Sunday, July 30, 2006 | 7:39 a.m.
The UNLV Institute for Security Studies, under fire for its free spending of federal money and for a lack of accountability, is housed within a branch of the university that is the subject of similar, if less severe, criticism for its use of tax dollars.
UNLV's Research Foundation was created four years ago to find money for scientific and technological research - and to convert that research into something useful or profitable. It was a major step forward in UNLV's drive to elevate its mission from merely teaching students to also contributing to knowledge and developing new products.
Foundation and university officials boast that the foundation has brought in $48.3 million in federal money to UNLV over the last three years. But a Sun investigation has found that more money has been directed to private companies or earmarked for administrative overhead costs than has reached UNLV to pay for research and equipment.
Of the $48.3 million, $10 million - more than 20 percent - has been set aside for start-up costs and administrative overhead, including salaries much higher than those paid at the university.
Of the remainder, $19 million is earmarked for research at UNLV, about a third of which was also diverted for administrative overhead costs, further eroding money for the intended research.
The other $19 million has gone to private companies, other universities or federal laboratories because UNLV did not have the expertise to conduct the research - even though the foundation applied for the federal grants on behalf of UNLV.
UNLV officials have recognized some of the problems and are taking steps to correct them. Critics say more problems remain and note the similarity to troubles at the beleaguered Institute for Security Studies. Up until May, the director of the foundation doubled as the director of the security institute.
In its pursuit of grants, the Research Foundation has served as a middleman to connect UNLV talent with Energy Department research needs, broadening UNLV's research portfolio into such areas as hydrogen fuel cell research, nuclear and renewable energy and nanotechnology. The Research Foundation also helped UNLV officials identify how to develop their administrative staff to help researchers compete for grant money.
But its successes are tempered by stumbles.
The Research Foundation "is just a clearinghouse for funneling this money and very little is going for the purpose it was meant for, which is to do research," Regent Steve Sisolak said. "The taxpayer is getting cheated. Cheated with a capital C."
With approval from the foundation's board of trustees, UNLV officials began reorganizing foundation operations about 16 months ago to rein in administrative costs, said Mark Rudin, interim vice president of UNLV's internal office of Research and Graduate Studies.
Most significant, by 2007 all grants will flow through and be administered by Rudin's office, thereby eliminating the foundation's practice of skimming overhead costs off the top. UNLV is in the process of taking control of those grants.
Conversely, the business of promoting commercial applications of campus research is being shifted to the Research Foundation because the foundation is better situated legally to deal with private companies.
Research Foundation officials also are refocusing on the development of the university's languishing research park.
If the foundation was adrift, some blame its executive director, Thomas Williams.
Buck Wong, a former chairman of the Research Foundation, said Williams evaded board members and preferred to report only to UNLV officials.
For his part, Williams said, he may have lacked some of the collegiality board members wanted. As part of the overhaul of the Research Foundation, then-UNLV President Carol Harter moved Williams to an associate vice president position under Rudin, allowing Williams to continue to use his Energy Department contacts to help UNLV secure grants while allowing the foundation to hire someone with more experience in private-public partnerships to develop the research park. That switch was made official in May with the hiring of Bud Pittinger, who previously helped the Baylor School of Medicine develop its new medical clinic.
Williams remains interim director of the Institute for Security Studies.
Harter and foundation officials say UNLV'S own inexperience as a research institution contributed to the foundation's problems.
"There is a sense here of a growing, developing organization that made some mistakes and made some false starts but not out of ill will or false motives but because of a new and maturing university feeling its way to maturity," Harter said.
The foundation's most glaring missteps involve its Institute for Security Studies, which is under fire from regents and Energy Department officials for having dropped many of its homeland security training and research initiatives. Chancellor Jim Rogers and university regents have requested full audits of both the institute and the Research Foundation, and will discuss the matter at a hearing Friday.
"There could be legitimate answers to the questions, but at least superficially, there is a concern," Regent Michael Wixom said of confusion over the security institute's current agenda and the Research Foundation. "It certainly begs a lot of questions, and it begs scrutiny."
The Research Foundation began in 2002, when Nevada Test Site Manager Kathleen Carlson loaned Williams, then an executive with the National Nuclear Security Administration, to UNLV to explore the idea of creating a private, nonprofit foundation to help UNLV develop a research park on Bureau of Land Management land.
When Williams arrived in July 2002, Harter and other administrators were already in talks with Senate Minority Leader Harry Reid, D-Nev., to secure 115 acres in the southwest corner of the valley.
The goal was - and is - to link UNLV's research interests with emerging biomedical, pharmaceutical and advanced technology companies. UNLV professors and students would conduct research with those companies, and company researchers would teach at UNLV.
The foundation also was intended to help UNLV secure patents on its discoveries with an eye toward profiting from new commercial products. As a separate, private entity, the foundation would help UNLV incubate new businesses and churn research into economic development - something UNLV itself is forbidden to do because state entities are not allowed to own any part of a private company.
The foundation also was to support research activity at UNLV by attracting and administering grant funds and equipment on the university's behalf - and to keep those funds out of the grasp of the state, which at the time was taking a cut of the grant money as a sort of tithe to cover indirect overhead costs such as maintaining campus buildings.
