Rhode Island 2025 Regular Session

Rhode Island Senate Bill S0778

Introduced
3/14/25  

Caption

Provides a tax upon the endowment of a private institution of higher education equal to two percent (2%) upon each dollar over $1,000,000,000.

Impact

The implementation of S0778 would primarily impact state taxation regulations concerning private higher education institutions. By imposing a tax on large endowments, this bill targets a segment of educational funding that has traditionally enjoyed tax-exempt status. Proponents suggest that this measure could lead to a more equitable funding mechanism for public education, as it aims to redistribute financial resources from wealthy institutions to support local school districts, particularly in enhancing behavioral health services. In turn, this could improve student mental health support mechanisms within the education system.

Summary

Senate Bill S0778 proposes a new taxation mechanism aimed at private institutions of higher education that maintain endowments exceeding one billion dollars. Under this legislation, these institutions would be subjected to a tax of two percent on the dollar amount that exceeds the one billion threshold. The generated revenue from this tax will be specifically allocated to support behavioral health staff within public schools located in the municipalities where these educational institutions are situated. This initiative aims to address the growing mental health needs of students by providing necessary support services in schools.

Contention

While the bill's rationale is linked to improving public school services, it may spark debates surrounding the fairness and effectiveness of taxing endowments. Critics of the legislation may argue that taxing endowments of private institutions could discourage financial contributions from alumni and benefactors, potentially impacting the overall financial health of these institutions. Moreover, questions may arise about the adequacy of the funds generated through this tax and whether they will truly address the needs of public schools effectively. Some stakeholders may also raise concerns about the implications of government intervention in the funding mechanisms of private educational establishments.

Companion Bills

No companion bills found.

Previously Filed As

RI S2564

Provides a tax upon the endowment of a private institution of higher education equal to two percent (2%) upon each dollar over $1,000,000,000.

RI H7546

Provides a tax upon the endowment of a private institution of higher education equal to two percent (2%) upon each dollar over $1,000,000,000.

RI S2747

Allocates, to the cities and towns of the state, a portion of state income taxes for new employees of not-for-profit healthcare institutions and private educational institutions.

RI H7403

Allocates, to the cities and towns of the state, a portion of state income taxes for new employees of not-for-profit healthcare institutions and private educational institutions.

RI S2511

Provides that gift certificates issued by state-chartered institutions of higher education would be exempt from the provisions of the gift certificate statute relating to expiration, escheatment, reissuance and refund.

RI H7509

Provides that gift certificates issued by state-chartered institutions of higher education would be exempt from the provisions of the gift certificate statute relating to expiration, escheatment, reissuance and refund.

RI S2048

Includes municipal detention facility corporations as exempt from taxation, and requires that an amount equal to twenty-seven percent (27%) of all tax that would have been collected if the property was taxable be paid to the municipality annually.

RI H7186

Includes municipal detention facility corporations as exempt from taxation, and requires that an amount equal to twenty-seven percent (27%) of all tax that would have been collected if the property was taxable be paid to the municipality annually.

RI H7308

Mandates arming campus police at public higher educational institutions and includes campus police in the definition of "law enforcement officer" for the purposes of the "Law Enforcement Officers' Bill of Rights."

RI S2597

Provides for an appropriation by the general assembly in the amount of two million dollars ($2,000,000) to the various school districts and municipalities to employ additional social workers.

Similar Bills

No similar bills found.