Over a six-year period, Ivy League schools have received tens of billions in tax dollars, bringing in more money from taxpayers than from undergraduate student tuition. In fact, they received more federal cash than 16 state governments.
The stunning numbers are all part of a new report, first seen by Fox News, released Wednesday by Open the Books -- a non-profit group whose stated mission is to capture and post online all disclosed spending at every level of government.
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The 43-page report shows the massive amount of money flowing into not-for-profit Ivy League schools, including payments and entitlements, costing taxpayers more than $41 billion from fiscal year 2010 to fiscal year 2015.
The spending is controversial because these eight schools -- Brown University, Columbia University, Cornell University, Dartmouth College, Harvard University, the University of Pennsylvania, Princeton University and Yale University -- have enormous resources at their fingertips, including endowment funds (money raised from donors) in 2015 exceeding $119 billion. Take that total and split it up among Ivy League undergrads and it comes out to $2 million each.
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The study says another federal perk -- the schools pay no tax on investment gains on their endowment -- a tax break is estimated at $9.6 billion over the six years of the study.
In a statement, Princeton, suggested the study was flawed because it didn't take into account all the money the college receives and then reinvests. Robert Durkee, a Princeton vice president and secretary, said most of the tax incentives the college receives goes toward libraries, laboratories, classrooms, research and financial aid.
"The tax exemption for endowment earnings allows these institutions to use all of those earnings to support their missions of teaching and research, for this generation and for future generations," Durkee said in a statement. "This means
that the universities spend earnings now, but they also reinvest a portion so they can continue to support their programs of teaching and research well into the future."
Yale said that rather than being a drain on taxpayers -- as the study suggests -- the college is a huge financial boon to the towns that surround it.
"Since 2000, over 50 startups based on Yale inventions and located in New Haven have attracted over $5 billion in investment to New Haven and surrounding towns," Tom Conroy, a Yale spokesman, told Fox News. "Alexion, which employs 1,200 people in New Haven, is a prime example of Yale’s impact."
Conroy also pointed out that Yale funds a large portion of its research.
Some question if these schools should receive any federal funding…much less, such a large amount.
Here’s a reality check list:
- With continued donations at the present rate, the money could provide free tuition to the entire student body in perpetuity,
- Without new donations, the endowment could provide a full-ride scholarship for all Ivy League undergraduate students for 51 years
The report also shows that in fiscal year 2014, the balance sheet for all eight Ivy League schools combined showed accumulated gross assets of more than $194 billion, or the equivalent of $3.35 million per undergraduate student.
“The Ivy League needs to pay its own way…The taxpayer gravy train needs to end,” Adam Andrzejewski, founder of Open the Books, told Fox News.
His report does say that Americans should be proud of the schools and “applaud the many contributions of Ivy League colleges and graduates.” But he told Fox News he feels that “they don’t need taxpayer help, they don’t need taxpayer assistance.”
Some of the federal spending makes sense, like the study of AIDs. But, he said, some are less defensible.
One grant was given to Cornell for nearly $1 million to study whale presence in the Virginia offshore wind energy area. Other grants to Ivy League schools were to study college binge drinking, ethics in Tanzania and sex chromosomes in turtles.
“They have got an endowment, right?” Andrzejewski said. “They can use their endowed funds – they don’t need public funds – to fund studies.”
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He went on to compare what he calls Ivy League, Inc. to “a hedge fund with classes.”
Finally, the report dives into some of the big bucks being paid out to Ivy League employees. It shows more than $62 billion in salaries, benefits and reportable compensation to faculty, staff and other employees from fiscal year 2010 to fiscal year 2014 and names four employees who made more than $20 million and three more who made more than $13 million.
Fox News reached out to every Ivy League school for comment Wednesday morning. Princeton and Yale replied, Dartmouth declined to comment, and the others have not responded.
The entire report can be read here.