In a move to combat student debt, U.S. Rep. Tom Reed (R-NY) wants universities with an endowment exceeding $1 billion to redistribute a portion of that as scholarships for students from working-class families or face stiff tax penalties.
“I care about ensuring higher education is affordable and accessible for middle class families,” Reed told The Ripon Advance. “It’s only fair that we fight for these students by requiring universities to use their resources to put these students first and to keep tuition costs in check.”
The amount of student debt in the United States currently exceeds $1.3 trillion, the college financial services advisory group FinAid reports, with that number climbing by an average of nearly $3,000 per second.
The requirement for universities to distribute some of their endowments back to students is aimed at easing the burden this student debt crisis places on the middle class and slow the rate at which the debt bubble grows.
“The goal is to ensure
fundamental fairness as many students and families are struggling to pay
for college, while at the same time tuition rates continue to rise and
university endowments continue to grow tax-free,” Brandy Brown,
communications director for Reed’s office, also told The Ripon Advance. “It’s only fair that universities start putting funding directly back into the pockets of students.”
This is an important step, especially to Reed whose district encompasses 17 colleges, universities and trade schools, including public and private universities.
“Any time we alleviate the crushing debt burden of students and families, it increases their buying power, which can then be used to stimulate the economy,” Brown said.