Gubernatorial Hopeful Wants to Tax Massachusetts’ Private Colleges

“I think it’s fair to ask the wealthiest among us ... to contribute to our greater community.”

Jay Gonzalez, winner of the Massachusetts Democratic gubernatorial primary, speaks at a Massachusetts Democratic Party unity event in Boston, Wednesday, Sept. 5, 2018. (AP Photo/Bill Sikes)

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Massachusetts’ big-name private colleges, including Harvard, MIT and Boston University, could fund the state’s public schools under a contentious proposal by Democratic candidate for governor Jay Gonzalez.

Gonzalez said Wednesday that he hopes to impose a 1.6 percent tax on nonprofit college and university endowments over $1 billion, WBUR reports. Gonzalez’s campaign contends that the tax could generate an estimated $1 billion a year, with more than half coming from Harvard. The funds would be earmarked for transportation and public school initiatives.

“I think it’s fair to ask the wealthiest among us — including major institutions that have accumulated enormous wealth in part thanks to their exemption from taxation — to contribute to our greater community,” Gonzalez told reporters this week, according to the AP.

Higher education leaders don’t see it that way.

“We’re surprised, disappointed and thought it was a terrible idea,” Richard Doherty, president of the Association of Independent Colleges and Universities in Massachusetts, said recently, WBUR reports. He said that endowments are used to fund things like financial aid and research and added that if funding is cut, those programs suffer.

Incumbent Republican Gov. Charlie Baker agreed that the plan was a bad idea, and compared it to a similar proposal made by President Donald Trump earlier this year.

Others, like Zac Bears of the Public Higher Education Network of Massachusetts, believe the tax would be even the balance between the elite schools and their public counterparts.

“UMass Amherst alone educates more Massachusetts residents than these nine large private colleges combined,” Bears told WBUR. “We need to invest in our public higher ed system, and these institutions have more than enough money to help us do it.”

Massachusetts isn’t the only region considering how to pump money into its higher education system this voting season. In Denver, residents will ‘yay’ or ‘nay’ a college scholarship tax. A previous version of the tax went before voters in 2015 — as Next City covered at the time — and was narrowly defeated. Its aim was similar to the tax Gonzalez is proposing, but on a citywide, rather than statewide scale.

“I think that if we’re successful, there will be a lot of interest across the country looking at this model,” Stephen Jordan, president of Metropolitan State University of Denver, told Next City at the time. “There are a lot of large communities like Denver out there, within states that are constrained to provide for higher ed institutions and where there’s a significant population of first-generation college students who are priced out of four-year colleges.”

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Rachel Dovey is an award-winning freelance writer and former USC Annenberg fellow living at the northern tip of California’s Bay Area. She writes about infrastructure, water and climate change and has been published by Bust, Wired, Paste, SF Weekly, the East Bay Express and the North Bay Bohemian

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Tags: taxeseducation

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