The U.S. Education Department will rewrite “gainful employment” regulations fought bitterly by for-profit colleges, according to a notice published in the Federal Register. The department plans to use “negotiated rule-making” to move forward its agenda on college aid and affordability, substituting regulation for legislation, notes Inside Higher Ed.
The traditional venue for enacting long-term changes to help students afford, attend and graduate from college would be the Higher Education Act, the massive law governing federal financial aid programs that is periodically rewritten to account for changing times or to pursue new policy goals.
Usually, negotiated rule-making comes after the revised act is signed into law, to wrangle with details and write more precise regulations to put a legislative vision into practice. The Education Department convenes a panel of stakeholders — representing different sectors of higher education as well as some advocacy groups — to hammer out new regulations for colleges to follow.
The Obama administration has proposed expanding Perkins Loans and federal work-study to reward colleges that offer “good value” by keeping cost-per-degree numbers down. However, spending more will require legislation.
The department used “negotiated rule-making” to write the “gainful employment” rule, which was partially overturned in court last year.
Congress members are pushing back. House Committee on Education and the Workforce Chairman John Kline, R-Minn., Rep. Virginia Fox, R-N.C., and several Democratic representatives sent a letter urging Secretary of Education Arne Duncan to “abandon these harmful regulations and instead work with Congress to strengthen the nation’s higher education system through reauthorization of the Higher Education Act.“
President Obama’s proposed change to student loan interest rates means today’s college students would save money but future students could pay much higher rates, reports Inside Higher Ed. The change, part of the president’s budget plan, would tie student loan interest rates to the government’s cost of borrowing. Right now, that’s very low. But if the economy improves, interest rates are expected to rise.
If Obama’s plan had gone into effect in 1990, “many students would have been looking at 10 or 11 percent interest at several points in the recent past, points out Jordan Weissmann in The Atlantic.
Student groups criticized the interest rate plan, reports Inside Higher Ed. “Without a cap, this proposal falls far short of the comprehensive reform to student loans that we need,” five groups representing young voters — the National Campus Leadership Council, Rock the Vote, U.S. Public Interest Research Group, Young Invincibles and Our Time — said in a combined statement. “Students have never taken out federal student loans without a cap on how high interest can go.”
The change in student loan interest rates is likely to become law, since it resembles a Senate Republican proposal, according to Inside Higher Ed. Other proposals are long shots.
. . . much of the budget — particularly proposals that call for new federal spending — is a politically symbolic wish list of ideas with little chance of becoming law: $8 billion in new money for community colleges from the Education and Labor Departments; a $150 million expansion to federal work-study; and $1 billion for a new competition among states to improve public higher education, among others. Obama proposed increasing discretionary spending on the Education Department by 4.6 percent over all, and increasing the maximum Pell Grant to $5,785 for the 2014-15 academic year.
The budget plan calls for supporting development of “third-party validation systems” for competency-based learning and ways to fund programs with good student outcomes, regardless of accreditation.
“Not everyone has to go to a four-year liberal arts college. We still need plumbers,” said Republican Sen. Marco Rubio in a speech at the Conservative Political Action Conference last week.
“Why aren’t we graduating more kids not just with a high school diploma but with an industry certification degree?” he asked the auditorium full of conservatives.
According to Rubio,there are 3 million jobs that aren’t being filled because Americans don’t have the right skills for these jobs.
“They need skills for these jobs,” he continued.”So, instead of being a receptionist, she can be an ultra-sound tech.”
Rubio also argued that not only are not enough Americans acquiring useful skills, but so many of these same Americans are graduating from four-year universities swamped in student debt.
The 41-year-old senator recently finished paying off his student loans using the proceeds of his book. He borrowed nearly $150,000 to earned a bachelor’s degree from the University of Florida in 1993 and a law degree from the University of Miami in 1996.
Digital learning is expanding higher education options for California students, reports the San Jose Mercury News.
Estela Garcia, a working mother from Menlo Park, attends class at her kitchen table after she puts her daughters to bed; Tim Barham, a UC Berkeley senior, takes statistics at home after a day at work; and Oakland teenager Sergio Sandoval studies a college course while in high school.
“I think this is the single most transformational thing that could occur in higher education in decades,” said Ron Galatolo, chancellor of the San Mateo County Community College District.
With the urging of Gov. Jerry Brown, California’s universities are expanding online options. The University of California, whose campuses offer more than 2,500 online classes, may require undergraduates to take 10 percent of classes online. As soon as this summer,
San Jose State University and Udacity, a Mountain View-based company, “could open for-credit math classes to all takers, at $150 each. Some 300 high school, community college and university students are in a pilot program to test the classes.”
Galatolo wants to work with Udacity to design refresher courses to help incoming students ace placement tests, avoiding the remedial “black hole.”
