Legislative Activity

Alternative Accreditation Proposal

In a speech at the Heritage Foundation on October 29, Sen. Mike Lee (R-UT) unveiled his plans to introduce the Higher Education Reform and Opportunity Act next week. The proposed legislation would provide a new option for states to create alternative accreditation systems while also keeping the existing system of accreditation most institutions currently use. The bill would authorize a new optional state system, which would make accreditation – and federal financial aid – available to specialized programs, individual courses, apprenticeships, professional credentialing, online courses, and competency-based tests.

Higher Education Act Reauthorization

Deregulation Working Group

During the Senate Health, Education, Labor, and Pensions (HELP) Committee’s second hearing in the Higher Education Act (HEA) reauthorization series held October 31, Ranking Member Lamar Alexander (R-TN) stated that he has formed a bipartisan working group with Sens. Barbara Mikulski (D-MD), Richard Burr (R-NC), and Michael Bennet (D-CO) to focus on the deregulation of higher education. The group is seeking specific recommendations to reduce red tape that prevents institutions from experimenting with practices which reduce costs and enhance student learning. The group is working with select universities and the American Council on Education to review specific proposals. Deregulation is likely to be a topic for a future hearing in the series.

Additional Hearings

We expect the next HEA hearing in the HELP Committee reauthorization series to cover issues related to access in higher education, as the Committee is currently seeking witnesses to testify on the topic. That hearing could occur as early as next week.

Simplifying Student Aid

House Education and the Workforce Committee Chairman John Kline (R-MN) sent a letter to Secretary of Education Arne Duncan asking for legislative recommendations to streamline the processing of the Servicemembers Civil Relief Act benefits related to lowering interest rates on student loans active duty military members. The Subcommittee on Higher Education and Workforce Training will likely follow up on this issue when it reschedules its hearing on simplifying federal student aid.

Higher Education Tax Credits

Two proposals introduced last week would streamline tax credits related to higher education costs. A bill introduced by Rep. Allyson Schwartz (D-PA) would overhaul the American Opportunity Tax Credit (AOTC) to front-load the credit so that students and families can receive the money more quickly and receive a larger benefit. Another proposal introduced by Reps. Diane Black (R-TN) and Danny Davis (D-IL) would consolidate four existing education tax credits into a more comprehensive AOTC.

Upcoming Hearings:

  • Monday, November 4: The Economic Opportunity Subcommittee of the House Veterans’ Affairs Committee will hold a hearing titled “Examining Higher Education Institutions’ Services to Veterans.”
  • Wednesday, November 6: The Senate Commerce, Science and Transportation Committee will hold a hearing concerning the reauthorization of the America Creating Opportunities to Meaningfully Promote Excellence in Technology, Education, and Science (COMPETES) Act.

Regulatory Activity

College Affordability

Public Meetings

The Department of Education (Department) will host four public meetings for education stakeholders to provide feedback and input on the Department’s college affordability proposal.  The public meetings will take place on:

  • Wednesday, November 6 at California State University
  • Wednesday, November 13 at George Mason University
  • Friday, November 15 at the University of Northern Iowa
  • Thursday, November 21 at Louisiana State University

Stakeholders may share their views on the proposal at the public meetings and submit comments to collegefeedback@ed.gov.

Department of Education Proposal

Secretary Duncan has committed to completing a draft of the Department’s college rating proposal by spring.  The ratings system, as proposed in President Obama’s August “Plan to Make College More Affordable,” would “measure college performance … so students and families have the information to select schools that provide the best value.” After establishing the ratings system, which would be based on affordability, access, quality and value, the Administration wants Congress to tie federal financial aid to college performance. Four public hearings have been announced for November, and the Department plans to seek further input through a variety of venues through December. Additionally, the Department is expected to issue a formal request for input from data experts soon, which will be followed by a technical symposium with some of the experts at the beginning of 2014.

Student Loans

On November 1, the Department published in the Federal Register final regulations affecting programs including the Federal Perkins Loan Program, Federal Family Education Loan Program, and the William D. Ford Federal Direct Loan Program. One of the changes from the proposed rule is that the Department no longer allows loan servicers to determine payments for defaulting or delinquent borrowers in the loan rehabilitation process. Under the final rule, these borrowers can make monthly payments that total up to 15 percent of their discretionary income, which will not count under the Income-Based Repayment (IBR) plan. This means that loan rehabilitation payments under the 15 percent formula do not count toward loan forgiveness under the IBR plan and do not count as qualifying payments for public service loan forgiveness in the Direct Loan Program. The final rule also ends wage garnishments after a borrower completes five months of payments. The final regulations take effect on July 1, 2014.