Endowment management questions find their way to Capitol Hill
- The U.S. House of Representatives' Ways and Means Committee will hear testimony beginning Sept. 13 on the state of college endowments and how schools are seeking to manage tuition costs with their use. Schools are expected to report on substantial losses which could prohibit extended investment in reducing student tuition.
- The House meetings follow similar hearings from the U.S. Senate earlier this session, during which more than 50 of the nation's schools with the highest endowments were asked to report on development and investment practices.
- Republican Representative Tom Reed says he is considering proposing legislation that will require schools to invest a percentage of endowment funds into increasing student access.
The latest round of inquiry by federal lawmakers comes in the midst of increasing scrutiny over the growth and use of college endowment funds, though it could be dismissed as little more than political posturing in an election year. And the federal government will remain the largest funder of higher education with grants, contracts and appropriations, so telling some of the nation's largest businesses how to spend the subsidies they afford for research and institutional development will be a difficult proposition.
Additionally, the federal government is likely to be confronted by larger and mid-sized public institutions about the impact of the federal government's recession, changes to its student loan program, and lack of intervention on state budget cuts, and how these things all contribute to a culture of saving money and passing costs onto families to ensure stability in future years.