Hillsdale Collegian 11.30.17

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Michigan’s oldest college newspaper

Vol. 141 Issue 12 - November 30, 2017

www.hillsdalecollegian.com

Tax bill could target endowment, cost Hillsdale thousands By | Breana Noble Editor-in-Chief A proposed tax could force Hillsdale College to pay up to $700,000 a year to the federal government. As part of the Republicans’ $1.5 trillion tax package, a new endowment tax would make private, nonprofit colleges and universities pay 1.4 percent on their yearly endowment income if the endowment is equal to $250,000 or more per student. It would affect nearly 70 institutions nationwide, including Hillsdale College and much of the Ivy League. The House passed the bill on Nov. 16, and the Senate voted Wednesday along party lines to open debate on the tax plan. A vote on the bill could occur by the end of the week. Hillsdale’s current endowment is $548 million, which breaks down to approximately $364,000 for each of the college’s 1,507 students - surpass-

ing the $250,000 minimum. Based on how the law defines an endowment’s income, Patrick Flannery, vice president for finance and college treasurer, estimated Hillsdale could pay as much as $700,000 a year if the legislation passes. The college operates on a $121 million annual budget. “Even a half million dollars per year, that’s enough to have an impact on how much money you can get distributed to general operations for the college,” Flannery said. “It’s something that we will have to think about: How are we going to make up for that?” For now, Flannery said the college is waiting to see what Congress decides. Matthew Spalding, associate vice president and dean of educational programs for the Allan P. Kirby Jr. Center for Constitutional Studies and Citizenship in Washington, D.C., said the tax comes in response to a general outrage

among members of Congress that schools with large endowments are using much of them, not to benefit students, but more like investment funds. “At that point, that endowment becomes something different,” he said. “If there is to be an endowment tax, it should only apply if the amount in the endowment fund exceeds that which is needed to support exempt purposes, such as direct asset use or providing financial support for students.” Spalding added that a broad perception that much of academia support a liberal agenda may also contribute to the support behind the proposal. An overwhelming majority of Hillsdale’s endowment supports scholarships, academic programs, and faculty, Flannery said. He became aware of the intended tax days prior to the plan being introduced in the House on Nov. 2, and he has

By | Nic Rowan Assistant Editor

stipulated that Meijer would have to develop the land within 10 years of its signing, should the corporation choose to buy the land, according to Hillsdale City Attorney John Lovinger. Board members and Fayette residents expressed concerns that the proposed agreement with Meijer seemed too rushed and without further deliberation, it could not sign the agreement in good conscience. “I think we need more information and need to do more work on this,” Board Trustee Alfred DuBois said. According to Michigan state regulations, the state can

take up to 30 days to approve a 425 agreement, making Nov. 30 the absolute last day that Fayette could sign the agreement for it to be filed this year. Since the board voted 2-2 deadlock and board supervisor John Kalusniak was not present at the meeting to cast a tie-breaking vote, the township will not be able to decide on the issue until at least next March, according to Hillsdale City Manager David Mackie. “If Meijer finds it difficult to deal with a community, then they might decide that community is not open for business and walk away,” Mackie said See Meijer A6

Township deadlocks on Meijer vote Meijer will not be able to come to Hillsdale County, not this year at least. Following a deadlock vote at a special meeting held by the Fayette Township Board on Nov. 29, the future of a 425 agreement that would have allowed Meijer to purchase and build a grocery store on a property located off M-99 remains uncertain. The agreement would allow for revenue sharing between the city of Hillsdale and Fayette township; Fayette would provide Meijer the land, Hillsdale the utility services. Additionally, the agreement

been in discussion with members of Congress since then. College President Larry Arnn joined him in some high-level meetings prior to Thanksgiving break. Spalding said he opposes the tax in general on principle. He said the taxation of endowments to influence universities sets a dangerous precedent that threatens their independence. “In general, there should be an area of activity outside of government reach that serves higher purposes of society beyond that reach, and private education has long been one of those,” Spalding said. “If the federal government establishes a tax on endowments for colleges, I fear there are other activities that under another Congresses and other administrations government will tax and by doing so regulate, and that could be more threatening to Hillsdale.” Adding to that, the legislation does not exempt

non-Title IV institutions, such as Hillsdale, that do not receive government money. A majority of the universities and colleges affected by the tax, however, do take federal subsidies. At some of these private, nonprofit schools, they account for up to 70 percent of their income, according to Spalding. Princeton University, whose $23.8 billion endowment is one of the largest in the country (Harvard University has the largest with $37.1 billion), received $420 million in tax breaks on its endowment income, federal research grants, and capital-gains exemptions in 2011, according to The Atlantic. That year, its endowment was $17 billion and accounted for almost half its nearly $1.4 billion operating budget. “Since Hillsdale receives no federal funds or grants whatsoever, Hillsdale’s position is distinguishable on policy grounds,” Spalding said.

“Hillsdale and other colleges that are not taking the federal government’s money should not be subject to a tax on an endowment that was raised from private sources Spalding said he has made several suggestions to policymakers, including removing the tax entirely, rewording it, or inserting an exemption for schools that refuse government subsidies. He also said an alternative to the tax is to cut the number of government subsidies going to these institutions. Arnn agreed in an email: “The government subsidizes a thing with one hand and then taxes it with the other. Why did they not simply decrease the subsidies? What they do carries the implication that only the government can get bigger.”

