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      Princeton Faces 21 Percent Tax on its Endowment Income

      By Princetonians for Free Speech

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      The Target on Princeton's Back has Grown Bigger

      A PFS Editorial

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      Stuart Taylor Jr: Trump Challenges Princeton on Race and Free Speech

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      Princeton Free Speech News & Commentary

      Princeton Faces 21 Percent Tax on its Endowment Income

      May 15, 2025 4 min read 9 Comments

      Princetonians for Free Speech

      Since the beginning of the year, Princetonians for Free Speech has been warning that Princeton and other universities were likely to be hit with a big increase in the current 1.4 % tax on endowment income. Now it is happening.

      In the early hours of yesterday morning, the House Ways & Means Committee voted to report out its part of the Reconciliation bill – a.k.a. the “One Big Beautiful Bill.” This massive bill contains numerous tax provisions, including a large increase in the tax rate, now 1.4%, on endowment income. The bill creates a tiered tax rate based on an institution’s “student-adjusted” endowment. There are four rates: 1.4%, 7%, 14%, and 21%. The 21% rate applies to schools with an endowment of at least $2 million per student. It is the same as the corporate tax rate. Princeton qualifies for the 21%. According to one article, others qualifying for the highest rate are Harvard, Yale, Stanford, and MIT. Here is a list of the largest endowments. Princeton is listed at $34 billion. Note that Texas, which has a large endowment, is not covered by the endowment tax because it is a public university.

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      As endowment tax looms, Princeton asks departments to make plans for ‘permanent’ budget cuts, warns of potential layoffs

      May 13, 2025 1 min read

      Christopher Bao and Annie Rupertus 
      Daily Princetonian

      Excerpt: Princeton asked all departments and University units to prepare “separate plans for 5 percent and 10 percent permanent budget cuts to be phased in over the next three years, with some actions to start later this summer” in an email sent to faculty and staff on Monday afternoon — the University’s most dramatic budgetary guidance yet following a tumultuous semester for higher education.

      The email, sent by Provost Jennifer Rexford and Executive Vice President Katie Callow-Wright, explicitly acknowledged the potential for layoffs to be part of budget reductions. “Cuts of this magnitude to our budget cannot be achieved without changes to some operations and the associated elimination of some staff positions,” they wrote.

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      New Campaign Calls on Alumni to ‘Stand Up’ for Princeton, Higher Ed

      May 09, 2025 1 min read 4 Comments

      David Montgomery ‘83
      Princeton Alumni Weekly

      Excerpt: For the first time in memory, Princeton is inviting alumni, faculty, students, and allies to lend their voices to a broad campaign of political advocacy and public affirmation in response to the Trump administration’s unprecedented attacks on research funding and academic freedom in American higher education. “To my knowledge, this is a new kind of initiative for the University,” President Christopher Eisgruber ’83 told PAW in an early May interview about the campaign, which is called “Stand Up for Princeton and Higher Education.”

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      National Free Speech News & Commentary

      NYU Denies Diploma to Student Who Criticized Israel in Commencement Speech

      May 15, 2025 1 min read 1 Comment

      Jake Offenhartz
      Associated Press

      Excerpt: New York University said it would deny a diploma to a student who used a graduation speech to condemn Israel’s attacks on Palestinians and what he described as U.S. “complicity in this genocide.”

      Logan Rozos’s speech Wednesday for graduating students of NYU’s Gallatin School sparked waves of condemnation from pro-Israel groups, who demanded the university take aggressive disciplinary action against him.

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      More than 1,000 US students punished over speech since 2020, report finds

      May 15, 2025 1 min read

      Alice Speri
      The Guardian

      Excerpt: Parker Hovis was four courses away from getting his computer science degree from the University of Florida when he was arrested along with several other students at a pro-Palestinian protest on campus last spring. While the charges against him were dismissed and a school conduct committee recommended only minor punishment – a form of probation – the university administration suspended him for three years. He’ll be required to reapply if he wants to come back after that.

      Hovis, who has since left Florida and is working to pay off his student loans despite never graduating, is one of more than 1,000 students or student groups that were targeted by their universities for punishment between 2020 and 2024 over their speech, according to a report published today by the Foundation for Individual Rights and Expression (Fire). About 63% of them were ultimately punished.

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      How House Lawmakers Could Reshape Higher Ed

      May 15, 2025 1 min read

      Jessica Blake
      Inside Higher Ed

      Excerpt: All the pieces of House Republicans’ plan to cut trillions in federal spending are now public, and if the package becomes law, colleges and universities could face crippling repercussions, higher education experts say.

      “It is a full-out assault on the ability of students—especially low-income students—to access and afford higher education,” said Jon Fansmith, senior vice president for government relations and national engagement at the American Council on Education. “It will have a dramatically negative impact, not just on higher ed, but on the whole population.”

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      Newsletter Archive

      April 2025 Newsletter

      April 2025 Newsletter

      May 05, 2025 5 min read

      To PFS subscribers, members and friends,

      April saw a major campus protest, one that disrupted and cut short an April 7 event featuring former Israeli Prime-Minister Nefthali Bennett. This disruption was by far the worst we have seen on Princeton’s campus. In response,PFS issued two letters to President Eisgruber and the administration. The first letter was sent on April 9 in the immediate aftermath of the event. It makes specific recommendations for swift action to sanction those responsible for breaking university rules. Anticipating a possible recurrence at an April 22 event with Yechiel Leiter, the new Israeli Ambassador to the US, PFS sent the second letter on April 18, outlining measures not taken at the first event, that are critical to preventing more disruption.

      March 2025 Newsletter

      March 2025 Newsletter

      March 28, 2025 6 min read

      To PFS Subscribers, Members and Friends, 

      On March 10 the Department of Education’s office of Civil Rights sent letters to 60 universities, including Princeton. Theseletters warned of potential “enforcement actions” if institutions do not protect Jewish students. 

      On March 20, in reaction to the Trump administration’s threat to cut $400 million in Federal funding from Columbia University, 18 law professors with a range of views from liberal to conservative, signed a public letter in The New York Review arguing: “the government may not threaten funding cuts as a tool to pressure recipients into suppressing First Amendment-protected speech.”  The next day, Columbia conceded to government demands. Other thanBrown University’s President Christina Paxson, who detailed what Brown would do under similar threats, Princeton’s President Eisgruber was a lone voice amongst the leadership of these universities – in The Cost of Government Attacks on Columbia, published by the Atlantic on March 19.

      This week in The Chronicle of Higher Education, three of the 18 public letter signatories, all first amendment scholars, discuss what Columbia and other universities threatened with funding cuts should do. It is worth reading “It is Remarkable How Quickly the Chill Has Descended.” with Michael C. Dorf, of Cornell University; Genevieve Lakier, of the University of Chicago; and Nadine Strossen, of New York Law School.


      Princeton FIRE Rankings
      Princeton Flops in FIRE Free Speech Rankings

      223 out of 251. A “red light” institution has at least one red light policy that both clearly and substantially restricts freedom of speech.

      GET FULL REPORT

      Princetonians for Free Speech

      PFS fights for free speech alongside Princeton alumni, staff and students. Princetonians for Free Speech is a 501(c)(3) nonprofit registered in the US under EIN: 85-3710034. Donations are tax deductible to the fullest extent allowable under the law.

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