Federal Relations

August 22, 2013

White House Releases Higher Education Proposals

As part of the college road show President Obama is undertaking starting today, the White House has released a fact sheet on a series of proposals that the Administration will be promoting on higher education. Some of these proposals require legislative action by Congress, while some can be instituted by the Administration. Other proposals by the Administration urge colleges to take action. The set of proposals focuses on three main areas:

Using Outcome Measures to Guide Student Aid Awards and Funding to Colleges

This area encompasses several proposals, most of which are built off of expanding the Administration’s reporting under their college scorecard:

  • Expands the current college scorecard by the 2015 school year to include things like the percentage of student receiving Pell Grants, average tuition, loan debt of students, graduation and transfer rates and earnings of graduates. The fact sheet implies the Department of Education can take these steps unilaterally but the collection of some data by the Department such as graduate earnings could be problematic given current restrictions on student level data collection in the Higher Education Act. 
  • Seeks, by 2018, to tie the rating system to student aid awards by providing students attending high performing colleges with larger Pell Grants and “more affordable student loans.” The 2018 element of this proposal would require legislative action by Congress.
  • Reiterates the call for the Administration’s College Race to the Top proposal, first made as part of their 2014 budget, and calls for bonuses to be paid to colleges based on the number of Pell recipients they enroll. This would require legislative changes.
  • Requires students to complete a certain percentage of classes before receiving their full student aid (Pell Grants and loans) allocation – there is not a great amount of detail on this, but it seems to imply that Pell Grants and loans may be available for schools to draw down in some sort of installments based on completion of classes by students. This would require legislative action by Congress.

Challenging Colleges to Further Innovate

This area largely seems focused on encouraging colleges and others to do what some are already doing by calling for a greater focus on competency-based education, expansion of Massive Open Online Courses (MOOCs), expanding e-advising and other student services and encouraging dual enrollment. The Administration reiterates its support for its First in the World proposal (from its last few budgets) and the last installment of the Trade Adjustment Assistance Community College funding. The Administration also focuses on the experimental sites authority saying they will encourage “high-quality, low-cost innovations” including offering Pell Grants to high school students taking college courses and credit for prior learning. Other than seeking funding for the First in the World initiative, none of this would seem to require legislative action by Congress and some of it is just calling on actions by schools and others.

Addressing Student Debt

The Administration reiterates its proposal to expand Income-Based Repayment (IBR) to all students (regardless of when they might have first borrowed) to cap loan payments for borrowers under the program to 10 percent of their monthly income. This proposal was also made by the Administration as part of their solution to the recently enacted student loan interest rate issues. The Department of Education will also take on an outreach effort to educate borrowers about IBR. The expansion of IBR would require legislative changes.

Sources: White House, Penn Hill Group