The U.S. Department of Education’s Office of Federal Student Aid has placed Harvard University on heightened cash monitoring status due to growing concerns about the university’s financial position, according to a Friday announcement.
Harvard is the nation’s oldest and wealthiest institution, with over $53 billion in its endowment.
The announced status update comes after a federal judge sided with Harvard, restoring nearly $3 billion in federal funding to the university at the beginning of September. Since then, the federal government has begun reinstating some of the funding. The fight between Harvard and the Trump administration has been ongoing since February.
The federal government will require Harvard to post $36 million or other financial protection to the Department of Education as a guarantee to cover potential liabilities and to make sure the university meets its financial obligations, according to the Trump administration.
While students will have access to federal funding, the status means that Harvard has to use its own funds to disburse federal student aid before drawing funds from the federal government.
The university will also be required to cover “initial disbursements as a guardrail to ensure Harvard is spending taxpayer funds responsibly,” the federal department said.
“Today’s actions follow Harvard’s own admission that there are material concerns about its financial health. As a result, Harvard must now seek reimbursement after distributing federal student aid and post financial protection so that the Department can ensure taxpayer funds are not at risk,” said U.S. Secretary of Education Linda McMahon. “While Harvard remains eligible to participate in the federal student aid program for now, these actions are necessary to protect taxpayers.”
A Harvard spokesperson didn’t immediately respond to a request for comment.
A separate letter to Harvard was also sent on Friday, accusing the institution of refusing to provide documents and information on its admissions.
Read more: Trump admin threatens Harvard with new penalties in latest demand for documents
The actions criticizing Harvard’s financial stability are a result of three “triggering events,” the federal government said.
The first point of concern brought up was the Department of Health and Human Services determination that Harvard is in violation of Title VI of the Civil Rights Act. This risks the university’s access to all federal student aid funding due to its noncompliance, the federal government said.
The other points of concern were the layoffs at the institution, on top of university-wide hiring and salary freezes and Harvard selling $750 million in bonds in April.
“Taking on the additional debt may make it materially more difficult for Harvard to satisfy any liabilities with the Department in the event that it loses access to federal funding,” the Department of Education said.