House committee advances bill requiring universities to report large foreign gifts, set waiver process

Lansing — The Michigan House Committee on Government Operations advanced House Bill 42‑39 on a voice and roll-call vote Thursday after adopting a substitute that narrows the federal reference to the U.S. Department of State and increases university‑board involvement.

The bill would require public colleges and universities to report gifts, contracts or agreements from foreign sources that meet or exceed a $50,000 threshold and to obtain a waiver before accepting funds or entering covered agreements with countries or entities designated by the bill as “countries of concern.” The substitute adopted in committee names the U.S. Department of State as the federal agency to be consulted for determinations and increases the role of state higher‑education governance in reviews.

Sponsor testimony framed the measure as a national‑security and risk‑management step for Michigan. Representative Brock, testifying for the bill, said the intent is “transparency plus accountability equals risk mitigation.” Brock told the committee federal investigations and reports have shown foreign money and partnerships have aided foreign military and technological advances and that the state needs “guardrails” for publicly funded institutions. He said the bill would require reports identifying donors, purpose of the gift and signatures on agreements. “I think transparency is a good thing,” Brock told the committee.

Public witnesses urged greater caution. Kyle Zawakin, legislative director for the American Civil Liberties Union of Michigan, said the bill uses “ambiguous language and undefined language,” particularly for terms such as “detrimental,” and warned it could “impose sweeping and vague restrictions that threaten academic freedom, cultural education” and civil liberties. Henry Duong, organizing director at Rising Voices, said the measure “dangerously conflate[s] the actions of foreign governments with the presence and contributions of international students, immigrant families, asylum seekers and refugees” and warned of chilling effects on international collaboration.

The bill sets a state reporting threshold at $50,000; witnesses and the sponsor contrasted that with a federal reporting threshold of $250,000. The sponsor told the committee the substitute would follow federal practice in naming countries or entities of concern and said universities would still be able to accept funds from designated countries if they obtain a waiver — which testimony said must be requested roughly 120 days before acceptance.

Sponsor testimony cited figures the bill’s backers have compiled: an estimated $6.5 billion in unreported foreign investment in U.S. universities over the past decade and about $2.3 billion from the People’s Republic of China in the same period. The sponsor also referenced a 2022 listing that placed the University of Michigan near the top of U.S. institutions receiving Chinese and Hong Kong funding; specific figures mentioned in testimony included $153 million for the University of Michigan and $396 million for Harvard University, as reported by an outside commission.

Committee members asked how the state’s process would interact with federal authorities. The sponsor said the substitute relies on determinations by the U.S. Department of State and that the department already maintains lists and thresholds for concerns, though the bill lowers the reporting threshold for Michigan institutions. The sponsor acknowledged the bill could create additional administrative work for universities and said the bill is intended to increase transparency for publicly funded institutions.

The committee adopted the H‑1 substitute and later voted to report the bill with recommendation as substituted to the next stage in the legislative process.

Votes at a glance — House Bill 42‑39 - Motion: Adopt H‑1 substitute clarifying federal agency as U.S. Department of State and increasing board involvement. Mover: Representative Vanderwall. Committee roll call outcome: 3 yeas, 0 nays, 1 pass; motion adopted. - Motion: Report HB 42‑39 with recommendation as substituted. Mover: Vice Chair Harris. Committee roll call outcome: 3 yeas, 0 nays, 2 pass; reported with recommendation as substituted.

What the bill would do - Require public institutions to report foreign gifts, contracts or agreements at or above $50,000 (cumulative reporting from the same giver is included). - Require a waiver process for agreements with countries or entities designated as countries of concern; the bill’s substitute specifies a role for the U.S. Department of State in those determinations. - Increase reporting and recordkeeping obligations for public universities and their governing boards.

Why it matters Backers say the bill aims to reduce the risk that foreign funding and partnerships could contribute to foreign adversaries’ technological and military advances. Opponents say the bill’s language could be overbroad, chill academic collaboration and have discriminatory effects on students and scholars.

The committee’s action does not adopt a final law; reporting the bill with recommendation moves it to the next committee or floor step for further consideration.