Only 21 colleges with high default rates — 20 for-profits and one public adult education program — are set to lose access to student aid this year. Many more were at risk. At the last minute, the U.S. Department of Education decided to omit some defaulted loans when calculating default rates.
The rate is based on the percentage of borrowers who defaulted three years after entering repayment. Tuesday, the department announced it wouldn’t count borrowers who defaulted on one loan but not on a second loan. In some cases, borrowers must repay different loan-servicing companies, which can cause confusion. The adjustment was made only for colleges that risked losing eligibility for student aid.
It’s a Get-Out-of-Jail-Free Card applied selectively with no transparency, writes Clare McCann on EdCentral. Cherry-picked colleges now have lower default rates than colleges that weren’t at risk of sanctions. “There’s no indication of which institutions benefited, in which sectors, or by exactly how much.”
Federal regulations already provide opportunities for colleges to appeal their default rates based on a variety of factors, including poor-quality servicing. Why not simply run this process before finalizing the rates, rather than oddly offering up this upfront assistance?
High-default colleges get a break, but students don’t, adds McCann. Borrowers still are considered in default, even if it isn’t counted against their college.
Community colleges and historically black colleges and universities — both with low-income students and high default rates — had lobbied for relief, notes Inside Higher Ed. “On Tuesday, Education Secretary Arne Duncan said he was pleased that no historically black colleges and universities would face penalties for their default rates this year. Fourteen historically black institutions had default rates above the 30-percent threshold last year.”
Default rates fell slightly for community colleges, the Education Department announced. No community colleges face sanctions.
Critics said the last-minute adjustment undercuts accountability.
“If a school isn’t held accountable for a default, then the borrower shouldn’t be either,” said Debbie Cochrane, a researcher at the Institute for College Access and Success.
Representative George Miller of California, the top Democrat on the House education committee, was one lawmaker who pushed for the expanded three-year default rates. He questioned the department’s adjustment to the loan rates on Tuesday.
“Any changes in the student loan system that reduce transparency and consistency may compromise our ability to hold poor-performing colleges accountable,” Miller said in a statement. “The department should be doing everything it can to ensure student borrowers who have defaulted have every opportunity for redress.”
Community college advocates praised the adjustment. “We believe that the department has acted responsibly by not holding financially needy students hostage to the shortcomings of servicers and other parties involved in loan administration,” said David Baime, senior vice president for government relations and policy analysis at the American Association of Community Colleges.
Should students loans be available for job training?
Under the federal Higher Education Act, students are eligible for Title IV student loans and grants only if they attend formally accredited institutions. That makes some sense, for purposes of quality control. Except that under the law, only degree-issuing academic institutions are allowed to be accredited. And only the U.S. Department of Education gets to say who can be an accreditor.
By blocking new competitors, the system drives up costs, argues Lee. That prices most Americans “out of the post-secondary opportunities that make the most sense for them” and plunges “most of the rest deep into debt to pursue an increasingly nebulous credential.”
The Higher Education Reform and Opportunity Act would give states the power to create their own, alternative systems of accrediting Title IV-eligible higher education providers. . . . State-based accreditation would augment, not replace, the current regime. (College presidents can rest assured that if they like their regional accreditor, they can keep it.) But the state-based alternatives would not be limited to accrediting formal, degree-issuing “colleges.” They could additionally accredit specialized programs, apprenticeships, professional certification classes, competency tests, and even individual courses.
States could allow the Sierra Club to accredit an environmental science program, a labor union to accredit its apprenticeship program and Boeing to accredit an aerospace engineering “major,” Lee writes. Professors — or others with expertise — could go freelance, offering their teaching talents online.
In today’s customizable world, students should be able to put their transcripts together a la carte – on-campus and online, in classrooms and offices, with traditional semester courses and alternative scenarios like competency testing – and assistance should follow them at every stop along the way.
Employers already have shifted a lot of job training to community colleges. Now they could keep it in house — if their state agreed — with federal taxpayers footing the bill. Smashing the cartel could make today’s quality control problems even worse, responds Jordan Weissmann on Slate.
