Higher Ed Denounces GSA’s Proposed Federal Funding Strings

Vague. Undefined. Overbroad. Burdensome. Legally contested.

That’s how major higher ed groups are describing the Trump administration’s latest effort to crack down on what it considers diversity, equity and inclusion by requiring colleges and universities to sign a pledge that they will comply with “executive orders prohibiting unlawful discrimination on the basis of race or color” to receive federal funds. The proposed pledge warns that race-based scholarships, hiring preferences, diversity statements and more may constitute illegal discrimination, in the government’s opinion.

The General Services Administration’s proposed certification requirements would also ban aiding “illegal aliens” or facilitating “terrorism,” using wording that organizations say could restrict free speech and academic freedom. Universities found in violation of the new requirements could lose federal funding.

The public comment period on the proposal ended Monday after nearly 22,000 comments came in. One public comment—signed by the American Association of University Professors, the free expression group PEN America and many others—said it would require universities to “audit every activity and practice throughout their institution … require a surveillance-like campus culture at all higher learning institutions” and make them “align their practices with a specific ideology.”

Jon Fansmith, senior vice president for government relations at the American Council on Education, told Inside Higher Ed the administration knows its proposal goes well beyond the law.

“But they do it not because they expect it to survive a legal challenge—in lots of these cases, by the time the courts decide, they overturn their policies—but because they know in the interim it will scare institutions into proactively complying,” Fansmith said. “What they’re asking you to certify is that you are in compliance with their interpretation of a law, not with what the actual law says.”

The Association of American Universities, a prestigious group of leading U.S. research institutions, wrote in its public comment that “institutions are asked to certify they are not doing something without being told clearly what that something is.”

The AAU wrote that “research universities operate under hundreds or thousands of active federal grants and cooperative agreements at any given time,” including with major federal research funding institutions such as the National Institutes of Health. Fansmith said the proposal appears to affect universities that just accept federal student aid funding, including federal loans for students.

‘Meant to Intimidate’

The proposed requirements say institutions could be found liable under the False Claims Act for violating the proposed pledges, which could lead to significant penalties for universities that run afoul of the Trump administration’s changing interpretations of federal law. Fansmith said the FCA makes the signatory to the certification personally liable, adding, “It is very clearly meant to intimidate.”

The AAU warned that “if an institution certifies in good faith but is later found to have operated a program that the government considers a violation of the DEI certification, that certification could be deemed false and material to every federal payment made during the certification period. The FCA exposure in that scenario is not marginal or hypothetical; it is real and potentially existential.”

The FCA threat is just one of several concerns that higher ed associations raised in public comments on the proposal. For American Council on Education president Ted Mitchell, the plan is inherently flawed because it relies on the administration’s interpretation of what federal antidiscrimination law prohibits. That “goes well beyond settled law, requiring endorsement of legal interpretations that are the subject of current federal litigation and have not yet been resolved by the courts,” he wrote.

Mitchell wrote his comment on behalf of his university membership organization and 22 other higher ed groups, including the American Association of Community Colleges, the Association of Public and Land-grant Universities, the American Association of State Colleges and Universities, the National Association of Independent Colleges and Universities, the Association of Governing Boards of Universities and Colleges, and the American Council of Learned Societies.

Mitchell noted federal law isn’t the only law universities must follow. “From a legal standpoint as well as an operational reality, institutions or any other entities should not be required to provide an additional certification that they are in compliance with an interpretation of federal law [that] may, in fact, contradict state and local law,” he wrote.

A ‘Parallel’ Order

In addition to the proposed General Services Administration requirements, federal contractors have to grapple with a related executive order that President Trump issued Thursday. Fansmith called it a “parallel” effort that likely seeks to impact not just universities that make traditional contracts with the federal government, but also recipients of research funding grants.

Trump wrote in the order that “my Administration has made significant progress in ending racial discrimination in American society, including so-called ‘diversity, equity, and inclusion,’” but the work isn’t done. “Some entities continue to engage in DEI activities and often attempt to conceal their efforts to do so,” he wrote.

The order requires federal agencies to put into all “contracts and contract-like instruments, including contractors’ subcontracts and subcontractors’ lower-tier subcontracts,” a clause requiring the contractor to pledge not to “engage in any racially discriminatory DEI activities.” (Unlike some previous directives, Trump’s order does provide a definition of that phrase: “disparate treatment based on race or ethnicity” in recruiting, employment, contracting, resource allocation or “program participation,” which is further defined as participation in associations, educational opportunities or other opportunities the contractor or subcontractor sponsors.)