Estela Garcia and a former classmate, Kelsey Harrison, said their online coursework requires self-discipline.
Still, because of the relatively small size of the class, it was easy for them to reach their College of San Mateoinstructors when they needed help. That kind of communication between students and faculty is impossible in a course with thousands of students. Those courses rely on virtual study groups and crowd-sourcing — seeking answers from the whole universe of students.
A well-developed online class might reach struggling students better than a traditional one, said Ronald Rogers, the San Jose State professor who developed Udacity’s statistics course. Rogers said when he stands in a lecture hall and asks if anyone has a question, nary a hand goes up. The new platform inserts short exercises and quizzes into the lecture, prompting instant student feedback.
“Imagine being in a class where if every minute and a half, the teacher shut up and asked if you got it,” he said.
Online courses helped Tim Barham transfer from a community college to Berkeley a year early. Now at Cal, the legal studies major is taking statistics online. Otherwise, he said, “I would have had to graduate later or cut down on work hours, which I can’t afford to do.”
Older students are looking for ways to combine credits earned in many ways to complete a degree, reports the New York Times. New Jersey’s Thomas Edison State College, a pioneer in flexible, low-cost degrees, is growing rapidly. So are Charter Oak State College in Connecticut and the private, nonprofit Excelsior College in New York. ”The idea of measuring students’ competency, not classroom hours, has become the cornerstone of newer institutions like Western Governors University,” the Times adds.
Pilar Mercedes Foy, 31, a Thomas Edison graduate whose parents did not go to college, said after she got an entry-level job at PSEG, the New Jersey energy company, she realized that she would need a degree to advance. She earned the bulk of her credits through heavily subsidized evening classes offered at work, supplemented by classes at Union County College and 12 credits from the CLEP Spanish exam.
Foy didn’t borrow a penny.
David Esterson, 45, of Whittier, Calif., started taking college classes in high school and attended the University of Washington for a year. After working for years as a photographer and starting a music business, he decided to complete his degree three years ago. He took online courses at the University of Minnesota and the University of Phoenix and at several California community colleges, before earning a bachelor’s degree in liberal studies from Thomas Edison. He’s now enrolled in two graduate programs.
On 11D, Laura McKenna advises people considering postsecondary education: “Don’t get an AA degree anywhere but at a super cheap community college . . . live at home, and get a part time job.”
She adds: Don’t get a degree in a profession that doesn’t require a degree. “You don’t need an AA degree in party planning” to be a party planner.
For those going for a bachelor’s degree, don’t borrow more than $15,000, try to finish in four years and “don’t choose a school based on the college atmosphere,” writes McKenna, a former political science professor.
President Obama’s College Scorecard is “a little buggy,” but may help those who can’t spot a rip-off, she writes.
Work for a year before starting college, adds Megan McCardle on The Daily Beast. “You’ll get much more out of the experience, and you won’t need to borrow as much.”
As an English major who went to graduate school, McCardle advises: “Don’t major in English or history. It’s getting hard to overcome a poor major choice by going to grad school.”
Both warn against investing time and money in low-value master’s degrees and PhDs.
In the State of the Union speech, President Obama promised to control college costs and provide a College Scorecard to help students and parents compare costs, graduation rates and loan repayments for any college or university. Some of the data is old and most has been available from other sources, reports the New York Times.
Further, the information is presented as averages and medians that might have little relevance to individual families. The scorecard does connect to each institution’s net price calculator, which allows individualized cost estimates, but it does not provide side-by-side comparisons of multiple schools, as other government sites do.
Meanwhile the Gates Foundation’s Reimagining Aid Design and Delivery project is generating more ideas.
In Aligning the Means and the Ends, The Institute for College Access & Success calls for doubling the maximum Pell Grant and giving students 7 1/2 years to complete a degree. Colleges should be rewarded for serving low-income students, TICAS urges. In addition, the white paper recommends:
• Use IRS data to simplify financial aid applications
• Combine income-based loan repayment programs into one plan that assures borrowers of manageable payments and forgiveness after 20 years.
• Eliminate higher education tax benefits and use the savings for Pell Grants and incentives for states and colleges to educate low-income students.
“For students who are willing to study, work, or serve their communities, the federal and state governments, along with their institutions, should make sure they can afford to go to college without the fear of crushing student loan debt,” argues the Education Trust in Doing Away With Debt. the Education Trust.
By taking the federal resources we already spend on higher education and focusing them like a laser on reducing college costs for families with incomes below $115,000 a year (the bottom 80 percent) — providing debt-free education to those below $50,000 (the bottom 40 percent) and no-interest loans with income-based repayment to the rest — we can do much to solve this critical problem without adding to the overall cost of federal student aid.
National Association of Student Financial Aid Administrators’ policy brief discusses reforming student loans, improving consumer information, “rethinking entitlement and professional judgment and ensuring that colleges and students have “skin in the game.”
