Senate, Like House, Would Tax Endowments, but Go Easier on Other Higher Ed Provisions

DC Shuttle …

Senate Releases Tax Bill. The Republican-led U.S. Senate released a tax bill that would impose a new 1.4% excise tax on the earnings of endowments at private universities. The new tax, which is also in the House bill, would apply only to private, not public, universities that have at least 500 students and endowment assets of at least $250,000 per student. The Senate bill would keep a slew of education-related tax deductions and credits, valued at roughly $65 billion over the next decade, that are slated for elimination in the House plan. That includes deductions for student loan interest and college tuition and related expenses. The Senate plan wouldn’t touch any of the higher education tax credits that the House plan would eliminate and consolidate. Read More in Inside Higher Ed.

Ed Dept Begins to Rewrite Gainful Employment Rule. The Trump administration has selected the members of an Education Department rulemaking panel that will be charged with rewriting an Obama-era rule aimed at for-profit colleges and other career college programs. The members of the panel will convene next month to negotiate a replacement for the “gainful employment” rule. The regulation cuts off federal aid to career college programs that produce graduates with high amounts of debt relative to their income. Education Secretary Betsy DeVos has taken steps to delay implementation of the regulation and ease the appeals process for some college programs that failed the metrics.

Administration Withdraws Career and Technical Education Nominee. The Trump administration withdrew the nomination of Michigan state Rep. Tim Kelly for a career and technical education position at the department after blog posts Kelly wrote surfaced in which he expressed views on gender and religion. Kelly’s nomination was withdrawn due to old blog posts in which he proposed a no-fly list for Muslims and made derogatory comments about Head Start parents and efforts to recruit women into the sciences. Read more in Politico.

Administration Opposes Ban on Arbitration Agreements for Colleges. The Trump administration signaled to members of an Education Department rulemaking panel that the administration opposes a complete ban on colleges’ use of mandatory arbitration agreements. The department’s negotiated-rulemaking committee plans to meet next week for the first time to begin work on the administration’s replacement for the borrower defense to repayment rules. The department argued that banning mandatory arbitration agreements and class-action waivers violates the Federal Arbitration Act and suggested that the Higher Education Act doesn’t empower the government to create such a ban.

We publish the DC Shuttle each week featuring higher ed news from Washington collected by the New England Council, of which NEBHE is a member. This edition is drawn from the Higher Education Update in the Council’s Weekly Washington Report of Nov. 13, 2017. For more information, please visit:


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