Many colleges and universities have accumulated massive, mostly tax-exempt endowment funds. These endowments receive millions of dollars in tax-deductible gifts every year and obtain government subsidies through current tax laws that dwarf anything received by public colleges and universities.
The purpose of these tax exemptions and subsidies is to encourage colleges to distribute the profits from their investments to help offset the costs of attendance. Unfortunately, this has not been the case. Instead, these schools have amassed billions, and even spent these funds on frivolous items, while ordinary students and their families struggle with a lifetime of crippling student loan debt. This debt has long-term negative consequences for our economy and our future as a nation.
I care about the students who are being taken advantage of by the unfair costs of college. In most cases, the richer the school, the smaller the percentage of working class students are being served by the college.
We currently give these schools huge tax breaks and subsidies, and it is time they start serving the working-class taxpayer who supports them.
So I introduced a bill to reverse this trend that
• Requires colleges to have a plan to keep tuition increases below the rate of inflation.
• Mandates reporting of easily digestible information about how colleges are being managed and where their money is spent.
• Requires the wealthiest universities to distribute 25 percent of the profits from their massive endowments to assist students from working-class families.
• Encourages university donors to give money that will assist low and middle-income students and eliminates tax deductions for large restricted college donations.
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