SENATE BILL: Independent Educational Institution Relief Act (Redraft Passed)

[Chancellor Tanterterg]

Aye

[Goldwater]

AYE

[TNF]

AYE

I am curious  to know why Senators Talleyrand and TNF prefer to remain with the original version of my bill rather than this amendment.

I prefer not to amend the original bill at all.

[🐒Gods of Prosperity🔱🐲💸]

AYE

I am curious  to know why Senators Talleyrand and TNF prefer to remain with the original version of my bill rather than this amendment.

I prefer not to amend the original bill at all.

This is a vote on the amendment and not a final vote.  If this vote fails we will go back to the bill as I introduced it.

[President Tyrion]

Nay

[tmthforu94]

Aye

[bore]

Abstain

[Talleyrand]

My concern here is the same as Tyrion's. It seems very likely colleges and universities will attempt to use their athletics programs to avoid taxation (and I do not believe that athletics programs should be exempt from taxation under the amendment you've proposed either, were it to pass).

[🐒Gods of Prosperity🔱🐲💸]

My concern here is the same as Tyrion's. It seems very likely colleges and universities will attempt to use their athletics programs to avoid taxation (and I do not believe that athletics programs should be exempt from taxation under the amendment you've proposed either, were it to pass).

We can work on a fix for the loophole of using athletics to divert tuition to corporate profit. However, to place this tax on all athletics programs would be creating a new tax and it's not something I can support.

[Fmr. Pres. Duke]

Do for-profit institutions even have athletic programs? Regardless, I am still not fully sold on giving these degree mills any sort of tax relief whatsoever.

[🐒Gods of Prosperity🔱🐲💸]

Do for-profit institutions even have athletic programs? Regardless, I am still not fully sold on giving these degree mills any sort of tax relief whatsoever.

A few points:

We are talking in some cases about nationally and/or regionally accredited programs, so if the intent is to go after diploma mills, this is not a good proxy.  These places may provide programs that would not otherwise be easily available to people, even if the quality varies greatly.

We have already cut all federal loans, which for most for-profit colleges was the majority of their source of revenue.

The large for-profit universities and corporations will be paying a 45% rate under this bill (20% + 25% corporate tax). If I need to pull that up a few percentage points to get support for this bill, I will.

This bill encourages universities to invest more of their revenues in educational pursuits and to offer loan forgiveness programs.  The current policy does neither.

Finally, the tax in the previous bill affected more than just for-profits, so if nothing else let's fix that.

[Southern Senator North Carolina Yankee]

AYE

[🐒Gods of Prosperity🔱🐲💸]

What of I made this simple change in the wording?:

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I think that would address the diversion issue so that if it ends up as profit taken out of the programs, it is not exempt since it is still derived from tuition.

[Fmr. Pres. Duke]

Do for-profit institutions even have athletic programs? Regardless, I am still not fully sold on giving these degree mills any sort of tax relief whatsoever.

A few points:

We are talking in some cases about nationally and/or regionally accredited programs, so if the intent is to go after diploma mills, this is not a good proxy.  These places may provide programs that would not otherwise be easily available to people, even if the quality varies greatly.

We have already cut all federal loans, which for most for-profit colleges was the majority of their source of revenue.

The large for-profit universities and corporations will be paying a 45% rate under this bill (20% + 25% corporate tax). If I need to pull that up a few percentage points to get support for this bill, I will.

This bill encourages universities to invest more of their revenues in educational pursuits and to offer loan forgiveness programs.  The current policy does neither.

Finally, the tax in the previous bill affected more than just for-profits, so if nothing else let's fix that.

Diploma mills may be nationally accredited. Just look at the number of for-profit law schools that have sprung up in the last 10-15 years. They are nationally accredited, but their employment numbers and qualify of education are still garbage, but they are accredited because they are money making machines.

We can fix the issue where the tax affected more than just for-profits. I don't want to tax schools that are nonprofits.

I don't foresee any of this really affecting the price of tuition though. The real root of that problem is that higher education is now heavily subsidized by the government, and in turn, colleges have raised their tuition rates because there is enough demand for their services and easy money to pay for them. Unfortunately, I don't see this bill really changing all that much.

With that rant aside, I am fine with clearing up the language in the bill to make the tax affect for-profit schools only, because I really don't believe you need to be making huge profits off education.

[Southern Senator North Carolina Yankee]

Vote on Amendment 59:46 by shua I think:

Aye (5): Goldwater, X, NC Yankee, shua, Spiral and Tmthforu94
NAy (3): Talleyrand, TNF and TyriontheImperialist
Abstain (1): bore

Didn't Vote (0):
Vacant Seats (1): Spiral

With time having expired, the amendment is adopted.

[🐒Gods of Prosperity🔱🐲💸]

Do for-profit institutions even have athletic programs? Regardless, I am still not fully sold on giving these degree mills any sort of tax relief whatsoever.

A few points:

We are talking in some cases about nationally and/or regionally accredited programs, so if the intent is to go after diploma mills, this is not a good proxy.  These places may provide programs that would not otherwise be easily available to people, even if the quality varies greatly.

