By Allie Arcese, Director of Communications

By Allie Bidwell, NASFAA Senior Reporter

For the third time in just a few weeks, Education Secretary Betsy DeVos made her way to Capitol Hill on Wednesday, this time to testify before the House Committee on Education and Labor on the Department of Education’s (ED) policy priorities. Throughout the more than four-hour hearing, Democrats on the committee put the pressure on DeVos to answer questions on everything from ED’s proposed fiscal year 2020 budget and borrower defense claims processing, to oversight of loan servicers, accreditation, school closures, and the recent negotiated rulemaking session.

While committee members also spent a significant amount of time discussing K-12 education issues, several pressed DeVos for answers on issues related to federal student aid, including proposals to expand eligibility for Pell Grants, reform to the Federal Work-Study program, and apprenticeship and dual enrollment programs.

DeVos in her opening remarks took time to justify proposed changes and cuts in the administration’s fiscal year 2020 budget proposal, as well as shifts that would clear more of a pathway for career training and vocational education.

“There are many paths to successful careers, and federal student aid programs should be flexible enough to support students on the path of their choice,” she said.

She also promoted ED’s efforts to streamline and simplify the process of applying for and receiving federal student aid through the Next Generation Financial Services Environment—or NextGen, for short.

“In order to effectively implement the student aid programs, we are pursuing an innovative strategy to deliver federal student aid services and information to our customers, and the budget includes strong support for this initiative,” DeVos said. “The key to the Next Gen FSA transformation will be a comprehensive, FSA-branded customer engagement layer that will create an environment where the Department’s customers will receive clear, consistent information and readily accessible self-service options at every stage of the student aid lifecycle, something I think we can all agree is worth supporting.”

She added that ED proposed eliminating both the Public Service Loan Forgiveness (PSLF) program and the Direct Subsidized Loan program as a way to “further simplify  the student loan program and take the government out of the business of picking winners and losers among students who may have the same debt and earn the same salary—simply because their employers have a different tax status or their parents had different earnings.”

“Our priorities, and this budget, reflect our commitment to spending taxpayer dollars wisely and efficiently while supporting our nation’s students of all ages,” DeVos said. “Because that’s who budgets are for—students. If this country is to remain secure, strong, prosperous, and free, we need students who are prepared to pursue successful careers and lead meaningful lives.”

Chairman Rep. Bobby Scott (D-VA) said in his opening statement that the proposed cuts to higher education are “particularly deep” and that they would “deny countless students the personal growth and economic mobility that comes with a college degree.”

“The budget is more than numbers on a spreadsheet,” Scott said. “There’s a clear message in those numbers and, regrettably, this is the same message the Department has been sending students, parents, and educators over the past two years.”

Scott also took issue with ED’s failure to respond to congressional requests for information in a timely manner. He referenced a November 2017 request for information about why ED refused to implement the Obama-era borrower defense rule, which he said lawmakers “have not received substantive responses” to. He also mentioned a November 2018 request for ED to justify reinstating the Accrediting Council for Independent Colleges and Schools (ACICS) as a federally-recognized accrediting agency.  

“Behind each of these unjustified actions and unanswered questions, there are students, parents, educators, and taxpayers across the country who are waiting for answers and only can speculate as to the reason behind the actions,” Scott said. “They deserve to know why [ED] is not acting in their best interests, faithfully executing the law, or taking seriously the federal government’s responsibility to ensure all Americans have access to a quality education, from child care and early learning to college and career.”

Rep. Virginia Foxx (R-NC), ranking member of the committee, on the other hand, commended DeVos for ED’s deregulatory agenda.

“During the Obama administration, the Department handed down a slew of regulations and federal red tape that hampered programs,” Foxx said in her opening remarks. “Since assuming office in 2017, Secretary DeVos has worked to reduce the regulatory burden on state and local leaders and has also worked to help provide flexibility where she can to help connect students with in-demand jobs.”

She also made clear the divide between Democrats and Republicans on the committee, saying that while oversight is necessary and it is important to be thorough in reviewing ED’s activities, “‘thorough and exacting’ does not mean prejudiced and pernicious.”

“Secretary DeVos, you have been unwavering in your dedication to your job in the midst of strong headwinds. I want to assure you that Committee Republicans recognize the work you are doing to connect students with effective education,” she said. “We’re grateful for your efforts, and you can expect this side of the dais to ask questions that shed light on the progress [ED] has made since you were confirmed as Secretary and your priorities moving forward.”

