UMass comes out strongly against tax reform plan

Tuesday, December 05, 2017

AMHERST — Chancellors at the University of Massachusetts’ five campuses as well as the university’s president are urging U.S. lawmakers to oppose the federal Tax Cuts and Jobs Act.

In a letter dated Monday and sent to the state’s nine representatives and two senators, the university officials highlight eight points they say would negatively affect the university and its students.

“The University of Massachusetts believes that both current versions of the tax reform legislation would have serious adverse impacts on the university, our students and our employees,” the five university chancellors and University President Martin T. Meehan stated.

Amherst, Smith and Mount Holyoke colleges announced their opposition to the bill earlier this month. Much of their concern centered around the proposal to end college endowments’ tax-free status. Hampshire College is the only college in the five college consortium that has not publicly taken a stance on the tax bill.

“We’re not commenting at this time,” spokesman John Courtmanche said in an email Tuesday.

One of the leaders of the graduate student union at the University of Massachusetts Amherst has called the proposed tax bill “an attack on the American university system,” and said if approved it would lead to a massive drop in graduate students.

“I think it’s part of a wider picture of chipping away at institutions like UMass and universities in general. It’s part of a dumbing-down in America in which education is just not valued,” said Santiago Vidales, co-chairman of the Graduate Employee Organization/United Auto Workers Local 2322. “If this tax plan goes through, we are potentially going to see a decrease in enrollment and participation, especially in minority populations.”

If passed, the bill would repeal part of the tax code that exempts tuition waivers granted to graduate students, who teach or conduct research activities at their respective universities, from consideration as gross income.

Throughout the five campuses, approximately 5,000 students are seeking advanced degrees. With the tax bill looming, the campus chancellors and university president said those same students “now face the specter of being taxed for income they don’t even receive.” As Vidales explained it, the bill would tax graduate students as though they were making $60,000 to $70,000 when in reality, they made closer to $20,000.

That same issue has resulted in the creation of a tax calculator by the Graduate Student Senate which gives a rough estimate of the new tax liability a graduate student would face under the tax bill.

“Many graduate students at UMass fear that if this bill were to become law, they would need to quit their programs or take out additional loans or part-time jobs,” the Graduate Student Senate wrote in a letter to Rep. James McGovern. “At a time when America needs to invest in education to remain competitive in a changing world, the proposed bill would make it difficult for universities to recruit graduate students to conduct cutting edge research and mentor undergraduate students.”

The student senate also argued that the bill would create a “homogeneous group of the independently wealthy” graduate students that would rob the university “of the diversity of perspec tives and experiences  that make our current system thrive.”

For Vidales, the bill puts the whole university system in a perilous situation.

“This is a do-or-die moment, ” Vidales said. “If this tax goes through, I would have to drop out. It’s just that simple.”

Vidales said the union has had many conversations about the proposed tax bill, and many members have expressed anger, frustration and concerns about what will happen if it is approved.

“If we were to get taxed on our tuition waiver, it would be absolutely ruinous,” Vidales said.

Vidales said he was glad the university was putting pressure on lawmakers but said more was needed.

Graduate Student Senate president Canan Çevik said she believes legislators supporting the bill are unable to perceive the long-term, wider implications of the tax bill provision pertaining to higher education. The group has also written to UMass Amherst Chancellor Kumble Subbaswamy.

“Education is one of the most important equalizers across different contexts and an indispensable investment in humans and the future,” Çevik wrote in an email. “Making higher education not available to the majority but only to a very few, I would say it is a betrayal to one's own future and society.”

The bill would also eliminate the lifetime learning credit and the Hope scholarship tax credit although it would extend the time-limited American Opportunity Tax for a fifth year.

Other objections to the bill concern the elimination of the deductibility of student loan interest and the limiting of colleges’ and universities’ access to capital markets.

Emily Cutts can be reached at ecutts@gazettenet.com.