Prof-like Substance has posted a nice summary of the NSF's funding stats for 2008. In it he writes:
"One thing that I found very surprising was the number of grants per PI. In the fiscal years 2006-08, 83% of PIs had one grant! That left 13% with two grants, 3% with three and 1% with four or more. As someone who has three very different projects that they are trying to get funded and has been talking with a colleague about a fourth, I'm not sure what to make of those numbers. If nothing else, it concerns me that reviewers might balk at a proposal just based on the number of grants held by a PI. Now, I'm not thinking that everything I am submitting will eventually get funded in the next year, but if these projects weren't fundable in my opinion, I wouldn't be wasting my time. Perhaps people who have served on a couple of panels (*cough* Odyssey? *cough*) might shed some light on the perception of when someone has "too much" funding."
I was going to reply in the comments but quickly realized this warranted a post all of it's own. Note that this is all based on my own observations and a few pieces of anecdotal evidence. As far as I know the NSF does not have any written policies regarding this stuff.
There are two issues here: holding more than one NSF grant concurrently, and what amounts to "too much" funding.
Firstly, let me address the comment "...reviewers might balk at a proposal just based on the number of grants held by a PI." Based on my experience on a couple of panels, that's rarely the case. A panel member might point out that someone is well-funded, but it doesn't seem to effect the review or panel scores. I believe it's the Program Directors who take current funding levels into account when making decisions as to who to fund.
As far as holding two NSF grants concurrently goes, the NSF stats reflect what I have observed over time. I have rarely come across someone who is PI on more than one NSF research grant. In fact I can only think of two instances. I do know of people who are PI on an NSF research grant and on a second, or even third, other type of NSF grant (e.g. REU site, equipment grant etc.). I would be one of those. So it happens, but it's rare. What's a PI to do? Call your Program Director and talk to them. Feel them out about the possibility of getting two NSF grants funded. One thing I do know however, submitting two proposals at the same time to the same panel is not received terribly well by the panelists. Or Program Director. Spread out your submissions.
So what has led to 83% of NSF-funded PI's holding just the one NSF grant? I have come to believe it's a function of the NSF's working philosophy. The Program Directors appear to view each grant funded as an investment. They want to "buy low", maintain the investment over the long term, and reap large returns. A well-established, well-funded investigator might be a "safe" investment, but often does not (appear to) give the same return per dollar over the long term as a riskier, young investigator.* What does that mean in practice? A senior person with one or more NIH R01's and no track record of recent NSF funding is unlikely to land an NSF grant. A young investigator with little or no other funding is in the running. Someone who landed an NSF grant early on, and subsequently pulled in other major funding while maintaining the NSF grant, remains in the running (the Program Directors want to hold their investments long term - as long as they continue to perform well on average).
I don't know whether this is fair or not. I have certainly benefited from this system. Keep in mind that the NSF's budget is a small fraction of the NIH's, and that they fund all non-biomedical science, plus math and engineering. Giving out multiple NSF grants to one investigator, or one to someone who is otherwise well-funded, means someone deserving misses out.** On the other hand, a single NSF grant is rarely enough to run a truly productive group...
Once again, the above are conjecture based on my own observations, nothing more.
* I would dearly love to see a study done on productivity/dollar. Many people, including myself, complain that investigators holding four or more R01's are not as productive per dollar as those with just one or two, but it's all based on anecdotal evidence on non-rigorous analysis of one or two mega-funded investigators.
** A Program Director recently told me the BIO Directorate at the NSF currently has a funding rate of ~15%. Better than NIH at the moment, but still lousy. A lot of really good grants are going unfunded.