The entire point of requiring schools to be accredited before they can become eligible for federal aid is to make sure students don’t take out loans for a worthless education while burning taxpayer money in the bargain. As the rise of unscrupulous for-profit colleges demonstrates, the accreditors have basically abdicated that responsibility. Adding yet more accreditors into the mix, and making more programs eligible to profit off of loan dollars—without making it easier to kick schools out—would only worsen our problems with predatory colleges.
“Agencies might be more willing to punish a bad actor if they could downgrade its accreditation status rather than revoke it entirely—which is the only option available to them right now,” writes Weissmann. That’s one of the ideas proposed by New America policy analyst Ben Miller on EdCentral.
Most federal support for job training flows through student aid, not workforce development programs, writes Mary Alice McCarthy on EdCentral. Federal student aid provides $150 billion a year to college students in vocational certificate and associate degree programs, while only $20 billion goes to all federal workforce programs.
Ready to Work: Job-Driven Training and American Opportunity and What Works in Job Training: A Synthesis of the Evidence, both released by the vice president’s office on July 22, lay out the federal workforce development system.
While there are 47 employment and training programs implemented across ten federal agencies, most federal funds come from four agencies and a few programs, McCarthy writes. Including the Workforce Innovation and Opportunity Act, $18 billion is spent by Temporary Assistance for Needy Families (TANF), the Carl D. Perkins Career and Technical Education Act (CTE), and military tuition assistance programs financed through the Departments of Defense and Veteran’s Affairs.
These days, community college is “where people go to get skills for work,” she writes. Yet there’s “minimal accountability” for the large and growing share of federal student aid for college students in job-training programs. Many programs don’t fit the administration’s call for “job-driven” training designed with employers to fill high-demand jobs.
Federal student aid “is oddly exempt from national discussions about how to improve America’s job training programs. Until those dollars are truly on the table, we’re not talking about the federal policies that can really make a difference in connecting postsecondary education and work.”
Job training is very hard to do well outside the workplace. . . . Engaging employers, identifying in-demand skills, accelerating learning, designing programs to meet diverse and non-traditional learners, providing effective student supports – it all works and it’s all hard.
Job training can’t do it all, writes McCarthy. “Globalization and technological change are transforming production processes and disrupting labor markets around the world, generating profound changes in how firms hire, compensate, and train employees.”
On the education front, we need policies that will make schools – particularly institutions of higher education – more responsive to the needs of students for concrete skills and transparent credentials. On the employer front, we need policies that promote firms to either invest directly in the skill development of employees (apprenticeship programs, on-the-job training) or that enable their workers to more easily combine work and learning (better leave policies, tuition assistance, etc). Policies also need to recognize that people will be moving in and out of jobs more often, and will need support for up-skilling and periodic bouts of unemployment.
And, “it doesn’t matter how good your job training programs are if there aren’t enough jobs to go around.”
First-year college students who file the Free Application for Federal Student Aid (Fafsa) late receive less student aid, a new study shows.
Community-college students, part-time students and older students are especially likely to not file a Fafsa or to file it late.
Researchers suggest that “Fafsa-completion efforts should be focused on high-school students who are likely to attend community colleges and on students who enroll late at community colleges,” reports the Chronicle of Higher Education.
Joshua Polson at The Greeley Tribune
Professor Jeanine Lewis reviews complex numbers during class at Aims Community College.
Colorado’s community colleges and state universities are improving remedial success rates, according to an annual progress report. Statewide 62 percent of remedial students completed their course, up from 59 percent the previous year.
At community colleges, retention rates were higher for first-time remedial students than for classmates who started in college-level courses. Fifty-eight percent of remedial students — but only 55 percent of non-remedial students — returned for a second year.
Fewer high school graduates require remediation: At community colleges, the rate fell slightly to 64 percent.
Offering developmental classes in high schools and expanding dual enrollment has helped, reports Inside Higher Ed.
Lt. Governor Joseph Garcia, the former president of Colorado State University at Pueblo and of Pikes Peak Community College, has taken the lead. It’s not easy, he said.
For example, the state’s community colleges have worked to boil down three semesters of remedial coursework into just one. It’s a labor-intensive job. But the end result will mean students can complete remedial work and “gateway” courses in math and English in just one year.
