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INTRODUCTION

Animal models maintained under carefully controlled conditions (including behavioral management) more reliably yield high-quality scientific data than animal models maintained otherwise. During the last several decades, the quality of animal-based research and the care that animals receive in research programs has improved significantly. The changes have been driven by scientific advances and increased professionalism in laboratory animal science. Those advances, as well as more rigorous federal regulatory requirements, have required substantial institutional investment in facility and equipment modernization, staff and research oversight, and regulatory functions. Public accountability and credibility of animal-based research have also improved especially since 1966 when the Laboratory Animal Welfare Act, Public Law 89-544, was passed. These scientific advances coupled with increasingly sophisticated demands of biomedical research have lead to the development of the modern animal research facility (ARF).

ARFs can be either dispersed throughout institutions or centralized within them; if centralized, they can be within or next to other laboratory research spaces or in separate locations that is easily accessible to investigators. In this report, centralized animal research facility (or centralized ARF) is taken to mean a facility where animal research laboratories and procedure rooms are clustered to permit the efficient delivery of high-quality research and care. Because investigators must see and interact with their animals often, commonly several times per day, it is undesirable to separate the ARF widely from other research space. Thus, there is a tradeoff between the benefits of centralization and investigator convenience.

In the 1970s, the National Institutes of Health (NIH) published the Cost Analysis and Rate Setting Manual for Animal Research Facilities (the CARS Manual), which provides guidance for determining the costs of ARFs and developing rates for charging users of the services of the facilities. Although it does not constitute a government regulation itself, the CARS Manual is considered an authoritative document; it is published under the auspices of NIH, and is intended to promote consistency in how ARF costs are handled and rates are developed by institutions around the country.

Because of increased sophistication of animal research, increased regulation of the care and use of laboratory animals, improved computer technology for cost accounting, and the need for consistency in costing and rate-setting in ARFs, the NIH National Center for Research Resources (NCRR) appointed a committee in 1995 to update and revise the CARS Manual. It cannot be finalized, however, until it is resolved whether facilities and administrative (F&A) costs associated with ARFs can be charged to the indirect cost pool, as is typically done for other research facilities, or must come from direct charges as part of the ARF per diem rates. The CARS committee originally recommended that direct costs of providing ARF services and internal support costs be included in the per diem charges while F&A costs including space, administration, and regulatory compliance costs should be included in the indirect cost pool. After discussion with OMB, who did not accept this interpretation, the CARS committee suggested a compromise: the F&A costs associated



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