March 8, 2010
Senator Charles Grassley (R-IA) stated that the National Association of Colleges and University Business Officers latest survey on higher education endowments, showing steep declines in their rates of return, is not excuse for institutions to raise tuition or freeze student aid.
Grassley said that many colleges in recent years relied on risky investments, such as hedge funds, to get large gains and are now experiencing losses as a result.
He said “students shouldn’t bear the brunt of colleges’ easy-come, easy-go investment strategy and a lot of colleges still have plenty of money in the bank.”
Grassley emphasized that there may be a need for a mandatory payout requirement for college and university endowments—an idea he has endorsed in the past.
Source: Non-Profit Legal & Tax Letter, February 22, 2010
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