Robert F. Smith, Chairman and CEO of Vista Equity Partners, continues his philanthropic support of Historically Black Colleges and Universities (HBCUs) with a donation of $ 50 million to the Student Freedom Initiative.
The Student Freedom Initiative is a charity that helps students at institutions that serve minority groups evade student debt and credit. The initiative offers students an income-based alternative to the high costs and debt of borrowing. The initiative also offers paid internships as well as study and tutoring opportunities.
"Every year thousands of black HBCU graduates across America join the workforce with a heavy burden of debt that is holding back future decisions and preventing opportunities and choices," Smith said, according to Yahoo Finance. “A college education should empower our next generation and prepare them for a limitless future. The Student Freedom Initiative is a highlight of my work following my gift to Morehouse College Class in 2019. The US $ 1.6 trillion debt crisis in our country is a human rights crisis. The initiative was specifically built to address historical economic and social inequalities and provide a sustainable, scalable platform to invest in training future black leaders. "
Smith, who is also the chairman of the board of the Student Freedom Initiative, believes that after leaving college, people should be financially free to pursue their dreams. Instead, many college students are already graduating thousands of dollars in the hole, which limits where they can move, what jobs they can take, and even whether or not they can start their own business.
The average student loan debt is more than $ 30,000 and the average student loan interest rate is 5.8%. This means it could take some more than a decade to repay their loans.
Last year, Smith pledged to repay Morehoue's senior year loans and his team identified significant problems in the structure of the student loan, including a lack of options to pay off the debt. As a result, students are typically limited to parent PLUS loans and private loans. Both account for more than half of the debt incurred in attending HBCUs.
Smith has given away millions in donations over the past few years. In addition to Morehouse, he donated $ 50 million to Cornell Engineering School and $ 20 million to the Smithsonian National Museum of African American History and Culture in 2016.
Smith also pleaded guilty to tax fraud last week and admitted to the US Department of Justice (DoJ) that he was guilty of tax evasion and hiding money in the shell Companies,. Under an agreement with the DoJ, Smith will repay $ 130 million in taxes and give up more than $ 180 million in donations to charity.