Over the last two years, tax-exempt colleges and universities have become targets of increased scrutiny by the Secretary of Education, the Internal Revenue Service ("IRS") and the Senate Finance Committee. With the looming budget crisis and an ever-increasing deficit, regulators are taking a hard look at whether these institutions are providing the public benefits commensurate with the tax breaks they receive as a result of their tax-exempt status.
The recent credit crunch that destabilized the mortgage market and leaked to student loans, along with a heightened public awareness of the impacts of student debt, has brought to light the very real need for student loan reform. As we watched the events of the past few months unfold, the higher education community has been forced to face the fact that the dislocation in the credit markets could pose a real threat to the delivery of student aid.
A USA TODAY HEADLINE states, “Tuition Hikes Will Ease.” The article opens, “The price tag for college tuition is continuing to climb this year, but experts are predicting less sticker shock than in the past two years.”
AT LAST--AFTER SIX YEARS, three Congresses, and 14 extensions of the existing law, the House and Senate finally agreed to legislation reauthorizing the Higher Education Act, and in August President George W. Bush signed it.