Much like when DeVos appeared before a House appropriations subcommittee last month, several members brought up the borrower defense regulations and questioned ED’s implementation of the 2016 rule, pressing for answers as to why ED has not approved any claims in the last several months.

Rep. Mark Takano (D-CA), for example, asked if it was true that no claims had been approved in the last several months, and DeVos responded that while it was true, the reason was due to a pending court case.

Takano continued his line of questioning, asking DeVos to explain in more detail why it was taking so long to approve claims, noting that “merely processing claims and faithfully implementing the rule are different.” He said ED has not approved or rejected claims, but has closed thousands. DeVos attempted to respond, saying this was due to addressing closed school discharges, but could not finish her response.

Takano then asked if DeVos or any of her political appointees had instructed ED career staff to “focus on prioritizing the closing of claims over approving them.”

“On the off chance that your department were to ever approve a student claim, isn’t it true that if the school has closed, the taxpayers are liable and not the school?” he asked. “However, if a school is still open, [ED] has the ability to begin processing the recovery. Knowing this, a reasonable and prudent person might posit the idea that your department may have the perverse incentive to intentionally delay the implementation of the borrower defense rule to protect the financial interests of these for profit institutions and their investors.”

DeVos responded, saying that ED is implementing the rule “as ordered to do,” and added that the agency is also “in the process of continuing to refine the rule” because the administration does not agree with how it was written.

The committee also spent much time discussing the Pell Grant program and the administration’s proposal to extend eligibility for students to use their grants at short-term, high quality programs.

Rep. Elise Stefanik (R-NY) asked how expanding Pell eligibility could help with completion rates.

DeVos said that it would be “an excellent move” to extend Pell eligibility and that ED would work with Congress to provide guardrails to ensure quality.

“We know there are many jobs available today that require just a short-term kind of program and yet we’ve been very rigid in terms of how we viewed the use of Pell funds,” DeVos said.

Not long after, Rep. Alma Adams (D-NC) said that while expanding Pell is a worthwhile idea, funds for the program also need to be expanded.

“If you stretch it out and we don’t put the additional dollars in, that doesn’t help very much, but it’s certainly an opportunity for students to do better,” she said.

Adams went on to question DeVos about proposals that would consolidate programs that Adams said would harm Historically Black Colleges and Universities (HBCUs), asking why ED would cut funding for more vulnerable institutions with a historical mission while “continuing to prop up low-performing and unscrupulous for-profits.” She went on to piggyback on questioning from Rep. Suzanne Bonamici (D-OR) on the decision to reinstate ACICS.

Adams went on to ask DeVos if she knew that less than one month after ACICS was reinstated, a large for-profit chain it accredited collapsed. DeVos said repeatedly throughout the hearing that ED was instructed through a court ruling to reconsider 36,000 pages of documentation that was overlooked in the initial decision.

“Let me just say that the answers you’ve provided reveal a fundamental lack of concern for the tens of thousands of students that were taken advantage of because of the shoddy oversight,” Adams said. “I think it would be nice if we had a department that put students first, particularly students who view higher ed as their ticket out of poverty.”

During her time for questions, Foxx turned to PSLF and the criticism ED has received with regard to implementation of the program and the struggled borrowers have faced in obtaining loan forgiveness. But in her questioning, Foxx turned to the Obama administration’s actions.

“Is it true that Congress set the terms and conditions borrowers must meet?” she asked. “Is it true that the previous administration had eight years to issue clarifying guidance? … Is it true that the previous administration had eight years to spread the word about the requirements?”

She also suggested questioning on negotiated rulemaking had been unfair in insinuating that ED had “stacked the deck” against students.

“Is it accurate that the negotiated rulemaking process was established by Congress?” Foxx asked. She went on to say the panel included both a student representative, a state representative, and a consumer advocate “each with their own vote” and that a state attorney general was able to participate through a subcommittee.

Foxx closed out the hearing saying the committee “could use a working definition of accountability, since that’s the entire premise behind having an agency official testify.”

“Accountability is asking the official a tough question and listening for the answer before deciding they’re wrong. It’s not grilling the witness and talking over them the moment you don’t hear what you wanted to hear,” she said. “My Democratic colleagues have tried for the better part of four hours to twist your words out of context. After doing so they did not allow you to respond and instead filled the time with what they wanted to hear. This is a ‘gotcha’ hearing, not an honest attempt to learn how the government can better serve students. The arrogance exhibited in this committee today has been breathtaking. Indeed rarely have I heard so many people tell you how to do your job and say they know how to do it better than you do.”

Publication Date: 4/11/2019

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