"We're caught in a Catch-22," says Collier. "The government doesn't give you a strict definition of what's eligible [for indirect cost allocation]...then they come back and hit you in the stomach."

"The abuses have been greatly magnified out of proportion to their real nature," Collier said.

At the subcommittee, one investigator insists about the flak the universities have received, "It's not damage that has not been deserved."

And the government won't be downscaling its nationwide inquiry anytime soon.

"There's been a significant increase in interest," the investigator said. "And I think it's going to grow. It's not at the end yet. There's more questions being raised every day."

Under the microscope of the General Accounting Office, the University has admitted to making $500,00 of mistaken or questionable billings to the government for overhead on research at the Medical School. Now, the federal 'indirect cost' inquiry has engulfed nearly 300 schools.