In late August, President Obama unveiled the details of his administration’s College Affordability Plan to curb the cost of higher education. While specifics of the plan can be found on the White House’s fact sheet, we wanted to examine the broader pieces here and explore what each could mean for institutions across the country.
If you’ve been catching snippets of the plan, but aren’t sure how the fully-integrated system would work, here are its key components in greater detail:
Collect and share reliable college data. Obama’s administration is calling for the creation of new college scorecards that would include specific and transparent information on:
- Access: the number of students who are receiving Pell Grants or other forms of financial aid
- Affordability: the average tuition costs, scholarship opportunities, and loan debt loads
- Educational outcomes: the percentages of students who persist to graduation or who transfer, the average earnings of graduates, and the advanced degrees achieved by graduates
While much of this information is already public record, it takes a little digging to find it. The formalized scorecard approach would make information more easily accessible through a wider range of sources. The plan mentions that the DOE would rely on private sector entrepreneurs in the data collection business to create the apps, tools, and other resources necessary to help students compare and evaluate colleges. Of course intentions and final products are often two completely separate things, so it’s unclear if or how the private market would leverage the information directly for the benefit of students and their families.
Create a universal rating system for colleges. The data collected in the first plank of plan would be used to group similar institutions and rank them based on value, the resources they have available to help disadvantaged students, and performance. The goal of the ranking system is to help prospective students compare their options from an apples-to-apples perspective and use objective data to drive decision making.
Critics of the ranking approach point out that alternative rating systems are already in place and available to students. Typically, this information includes Pell Grant data, tuition, graduation rates, research spending, advanced degrees awarded, etc. They assert that yet another rating system would only serve to confuse consumers in exchange for marginal improvements.
Tie ratings to federal aid resources. Here, the administration’s plan takes the institutional data and rankings information and leverages it for governmental use. The plan calls for eventual legislative action that would tie federal student aid to institutional excellence. Once the rating system is fully developed, students attending highly-ranked colleges could have access to larger Pell Grants and more affordable student loans. This piece of the plan is perhaps the most revolutionary, as it adds a new dimension beyond simple accreditation to the qualifiers of receiving federal aid.
Expand income-based repayment options. The president’s plan also calls for an expansion of income-based loan repayment programs, letting new borrowers cap their federal student loan payments at 10 percent of their monthly income. Further, the plan includes outreach efforts aimed at existing borrowers who are currently behind, in forbearance due to financial hardship, or in default on their loan payments — encouraging them to select and repayment option that would fit better with their needs and situations.
Secure Race to the Top funding. Not surprisingly, the plan includes $1 billion for Race to the Top funding, which was part of the administration’s 2014 budget proposal. Race to the Top is a program designed to spur innovations in education by offering competitive grants and awards to those states that employ effective reforms and build successful educational models that could be adopted by the rest of the nation.
Incent colleges to enroll economically-challenged students. The College Affordability Plan also proposes legislation that would give bonuses to institutions based on the number of Pell Grant recipients they graduate. It would also reform the way those grant monies are disbursed — providing scaled funding over the course the semester instead of in one lump sum at the start. The goal of this disbursal approach is to avoid wasted funds that result from Pell Grant awardees who drop out early.
Link aid resources to student academic progress. Additional reforms would make federal financial aid resources dependent, at least in part, on how well students progress toward graduation. By better formalizing academic markers at the student level, the plan would sharpen the focus on student persistence and graduation rates. Critics of this point object that the parameters are too vaguely defined; understandably, they wonder if aid would be reduced incrementally or cut-off completely and if there would be a related degree completion time limit.
Explore new learning models. The Obama Administration has also expressed interest in exploring competency-based learning models and MOOCs to fulfill some graduation requirements. Under these learning models, students would be measured less on the collection of academic credits and more on ability, skill, and knowledge of the subjects they’re studying. Toward that end, Obama has proposed a $260 million First In the World fund to examine and evaluate innovative education models that produce significantly better outcomes for students. An additional $500 million in funds would be used to create affordable and accelerated learning options for adult and working students.
It’s important to note that these proposals are just that — proposals. The plan is not law and it’s unclear what next steps the administration might take to push the issue forward. As the nation faces complex issues with Syria, prepares for what many assume will be a congressional battle over the debt ceiling and budget, and continues to focus on employment numbers, this issue may be put on the backburner for months or years to come.
At Enrollment Builders, our team of professionals offers a range of consultative services designed to help schools reach and retain students, grow programs, and constructively respond to legislative and industry changes. If you’d like to learn more, please contact us at 513-518-7824 or request information here.