New House Bill Would Penalize Colleges That Fail to Report Foreign Funding

By GQ Pan
GQ Pan
GQ Pan
Reporter
July 2, 2021 Updated: July 2, 2021

Reps. Diana Harshbarger (R-Tenn.) and Fred Keller (R-Pa.) on Wednesday introduced legislation that would hold accountable colleges and universities that fail to accurately report their foreign donations to the federal government.

The Requiring Education Providers to Observe Requirements or Trigger Fines Act, or REPORT Fines Act, would establish a three-strike system of penalties ranging from a written warning to fines equivalent to the unreported foreign gift, and finally disqualification from federal research funding.

In addition, the proposed bill would establish accelerated penalties for failure to report funding from a foreign adversary, such as China, Iran, and Russia. It would also lower the reporting threshold to include foreign gifts and contracts valued at $50,000 or more.

The federal law, known as Section 117 of the Higher Education Act, currently requires institutions of higher education to report foreign gifts or contracts of $250,000 or more. During the Trump administration, under the leadership of Education Secretary Betsy DeVos, the Education Department found that American colleges and universities had failed to report at least $6.5 billion in such funds.

“Universities that recklessly and habitually fail to report their foreign funding should not have their research funded by the federal government,” Harshbarger said in a June 30 press release. “This commonsense measure will both compel universities to comply with the law and prevent intellectual property developed with taxpayer dollars from falling into the hands of our adversaries, such as the People’s Republic of China. We know the Chinese Communist Party is engaged in a robust campaign to steal American technology to further their global ambitions, so this legislation is more important now than ever.”

The REPORT Fines Act marks the latest effort by House Republicans to address the issue of foreign economic influence on American campuses. Last month, Reps. Virginia Foxx (R-N.C.) and Jim Banks (R-Ind.) pressed Education Secretary Miguel Cardona on the matter, saying they are concerned that the Biden administration is not taking it seriously.

“The previous administration modernized the reporting process and found over $6.5 billion in unreported gifts and contracts and opened 19 university investigations,” the Republicans said in a letter to Cardona. “However, the Department has closed only four of those investigations to date. Moreover, you have not started or provided status updates on any other investigations into foreign gifts or contracts.”

Specifically, the Republicans asked whether the Education Department has opened any new college investigations or issued any related subpoenas, or if it intends on completing the remaining 15 investigations initiated by the Trump administration. They also asked the department what the total amount of reported foreign gifts was through the reporting period ending in January, how many full-time staff members are working on Section 117 assessment, and what range of corrective measures it would use to force non-compliant schools to disclose foreign money.

GQ Pan
GQ Pan
Reporter