That's the money for salaries of its 48 employees, outside contracts (the second biggest item in the budget), monitoring grant performance and so forth. The agency is limited by law to spending only six percent of its $3 billion for overhead, an amount that many of its directors think is low, perhaps even inadequate. The limit was enshrined in state law by Prop. 71, the measure that created the stem cell research program in 2004.
That said, the agency has had difficulty in presenting a coherent proposed budget to its directors in a timely fashion. It has given them proposals that do not compare actual spending to proposed spending and which produce dubious numbers for the amount of increased spending. The proposed budgets, which are for fiscal years that begin July 1, have come late and have not allowed time for thoughtful examination by the CIRM governing board. (See here, here and here.)
This year promises an improvement. CIRM President Alan Trounson presented a schedule for the budget at the board's March meeting. It calls for presentation of the budget to the directors' Finance Subcommittee later this month with presentation to the full board in May. That is a full month ahead of what occurred in the past several years. It also allows time for the directors to ask for revisions that could be presented to them in June, before the beginning of the new fiscal year.
Michael Goldberg, a venture capitalist and chairman of the Finance Subcommittee, said he expects the panel to meet on April 19 to consider Trounson's proposed spending plan for 2011-12. Spending fror the current year was originally budgeted at about $16 million. Spending for the coming year should show increased costs for staff, given the new hires expected this year and the addition of a new vice president for research and development. Increased pension contributions for the agency staffers will also boost compensation expenses.
John Robson, vice president for operations, additionally told directors in March,
"Our number of progress reports has increased significantly, our grant and loan payments, those things impact significantly on the grants management office, the science office, and the finance office. The increase in work has gone up 25 to 35 percent just in the last year."He continued,
"We also have a couple of one-time items that are going to be reasonably expensive. We have a performance audit that was stipulated by (state Senate) bill 1064. That's budgeted at about 250,000, and then there's the Institute of Medicine audit that the board has been working on, the chair's office, and we've budgeted 400,000 for that for this year with the balance...in the next fiscal year's budget."Also likely to be discussed at the April 19 meeting is the near certainty that the state will not issue bonds until sometime in 2012, a situation that could bring CIRM perilously close to a serious cash flow crunch.
The agency's only source of funds is money that the state borrows (bonds). CIRM says it has sufficient cash on hand to meet existing commitments until June of 2012, but a delay in issuance of bonds could mean a slowdown in CIRM's aggressive grant schedule or worse.
In response to a query, Goldberg said.
"We are watching the situation closely."