Order Code RS21267
Updated May 4, 2007
National Science Foundation: Major Research
Equipment and Facility Construction
Christine M. Matthews
Specialist in Science and Technology Policy
Resources, Science, and Industry Division
Summary
The Major Research Equipment and Facilities Construction (MREFC) account of
the National Science Foundation (NSF) supports the acquisition and construction of
major research facilities and equipment that are to extend the boundaries of science,
engineering, and technology. The facilities include telescopes, earth simulators,
astronomical observatories, and mobile research platforms. Currently, the NSF provides
approximately $1.0 billion annually in support of facilities and other infrastructure
projects. While the NSF does not directly design or operate research facilities, it does
have final responsibility for oversight and management. Questions have been raised by
many in the scientific community concerning the adequacy of the planning and
management of NSF facilities. In addition, there has been debate related to the criteria
used to select projects for MREFC support. H.R. 1867, the National Science
Foundation Authorization Act of 2007, directs the National Science Board to evaluate
NSF’s current policies for allocation of costs, and management and operation of major
research equipment and facilities. This report will be updated periodically.
Background. The Major Research Equipment and Facilities Construction
(MREFC) account of the National Science Foundation (NSF) was established in FY1995
and supports the acquisition, construction and commissioning of major research facilities
and equipment that are to extend the boundaries of science and engineering. Major
research facilities are complex in their design, construction, and operation and require a
large investment over a limited period of time. Examples of some of the funded projects
include telescopes, research vessels, accelerators, networked high-tech research platforms,
advanced computing resources, astronomical observatories, and earthquake simulators.
These complex projects sometime involve the participation of international partners.
Currently, the NSF provides approximately $1.0 billion annually in support of facilities
and other infrastructure projects. The funding for construction of individual facilities
ranges from several tens of millions to hundreds of millions of dollars. Additional
funding is required annually for operation, maintenance, upgrades and retooling of the
facilities.

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With the significant exception of research facilities in the Antarctic, the NSF does
not directly design or operate research facilities. Rather, it makes awards to other
organizations such as universities, consortia of universities, or nonprofit organizations
which have the responsibility of construction, operation and management. The NSF
enters into cooperative agreements with these external entities, and has the final
responsibility for oversight of the development, management and performance of the
facilities.
During the past few years, NSF’s portfolio of facilities has expanded and diversified
to include complex multidisciplinary projects and distributed projects. Because these
major facility projects are multi-year, their accounting, management and oversight require
more complexity and detail than the traditional average grant award. There are concerns
from Congress and from some in the academic and scientific community about the
adequacy of the planning and management of NSF facilities. Discussions have focused
on how major facility projects are selected for funding. Other questions have centered
on the types of costs to be funded through the MREFC account and NSF personnel
involved in major facility projects. In the FY2002 budget submission, President Bush
directed the NSF to develop clearer policies and procedures for managing all aspects of
large facility projects, including funding controls and effective project management.1 The
FY2002 budget document, A Blue Print for New Beginnings: A Responsible Budget for
America’s Priorities
, directed that “NSF will develop a plan to enhance its capability to
estimate costs and provide oversight of project management and construction. This plan
should help ensure that NSF is able to meet and stick to cost and schedule commitments
for major facility projects.”2
Definition of a Major Research Facility. The MREFC is an agency-wide
capital asset account that funds major science and engineering infrastructure projects that
cost more than one program’s budget could support.3 Major research facility projects are
defined as those awards made for establishing and/or operating a major tool or facility that
will potentially benefit a community of researchers and/or educators. A project should “...
[O]ffer the possibility of transformative knowledge and the potential to shift existing
paradigms in scientific understanding, engineering processes and/or infrastructure
technology.” 4A research facility is considered “major” if its total cost of construction
and/or acquisition constitutes an investment that is more than 10% of the annual budget
of the sponsoring directorate or office. The majority of large facility projects are funded
1 In December 2000, the Office of Inspector General (OIG) of the NSF released an audit of the
Gemini Project, reporting that the Gemini Project had cost overruns exceeding its approved
construction level of $184 million. The OIG further stated that the NSF had used or was planning
to use approximately $52.8 million from the Research and Related Activities Account (RRA) to
cover the excess construction and commission costs. NSF management refuted the conclusions
of the OIG, maintaining that the excess costs were operational in nature and as a result, properly
supported through the RRA as opposed to the MREFC account.
