House and Senate votes clears bill for President Bush's signature to provide first comprehensive overhaul of HEA in a decade

The full House overwhelmingly approved legislation to reauthorize the Higher Education Act by a 380 to 49 vote today. Hours later, the Senate easily passed the bill, the Higher Education Opportunity Act, by an 83 to 8 vote, with 1 Senator voting present.

Today's action by the House and Senate clears the bill for President Bush to sign into law and will be the first complete reauthorization of the HEA since 1998.

Democrat and Republican education leaders in Congress heralded the long-awaited legislation, which will provide additional financial aid for students. The law will also require higher education institutions and loan providers to provide a host of new disclosures to help students and parents make better-informed decisions about higher education and higher education financing.

"Today's students face daunting obstacles on the path to college, from skyrocketing tuition prices to predatory student lending tactics. This landmark bipartisan legislation will address these challenges and create a higher education system that is more consumer-friendly, fairer, and easier-to-navigate," said House education committee Chairman George Miller (D-CA).

"This bill ... puts quality information in the hands of consumers and takes meaningful steps to hold down the college cost increases that are threatening students' ability to pursue their higher education dreams," said the committee's Senior Republican Howard "Buck" McKeon (R-CA). "I applaud today's bipartisan vote, and look forward to this bill's swift enactment."

However, not all lawmakers were as optimistic about the bill. Former U.S. Department of Education Secretary and current Sen. Lamar Alexander (R-TN) said he opposed the bill because, ironically, the same bill created to lower college costs would actually increase college costs by significantly increasing institutions' administrative costs.

"Congress has spewed forth a well-intentioned bill that will ultimately waste time and money that should be spent on students," Alexander argued. "The greatest threat to higher education is not under-funding, it's over regulation."

Alexander illustrated his point by standing next to boxes filled with all the current higher education regulations that stood nearly as tall as he did.

"This legislation would double these regulations adding 24 new categories and 100 new reporting requirements," Alexander said.

The reports required by the new bill will be too confusing for families to understand and leave thousands of college administrators scratching their heads, Alexander argued. "As a former Department of Education Secretary I don't know who will read all these new reports," he said.

Sen. Barbara Mikulski (D-MD), who has stood in for Senate education Chairman Edward Kennedy (D-MA) who is absent with health issues, recognized Alexander's concerns and said she hope to work with him to address these concerns and see if Congress could eliminate duplicative and ineffective federal mandates for institutions.

The NASFAA leadership and staff know how critical this new legislation is to your operations, your institution, and your students. We are already analyzing the final legislation passed by Congress to provide the thorough, insightful, analysis from the aid administrator's perspective that only NASFAA can give you.

• Early next week, Today's News will feature a section-by-section outline of important changes found in the Act.

• Also next week, NASFAA Members will receive a letter with sample language that you can adapt and use to inform senior members of your administration about the potential impact of various sections of the legislation on your institution.

• In the coming weeks Today's News will run "NASFAA HEA Analysis" - a series of in-depth and specific issue articles examining individual provisions affecting your operations and students.

• On August 21, we will hold a Webinar - which you, your staff, and others on your campus can attend free of charge - addressing a number of the immediate implementation issues you need to consider and other questions about the new legislation. Details about the Webinar, which will also be recorded and available online for several weeks following the event, will appear in Today's News shortly.

• NASFAA also intends to offer additional training opportunities about the new law in the future.

Resources

• Press Release and Summary from House education committee Chairman George Miller (D-CA)

• Press Release and Summary from Senate education committee Chairman Edward Kennedy (D-MA)

• Press Release and Summary from House education committee Ranking Republican Howard "Buck" McKeon (R-CA)

• Press Release and Summary from Senate education committee Ranking Republican Michael Enzi (R-WY)

• Text of Higher Education Opportunity Act

• Joint Explanatory Statement Of The Committee Of Conference

• Letter from NASFAA President to Congressional Education Leaders Expressing Support and Concerns

Summary of the Higher Education Opportunity Act Summary of the Higher Education Opportunity Act
Based on a Summary from the Office of Senator Edward Kennedy

College and Textbook Costs

• Provides more transparency about college costs by requiring the Department of Education to publish detailed data about college pricing trends on its Web site.
• Requires the top 5% of colleges that have the greatest cost increases over three years for their sector to submit detailed reports to the Secretary of Education explaining why their costs have risen, and what steps they will take to hold costs down.
• Requires textbook publishers to "unbundle" materials so students can purchase only those materials they need for their classes, and requiring colleges to make more detailed information about textbooks available on their online course catalogs.

