§130aa–3 Withdrawals and Expenditures

Summary

The University may use its endowment income to pay for operation costs like upkeep, staff and administration, building projects, student and community programs, technical help, and research. It cannot use income or the fund’s principal to support its executive officers or to back any business started after January 1, 1981. In total, it must not spend more than 50% of the endowment income earned up to the time of withdrawal. The Secretary can allow spending over 50% for a financial emergency (like pending insolvency or a cash shortfall), a life‑threatening disaster (natural or arson), or another urgent unusual event. If the University spends more than allowed, it must repay 50% of the improper amount to the Secretary. If it takes principal, it must repay 50% of that principal plus any income earned on it.