House GOP turns up heat on universities suspected of gouging students with tuition rates

The House Judiciary Committee is subpoenaing the University of Pennsylvania (UPenn) and Brown University over their apparent failure to hand over records related to a suspected scheme to price-gouge students.

The letters sent to the universities on Tuesday say the schools appear to be “collectively raising tuition prices” in violation of antitrust laws in order to keep prices high for the universities’ benefit. The committee is requesting documents pertaining to UPenn and Brown’s tuition pricing practices and any potential communications with other Ivy League universities.

The committee opened an investigation into all Ivy League universities in April over their suspected effort to coordinate tuition prices to maximize their profits. A similar subpoena was sent to Harvard on June 26.

“We are particularly concerned that Ivy League member institutions appear to collectively raise tuition prices while engaging in price discrimination by offering selective financial aid packages to maximize profit,” House and Senate committee leaders said in a joint statement in April. “These institutions establish the industry standard for tuition pricing, creating an umbrella effect for all colleges and universities to justify higher tuition costs than they could otherwise charge in a competitive market.”

Brown and UPenn have allegedly “failed to fully comply with the Committee’s investigation,” according to the Judiciary Committee. The universities have until July 22 to comply with the subpoena.

A spokesman for UPenn told the Daily Caller News Foundation the school has “consistently cooperated with the committees’ investigation” and will continue to, adding that the Tuesday subpoena “was unnecessary given our voluntary compliance.”

“As we respond, we are demonstrating that Brown has and continues to make decisions on tuition and financial aid independently as part of our commitment to making sure that no student’s family socioeconomic circumstances prevent them from accessing the benefits of a Brown education,” the spokesman continued.

Brown did not respond to the DCNF’s request for comment.

The committee is also alleging that the schools appear to be “engaging in perfect price discrimination by offering selective financial aid packages to maximize profits,” the letters show.

Tuition costs at many universities, especially wealthy so-called elite institutions, have been rising dramatically for years. At the same time, many of these schools sit on multi-billion-dollar endowments.

Despite this, schools like Cornell have shifted blame to the Trump administration’s federal funding threats to justify price hikes, ignoring that universities have failed to comply with civil rights laws. Cornell’s 4% tuition increase will leave out-of-state students paying $71,266 and in-state students paying $48,010 in the next academic year.

Outside of raising tuition on students, universities like Harvard and the Massachusetts Institute of Technology (MIT) also use their tax-exempt status to limit the size of payouts from expensive lawsuits, all while clinging to billion-dollar endowments.

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