Tom Reed continued his fight for students, as the House Ways and Means Committee prepares to hold a hearing on the dramatic growth of college endowments. “We care about helping students and working families afford college. That’s why we are working on a proposal that will require colleges and universities to submit a plan detailing their efforts controlling college costs.  Its only right that we go beyond our endowment proposal and address the real culprit of rising college costs.” said Reed.

The House Ways and Means Committee, of which Reed is a member, will hold a hearing about the uses of college endowments. Witnesses include small colleges and universities who are taking innovative steps to address the rising cost of college and ensure accessibility for all.

In 2015 alone, Harvard earned $5.5 billion in endowment returns, enough to fully eliminate the tuition costs for all 6,700 undergraduate students at the university. In the same year, the undergraduate tuition rate was $45,278 or $60,659 for tuition, room, board and fees.

“This is a fundamental question of fairness. We expect to hear testimony that demonstrates that using endowment funds for tuition relief is not only possible, but smart policy for colleges. Working families and young graduates are struggling and we must come together to develop proactive solutions that will get this problem in check.”

In conjunction with the hearing and the Committee’s ongoing efforts, Reed continues to work on his Reducing Excessive Debt and Unfair Costs of Education (REDUCE) act, which requires colleges with endowments larger than $1 billion to distribute a portion of the profits earned from this money as tuition relief for students from working  families. If colleges fail to offer this amount of financial aid, they face tax penalties, up to and including lose of their tax exempt status.  In addition, the bill will include a requirement for colleges and universities to develop a cost containment plan to keep tuition increases in check. Failure to develop a plan will also result in the loss of tax exempt status.

This is the second committee hearing on the topic of rising college costs, and follows a letter sent this spring to the 56 private universities with endowments over $1 billion requesting addition information on their use and management.

“There is no silver bullet for controlling college costs but we can come together and find common ground that will protect our students and their families from skyrocketing tuition,” Reed concluded.