More Schools Targeted in Billing Audit : Research: After uncovering funding abuses at Stanford, federal investigators reportedly have put UC Berkeley, Harvard, MIT, USC and others on their list.

Federal investigators who uncovered research funding abuses at Stanford University plan to swoop down next on UC Berkeley, Harvard Medical School, Massachusetts Institute of Technology and Johns Hopkins University, a knowledgeable congressional aide said Thursday.

Another team is considering an investigation of USC and the University of Pennsylvania, the aide said.

The General Accounting Office, the congressional watchdog agency that monitors federal spending, has told Harvard that on April 1 the office will begin reviewing bills submitted to the government for overhead expenses on federally funded research, the aide said.

Leila Kahn, a staff member of the House Energy and Commerce Committee’s investigations and oversight subcommittee said that the GAO also has decided to examine millions of dollars in research overhead charged to taxpayers by UC Berkeley, MIT and Johns Hopkins.

Although the GAO has attacked Stanford for claiming 25% of its library costs as research overhead, MIT is billing the government for 68% of its total administrative costs, Kahn said.

“You look at that and say, it’s got to be a misprint,” she commented. “Is this a teaching university or mostly a government research contractor?”

Harvard Medical School led the nation last year in the rate at which it billed the government for research overhead costs, such as administration, utilities and building depreciation. Its 77% rate means that Harvard collected an additional $77,000 for every $100,000 that the government funded directly for research.

Stanford’s rate was 74%, MIT’s was 62%, and UC Berkeley’s was 49%.

Kahn said that the House subcommittee, headed by Rep. John D. Dingell (D-Mich.), is thinking about dispatching its own team of investigators to take a look at USC and the University of Pennsylvania, whose overhead charge rates last year were 65% and 63%, respectively.

At a hearing of Dingell’s panel Wednesday, Stanford was accused of overcharging the government by more than $160 million in research overhead during the last decade. The panel noted that the charges included such “outrageous” expenses as acquiring an Italian fruitwood commode and enlarging the bed for Stanford President Donald Kennedy at his official residence.

There were also newly leveled allegations that Stanford gave a “free ride” on research fees to the Japanese government and several private firms while it was bilking U.S. taxpayers on costs of federally sponsored research.

Kennedy, caught by surprise when Dingell laid out the new charges, issued a rebuttal in a statement Thursday, suggesting that the congressman had been inaccurate and unfair.

Dingell said that Stanford had conducted research for Japan and Matsushita, a Japanese electronics firm, without charging them for overhead costs.

The lawmaker also asked about overhead fees being waived on research done for Weight Watchers International, three drug firms and “that impoverished corporation Exxon.”

Singling out the Weight Watchers grant, which involved an obesity study at Harvard Medical School, Dingell asked: “Why not give similar benefits to the federal government for AIDS research?”

At the hearing, Kennedy responded that he was unfamiliar with the grants and would check them out.

In his statement Thursday, Kennedy said that the Japanese government grant was for “a cultural and educational project involving training (U.S.) teachers to educate children about Japan.”

The Matsushita grant was from a nonprofit U.S. foundation of the firm that “makes grants in this country for charitable purposes.”

Similarly, the waivers for Exxon and Weight Watchers were nonprofit foundations of the entities, he added.

Kennedy said that total waivers of overhead charges last year were “only $40,000 for foreign sponsors and almost $7.5 million for the U.S. government.”