Yale University is planning to raise $850 million by selling bonds in May. This move follows a trend among top universities that are turning to the financial markets for funding, especially as the Trump administration increases scrutiny of these institutions.

The bond sale will include two parts: one will be $500 million in tax-exempt bonds, and the other will be $350 million in taxable bonds. According to a notice Yale shared with investors on Wednesday, both bond offerings are expected to be available during the week of May 5. The tax-exempt bonds may be set up as fixed-rate put bonds, with mandatory tender dates that are at least three years after they are issued. The funds from these bonds will be used for facility-related needs and seem to follow long-term plans. In January, S&P Global Ratings reported that Yale was planning to issue up to $500 million in additional debt by June. The taxable bonds might be structured with a certain amount tied to an index, with a set maturity period, such as 7 or 10 years. The funds from these bonds will be used for general purposes.

While the notice doesn’t mention the uncertainty around federal funding, it comes at a time when Yale has received a warning from the US Department of Education’s Office for Civil Rights. The department has threatened enforcement if the university doesn’t do more to protect Jewish students from antisemitic discrimination and harassment. Sixty universities received similar warnings. Other Ivy League schools have also recently turned to the taxable bond market, attracted by easier access and fewer regulations. Harvard and Princeton have sold bonds in recent months, and Brown University recently took out a $300 million loan. Some schools are doing this to strengthen their financial position in case federal support is at risk. A spokesperson for Yale did not respond to a request for comment.

Other prestigious schools, such as the University of Pennsylvania and Stanford University, have also recently turned to borrowing money as they face ongoing challenges with taxes and funding. Yale holds high credit ratings from Moody’s and S&P Global Ratings, thanks to its large endowment of over $41 billion and its strong reputation. “Credit challenges include a moderately high reliance on endowment earnings for operations, which can pressure the university’s fiscal operations in the event of prolonged market weakness, and moderate exposure to potentially volatile clinical revenue,” analysts at Moody’s Ratings warned in a May 2024 report. “An effective risk management framework and exceptional financial strategy provide some offset to these challenges.”