In a virtual town hall event, President Michael Kotlikoff addressed Cornell’s settlement with the federal government that reinstated frozen research funding, fielding pre-screened questions from the Cornell community on Friday afternoon.
The $60 million deal effectively restored over $250 million in suspended federal funds and ended several federal discrimination investigations into Cornell. Over 80 grants totaling $40 million previously suspended by the Department of Defense were reinstated immediately, Kotlikoff said at the event.
Kotlikoff gave a brief introduction before answering questions asked in a Q&A-style discussion led by Kyle Kimball, vice president of University Relations. Among other topics addressed, Kotlikoff said the University remained financially insecure despite the reinstatement of research funding. He also defended the University’s incorporation of federal guidelines for discrimination as a training resource for all faculty and staff.
The guidelines outline the federal government's stance on discriminatory practices in higher education, which deem race-based decisions on admissions and hiring, diversity equity and inclusion programs, transgender athletes in sports and more as “unlawful.”
The Sun compiled the questions Kotlikoff was asked as well as his responses.
“Have the [stop-work orders] been lifted and how many, if any, amounts can you give us?”
In February, the federal government began issuing stop-work orders, rising to over 120 orders and amounting to about $250 million in cuts by May. Stop work orders are directives from a contracting officer to a contractor to stop all or parts of work for 90 days, at which point they expire or are extended. Provost Kavita Bala confirmed that the number of active stop-work orders remained essentially unchanged in an October interview with The Sun.
In a statement on Friday, Kotlikoff said the University reached a settlement with the federal government to restore over $250 million in research funding.
According to Kotlikoff, the Department of Defense has now restored 84 grants previously subject to stop-work orders, which equals an estimated $40.7 million. There is also a potential of $129 million in funding from the DOD to be restored for future years.
At the same time, Kotlikoff emphasized that not all of the funding has been returned, with the ongoing government shutdown complicating the government’s ability to return the funds.
“How does this agreement affect Resilient Cornell, the austerity budgets [and] do we still need to do Resilient Cornell?”
The launch of Resilient Cornell was announced on Oct. 16 in a statement to the Cornell community by Kotlikoff and other top University administrators. According to the statement, the initiative was designed to help decrease costs across all campuses via a restructuring of the University’s operations and workforce. Previous statements from the University described Cornell as facing “acute fiscal pressures.”
When asked about the necessity of Resilient Cornell, given the settlement and the restoration of federal funding, Kotlikoff emphasized that the issues that led to the formation of Resilient Cornell were apparent at Cornell before the stop-work orders and the frozen federal funds.
“We didn't agree to this settlement because of our financial issues, and the settlement itself doesn't resolve those financial issues,” Kotlikoff said.
Kotlikoff said that in the next few months, University administrators will be “walking through a[n] open process” with the Cornell community about how to achieve financial sustainability and goals in the future.
“I’m reading in different articles that we have agreed to abide by the 2025 DOJ guidance, but that's not how the agreement reads, can you describe how you see the difference?”
Kotlikoff emphasized that the Department of Justice guidance only represents guidelines and that “the University did not agree to abide by [the guidance] as law.”
The DOJ released the “Guidance for Recipients of Federal Funding regarding Unlawful Discrimination” on July 29 to “ensure that recipients of federal funding do not engage in unlawful discrimination.”
The guidelines state that race-based scholarships or mentorship programs, hiring decisions and certain DEI initiatives constitute “unlawful practices.” The guidelines also state that “permitting males to compete in women's athletic events,” including “those self-identifying as ‘women,’” violates federal law.
In the University's settlement with the federal government, it “affirmed” its compliance with federal civil rights laws and “agree[d] to include the Department of Justice's ‘Guidance for Recipients of Federal Funding Regarding Unlawful Discrimination’ of July 29, 2025 as a training resource to faculty and staff.”
“The agreement is being a little bit mischaracterized,” Kotlikoff. “We agreed to use the 2025 Department of Justice guidance as a resource for training our faculty. We have lots of resources to train our faculty and it’s important to understand and address the government's view of eliminating discrimination on campus.”
“Why did you negotiate with the government at all?”
Kotlikoff told the townhall that he has been asked “a lot” why the University decided to negotiate with the government and pointed out that it has been a “very, very difficult time” for faculty, staff and students at the University — specifically for those whose research funding was cut.
“All of that compelled us to try and understand what the issues were with the government and also to see if we could resolve those amicably,” Kotlikoff said.
He also explained that the government expressed "reasonable concerns” about discrimination on campus, which, he explained that the University has addressed in the past couple of months.
