AICUM Blog
Business Community Offers Support for 529 Legislation

A broad coalition of business groups and chambers of commerce joined AICUM in sending a letter to House Ways and Means Chairman Brian Dempsey supporting legislation to create a state tax deduction for contributions that Massachusetts families make to their 529 college savings plans.

 

AICUM was joined on the letter by the Greater Boston Chamber of Commerce; Springfield Regional Chamber of Commerce, South Shore Chamber of Commerce, Massachusetts Taxpayers Foundation, Massachusetts High Technology Council; and the Massachusetts Business Roundtable.

 

A copy of the joint letter can be view here.

 

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State House News Covers 529 Legislation Momentum

This morning, the State House News Service published an article detailing legislation that emerged last month from the Joint Committee on Revenue that creates a tax deduction for families saving for college in Massachusetts.

 

AICUM has long supported a state-level college savings tax incentive that helps families save for their children’s futures. The vast majority of income tax-levying states offer such incentives – and Massachusetts is one of only eight outliers.

 

We are hopeful that the Legislature continues this momentum for the betterment of families across the state.

 

State House News Service:

Supporters See Favorable Conditions to Pass College Savings Tax Incentive

By Michael Norton

 

In the closing days of the 2014 race for governor, Charlie Baker was asked during a televised debate which of Martha Coakley’s campaign ideas he wished was his first. He replied that it was a college tuition savings tax deduction.

 

It’s still a long way from his desk in the State House’s Corner Office, but a bill targeting the college affordability crisis by delivering a new incentive for families to save has cleared committee with a unanimous bipartisan stamp of approval and comes this year with a new plan to cover most of its costs to the state.

 

The idea is also paired with favorable polling. In an October 2015 MassInsight survey conducted by Opinion Dynamics, 76 percent of respondents strongly or somewhat favored a new income tax deduction for college savings accounts, with 24 percent somewhat or strongly opposed.

 

Supporters of the bill (S 1468) say 42 states have income taxes and Massachusetts is among only eight of those states that do not have a tax incentive to encourage families to make contributions into a college savings program, sometimes known as 529 plans. As a result, contributions must be made with after-tax income and, according to the bill’s sponsor Lowell Democrat Sen. Eileen Donoghue, many families with plans don’t contribute, nullifying their value.

 

The redrafted bill endorsed by the Legislature’s Committee on Revenue on a 12-0 vote features a $1,000 annual deduction for single filers and a $2,000 deduction for joint filers, down substantially from $5,000 and $10,000 limits featured in Donoghue’s original bill.

 

Using the $1,000 and $2,000 thresholds, the bill would cost state government about $8.2 million, but it includes language limiting an existing tax deduction for college tuition payments to Massachusetts residents only. That move would offset all but about $1.2 million in costs while helping families to start saving earlier for college, supporters said.

 

According to the Association of Independent Colleges and Universities of Massachusetts (AICUM), tax deductions for contributions to college savings accounts range from $500 to $1,000 in Rhode Island and $2,500 to $5,000 in North Carolina to $5,000 to $10,000 in Connecticut and New York and $10,000 to $20,000 in Illinois and Oklahoma.

 

The bill’s largest obstacle may be the Legislature’s recent aversion to embarking on tax policy debates. Aside from expanding the state’s earned income tax credit, Beacon Hill lawmakers and Gov. Baker have not teamed up on major tax policy changes since Baker took office in January 2015. Baker and House Speaker Robert DeLeo ruled out new or higher taxes in this spring’s state budget deliberations.

 

But like Donoghue, Revenue Committee Co-chairman Sen. Michael Rodrigues said the college savings deduction may draw support this session because it addresses a problem that’s attracted increasing national attention and helps many families who the senators said are often not often the beneficiaries of tax policy changes.

 

“This is one I think that does make the most sense,” Rodrigues told the News Service, adding, “It really helps the middle class and they found a way to pay for it.”

 

According to AICUM, the personal income tax college tuition deduction allows for a deduction for tuition payments to a two- or four-year college if tuition costs exceed 25 percent of the filer’s Massachusetts adjusted gross income. The deduction is open to anyone who derives Massachusetts income, resident or non-resident, and is not limited to payments to colleges or universities in Massachusetts.

