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Legislative Democrats Looking To Dive Into Gonzalez's Endowment Tax Plan

Gubernatorial candidate Jay Gonzalez announces his plan to tax college endowments.
Gubernatorial candidate Jay Gonzalez announces his plan to tax college endowments in Cambridge Wednesday.
Mike Deehan/WGBH News

Beacon Hill leaders were diplomatic in their responses to a proposal from their party's candidate for governor calling for a 1.6 percent tax on the state's richest private college endowments.

Both House Speaker Robert DeLeo and Senate President Karen Spilka, who control the Democratic supermajority gubernatorial nominee Jay Gonzalez would ask to levy the tax, say they're looking forward to reviewing the details of the plan.

If voters put Gonzalez in the corner office next year, the new governor will come with something of a mandate to tax the state's richest universities, which his campaign says would amount to $1 billion to spend on transportation projects and public education services.

Spilka commended Gonzalez for floating the plan and asking how the state can fund world-class education and transportation systems with the least impact on residents' tax burdens.

"Any proposal of this nature requires a close look at all the potential impacts, particularly on our higher education institutions," Spilka wrote in a statement.

DeLeo's office said the Speaker also looks forward to reviewing the plan when more details are available.

Gonzalez's opponent, Gov. Charlie Baker, says the plan would harm colleges' ability to invest in research and students, a sentiment shared by U.S. Senators Elizabeth Warren and Ed Markey when President Trump proposed a similar tax last year.

"The vast majority of the money that is used in endowments supports scholarships and financial aid, most of the time, for low-income and middle-income students," Baker told reporters Wednesday.

"When President Trump proposed this idea, I thought it was a bad idea then, and I still think it's a bad idea," Baker added.

Both Warren's and Markey's offices did not respond to questions about if they oppose Gonzalez's state tax.

The Legislature is usually averse to new taxes, but some lawmakers are looking for ways to raise revenue, especially after the failure of a proposed surtax on ultra-high incomes to make it to this year's ballot.

"I think a lot of my colleagues and certainly myself are looking at how do we make these investments in transportation and education and I do think looking at these one billion dollar-plus college endowments is a reasonable place to look," Sen. Jamie Eldridge told WGBH News Wednesday.

Sen. Anne Gobi has filed similar legislation to Gonzalez's plan to try to coax Harvard - and its $36 billion dollar endowment - to support communities the university holds property in, like the town of Petersham

"Specifically for areas where they have not given back to the communities, I think that's a big part of it...That 36 billion, that's probably - that's larger than most countries have," Gobi said.

A WGBH poll found 50 percent of residents oppose taxing college endowments.

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