Congress passed the Bipartisan Budget Bill last week that President Trump signed into law. That bill includes a provision that restores language Senator Mitch McConnell had originally proposed for inclusion in last December’s Tax Reform and Jobs Act to exempt schools with fewer than 500 tuition-paying students from the endowment income excise tax.
That language, which had been removed just before the Tax Reform legislation passed in December as a result of Democratic opposition, now will shield Berea College from the tax. That tax would have cost the College about $1 million each year and would have significantly hindered Berea College in carrying out our mission of providing a no-tuition education to as many students as possible. Had the tax remained on schools such as Berea, the result would likely led to reducing the number of students we are able to serve.
Kentucky’s elected delegation — particularly Senator McConnell and Representative Andy Barr — were very responsive to our advocacy in this matter, and I have conveyed our thanks to them.
The language in the Bipartisan Budget Bill is significant in another way because it provides a direction that other small colleges and universities with significant endowments can follow. The bill enables them to work toward aiding more students from disadvantaged populations and avoid this new levy on their resources. In that sense, this measure may represent a small, but important, victory for affordability and access to higher education beyond Berea College.
Lyle Roelofs is the president of Berea College.