A new federal endowment tax enacted under recent legislation is already forcing colleges and university foundations to rethink investment, spending, and gift strategies, University Business reports. Public and private institutions with sizable endowments face higher effective tax burdens and are evaluating changes to spending rates, donor solicitations, and reserve policies to preserve scholarship and research budgets. Board finance committees and advancement offices are engaged in rapid scenario planning: some institutions are lowering spending rates, others are accelerating planned capital projects and donor campaigns, and a few are exploring structural mergers or program cuts. For boards and trustees, the development creates a governance imperative to reassess long-term financial assumptions and the sustainability of tuition-driven models.