. . . “That saves the student time and money. And that saves the state money,” Garcia said
State standards are better aligned with college placement requirements, said Garcia. In addition, Colorado uses GEAR UP, a federally funded program that “targets low-income students in middle and high schools, offering intensive advising, dual enrollment and college preparation courses.”
Colorado also has changed the way state aid to students is distributed, notes Inside Higher Ed. “Students now receive more aid when they hit milestones on their way to a credential. Awards are also decreased if students do not graduate on time.”
Community college leaders must speak out on revisions to the Higher Education Act before it’s too late, said Belle S. Wheelan at the annual convention of the American Association of Community Colleges in Washington, D.C.
Wheelan, president of the Southern Association of Colleges and Schools Commission on Colleges, said a reauthorized HEA could hurt open-access colleges, reports Community College Week.
It could include provisions tying the receipt of federal money to minimum completion rates. It might create new penalties for colleges with high student loan default rates. And it’s up to community college leaders to tell Congress how unpalatable measures like that are, before they become law, Wheelan said.
“If you look at the policies coming out of Washington, they are still focused on that 18-21 year old cohort, which is only 13 percent of out students,” she said. “We are trying to get the folks in Washington to understand that. Help us help the powers that be understand that.”
The AACC and the the Association of Community College Trustees have a wish list for the reauthorized Higher Education Act reports Community College Week.
Protecting Pell Grant funding, reinstating the year-round grant and increasing Pell flexibility top the list. Community colleges attract many Pell-eligible students from low- and moderate-income families.
Measuring student success accurately also is a priority.
Current metrics used by the federal government exclude significant numbers of community college completers, causing distortions in public perceptions of institutional outcomes.
. . . The federal government must ensure that students are tracked throughout their course in postsecondary education. There are different routes to achieving this end, but the lack of national framework for monitoring student progress, such as a federal unit record database, must be addressed.
Community college leaders also want to see a redesigned index to track student loan defaults, simplification of student aid and income-based repayment schemes and the authority to discourage “overborrowing” by part-time students.
Colleges are failing older students, writes Lila Selim in The Atlantic. She flunked out of college in her sophomore year, cycled through part-time programs and finally earned a degree. That makes her part of the “new majority” of older students. Few can enroll full-time while supporting themselves “and often a child or relative.”
Unfortunately, part-time attendees are set up for failure. Most universities, even community colleges, which are meant to serve just these kinds of students, schedule few classes in the evenings. Administrative offices aren’t open outside of business hours. Online classes, widely touted to adult learners as practical and convenient, are hard to commit to . . .
Part-timers get very little student aid, Selim writes. Pell Grants cover a small share of college costs and are prorated. Universities usually reserve scholarships for full-time students.
The Full Time is 15 initiative is encouraging colleges to provide incentives to students who take 15 credits — not just 12 — per semester. That moves students more quickly to a degree — if they can afford to take that many units. But trying to push adults “into the traditional student model only locks them out of the system, she writes.
Several schools are also pushing programs to make school more conducive to working adults—from things as simple as offering consistent courses at consistent times, so students can plan their next term, to adding prior learning assessment programs, where, for of a fraction of normal tuition cost, a student can create a portfolio displaying academic study related to their previous professional experience.
The 18- to 22-year-old full-time, dorm-dwelling residential college student represents only 15 percent of college enrollees, writes Tressie McMillan Cottom in Slate. President Obama’s college ratings plan has little relevance to working, child-raising adults, she argues. “Their educational choices are often about convenience, geography, and access.”
Older students “may take longer to graduate” and “may need to cobble together credits from several institutions,” Cottom writes. The financial aid system should be redesigned to meet these students’ needs. They’re not “non-traditional.” They’re “typical.”
Negotiations are underway on “gainful employment” regulations proposed by the U.S. Education Department, reports Community College Times.
While the regulations are expected to hit hardest at for-profit career colleges, vocational programs at community colleges also will be affected. Colleges must gain federal approval for some new programs or students won’t be able to get federal aid.
“Whatever the regs are, you’ve got to keep them simple, you’ve got to keep them affordable,” said negotiator Richard Heath, financial aid director at Anne Arundel Community College (Maryland).
“Any time I add a new program, it is vetted to death,” Heath said.
