DETERRENT Act Passes House

The confluence of increased bipartisan attention on foreign influence on college campuses, a lack of appropriations bills to debate, and the delay in negotiations on the National Defense Authorization Act (NDAA), gave the House free floor time to bring up the DETERRENT Act for consideration as a standalone bill this week. The bill passed with a bipartisan vote of 246-170, despite the higher education community’s opposition.

The bill drastically reduces the threshold for institutions to report on foreign gifts and contracts, from $250,000 to $50,000. The bill also reduces the reporting threshold to $0 for gifts from or contracts with China, Iran, North Korea, and Russia, which are considered “countries of concern.” The bill also requires institutions with $50 million in research and development or Title VI International Education programs to maintain a database of foreign gifts to faculty and staff of $480 or more or contracts of $5,000 or more. Private colleges with endowments of $6 billion or more are required to disclose foreign investments. And finally, the bill includes a complicated mechanism for enforcement of Section 117 that includes fines, investigations, and possible loss of Title IV federal student aid.

During debate on the bill, Rep. Michelle Steel (R-CA), the bill’s sponsor, said “As our college campuses are subjected to the rampant spread of antisemitism and the continued presence of CCP influence campaigns, it is critical that we expose the forces attempting to influence our children. When foreign governments give money to our universities, they don’t do it out of the goodness of their hearts; they want something in return.”

NAICU supported a substitute amendment offered by Education and the Workforce Committee Ranking Member Bobby Scott (D-VA), which was previously negotiated as a bipartisan compromise during consideration of the COMPETES Act in 2021. The Scott amendment was rejected but reflects a reasonable alternative. The Scott amendment would:

• Change the reporting threshold to $100,000 in one year or $250,000 over three years.
• Not include separate reporting thresholds for countries of concern.
• Reduce duplicate reporting burden by allowing institutions that report the same elements to their state or other federal agency to submit that report to the Department of Education.
• Require negotiated rulemaking with stakeholders.

The Scott amendment does not include the prohibition on contracts with countries of concern, the institutionally maintained database on foreign gifts and contracts to research faculty and staff, the private institution requirement for disclosing endowment investments of concern, or the strict enforcement mechanisms included in the underlying bill.

During debate, seven amendments were considered, including the Scott substitute, five of which were adopted:

Failed 94-320 – Offered by Rep. Andy Ogles (R-TN), the amendment would reduce the threshold value at which gifts must be reported from $50,000 to $1.

Agreed by voice vote – Offered by Scott Perry (R-PA) and Rep. Ogles (R-TN), the amendment adds international organizations to the definition of foreign sources for the purposes of Section 117, Disclosures of Foreign Gifts.

Agreed by voice vote – Offered by Rep. Pat Fallon (R-TX), the amendment increases the time institutions must maintain contract records from 4 years to 5 years.

Agreed by voice vote – Offered by Rep, Fallon (R-TX), the amendment prohibits institutions that commit three violations under this Act from obtaining a waiver or a renewal of a waiver.

Failed 202-213 – Offered by Rep. Scott (D-VA), the amendment would strike and replace bill language with a Democratic Amendment in the Nature of a Substitute.

Passed 372-39 – Offered by Rep, Marc Molinaro (R-NY), the amendment includes a requirement that foreign entities disclose any ties to designated foreign terrorist organizations, which includes Hamas.

Agreed by voice vote – Offered by Rep. Mike Carey (R-OH), the amendment revises the public, searchable database under Sec. 117b (2) to remove the personally identifiable information of staff or faculty required to disclose gifts and contracts in the bill; requires universities to include in the database the department, school, or college of the institution for the individual who is disclosing; and allows the names of the individuals making disclosures to be requested under the Freedom of Information Act.

The DETERRENT Act has been introduced in the Seante by Sen. Thom Tillis (R-NC). When negotiations on NDAA continue, the bill could be included in the broader defense vehicle for final passage.

For more information, please contact:
Stephanie Giesecke