See Endowment A2 Pexels

Gelzer Hardware begins move By | Breana Noble Editor-in-Chief Demolition work began at 115 E. Carlton Road this week for the new location of H.J. Gelzer & Son Hardware Inc. The hardware and sporting good company in downtown Hillsdale will move just a couple of blocks for a larger and more open space, more room for parking, and the opportunity for further expansion. In doing so, the company is investing more than $700,000 and a year in time to construct a new building with a grand opening next summer. “We’re looking forward to securing the future of this business,” said Andrew Gelzer, the great-great grandson of the company’s founder, Henry J. Gelzer. “We are happy and

honored to reinvest in our community.” The expansion is indicative of a trend of recent investments in Hillsdale, City Manager David Mackie said, including from the industrial companies such as Paragon Metals as well as smaller businesses such as Rough Draft. Mary Wolfram, the City of Hillsdale’s head of economic development agreed: “This is a huge statement of confidence in the city. A current business owner is willing to invest to rehabilitate a building and expand. They must think business is going to be good in Hillsdale.” The company demolished a two-story building on the new property built by its previous occupant Alson’s Corp. on Monday. On the existing con-

crete floor, it will construct a new nearly 12,000-square-foot retail space that will offer approximately 30 percent more inventory. A parking lot being built to the north, south, and west of the building will offer space for customers with trailers. It also is giving some updates to the original five-story warehouse that the business will use for storage and receiving deliveries. Its 125,000 square feet will provide space to expand in the future, too. “We’ll have room to grow the business for the next 40 years,” Gelzer said. The company’s furniture store, which has used the warehouse on the new property since the company bought it in 2011, will stay in the downtown.

Hillsdale resident Ed Clark performs with the Dale Vaughn Band on Nov. 18 at Here’s to You Pub & Grub. Madeline Fry | Collegian

See Hardware A7

Volleyball rides home court to G-MAC tournament win By | Michael Lucchese Senior Writer Hillsdale College volleyball won its first-ever G-MAC tournament on Saturday, November 18, overcoming the Findlay Oilers in a hardfought 3-1 championship victory at the Dawn Tibbetts Potter Arena. This is the fourth conference championship the Chargers have won in the program’s history. Their success extended their winning streak to 21 matches and improved their overall record to 28-3. “We just took the tournament one game at a time and played as a team,” junior rightside hitter and G-MAC Player of the Year Paige VanderWall said. “It was important for us to treat each game as a normal game instead of part of a special conference tournament.” Hillsdale began tournament play with a 3-0 sweep of the Davis & Elkins Senators on Nov. 16. Head coach Chris Gravel said that a deep bench was Follow @HDaleCollegian

important to Hillsdale’s success in the tournament, and that was on display against the Senators — every player in the line-up saw time on the court. Freshman middle hitter Allyssa Van Wienen made seven kills for a personal hitting percentage of .600. VanderWall made eight kills of her own for a .417, and supplied eight digs for the team. Senior outside hitter Jackie Langer achieved a career-best hitting percentage of .889, making eight kills on nine attempts. Langer was awarded conference player of the week for her performance in the tournament. “She’s so deserving of it,” VanderWall said. “She has been such a consistent offensive weapon for us as well as a great defensive player.” The next day, the Chargers overcame the Walsh Cavaliers 3-1 to advance to the tournament finals. Langer led the Chargers’ offense again with a season-high 22 kills. Junior outside hitter Kara Vyletel followed with 13 kills and six digs of her own.

VanderWall also performed well, scoring 12 kills and 15 digs. Sophomore middle hitter Hannah Gates also made 12 kills, a new career-high. Overall, the team had 68 kills and a .284 hitting percentage to Walsh’s 33 and .085. Freshman setter Lindsey

11 digs, and 55 assists. Mertz was awarded freshman of the year by the conference office, making her the third player in Hillsdale history to win this distinction. “Our future looks bright, thanks in part to our freshmen,” head coach Chris Grav-

The Chargers celebrate on the court after their G-MAC tournament victory on Nov. 20. Todd Lancaster | Courtesy

Mertz also played well against el said. “The upperclassmen the Cavaliers, with three kills, have done a great job assimiwww.hillsdalecollegian.com

lating the young players to the program.” The Chargers clinched the conference title the following Saturday, defeating Findlay 3-1. The opening set of the match did not go Hillsdale’s way — Findlay won it 25-22. The Chargers rallied after that to win the next three sets 2514, 25-17, and 26-24. “The two biggest things that made the difference this tournament,” freshman libero Madie Schider said, “were our teamwork and our will to win.” Hillsdale’s defense showed both of those qualities against Findlay. Sophomore libero Taylor Wiese had 22 digs to lead the defense, followed by Mertz with 14 digs of her own and 44 assists. Schider also contributed to Hillsdale’s back row, making six digs and scoring a service ace. Blocking was another strong element of the Chargers’ defense. Findlay made four during the match, while Hillsdale made 11 total. Van Wienen had six block assists,

followed by Gates with four. VanderWall once again led the team’s offense, with 15 kills and a .378. Langer had 11 kills, eight of which came in the critical fourth set, and Van Wienen made 10. Hillsdale will face Findlay a fourth time this season, in the NCAA regional quarterfinals on Thursday afternoon at Lewis University in Romeoville, Illinois. “Honestly, we’re making very few changes in how we’re preparing for regionals,” Gravel said. “We’ve got to stay cool and just continue going at it in practice.” The winner of Thursday afternoon’s match will progress to the regional semifinal and play the winner of a Rockhurst-Bellarmine matchup. VanderWall said that the team is confident looking ahead to the regional tournament. “We’ve played Findlay already,” she said. “We’re going to use what we’ve learned about them to play tough and pick out their weaknesses.” Look for The Hillsdale Collegian


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