While the Senate Republicans just passed a major tax overhaul on Friday, higher education writ at-large has been wringing its hands for weeks. Especially for colleges and universities with large minority populations, the bill would only pile on more financial obstacles.
Income tax on graduate student waivers, fewer deductions on student loans and the taxation of endowments are only some of the effects the GOP’s tax bill will have. According to experts, students at historically Black colleges and universities and other minority-serving institutions are especially vulnerable.
“In order to pay for the cuts in the Republican tax bill, there are quite a few programs on the chopping block, including some higher education programs,” Dr. Marybeth Gasman, Director of the Penn Center for Minority Serving Institutions, wrote in an email. “As many in the Republican party, including its leader Donald Trump, don’t value people of color, I worry about Minority Serving Institutions and the funding they deserve.”
According to a report published by the Center for American Progress, an older law called the Statutory Pay-As-You-Go, or PAYGO, Act, in conjunction with the GOP’s tax plan would result in the “complete elimination” of certain funds for HBCUs, Hispanic-serving institutions and tribal colleges, funds intended to help expand institutional capacity and student success. The PAYGO Act requires any legislation that increases the federal deficit to be offset by spending cuts or increases in revenue. According to a report from The New York Times, up to $255 million is at risk for higher education.
Community colleges, which serve large populations of minority and first-generation students, are resisting the tax plan. A call-to-action disseminated by the Community College League of California warned its members that the $1.5 trillion deficit that will accrue over ten years under the plan would be countered by diminishing federal funds for Pell Grants and career education, making programs crucial for underserved student populations more susceptible to elimination.
Another contentious issue is the elimination of tax deductions for students paying tuition and repaying loans.
“In my opinion, the GOP’s tax plan doesn’t support higher education because the elimination of state and local tax deductions will increase the cost of going to college, decreasing access to the affordable education community colleges provide,” said Dr. Rowena Tomaneng, president of Berkeley City College, which is a designated Hispanic Serving Institution (HSI) and an Asian American Native American Pacific Island Serving Institution (AANAPISI). Tomaneng added, “44 percent of my students receive financial aid, so this plan will impact about 5,000 students at BCC. These students will not be able to deduct taxes on their tuition and student loans.”
