After $400 million in grants were canceled, Columbia taps endowment reserves to support its research programs

Columbia University has drawn on its unrestricted endowment funds to keep its research programs running after months of disruption in federal support, according to a report by The Columbia Spectator.In a statement issued on October 23, Anne Sullivan, Columbia’s executive vice president for finance, confirmed that the university had begun using unrestricted portions of its endowment during fiscal year 2025 and would continue doing so into fiscal year 2026. While the university did not specify the amount withdrawn, the decision marks a rare financial step for the Ivy League institution.

Federal grant freeze triggered the move

The unusual measure followed a series of funding shocks earlier this year. As reported by The Columbia Spectator, the federal government canceled about $400 million in research grants and contracts to Columbia in March, later halting all National Institutes of Health (NIH) awards in April.In July, the university reached a $221 million settlement with the administration of President Donald Trump, which led to the restoration of nearly all the frozen grants. Acting University President Claire Shipman told the University Senate in early October that “almost 99 percent” of the canceled research grants had been reinstated since the settlement.

Stabilisation funds for researchers

To help researchers weather the funding gap, Columbia announced in May the creation of two research stabilization funds—one established with support from NewYork-Presbyterian Hospital for the Vagelos College of Physicians and Surgeons, and another to assist projects across the wider university.

Together, the funds distributed more than 500 small grants of up to $100,000 in two rounds—first in June, and again in September, shortly after the federal settlement. Shipman wrote at the time that the grants were intended as a temporary bridge, giving research teams room to complete projects, pursue alternative funding, or pivot to new lines of inquiry.According to Sullivan, the funding pool came from a modest draw on centrally managed unrestricted endowment resources and a reduction in endowment-dependent central administrative spending.

A rare financial step

Although Columbia has faced financial strain before, dipping into its unrestricted endowment is considered a last-resort measure. Sullivan described the move as “a rare and multi-faceted decision” that carries long-term implications for the university’s financial sustainability.Typically, Columbia’s spending from its $15.9 billion endowment follows a formulaic approach—around 4.5 percent of the fund’s market value each year, adjusted for inflation.

For fiscal year 2025, the payout rose slightly to 4.9 percent.In addition to that annual distribution, the university’s trustees continued a supplemental payout first introduced during the 2008 financial crisis, when Columbia temporarily boosted spending to maintain financial aid and operations. The additional payout for 2025 was 0.55 percent and will remain in place for 2026, along with a new limited-term payout of 0.5 percent approved to support the university’s stabilization efforts.

Managing risk and long-term sustainability

Higher education finance experts say Columbia’s move reflects a broader trend among major universities balancing financial prudence with operational needs. “Institutions are trying to mitigate risk wherever they can,” said Chuck Ambrose, a senior education consultant at Husch Blackwell, in comments to The Columbia Spectator. “They’re using asset management to underwrite operating challenges while maintaining long-term discipline.”Columbia’s endowment consists of roughly 6,700 individual funds, most of them restricted by donor intent. About $10.9 billion, or two-thirds of the total, carries donor limitations, while the remaining $5 billion is classified as board-designated and can be used more flexibly.Even for unrestricted funds, Columbia has reiterated its commitment to long-term financial stewardship. “Endowments represent a promise by the University to sustain resources over time,” the institution states on its website. “Columbia has an obligation to future students and faculty to grow and preserve its endowment to maintain the university’s excellence.”