US colleges facing the threat of federal funding cuts under President Donald Trump’s administration are tapping short-term borrowing to preserve cash.
Cornell University is set to roughly triple the size of its taxable commercial paper program to $1 billion, according to Moody’s Ratings. The school plans to replace an existing $1 billion tax-exempt program with commercial paper notes. Brown University and the University of Southern California are exploring similar strategies.
Commercial paper is a short-term financing tool widely used by companies, governments and colleges to fund infrastructure and other projects. Institutions often issue the notes as bridge financing before replacing them with long-term debt.
Bloomberg Politics
By Amanda Albright and Janet Lorin
April 4, 2025