NACUBO Expresses Opposition to Bills Attacking University Tax Exemption
July 12, 2024
Chairman Jason Smith
House Committee Ways and Means
1102 Longworth House Office Building
Washington, DC 20515
Ranking Member Richard Neal
House Committee on Ways and Means
1102 Longworth House Office Building
Washington DC 20515
Subject: Opposition to H.R. 8913 — The Protecting American Students Act and H.R. 8914 — the University Accountability Act
Dear Chairman Smith and Ranking Member Neal:
On behalf of the National Association of College and University Business Officers (NACUBO), I write to express our opposition to H.R. 8913 — the Protecting American Students Act and H.R. 8914 — the University Accountability Act, both of which were passed out of committee on July 9.
NACUBO is a nonprofit professional organization representing chief administrative and financial officers at more than 1,700 nonprofit and public colleges and universities across the country. NACUBO works to advance economic vitality, business practices, and support for higher education institutions in pursuit of their missions. We are dedicated to sound fiscal and administrative practices at institutions of higher education.
H.R. 8913
H.R. 8913 expands the excise tax on endowments, by excluding non-U.S. citizens and permanent residents from the endowment-per-student calculation. NACUBO remains strongly opposed to the endowment excise tax which already diminishes charitable resources available for financial aid, research, academic support, public service, and innovation. This measure will result in incumbering higher education institutions with additional financial strain and administrative red tape, particularly those committed to providing financial aid and access to low- and middle-income students. The expanded tax would weaken the financial stability of these institutions without addressing the root issues of college affordability and student debt.
This legislation further serves as punitive measure on institutions enriching and enlightening higher education classrooms and research laboratories with the interaction of students from other nations. Promoting international education is an investment in the quality and preparedness of U.S. national security and economic growth.
H.R. 8914
H.R. 8914 seeks to modify the current Title VI enforcement structure, by broadly imposing substantial financial penalties on institutions receiving an adverse ruling. The current Title VI enforcement regime administered by the Office for Civil Rights (OCR) at the Department of Education, already provides robust protections against hate-based discrimination. Numerous Title VI investigations and recent resolution agreements underscore the federal government’s extensive authority to mandate changes to campus policies and operations. Rather than improving existing mechanisms to combat hate-based discrimination, this bill would likely result in costly and time-consuming litigation, potentially imposing heavy fines on institutions. These legal battles would divert essential resources away from effective Title VI compliance and student protections, undermining rather than supporting efforts to maintain a safe campus environment. The potential fines and litigation costs would also strain resources at colleges and universities, ultimately impacting educational programs and student services.
Both measures pose critical challenges to business operations at institutions of higher education. The potential legal and financial ramifications, should these bills become law, would strain resources that are essential for maintaining quality in educational programs and student services.
We strongly urge the House to withdraw H.R. 8913 and H.R. 8914 from further consideration.
Please contact Ashley Jackson, Director of Government Affairs at NACUBO at ajackson@nacubo.org or Mary Bachinger, Director of Tax Policy at NACUBO, at mbachinger@nacubo.org for any additional information or to arrange a meeting to discuss this matter further.
Sincerely,
Kara D. Freeman
President and Chief Executive Officer
National Association of College and University Business Officers
Washington, DC
Cc:
U.S. House of Representatives
darryll k. jones