Senate Looking at Endowments as Tuition Rises
By KAREN W. ARENSON
New York Times
The Senate Finance Committee, increasingly concerned about the rising cost of higher education, demanded detailed information on Thursday from the nation’s 136 wealthiest colleges and universities on how they raised tuition over the last decade, gave out financial aid and managed and spent their endowments.
The committee also asked about endowment-related bonuses paid to college presidents and endowment managers.
The move came as a record 76 colleges and universities achieved endowments of $1 billion or more in the last fiscal year, according to a report released this week. Harvard’s endowment, the largest, grew 20 percent, to $34.6 billion, while Yale’s, the second largest, grew 25 percent, to $22.5 billion.
“Tuition has gone up, college presidents’ salaries have gone up, and endowments continue to go up and up,” said Senator Charles E. Grassley of Iowa, the ranking Republican on the committee. “We need to start seeing tuition relief for families go up just as fast.”
The committee, which has a central role in setting tax policy, has been pressuring universities to use more of their wealth for financial aid and threatening to require them to spend a minimum of 5 percent of their endowments each year, as foundations must. The committee pointed out that donations to universities and their endowment earnings were both tax-exempt.
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New York Times
The Senate Finance Committee, increasingly concerned about the rising cost of higher education, demanded detailed information on Thursday from the nation’s 136 wealthiest colleges and universities on how they raised tuition over the last decade, gave out financial aid and managed and spent their endowments.
The committee also asked about endowment-related bonuses paid to college presidents and endowment managers.
The move came as a record 76 colleges and universities achieved endowments of $1 billion or more in the last fiscal year, according to a report released this week. Harvard’s endowment, the largest, grew 20 percent, to $34.6 billion, while Yale’s, the second largest, grew 25 percent, to $22.5 billion.
“Tuition has gone up, college presidents’ salaries have gone up, and endowments continue to go up and up,” said Senator Charles E. Grassley of Iowa, the ranking Republican on the committee. “We need to start seeing tuition relief for families go up just as fast.”
The committee, which has a central role in setting tax policy, has been pressuring universities to use more of their wealth for financial aid and threatening to require them to spend a minimum of 5 percent of their endowments each year, as foundations must. The committee pointed out that donations to universities and their endowment earnings were both tax-exempt.
(Continued here.)
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1 Comments:
It's about time someone takes on education financing. We hear all too often about rising tuition and how the government needs to help families be able to afford college, but no one ever asks the colleges why their tuitions keep going up. Apparently, they are hoarding billions while simultaneously lobbying government for more tuition subsidies.
If we stopped subsidizing college tuition with grants and loans, colleges would be forced to lower their tuitions if students stopped going to college because they couldn't afford it OR colleges would have to subsidize tuition themselves through their endowments which is the point this piece is trying to make...and I agree!
Thank you Senator Grassley for taking on education at least a little bit. Colleges have been hoarding money for decades and all we hear from them is 'we need more'.
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