Wesleyan University President Criticizes Proposal to Revoke Tax-Exempt Status

Wesleyan University President Michael Roth expressed strong criticism of the Trump administration’s proposal to revoke tax-exempt status from private educational institutions that offer benefits based on race. Roth stated that the university does not plan to alter its current programs in response to this potential policy change.

According to Roth, the proposal aims to pressure schools into removing programs that support students of color. He emphasized that this use of the IRS to advance the administration’s ideology represents an extraordinary level of overreach.

The administration’s proposal frames programs that consider race as discriminatory, though they aim to promote diversity or address historical discrimination. It suggests that programs could instead utilize race-neutral factors such as income or first-generation college status.

There remains legal uncertainty regarding whether the IRS has the authority to redefine racial discrimination and consequently revoke tax-exempt status. This legal ambiguity could lead to challenges that delay or prevent the proposal’s implementation.

Roth clarified that Wesleyan University does not run programs restricted by race. However, it supports first-generation and low-income students, a group that includes many students of color at the university in Connecticut. The potential loss of tax-exempt status could have dire financial ramifications for Wesleyan.

He noted that some institutions may proactively alter or eliminate programs to avoid future legal battles and their associated costs. Roth described this as ‘anticipatory compliance,’ where schools change programs to avoid expensive legal conflicts.

The Treasury Department and the IRS speculate that up to 18,000 private educational institutions could be impacted by this proposal. If the rule is finalized, it would not come into effect until May 2027.