Grinnell Provides Details to Congress on How Endowment Supports College Affordability

In February 2016, Grinnell College, along with 50+ other colleges and universities with $1 billion or larger endowments, received a letter signed by three members of Congress:

• Sen. Orrin Hatch (R-Utah), chairman of the Senate Committee on Finance
• Rep. Kevin Brady (R-Texas), chairman of the House Committee on Ways and Means
• Peter Roskam (R-Ill.), chairman of the House Committee on Ways and Means Oversight Subcommittee

The Congressmen wrote, “we are conducting an inquiry into the activities of colleges and universities related to the numerous tax preferences they enjoy under the Internal Revenue Code.” They asked several questions about Grinnell’s endowment, which the College answered thoroughly in its response letter (pdf). Their concerns seem to be based on the size and growth of endowments, increasing tuition at these wealthier schools, and whether they are using their endowments to help needy students attend.

Members of Congress have discussed legislation that would require colleges with endowments larger than $1 billion to spend 25 percent of the annual payouts on financial aid. About 40 percent of Grinnell’s annual endowment payout goes toward student financial aid.

Thanks to the stewardship efforts of many people over the years, such as Joe Rosenfield ’25, Grinnell’s endowment has grown substantially, enabling the College to provide many students with an excellent education. The College is positioning itself to continue providing such opportunities for future students.