Eagle's Eye Newspaper

Let’s face it – college is a stressful topic that many high schoolers are hesitant to talk about. Students who choose to go to college may look forward to this new stage in their life, yet the process can be complicated and confusing. Moreover, proposed changes to federal policy are going to make college an even bigger question mark in students’ lives. Some of these changes include taxes on endowments and reductions to funding of university programs. Many of these issues are highly contentious, and the potential effects are still being weighed. It’s essential to establish a baseline of what these changes are.

Endowments are an important source of revenue for private colleges and universities, being used to pay for various purposes like teaching, scholarships, and research. Endowments are typically made through charitable donations. Most are in the form of assets such as investments that provide returns for the school. On January 15, 2025, Representative Nehls (R-TX) introduced the Endowment Tax Fairness Act. This bill would increase taxes on endowments of certain private colleges and universities from 1.4% to 21%. The bill would apply to colleges with 500+ students and endowments of at least $500,000 per student. Representative Mike Lawler (R-NY) introduced a similar bill that would increase the endowment tax to 10% and expand the number of applicable schools. Advocates claim this bill could provide revenue to relieve national debt and hold universities accountable for using endowments for students, while opponents state this bill will limit funds for university operations and student resources.

In Illinois, USAID provides funding to research programs at universities, including Northwestern University and the University of Illinois at Urbana-Champaign. Northwestern receives funding for innovative agribusiness approaches while UIUC receives funding to manage the Institute for Prevention of Postharvest Loss. Because the Trump Administration is moving to terminate USAID, these universities will lose access to funds for these research programs. Peter Goldsmith, a professor at UIUC, described how the Soybean Innovation Lab at UIUC has been closed and 30 staff members have been let go because of USAID’s downscaling. The SIL helped American farmers “expand their markets and U.S. standards globally.” The Trump Administration’s cuts at NIH will have a similar effect since NIH provides grants to research institutions across the country for maintaining facilities, providing supplies, and paying staff. Many of these institutions are based at universities, allowing college students to gain experience and work to improve healthcare. An impact of this could be seen at the University of Illinois Chicago. UIC projects to lose $47 million in funding due to a new 15% cap on grants from NIH. This will limit programs that, “among other things, … [have] produced promising new therapeutics, including a novel antibiotic to fight drug-resistant bacteria and a redesigned drug for acute lymphoblastic leukemia.” 

For students, these policy changes will impact the cost of college and the ability to access opportunities and resources. Limits to research programs will have a larger societal effect by limiting critical products from research programs that advance American ways of life across multiple industries. Unfortunately, I made multiple interview requests to Illinois politicians and professors, but have received little feedback. This is an actively developing topic that sees new folds every day, so this article may be revisited in a future Eagle’s Eye Edition.