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News

Unlisted Foreign Donations

Despite 1992 law, gifts to colleges are not on Education Department’s list

By Goldie Blumenstyk March 16, 1994

American colleges received millions of dollars in gifts from foreign companies, foundations, and nations in the last two years, but you wouldn’t know it from the reports on file with the U.S. Department of Education.

Not one of the untold number of donations that colleges have received from abroad since mid-1992 appears on the Education Department’s registry of foreign gifts.

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American colleges received millions of dollars in gifts from foreign companies, foundations, and nations in the last two years, but you wouldn’t know it from the reports on file with the U.S. Department of Education.

Not one of the untold number of donations that colleges have received from abroad since mid-1992 appears on the Education Department’s registry of foreign gifts.

Such disclosures, required as part of the 1992 Higher Education Act, were intended as a check on foreign influence in American higher education. Many colleges and universities that received gifts say they did not report them because they didn’t know about the law.

A few say they did report gifts from, and contracts with, foreign entities, as the law requires. They were a little piqued to learn that their reports had not shown up in the registry.

“I found that very upsetting,” said Terence E. Landers, director of gift accounting at Georgetown University.

Mr. Landers said he had called the Education Department more than a half-dozen times trying to learn how to comply with the law, and had received little help. “They just referred me back and forth,” he said. Finally, he sent his report to a department in the Office of Postsecondary Education.

Because it wasn’t sure if the law required disclosure of promised gifts as well as those in hand, Georgetown reported both.

“Maybe a lot of schools have complied. But heaven knows where their reports are,” Mr. Landers said.

Harvard and New York Universities also submitted gift reports to the Education Department, but their filings did not include pledges. (Officials at both institutions also acknowledged that they had inadvertently omitted some gifts that they had publicly reported elsewhere.)

Whether the Education Department, the colleges, or both are to blame, those who advocated the disclosure law are not happy that the department’s records list no gifts since 1992. The registry does list gifts from the late 1980’s, when a previous disclosure law was in effect.

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Among those who are displeased is the American Jewish Congress, which successfully lobbied Congress to reinstate the disclosure provision in the Higher Education Act when it was re-authorized by Congress in 1992.

“There are no new reports? That’s amazing,” said Will Maslow, general counsel for the American Jewish Congress. Mr. Maslow and others said the disclosure requirement was not controversial when it was proposed. He called its requirements “very modest.”

“Is it too much to ask them to enforce a law like this?” Mr. Maslow asked.

The member of Congress who sponsored the law, Rep. Nita M. Lowey, Democrat of New York, said the disclosure measure was meant to allow the public to “evaluate any kind of [foreign] influence on our system. It’s important because we want to know who’s contributing to the universities. This is serious, and we mean business.”

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The lack of compliance “is a concern,” said an Education Department spokeswoman. There are no penalties for failing to file reports, but the law says the government can sue colleges in federal court to force compliance.

Education Department officials speculated that some colleges might not have realized that the disclosure requirement is part of the Higher Education Act. At the same time, the officials acknowledged that the department had done little to make sure colleges know about it.

(In response to inquiries by the The Chronicle and Representative Lowey, the department said this month that it would write to all colleges to remind them of the law and advise them on how to comply with it.)

The department had no explanation for why the gifts that institutions did report do not appear on the disclosure reports it provided to The Chronicle in August 1993 and February 1994.

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A disclosure law was first in effect from 1987 to 1989, when it expired. The new disclosure provision, which requires colleges to report foreign gifts and contracts valued at $250,000 or more every January 31 and July 31, has no expiration date.

Both the earlier law and the current one were enacted in response to concerns that foreign governments or companies could use their gifts to influence research, dictate faculty appointments, or control curricula.

The American Jewish Congress, for example, began pushing for the law in the mid-1980’s in reaction to a controversy at Georgetown. It was rumored that a $642,000 gift in 1981 from the government of Libya for a professorship in Arabic studies carried a condition requiring the university to hire faculty members sympathetic to the Palestine Liberation Organization. Georgetown denied that was so and eventually returned the grant, saying it did not want money from a nation linked to terrorism. The American Jewish Congress’s Mr. Maslow said he believed the disclosure requirement had kept universities from accepting gifts with inappropriate strings attached.

Under the law, if gifts or contracts have restrictions or conditions, colleges must report them.

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Of the institutions that had failed to report their gifts, many said they simply didn’t know that they had to.

“It’s a sin of omission,” said Melvin Taylor, a spokesman for the University of San Francisco, which has received foreign gifts and pledges totaling $2.3-million since mid-1992, but did not report them.

Officials at Gallaudet and Ohio Universities also said they didn’t know about the law. Gallaudet said that it had satisfied the law because the Education Department knew about its foreign gift -- $1-million gift from the Sasakawa Foundation -- from other accounting records that the university routinely provides to the department.

Some officials of public colleges said they believed they were not required to file reports because gifts had come to their foundations, not directly to the institutions. A $21-million gift to the University of Arkansas from the Kingdom of Saudi Arabia, for example, came through the state’s Department of Higher Education. “I don’t believe that, technically, we have to report it,” said Fred Harrison, general counsel for the university system.

