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House Finalizing HEA Renewal and Update

December 13, 2007

With just days left in this session of Congress, it appears unlikely that the full House of Representatives will vote on legislation to renew and update the Higher Education Act (HEA). In mid-November, House Education and Labor Committee Chairman George Miller (D-CA) furthered the effort by introducing the "College Opportunity and Affordability Act of 2007."  Following the act’s introduction, committee members spent two days reviewing the legislation and debating proposed changes. Ultimately, whatever legislation is approved by the House will have to be reconciled with legislation that has already passed the Senate.

In releasing the legislation, Chairman Miller focused his comments on rising college tuitions, saying: "Today’s students face far too many obstacles when trying to go to college--skyrocketing college prices; an absurdly confusing financial aid application; and a student loan industry overrun with conflicts of interest." His comments were largely echoed by the senior Republican on the committee, Rep. Howard "Buck" McKeon.

Like prior versions of this legislation--and companion legislation already passed by the Senate--the House bill would require greatly increased reporting about how colleges spend their money. The bill would also create "Higher Education Price Increase Watch Lists," citing institutions that increase their tuitions above certain levels. Under the House bill, watch-list institutions would be required to assemble a "quality efficiency task force." Their charge: to analyze the ways in which the institution is operating "more expensively [than its peers] to produce a similar result" and develop ways to cut the institution’s costs.

The bill would also offer a "carrot" by allowing increased Pell Grant aid to colleges that kept tuition increases low. For the first time, the bill includes a requirement that the states maintain their financial support of higher education. The bill would authorize the Department of Education to withhold funding to states that cut their college spending.

In other areas, the legislation would:

  • require institutions to (a) develop  plans for giving students legal ways to download movies and music and (b) explore technologies to stop illegal peer-to-peer file sharing;
  • create a new federal "ombudsman" to intervene in disputes related to accreditation;
  • give the Department of Education significantly more authority to regulate private student loans;
  • set a $9,000 ceiling on the maximum Pell Grant and allow students to receive Pell Grant funds year-round, instead of during only the traditional academic year;
  • modify the Academic Competitiveness Grant Program, including (a) making the much-maligned grants for low-income students available to part-time students and those seeking certificates as well as degrees and (b) clarifying that the states, and not the federal government, are responsible for determining whether high school programs are of sufficient academic rigor to qualify students for the grants;
  • mandate that (a) colleges publish the ISBN (international standard book number) for all books in their course schedules to help students shop for books more cost effectively and (b) publishers expand the information they provide to faculty members about pricing and changes from past editions;
  • make changes designed to simplify the process by which students can qualify for federal financial aid and obtain information about their financial aid awards;
  • establish a loan fund to help institutions that suffer damage or other impairments by natural disasters, such as Hurricane Katrina;
  • extend forgiveness of Stafford Loans to graduates who become state or local prosecutors, public defenders, or other designated professionals;
  • expand significantly the categories of professions that are eligible for forgiveness of Perkins Loans;
  • require institutions to annually submit to the education secretary a fire safety report, including statistics on the number and cause of fires, the numbers of injuries and deaths, and the value of property damage; and
  • direct the Secretary of Education to conduct a study on the amounts, uses, and public purposes of the endowments of institutions of higher education.

The bill would also codify many of the conflict-of-interest rules advocated by New York Attorney General, Andrew M. Cuomo, as part of his office’s investigation into the financial arrangements between colleges and lenders. The bill would bar lenders from using an institution’s mascot or logo in its marketing materials and require colleges to develop codes of conduct governing their relationships with lenders.

NACUBO CONTACT: Matt Hamill, senior vice president, advocacy and issue analysis,