A senior-level tenured neuroscientist at the Salk Institute for Biological Studies in La Jolla, Calif., is teetering on the edge of closing his lab after Salk administrators pulled hundreds of thousands of dollars in funding that was tied to a dwindling endowment.

Stephen Heinemann has seen tough financial times. As president of the Society for Neuroscience in 2005-06, he had a front-row seat in Washington to watch the NIH budget flatline. Expecting diminishing grant payments, he gradually shrunk his lab from a staff of more than 40 around a decade ago to a dozen or so researchers today.

Then the economy tanked, and in January Salk halted all funding stemming from the Salk Institute Council Endowment, which supported Heinemann's endowed chair position and a sizeable chunk of his research. Heinemann still held two grants from the NIH and received support from a private foundation. But with an active mouse research lab that cost north of half a million dollars each year, he couldn't make ends meet without the endowment that paid for 30-40% of his operating costs as well as his salary.

The Salk administrators audited Heinemann's books and told him he had to make cuts. He started using new cryogenics techniques to freeze mice and bring down his overhead costs, but it wasn't enough. He had to let some staff go. "Unfortunately, you can't freeze people," Heinemann told The Scientist.

In response, Heinemann laid off six of his remaining staff. A fired postdoc who asked to remain anonymous told The Scientist that the decision to pull the endowment funding came "all of a sudden, without prior discussion." After many years of working at the institute, this postdoc now only has funding until the end of the month.

"I don't know what's going to happen," said Heinemann, 70, who started up his lab at Salk almost four decades ago, but like all Salk professors works on year-to-year contracts funded through grant money alone. "I could easily be out the door." Now, Heinemann is trying to get his students and postdocs jobs elsewhere "before they fire me," he said. Without adequate funding to keep up an active research program, "people aren't going to stay in the lab because it's not a good place to be trained."

Heinemann was elected to the National Academy of Sciences in 1992, to the American Academy of Arts and Sciences in 1997, and to the Institute of Medicine in 2001. His work has been cited thousands of times, according to ISI. For example, his 1991 Science and 1994 Neuron papers on the structure of the glutamate receptor have been cited 497 and 286 times, respectively.

According to Heinemann, Salk administrators told him that under California law the institute could only pay him the interest on the endowment, and with the downturn in global markets they couldn't legally draw on the endowment's principal. But effective January 1st, 2009, California adopted the Uniform Prudent Management of Institutional Funds Act (UPMIFA), which does allow so-called "underwater" spending if such actions are deemed prudent by the board of the endowment, said Erik Dryburgh, an attorney who specializes in charitable giving at the San Francisco-based law firm Adler & Colvin.

Heinemann also argued that it's unfair to pull his funding considering that two institutional endowments stem from intellectual property that was developed in his lab, and which Salk sold to Merck over a decade ago. "My position is that I raised those endowments, both of them," he said. "As long as I have an active lab and if I'm still doing good enough science," Heinemann feels that the money should keep flowing.

Heinemann has appealed to William Brody, Salk's new president who took up the post on March 1, and Marsha Chandler, the executive vice president and chief operating officer, to draw on the endowment and continue to fund his lab. He's not overly optimistic, however. "I expect that I'll be fired," he said. "The question is just how quick. I just want to get my students out of here."

Salk officials declined to comment on the funding situation. "Drs. Brody and Chandler are not available for interviews for your story," Susan Trebach, a Salk spokesperson, told The Scientist. "The Heinemann financial situation is a personnel matter and they will not comment on it."

"Most [Salk] labs are funded based on their own capacity for generating money," Salk neuroscientist Fred Gage told The Scientist. "Sometimes, the individual chairs need to be evaluated on individual bases depending on where the money came from." The way that Salk administrators have dealt with the economic downturn has been "pretty transparent and open," said Gage. "Our institute is doing the best they can to cope with it."


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