Fringe Rate and Impact on Research Grants

October 28, 2021

Dear RBHS Colleagues:

A number of you have reached out to us and shared your concerns about the ever-escalating fringe rate in New Jersey, and their impact on research grants. We share those concerns.

As you know, the fringe rate reflects the actual amounts paid by the state for health, pension, and other benefits for all state employees. The rate has grown dramatically over the past few years as the state has moved to fully fund the cost of the public employee pension systems and as the cost of employee health benefits has increased.

The rate for the current Fiscal Year, while not approved so far, is anticipated to go up significantly and these charges will retroactively be applied to research awards. In attempt to try to ameliorate the financial hardship this puts on your current research funding, the University was successful for the first time ever in securing some fringe relief in the current state budget. The relief is in the form of a one-time appropriation to be shared among the state’s four research universities. We hope that once the funding is released by the state, it can at least partially offset the impact of the fringe rate increase on our funded research investigators. While this will not offset the increased expense completely, it will hopefully provide some relief once officially approved and received.

Importantly, please know that our university is diligently working with both the legislative and executive branches to secure long-term fringe relief by striking a rate that accurately reflects the profile of employees in higher education. Employees in the higher education sector by and large have lower pension costs than typical state employees.

We are hopeful that our collective efforts will be successful, and remain concerned over the impact the state’s uncompetitive fringe rate has on research grants. Additional information will be provided as soon as available.

Sincerely,

Kathleen Bramwell
Senior Vice Chancellor for Finance and Administration

Bishr Omary
Senior Vice Chancellor for Academic Affairs and Research

Brian Strom
Chancellor, Rutgers Biomedical and Health Sciences