High ed tax reform ripple: Effect could affect local economies beyond campuses

Garrett Neese/Daily Mining Gazette Michigan Technological University President Glenn Mroz addresses the crowd at a protest of potential tax hikes on graduate students Wednesday.

HOUGHTON — Placing the burden of lower revenue from tax reform on the backs of higher education and its students will be felt in the communities beyond campus, Michigan Technological University President Glenn Mroz said during Tech’s campus protest on Wednesday.

Mroz said graduate students enhance the local economy while attending school and boost the national economy when they graduate. He told about 75 protesters Wednesday he’s not sure the politicians in Washington, D.C., understand that.

“I wish I could tell you that’s valued more than it is right now, but apparently it’s not,” he said. “When I talk to our representatives and our senators, especially our senators, they get it. They understand it. They’re likely to vote against the bill, but I don’t think there’s enough people who will vote against it.”

In addition to categorizing tuition waivers as taxable income — which hurts both students and universities — the House bill would also eliminate the tax deduction on student loans. Universities would also be barred from tax-exempt refinancing of bonds.

“When you start to add all these things up, it means that it’s going to get to be more expensive, which really doesn’t make a lot of sense,” he said. “We’ll work with this in the best ways that we can to control costs, because you guys are important to us … We like balancing the budget, but our core thing is that we have people who leave Michigan Tech and are capable of doing really special things for a lot of people in the world.”

In comments following the protest march against the pending tax reform legislation, Mroz explained how the tuition waiver was also a benefit for employees to university — which ultimately benefits the university and the local economy where those employees and their families live.

“We want people to upgrade their skills all the time,” he said. “Now people are going to be taxed for trying to improve themselves.”

Mroz said it’s hard to tell what the effect of the tax hike on graduate students would be on enrollment, as Tech’s has been increasing in recent years. He said the university would try to assist students.

“We’ll try to do whatever we can in terms of offering scholarships, particularly for the students who are here now,” he said.

Right now, Mroz said, universities are watching to see if the provisions made it into the final legislation. So far, the bill being worked on in the Senate lacks many of the details being protested by universities.

“If people weigh in with their representatives and say, ‘Education’s important to me,’ this is the time to do it,” he said.