 

Nearly 13 percent of the deduction’s claimants in tax year 2013 were from out of state, according to a Department of Revenue analysis sought by supporters of the college savings deduction bill. The tuition deduction’s overall cost to the state rose to $54.2 million in fiscal 2016, up from $35.9 million in fiscal 2013.

 

The bill authorizes the college savings tax deduction starting in 2017 and the deductions would expire after 2021 unless reauthorized by lawmakers. In states with similar deductions, they are largely claimed by families earning $150,000 or less per year, Donoghue said.

 

“This is a solid benefit for the middle class and I think there are very few out there for the middle class, to be candid,” Donoghue said. “I do think people are more aware of the student debt crisis. This is one way to incentivize savings earlier on.”

 

According to AICUM, Vermont introduced a $2,500 tax incentive in 2006 and immediately saw a 34 percent increase in the number of families creating college savings accounts. Apart from New Hampshire, which doesn’t have an income tax, all of the states surrounding Massachusetts offer a college savings tax deduction.

 

“College savings programs have proven to be an essential piece of the college affordability puzzle, and it’s time that Massachusetts catches up with the rest of the country in trying to help families save for their children’s futures,” AICUM President Richard Doherty said in a statement after the bill was endorsed by the Revenue Committee.

 

The college savings tax deduction bill was formerly sponsored by House Ways and Means Committee Chairman Rep. Brian Dempsey, whose panel has custody of the bill’s latest version.

 

House Speaker Robert DeLeo is scheduled Thursday to participate in a forum organized by AICUM for legislators to hear from college students benefiting from need-based college aid funding.

 

It’s the first time the bill has received a favorable Revenue Committee report, and supporters also see it as a way to deliver on the independent recommendations of the Subcommittee on Student Loan and Debt and the Special Commission on Educational Scholarships.

 

Unlike some other legislative committees, the Revenue Committee released a breakdown of how its members voted on the bill. Voting in favor of the legislation were Rodrigues and Sens. James Timilty, Eric Lesser, Ryan Fattman and Reps. Jay Kaufman, Thomas Stanley, Denise Provost, James Dwyer, Alan Silvia, Randy Hunt and Shawn Dooley

 

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AICUM Members Give Back to Veterans and their Families

Happy Veterans Day!

 

As we honor the men and women who have selflessly served our country, it’s important to recognize the important role of colleges and universities when it comes to serving veterans, active service-members and their families. AICUM is proud of the efforts so many of our members have undertaken to do their part.

 

Today, Northeastern University opened its Center for Advancement of Veterans and Servicemembers, which will offer a wealth of services and benefits to student veterans.  Through the center, veteran students will engage in tailored experiential learning programs and career resources that leverage their unique competencies and military experiences.  At the same time, veteran students will be exposed to mentorship opportunities and provided assistance as they transition to civilian life.

 

This month, Endicott College launched the VITAL partnership, recognizing that veterans face unique challenges in transitioning from service-member to student. Through this program, students receive counseling, mentors and tutors, and support with time management, organization, study skills and more. They are also enrolled in the Bedford Veterans Affairs Medical Center and offered assistance with obtaining veterans’ benefits and vocational rehabilitation.

 

Also launched this fall at Gordon College’s Children of Fallen Patriots scholarship offered to children who have lost a parent in the line of duty. Connecting with military families is also a top goal at Wheelock College, which established the Wheelock Center of Excellence for Military Children and Families in collaboration with the Massachusetts National Guard and the Military Child Education Coalition® to connect military families with available resources. The college is also in its second year of offering a certificate in military counseling.

 

The Emerson College community is out and about in Boston on Veterans Day, lending a helping hand as part of its Emerson Action Day. From 8:00 a.m. to 4:00 p.m., staff, faculty and students are volunteering at a number of sites including the Haley House, Citizen Schools and ReVision Urban Farm, among others.

 

These are only a few of the impressive efforts launched by our members across Massachusetts. We are proud of the commitment these institutions have shown to not only helping their communities, but helping those who have served our country.

 

Happy Veterans Day from AICUM and its members, and thank you for your service! 

 

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11th Annual AICUM Dinner

Please join us for the 11th Annual AICUM Dinner!

