Wednesday, May 28, 2008

CIRM Lagging on Budget Preparation

The California stem cell agency is only one month away from a new budget year, but it has not yet presented to its directors a spending plan for the next 12 months.

This afternoon's meeting of the agency's Governance Subcommittee would have been a good time to offer the proposed budget. That would allow CIRM's directors to make suggestions for revisions and raise questions that might take time to answer.

Presumably CIRM President Alan Trounson will offer a spending plan in time for the June 26 board of directors meetings, but that will come only a few days before the financial year begins on July 1.

While it is too late to present a budget to the Governance Subcommittee, CIRM directors certainly can offer suggestions today about the type of information that they would like to see in the budget proposal, including a bit longer perspective than just the next 12 months.

Some possible questions to be addressed include:

Does CIRM plan to bring its staffing up to the limit of 50 over the next three years? If not, why not? (CIRM directors have repeatedly expressed concern about staff burnout and overwork. The agency has also has lost a substantial number of employees since its inception, including 25 percent in a two-month period last year.)

What is the anticipated impact of the Prop. 71 spending cap on operations over the next 10 years? Are there steps that need to be taken now to avoid a financial crunch later when less flexibility may exist?

Given the heavy reliance on outside contracting, are steps being taken to assure that the staff, which is trained mainly in scientific matters, performs well in selecting and monitoring contractors? What steps are being taken to assure that outside contractors do not have conflicts of interest that could motivate them improperly? Do the proposed $500 million biotech lending program and administration of the $1.1 billion lab construction effort pose special oversight issues?

What steps are being taken to avoid overruns linked to outside contracts, such as the apparent overrun on the grants management contract with Grantium of Ottowa, Canada. (Directors were assured last October that the complete cost of the three-year contract would be $757,000. Recently, CIRM posted an $85,000 RFP for a consultant to help with work on the program. We asked CIRM on May 15 about the need for the consultant. We have received no response to that question.)

Obviously other budget issues need to be addressed as well. But we would hope that Trounson and his tiny 26-person staff would begin to publicly address some of these issues soon.

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