salaries and
wages for campus-area projects and 39 per cent for Willow Run
work, are averages that spread indirect costs evenly over all
sponsored research projects,
For example: suppose the percentage being used is 45 per
cent and $100,000 of a research grant is budgeted for salaries
and wages. Then if the grant is to pay a full allowance for
indirect costs, $45,000 should be budgeted in the grant proposal
for this item.
But experience has shown that few major sponsors except
the defense department are willing to pay the full amount. Some
government agencies are restricted by law to a certain maxrmum
amount that they are allowed to pay. Others, particularly private
foundations, are simply unwilling to pay very much-if anything
-for indirect costs.
Pre-Estimated
Pierpont points out also that, for many of the larger grant
proposals, probable indirect costs are estimated ahead of time
by the University rather than simply calculated with suggested
percentages.
Often, even before sending the request to the potential
sponsor, the proposing unit will cut the indirect-costs request
to a figure approximating what they expect that agency will pay.
Then all the anticipated expenses-direct and watered-down
indirect-are added up and the request is sent. In the hands of
the sponsor, the indirect-costs figure may suffer some further
reduction.
Whoever does the cutting, by the time the approved request
comes back to Ann Arbor, its indirect-costs component is likely
to be much lower than what the government's A-21 circular says
the indirect costs really will be.
Give and Take
So a certain amount of bargaining, adjusting and decision-
making must take place. What types of projects and in what
amounts can the University accept without hurting its overall
program? What is the project worth to the University in terms
of faculty interest, overall excellence and teaching improvement?
Pros must be delicately balanced against cons. One problem
that is becoming increasingly acute is that of space. Added research
requires added space and this extra room is becoming harder and
harder to find.
When these problems are worked out and the project is
approved on all sides, it can get under way. As the sponsoring
See INDIRECT, Page 2
MRS. REEB
GOT ROSES
See Editorial Page
C", 4c
Sir~n
A6F
:43att
CLOUDY
High-35
Low-25
Some snow flurries
tonight and tomorrow
Seventy-Four Years of Editorial Freedom
VOL. LXXV, No. 139 ANN ARBOR, MICHIGAN, SATURDAY, 13 MARCH 1965 SEV N CENTS
EIGHT PAGES
I
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YTO
98-71,
Ii
CA
OPE
ER
,
Take on Vanderbilt
For Portland Berth
Buntin 'tps All Scorers with 26
In Scoring, Rebounding Display
By RICK STERN
Special To The Daily
*
*
*
* *
*
*
I? oonit-q
To Act onJOJhSOn,
Wallace
Plan
* *
Parley
U-C Clasht
By CLARENCE FANTO
Alabama Protests
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The University of California
LEXINGTON, Ky.-Michigan's Wolverines, showing their Regents are likely to accept the
awesome power against spirited but thoroughly outclassed resignations of President Clark
Dayton, rolled to a 98-71 triumph here last night to move into Kerr and Acting Chancellor Mar-
tin esn at anemrnc
tonight's championship game of the Mideast Regional Tour- meeting today, anf eme gees
nament. reported last night.
Rebounding and shooting as well as they have all season, The Regents are reportedly split
the Wolverines earned the right to face Vanderbilt tonight for cision uestionbe dvered aunt
the regional championship and a shot at a trip to Portland, later. They are meeting amid
- Ore., for the finals next week- growing support for Kerr and
end. The game will be tele- Meyerson from students, faculty
'Blue Ribbon vised on WJBK, Channel 2, and educato meetgofstheCalifornia
and broadcast on WAAM and faculty members passed a resolu-
Report Enters WUOM-FM beginning at 9 tion last n'ght urging Kerr and
p.m. Meyerson to continue their leader-
Fznal St esship* of the nine-campus, 100,000-
Final Sta es Vanderbilt, ranked fifth in the student university. The vote was
Associated Press poll, eked out 891-23. The Academic Senate
Gov. George Romney's "blue rib- an 83-78 overtime win over De- scheduled t meeting in ordernto
bon" Citizens Committee for High- Paul of Chicago in last night's demonstrate to the Regents their
er Education met yesterday to opener to qualify for tonight's support for Kerr and Meyerson,
consider recommendations from showdown. informants said.
