COMMITTEE ON GOVERNMENT OPERATIONS

WILLIAM L. DAWSON, Illinois, Chairman

CHRISTINE RAY DAVIS, Staff Director
JAMES A. LANIGAN, General Counsel
MILES Q. ROMNEY, A880ciate General Counsel
J. P. CARLSON, Minority Counsel
RAYMOND T. COLLINS, Minority Professional Staff

CONTENTS

Statement of—

Price, Dr. David E., Deputy Surgeon General, Public Health Service;

accompanied by Donald F. Simpson, executive officer; Dr. Berwin

A. Cole, Acting Grants Policy Officer; and Paul Fox, Chief, Division

of Internal Audits, Public Health Service; also Dr. John F. Sherman,

Associate Director for Extramural Programs, National Institutes

of Health; accompanied by Dr. Frederick L. Stone, Acting Chief,

Division of Research Facilities and Resources; and Dr. B. Pahl,

Chief, General Research Support Branch, Division of Research

Facilities and Resources; also James L. Thompson, Jr., Director

of Audits, Department of Health, Education, and Welfare; accom-

panied by John J. Mallen, Office of Financial Management.

Terry, Dr. Luther L., Surgeon General; accompanied by Dr. David

E. Price, Deputy Surgeon General; Donald F. Simpson, Executive

Officer; Dr. Berwin A. Cole, Acting Grants Policy Officer, Public

Health Service; and Dr. John F. Sherman, Associate Director for

Extramural Programs, National Institutes of Health----

Letters, statements, etc., submitted for the record by-

Cole, Dr. Berwin A., Acting Grants Policy Officer, Public Health

Service: Department of Defense audited rate for the Buffalo

division of Health Research, Inc...

Fountain, Hon. L. H., a Representative in Congress from the State

of North Carolina, and chairman, Intergovernmental Relations

Subcommittee:

Correspondence between Hon. L. H. Fountain and the Public

Health Service, Department of Health, Education, and Welfare:

Information on status of NIH's actions with respect to

indirect cost payments to grantee institutions reported to

Congressman Fountain as having indirect cost rates of less

than 15 percent. August 17, 1964--

Letter from Dr. David E. Price, Acting Surgeon General, to

Hon. L. H. Fountain:

Page

72

2

54

96

Jan 30, 1964.

February 16, 1965_

May 13, 1965.

Letter from Dr. Luther L. Terry, Surgeon General, to Hon.

L. H. Fountain:

March 9, 1965 (with attachments)..

100

Letter from Hon. L. H. Fountain, to Dr. Luther L. Terry:

August 20, 1962_

10

Supplemental information furnished by Berwin A. Cole,

Ph. D., November 19, 1964, re overpayments to eight

institutions___

Excerpt from conference report, July 31, 1962..

III

Letters, statements, etc., submitted for the record by-Continued
Fountain, Hon. L. H., etc.-Continued

Excerpt from opinion by Assistant General Counsel Edward J.
Rourke, April 3, 1963-.

Excerpt from Health Research, Inc., letter, October 30, 1963..

Excerpt from House Report No. 1958, June 30, 1962..

Excerpt from statement of Dr. Luther L. Terry.

Page

56

Excerpt from policy statement on general research support

grant_

107, 108

108

9

7

71

56

59

Excerpt of letter from Dr. Luther L. Terry, to Hon. L. H. Foun-
tain, March 9, 1965---

Opinion from Charles M. Gozonsky, Office of the General Counsel,
to John W. Finn, February 8, 1963--

Opinion from Edward J. Rourke, Assistant General Counsel,
to Donald F. Simpson, April 3, 1963.

PPO No. 39, Policy, August 20, 1962-Indirect cost allowances

for research grants, revised provisions included in the 1963

appropriation act...

Principles for determining costs applicable to research and devel-

opment under grants and contracts with educational institu-

tions, March 3, 1965 (Bureau of the Budget Circular No. A–21

(revised))

Fox, Paul, Chief, Division of Internal Audits, Public Health Service:

Functions of NIH's Management Survey and Review Branch..........

Goldberg, Delphis C., professional staff member, Intergovernmental

Relations Subcommittee:

An analysis of data on fiscal year 1965 NIH research grants to

selected institutions__

11

19

119

124

Letter from C. R. Seater, Assistant Executive Officer, Public
Health Service, to Dr. D. C. Goldberg, January 17, 1961.
Organizational description of Health Research, Inc. -
Report on Public Health Service research contract policies__

Sherman, Dr. John F., Associate Director for Extramural Programs,

National Institutes of Health:

Excerpt from PPO No. 39.

51

8

Indirect cost rates for grants performed at VA installations.
Memorandum from John F. Sherman, Ph. D., National Institutes

of Health, to Institute Directors and others concerned, Decem-
ber 2, 1964, re authorized indirect cost rates.

Simpson, Donald F., Executive Officer, Public Health Service:
Conparison of BOB Circular A-21 and Armed Services Procure-
ment Regulations...

Information re indirect cost rate for contracts at Health Re-

search, Inc., Buffalo, N. Y.

Memorandum from Charles M. Gozonsky re Health Research,

Inc

Stone, Dr. Frederick L., Acting Chief, Division of Research Facilities

and Resources, National Institutes of Health: Reasons for dis-

allowance of $1,947,495 item from general research support grant

to HRI..

Thompson, James L., Jr., Director of Audits, Department of Health,

Education, and Welfare: Evolution of audit of Public Health Serv-

ice research grants...