Proposes Innovative Higher Education Endowment Tax to Fund Critical Investments
CAMBRIDGE – Gubernatorial candidate Jay Gonzalez is proposing a new investment of $1 billion per year towards education and transportation priorities. Gonzalez’s proposal would help make high-quality childcare and preschool affordable for every child and family; fully fund our public schools; make our public universities and community colleges affordable and debt-free; and fix and improve our public transportation, roads and bridges. Gonzalez’s proposal would not increase taxes on Massachusetts’ families.
“This new investment will help regular people in our state who are facing some very real challenges. As Governor, I will have an ambitious agenda to take those challenges head-on,” Gonzalez said. “We need to be honest about what it’s going to take to fix our broken transportation system and an education system that is leaving too many of our young people behind. We need to aim higher.
“I think it’s fair to ask the wealthiest among us – including major institutions that have accumulated enormous wealth in part thanks to their exemption from taxation – to contribute to our greater community. With $1 billion in new investments each year, we can make real progress toward delivering a reliable, modern public transportation system and creating a public education system where every child in this state has the opportunity to succeed.”
Gonzalez has pledged that every child and family in Massachusetts will have access to high-quality, affordable childcare and preschool by the end of his first term. As Governor, he will also fully fund our public schools to ensure that every child has access to a great public education, and he will make our public universities and colleges affordable and debt-free for students.
Gonzalez has also pledged to invest new resources to fix and improve our public transportation system, including the MBTA, regional public transit and our roads and bridges. Massachusetts ranks 45th in the country for the condition of its transportation infrastructure and 47th in commute times.
Gonzalez’s proposal calls for a 1.6% tax on the endowments of private, non-profit colleges and universities with endowment funds exceeding $1 billion. There are currently nine colleges and universities that would be included: Harvard University, MIT, Williams, Boston College, Amherst, Wellesley, Smith, Tufts University, and Boston University. Each of these endowment funds has seen an average annual return of between 4.8% and 8.4% over the past 15 years.
One report estimated that Harvard University received the equivalent of $48,000 in taxpayer subsidies for each of its 6,700 undergraduate students. Meanwhile, the University of Massachusetts at Boston will receive less than $8,000 in state funding in FY19 for each of its 13,000 undergraduates.Many of the students who attend our private, non-profit higher education institutions leave Massachusetts after they graduate, but most students who graduate from our public universities and colleges stay in Massachusetts.
“Ask any public classroom teacher and they’ll tell you that our schools are critically underfunded, and they have been for years,” said Beth Kontos, President of the the AFT Massachusetts. “The large tax-free investment funds operated by the wealthiest colleges and universities can certainly afford to do more to address this problem, and they should. I applaud Jay Gonzalez for his leadership on this issue. Leading is what Governors are supposed to do.”
“Charlie Baker’s refusal to make new investments in our transportation and education systems is holding regular people back,” said Cambridge Mayor Marc McGovern. “We deserve more from our governor, and that’s why I’m so excited to support Jay Gonzalez and his ambitious plan to invest $1 billion in our future. Universities and colleges with endowments in the billions of dollars – including those in the city where I am proud to be Mayor – can and should be contributing more to help the regular people who are struggling to get ahead in Massachusetts.”
“I strongly support Jay Gonzalez’s bold proposal to tax wealthy college endowments, in order to make the investments in transportation and education that Massachusetts needs,” said State Senator Jamie Eldridge (D-Acton), a Boston College Law School graduate. “We can no longer afford a status quo governor who protects the wealthy like Charlie Baker, and Jay Gonzalez’s vision will create a Massachusetts economy and quality of life that works for everyone.”