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Although the university did not report the gift -- intended for development of programs in Middle East affairs -- he said it would soon do so. “We’re proud of the program,” Mr. Harrison said.

Other gifts may escape official disclosure altogether. Arizona State University, for example, said it did not believe it was required to report a $500,000 gift from Taiwan for support of the Barry M. Goldwater Chair because the money went to a private trust that is separate from Arizona State, and later came to the university from the trust.

Lonnie L. Ostrom, president of Arizona State’s fund-raising foundation, said he would report gifts that came directly to the foundation. Mr. Ostrom said he saw nothing objectionable about the disclosure requirement, but questioned whether it was really necessary or relevant today.

“I doubt whether endowed centers are going to be easily dictated to,” he said.

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David Macmillan, director of development at the University of San Francisco, said his institution, while new to foreign fund raising, had “not seen any of the kind of strings-attached problem that this law seems to be aimed at.”

He said the university had little fear that foreign donors would seek such conditions. In fact the university will soon begin a campaign to raise between $75-million and $100-million, and, Mr. Macmillan said, “I’d be delighted if gifts from international sources amounted to 10 per cent of that.”

American U.: $500,000 from H.H. Shaikh Hamad bin Issa Alkhalifa, Crown Prince of the State of Bahrain, for an endowed professorship in the School of Business.

California State U. at San Bernardino: $925,000 from the Yasuda Institute of Japan for a classroom and conference building.

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Columbia U.: $1.5-million from Takeo Atsumi of Japan to establish a professorship in the history of Japanese art.

Gallaudet U.: $1-million from the Sasakawa Foundation of Japan for financial assistance to deaf international students enrolled in degree-granting programs.

Georgetown U.: $2-million from the Sasakawa Foundation for a professorship in Japanese language and culture.

Georgetown U.: $910,746 from the Federal Republic of Germany for a Center for German and European Studies.

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Georgetown U.: $2.9-million from the Foundation for Christian and Muslim Understanding, in Switzerland, for a Center for Muslim Christian Understanding.

Georgetown U.: $1-million from Hasib J. Sabbagh of Greece for the Muslim Christian center.

Georgetown U.: $2.6-million from Sultan Qaboss bin Said of Oman, for an undergraduate program in Arabic language and culture.

Georgetown U.: $1.35-million from the Dainong Group of South Korea, for a professorship in Korean Studies.

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Hartwick College: $2-million from Chaing Mai University in Thailand to establish an exchange program.

Harvard U.: $3.5-million from the Korea Foundation, a South Korean government organization, to establish a chair in Korean literature.

Harvard U.: $5-million from King Fahd of Saudi Arabia to the law school for Islamic legal studies.

Harvard U.: $20-million from Countess Albina du Boisrouvray of France for a professorship and for a center for health and human rights.

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Harvard U.: $2-million from Shoichi Okinaga, president of the Teikyo Group, an educational conglomerate in Japan, for a cooperative program between the School of Public Health and Teikyo University (Japan).

Harvard U.: $1.65-million from the government of Zambia (purpose undisclosed).

Harvard U.: $1.06-million from the government of Kenya (purpose undisclosed).

Harvard U.: $2.8-million from the government of Malawi (purpose undisclosed).

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Massachusetts Institute of Technology: $5-million from Tokyo Electric Power of Japan for an environmental-research program and a professorship.

New York U.: $250,000 from Vardis J. Vardinoyannis of Greece to establish a library of Hellenic civilization.

New York U.: $269,700 from Fujimoto Pharmaceutical Corporation of Japan for sponsored research at the medical center.

New York U.: several gifts totaling more than $689,000 from the Alexander S. Onassis Public Benefit Foundation in Greece for the Onassis Center for Hellenic Studies.

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Ohio U.: $500,000 from You-Bao Shao, of Hong Kong, to establish the Overseas Chinese Documentation and Research Center.

Ohio U.: $1-million from Sally Aw Sian, executive chairman and group managing director of Sing Taoi Ltd., a Hong Kong publishing company, for an endowed professorship in international journalism. Also, $150,000 for a building to house the center.

Rochester Institute of Technology: $1-million from the Sasakawa Foundation to the National Technical Institute for the Deaf to provide scholarships for deaf students from other countries, particularly developing countries.

U. of Arkansas: $21-million from the Kingdom of Saudi Arabia to establish a Middle East Studies Center.

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U. of Hawaii: $2-million from the Korea Foundation for Korean studies.

U. of San Francisco: $300,000 from China Times newspaper in Taiwan for scholarships, faculty development, and business programs that focus on the Pacific Rim.

Source: Chronicle Reporting

We welcome your thoughts and questions about this article. Please email the editors or submit a letter for publication.
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About the Author
Goldie Blumenstyk
The veteran reporter Goldie Blumenstyk writes a weekly newsletter, The Edge, about the people, ideas, and trends changing higher education. Find her on Twitter @GoldieStandard. She is also the author of the bestselling book American Higher Education in Crisis? What Everyone Needs to Know.
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