Johns Hopkins, University of Maryland sue U.S. Department of Defense over research funding cuts
Johns Hopkins University and the University of Maryland, College Park are fighting to protect millions of dollars in federal research funding, according to a lawsuit.
The two universities, along with 10 others, are suing the U.S. Department of Defense and U.S. Defense Secretary Pete Hegseth over an attempt to slash indirect cost rates to 15% for research funded by the department.
In a memo issued on June 12, the Defense Department announced plans to cap the amount paid for indirect costs awarded on all research grants to 15%.
According to the lawsuit, UMD currently has a 56% indirect costs rate, and JHU has a 55% rate.
Indirect costs are resources used for operational expenses that are related to research activities.
In a statement, Johns Hopkins said these costs are "necessary costs of conducting groundbreaking research that has made our nation the world's leading military superpower."
How would cuts impact universities?
Johns Hopkins University said the funds help offset a broad range of costs essential for its research, including equipment and electricity for labs, technical expertise and technological infrastructure, and other basic operational expenses.
JHU said it has nearly 300 active Department of Defense grants totaling around $375 million across multiple years, with nearly half of that funding going to the School of Medicine and another 39% going to the Whiting School of Engineering.
JHU's negotiated indirect cost rate for Department of Defense research grants was expected to remain at 55% through Fiscal Year 2026.
Of the estimated $122 million in DOD funding that the university received in fiscal year 2024, nearly $90 million covered direct costs, and another $32 million accounted for the DOD's share of indirect costs. JHU co-invested to cover the remaining indirect costs.
Johns Hopkins expects to receive similar amounts of DOD funding in fiscal years 2025 and 2026. However, if indirect costs are slashed, JHU said it could lose about $22 million.
UMD receives approximately $125 million in DOD awards each year. The university could lose $7 million under Pete Hegseth's plan.
Johns Hopkins grapples with federal funding cuts
In February, Johns Hopkins University joined a federal lawsuit against the National Institutes of Health (NIH) after the agency announced that it would be limiting funding for indirect costs to 15%.
That effort was blocked by a federal judge on June 17 after multiple states and institutions filed similar lawsuits.
JHU lost more than $800 million from USAID grant terminations. Since January, 90 grants have ended, adding up to another $50 million in federal research funding.
The university has been one of the top recipients of research funding from NIH.
In June, the university announced it was pausing pay increases and reducing spending due to funding uncertainty.
