Sunday, May 29, 2016

The Unique Six Percent Cinch on California's $3 Billion Stem Cell Research Effort

A look at CIRM's calculations on the life left in its operational budget.
Six percent budget cap
Restrictions courtesy of Prop. 71
Hearing on June 7

California's $3 billion stem cell agency may be the only state department that has a rigid legal cap on the total it can spend on operational expenses -- such things as employee salaries, office space, computers, meetings and much more.

When that money -- $180 million -- runs out, that's it, as far as the state goes. That is, unless the agency can wheedle more from lawmakers and the governor, which is an unlikely prospect at this time, given competing priorities for state spending.

The agency -- formally known as the California Institute for Regenerative Medicine or CIRM, -- has run through $105 million for administrative/operational expenses over its 11-year life. CIRM has about $75 million left and currently is burning up $15 million to $16 million annually.

The cap -- 6 percent of its $3 billion in bond funding -- was imposed by Proposition 71, the ballot initiative that created the agency in November 2004. From the very beginning, some members of the governing board questioned the cap, saying it was too chintzy for a research effort with such high aspirations.

Nonetheless, the cap is politically impossible to change at this point. It would require a super, super majority vote by the legislature or another vote of the people of California. Such an effort might result in efforts to bring the agency under legislative control. Currently, the governor and legislature have no legal say on how CIRM spends its money or how its awards are made, another feature of Prop. 71.

So parsimony has been a watch word at the agency, which, on June 7, will take up its budget for the fiscal year that begins in July. The CIRM board's Finance Subcommittee has scheduled a 90-minute session at its Oakland headquarters to consider the proposal. Following approval or any modifications, it is expected to be routinely ratified at a full board meeting in June.

The proposed budget is yet to be posted on the CIRM Web site and probably will not be available until later this week. The California Stem Cell Report will carry details on the plan when it becomes available.

The meeting has a teleconference location in Irvine where the public can participate in the discussion. Listen-only access is available via the Internet or through an 800 number. Details can or will be found on the agenda.

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