2 Office of Management and Budget, A Blueprint for New Beginnings: A Responsible Budget for
America’s Priorities,
Washington, February 28, 2001, p. 161.
3 The proposed facilities are too large to fit within the account of any one directorate or program.
The concern is that support for such large projects would “disrupt” the budgets of other programs
and jeopardize NSF’s traditional support of “core” research programs.
4 National Science Foundation, Facility Plan, September 2005, Arlington, VA, p. 6

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through the MREFC, but some also receive support through the Research and Related
Activities Account (RRA).5
Congressional Hearing on Planning and Management Issues. On
September 6, 2001, the House Committee on Science, Subcommittee on Research, held
a hearing on planning and management issues associated with major research facilities
at the NSF. These hearings resulted from concerns expressed by some in the academic and
scientific community and in Congress about the management and oversight of major
projects selected for construction and the need for prioritization of potential projects
funded in the MREFC. In testimony before the Subcommittee on Research, then NSF
Director, Rita R. Colwell, stated that the draft of the Large Facility Projects Management
and Oversight Plan
codifies practices already in place and develops new guidelines for
oversight of financial and business functions. She responded to criticism that the lines
of authority for project management included in the draft plan were ambiguous and that
those with oversight functions for the projects were program officers who may not have
the expertise necessary for overseeing a complex project. The Plan established a new
position — Deputy Director for Large Facility Projects. Under the Plan, the Deputy
Director would be responsible for implementing and managing guidelines and procedures
for facility management and oversight, maintaining lines of authority for facility
management, and providing project management training for NSF staff engaged in large
facility projects.
There has been considerable debate concerning the selection of major research
facility projects for funding. In testimony before the Subcommittee on Research, Anita
K. Jones, then Vice Chair, National Science Board (NSB), stated that because not all
facilities can be built at the time they are considered, the NSB established guidelines for
approving major facility projects.6 She emphasized that there is a prioritization process
for selecting major projects, one that involves the NSF and the community, with the NSB
actually making the priority decisions. The NSB, she asserted, reviews the need for the
facility, the research that will be enabled, the readiness of plans for construction and
operation, construction budget estimates, and operations budget estimates before making
its decisions. Another issue brought before the Subcommittee was that of maintaining
distinct records of spending activities in the MREFC. Subcommittee members questioned
the types of costs to be funded through the MREFC account because the differentiation
5 Since its establishment, the MREFC has funded the following projects: Atacama Large
Millimeter Array (ALMA), IceCube Neutrino Detector R&D, High-Performance Instrumented
Airborne Platform for Environmental Research (HIAPER), Large Hadron Collider, Terascale
Computing System and Distributed Terascale Facility, Laser Interferometer Gravitational Wave
Observatory (LIGO), George E. Brown, Jr. Network for Earthquake Engineering Simulation
(NEES), Polar Support Aircraft Upgrades, South Pole Safety Project and South Pole Station
Modernization, EarthScope, National Ecological Observatory Network (NEON), the Gemini
Observatory, the Scientific Ocean Drilling Vessel (SODV), the Alaskan Region Research Vessel,
and the Ocean Observatories Initiative. The FY2008 budget request provides funding for one
new start – Advanced LIGO.
6 National Science Board, Guidelines for Setting Priority for Major Research Facilities, NSB01-
204, Arlington, VA, November 15, 2001, 2 pp.

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between construction and operation is not always clearly defined.7 The Subcommittee
noted that internal mechanisms needed to be created in order to prevent the combining of
MREFC and RRA funds.
