College and university administrators are facing uncertainty on several federal fronts. Questions abound on policies, from how to implement new taxes enacted in the Tax Cuts and Jobs Act of 2017 to the outlook for undocumented students.
Heading into fall, we await legislative, regulatory, and judicial movement on a number of issues with major implications for college students and institutions of higher education. It is unclear when lawmakers will take action; enactment of major legislative changes is not expected until after Election Day in November.
Is there official guidance from the Department of Education on Title IX responsibilities for handling campus misconduct?
Institutions, at present, should rely on the Department of Education’s (ED) Office of Civil Rights (OCR) 2001 revised sexual harassment guidance. However, NACUBO expects ED to propose new OCR guidance regarding Title IX this fall.
In February 2017, the Departments of Justice and Education civil rights divisions withdrew guidance issued by the Obama administration on non-discrimination—particularly for transgender students—under Title IX.
In September 2017, OCR withdrew the policy statements and guidance provided in an April 2011 Dear Colleague Letter and a 2014 questions and answers document. At the same time, OCR provided a new interim Q&A to help schools guide their investigations and adjudication of allegations of campus sexual misconduct.
Has the Higher Education Act (HEA) been reauthorized?
No. Efforts to reauthorize the HEA restarted in 2017 when, in December, House Education and Workforce Committee Chair Virginia Foxx (R-NC) released a 542-page proposal that would make significant changes to federal student aid programs. While approved in committee, the bill has not yet been approved by the House. On July 24, House Democrats released their version of a reauthorization bill. The Senate has yet to introduce reauthorization legislation.
Neither the Democrat nor Republican bills are likely to advance in the House this year; however, business officers should take note of the proposed reforms, as they may appear in future conversations and legislation addressing HEA.
NACUBO encourages business officers to ensure that their colleagues (e.g., other campus administrators, such as financial aid directors and government relations officials) understand the potential impact of the current proposals that would institute a risk-sharing regime, change the Return to Title IV process, and disburse "aid like a paycheck." Additional information about the HEA and these three proposals are available on the NACUBO website.
What will the maximum Pell Grant award be for 2019–20?
Congress passed a sweeping budget deal and stopgap spending package earlier this year that raised caps on both discretionary and non-discretionary spending—and promised an additional $4 billion for higher education over the next two years for "student-centered programs that aid college completion and affordability." Lawmakers, however, have not yet agreed on specific spending levels for federal FY19 (award year 2019–20). In draft legislation, members of the House would maintain the maximum Pell Grant award at its current level ($6,095), while Senate budget writers are calling for a $100 increase for the maximum Pell Grant award.
Is the new nonprofit parking tax real?
Following passage of the Tax Cuts and Jobs Act (TCJA), public and private colleges, and the entire tax-exempt sector, now face additional tax liabilities and compliance challenges, including a new unrelated business income tax (UBIT) on certain fringe benefit expenses (including transportation and parking), and a different approach to computing business income for unrelated business activities.
The "parking tax" is unprecedented in that it characterizes certain necessary expenditures as taxable income, thereby increasing, rather than lowering, operating costs. In addition to an executive compensation excise tax, and a requirement to separately account for business income from unrelated business activities (basketing), the new fringe benefit tax is raising questions for all tax-exempt entities, including colleges and universities.
NACUBO had hoped to see guidance from IRS and the Treasury Department by June 30 on some of these issues, but it appears that regulators have been inundated with rulemaking needs flowing from passage of the TCJA and it is unclear when guidance will be published on these issues.
Rep. Mike Conaway (R-TX) has offered H.R. 6037, the Nonprofits Support Act, which would repeal the TCJA changes to the transportation fringe benefit (IRC §132(f)) as well as the new UBIT basketing provisions. Other lawmakers have introduced similar legislation, however, election-year gridlock and other considerations make it highly unlikely that the parking tax, or other TJCA nonprofit tax requirements, will be repealed anytime soon.
Are students with DACA (Deferred Action for Childhood Arrivals) status still protected from deportation?
Yes. DHS is currently processing DACA renewal requests, but is not reviewing any new DACA applications.
In April, D.C. District Court Judge John Bates, ruled that DACA’s rescission was arbitrary and capricious because the Department of Homeland Security "failed adequately to explain its conclusion that the program was unlawful … ." DACA was originally slated for elimination based on orders from the Trump administration in September 2017. That ruling, which was given at the end of April, allows the department 90 days to develop a better explanation for DACA’s elimination, otherwise it orders that the program be reinstated entirely.
It’s expected that the department will appeal this decision. Alternatively, seven state attorneys general have filed suit against the Trump administration, challenging DACA’s constitutionality. This suit alleges that DACA’s creation under the Obama administration overstepped the authority of the executive branch and should be rescinded immediately, although it does present the possibility for a two-year phaseout elimination of the program as a compromise.
Earlier this year, the U.S. Supreme Court declined to weigh in prematurely on the legality of DACA’s elimination, stating that it would wait until lower appellate courts had reviewed the cases. While it was hoped that the multistate judicial conflict that’s arisen over DACA would urge the Supreme Court to act sooner, we still await further judicial action in the lower courts.
Two GOP immigration bills recently failed to pass in the House of Representatives. The bills represented divergent opinions within the Republican party about the DACA program; the more moderate of the two bills, H.R. 6136, contained a pathway to citizenship for DACA recipients, which some conservative lawmakers criticized as "amnesty." The more conservative measure, H.R. 4760, did not include a solution for DACA, and included provisions tightening legal immigration. Lawmakers were unable to secure enough votes to pass either measure.
NACUBO CONTACT Liz Clark, senior director of federal affairs, 202.861.2553, @lizclarknacubo