Unnecessary layers drag out the time to create new programs that local businesses need, and they are expensive, Heath said. They can add months to the approval process and tens of thousands of dollars in costs.
Negotiators will meet again Oct. 21 to 23. If they don’t reach a unanimous consensus on the rules, the department can propose its own final version.
Kevin Jensen, financial aid director at the College of Western Idaho, also was one of the 14 negotiators. Three alternates from community colleges are: Rhonda Mohr, student financial aid specialist at the California Community Colleges Chancellor’s Office; Glen Gabert, president of Hudson County Community College (New Jersey); and Sandra Kinney, vice president of institutional research and planning at the Louisiana Community and Technical College System.
The cost of Pell Grants has “risen dramatically” in recent years, reports the Congressional Budget Office. From 2006–2007 to 2010–2011, inflation-adjusted spending on Pell grants increased by 158 percent. The number of recipients increased by 80 percent and the average grant amount increased by 43 percent in inflation-adjusted dollars. The maximum grant for 2013–2014 is $5,645.
The CBO report analyzes proposed money-saving options, such as shrinking the size of grants or reducing the number of recipients by tightening eligibility criteria.
However, some believe grants should be increased to cover a higher percentage of college costs, the report notes. Legislators “could increase the size of grants for all low-income students . . . or offer greater amounts to students who make particular educational choices.”
A set of options that would tighten means-testing, impose more rigorous academic requirements, and reduce the grant amounts could cut the program’s costs in half, saving an average of about $20 billion per year, but would reduce the number of recipients by 40 percent.
Options for simplifying Pell including asking for less financial information on the Free Application for Federal Student Aid (FAFSA) or linking eligibility to federal poverty guidelines.
There are other ways to broaden access postsecondary education, the report points out. Possibilities include forgivable loans, grant commitments to young teenagers, federal support of state grant programs and funding job training.
President Obama’s plan to link financial aid to college “value” could use a reality check, write Sandy Baum, a senior fellow at the Urban Institute, and Michael McPherson, president of the Spencer Foundation, in a Chronicle of Higher Education commentary.
If his plan goes into effect — which isn’t likely, they believe — “student aid would become much more complicated” and less predictable, which is a barrier to lower-income students.
While the federal government provides about $136 billion in grants and loans to undergraduate students, “state governments are primarily responsible for establishing, supporting, and managing colleges and universities,” Baum and McPherson write. Federal dollars go primarily to students.
Providing simple and meaningful information to students is a good idea. But the reality is that it’s not easy to measure postsecondary outcomes. What students learn is not on the list, probably because of the measurement challenges. But surely it is at or near the top of the list of what we should care about. We want people to get good jobs when they finish school, but do we really want to suggest that maximizing earnings should be the primary goal? Should we value colleges that educate investment bankers more than we value colleges that educate teachers and social workers? Did the president waste his expensive Ivy League education when he went to work as a community organizer instead of heading to Wall Street?
Open-access colleges that enroll many low-income students won’t have the same graduation rates or debt levels as elite colleges with affluent students, they point out. Comparing “similar” institutions isn’t easy.
Furthermore, “the penalty for a college that charges its students too much is to take away some of those students’ Pell Grant dollars, making the unfortunate students who enroll there still worse off,” Baum and McPherson write.
Perhaps the idea behind the proposal is that students will vote with their feet. They will avoid colleges that charge too much or don’t have high enough graduation rates. In reality, students don’t have that much flexibility. If a low-income student lives in a state with a poorly run public system, she’s stuck, unable to afford out-of-state tuition or private alternatives. Cutting her Pell Grant just doesn’t help.
The president also wants to expand income-based repayment of student loans, which Baum and McPherson support, if loopholes are closed.
Federal subsidies for “cost-cutting innovation,” is fine in theory, they write, but we don’t know if MOOCs will “help students—particularly at-risk students—learn more while paying less.” It’s also not clear whether “competency-based degrees . . . will increase meaningful educational opportunities or just let us count more people as having college degrees.”
Four key ideas in President Obama’s proposal have been championed by major foundations and policy analysts, including the Gates Foundation, the Lumina Foundation and the New America Foundation, notes the Chronicle.