Panelists from Varying Institution Types Discuss Outstanding Issues in Higher Ed

By Joelle Fredman, NASFAA Staff Reporter

A panel of financial aid and enrollment management experts from both for-profit and nonprofit institutions of varying sizes and population types gathered in Virginia Thursday to discuss issues in higher education related to access, accountability, transparency, and affordability, in front of a room of key players in the education finance and student loan industries.     

Throughout the discussion, hosted by the International Institute for Business Information & Growth (iiBIG) as part on its 10th Annual Education Finance & Loan Symposium, panelists shed light on the challenges facing students and institutions today, touching on provisions included in the House Republicans’ bill to reauthorize the Higher Education Act (HEA) and issues raised as the Senate works to draft its legislation.

Panelists and Forward50 members Chuck Knepfle, the associate vice president of enrollment management at Clemson University, and Bob Collins, Western Governors University’s vice president of financial aid, kicked off the discussion with differing views on how to increase affordability for students.

Knepfle, representing a public land-grant university with a population of around 25,000 students, argued states have played a major role in driving up the cost of college and that they need to play an equal role in keeping college affordable, stating that “it would be hard to make an argument that the general affordability conversation didn't start with disinvestments from states.”

Knepfle explained that Clemson University keeps the cost of tuition down for its in-state students by charging out-of-state students higher tuition rates to make up for the difference between the tuition they offer in-state students and the actual cost of educating each student. He also highlighted and applauded other state initiatives to increase affordability in higher education, such as a bill introduced just this week in the South Carolina legislature that would provide public universities a pool of funds for each in-state student it enrolls if it agrees to freeze tuition for one year and raise tuition at a maximum of 2.57 percent in subsequent years for those students.

Collins, however, coming from a private nonprofit, online university serving students with an average age of 35 and already some form of postsecondary education, argued that institutions have a large role in ensuring that college remains affordable and that students are not saddling themselves with large amounts of debt to fund their education. He explained that such efforts do not need to rely on new legislation or regulations. In fact, Collins told the room that his university was able to reduce its students’ annual borrowing by 40 percent just by encouraging students to borrow only for the direct costs of attending college.

“It’s behavioral economics,” Collins said. “It’s all in the way we framed it and presented the information.”

On the topic of accountability, despite the differences in institution type, both Knepfle and Collins were wary about the concept of “risk-sharing,” warning that utilizing certain accountability metrics to judge institutions’ quality, such as cohort default rates, may lead to institutions rejecting the neediest and most risky students. Knepfle warned that “as a country, we are going to be in trouble if we start punishing these schools with a non-well-thought-out proposal.”    

NASFAA expressed similar concerns in a letter it sent to Sen. Lamar Alexander (R-TN), who chairs the Senate education committee, in response to a white paper he released in February outlining his proposals for reforming federal accountability, which focused on eliminating or changing many current metrics and discussed details of a risk-sharing model. NASFAA argued that a poorly-designed accountability measure may create a “perverse incentive of increasing the number of institutions (most likely community colleges) that choose not to participate in the federal loan programs, choking college access to thousands of students who would not be able to attend without those dollars.”

Collins also suggested that Congress explore the idea of using loan repayment rates as an alternative to cohort default rates (CDR) to judge an institution's quality and hold it accountable for student outcomes. Reporting CDR rates, he added, catches students after they default on loans and too late in the repayment process, which NASFAA has similarly argued.  

Panelist Charles Pruett, assistant dean of student financial aid at the Georgetown Law Center, a private graduate school, however, argued that some schools already have “skin in the game,” such as those that rely heavily on alumni donations. He explained that some institutions are already pressured to ensure that their students graduate and secure high-paying jobs after completion in order to secure future funding from them.

On the topic of transparency, Collins said that one of his main concerns is that students do not know that their loans accrue interest while they are enrolled in school, and suggested an alternative to the current process — a new standard in which students pay the interest on their loans while they are enrolled in school, unless they opt out.

The panelists also discussed briefly their support and concern for specific provisions related to simplifying aid outlined in the House Republicans’ bill to reauthorize the HEA, dubbed the PROSPER Act. Knepfle said he supported the prospect of streamlining repayment plans, but struggled with the idea of eliminating subsidized loans. He also warned that the concept of weekly aid disbursements and mandated Pell Grant counseling would be extremely burdensome for aid offices.

Collins argued that while the bill included proposals he both supported and opposed, “Congress “needs to move forward with legislation,” as it is currently enforcing decades-old regulations that do not recognize the unique needs and makeup of the population entering — or attempting to enter —  higher education today.

 

Publication Date: 5/11/2018


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