A recent proposal from the Treasury Department aims to revoke tax-exempt status from private educational institutions that consider race in admissions or financial aid. While this might seem like a straightforward tactic against discrimination, the implications of such a move could be profoundly damaging.
Around 18,000 private colleges and schools could face significant financial strain if this rule is implemented. For institutions that already operate with razor-thin budgets, losing tax-exempt status could mean a sharp drop in charitable contributions, as donations would no longer provide tax deductibility. Investment income might also face taxation, leading to overall reduced funding and program closures.
The students who would bear the brunt of this change are often those who can least afford it: first-generation college students, working parents, and underrepresented minorities seeking pathways to higher education.
This concern is particularly acute for historically Black colleges and universities (HBCUs), tribal colleges, and other minority-serving institutions. These schools frequently implement recruitment and support programs designed to correct historical disparities. Punishing these institutions, which aim to create an inclusive educational environment, could set back the progress of many students.
Understanding this context requires acknowledging the historical role of minority-serving institutions. As a Spelman College alumna, I can attest to the vital mission these colleges fulfill. Their existence responds directly to a legacy of exclusion that sought to deny certain groups a chance at academic success.
For example, during the early 1900s, American colleges often implemented quotas to limit Jewish student admissions. In contrast, HBCUs opened their doors to marginalized scholars who faced discrimination elsewhere. This history demonstrates that institutions created for one historically excluded group can extend opportunities to others who suffer similar injustices.
Scholarship initiatives and support systems at these colleges are designed not to favor specific demographics but to rectify ongoing imbalances that have prevented equal access to education. Providing additional resources to first-generation students or developing support programs targeting Native American learners is not an act of exclusion; it’s an essential effort to bridge the gap created by centuries of inequity.
These measures enhance the college experience for all students, fostering an environment where background does not dictate success. Programs targeting underserved populations exist because students from these groups face legitimate barriers. Ignoring the impact of history and the presence of these barriers does not eliminate them; it merely complicates their resolution.
If the Treasury's proposal is enacted, colleges will encounter a difficult choice: risk their financial viability or abandon the important programs designed to reduce disparities. The end result is detrimental to students and, ultimately, to the nation's need for a well-educated workforce.
The debate around access to education should be treated with nuance. Reasonable perspectives will differ on how best to affirm equal opportunities in higher education. However, penalizing institutions genuinely trying to broaden access does not just misidentify the problem; it also neglects the students who would be affected most by these sweeping changes.
Colleges at stake symbolize not only the potential for academic advancement in America but also the moral imperative to provide equitable educational opportunities. These institutions stand as testimony to the progress we can achieve when we choose inclusivity over exclusion.
Yolanda Watson Spiva is president of Complete College America, an organization committed to closing educational attainment gaps and increasing college completion. She is also a co-author of “Daring to Educate: The Legacy of the Early Spelman College Presidents.”
For inquiries, contact the opinion editor at [email protected].
This opinion piece on the potential changes to colleges’ tax-exempt status was produced by The Hechinger Report, a nonprofit organization dedicated to addressing inequality and innovation in education. Sign up for our weekly newsletter.
