Mr. MCCAIN. Mr. President, I am proud to have become a cosponsor of S1724, the Higher Education Reporting Relief Act. As many of my colleagues know, this bill would repeal the reporting requirements imposed on colleges and universities when Congress enacted the HOPE scholarships and the Lifetime Learning Tax credit last year.
The Taxpayer Relief Act of 1997 contained many important provisions for American families, particularly in the area of education. As a part of this bill, Congress created several new initiatives to make college and higher education more affordable for students throughout our country. The Hope and Opportunity for Postsecondary Education (HOPE) scholarship provides students with a 100% tax credit for up to $1,000 of their tuition costs for higher education and a 50% credit for the next $1,000 spent on their tuition. This credit can be claimed by the student, their spouse, or parents if they are still a dependent. Another program created by Congress to ease the financial burden of higher education for our working families is the Lifetime Learning Tax Credit.
Both of these programs are helping make college and postsecondary education more affordable. Unfortunately, when Congress created these new education programs, we inadvertently levied very costly and burdensome reporting requirements on our educational institutions. Beginning in the 1998 tax year, schools are required to compile and issue annual reports on their students for the Internal Revenue Services. Under the new law, schools are now responsible for providing detailed information on all their students, including name, address, Social Security number, attendance records, academic information, tuition data, along with the amount of qualified student aid.
Preliminary studies indicate that the cost to our nation's universities and colleges to comply with the new reporting requirements will range from $125 million to $150 million for just the first year. The three colleges in my home state of Arizona expect that this new requirement will cost them approximately $400,000 to begin the reporting system, which will turn into an annual expense of $200,000 for each of the institutions.
This reporting requirement is costly and counterproductive. At a time when Congress and the Federal government are trying to make college affordable, contain costs, and make higher education more accessible to millions of students, we are subjecting schools to excessive and unnecessary reporting requirements. According to the Commission on the Cost of Higher Education, a primary factor contributing to escalating tuition costs is excessive government regulation and reporting requirements.
This is why I am cosponsoring Senator COLLINS' bill, the Higher Education Reporting Relief Act, which repeals the requirement for schools to report personal information on their students to the IRS. Instead, the new HOPE scholarships and Lifetime Learning Tax Credit will be treated like all other existing tax credits. The individual taxpayer will be responsible for providing the IRS with the pertinent information on their tax returns and maintaining appropriate records to substantiate their claims.
This important piece of legislation prevents the limited resources of our colleges and universities from being wasted on unneccesary administrative costs and allows them to focus on our students and their education.
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