The Growing Tide of Foreign Funding in US Higher Education

American universities have long benefited from international partnerships and donations, which fuel groundbreaking research, expand global programs, and attract top talent. However, in recent years, the scale and sources of this foreign funding have sparked intense debate within the higher education community. With billions pouring in annually from nations across the globe, questions about transparency, influence, and potential national security implications have moved to the forefront. The White House and federal agencies have amplified calls for stricter oversight, highlighting risks that could undermine academic integrity and US interests.

This influx supports everything from STEM laboratories to cultural exchange initiatives, but the opacity surrounding some contributions has led to heightened scrutiny. Institutions must navigate a delicate balance: leveraging these resources for advancement while ensuring they align with American values and security priorities.

Understanding Section 117: The Backbone of Disclosure Requirements

At the heart of this discussion is Section 117 of the Higher Education Act of 1965, as amended. This provision mandates that colleges and universities participating in federal student aid programs report any foreign gifts or contracts valued at $250,000 or more. Reports are submitted biannually—by January 31 or July 31, depending on the transaction date—and must detail the source, amount, and purpose of the funds.

Enacted amid Cold War-era concerns about foreign influence, Section 117 aimed to promote transparency in an era when international academic ties were expanding. Over time, compliance has varied, with some institutions discovering previously unreported sums only after federal prodding. The law does not prohibit foreign funding but ensures public accountability, allowing stakeholders to assess potential influences on campus activities, curricula, or research directions.

Step-by-step, the reporting process involves identifying qualifying transactions, aggregating them by foreign source, and submitting via the Department of Education's portal. Non-compliance can result in investigations, fines, or risks to federal aid eligibility, underscoring the stakes for higher education leaders.

2025 Disclosures: A Record-Breaking Year

The most recent data from 2025 paints a stark picture of foreign funding's magnitude. US colleges and universities reported over 8,300 transactions totaling more than $5.2 billion in gifts and contracts. This figure contributes to a cumulative total of $67.6 billion since tracking began in 1986, with the bulk disclosed post-2019 amid renewed enforcement.

More than $2 billion of the 2025 amount was submitted late, violating statutory timelines and prompting federal concerns about systemic underreporting. These numbers reflect not just philanthropic support but also strategic investments by foreign entities in American innovation hubs.

• Breakdown by donor nations highlights diverse origins, from allies to adversaries.
• Tech-focused institutions dominate recipients, raising questions about dual-use research.
• Late filings signal compliance challenges amid growing volumes.

Qatar Emerges as the Dominant Foreign Donor

Qatar stands out as the leading source, contributing over $1.1 billion in 2025 alone and approximately $7.7 billion cumulatively. Much of this supports branch campuses in Education City, Doha, hosting programs from Cornell, Georgetown, and Northwestern, among others.

While these partnerships advance knowledge exchange, critics point to Qatar's geopolitical stance—including hosting Hamas leaders—as a potential vector for undue influence. Cornell received $2.3 billion overall, the highest from Qatar, fueling medical and engineering initiatives. Texas A&M shuttered its Qatar campus in 2024 amid political pressures, illustrating evolving risk assessments.

Proponents argue these funds enable global outreach without strings attached, but enhanced monitoring is urged to verify independence.

China's Contributions and Associated Scrutiny

China ranks third in 2025 with over $528 million, part of a $6.4 billion total. Funding often targets STEM fields, supporting collaborative research in AI, biotechnology, and quantum computing. However, cases of intellectual property theft and talent recruitment programs like the Thousand Talents Plan have fueled alarms.

Examples include unreported contracts leading to technology transfers benefiting Chinese military advancements. Federal guidance now requires disclosures of such ties, with bipartisan support for safeguards. Universities must vet partnerships rigorously, disclosing ownership or control by foreign entities.

Despite a mysterious drop in reported Chinese spending to $528 million in 2025, suspicions of underreporting persist, prompting congressional hearings on malign influence.

Leading Recipients and Their Dependencies

Elite institutions top the recipient list. Carnegie Mellon University and MIT each neared $1 billion in 2025, followed by Stanford ($775 million) and Harvard ($324 million). Cumulatively, Harvard leads from 'countries of concern' with $610 million, trailed by MIT ($490 million), NYU ($462 million), Stanford ($418 million), and Yale ($400 million).

These funds bankroll facilities, endowments, and scholarships, but reliance raises diversification concerns. Georgetown and Texas A&M received hundreds of millions from Qatar, supporting international affairs programs.

Federal Response: Executive Actions and Investigations

The Trump administration has prioritized enforcement. On April 23, 2025, President Trump issued Executive Order "Transparency Regarding Foreign Influence at American Universities," mandating full disclosures and reversing prior laxity. A new portal launched January 2, 2026, with upgrades adding data visualization.Explore the Foreign Funding Dashboard here.

Since January 2025, investigations targeted Harvard, UPenn, UC Berkeley, and University of Michigan for inaccuracies. Partnerships with the State Department enhance oversight. Threats of federal funding cuts loom for non-compliance. For details, see the White House Executive Order.

National Security Risks: Beyond the Numbers

Foreign funding poses multifaceted threats. Adversarial access to sensitive research enables espionage, as seen in Chinese cases diverting US taxpayer-funded innovations. Influence operations may skew curricula or campus discourse, exemplified by Qatar-linked antisemitism spikes on funded campuses.

Real-world cases include unreported gifts leading to fines and IP losses. Policymakers warn of 'invisible networks' compromising economic edges in AI and biotech. Step-by-step risks: funding → partnerships → data sharing → exploitation.

Solutions include vetting protocols, domestic alternatives, and congressional bills for stricter thresholds.

University Perspectives and Adaptation Strategies

Higher ed leaders emphasize benefits outweigh risks when managed properly. Many have bolstered compliance teams, conducting internal audits. Cornell defends Qatar ties as academically fruitful, while Texas A&M's exit shows recalibration.

Stakeholders advocate contextual reporting to avoid politicization, per Inside Higher Ed analysis. Proactive measures: diversified funding, transparency pledges, and ethics training.

Implications for Students, Faculty, and Careers

For students, foreign funds mean scholarships and global opportunities but potential biases in programs. Faculty navigate disclosure in grants, impacting collaborations. Administrators face compliance burdens amid budget pressures.

Actionable insights: Review funding sources, prioritize ethics, explore domestic grants. This scrutiny fosters healthier ecosystems.

Looking Ahead: Regulations and Reforms

2026 promises tighter rules, including State Department collaborations and possible legislation lowering thresholds. Bipartisan consensus eyes safeguards without stifling exchange. Universities preparing diversified portfolios will thrive, positioning US higher ed as secure innovation leaders.

Stakeholder dialogues emphasize balanced approaches: transparency yes, bans no. Future outlook: refined reporting, AI monitoring, and resilient partnerships.

Photo by Trnava University on Unsplash