Arkansas Senator Tom Cotton is urging U.S. Secretary of Education Linda McMahon to increase federal scrutiny of financial relationships between American universities and Chinese entities, including organizations sanctioned by the United States.
Cotton sent McMahon a letter dated July 27, 2026, raising concerns that some financial transactions may not be disclosed under current federal reporting requirements.
The Arkansas Republican maintains that greater transparency is needed to protect American research, technological innovation and national security.
Cotton Cites More Than $6.8 Billion
Cotton’s letter cites data available through the U.S. Department of Education’s foreign-funding reporting portal.
According to figures presented by Cotton, federally funded American universities had accepted more than $6.8 billion from Chinese sources as of January 31, 2026.
Cotton said the amount included more than $300 million from entities sanctioned by the United States.
The senator also reported that Harvard University had received more than $630 million from Chinese entities.
Cotton’s letter said Harvard’s reported funding included approximately $418,000 from organizations participating in foreign talent programs and nearly $420,000 from entities allegedly connected to unauthorized military advancements.
The dollar amounts and descriptions are allegations and concerns presented in Cotton’s letter. The letter does not accuse the universities themselves of committing a crime.
Concern About Reporting Threshold
Section 117 of the Higher Education Act requires colleges and universities receiving federal financial assistance to disclose foreign gifts and contracts valued at $250,000 or more annually.
The threshold applies to transactions from the same foreign source when considered individually or together during a calendar year.
Transactions from a single source that remain below the $250,000 annual threshold generally do not trigger the reporting requirement.
Cotton expressed concern that millions of dollars in additional transactions involving sanctioned Chinese entities could remain undisclosed because they did not reach the reporting threshold.
The senator asked McMahon and the Department of Education to apply additional scrutiny to financial relationships between American universities and Chinese entities.
New Foreign-Funding Portal Launched
The Department of Education launched its updated Section 117 foreign-funding reporting portal on January 2, 2026.
The system allows universities to submit required reports and gives the public access to information about foreign gifts and contracts reported by federally funded institutions.
The department said the updated portal was designed to improve university compliance, public transparency and national-security oversight.
Under federal law, covered colleges and universities are required to file foreign-funding disclosure reports twice each year. Reports are generally due January 31 and July 31.
The department has warned that universities failing to provide complete and accurate reports could face federal enforcement action.
2025 Disclosures Totaled More Than $5.2 Billion
In a February 2026 report, the Department of Education said universities disclosed more than 8,300 foreign-funding transactions from 2025 with a combined value exceeding $5.2 billion.
Chinese sources accounted for more than $528 million of the foreign gifts and contracts reported for 2025, according to the department.
The department also reported that American universities have disclosed a total of $67.6 billion in foreign funding since Section 117 was added to the Higher Education Act in 1986.
The 2025 data identified Qatar, the United Kingdom, China, Switzerland, Japan, Germany and Saudi Arabia among the largest reported foreign-funding sources.
Harvard Among Universities Under Review
The Department of Education previously initiated Section 117 investigations or records requests involving Harvard University, the University of Pennsylvania, the University of Michigan and the University of California, Berkeley.
Those actions followed federal concerns about potentially inaccurate, incomplete or untimely foreign-funding disclosures.
The existence of an investigation or records request does not establish that a university violated federal law. It allows the department to examine records and determine whether an institution complied with its reporting obligations.
Cotton Requests Additional Scrutiny
Cotton commended the department for its efforts to strengthen transparency and enforce university reporting requirements.
However, he argued that the current disclosure threshold could prevent the government and public from seeing the full extent of certain financial relationships.
Cotton said additional federal review is needed to determine whether transactions involving sanctioned Chinese organizations remain unreported.
The Department of Education had not publicly announced a response to Cotton’s request at the time of publication.
SOURCES
Senator Tom Cotton’s July 27 letter and announcement
U.S. Department of Education foreign-funding portal announcement
U.S. Department of Education 2025 foreign-funding disclosures
Section 117 reporting guidance
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