University Statement on Proposed Tax Legislation

Dear Lehigh Community,

We want to inform you of Lehigh’s ongoing efforts to both monitor tax legislation currently making its way through the U.S. Congress and advocate with our Senators and Representatives on the potential impacts this legislation could have on Lehigh’s students, alumni, faculty and employees.

We believe several provisions in the tax legislation - titled H.R. 1, the Tax Cuts and Jobs Act - have potential to negatively impact Lehigh students and employees and affect the university’s ability to fulfill its educational mission. It is important to know that this bill is evolving daily as both the House of Representatives and the Senate craft their individual proposals, and it will undoubtedly change significantly as the process moves forward. Lehigh, along with our peer institutions of higher education, is engaging with our federal elected officials to make our concerns known throughout this iterative process.

Some provisions we have identified as being of particular concern to Lehigh include:

• Elimination of tuition remission - Taxing tuition remission would drastically increase the cost of graduate education nationwide, and effectively put it out of reach for many students.
• Elimination of employer-provided education assistance - Eliminating this benefit would affect both Lehigh employees and students who participate in executive education programs to build professional skills and remain competitive in their careers.
• Elimination of private activity bonds - As a nonprofit institution, Lehigh benefits from lower-interest financing for capital improvements, which enables the university to keep education costs as low as possible. Eliminating this option would increase financing costs considerably for Lehigh as we consider important expansion projects like building new residence halls and a new college of health.
• Private college endowment excise tax - Endowment funds are dedicated to specific uses, and one of the largest applications is for student financial aid; in 2016 Lehigh spent about 37 percent of distributed endowment resources on financial aid. A tax on the net investment of our endowment would divert targeted resources from our educational mission of making a Lehigh education available to students from all financial backgrounds, and affordable to all our students.

Lehigh will continue to vigorously pursue the results that best support our educational mission, and the interests of our students, faculty and staff. We encourage you to do the same, through social media and direct contact with your elected officials in Washington, D.C. You can find information about your own federal officials here: https://www.usa.gov/elected-officials

We appreciate moving forward with you in the interest of all our students, faculty and staff.

John D. Simon, President
Patrick V. Farrell, Provost and Vice President for Academic Affairs
Patricia A. Johnson, Vice President for Finance & Administration