What Did I Miss in Washington? May 14-28, 2019
The steady stream of news emerging from the nation’s capital can be overwhelming. NACUBO highlights key actions and provides the status of top higher education business concerns.
On the Hill
Retirement Matching Based on Student Loan Repayment Bill Introduced
Sens. Wyden (D-OR), Cantwell (D-WA), Cardin (D-MD), Whitehouse (D-RI), Hassan (D-NH), and Brown (D-OH) have introduced legislation that would create an opportunity for employers to provide retirement matching funds for employees based on what they pay each month toward their student loans, rather than what they contribute to retirement.
Potential ‘Kiddie Tax’ Fix Introduced in House
Ways and Means Chairman Rich Neal (D-MA) has introduced an amendment that would offer a fix for the “kiddie tax” issue to retirement security legislation (H.R. 1994). This issue is the result of a change made in the Tax Cuts and Jobs Act that caused a child’s unearned income over $2,100 to subsequently be taxed at the trusts and estates rate instead of their parents’ top marginal tax rate. The issue first gained major media coverage because of the unintended tax consequences faced by Gold Star families on their survivor benefits.
Members of Congress Show Support for Tax-Exempt Bonds
More than 100 members of Congress, led by co-chairs of the Municipal Finance Caucus Representatives Dutch Ruppersberger (D-MD) and Steve Stivers (R-OH), recently sent a letter to House Ways and Means Committee leadership expressing support for tax-exempt municipal bonds. The letter argues that “any proposal to eliminate or reduce the value of the tax exemption on municipal bonds will raise borrowing costs for our state and local governments, reduce infrastructure investment in the communities we represent, and stall or threaten job creation.”
White House Eyes Pell Surplus
In an amendment to its FY20 budget request, the White House proposed to eliminate $3.9 billion from Pell Grant surplus funds instead of the $2 billion in cuts it had proposed earlier this year. The additional cut would fund priorities of the Trump administration.
Higher Education Community Weighs In on New Overtime Rule
NACUBO joined a group letter that supports the Department of Labor’s updated salary threshold—$679 per week ($35,308 per year)—and made other suggestions for improvement.
Continue to Monitor Triggering Events
While May 14 was the initial borrower defense rule deadline for colleges to notify the Department of Education of any financial responsibility actions, events, or conditions occurring after July 1, 2017, the reporting requirement continues. Business officers should make sure they have a mechanism in place for monitoring and reporting triggers. ED has indicated that additional guidance clarifying the reporting requirements is forthcoming.