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Trump directed the White House Office of Management and Budget to issue guidance, based on his order, to federal agencies on canceling contracts and suspending or debarring contractors from receiving future federal funds for violations. The White House didn’t respond to Inside Higher Ed’s requests for comment on the order or forthcoming guidance, and the General Services Administration didn’t respond to requests for comment on its proposal.

On one hand, these are new moves by the Trump administration. But they’re also further attempts to continue an anti-DEI campaign that the president has been waging ever since he returned to office.

‘Non-Binding’ No More?

Since Trump was inaugurated the second time, groups representing higher ed institutions and their constituencies have criticized his crackdown on DEI as vague and overbroad. Organizations’ lawsuits have reversed or tied up in court many of the administration’s prior attempts to restrict a wide range of activities that take into account race or ethnicity, such as identity-based graduation ceremonies.

The General Services Administration, in a Jan. 28 post on the Federal Register announcing its proposed changes, said the new language would “align with updated executive branch guidance” including a Jan. 21, 2025, executive order that aimed to end “illegal DEI” and a July 29 Justice Department memo.

That memo suggested that even programs relying on what Attorney General Pam Bondi described as stand-ins for race, such as recruitment efforts focused on majority-minority areas, could violate civil rights laws in the current Justice Department’s eyes. It also said race-restricted scholarships, mentoring, leadership programs or facilities, such as a lounge or “safe space” designated for minority students, are illegal.

Although the General Services Administration’s proposed new requirements for federal funding recipients don’t outright say such practices would be considered violations, the draft says they “may” be. Specifically, it says, “race-based scholarships or programs, preferential hiring or promotion practices, or access to facilities or resources based on race or ethnicity, including through the use of ‘cultural competence’ requirements, ‘overcoming obstacles’ narratives, or ‘diversity statements,’” might be violations. Additionally, “race-based ‘diverse slate’ policies in hiring,” “race-based selection for contracts” and “training programs that stereotype, exclude, or single out individuals based on protected characteristics or create a hostile environment,” could violate the pledge.

But, as ACE’s Mitchell pointed out, Bondi’s memo isn’t a law passed by Congress—the memo calls its own contents “non-binding suggestions to assist entities in avoiding legal pitfalls.”

“Requiring recipients of federal funds to certify they are in compliance with recommended best practices included in DOJ and other sub-regulatory guidance effectively turns ‘non-binding suggestions’ into mandatory requirements,” he wrote, accusing the General Services Administration of “newly seeking to require that recipients of federal funds certify they are in compliance with legal interpretations of nondiscrimination laws that have been advanced through executive orders.”

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The AAU’s comment said the proposal asks “federal financial assistance recipients to certify compliance with a legal standard that federal courts have declined to uphold, that the government’s own litigators cannot clearly define, and that carries serious [False Claims Act] consequences that threaten the financial stability of the research enterprise.”

Beyond the DEI-related parts of the General Services Administration requirements, universities would also have to pledge to not knowingly bring or attempt to bring “an illegal alien” into the country, or “transport, conceal, harbor, shield, hire, or recruit [an illegal alien] for a fee” or “induce” them to “enter or reside in the United States with reckless disregard of” their lack of legal status.

AAU said this harbor or shield prohibition wording “is overbroad to the point of ensnaring entirely lawful educational activities.” It asked GSA to “either exclude educational institutions from the scope of this certification as applied to standard academic services” or confirm in guidance “that the provision, enrollment, and administration of educational programs does not constitute harboring or shielding.”

Universities would also have to agree not to “fund, subsidize, or facilitate violence, terrorism, or other illegal activities that threaten public safety or national security.” AAU wrote that the language “could be read to encompass a wide range of protected academic expression, including classroom instruction on terrorism and extremism, research on designated organizations, and campus speech and debate about contested geopolitical topics.”

Mike Gavin, president and chief executive officer of the Alliance for Higher Education, focused on the speech and academic freedom ramifications of the proposals in a public comment signed by the American Association of University Professors, the affiliated American Federation of Teachers union, PEN America, the National Association of Diversity Officers in Higher Education, the National Campus Jewish Alliance, the American Historical Association and more.

“Conditioning access to federal grants on broad certifications that reach into matters of curriculum, campus governance, student supports, speech, and protest activity will pressure institutions to align internal policies with ideology unrelated to the specific purposes of the funded programs,” Gavin wrote. “This is an unnecessary intrusion of politics into federal grantmaking.”