Senator Charles Grassley (R-IA and ranking member of the Senate Finance Committee) has asked the IRS to prepare a separate form for colleges and universities to complete in lieu of the traditional Form 990. The form would require a greater level of disclosure related to student populations, endowments and executive compensation. A spokesman for Independent Colleges and Universities criticized the idea, saying that an unintended consequence might be a increase in tuition. Grassley's proposal may have been influenced by results of a recent Form 990 from Harvard University, which forced the well-known institution to provide greater levels of financial aid to its students.
My initial inclination would be similar to Law professor Jon Forman--"let the sunshine in." Most public universities are having to provide greater levels of disclousure to boards of trustees as is; it should not be greatly incremental more difficult (assuming an IRS form with sufficient clarity, not always a safe assumption) to provide the info to the IRS. Heaven knows that university faculty and administrators have called for greater business disclosure on plenty of occasions.