Government Relations Archive

Reauthorization of the Higher Education Act

The second session of the 110th Congress began recently and it appears as if the House will be bringing up its version of the reauthorization of the Higher Education Act sometime during the week of February 4.

These are the issues that independent colleges and universities are most concerned about in the House’s version of the bill:

College Cost – the bill would establish the Higher Education Price Index and would create a federal Price Increase Watch List for any college whose sticker price exceeds a federally-prescribed pricing index.

The National Association of Independent Colleges and Universities (NAICU) reports that it is unlikely any modifications will change this provision of the bill.

Accreditation and Student Learning Outcomes – the bill’s language mirrored the language in the Senate bill with colleges setting their own standards for student learning. This protective language was eliminated in the House bill at the request of certain accreditors.

NAICU reports that the accreditors, the Council for Higher Education Accreditation (CHEA), and the higher education associations have agreed on compromise language that, hopefully, will be included in the final House bill.

Teacher Education – the bill would require all colleges in the country to follow several federally-prescribed curriculum elements. This would create a precedent of using a college’s participation in federal student aid programs as a means of prescribing a curriculum in a particular field of study.

NAICU reports that this is driven by No Child Left Behind concerns on accountability and that key members of the House may accept softer language – but not do away with the federal mandate.

Articulation Agreements – the bill would call for the development of statewide articulation agreements and it is unclear if all institutions would be required to participate in them.

NAICU reports that they have been told that the House bill will be modified to include clarifying language acceptable to independent colleges and universities.

Reporting – the bill would add numerous new reporting requirements that would be very costly to colleges. It was recently reported in the Chronicle that one reason the bill contains so many new requirements is that “the renewal of the Higher Education Act is five years overdue. As a result, there is a built-up demand for more reporting and record-keeping.”

NAICU reports that there is “no relief in sight.” The new reporting requirements being proposed are important to the members who developed them and the burden on institutions is simply not a priority.

Last Dollar – the bill would require GEAR UP and three other new federal scholarship programs to be the last grants given in a student’s financial aid package. This means institutional aid will be packaged before these additional dollars are awarded. Not only does this complicate the packaging, but it also allows federal program reviewers to oversee how a college awards its own aid.

NAICU reports that these concerns are being heard and should be addressed in the final House bill.

Other News

Sen. Max S. Baucus (D-MT) and Sen. Charles Grassley (R-IA) who are Chair and Ranking Member of the Senate Finance Committee have sent a detailed letter to 136 institutions requesting information about their endowment spending, financial aid policies, and tuition increases over the past decade. This came about when an annual report was released that showed in FY 2007, college endowments enjoyed their biggest investment gains in nearly a decade.

Just before the holidays, and after a veto of the education appropriations bill by President Bush and two omnibus bills that never moved, Congress finally passed H.R. 2764, the FY 2008 omnibus appropriations bill on December 19.

Congress had to cut $22 billion from its preferred spending level in order to move the bill and ensure that President Bush would sign it. To meet this goal, the bill makes a 1.7 percent across-the-board cut, which is applied to all programs and projects except for the Pell Grant program. The Pell Grant program is funded at $14.215 billion and with the funding from reconciliation, the total maximum grant increases to $4,731 – a new high.

Other student aid programs were cut and the funding levels are below:

SEOG (Supplemental Educational Opportunity Grant) – $757.465 million
FWS (Federal Work Study) – $980.492 million
Perkins Cancellations – $64.327 million
LEAP – $63.852 million
TRIO – $828.178 million
GEAR UP – $303.423 million
Javits (Fellowship Program for study of the arts, humanities, and social sciences) – $9.530 million
GAANN (Graduate Assistance In Areas of National Need) – $29.542 million

These cuts signify level funding for TRIO and GEAR UP, a slight increase for FWS, and funding levels below last year for SEOG, Perkins, LEAP, and the graduate programs.

The reauthorization of the Higher Education Act (HEA) will be considered on the House floor sometime this month. The slowdown in floor consideration will, hopefully, mean further improvements to the bill for independent colleges and universities.

Unfortunately, Congress failed to renew the IRA charitable rollover and tuition deduction tax benefits which expired on December 31. According to House and Senate staff, the expiring provisions will be extended and made retroactive to January 1.

The National Association of Independent Colleges and Universities (NAICU) has reported that colleges and accreditors have recently reached a compromise on language to propose to Congress. Representatives of both groups will now try to convince Congress to amend the House HEA reauthorization bill to include the compromise language.