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A week after the Department of Education launched investigations into foreign funding at Harvard and Yale, experts say federal authorities have long declined to provide clear guidelines for how universities should report such gifts.
The department announced the probe last week in a letter to University President Lawrence S. Bacow. The missive outlined the Department’s intention to enforce Section 117 of the Higher Education Act, which mandates that universities disclose all gifts or contracts over $250,000 from foreign entities.
Tobin Smith, the vice president for policy at the Association of American Universities, said universities’ foreign funding has piqued federal authorities’ interest following a February 2019 congressional hearing on China’s impact on the United States education system. Harvard is one of eight institutions that the Department of Education has begun investigating for compliance over the last year.
“There was some pressure about what the department was doing to enforce these things,” Smith said.
Terry W. Hartle, the senior vice president for government and public affairs at the American Council on Education, credited the recent uptick in investigations to broader changes in national security considerations.
“The view of ties between American academic and scientific institutions and foreign individuals and corporations has changed as a result of the increased emphasis on national security and preventing international espionage,” Hartle said.
Hartle said that though Section 117 has been on the books since 1986, federal authorities have seldom enforced it.
“After Congress enacted the legislation, no one paid much attention to it. Too many colleges and universities simply lost sight of it,” Hartle said. “As a result, compliance has not been as good as it should have been.”
“I have never known the Department of Education to open an investigation into the school over the failure to properly report,” he added.
Hartle and Smith also said that, in addition to a lack of enforcement, insufficient formal guidelines regarding how to report gifts and contracts from foreign entities have fazed colleges and universities for decades.
The Education Department has twice issued informal guidelines — in 1996 and 2004 — but experts say schools face gray-area dilemmas.
Both Hartle and Smith offered the example of a $1 million grant from a foreign government meted out five years, at $200,000 a year.
“Does that meet the $250,000 threshold? Because if you space it out over five years, it's $200,000,” Smith said. “Those are questions that we've tried to get answers from at the Department of Education, and nobody will respond to an institution that asked that question.”
Hartle also said the Department has not responded to questions over whether or not universities may aggregate funding data by country, rather than listing individual gifts.
“Harvard lists [gifts] by country where they originate. Other schools do the same thing — not Harvard by itself, other schools do it the same way,” he said. “Last January, we asked the DOE in a letter if this was permissible. The department never responded to our letter. Instead, in February 2020, they launched an investigation into Harvard.”
University spokesperson Jason A. Newton declined to provide additional comment on the investigation or how it reports gifts. Harvard has previously confirmed that it received the Department of Education’s letter and is preparing a response.
A Department of Education spokesperson wrote in an emailed statement that the department does not believe Section 117 reporting is too complicated, calling it “a very basic regulatory system.”
The Feb. 11 letter told Harvard it had 60 days to disclose all information regarding contracts and gifts from the governments and citizens of China, Iran, Qatar, Russia, and Saudi Arabia, in addition to a number individually specified foundations and universities abroad.
Brian Flahaven — the senior director for advocacy at the Council for Advancement and Support of Education — said that despite increased scrutiny, he thinks the Department is unlikely to pursue civil or criminal action if Harvard does not reply within the 60-day window.
“My sense would be that that wouldn’t be an avenue that would be pursued,” Flahaven said.
— Staff writer Ellen M. Burstein can be reached at ellen.burstein@thecrimson.com. Follow her on Twitter @ellenburstein.
—Staff writer Camille G. Caldera can be reached at camille.caldera@thecrimson.com. Follow her on Twitter @camille_caldera.
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