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Columbia and NYU Would Lose $327M in Tax Breaks Under Proposal

nytimes.com

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Re: Columbia and NYU Would Lose $327M in Tax Breaks Under Proposal

#31

Post by lvl102 »

selimthegrim wrote: post #28
lvl102 wrote: post #5

Earlier quoted context omitted.

This is very true. NYU and Columbia should not be treated as not-for-profit because they’re not. And they also take money from sovereign and let them influence research and curriculum. They do not deliver the value even remotely commensurate with tax savings they enjoy. Especially NYU. Only schools of value at NYU is medical, law, and film. So roughly 3,000 students. They enjoy billions in tax savings and not even re…

Uh, Courant?

I knew I’d get this response and that’s very fair. It’s a great school for quants but it’s also very small.

Re: Columbia and NYU Would Lose $327M in Tax Breaks Under Proposal

#32

Post by neuromantik8086 »

throwaway-blaze wrote: post #25
ChrisBland wrote: post #3

At some point we do need to look at the hedge funds that have a school attached as well. The endowments at some of these universities is astounding.

Agreed. If they are, as claimed, in the business of educating students, why not use some of that endowment money to open more campuses and educate more students? Columbia offers admittance to fewer than 3% of the people who apply. More people than those admitted have the requisite grades etc to think they'd perform well at an elite school; why not offer more of the admittance and use the endowment to make it happen?…

Because endowments aren't piggy banks. They're regulated by UPMIFA [1], which states that universiteis can't draw down more than 7% of the total funds in the endowment unless they can prove that it would be prudent to do so, and the burden of proof is extremely high.

Even without UPMIFA, endowments are a mix of unrestricted and restricted funds, and donor restrictions can and do prevent universities from using money when they might otherwise want to. Even if a university desired to draw down the full 7% allowed without triggering red tape, it's unlikely that they would be able to draw it all without running afoul of donor intent.[2]

If anything, the system is to blame here, not the universities themselves necessarily (not to excuse bad apples in academic administration).

[1] https://en.wikipedia.org/wiki/Uniform_Prudent_Management_of_...

[2] https://en.wikipedia.org/wiki/Donor_intent

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