From Dr. Jo Allen
There is no way to make a smooth transition from the Thanksgiving holiday to the US Senate’s tax reform bill, but we desperately need you to weigh in on behalf of Meredith College and our students and employees.
The projected schedule is that Senators will return to Washington and vote on their bill by the end of the week. Support for the Senate bill is much more fragile than in the House. But the leadership in Congress is determined to pass tax reform legislation, so I am writing to ask you to contact Senator Burr and Senator Tillis by Tuesday if you have not already done so.
Phone numbers, fax numbers, and the name and email of each senator’s education staff person are listed below. You can call and leave a message with the staffer answering the main phone number, fax a letter, or send an email to Chris Toppings in Senator Burr’s office or Kayla Dolan in the office of Senator Tillis. Our state and national organizations that advocate for private institutions such as Meredith have developed points that are critical to make with our Senators.
Fortunately, a number of components in the bill passed by the House targeting higher education are not in the Senate bill. We need to thank Senators Burr and Tillis for not including the following in the Senate bill and ask them to oppose any amendments that would eliminate student loan interest deductions, eliminate private activity bonds, tax tuition remission or tax employer financial support for employees’ higher education.
We do need to express grave concern that the Senate bill singles out private higher education (and not public institutions) for a 1.4 percent excise tax on endowments. (The current version is based on endowments of greater than $250k per student.) Others have noted the extreme irony of the federal government (with its $20 trillion debt) attempting to tax institutions that have exerted tremendous discipline to create “savings accounts” in the form of endowments, from which we take modest earnings to support scholarships, professional development, and campus maintenance for our students, faculty, and staff.
Some talking points on this issue are included below. Please use these in whatever way you would like, but it would be important to make the points in your words so the language in the various messages is not exactly alike.
*Establishment of this tax would set a precedent of taxing resources of private, non-profit higher education. Once in place, the tax could easily be expanded to include all private college and university endowments.
*This tax would pave the way for additional attempts to tax our tax-exempt colleges and universities–one of the key elements of our “not-for-profit” status.
*We are not in any way encouraging that public higher education be included in this proposal. Yet, it is important to highlight that taxing endowments would be bad public policy overall and singling out private colleges and universities would be even worse.
*Taxing endowments will lead to higher costs for students and to difficulty in fundraising when donors know their gifts will be taxed.
*Private college and university endowments are not like private foundations, despite the comparison Congress is making for this bill. The only private foundations that are taxed are those that make grants for other charitable activities. Private foundations that provide charitable activities/services are not taxed just as private college and university endowments that provide services to support education and research are not taxed.
Our concern is that these kinds of tax reforms will result in higher costs for students, a less competitive environment for recruiting and retaining top faculty and staff, and the curbing of critical donor support. Thank you for making these contacts. We are working closely with other national associations and will need to ask you to make contacts again when/if the bill goes to conference. Please know how much we all appreciate your support in helping us to KEEP COLLEGE AFFORDABLE!
Senator Richard Burr (R)
Education Staff Person: Christopher Toppings: Chris_Toppings@burr.senate.gov
Senator Thom Tillis (R)
Education Staff Person: Kayla Dolan: Kayla_Dolan@tillis.senate.gov