Federal Financial Aid Application Process

• Immediately creates a new 2-page EZ-FAFSA for low-income students, and requires phasing out the current 7-page FAFSA for all applicants within 5 years.

• Initiates a pilot program to find with new ways to further simplify the financial aid application process. The pilot will allow students to receive an aid determination or estimate in their junior year of high school, and encourage the Department of Education to work with the IRS to share tax data that can be used to pre-populate students' financial aid application forms.

Ethics and Transparency in the Student Loan Sector

• Includes provisions that prohibit lenders, guaranty agencies, and colleges from offering or accepting payments, gifts, and other inducements as a condition of making student loans.

• Requires colleges to establish and follow a code of conduct with respect to student loans.
• Requires colleges that identify "preferred lenders" to place at least three lenders on the list, and clearly explain to students why the college believes the lender is offering attractive terms and conditions.
• Creates a student "self-certification" process for non-federal private educational loans, to ensure that students maximize low-cost federal aid first and prevent students from borrowing more private loans than they need to cover the cost of college.
• Requires lenders to guarantee the terms and conditions they offer to a prospective private education loan borrower for 30 days after the borrower's loan application is approved, and allows borrowers to cancel a private education loan, without penalty, within three days after the loan is consummated.

Aid for Military Veterans and Their Families

• Allows service members to defer payments, interest-free, on Federal Direct Loans while they are on active duty.
• Provides in-state tuition for members of the Armed Forces and their dependents who have lived in a state for more than 30 days.
• Enables U.S. students who leave their college for military service to re-enroll easily when they return.
• Ensures that military benefits do not count against service members' eligibility for federal grants and loans to pay for college.
• Provides new college scholarships for children and family members of service members who have died since 9/11.
• Creates a new on-line clearinghouse for service members to learn about the college benefits available to them.

Grant Aid for our Needy Students

• Increases the Federal Pell Grant maximum from $4,800 to $6,000 for 2009 and to $8,000 for 2014.
• Allows low-income students, for the first time, to receive Pell Grants year-round, to help them accelerate the completion of their degrees.
• Creates the Grants for Access and Persistence (GAP) program, a new matching grant program to allow states to increase need-based grant aid to students.

TRIO and GEAR UP

• Expands required activities in the TRIO programs, with a special focus on improving students' financial and economic literacy.
• Requires the Secretary of Education to measure the quality and effectiveness of TRIO programs more rigorously, and requiring a comprehensive evaluation of the Upward Bound program to be implemented by 2010.
• Creates new due process provisions to ensure that TRIO program applicants are assessed fairly and accurately.
• Enables GEAR UP programs to offer early intervention and other activities, including extended school day programs, encouraging student enrollment in challenging secondary coursework, professional development, and dropout recovery.

Aid for Students with Disabilities

• Permits students with certain intellectual disabilities to receive Pell Grants, FSEOG, and Federal Work Study under certain circumstances for the first time.
• Creates a new program to expand the number of postsecondary programs for students with intellectual disabilities.
• Supports model demonstration projects to make college course materials more accessible for students with print disabilities.
• Establishes a National Technical Assistance Center at the Department of Education to support all efforts to enhance the participation of students with disabilities in higher education.

Teacher Preparation Programs

• Promoting innovative and effective teacher preparation programs for new and prospective teachers, including effective preparation, induction, and residency programs.
• Creates a pipeline for high-quality teachers to teach in high-need schools by promoting partnerships between teacher education programs and high-need districts.
• Holds institutions of higher education accountable for the quality and progress of their teacher preparation and alternative certification programs.

Expanding and Strengthening Nursing Faculty

• Creates a new capitation grant program to help nursing schools enroll more students.
• Authorizes funds for nursing schools to improve and strengthen their faculty.

By Haley Chitty
NASFAA Associate Director of Communications

Posted 07/31/08 to www.NASFAA.org. Redistribution to non-NASFAA institutions is prohibited. Please submit Web Site questions or comments to Web@NASFAA.org.