September 8, 2008 | Read Time: 1 minute
Sen. Charles E. Grassley, Republican of Iowa, and Rep. Peter Welch, Democrat of Vermont, may not typically have a lot in common politically. But they share a common concern over college costs in an era when many higher education institutions are accruing multibillion-dollar endowments.
Mr. Grassley and Mr. Welch are today holding a discussion on Capitol Hill to discuss just those issues, as well as a proposal to require colleges to spend 5 percent of their assets each year.
The problem, according to Mr. Grassley and Mr. Welch, is that colleges and universities are benefiting from their tax-exempt status and the investment returns on enormous endowments at a time when middle-class and low-income families are struggling to pay fast-rising costs of tuition.
In addition to the tax benefits, many colleges and universities receive federal grants for research, Mr. Grassley adds.
“Given the impressive investment returns of college endowment funds, even in years of economic downturn and as tuition has steadily increased, Congress would be remiss if it didn’t question what benefits tax-exempt colleges and universities provide in return for all of the federal benefits they receive,” he said in his opening remarks today.
