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October 29, 2007

Senators Step Up Pressure on College Endowments

Some key lawmakers are stepping up pressure on colleges and universities to use more of their endowments to help curb tuition increases for their students, reports The Chronicle of Higher Education.

And one influential member of the Senate Finance Committee is becoming increasingly vocal about requiring colleges and universities to adopt foundation-like payout requirements for their endowments.

Sen. Charles Grassley of Iowa, the ranking Republican on the Senate Finance Committee, wrote in an op-ed article distributed this weekend to newspapers in his home state that he believes colleges and universities need to do more to make tuition more affordable.

Mr. Grassley writes that he believes government has a responsibility to help reach that goal. But he writes that colleges and universities have not done enough to curb costs — and some institutions have done so at a time when they have been amassing huge endowments.

“Some of those endowments are massive and have gotten so big, in large part, because they benefit from very generous tax breaks. Yale University’s endowment equates to $2.8-million per undergraduate. Tapping endowment returns to help keep college accessible to non-wealthy families seems more than reasonable,” Mr. Grassley writes.

“As the tax-writing Senate Finance Committee hammers out details of an education tax package, an endowment pay-out requirement ought to be included in the discussion to reduce tuition and help students afford college.”

— Peter Panepento

Monday October 29, 2007 | Permalink

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