 

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This year we are celebrating the success of our graduates and the contributions of our colleges and universities to the innovation economy in the Commonwealth.

 

Monday, December 14, 2015

Reception: 5:30pm

Dinner and Program: 7:00pm

Location: Seaport Hotel, Boston

 

AICUM Committed to Action Award
The Honorable Katherine Clark
United States House of Representatives

 

AICUM Committed to Access Award
The Honorable Brian S. Dempsey
Massachusetts House of Representatives

 

For more information including ticket sales and Sponsorship opportunities, please contact Kaitlyn Rodriguez, Vice President of Administration and Member Relations at 617-742-5147 ext. 4 or at Kaitlyn.Rodriguez@aicum.org

 

We very much look forward to and appreciate your participation in what promises to be an exciting and memorable evening.

 

Sponsorship Options: Click here.

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AICUM October Facts of the Month

Lowest Default Rate in the Nation

Did You Know?

Massachusetts has the lowest student loan default rate in the country at 6.4%.

 

AICUM colleges and universities lead the way with a student loan default rate of 3.74%.

 

Massachusetts Student Loan Default Rates by Sector

Default Rates

Source: United States Department of Education; 2012 Cohort Default Rates; released 9/30/2015

Did You Know?

  • In FY15, AICUM colleges awarded over $560 million in institutional grants and scholarships to Massachusetts residents.  This need-based aid allows students to borrow less, resulting in more manageable repayment upon graduation.
  • AICUM members are committed to helping students and alumni manage their debt.  Many campuses employ programs like SALT, offered by American Student Assistance, to provide free guidance and counseling to student and alumni on loan management.
  • Massachusetts private colleges lead the nation in graduating students on-time (68.3 percent graduate within 4 years).  This reduces the total cost to students and allows them to enter the workforce faster.
  • New England places a tremendous value on a college degree.  AICUM graduates are able to find good paying jobs quickly upon graduation, which enables them to manage their debt payments more easily.

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AICUM September Facts of the Month

Enrollment

Did You Know?
Massachusetts is the only state in the nation where more students are enrolled at independent institutions of higher education than public institutions 

Enrollment by Sector: Fall 2014

 Enrollment by sectorSource: The Integrated Postsecondary Education Data System

Did You Know? 1 out of 2 Massachusetts high school graduates attending a 4-year college in Massachusetts do so at an independent college

 

First-Time Freshmen 2004-2012

Private

Public

2012

12,296

12,922

2010

12,591

12,292

2008

13,070

12,744

2006

12,610

12,145

2004

8,668

10,798

 

Source: Postsecondary Education Opportunity

 

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AICUM Urges Legislature to Support 529 College Savings Plans

Earlier today, AICUM President Richard Doherty testified in front of the state’s Joint Committee on Revenue about helping families save for college.

 

Families across the Commonwealth can relate to the difficulty of trying to save for your child’s college education in the midst of making ends meet on rent or a mortgage, food, activities for your children and other expenses.

 

In addition to the 529 College Savings Plans offered on the federal level, most income tax states also offer state level tax incentives to help families save for college. It’s time for Massachusetts – a leader in higher learning – to do the same.

 

AICUM applauds the lawmakers who have sponsored or co-sponsored legislation that would give the hardworking families of our state a tax break on college savings plans. We all know that college is what puts young people on the road to higher earnings and future success – and studies have shown that having any college savings makes a student more likely to attend a four-year college.

 

Read our testimony on this issue and my recent op-ed in The Herald News for more details. We look forward to continuing a discussion on this important college savings tool, and we are hopeful that this discussion leads to action for Massachusetts families.

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AICUM Featured on NECN’s DC Dialogue

AICUM President Richard Doherty joined NECN’s DC Dialogue hosts Eileen Curran and New England Council President Jim Brett last week to discuss higher education in New England and related issues before the current Congress and Administration.  Among the topics discussed, Rich provided comment on President Obama’s proposed college ratings plan, the upcoming Higher Education Act reauthorization, financial aid and student loans, higher education tax incentives, and the potential role for colleges and universities in Boston 2024.

 

Check out the video below and let us know your thoughts on the issues!