Audit of Funding for Major Research Equipment and Facilities. In May
2002, the NSF’s Office of Inspector General (OIG) released a draft report, Audit of
Funding for Major Research Equipment and Facilities
.8 The report noted that the current
policy for major research equipment and facilities projects is limited to only the MREFC
and does not include major facilities for other programs in NSF. In addition, the existing
guidelines stipulate a single financial review and do not offer directives on how the
review should be conducted. Also, according to the audit, the current policies did not
provide direction to NSF program mangers on how to address the problem of potential
cost overruns. While federal guidelines require that the total cost of major research
facilities be tracked through all stages of a project, NSF’s policies and procedures did not
provide full accounting costs in its financial reports in accordance with federal standards.
Because of NSF’s inconsistences in tracking costs and funding sources of its major
research facilities, the OIG recommended that NSF revise its policies and procedures by
complying with the directives that were detailed in the FY2002 appropriation bill.
Congressional Activity. In June 2002, Congress requested the National
Academy of Sciences (NAS) to review NSF’s management of its large facility projects.9
The study began in February and examined how the NSF sets priorities in determining
which competing projects to fund, and offered recommendations on how to strengthen the
process. The recommendations are contained in a January 2004 report prepared jointly
by the NSB and the NSF – Setting Priorities for Large Research Facility Projects
Supported by the National Science Foundation.
10 At an October 2004 meeting of the
NSB, the NSF was directed to begin implementation of the proposed large facility project
review and prioritization process outlined in the report. The report revealed that in
addition to there being a backlog of approved but unfunded projects, there was a lack of
support for disciplines conducting idea-generating activities, and lack of funding for
conceptual development, planning, and design.
Planning and Management Issues. The November 2005 report, Guidelines
for Planning and Managing the Major Research Equipment and Facilities Construction
Account (MREFC),
details the procedures by which large facility research projects
7 Acquisition, construction and commissioning are funded through the MREFC. Planning,
design, and development are supported through the R&RA, in addition to operations and
maintenance upon completion of the project.
8 National Science Foundation, Office of Inspector General, Audit of Funding for Major Research
Equipment and Facilities
, OIG02-2007, May 1, 2002, Arlington, VA, 17 pp.
9 The NSF Authorization Act of 2002 (P.L. 107-368, H.R. 4664) contained language directing
the NAS to conduct the study of NSF’s priority-setting process of its large facility projects.
10 National Academy of Sciences, Committee on Science, Engineering, and Public Policy, and
Global Affairs Division, Board on Physics and Astronomy, Setting Priorities for Large Research
Facility Projects Supported by the National Science Foundation
, Washington, DC, January 14,
2004, 215 pp.

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advance through a multi-phase internal and external review and approval process.11
According to the Guidelines, a MREFC Panel evaluates the projects based on, among
other things, project definition, intellectual justification, connection to NSF strategic goals
and priorities, life-cycle cost profile, partnerships, and project management plans,
schedules, and reviews. Based on the review, the MREFC Panel submits to the NSF
Director its recommendation on the project’s relative importance, eligibility, and
readiness, with readiness defined as its ability to be included in the upcoming budget
request. The Director then makes the selection of projects based on: 1) strength and
substance of the information; 2) the appropriate balance among various fields, disciplines,
or directorates; and 3) opportunities to leverage MREFC funds. The Director submits his
selections to the NSB for project approval. After the NSB approves a project for future
budget cycle funding, it prioritizes among the projects.12 On an annual basis, the NSB
reviews all NSB-approved projects that have not been funded as yet to determine if any
changes are necessary to the priority order of the projects. 13 If a project is not approved,
or if a project’s plans are no longer determined to be “clearly and fully construction
ready,” the project will be returned to the preliminary design/readiness phase for
additional work. A project can be resubmitted to the NSB the following year. While the
NSB may approve a project for inclusion in a future budget request, it does not necessarily
mean that it will receive funding in the upcoming budget request. It does indicate that the
project is to be considered for inclusion, depending on current budget levels and
constraints.