its subcommittees, as work on the. Buntin Paves Way The resignations, announced
group's report moved into the Big Bill Buntin, winning his Tuesday, culm'nated more 'than
final stages. duel with Dayton's-6'1", 245-poune six months of political controversy
The committee refused to re- Henry Finkel, led all scorers with on the Berkeley campus. Kerr and
lease any information about the 26 points. Buntin clicked on 12 Meyerson indicated they had taken
content of the report of the pro- of 21 shots. Oliver Darden picked their "dramatic step" in response
ceedings at its meeting. However, in 17. while Cazzie Russell, shoot- to pressure from severai Regents
a spokesman intimated that re- ing only 14 times, had 14 points. to expel students involved in re-
cently published accounts of the George Pomey and Larry Tr cent "obscenity" rallies. Kerr said
subcommittee recommendations GerePmyadLryT. the rallies had perverted freedom
mightubemmisleadingmm t goning rounded out the balanced into "license for hard-core porno.
might be misleading. scoring attack of the Wolverine graphy" but he was reportedly
The accounts, which stated that with 12 and 11; respectively. Fin- reluctant to take drastic action
several of the subcommittee rec- kel led Dayton with 22, and Den- aga nst students for fear of spark-
ommendations imply support for nis Papp added 18. ing new agitation on the Berkeley
Gov. Romney's stand against the Rebounding spelled the defea' campus.
University's Flint expansion pro- for the Flyers as the Wolverines In another development, Edward
gram, were based on information had seven players with more thar M. Strong, deposed chancellor of
Ar uuallyriale oucee four apiece and outboarded the the Berkeley campus, blamed Kerr
A usually reliable source pie- smaller foes, 56-30. The Blue also for shattering discipline by re-
dicted Thursday that the commii?~ outshot the Flyers with .471 per- peated "capitulation" to student
lee's report will not be made pu- centage compared to .440. rebels. In a full-scale review of
lic until April. the events of the past six months,
The committee will hold another Michigan broke loose for 10 Strong made his charges in a
mneeting today; while yesterday's straight points late in the firs secret report to the Regents. The
session was closed to outsiders, half to take a 44-25 lead, and Oakland Tribune obtained parts of
an official indicated that repre- when the Wolverines had stretch the report and published them last,
sentatives from each state institu- ed it to 60-39 early in the second night.
tion will be in attendance today, half, it was merely a question o Strong went on leave for reasons
It is expected that each of the ow large the final margin would of health Jan. 2 and was replaced
several subcommittees will release be.by Martin. Meyerson as Acting'
their reports separately after they Strack Relaxes Chancellor. In the report, Strong'
are approved by the entire com- With six minutes left in the said he had been given a choice
mnittee. See MICHIGAN, Page 7 See U-C, Page 8
State Steps
Into Housin
Dispute Trial
The state of Michigan took a
tentative step into the Ann Ar-
' wns discrimina.tion d's-
pute yesterday when Atty. Gen
Frank Kelley agreed to assign
one of his assistants to defend
landlord C. Frank Hubble in ar
alleged violation of the city's Fair
Housing Ordinance.
Kelley's intervention came afte.:
Circuit Court Judge James R
Breakey contacted him following
yesterday's brief court hearing o'
the appeal.
The date for the appeal ha,
been set for March 19.
Necessary
Breakey said the appointmen
of an assistant attorney genera
was necessary so law could be pre-
sented fully on both sides. Hr
said the decision has such "grave
public interest" that all sides o'
the law must be considered.
The case will go with all dur
speed from this point, Breakey in-
dicated.
The city's Fair Housing Ordi-
nance was ruled unconstitutiona'
on procedural grounds by Munici
pal Court Judge Francis L. O'Brien
last May. An appeal by City At-
torney Jacob Fahrner has beer
pending since that time.
Possibility
Breakey brought up the possi-
bility of sending the case back tc
Municipal Court to have the de-
fendant tried on the merits of the
case itself.j
Hubble, a member of a DetroiV
property management firm, wa
charged with discriminating
against a Negro who had attempt-
, t - n rt + nt in the'
Parkhurst-Arbordale units. Hub-
ble is manager of these apart-
ments.
O'Brien did not conduct a tria'
on the innocence or guilt of Hub
ble concerning the complaint
Breakey questioned whether th;
Circuit Court should hear the case
without the Municipal Court com-
pleting its proceedings.
Ruled
Kelley had ruled in an ouinior
that local fair housing ordinance,
were invalid because the State
Civil Rights Commission preempt,
the field.