Pell Grants should be replaced with a single federal-state matching grant, recommends the Committee for Economic Development in A New Partnership: The Road to Reshaping Federal & State Financial Aid. Cut higher ed tax credits to save $18.2 billion for student aid that expands access, the report also urges.
“Replacing Pell Grants and the other federal grant programs with a need-based grant that would be partly matched by states is both novel and controversial,” notes the Chronicle of Higher Education.
At a luncheon . . . to release the report, several audience members voiced skepticism about the plan, worrying that it would penalize students in states that chose not to participate, and expressing doubt that a federal methodology for determining need would distribute aid fairly.
William R. Doyle, the Vanderbilt University professor who wrote the report, said he doubted states would refuse the aid, given the consequences for their students and colleges. He noted that states fought matching requirements in Medicaid and elementary and secondary education, but ultimately accepted the money.
“The federal government can’t be the only actor that’s concerned with access,” he argued. “They have to start expecting something back from states and institutions.”
The report is one of the studies commissioned by the Gates Foundation’s Reimagining Aid Design and Delivery project.
A “more understandable effective and fair” student aid system doesn’t need to cost taxpayers more money, concludes a New America Foundation report, Rebalancing Resources and Incentives in Federal Student Aid. The study was funded by the Gates Foundation’s Reimagining Aid Design and Delivery project.
To eliminate any future “funding cliffs,” Pell Grant funding should be guaranteed, turning it into a true entitlement, the report recommends. In addition, the maximum grant should be increased and year-round funding restored to help students complete degrees more quickly. The “ability to benefit” provision would be restored, opening the door to students who lack a high school diploma or GED.
All this would cost more money, but the report also calls for limiting Pell eligibility to 125 percent of program length to encourage students to move along. In addition, eliminating “the outdated Supplemental Educational Opportunity Grant program that disproportionately benefits wealthy private institutions” would save money that could help fund Pell Grants.
The report proposes a Pell bonus for community colleges with a graduation and transfer rate of at least 50 percent. “Eligible schools could either use the additional money to reduce the net price they charge their neediest students or to create support programs to help low income students earn their degrees and transfer to four-year colleges.”
Other recommendations would redesign student loans and tax credits.
• Significantly simplifying the federal student loan system and reducing the dangers of default by requiring all borrowers to repay their debt based on a percentage of their earnings. Encouraging colleges to hold down their costs by eliminating both the Parent PLUS and Grad PLUS programs that currently allow for unlimited borrowing.
• Eliminating poorly targeted higher education tax benefits, such as the American Opportunity Tax Credit, in favor of direct aid for students.
The report also calls for strengthening accountability by “creating a federal student unit record system to provide a clearer picture of how students fare as they proceed through the educational system and into the workforce.”
Eligibility for federal student loans should be limited to 150 percent of program length to discourage prolonged enrollments, the report proposes.
Borrowers who turn to private student loans should be able to declare bankruptcy, if necessary, to clear their debts.
While the report is “wonderful and thought-provoking,” Community College Dean questions whether students can finish a two-year degree in 2 1/2 years. Very few do. Setting a tight time limit would make it hard to offer “stackable” certificates or integrate developmental instruction in mainstream courses, he adds.
Then there’s the political challenge. Capping student loans and eliminating tuition tax deductions to pay for Pell could alienate middle-class voters, he warns. “Once the middle class decides that a program is really just for the poor, that program tends to wither on the vine.”
College Completion Must Be Our Priority declares an “open letter” from the National Commission on Higher Education Attainment. “All the communities have come together — community colleges, research institutions, public universities and small liberal arts colleges — and reached agreement that completion needs to be our most important priority,” said E. Gordon Gee, the president of Ohio State and chair of the commission.
Almost half of students who enroll in a two- or four-year institution fail to earn a degree in six years, notes the New York Times.
(The report) calls on colleges and universities to find ways to give students credit for previous learning, through exams like the College Board’s College-Level Examination Program, portfolio assessments or other college equivalency evaluations. It also calls for more services and flexibility for nontraditional students, suggesting innovations like midnight classes, easier credit transfers and more efficient course delivery, including online classes.
Colleges and universities must adapt to students’ needs, said Molly C. Broad, president of the American Council on Education.
“We have policies and practices built when colleges were filled with full-time, 18- to 22-year-old students who needed to be provided not only educational opportunities, but fed, protected, counseled and given recreation,” she said. “But that’s not our world today, when the overwhelming majority are part-time students juggling jobs, older students, veterans, whom we need to treat fairly — and do it on our own rather than have it done unto us.”
A second report, The American Dream 2.0, warned that borrowers who don’t graduate are “plunged underwater financially.” The report suggests “making the financial aid application process simpler and more transparent, and holding both schools and students accountable for completion,” reports the Times.