Thorny Higher Education Issues to Confront Next Congress

When the curtain is drawn on the 114th Congress, lawmakers in both chambers—and on both sides of the aisle—are expected to tackle a reauthorization of the Higher Education Act, a mammoth law that includes college-preparation programs for disadvantaged students, tuition-assistance grants for low- and middle-income families, and the entire federal student-loan program.

The law was last updated in 2008, but since then, tuition has been on a steady climb, student-loan debt eclipsed $1 trillion, and states have been disinvesting in their higher education systems.

Efforts are already underway in the U.S. House of Representatives, where lawmakers ushered three measures through the chamber in July with significant bipartisan backing, and in the Senate, where Sen. Tom Harkin, D-Iowa, the chairman of the education committee, who retires in January, unveiled a 700-page reauthorization discussion draft in June.

Meanwhile, lawmakers from both parties are flooding their respective education committees with myriad higher-education-focused proposals, hoping to put their own policy stamp on a major piece of legislation next year. And though hundreds of higher-education-related bills have been filed over the past year, only a fraction of them deal with issues that directly affect aspects of readiness and college access of most concern to the K-12 community.

Federal Loans

Overhauling the federal student-aid system, of keen interest to parents, students, principals, and college counselors, will be the most difficult part of the higher education overhaul, observers point out.

“There is a lot of desire to restructure the federal aid program from both sides of the aisle, but many of those things cost money, and paying for them will be a challenge,” said Ben Miller, a senior policy analyst at the New America Foundation, a nonpartisan think tank in Washington.

That might be one reason why, while many lawmakers have broad policy blueprints that outline how they would like to reorganize the system, few have actually filed bills to that effect.

Indeed, Rep. John Kline, R-Minn., the chairman of the Education and the Workforce Committee, has an 11-page guide to his reauthorization priorities, which include a proposal to consolidate all existing undergraduate federal student loans into one loan and all existing federal grants into one grant. So far, however, there’s no bill language available for the proposal.

Sen. Harkin’s discussion draft proposes streamlining loan and repayment options but isn’t a finalized proposal.

Comprehensive Measure

The most comprehensive plan to date is from Sens. Lamar Alexander, R-Tenn., the ranking member on the education committee, and Michael Bennet, D-Colo., which would combine two federal grant programs into one Pell Grant program and reduce the six different federal loan programs into three: one for undergraduates, one for graduates, and one for parents.

The measure would also eliminate the cumbersome student-aid application, increase financial-aid counseling, reinstate the year-round Pell Grant, and streamline current loan-repayment plans into two: an income-contingent plan and a 10-year repayment plan.

Still, while there is draft language of the Alexander-Bennet proposal, the duo has yet to file a bill.

Democrats and Republicans alike also have filed bills to increase financial-aid counseling and streamline the student-aid application form, both of which are expected to be included in a final legislative overhaul.

“People don’t all agree on the exact best methods and what information should be given to students, but there is a fair amount of interest from everybody about providing a greater degree of transparency and more advising,” said Mr. Miller of the New America Foundation.

Pell Grant Challenges

One of the most difficult parts of restructuring the federal student-aid system, higher education experts predict, will be putting the Pell Grant program, which provides tuition assistance for low- and middle-income families, back on solid financial footing.

The quasi-entitlement program, which is funded through both discretionary and mandatory spending, was stretched thin during the recession because of the number of people going back to earn degrees. At one point, it faced a shortfall of $13 billion.

“Because of its structure, you can’t be confident in how much money you’re going to need over a long period of time,” Mr. Miller explained.

The grant’s funding crisis subsided as the economy improved, “but if the economy suddenly tanks again and a million more low-income kids suddenly go to college, we’re in a worse position than we were a few years ago,” he said.

Although lawmakers have yet to introduce any bills to restructure the grant program, members from both parties have introduced measures to reinstate the year-round Pell grant that covers tuition for students enrolled in summer courses. Lawmakers eliminated that benefit in 2011 to make up for the grant’s massive funding shortfall.

Disadvantaged Youths

Lawmakers also have introduced a smattering of proposals to ensure higher education access for disadvantaged students.

Sen. Patty Murray, D-Wash., for example, filed a bill that would ensure homeless students and those in the foster-care system have access to higher education opportunities. Among other things, the bill would require programs that serve disadvantaged students to accept homeless and foster-care youths even if they’re unaccompanied by a parent or can’t produce the record normally required to enroll.

Among those that could be affected: TRIO, a slate of programs that help low-income and first-generation students and those with disabilities to progress through the academic pipeline from middle school through college.

Rep. Kline’s blueprint for reauthorizing the higher education law includes a proposal to assess the effectiveness of TRIO programs and provide incentives for states, local communities, and institutions to invest in TRIO-like programs, rather than increasing funding from the federal side. Those ideas, however, have yet to be put into legislative language.

Democrats in both chambers, meanwhile, have filed dozens of bills seeking to tighten regulations on the for-profit college industry, which has been making headlines for the past few years because some institutions are saddling students with unmanageable amounts of debt and misleading them about the quality of the degree or certificate programs they offer.

Republicans have proposed bills aiming to protect for-profit colleges, arguing they offer nontraditional students, including first-generation students and single mothers, the flexibility to enroll in night or online classes. Many of their proposals seek to prevent so-called “gainful-employment” rules, such as those the U.S. Department of Education issued last week.