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Feds Question Graduate Student Reimbursement Policies: Are UC Grad Students Being Overpaid?

Melanie Egorin doesn't usually think about obscure government guidelines and audits. But when Egorin, president of the Graduate Student Association at the University of California, San Francisco (UCSF), learned of a new report that claimed UC graduate students were making too much money, she was perplexed.

On 29 June, the U.S. General Accounting Office (GAO) issued a report claiming that 24% of UC's graduate students working on federal research grants earned more than postdocs, violating guidelines set by the National Institutes of Health (NIH). The GAO values the "excess" payment to have cost taxpayers $20 million between 1995 and 1998.

Also: Do Foreign Students Receive More Federal Funds?

The yearlong investigation into policies at 10 of UC's campuses was requested by U.S. Representative Tom Bliley (R-VA), chair of the House Commerce Committee. "This compensation scheme is a misuse of government funds," Bliley said in a written statement. "In no case should a graduate student receive a total compensation package including salary, fringe benefits, and tuition payments that exceeds the total compensation it provides a person that has already completed the graduate requirements," he wrote in a letter to the White House Office of Management and Budget (OMB). Says GAO investigator Kevin Craddock, "It's like going to Burger King and having the new guy flipping burgers getting paid more than the shift manager."

The notion that graduate students are raking in the dough is ridiculous, says Egorin, a graduate student in UCSF's sociology department: "I have friends who qualify for food stamps." Graduate students in the biological sciences with full stipends at UCSF earn about $17,000 a year, which is less than $1000 a month after taxes. And these students do better than most UC students, Egorin adds.

The GAO report states that graduate students made between $13.40 and $18.65 per hour while supported by federal research grants, while "first-level" postdocs were paid between $12.98 and $13.72 per hour. GAO also noted that graduate students often receive fee and tuition remission (between $4400 and $14,500 per student), a benefit not received by postdocs.

Egorin contends that this type of comparison is misleading. She notes that while graduate researchers are routinely expected to put in 12-hour days at the lab, UC sets the "official" maximum work period at 20 hours per week. For accounting purposes, UC figures the hourly earnings of graduate students by dividing the yearly stipend into a 20-hour work week during the school semester and a 40-hour work week in summer. In contrast, the hourly pay for postdocs is based on a 40-hour work week, year-round.

The University of California takes issue with the report's methodology. The report undervalues pay for first-year postdocs by using figures for "step-1" postdocs, while most first-year postdocs make more, says university council Christopher Patti. Patti also questions GAO's use of what he calls an "informal" NIH standard, especially when the UC system only receives about half its federal research funds from the NIH. In addition, the report did not take into consideration postdoctoral fringe benefits like vacation and health care benefits.

A spokesperson in UC's Office of the President says the university system has no plans to change its reimbursement policies, which it claims are in accordance with current OMB guidelines.

Egorin thinks graduate students have been unfairly attacked. After all, students never see tuition and fee remissions, as they get moved around on paper: "It's just the wonderful shell game of academic money."

Do Foreign Students Receive More Federal Funds?

Representative Tom Bliley (R-VA) also asked the General Accounting Office (GAO) to investigate whether foreign students received a disproportionate share of federal research funds. The University of California (UC) says it does not distinguish between foreign and out-of-state students, although U.S. citizens can convert their residency after living in-state for 1 year (and graduate researchers tend not to begin working on federal grants until the second year of graduate training).

The GAO report found that foreign students represented 21% to 24% of graduate student researchers at the university between 1995 and 1998, but received 34% to 38% of federal reimbursements. This creates a built-in incentive to put foreign graduate students on federal grants, says Eric Wohlshlegel, spokesperson for the House Commerce Committee. "While it doesn't cost UC any more to educate foreign students, the school receives a much higher tuition reimbursement for these students," he says.

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