Federal Tax Proposals and the Columbia Community

Dear fellow members of the Columbia community,

This is a pivotal moment for tax legislation in the United States.  We understand there are strongly felt positions about the fairness of legislation now under consideration in Congress and its potential impact on both our economy and our society.  As an academic community, our immediate concern is with a number of provisions that, if adopted, would threaten access to higher education for low- and middle-income students, and inevitably harm the teaching, research and public service mission of private colleges and research universities.  We want you to know we are doing everything we can, on our own and in partnership with many peer institutions in higher education, to oppose these damaging proposals. 

While there are differences between the plan passed by the House of Representatives and the bill now before the Senate, both contain provisions that could have a significant impact on the tax liabilities of students, faculty, and employees.  The House-passed version would change current law that helps students and their families afford higher education, including changing the tax treatment of tuition waivers granted to countless graduate students across the country, eliminating the deduction for interest on student loans, and taxing tuition-benefit programs that enable so many of our faculty and employees to defray certain educational costs for themselves and their families.  These and other similar provisions are of the deepest concern to us.

At the same time, both the House and Senate proposals would impose an excise tax on the income generated by the endowments that many leading private colleges and universities depend on each year to support our institutions’ core missions.  Such a tax on endowment earnings would reduce the resources available for student financial aid, faculty salaries and other critical needs.  This is especially counterproductive at a moment when leaders across the political spectrum speak of increasing access to quality higher education opportunities.  These proposals would have the opposite effect—raising costs and reducing access for those from low and middle income families for whom scholarship support is essential.

We have been working hard over recent weeks to voice the strongest possible opposition to these and other changes in the federal tax code that would adversely affect our students, faculty and employees, and their families.  Alongside peers and national associations in Washington, we have been engaging key decision-makers and numerous members of Congress of both parties in a concerted effort to educate them about the damaging consequences of their plans for the nation’s commitment to higher education.

The outcome of any final legislation remains in question, as do the specific fates of each of these harmful provisions, so it is too soon to know what will emerge if and when the House and Senate attempt to reconcile their respective tax bills.  If you do wish to express your views about these matters, you can contact your elected representatives.  We will, in all events, keep you updated about these and other developments in Washington that affect the Columbia community.

Sincerely, 

John H. Coatsworth
Provost

Lee Goldman, MD
Dean of the Faculties of Health Sciences and Medicine
Chief Executive, Columbia University Medical Center