Stop Taxpayer Funding for Universities and Colleges

Stopping federal and state governments from using taxpayer funding for universities has potential benefits:

 

Redistribution of Resources: Cutting government funding could redistribute resources to other areas of need, infrastructure, debt reduction and most importantly Medicare and Social Security.

 

Fiscal Responsibility: It would promote fiscal responsibility and accountability within universities, encouraging them to use their resources more efficiently and transparently.

 

Reduce Dependence on Public Funds: Encourages universities not to rely less on public funds and use their endowments and become more self-sufficient, fostering innovation and entrepreneurship in revenue generation.

 

Fairness: It addresses concerns about fairness by ensuring that wealthy institutions with substantial endowments contribute more than their fair share to society, especially when they benefit from tax-exempt status.

 

Budgetary Relief: Cutting government funding would provide budgetary relief for governments facing financial constraints, allowing funds to be allocated to other priorities such as Medicare and Social Security.

 

Here is a structured plan to strip elite universities of government funding and federal student loan dollars (taxpayer-funded) with key components ASAP.

 

Assessment of Current Funding Streams: A comprehensive review of the government funding and federal student loan dollars allocated to elite universities. This includes grants, research funding, student aid programs, and other forms of financial assistance is already available to lawmakers.

 

Establish Criteria for Elite Universities: Define criteria that determine which universities qualify as "elite." This must include factors such as endowment size, selectivity in admissions, academic reputation, research output, and financial resources.

 

Gradual Phase-Out Approach: Implement a 3-year phased approach to gradually reduce and eventually eliminate government funding and federal student loan dollars for elite universities over this 3-year predetermined timeframe. This allows universities to adjust their budgets and operations accordingly.

 

Redirect Funding to Priority Areas: Reallocate the government funding and student loan dollars saved from elite universities to prioritize areas such as border protection and reduction of debt.

 

Legislative Action: Draft and propose legislation to amend existing laws and regulations governing government funding and federal student loans to elite universities. This may involve changes to eligibility criteria, funding allocation formulas, or enforcement mechanisms.

 

Public Awareness and Support: Build public awareness and support for the plan by highlighting the rationale behind redirecting funding from elite universities to other priorities.

 

Monitoring and Evaluation: Establish mechanisms for monitoring and evaluating the implementation of the plan and adjust as needed based on feedback and performance metrics.

 

Enforcement and Compliance: Enforce compliance with the new regulations and ensure that elite universities adhere to the revised funding guidelines. Implement penalties for non-compliance, such as fines, and loss of accreditation.

 

Long-Term Sustainability: Develop strategies to ensure the long-term sustainability of the revised funding framework, including periodic reviews, updates to eligibility criteria, and ongoing dialogue with stakeholders.

 

By following this plan, policymakers can effectively strip elite universities of government funding and federal student loan dollars while promoting equal access to education and supporting priority areas for all Americans and not elite universities and colleges.

 

REASONS and FACTS for The PLAN:

The substantial taxpayer-funded financial resources available to Ivy League universities, from federal funding along with their private and corporate donated considerable endowments, raise questions about the allocation of these funds and their impact on affordability and access to higher education.

A newly released report, by Open the Books, an organization that aims to make public spending more transparent, shed light on the enormous sums of money the federal government (taxpayers) provides to Ivy League universities — and how that money is handled.

It concluded that in the six fiscal years between 2010 and 2015, $41.59 billion of the Ivy League’s money could be traced back to taxpayer-funded payments and benefits.

To put that in perspective, the average amount of money that the eight Ivy League schools received annually over that time — $4.31 billion — exceeds the amount of money received by 16 of the 50 states.

The report also examined Ivy League endowments, some of the country's largest. Penn’s endowment for 2015 was the fourth highest, at $10.1 billion. In 2016, it climbed to $10.7 billion.

The Ivy League’s total endowment is around $120 billion, which amounts to about $2 million per undergraduate student. A sum of that size could give every Ivy League student a full ride for the next 51 years.

Between 2010 and 2015, the eight schools received $23.89 billion in federal grants $10.6 billion of which came from the U.S. Department of Health and Human Services and the National Institutes of Health.

Other sources of grant money were the National Science Foundation, the Centers for Disease Control and Prevention, the Department of Defense, and the Department of Energy.

Research grants and contracts weren’t the only forms of government support for Ivy League schools. The government also provides various forms of aid grants to colleges — in the six years the report investigated, Penn received $20,362,715 for the federal work-study program and $33,155,056 in Pell Grants.

The report also showed the comparatively low state funding Penn receives. While Cornell received $98.91 million from New York in 2015, Penn received just $19,233.

Financial aid at the Ivy League schools is most often need-based, which is offered based on a student’s financial need, rather than merit. However, the available range is generous, with many schools offering a zero-parent contribution for families of a certain income.

For example, students from families with an income of less than $85,000 can attend Harvard University for free. Additionally, Dartmouth College offers a scholarship covering at least the cost of tuition for families making under $125,000[55].

The number of students offered financial support is also reassuring with 62% of Princeton University undergraduates receiving financial aid for the Class of 2025. Many Ivy League schools also offer financial aid to international students.

Further, these schools also rely on significant federal funding. For example, in 2021 Harvard received $625 million in federal funds, or approximately 67% of the school’s total sponsored revenue that year.

From the government side, student financial aid accounts for the lion’s share of federal dollars that go to colleges and universities. In 2018, 65% of the $149 billion total in federal funds received by institutions of higher education went toward federal student aid. This covers scholarships, work-study and loans given to students for their educational expenses, according to USA Facts, a nonprofit site that collects government data.

In 2018, federal money made up 14% of all college revenue. About 3.6% of total federal spending went toward higher education investments.

Colleges and universities received $1.068 trillion in revenue from federal and non-federal funding sources in 2018.

The federal government directed 65% of its $149 billion investments to federal student aid which covers scholarships, work-study and loans given to students for their educational expenses.

Harvard University received the largest federal grant: $179 million from the National Institute of Health. Columbia University received the second largest grant, $165 million, invested from the Centers for Disease Control and Prevention.

Hawaii, Alaska, and Vermont public universities had the largest revenues from federal grant and contract investments per student enrolled in public colleges and universities.

California, Texas, and Michigan public universities were the top recipients of federal grant and contract money in 2018, receiving a quarter of federal grant and contract revenue across all public universities.

States collectively allocated $11.7 billion (or 10.2 percent) more for higher education in the 2024 fiscal year than they did in 2023, significantly outpacing the rate of inflation and more than compensating for the continuing decline in federal recovery funds distributed through state governments.

The states spent a total of $126.452 billion in 2024, up from $114.734 billion in 2023.

Other states with increases of roughly 20 percent included Nevada (19.9 percent), New Mexico (19.2 percent), North Dakota (20.1 percent), South Carolina (24.2 percent) and Utah (21.8 percent).

State support for higher education declined by 12.3 percent in Vermont and by 8.7 percent in the much larger Pennsylvania.

Sources:

https://www.openthebooks.com/assets/1/7/Oversight_IvyLeagueInc_FINAL.pdf

https://shef.sheeo.org/grapevine/#about-grapevine

https://shef.sheeo.org/

https://nces.ed.gov/programs/digest/d20/tables/dt20_333.20.asp