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After facing the most damaging findings of a federal research cost investigation that shook universities across the nation this year, Stanford University President Donald Kennedy stepped down this week -- just one week after announcing that Stanford would reorganize the way it accounts for its research spending costs. "It is very difficult, I have concluded, for a person identified with a problem to be the spokesperson for its solution," Kennedy said in a statement dated July 28. Kennedy also said that he and the university responded poorly to the early allegations of Stanford's spending improprieties. But he blamed the initial response on inadequate information about the depth of problems in the school's accounting department. "If you had perfect hindsight and if you had perfect information, you would handle any bad situation differently," said Kennedy, who also said he plans to return to teaching biology at the university. The government continues to investigate allegations by U.S. research contract negotiators and auditors that Stanford overbilled Washington as much as $200 million in the 1980s for overhead costs related to research. Overhead includes maintenance and library services, costs which are not associated with any one particular research grant. Stanford's financial woes prompted similar audits at institutions around the nation, including at the University. Last month, federal investigators completed their inquiry at the University, and announced they had found $402,000 in overbillings during 1987. The government has cut more than $18 million from Stanford's annual research budget of about $240 million. The 59-year-old Kennedy, who said he would step down in August 1992 after 12 years as president, was humiliated at a congressional hearing in March. The panel noted that Stanford billed the government for a cedar-lined closet and a shower curtain in his home and for Kennedy's laundry. "The sad truth was he had lost the confidence of just about every faculty member," said William Spicer, an engineering professor and critic of Kennedy. Kennedy joined the Stanford faculty in biological sciences in 1960 and later served as commissioner of the Food and Drug Administration for 21/2 years during the Carter administration. Stanford has been beset with other problems this year, including the resignation of a medical professor who said she had been sexually harassed for years and the firing of a computer-science lecturer who bragged about carrying drugs on campus. The Associated Press contributed to this story.

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