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Boston Globe hosts PR Professionals for “AICUM FYI” Session

October 23, 2014

 

HighRes_120403_ONeill_BradleyFreeman-0037 By Brad Freeman, Director of Public Policy & Advocacy

 

Massachusetts is home to many of the world’s leading colleges and universities and higher education is a vital component to the state’s economy.  As such, on almost a daily basis, one or more local news outlets carries a story on higher education trends or initiatives on local campuses.  As a result, a key role of the communications office on campus is developing a relationship with higher education desks at local media outlets to help foster inclusion in these stories.

 

To help facilitate these relationships, AICUM frequently partners with local media outlets to host an “FYI” session where public relations professionals from our colleges can network with editors and reporters, while also learning more about the media outlet’s higher education coverage and story selection processes.  This invaluable information helps communications offices better hone their story pitches to the higher education desk while dovetailing their messages with the interests of the reporter.

 

Yesterday we hosted an “FYI” with the Boston Globe’s Assistant Metro Editor Roy Greene and higher education reporter Matt Rocheleau.  We were joined by over 40 professionals representing more than 25 of our college and university members.  Roy and Matt opened the “FYI” by offering some insight into the trend stories in higher education that the Globe has focused on this year, which include college affordability, issues related to sexual assault on campus, the emergence of MOOC’s and challenges within higher education.  In addition to covering industry trends, the Globe has a committed interest to covering human interest stories on campus.  As examples, Roy cited recent human interest stories featuring Simmons College and Clark University as successful pitches to the Globe’s higher education desk.

Following their overview, Roy and Matt took questions from attendees and poised some question of their own regarding what trends are percolating on campuses.  This back and forth provided attendees the opportunity to pitch newly-developing trend stories, including the increasing international student presence on campus, implications of the proposed federal ratings system and upcoming research on the Millennial generation.  We look forward to reading about them in a future Globe edition!

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Higher Ed Roundtable with Senator Stan Rosenberg

October 17, 2014

 

 

 

By Richard Doherty, AICUM President

 

 

Earlier this week, AICUM held a Presidents’ Only meeting at Emmanuel College, where we were joined by 25 presidents, along with senior staff representing presidents unable to attend. We were also joined by Senator Stan Rosenberg (D-Amherst), who is expected to assume the mantle as President of the Senate in January, following the retirement of current Senate President Therese Murray. Senator Rosenberg has long been a strong advocate for higher education and we were pleased that he agreed to join us for 90 minutes to discuss the many critical roles that higher education plays in the state and to explore new ways for our colleges and universities to be of greater assistance to the Legislature and the Commonwealth.

 

Senator Rosenberg started the discussion by speaking to the indispensable role that institutions of higher education – both public and private – have in the Massachusetts economy. The Senator rightly pointed out that the higher education industry is one of the top four leading industries in Massachusetts (along with health care, financial services, and the life sciences) and directly contributes to the other leading industries, as they are all knowledge-based and thus dependent on an educated workforce.

 

When discussing the issues of college costs and affordability, Senator Rosenberg said he is committed to working with colleges and universities to explore creative solutions to maintaining affordability and reducing student debt. Building on the work of the Subcommittee on Student Loans and Debt this past legislative session, Senator Rosenberg expects that an omnibus higher education legislative bill will be filed implementing many of the recommendations, including an increase in need-based aid, creating a college savings incentive program, and targeted loan forgiveness. Senator Rosenberg also spoke passionately about the importance of lowering interest rates on student loans, comparing the current high rate paid by students to the much lower rate one receives when purchasing a car or home. He urged the presidents to work with him to develop a creative solution to lowering the rates currently offered.

 

Finally, Senator Rosenberg challenged colleges and universities to share the expertise of their faculty, staff and students, and, where appropriate, to partner with the Legislature to help solve some of the bigger problems facing the Commonwealth. As examples, Senator Rosenberg suggested that colleges and universities might be able to provide guidance and expertise to help find more efficient ways for the state to develop and implement large scale IT projects; to complete public construction projects (both vertical – i.e. bricks and mortar – and horizontal – i.e. roads and bridges), and; to rethink how the state can prevent incarceration and reduce recidivism rates.

 

Following the presentation of the challenges, our presidents had a number of suggestions of ways our colleges could contribute to solutions in the next legislative session. AICUM will be convening task forces consisting of experts from our colleges and universities to help address these and other challenges.

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