Representatives of various sectors of the higher education community met with U.S. Department of Education officials yesterday in Washington, D.C. to discuss upcoming negotiated rulemaking for the recently passed Higher Education Opportunity Act (HEOA).
Higher education representatives asked the Department to provide regulations that will accommodate every type of higher education institution, provide flexibility so institutions can effectively pursue their unique missions, and provide a way for institutions to make a smooth transition from current to new regulations so students don't experience any disruptions.
Testifying before the Department officials, NASFAA President and CEO Dr. Phil Day noted that the HEOA advances the goals of the federal student aid programs in many ways, but also presents challenges that require careful analysis and a deliberate plan of action to effectively implement.
Day asked the Department to:
- Regulate only where necessary
- to ensure understanding of and compliance with the law, and
- to preserve the integrity of the student aid programs
- Negotiate all regulations that impact institutional operations or student decisions
- Allow institutions to focus resources on serving students rather than feeding an insatiable but meaningless data machine
- Consolidate and standardize disclosures to avoid confusing students and families
- Take a wide view towards provisions that encourage families to think early of higher education as an attainable goal
Day was also critical of the many, new reporting and disclosure requirements in the new law.
"In its approach to reporting and disclosure requirements, the HEOA takes a shotgun approach, asking institutions to produce as much data as possible without any clear or meaningful purpose," Day said. "Unless carefully orchestrated, the effort required to comply will divert resources and detract from the time schools would otherwise focus on services that more effectively help students."
Day said that disclosures to students should be:
- coordinated;
- unduplicated unless absolutely necessary for comprehension; and
- at the very least, consistent.
The amount of reporting and disclosure requirements in Title I and X of the new law prompted higher education representatives to ask the Department to include these titles in the negotiated rulemaking process, even though it is not required for these titles.
Regarding provisions that dictate permissible relationships between lenders and colleges, Dr. Day urged the Department to make it clear that federal requirements take precedence over state and local jurisdictions and provide further clarity about how institutions can legally collaborate with lenders to educate students about loans, debt management and financial literacy.
Day also advocated for the Department to consider simplifying the Expected Family Contribution formula by testing a "prior prior year" basis for need analysis along with an IRS database match.
A representative of the National Association of State Student Grant and Aid Programs (NASSGAP) also expressed some concern about the Department's plan to simplify the FAFSA. She indicated that simplification must be balanced with the ability to effectively identify a student's need for aid. Simplifying the FAFSA too much could lead to students being required to fill out additional applications for state aid programs, she said.
"Simplifying the application must be an open process and include all concerned parties to ensure everyone's needs are met," the NASSGAP representative said.
Many representatives of the for-profit higher education sector also testified at the HEOA meeting. They urged the Department to provide flexibility for institutions to determine what percentage of funding comes from the federal government to comply with 90/10 provisions. The 90/10 provisions require that at least 10 percent of an institutions funding comes from nonfederal sources. Increases in Pell grant and Stafford Loan limits threaten to push some institutions over the 90 percent threshold. For-profit representatives provided several ways that the department could provide some relief for these institutions so they will not be disrupted by changes.
Speakers testifying on behalf of higher education institutions also expresses concern about the new Cohort Default Rate (CDR) provision which will measure defaults over a longer repayment period. They urged the Department to provide flexibility for intuitions to comply with CDR requirements and to not penalize institutions unnecessarily. They argued that CDRs are not always a good indication of the quality of an institution and other factors like the economy often have a bigger impact on defaults.
NASFAA's complete written testimony is available online.
Dr. Day's testimony is also available online.
Posted 10/09/08 to www.NASFAA.org. Redistribution to non-NASFAA institutions is prohibited. Please submit Web Site questions or comments to Web@NASFAA.org.
