,,ii  #aaith ,,congress  #ast ,session  
,s4 #afhd  ,,in ,,the ,,senate ,,of     
,,the ,,united ,,states  ,may #h1       
#bjbe,mr4 ,cruz introduced the following
 bill2 which was read twice and referred
 to the ,committee on ,finance  ,a      
,,bill  ,to require audits of           
institutions with respect to disclosures
 of foreign gifts1 and for other        
purposes4  #a4 ,audits of institutions  
with respect to disclosures of foreign  
gifts ,section #aag of the ,higher      
,education ,act of #aife 7#bj ,u4,s4,c4 
#ajaa;f7 is amended-- 7#a7 by           
redesignating subsections 7g7 and 7h7 as
 subsections 7h7 and 7i71 respectively2 
and  7#b7 by inserting after subsection 
7f7 the following3  7g7 ,audit  7#a7 ,in
 general ,beginning not later than #fj  
days after the date of enactment of this
 subsection1 and every #b years         
thereafter1 the ,secretary shall conduct
 an audit of no fewer than #cj          
institutions to assess compliance with  
the reporting requirements under this   

section4  7#b7 ,determination of        
institutions to audit ,in determining   
which institutions to audit under this  
subsection1 the ,secretary shall        
prioritize audits for institutions that 
meet #a or more of the following        
criteria3 7,a7 ,institutions that are in
 the top #a percent when the endowments 
of all institutions are ranked from     
largest to smallest4  7,b7 ,institutions
 with a previous history of receiving a 
substantial gift from1 or entering into 
a substantial contract with1 a foreign  
source4  7,c7 ,institutions that have   
previously been noncompliant with the   
requirements of this section4  7,d7     
,institutions that publicly report      
receiving contributions from a foreign  
entity of concern 7as defined in section
 #ajfab7;a7 of the ,research and        
,development1 ,competition1 and         
,innovation ,act 7#db ,u4,s4,c4         
#aibba7;a7774  7,e7 ,institutions that  
have a formal agreement1 including a    
memorandum of understanding1 with a     

,federal agency4  7#c7 ,contents of     
audit ,as part of each audit conducted  
under this subsection1 the ,secretary   
shall determine-- 7,a7 if the           
institution was in compliance with      
requirements of this section for the #b 
reporting years prior to the year in    
which the audit is conducted2 and  7,b7 
in the case of noncompliance1 the gifts 
from1 or contracts with1 foreign sources
 whose amounts the institution under    
reported or over reported in the prior  
#b reporting years1 along with the      
following information for each of these 
gifts or contracts3 7i7 ,the amount     
under reported or over reported4  7ii7  
,the foreign source4  7iii7 ,the country
 of origin4  7iv7 ,the receipt date or  
contract start and end dates4  7#d7     
,report ,not later than #cj days after  
the date on which the audit under this  
subsection is completed1 the ,secretary 
shall-- 7,a7 submit to ,congress a      
report on the results of the audit2 and 
7,b7 make the report described in       

subparagraph 7,a7-- 7i7 available to the
 ,speaker of the ,house1 the majority   
and minority leaders of the ,house of   
,representatives1 the majority and      
minority leaders of the ,senate1 the    
,chair and ,ranking ,member of the      
committee and each subcommittee of      
jurisdiction in the ,house of           
,representatives and the ,senate1 and   
any other ,member of ,congress who      
requests the report2 and  7ii7 publicly 
available on the ,department of         
,education website4  4  #b4 ,excise     
taxes on certain contributions by       
foreign entities  7a7 ,in general       
,subchapter ,h of chapter #db of the    
,internal ,revenue ,code of #aihf is    
amended by adding at the end the        
following new sections3  #difi4 ,excise 
tax on contributions to colleges and    
universities by foreign countries of    
concern  7a7 ,tax imposed ,there is     
hereby imposed on each applicable       
institution for the taxable year a tax  
equal to #cjj percent of the income of  

such institution received from any      
foreign country of concern during the   
taxable year4  7b7 ,applicable          
institution ,for purposes of this       
section1 the term applicable institution
 means an eligible educational          
institution 7as defined in section      
#be;,a7f77#b77-- 7#a7 which had at least
 #ejj tuition-paying students during the
 preceding taxable year1 and  7#b7 more 
than #ej percent of the tuition-paying  
students of which are located in the    
,united ,states1  determined according  
to the rules of section #difh7;b77#b74  
7c7 ,foreign country of concern ,for    
purposes of this section1 the term      
foreign country of concern has the      
meaning given such term by section      
#ajfab7;a7 of the ,research and         
,development1 ,competition1 and         
,innovation ,act4  7d7 ,related         
organizations ,rules similar to the     
rules of section #difh7;d7 shall apply  
in determining income of an applicable  
institution for purposes of this        

section4  #digj4 ,excise tax on failure 
to report contributions by foreign      
entities  7a7 ,tax imposed ,there is    
hereby imposed on each institution for  
the taxable year a tax equal to #aaj    
percent of the unreported foreign       
funding received by such institution    
during the taxable year4  7b7           
,unreported foreign funding ,for        
purposes of this section1 the term      
unreported foreign funding means an     
amount equal to the value of any gift or
 contract1 or any amount received       
pursuant to a change in ownership or    
control1 required to be reported under  
section #aag of the ,higher ,education  
,act of #aife which is determined not to
 have been so reported by an audit under
 subsection 7g7 of such section4  7c7   
,timing of tax ,the tax imposed by      
subsection 7a7 shall be due not later   
than #ahj days after the institution is 
notified of the results of the audit    
under section #aag7;g7 of the ,higher   
,education ,act of #aife4  7d7          

,coordination with section #difi ,in the
 case of any unreported foreign funding 
which is received from a foreign country
 of concern 7as defined in section      
#difi7;c771 the tax imposed by          
subsection 7a7 shall be in addition to  
any tax imposed by section #difi on such
 funding4  7e7 ,institution2 other terms
 ,for purposes of this section1 the term
 institution1 and any other term used in
 this section which is used in section  
#aag of the ,higher ,education ,act of  
#aife1 has the same meaning as when used
 in such section4  4  7b7 ,clerical     
amendments  7#a7 ,the table of sections 
for subchapter ,h of chapter #db of the 
,internal ,revenue ,code of #aihf is    
amended by adding at the end the        
following new items3  ,sec4 #difi4      
,excise tax on contributions to colleges
 and universities by foreign countries  
of concern4 ,sec4 #digj4 ,excise tax on 
failure to report contributions by      
foreign entities4  4  7#b7 ,the heading 
of subchapter ,h of chapter #db of such 

,code 7and the item relating to such    
subchapter in the table of subchapters  
for such chapter7 are each amended by   
striking ,tax ,based on ,investment     
,income of and inserting ,taxes on4  7c7
 ,effective date ,the amendments made by
 this section shall apply to taxable    
years beginning after the date which is 
#fj days after the date of the enactment
 of this ,act4