We have already cut all federal loans, which for most for-profit colleges was the majority of their source of revenue.

The large for-profit universities and corporations will be paying a 45% rate under this bill (20% + 25% corporate tax). If I need to pull that up a few percentage points to get support for this bill, I will.

This bill encourages universities to invest more of their revenues in educational pursuits and to offer loan forgiveness programs.  The current policy does neither.

Finally, the tax in the previous bill affected more than just for-profits, so if nothing else let's fix that.

Diploma mills may be nationally accredited. Just look at the number of for-profit law schools that have sprung up in the last 10-15 years. They are nationally accredited, but their employment numbers and qualify of education are still garbage, but they are accredited because they are money making machines.

We can fix the issue where the tax affected more than just for-profits. I don't want to tax schools that are nonprofits.

I don't foresee any of this really affecting the price of tuition though. The real root of that problem is that higher education is now heavily subsidized by the government, and in turn, colleges have raised their tuition rates because there is enough demand for their services and easy money to pay for them. Unfortunately, I don't see this bill really changing all that much.

With that rant aside, I am fine with clearing up the language in the bill to make the tax affect for-profit schools only, because I really don't believe you need to be making huge profits off education.

I find the idea that for-profit education=diploma mill to be a gross simplification, but okay.  I guess I just expended a lot of useless effort trying to bend over backwards.

[Fmr. Pres. Duke]

My assumption could be incorrect. I'm just going off my own knowledge of for profit educational groups that run schools. Many of these sprung up during the economic downturn to take advantage of all the people going back to school. If there are some reputable for profits, I will reconsider my position on them.

[Southern Senator North Carolina Yankee]

Is this finished?

[🐒Gods of Prosperity🔱🐲💸]

My assumption could be incorrect. I'm just going off my own knowledge of for profit educational groups that run schools. Many of these sprung up during the economic downturn to take advantage of all the people going back to school. If there are some reputable for profits, I will reconsider my position on them.

I don't know what you would need.  I don't know that there's any one standard for what defines a reputable college that can be referenced.  Clearly people have different experiences if we are going by anecdotes, and it will depend a lot on the specific programs.

How about the bill as it stands?  Can you accept the language with a few changes or do we need to start over?

[Fmr. Pres. Duke]

Reinvesting back into the facilities has never been an issue for for-profits. The bill as it is is pretty much tailored to what they'd want to see out of us. They're known for having terrific facilities to divert attention away from their poor academic record. I have no qualms with what they spend their money on, typically their facilities are excellent, it's the product they put forward.

I am okay with the tax rebate for forgiving loans of students. At the very least, that will help the student out with the debt these for profits shoulder onto them.

[🐒Gods of Prosperity🔱🐲💸]

Reinvesting back into the facilities has never been an issue for for-profits. The bill as it is is pretty much tailored to what they'd want to see out of us. They're known for having terrific facilities to divert attention away from their poor academic record. I have no qualms with what they spend their money on, typically their facilities are excellent, it's the product they put forward.

I am okay with the tax rebate for forgiving loans of students. At the very least, that will help the student out with the debt these for profits shoulder onto them.

If they are investing it in their facilities they are doing the same thing non-profits do. 

Can you support it being a tax on profits rather than a tax on revenue?

[🐒Gods of Prosperity🔱🐲💸]

ECPI:  rated best online/nontraditional college for vets by Military Times.

eCornell:  subsidiary of Cornell U, organized as a for-profit, providing distance education.

I was trying to come up with a way that colleges would be taxed based on what they do with tuition money rather than whether the simple designation of for profit or non profit.  A college that spends twice as much money on academics and student programs as given to shareholders should be treated differently than when the proportion is the reverse, imo.  But what I'm hearing is that's not politically feasible.

I'm reconsidering the loan forgiveness thing. I want encourage debt relief, but be careful not to disincentivise colleges that do a better job keeping their students out of massive long-term debt.  I think maybe I'll go with a tax deduction (rather than a tax credit) for debt relief, matched with requiring a share of monetary responsibility in case of default.

[Southern Senator North Carolina Yankee]

I am wondering if we painted with a broad brush with regards to these private institution. We need to have a clearer and more detail standard more so then just that they are for profit.

[🐒Gods of Prosperity🔱🐲💸]

I am wondering if we painted with a broad brush with regards to these private institution. We need to have a clearer and more detail standard more so then just that they are for profit.

 

I was trying to make that point, but wasn't having much success.

In any case, here is my last attempt at this.  It addresses the concern about diversion of profits, I bumped the rate back up to 50%, and I added some accountability on default.  If this can't pass I don't know what will.   The modest standard deduction is to make this tax a tiny bit progressive and to hopefully keep small mom and pop shop vocational educational programs from being strangled for no reason.  If someone has a specific change they'd like to make to this, I'd encourage them to let the amendment go through and then offer their own amendment to it.

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[TNF]

I object.