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Ways and Means Committee Takes Action to Protect Jewish Students, Help Parents Save for Their Child’s Education, and Stand Up to China

July 09, 2024

WASHINGTON, D.C. – Today, the Ways and Means Committee advanced legislation that holds colleges and universities accountable for failing to protect student civil rights, including combating the rampant discrimination experienced by Jewish students this past school year. Similarly, the Committee approved a policy to update the calculation of the endowment tax formula to align the tax code’s treatment of students on college campuses with the Higher Education Act. The legislation follows a months-long Committee investigation into the explosion of antisemitism at some of the nations’ most prestigious universities that found:

  • Weak university leadership has failed to protect students, enforce campus policies, and discipline students and faculty who violate such policies or rules;
  • Radical faculty have emboldened students to take part in antisemitic activity and have themselves flouted campus policies; and
  • Opaque foreign influence, including some international students and faculty, have helped fuel discriminatory activity on campus. 

The Committee also approved a bill allowing 529 accounts to cover K-12 educational expenses and workforce expenses for career or technical training as well as a Congressional Review Act resolution to void a Biden Administration regulation that allows the Chinese Communist Party to benefit from U.S. tax dollars for manufacturing electric vehicles and their components. 

Click here to watch Chairman Smith’s opening statement.

In his opening statementWays and Means Committee Chairman Jason Smith (MO-08) highlighted the need to impose meaningful consequences on universities that refuse to take action against the wave of antisemitism on campus:

“Legislation before us today will impose real, financial consequences on universities that continue to turn a blind eye to antisemitism while allowing a small fringe to rule their campuses.

“At a previous hearing, a Jewish student testified that the only meaningful change on campus came as a result of House Republicans’ investigation. We need to ensure these universities step up and start protecting Jewish students in compliance with federal law.”

Chairman Smith also noted that legislation expanding 529 accounts helps parents to save for their child’s education and supports students who want to learn a trade or skill instead of earning a four-year degree:

“Our Committee has focused on ways to improve K-12 and postsecondary education in other ways as well. In October, parents and leaders shared powerful testimony about how their lives changed when they had access to more avenues to get a quality education and workforce opportunities. The message was clear: parents want to be able to give their children a better education and more opportunities for a better future…A four-year degree isn’t right for everyone. Americans who want to learn a trade or skill deserve the same shot at their dreams. That’s why this bill covers tuition, fees, books, and other costs related to technical training.”

Speaking on the Congressional Review Act resolution blocking the Biden Administration’s pro-China, anti-taxpayer regulation, the Chairman noted the consequences were President Biden to veto the legislation:

“If President Biden vetoes this CRA, he is leaving the door wide open to making the American taxpayer China’s piggy bank.”

The University Accountability Act (H.R. 8914)

Introduced by Rep. Nicole Malliotakis (R-NY), the bill levies new financial penalties on colleges found by a federal court to violate student’s civil rights, including discrimination of Jewish students.

  • The bill levies a financial penalty against schools that have a civil judgment entered against them by a federal court for violating a student’s civil rights under Title VI of the Civil Rights Act.
  • Colleges and universities that meet the penalty criteria would be required to pay a fine of either 5 percent of the school’s aggregate administrative compensation as reported on the school’s Form 990 or $100,000, whichever is greater.

Read the one pager here

The bill passed the Committee 24-12.

The Protecting American Students Act (H.R. 8913)
Introduced by Rep. Drew Ferguson (R-GA), the bill incentivizes American colleges and universities to admit more American students. 

  • The bill amends the formula of the Endowment Tax calculation to match the definition used in the Higher Education Act to determine whether a student is eligible for federal financial assistance. 
  • This would not include students who are in the U.S. temporarily or on a student visa.
  • This bill incentivizes universities that receive generous U.S. federal tax benefits to either enroll more American students or spend more of their endowment funds on those students to avoid being subject to the endowment tax.
  • This bill would subject roughly 10 to 12 additional schools to the Endowment Tax, all of which could avoid the tax by admitting more American students or spending down their endowments.   

Read the one pager here.

The bill passed the Committee 24-13. 

The Education and Workforce Freedom Act (H.R. 8915)
Introduced by Rep. Kevin Hern (R-OK), the bill helps parents save for their child’s education and students earn a skilled trade or technical credential or license. 

  • Empowers American families, students, and workers with the ability to choose an education most suited to their needs by allowing tax-exempt distributions from 529 plans to be used for additional educational expenses in connection with attendance at K-12 school (including homeschool).
  • It also allows for 529s to be used to pay for expenses associated with obtaining or maintaining recognized postsecondary credentials and licenses.

Read the one pager here.

The bill passed the Committee 23-13.

Congressional Review Act on EV Tax Credit Regulations (H.J. Res 148)
Introduced by Rep. Carol Miller (R-WV), the bill disapproves of a Biden Treasury Department regulation that allows American taxpayer dollars to flow to Chinese companies manufacturing electric vehicles. 

  • The Biden Treasury Department has finalized lenient rules that allow Chinese billionaires with unofficial ties to the Chinese Communist Party and Chinese battery manufacturers to receive U.S. tax subsidies.
  • Under the final rule released by the Biden Administration, Chinese materials can be used for the manufacturing of electric vehicles and still qualify for the credit directly contradicting the clear language and intent of the law.
  • Under H.J.Res. 148, the Biden Administration’s China favorable EV regulations from the so-called Inflation Reduction Act would be voided, including the new rules promulgated in the final regulations as well as previously proposed regulations.

Read the one pager here.

The bill passed the Committee 25-14. 

Committee Hearings 
The markup builds on several Ways and Means Committee hearings where members heard from Americans directly affected by the issues addressed by each bill.

RECAP: Seven Key Moments from Ways & Means Hearing on Nexus Between Antisemitism, Tax-Exempt Universities, and Terror Financing

RECAP: Six Key Moments: Hearing on Antisemitism on College Campuses

RECAP: Seven Key Moments from Ways and Means Hearing on Educational Freedom and Opportunity

RECAP: Four Key Takeaways from Ways and Means Hearing on the U.S. Tax Code Subsidizing Green Corporate Handouts and the Chinese Communist Party