We have just completed submission of several noncompeting continuations
at NIH and this subject came up. All projects funded with start dates on
or after October 1, 1997 will be caluclated using a 3% escalation
factor. Multiyear awards with earlier start dates will use the
escalation factor approved when the initial award was made.

In the course of these discussions, I learned there is discussion at NIH
that the escalation factor may be set lower than 3%. I think that may
create problems in the future and suggested NIH consider establishing 2
escalation factors:  one for salaries, a second for everything else. I
think limiting salary increases to less than 3% will make it difficult
to hold on to good support personnel as well as result in the % of
salary of PIs recovered decrease through the life of a project.

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*  Bill Caskey                                                        *
*  Director, Research & Grants Administration    *
*  The Children's Mercy Hospital                          *
*  2401 Gillham Road                                           *
*  Kansas City, MO  64108                                  *
*  Voice:       (816) 234-3879                                   *
*  FAX: (816) 855-1982                                   *
*  E-mail:      xxxxxx@cmh.edu                             *
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