Central to its mission was to nurture UNLV's research capabilities so the university could better compete for federal grants.
In February 2003 Williams retired from the federal government to become executive director of the foundation. Incorporated that October, the foundation is governed by its own board but is answerable to the Nevada System of Higher Education Board of Regents. The Board of Trustees includes five high-ranking UNLV administrators, including the president and the foundation's executive director, and six community leaders.
The foundation was initially funded with a $50,000 loan from the UNLV Foundation, the university's fundraising arm, and with grant money from the now-defunct Nevada Test Site Development Corp.
But with Reid's help and Williams' experience and connections with the Energy Department, federal grants flowed in. The foundation received money to research hydrogen fuel cells, solar technology, radiochemistry, photonics, earthquake risks and homeland security.
To help win grants, Williams frequently matched UNLV professors with researchers in private businesses or at other universities and brought in outside consultants. Better, he said, to shove UNLV's foot in the research door with the help of outsiders than to turn down grants because of a lack of on-campus expertise.
He believed he could raise UNLV's reputation as a research university even if the people working on the Energy Department grants weren't from UNLV.
"We have tried to knit ourselves to the federal programs that sponsor these funds," Williams said in an interview last week. "What universities do best is go off and look for answers to specific questions. Eventually, if it has value in the marketplace, someone will pick it up and sponsor it. In our case, we are trying to create value in the marketplace so people will come and do work with us without us having to get" federal funding, known as earmarks.
When asked whether it was disingenuous to seek grants that couldn't be fulfilled at UNLV, Williams said the strategy would help UNLV develop expertise by connecting professors with outside experts, whom he compared to adjunct faculty.
By keeping about $10 million of the $48.3 million in grant funds, the foundation has supported a 27-person administrative staff. It handles grant paperwork and coordinates reporting among UNLV, private companies and other universities involved with the research.
Of the remaining grant funds passed on to UNLV, the university charges each researcher a fee, often equal to 30 percent of the grant, to help cover facility costs and administrative overhead. About 65 percent of those administrative dollars are reinvested into research, including maintaining or building new laboratories, providing start-up grants for researchers or covering the cost of equipment.
UNLV researchers say they have quibbled with foundation officials about the amounts being taken out of their grants for administrative costs, but stressed that the foundation also has helped researchers compete for grant money by cutting through red tape.
"Of course as a dean I'd like every penny to go into actual research," said Eric Sandgren, dean of the College of Engineering and principal investigator on a grant to study the safety risks of transporting nuclear waste to Yucca Mountain. "But while we may have great researchers, many aren't good at writing reports. They (the Research Foundation staff) are doing work that needs to be done."
Sandgren and other researchers say they are glad UNLV is taking control of the grants. Some researchers, including nuclear engineering professor Anthony Hechanova, believe that the Research Foundation was too quick to turn grants over to private companies rather than steer them to UNLV researchers.
The Research Foundation's payroll for 27 workers is about $2.4 million - about $400,000 more than the payroll for 41 persons employed by UNLV's Research and Graduate Studies office, primarily because the foundation's staff includes specialists assigned to the Institute for Security Studies.
Ron Bell, former director of Georgia Tech's Research Foundation and a national consultant who helped UNLV develop its Research Foundation, said its administrative expenses were normal for a start-up research foundation. Reid said he was not alarmed by the foundation's costs. Energy Department officials did not return repeated requests for comment.
Despite criticisms of how much grant money was kept by the foundation for administrative overhead, Rudin said that it nonetheless "brought a new way of looking at things, a new way of doing things and a new excitement to the research mission at UNLV."
Turning research into commercial pay dirt, one of the foundation's chief missions, seems lost amid the demand of managing research grants. The Research Foundation has secured only a handful of outside contracts for homeland security-related initiatives that were mostly subcontracted out to private companies, and only a few provisional patents in the last three years.
The research park, where UNLV researchers would share offices and laboratories with rent-paying commercial research companies, remains a hardscrabble parcel at Durango Drive and Sunset Road.
The development stalled for three years because UNLV didn't receive title to the 115-acre site until last summer, and then had to win zoning approval. Groundbreaking may still be a year away.
Because of the delays, Nevada Development Authority President Somer Hollingsworth said his organization stopped pitching the research park to companies thinking of moving to Las Vegas.
Pittinger, Harter, Williams and Rudin admit there have been mistakes with the Research Foundation, but chalk it up to a learning curve.
"There is no owner's manual here," Williams said. "We've had fits and starts, and experimented and tried to figure out what works. I think we have found a good model."
But there is no minimizing the problems surrounding the Institute for Security Studies, which has received $8.9 million in mostly federal money but has abandoned many of its initial plans, such as a master's degree in emergency management.
Despite $8.9 million in grants, the unit can't cite significant advances in technology development and has dropped key research goals such as looking at the psychological and social ramifications of terrorism and the relationship between terrorism and the Internet.
UNLV's new president, David Ashley, will spend his first meeting before the Board of Regents explaining the institute and the steps he is taking to fix the foundation.
Ashley says he is dedicated to developing UNLV's reputation as a research university. He says it may require pruning back some of its research projects in order to excel at a chosen few.
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