Why don't Universities, Colleges, and private K-12 schools rely and tax-deductible "suggested donations" instead of taxable tuition?
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Many private education institutions already qualify as non-profits and regularly recieve tax-deductible donations in addition to tuition. A fully tax-deductible model would make private education considerably more affordable for many families and this increase in discretionary income would allow education institutions to solicit increased supplementary donations. As I understand, private schools always reserve the right to expel any student at any time for any reason, so "free riding" (by individuals not on financial aid) would not be a problem. I know many private clubs, organizations and even businesses legally sustain themselves through suggested donations so I'm not sure why education couldn't work this way.
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Answer:
Private schools currently get their funding from both tuition and donations. A recent New York Times Op-Ed says that for private day schools, tuition covers 70-80% of the costs. At boarding schools, tuition can cover as little as 50% of costs. The rest is covered by donations. The problem with relying on donations is that people won't give enough. If a school uses a "pay what you want" approach, it's unlikely that they will be able to raise more money than they do under the current model, which enforces a minimum payment but allows for additional contributions from those with the means and generosity to do so. If a school started trying to enforce some sort of "suggested donation" in order to avoid "free riders," they would immediately move into some very questionable moral and legal ground. They couldn't reasonably claim that the money given is a donation if they kick out anyone who doesn't donate enough. That's a lawsuit waiting to happen. Op-Ed: http://www.nytimes.com/2012/08/24/opinion/is-private-school-not-expensive-enough.html?_r=1 Responses: http://www.nytimes.com/2012/09/04/opinion/the-true-costs-of-private-schools.html
Alex Suchman at Quora Visit the source
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