Is the College Board Really a Nonprofit?
It’s no surprise that the College Board is extremely profitable. The sprawling organization, which oversees the SAT, PSAT, and AP exams, currently holds a powerful position in the high school curriculum and college admissions process. In the fiscal year of 2021, the College Board made over 1.1 billion dollars in revenue. And while high revenue itself is not an indicator that an organization isn't a true nonprofit, a lack of transparency in how the College Board spends their high revenue calls their charitable status into question.
In their own words, the College Board is a “mission-driven not-for-profit organization that connects students to college success and opportunity,” aiming to aid the transition from high school to college by providing “programs and services in college readiness and college success.” Their mission in promoting equity and access has qualified them to register as a nonprofit, an organization given tax-exempt status by the IRS for their supposedly philanthropic purpose.
Legally, the College Board fits the requirements of a nonprofit organization: in accordance with the IRS Public Charity Support Test, it receives “more than one-third of its support from contributions from the general public and/or from gross receipts from activities related to its tax-exempt purposes and “no more than one-third of its support from gross investment income and unrelated business taxable income.” However, amidst debates of educational inequity, many question whether the College Board has been using their money to serve the public good, or simply to further enrich themselves.
It currently costs 96 dollars to take an AP (Advanced Placement) exam, which can be reduced down to 34 dollars with a fee waiver. It costs 60 dollars to take the SAT, the high-stakes standard test known for its influence in the college application process. Registering late adds an extra 40 dollars, and sending an AP exam score to a college costs 15 dollars. In addition, the College Board demands 18 dollars for The QAS (Question Answer Service), which shows students which questions they got wrong on the SAT, and 13.50 for the SAS (Student Answer Service), which shows students SAT question type and difficulty. There is no doubt that those who are able to afford these services gain an advantage in their test taking. With millions of test takers each year and fees at every corner, it is not difficult to believe that the College Board is aiming to maximize their profit at the expense of student success.
Meanwhile, College Board executives are compensated generously for their work, frequently earning hundreds of thousands of dollars each year. In fact, College Board CEO David Coleman made 1.8 million dollars in 2018. Other top executives earned upwards of 500,000 dollars. Additionally, the organization currently holds more than 1.6 billion dollars in cash and investments. According to IRS tax filings, investments in hedge funds have generated hundreds of millions of dollars for the College Board, much of which is housed in tax havens in the Caribbean.
The College Board claims to use their profit to mitigate educational inequity and improve their services, but they often fail to mention another common use of their money: lobbying. Since Coleman’s takeover as CEO in 2012, the College Board has doubled expenditures on state and federal lobbying. In order to minimize competition from the ACT and other standardized tests, the College Board has aggressively lobbied states to require their students to take the SAT. It is unclear how this practice “connects students to college success and opportunity.”
Though the College Board qualifies as a nonprofit in name, the educational monopoly’s investment practices often resemble those of a for-profit organization. This is to say that, despite their charitable cause, the College Board has not fully committed to being either non or for-profit. Instead, they seem to hang indefinitely between the two statuses, picking and choosing the aspects that will benefit them the most.
by VIVIAN WANG