In February 2007, NSF released its second annual Facility Plan.14 The Plan covers
readiness stage projects through those projects that are in the process of completion. The
2007 Facility Plan describes NSF’s goals and strategies for incorporating the existing
approaches and practices into a system for selecting, managing, and overseeing large
facility projects to make certain that a large facility is both constructed properly and is the
appropriate facility to build. The Facility Plan is consistent with the vision detailed in the
NSF Strategic Plan, Investing in America’s Future, FY2006-FY2011.15 The projects
under construction and those being considered for construction are indicative of NSF’s
long-term investment priorities for new capabilities and next-generation facilities that will
“transform research in science and engineering.” The Facility Plan states that:
11 National Science Foundation, Guidelines for Planning and Managing the Major Research
Equipment and Facilities Construction (MREFC) Account
, Arlington, VA, November 22, 2005,
29 pp. NOTE: The final management document, the Facility Manual, which will include the
MREFC Guidelines, is scheduled for release in FY2007.
12 First priority is given to projects under construction. Second priority is for NSB-approved new
starts. There are projects that are classified as being in the readiness stage or recommended for
advancement to the readiness stage. Also, there are projects classified as being under
exploration.
13 The Office of Management and Budget (OMB) may reject or change the NSF’s prioritizations.
14 National Science Foundation, 2007 Facility Plan, NSF07-22, February 2007, Arlington, VA,
53 pp.
15 National Science Foundation, Investing in America’s Future - Strategic Plan FY2006-2011,
NSF06-48, September 2006, Arlington, VA, 20 pp.

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As in any sort of exploration, the horizon keeps moving. Every year new
opportunities will arise and new priorities will assert themselves. As a result, no
roster of potential projects is ever final .... This process of identification and selection
is, and must be, continuously repeated.16
The 2007 Facility Plan describes a team approach and details the cooperation
between the scientific and technical staff and the business operations staff. The lines of
authority and responsibility are defined for the NSF Director, the participating Division
Director, the NSF Program Manager, and the awardees’ project director. In every large
facility project, the NSF Program Manager, with the support of the participating Division
Director, has primary responsibility for all aspects of management. In addition, the NSF
Program Manager is responsible for determining whether the project director and project
management staff have the necessary training and skills for working on the project.
Termination of a Major Research Project. The Rare Symmetry Violating
Processes Project (RSVP) was initially NSB-approved for funding in October 2000, and
was included in the FY2005 budget request as a new construction project. The RSVP
would involve the incremental use of the existing Alternating Gradient Synchrotron at
Brookhaven National Laboratory. In the fall of 2004, while the RSVP was in the design
phase, an analysis revealed that there could be significant increases in both construction
and operating costs. The cost overruns generated interest by several congressional
committees and the international scientific community. An evaluation was conducted by
scientific personnel both internal and external to NSF in an attempt to resolve the cost
increases in various elements of the project. In August 2005, on the recommendation
from NSF management, the NSB terminated the RSVP. NSF determined that
“[C]ontinuing the RSVP project would lead to the unacceptable loss of opportunities in
research in elementary-particle physics, other areas of physics, and across all disciplines
in the [Mathematical and Physical Sciences] directorate as well as in the construction of
large facilities across NSF.”17 The RSVP underwent a series of phase-out activities.
MREFC Support in the FY2008 Budget Request. The FY2008 budget
request for the NSF provides funding for six ongoing projects : Alaska Region Research
Vessel ($42.0 million); the Atacama Large Millimeter Array ($102.7 million); the
IceCube Neutrino Observatory ($22.4 million); the National Ecological Observatory
Network ($8.0 million); the Ocean Observatories Initiative ($31.0 million); and the South
Pole Station Modernization project ($6.6 million). One new start has been requested in
the budget submission – Advanced LIGO ($32.8 million).
NSF Authorization. On May 2, 2007, the House Committee on Science and
Technology passed H.R. 1867 (H.Rept. 110-114), the National Science Foundation
Authorization Act of 2007. The bill authorizes a total of $21.0 billion for the NSF for
FY2008, FY2009, and FY2010. Included in the bill is $787.0 million for MREFC
(FY2008, $245.0 million; FY2009, $262.0 million; and FY2010, $280.0 million).
Language in the bill directs the NSB to evaluate the current policies for allocation of
costs, and management and operation of major research projects. A report of that
evaluation is to be submitted within six months following the enactment of the legislation.
16 2007 Facility Plan, p. 4.
17 Ibid., p. 31.