Fahrner said the state com-
mission is relying on "some er-
roneous law" and said a court
decision should be issued to clar-
ify the commission's responsibili
ties and duties.
It is likely, he added, that t-
Continue
FtBI *Agent
Justifies Use
OfTear Gars
Negro Describes
Attacks by Police
During Sehna March
MONTGOMERY, Ala. (/P)-Gov.
George Wallace asked President
Lyndon B. Johnson last night for
an appointment to discuss the
>.<=r civil rights upheaval in Alabama.
Johnson agreed to the confer-
ence, saying, "I will be available
in my office at any time that is
convenient to you."
Meanwhile, a Federal Bureau of
Investigation agent testified yes-
terday in federal court that he
thought state troopers acted in
the interest of public safety by
tear-gassing Negro marchers last
Sunday, at Selma.
The testimony by agent James
M. Barko of Mobile, Ala., caught
Justice Department attorneys by
surprise. Barko took the stand in
the second day of a hearing to de-
termine if civil rights leaders may
stage a Selma-to-Montgomery
march tvthout police interference.
Barko was one of four FBI
agents put on the stand by Asst.
U.S. Atty. Gen. John Doar to iden-
tify pictures of Sunday's march
and the bloody encounter between
the demonstrators and clubswing-
ing, gas-masked troopers.
.:f The march was broken up with
clubs and tear gas after the Ne-
groes fell back and knelt or sat
on the ground alongside a high-
l
HATCHER DENIES CHARGES:
UMSEIJ Protests Lost Communication
Members of the University of
Michigan Student Employes Un-
ion (UMSEU) picketed in front
of the Administration Bldg. yes-!
terday protesting what they claim-
ed were closed channels of com-
munication with the administra-
tion.
University President H a r la n
Hatcher denied this accusation
saying that the UMSEU had at-
tempted to contact him during the
Flint controversy, the Tucson
meetings and his illness.
Two hundred students rotating
in groups of 30 carried signs pro-
testing the present minimum wage
i
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(i
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,1
ROBERT JOHNSTON, '66, (TOP LEFT) AND CY WELLMAN, '66, (top, right) were named Editor
and Business Manager respectively of. The Daily last night by the Board in Control of Student Pub-
lications. The board also appointed (bottom, left to right) Lawrence Kirshbaum, '66, managing edi-
tor; Jeffrey Goodman, '66, editorial director, and Judith Fields, '66, business staff personnel direc-
tor. Johnston pledged the new staff would strengthen and amplify the respect and importance to
the University community gained for The Daily by the outgoing senior editors during their tenure.
Johnston Named Daily Edtor
way on the outskirts of the city
after their first encounter with
the state police.
B'arko was asked by defense
attorney Maury Smith if he could
say how many officers it would
take to give adequate protection
for a large group of marchers on
a 50-mile pilgrimage to the state
capitol.
The FBI agent misunderstood
the question and replied, "I be-
lieve the troopers were justified
in the use of tear gas ..."
He was cut off at that point
because the answer was not re-
sponsive to the question,
A short time later, however, an-
other defense attorney, McLean
Pitts, asked him, "Is it your opin-
ion that the troopers acted with
discretion in using gas?"
Barko said he used the wrong
word in his first answer but that
he thought that "in the interests
of public safety" his answer would
be yes.
Then, on cross examination by
Negro attorneys, Barko said:
"If a crowd in large numbers
By BRUCE WASSERSTEIN
Robert Johnston, '66, was ap-
pointed editor of The Daily for
1965-66 last night by, the Board{
in Control of Student Publica-
tions. Cy Wellman, '66, was nam-
ed business manager.
Others appointed to senior edi-
torial staff positions were Lau-
rence Kirshbaum, '66, managing
editor; Jeffrey Goodman, '66, edi-
torial director; Judith Warren,
and Susan Crawford, '66, associ- community. This year's staff be-
ate business manager. lieves that this tradition can be
The newly-appointed editor even further strengthened and
commented, "The Daily seniors amplified as The Daily moves into
this year have done a tremendous its 75th year."
job in making the paper important Retiring Daily Editor H. Neil
and respected in the University Berkson, '65, noted, "The Daily
UU1ZZLU±riILr ut.A;r bn banu#c clr.hh
r
Say Exatu Sales
Brought Profits
appointments process is proua i3
one of the most arduous around.
Tnis year, in particular, things.
were in a state of flux for some
time: But the staff which has
come out of this process should
1'kt' + . -. ;,