Linking Tax Credits to Service

WASHINGTON -- College leaders just about uniformly endorse the idea of community service by students. And college leaders just about uniformly endorse the idea of tax breaks to help pay for college. But combine those two concepts? Higher education isn't excited about that idea.

May 7, 2010
 

WASHINGTON -- College leaders just about uniformly endorse the idea of community service by students. And college leaders just about uniformly endorse the idea of tax breaks to help pay for college. But combine those two concepts? Higher education isn't excited about that idea.

During his campaign for president, Barack Obama did like it, and proposed that some service requirements accompany new tax breaks. But last year's stimulus legislation, which created some additional tax breaks, didn't require service. Instead it required the U.S. Departments of Education and Treasury to conduct a study of the idea. While there have not been signs that the Obama administration is actively pursuing legislation, the two Cabinet departments have formally requested that anyone concerned about the issue respond to a series of questions:

  • "Should students be required to fulfill a community service requirement for receipt of an education credit?"
  • "If there were a community service requirement, should the institutions providing post-secondary education and training (hereafter, colleges) be required to administer it?"
  • If colleges had to oversee such requirements, how would they "ensure that there are meaningful community service opportunities available for all students?"
  • And if colleges had to oversee the requirements, how would they "ensure that eligible students are identified and able to claim the credit while students who failed to fulfill the community service requirement are not able to claim the credit?"

In a letter of response, Molly Corbett Broad, president of the American Council on Education and writing on behalf of 20 other higher education groups, praised community service, but criticized the concept of requiring it to qualify for tax credits.

Broad took care to stress higher education's commitment to service. She noted federal estimates that 6.7 million students volunteered in 2008, up from 4.2 million in 2000. And she said that the "growth in volunteering and service-learning on college campuses is no accident. It reflects a deliberate and sustained effort by higher education because we believe in its merits for students, our institutions, and the world in which we live."

But she then outlined both philosophical and practical reasons to avoid any linkage.

She noted, for example, that "contrary to popular images of undergraduates, part-time, older and lower-income students make up a large proportion of today’s college students," and that many of these students have work or family obligations that make it difficult for them to participate in community service. "Working students, particularly those with families, have very little free time. Requiring community service to access federal student benefits would therefore force some to choose between work and volunteer activities," Broad wrote. "Given that nearly one out of four colleges students who drop out do so due to financial reasons, it is unlikely that students will sacrifice work hours in exchange for community service hours."

Further, she said that creating the requirement for the tax credits would effectively be creating a requirement for everyone but wealthy students, who wouldn't need to worry about using the tax breaks.

Broad also raised a series of practical issues, noting that many experts have said that education tax credits need to be simplified, not made more complicated, and that colleges lack the infrastructure to provide service opportunities for all students and to certify participation. She noted, for example, that many students volunteers through off-campus organizations that are not controlled or overseen by colleges and universities.

Summing up her opposition to linking tax breaks for education with community service, she said: "We believe that combining these two individually worthy policy objectives would yield a result that is decidedly less than the sum of its parts."

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