Go to content Go to navigation Go to search

March 04, 2008

Congressional Aide Discusses Possible New Endowment Rules

A Congressional staff member discussed possible new requirements for university endowments — including a mandate that 5 percent of their value be spent each year on charitable expenses — at a session of the Washington Non-Profit Legal and Tax Conference.

Roger Colinvaux, legislation counsel to the Congressional Joint Committee on Taxation, noted that Congress has historically been concerned with preventing “unreasonable accumulations of income.” That concern led to the current rule that private foundations must spend a certain percentage of their assets each year. Lately, some senators have argued that university endowments represent an unreasonable accumulation, too, so it makes sense, said Mr. Colinvaux, that those endowments be subject to the same laws.

As for Congress implementing a payout requirement, Mr. Colinvaux said he was unsure if it would apply to all university endowments or just the largest endowments, those worth at least half a billion dollars.

He also said that Congress would explore whether to make the requirements different for public and private universities; what supporting groups, if any, should be included in counting assets; and what spending (such as on student aid, administrative costs, salaries, etc.) would count toward the 5 percent requirement.

— Sam Kean

Tuesday March 4, 2008 | Permalink

Comments

1. I sincerly hope that the aide looks at what is already being reported as charity.Many medical schoools ,like UT Southwestern Medical Center in Dallas,claim charity care that even their own auditors can not explain. 5% of the endowment should be placed in a pool that would be overseen by a non political appointee but rather directly to a fund that has oversight by taxpayers who vote in the normal elections as to where the funds should be given.Let these people make their case to the people,not the politicians.

   — Brent    Mar 14, 06:02 PM    #

Commenting is closed for this article.

Previous: New IRS Study Examines Charities' Business Activities
Next: Antipoverty Advocates Urged to Unite to Influence Next President

---

Copyright © 2009 The Chronicle of Philanthropy