Business leaders in the North Country are sounding the alarm over a plan from the Trump administration to cap administrative costs for grants awarded by the National Institutes of Health, money used to research medical advancements and fund operations at facilities across New York.

In a letter sent to New York’s congressional delegation, the Business Council of New York, the Long Island Association, the Buffalo Niagara Partnership and various regional chambers of commerce said the proposed cap of 15% on administrative costs that can be paid for with NIH grants would decimate New York’s research facilities.

In the North Country, NIH grants fund tuberculosis and infectious disease research at the Trudeau Institute in Saranac Lake and cancer research at Clarkson University.

“They really rely on NIH funding for them to be able to do that research, which is leading to vaccines and treatments for these diseases,” said Joel Wood, vice president of strategic initiatives for the North Country Chamber of Commerce.

Statewide, more than 250 research organizations receive more than $3.5 billion in NIH grant funding each year. New York is the second-largest recipient of NIH grant funding, second only to California.

Data on how research groups use their NIH grants isn’t immediately available, and tends to vary between grant years, but on average historically, research institutions have agreed to use between 25% to 30% of their grant funding for indirect costs, like facility maintenance, administrative operations and other tertiary costs incurred by running a research program.

If capped at 15%, researchers have argued they would be unable to effectively operate their programs and would have to pare down their operations or close entirely. The Greater New York Hospital Association estimates that up to $850 million in state research funding could be pulled if the cap is kept in place, and the State University of New York would lose $7 million in funding.

Besides the economic impact of the lost funding, which would mean fewer high-paying research positions in upstate communities, state business leaders are worried about the long-term effects of stalled health research on the economy.

“When people are healthy, they can work, and when people are sick they can’t,” Wood said. “That’s a major economic driver, keeping people healthy is going to result in a healthy workforce that can generate economic activity. If we don’t remain at the cutting edge of this research, we’re going to see health issues become more widespread.”

In their letter to New York’s Republican and Democratic lawmakers, the state business community asked that the lawmakers stand with the business community and oppose the 15% cap on administrative costs for NIH grants, and maintain the status quo.

“We are hopeful that you will be a steadfast advocate for protecting these critical programs that support both our economy and the health of our workforce,” the letter closes.