“Universities across the country have made significant progress since disruptions on campus on October 7 in articulating our rules, appropriately enforcing our rules and making sure that everybody's rights are protected,” Kotlikoff said.
“Can you talk about how this agreement might affect that conversation around indirect costs? Why isn’t that covered in the agreement?”
Indirect costs are expenses not directly related to specific research projects, but support general infrastructure and administrative costs that support University research. The federal government placed caps on these indirect costs, which Cornell responded to by joining various lawsuits, including those against the Department of Defense, the Department of Energy and the National Institutes of Health.
Kotlikoff told the Cornell community that the issues surrounding the indirect costs cap are a “much broader discussion” that is unaffected by this settlement. He also explained that Cornell has entered into these four major lawsuits in order to “stop the arbitrary reduction of these costs of doing research.”
Kotlikoff said that the legal proceedings have been successful and emphasized that current grants are currently paid at “the normal indirect rate.”
He ended his response by explaining that Bob Harrington, Cornell’s provost for medical affairs, has been working on the Financial Accountability in Research proposal, which Kotlikoff and Bala have been promoting nationally in order to maintain a fair cap on indirect costs of research.
“I'm hopeful that that conversation will lead to really a fair assessment by the government of the costs of doing research," Kotlikoff said. “That is in the interest of all of us in the country.”
“Why did it take so long [to reach a settlement]?”
In April, the federal government initially froze funding for Cornell amid a Title VI investigation launched by the Office of Civil Rights into Cornell and 44 other universities.
The New York Times initially reported the freeze to be $1 billion, according to anonymous U.S. officials. Cornell administrators later clarified that the cuts amounted to approximately $250 million in stop-work orders and grant terminations. $80 million was additionally owed from expenditures that the federal government was supposed to reimburse.
In August, Bloomberg reported that attempts at a settlement had reached up to $100 million. Kotlikoff later denied this claim in an October interview with The Sun, saying, “I wouldn't agree that we're necessarily very close to a settlement, and I wouldn't agree with a number that was published.”
Kotlikoff emphasized that Cornell’s settlement, compared to other similar agreements, prioritized the University's independence, faculty, students and curriculum.
“We were very concerned that we not agree to something that allowed the government excessive intrusion or oversight into our policies, procedures, data, etc.,” Kotlikoff said.
Additionally, the agreement requires that the federal government go through “the legal process” when raising concerns about the University, according to Kotlikoff.
When asked about whether or not Cornell administration was continuing talks with the Office of Civil Rights and Department of Education about Title VI concerns in an October interview with The Sun, Kotlikoff noted their lack of alignment with preexisting legal processes.
“There is a legal process by which Title VI cases are adjudicated,” Kotlikoff previously told The Sun. “The government really hasn't gone through those processes, so these become sort of more informal discussions about what is going on at Cornell, just educationally, and how we're making sure that there's no discrimination on campus against anyone.”
In regards to the agreement, the federal government must now officially go through legal processes to bring up any Title VI or discrimination concerns — a process that Kotlikoff noted was crucial for the safety and independence of the University.
“It was very important for us to secure and protect our own independence as a private institution,” Kotlikoff said. “To protect our faculty and their academic freedom and free inquiry, which is fundamental to our excellence and our ability to teach students in an appropriate way and to create new knowledge.”
“How will the funds going towards agricultural programs at Cornell be allocated?”
In the settlement, Cornell has agreed to pay $30 million to the federal government and an additional $30 million into research to strengthen U.S. agriculture.
When asked to address how the money will be allocated to Cornell’s agricultural endeavors, Kotlikoff explained that Provost Kavita Bala will design a plan to invest the money in research that satisfies both the interests of the U.S. government and Cornell.
“[Bala] will be talking with the community and work forward through a fair and competitive process to make sure that we fund the most impactful research in this area,” Kotlikoff said.
“Besides research, are there any degree programs that we are thinking about cancelling or revising based on this agreement?”
Kotlikoff highlighted that “the good news” of the agreement is that there will be no impact on Cornell’s academic curriculum or free speech on campus.
“Those were the issues that we were most intent on resolving [during] this dispute with the government without compromising our commitment to academic freedom or free speech,” Kotlikoff said. “Or I would add in compromising or any person, any study commitment.”
Zeinab Faraj is a member of the class of 2028 in the College of Arts and Sciences. She is the features editor on the 143rd Editorial Board and was the assistant sports editor of the 143rd Editorial Board. You can reach her at zfaraj@cornellsun.com.
Benjamin Leynse is a member of the Class of 2027 in the College of Arts and Sciences. He is a news editor for the 143rd Editorial Board and can be reached at bleynse@cornellsun.com.
