Republican View – Time to tax the ivory tower 

Editor’s note: The opinions expressed in this column are those of author Zachary Winn and are not representative of the thoughts or opinions of Tompkins Weekly. 

Cornell University, long considered a pillar of academic excellence in Upstate New York, is facing a growing storm of controversies that call into question its public obligations as a tax-exempt institution. As the federal government is alleged to have frozen approximately $1 billion in funding to the university, amid allegations of antisemitism and racial discrimination in admissions, a wider reckoning is due—not just within Cornell’s halls, but in how such elite institutions are allowed to operate largely unaccountable to the public interests they claim to serve.

The federal funding freeze is more than just a bureaucratic reprimand; it is a wake-up call. Cornell, like its Ivy League peers, enjoys tax-exempt status while maintaining a vast endowment that totals billions. Yet, in many ways, the university functions more like a private enterprise than a public-serving nonprofit. This contradiction is perhaps most visible in the financial burdens placed on the host communities that support these institutions. In Cornell’s case, it is estimated that the university has avoided paying over $600 million in property taxes to the City of Ithaca over the past 20 years alone. This staggering figure represents essential revenue that could have supported local infrastructure, schools, housing, and public services—services that Cornell’s own students, faculty, and staff regularly utilize.

It is long past time for change. A growing movement is calling for an increase in the federal tax on university endowments, currently a mere 1.4% on investment income, to 21%. But this effort should go further. A portion of those revenues should be directed back into the municipalities and regions that host these elite institutions. After all, the local taxpayers bear the brunt of the costs while universities reap the benefits.

Moreover, the university’s tax-exempt status must be re-evaluated. This is especially pressing in light of Cornell’s growing financial entanglements with regimes like China and Qatar—nations with well-documented histories of censorship, labor exploitation, and human rights abuses. Harvard University, facing similar scrutiny, has seen the Trump administration direct the Internal Revenue Service to revoke its tax-exempt status. I am hopeful that the administration will follow suit with more universities, including Cornell. Rescinding or significantly curtailing Cornell’s tax-exempt privileges would be a powerful incentive for the university to recommit to meaningful community engagement and fiscal responsibility. It would also level the playing field for local businesses and homeowners who are taxed at full rate while Cornell continues to expand its tax-free footprint.

The case for reform only strengthens when considering Cornell’s internal governance and ethical missteps. The university has come under fire for its use of Diversity, Equity, and Inclusion (DEI) statements in faculty hiring. A report from the Cornell Free Speech Alliance found that DEI statements were used to reject 21% of candidates in a hard science faculty search, raising questions about academic freedom and ideological gatekeeping in fields that are supposed to be driven by merit and empirical rigor.

This isn’t merely a culture war issue. It speaks to a broader failure of governance and transparency within the university. That failure is also on display in a class-action lawsuit naming Cornell among 40 elite universities accused of colluding to overcharge students through financial aid price-fixing. According to the complaint, these schools used formulas that unfairly included non-custodial parents’ assets, increasing net costs for thousands of families by an estimated $6,200 annually. If proven true, these practices represent a profound betrayal of the mission to provide access and affordability in higher education.

Nor does the list of controversies end there. The U.S. Supreme Court has agreed to hear a separate class-action lawsuit accusing Cornell of mismanaging its 403(b) retirement plan. Plaintiffs claim the university failed to monitor investment fees and options, a dereliction of its fiduciary duties under federal law. Such negligence not only affects current and former employees, but also further erodes public trust in the institution’s financial stewardship.

Cornell’s defenders may argue that the university brings cultural and economic benefits to the region—and it does. But those benefits cannot justify a system that allows an elite, multi-billion-dollar institution to evade its fiscal responsibilities while operating under the guise of public good. In truth, it is the residents of Ithaca and Tompkins County who are subsidizing Cornell, not the other way around. What is meant to be a mutually beneficial, symbiotic arrangement is in reality a parasitic one. Cornell is a tick that is bigger than the dog.

It’s time to flip the script. Increasing the endowment tax and redirecting a portion of those funds back to host communities is not just fair—it’s necessary. If Cornell wants to continue enjoying the privileges of tax exemption, it must be held to higher standards of transparency, ethics, and accountability. Otherwise, the university will remain less a beacon of knowledge and more a monument to inequality and impunity.