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Compliance office considers tiered approach to match‑expenditure reviews after disallowance rates fall
Summary
CPRIT compliance staff reported low disallowance rates on grantee match reviews and proposed moving from 100% reviews of match expenditures to a tiered, sampling‑based approach, citing rising match totals and potential federal changes to indirect cost rules.
Chief Compliance Officer (Mister) Burgess told the oversight committee Aug. 20 that CPRIT is reconsidering its prior practice of reviewing 100% of grantee match expenditures and moving toward a tiered, sampling‑based review because the agency’s disallowance rate has fallen to historically low levels.
Burgess said CPRIT manages roughly 540 active grants and about $1.5 billion under grants management. As of Aug. 1 the compliance office had 11 delinquent reports (below its internal 5% threshold) and had performed about 600 second‑level reviews with a 14% return rate. Desk reviews and enhanced desk reviews are now more rigorous than earlier iterations and can take several hours to several days depending on grantee responsiveness; on‑site reviews are planned and can take 2–3 hours for the on‑site portion with additional follow‑up.
Match expenditures reviewed by CPRIT have increased more than 70% year‑over‑year, from about $29 million to nearly $47 million, Burgess said — a substantial monitoring burden. Historically, match disallowance rates have dropped from 7.7% (FY21) to 0.1% this year. Burgess proposed a tiered review and increased sampling to balance compliance staff resources and oversight effectiveness.
Burgess also warned that proposed federal changes to the negotiated federal indirect cost rate (recently discussed at the federal level with litigation pending) could affect academic grantees that currently meet match requirements via high indirect cost rates. If negotiated rates are capped or changed, some academic grantees may need to provide additional hard‑dollar match or otherwise certify match funding; CPRIT staff said they will continue to monitor federal policy and adjust compliance practices accordingly.
The oversight committee did not take formal action on compliance policy at the meeting; staff will report final monitoring schedules and any proposed changes in a subsequent audit/subcommittee update.
