When a large institution is faced with uncertainty about the future, it’s both feasible and prudent to make plans that account for multiple future outcomes. In this case, it makes sense to do both of the following:

1) Fight the administration in the legal system.

2) Plan for the case where some of those legal fights are lost.

What does it mean, concretely, to plan for that case? It doesn't sound like there's any risk of a scenario where, like, Columbia can't pay maintenance staff and all the buildings flood. If the US government freezes them out of grant funding, then the research funded by those grants won't be funded any longer - there's no careful planning you can do to make that less true.

A practical turn: can, say, Harvard or Yale answer: "Screw you, government, I don't need your money, go away!"?