The University Accountability Act imposes financial penalties on tax-exempt colleges and universities that are found by federal courts to violate civil rights laws under Title VI of the Civil Rights Act of 1964. Each civil rights violation judgment triggers a penalty of either $100,000 or 5 percent of the institution's administrative compensation (whichever is greater), with penalties reversed if the judgment is overturned on appeal. The bill also requires the IRS to conduct a mandatory review of an institution's tax-exempt status if it receives three or more civil rights violation judgments, and mandates that affected universities report all civil rights determinations to the IRS on their annual tax filings. The legislation applies to all eligible educational institutions that hold tax-exempt status, including state colleges and universities, and takes effect for violations determined after the bill's enactment.
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