The cost of tax reform to our students

Monday, November 27, 2017

President Kaler sent this message to the entire University community and a similar message to civic, business and political leaders across the state.

As the federal tax bill works its way through the U.S. Senate, our graduate students who work as teaching (TA) and research assistants (RA) urgently need our help. Right now.

The bill already passed by the House of Representatives would hit our more than 5,000 TAs, RAs, and other graduate assistants (GA) especially hard, and so, negatively impact the highly-skilled talent force we prepare at the University of Minnesota, a workforce that fuels our state's economic vitality. And this bill would likely discourage many of our undergraduates from pursuing advanced degrees. The fact is this tax bill will affect us all.

Here's what it would do to our grad students who teach our undergrads and who collaborate with our world-class faculty. The bill would count tuition reduction for TAs, RAs, and GAs as taxable income. That means if a TA receives a $1,000 tuition waiver for teaching, that $1,000 would be taxed. This provision would see our graduate students' taxes increase but without any additional dollars in their pockets. 

That simply doesn't make sense, and it unfairly shifts the tax burden to those who can least afford to pay while they're contributing mightily to our University and our state. And, from a public policy perspective, the effects of fewer degree-seeking graduate students will surely be felt by employers.

One more thing: the House bill eliminates a $2,500-per-year student loan interest deduction, which would have a negative impact on all students, particularly those students in our professional programs, such as medicine, veterinary medicine, pharmacy, and dentistry. As you know, they often incur six-figure debt to pay for their education.

A Top Ten public land-grant research university like ours depends on the world's most creative grad students, and they rightly rely on us for support. That's why we have been working so hard these past few weeks to stop these harsh tax changes. Members of our Board of Regents and I have directly reached out to members of our Congressional delegation. I've made myself available for interviews to national media outlets to explain this flawed direction of the tax bill and will continue to advocate for our students.

As both House and Senate bills have developed, the University's Government Relations advocacy network has generated more than 20,000 emails to members of Congress, but we need to do even more, right now.

We need to pull together as a community and raise our voices to help our graduate students. The Senate may vote this week. Through our UMN Advocates website, you can reach members of our Congressional delegation to tell them to support our students.

Our voices matter to support the scientists, policy makers, and civic, cultural, and thought leaders of the future who study and work among us. Your voice will mean supporting a stronger Minnesota. It will mean supporting our students, our colleagues, and our friends.